Apotex ordered to pay AstraZeneca half its generic Prilosec profits

An award of $76 million may not sound like much in the big-dollar world of pharma, but for a branded drug company, it always feels good to win one against a generic drugmaker that has jumped the gun with a generic. That is how much a court says AstraZeneca ($AZN) should be paid by Apotex.

The $76 million represents half the profits the Canada-based Apotex made selling a generic of AstraZeneca's stomach-settling drug Prilosec between 2003 and 2007, Reuters reports. A federal judge in 2007 had found that Apotex's generic stepped on AstraZeneca's patent, so the latest case was all about money. That is the figure that U.S. District Judge Denise Cote in New York landed on after hearing the case. The ruling was made last month but originally kept secret, the news service said. The seal was broken Tuesday.

Prilosec, which at one time sold for $4 a pill, was a huge product for AstraZeneca. Before it went off patent a decade ago, the drugmaker devised a multiprong plan for how it would deal with the loss of revenue when generics hit. It developed its successor drug Nexium and worked to get doctors and patients interested in it as Prilosec's fortunes faded. But it also devised a legal strategy to fight off generics as long as possible.

The drugmaker's tactics were challenged by regulators in Europe, but AstraZeneca doggedly fought them as well. The EU in 2005 fined the U.K. drugmaker €60 million, saying it misled patent officials there in its effort to protect sales of the drug. Five years later, AstraZeneca got the fine knocked down to €52.5 million ($69 million) but was ordered to pay.

Now, AstraZeneca is fighting with generic drugmakers over Nexium, a drug that earned nearly $4 billion for the drugmaker last year and is on track to do the same this year. In August, the FDA approved Japanese drugmaker Hanmi Pharmaceutical's almost-copycat drug Esomezol, which uses a different salt form than AstraZeneca's stomach pill. Under terms of an earlier settlement reached by the two companies, Hanmi was able to launch its drug at-risk while they continue a legal battle over AstraZeneca's patents.

- read the Reuters story

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