Eli Lilly pops the bubbly on U.S. Alimta patent victory

Courtesy of Eli Lilly

Eli Lilly ($LLY) has fought tooth and nail to protect a patent for its blockbuster cancer drug Alimta, chalking up some victories in the U.S. despite setbacks overseas. Now the company is celebrating a big win as a federal court ruled in its favor, barring copycat versions of the drug and granting Lilly 5 more years of U.S. exclusivity for Alimta.

The U.S. District Court for the Southern District of Indiana found that generic meds proposed by Israel's Teva Pharmaceutical Industries ($TEVA) would infringe on Lilly's method patent for Alimta in combination with vitamins, allowing Lilly to hold on to the patent until 2022. Lilly has a separate compound patent for the drug that is set to expire in 2017, so the latest court ruling provides some extra cushioning for the company as it looks to preserve sales for one of its best-sellers.

The ruling builds on a previous victory for the Indianapolis, IN-based drugmaker, as last year a federal judge held up Lilly's patient for a vitamin combo with Alimta. Lilly argued that without two B vitamin supplements, the drug could cause fatal side effects in patients. Teva argued that adding B vitamins to Alimta was a logical next step. But a U.S. district judge agreed with Lilly that figuring out a solution to the problem was no easy task.

Lilly's SVP and general counsel Michael Harrington said the company is "pleased" with the latest court ruling, and that the "significant scientific research that Lilly performed in support of the vitamin regimen patent deserves intellectual property protection," he said in a statement.

But as Bernstein analyst Tim Anderson pointed out in a note to clients, the "positive ruling was expected to occur." If Lilly had lost, it would have indicated "meaningful downside" given market expectations and the size of the drug, he said. Alimta brought in $2.7 billion in worldwide sales last year, and warding off copycats is a top priority for Lilly given it is hurting from generic competition to antidepressant Cymbalta and osteoporosis drug Evista.

Still, the company has had mixed results with Alimta patents in Europe. In March, a German appeals court dealt another blow to the company after ruling that Actavis' generics didn't infringe Lilly's patents for Alimta. Last year, Lilly lost a patent fight with Actavis in an English High Court over generic copies but the Court of Appeal in London reversed that in June. The new ruling, which applies to the U.K., France, Italy and Spain, could cover Alimta in those countries through June 2021. And the way Anderson sees it, the decision could add nearly 10% to Lilly's per-share earnings from 2016 to 2022, he estimated at the time.

- here's Eli Lilly's statement
- read the WSJ story (sub. req.)

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