AstraZeneca (NYSE: AZN) won a pivotal court victory when a judge in Delaware overruled a patent challenge to Crestor, its blockbuster cholesterol drug. Judge Joseph Farnan upheld AstraZeneca's exclusive right to Crestor through 2016.
That's vital to the company, because it's counting on Crestor to help shore up sales as it loses patent protection on a series of drugs. And those lost patents are coming quickly--for example, the cancer drug Arimidex got generic competition in the U.S. this week. AstraZeneca loses exclusivity on the antipsychotic med Seroquel in March 2012, with Nexium protected from competition till 2014.
In his 44-page opinion, Farnan decreed that the generics makers challenging Crestor exclusivity were relying "on a hindsight analysis of a successful product and [their claims] ignore the judgements, decisions and experimentation that was required to reach the end product." AstraZeneca officials welcomed the ruling: "The court's decision reaffirms the strength of the intellectual property protecting Crestor," CEO David Brennan said in a statement.
The ruling boosted the company's stock by some 9 percent as investors cheered the news. "Most in the investment community felt AstraZeneca would very likely win," Bernstein analyst Tim Anderson wrote to investors (as quoted by the Financial Times), "but given how devastating a loss would/could have been, actually securing a favourable ruling removes an overhang."