AZ settles key Seroquel XR patent case

Will a settlement with generics maker Handa keep rivals for AstraZeneca's ($AZN) Seroquel XR at bay? Analysts seem to think so. Although a half-dozen other generic challenges to the big-selling drug remain, Handa's license to sell its version beginning November 2016 may keep other contenders off the market as well.

Handa's version of Seroquel XR "was the most 'dangerous' in our view, as it contained the least amount of overlap with AstraZeneca's patents," Savvas Neophytou of Panmure Gordon said in an investor note. So, the company's choice to settle ahead of an Oct. 5 trial date may augur success for AZ in the other lawsuits. Under the deal, Handa asserted the validity of the company's patents and got in return the rights to launch in 2016, a year ahead of the drug-delivery patent expiring in 2017, Mark Clark of Deutsche Bank told Dow Jones.

Neophytou said Torrent's Seroquel XR challenger is similar to Handa's in its overlap with the drug's patents. But since Handa has settled, he expects Torrent to follow suit. A dispute with 5 other drugmakers is still set for trial beginning Monday, Reuters points out, so we'll soon know whether Handa's deal affects their challenges.

"We believe this agreement reaffirms our intellectual property rights and is the right business for AstraZeneca at this time," CEO David Brennan (photo) said in a statement.

The company's Seroquel franchise won't escape generic erosion in the near term. The basic version is expected to face competition beginning in April after the company's patent on Seroquel's active ingredient expires. The company may be able to hold on to some of those prescriptions by converting patients to the long-acting XR version.

Together, the Seroquel drugs account for U.S. sales of about $4 billion per year, with the XR version contributing about $750 million of that. Worldwide, the franchise delivers $5.6 billion to AZ's top line.

- read the AstraZeneca release
- check Dow Jones' coverage
- see the post at the Guardian
- get more from Reuters