AstraZeneca's Nexium gets a Korean competitor to chase it over the patent cliff

The difference between magnesium salt and strontium salt may be enough to threaten U.S. sales of AstraZeneca's ($AZN) blockbuster Nexium--starting now. Reports say South Korea's Hanmi is rolling out some early competition for the stomach drug before its patent expires next spring--the last thing the struggling AstraZeneca needs as it works to get back on track.

Tuesday, the British pharma said it was aware of reports that South Korea's Hanmi had launched its version of the heartburn and ulcer med in the U.S. amid an ongoing patent battle. Hanmi's drug, marketed by Amneal Pharmaceuticals, is a close relative of Nexium's, with a difference in salt forms the only variation between them.

The two drugs are so close, in fact, that AstraZeneca feels Hanmi is stepping on its patent rights, and it has been fighting a court battle to keep Hanmi's drug off the market. But in early October, a U.S. federal court lifted a stay on Hanmi's launch, giving the company permission to launch its version at-risk while the patent suit moves forward. If Hanmi loses, it could face twice as much in patent infringement damages--and AstraZeneca will just have to hope that will be the case.

Although sales of Nexium are on their way south, as Reuters points out, the drug still brought in global sales of $3.94 billion in 2012 that amounted to 14% of AZ's total branded drug sales. About $2.27 billion of that came from the U.S., revenues that Hanmi's product could compromise.

Of course, regardless of the outcome of the patent infringement suit, generic rivals will compromise Nexium's revenues come May, when the drug's patent is slated to expire. AstraZeneca, still hurting from the sales losses brought on by last year's Seroquel patent expiration, doesn't have another drug that can step in and fill the void once copycats descend on Nexium. While an OTC version of the treatment is expected to make its way to market, Pfizer now holds those rights after buying them for $250 million.

- read AstraZeneca's statement
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