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Ranbaxy may Move Away from Generics Following Merger With Japanese Multinational Daiichi

by Gopalan on  June 20, 2008 at 12:38 PM Drug News   - G J E 4
 Ranbaxy may Move Away from Generics Following Merger With Japanese Multinational Daiichi
India's Ranbaxy Laboratories could move away from generics following its merger with the Japanese multinational Daaichi Sankyo.
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When it was announced last week that Japanese multi-national Daaichi Sankyo was acquiring India's famed Ranbaxy, it was thought Daaichi would seek to leverage Ranbaxy's strong presence in the generics market.

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After all Ranbaxy is among the top 10 global generic companies. Its stated vision has been to be among the top five global generic players and to achieve global sales of $5 billion by 2012.

But now many wonder whether Daaichi would be that keen to enter the generics minefield. One has to contend with patent-holders all the time.

Close on the heels of the announcement, Ranbaxy chose to settle its five-year battle with Pfizer over Atorvastatin (Lipitor), the world's most-prescribed cholesterol-lowering medicine.   

Malvinder Mohan Singh, CEO and MD, Ranbaxy Laboratories Ltd., said, "This comprehensively settles outstanding issues between Ranbaxy and Pfizer bringing to closure a number of ongoing patent disputes. It also provides certainty and visibility to the launch of Ranbaxy's Generic Atorvastatin, with 180-day market exclusivity in the US and an early entry in other markets. This will make the worlds largest selling drug more accessible to patients who will gain from the timely availability of an affordable quality option."

Ranbaxy will also have a license to sell Atorvastatin on varying dates in an additional 7 countries, including: Canada, Belgium, Netherlands, Germany, Sweden, Italy and Australia. Ranbaxy and Pfizer have also resolved their disputes regarding Atorvastatin in Malaysia, Brunei, Peru and Vietnam.

In addition, the lawsuits between Pfizer and Ranbaxy regarding Atorvastatin will be dismissed in select countries and the lawsuits between Pfizer and Ranbaxy regarding the fixed dose combination product containing Atorvastatin and amlodipine will be dismissed in the U.S. and Ranbaxy will no longer contest the validity of Pfizer's patents in such countries. Such patent challenges by Ranbaxy regarding Lipitor have been underway in numerous markets since 2003.

The company will launch the generic version of Lipitor in Canada this year, while that of Nexium will be introduced only in 2014.

Till now, Ranbaxy has been leading the race in opposing intellectual property through Para IV challenges, filing for pre-grant oppositions to MNC drugs and even fighting biggies such as Pfizer on their own turf. This could change now and out-of court settlements with other pharma majors might be speeded up.

Industry experts pointed out that Daiichi, being an innovator company (pro-patent), might not be very keen that Ranbaxy pursues litigation against drug MNCs in future over generics, writes Rupali Mukherjee in Times of India.


The Japanese MNC may not want to be saddled with high litigation costs incurred due to these challenges. Ranbaxy has been spending around $25-30 million as legal costs on an average every year.

   Ranbaxy till now has been pursuing an aggressive first-to-file (FTF) strategy as it feels that these molecules present a huge opportunity and offer a major commercial upside to its organic growth.
   Analysts have earlier estimated that it can mop up around over $2 billion revenues from its four FTF molecules (sumatriptan, tamsulosin, valacyclovir and atorvastatin).
   The first-to-file benefit allows 180 days of market exclusivity to the company in the US when it launches the drug.

  Sanjiv Kaul, MD, ChrysCapital, said: "Patent challenges are an integral part of the growth strategy for a global generic player. Any dilution in that orientation can seriously hinder growth. I don't see Daiichi weaning away Ranbaxy from pursuing patent challenges through the Para IV route. Although there may be some challenges that Ranbaxy may reconsider purely from a cost-benefit analysis."

Ranbaxy CEO and MD Malvinder Singh said, "We will follow a case-to-case basis on our other patent challenges".







Source: Medindia
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