A London court upheld a patent on Pfizer Inc.'s blockbuster anti-cholesterol drug Lipitor on Wednesday, handing Pfizer a key victory by blocking Ranbaxy Laboratories Ltd. of India from launching a copycat version of the pill in Britain.
In its ruling, the High Court of Justice agreed with Pfizer that the New York company's underlying patent on the Lipitor compound was valid. It sided with Ranbaxy's argument that a more specific but secondary patent on a component of the same drug was invalid.
The decision amounted to a defeat for Ranbaxy, as the court upheld the underlying patent for Lipitor's active ingredient, which will remain protected in Britain from generic copies until the patent expires in November 2011.
"This is good news for Pfizer," said Stephen Bennett, a health care lawyer with Lovells, an international law firm in London. "It gets to keep its monopoly until expiry."
Pfizer welcomed the ruling. "This is an important victory not only for Pfizer but for all innovators," said Chairman Henry A. McKinnell Jr.
Ranbaxy said it would appeal the adverse ruling, while Pfizer said it would appeal the decision that invalidated its secondary patent.
The verdict was an important marker for both companies and for the rear-guard action mounted by the pharmaceutical establishment against upstart generic companies making copycat drugs.
A win for Ranbaxy, which this year won a similar case in Austria against Pfizer's Lipitor patents, would have allowed it to sell its copy of Lipitor by 2007, four years before the expiration of Pfizer's British patent.
That would have given it a big boost as it tries to gain access to international markets.
Key to Ranbaxy's success abroad is cracking the U.S. market, where Lipitor is also protected by patents. Ranbaxy has challenged the two key patents in a Delaware court, and a decision is expected by year-end.
Analysts said the British judgment would have little or no impact on the outcome of the U.S. case. And McKinnell said the British decision was based on British law and had no bearing on the Delaware litigation.
The U.S. case is more significant for Pfizer because the U.S. pharmaceutical market is so large. The company has faced a challenging earnings environment in recent quarters as generic-drug makers eat into its sales.
The British market constitutes just 7 percent of Lipitor sales, while U.S. sales of $3.6 billion in the first half of this year amounted to more than half the drug's worldwide takings.
The favorable finding in London will offer some support for Pfizer's share price, analysts said, which has fallen in recent months amid rising worries about Lipitor's patents.
In its statement, Pfizer said it would continue to "vigorously defend" its Lipitor patents wherever they are challenged.
Worldwide sales of Lipitor reached nearly $11 billion in 2004 and are expected to hit $12 billion this year. That helps Pfizer stay highly profitable.
Still, it faces stiff generic competition over the next couple of years, when patents expire on products such as the blood-pressure drug Norvasc and the antidepressant Zoloft.
Those looming deadlines make Lipitor even more important to Pfizer. Moreover, Lipitor, which lowers "bad" cholesterol, is a key component of a new Pfizer anti-cholesterol drug for which the company has high hopes. The new drug will also contain a compound that boosts "good" cholesterol.
Chances of converting customers to the new drug hinge on having enough patent protection to give them time to make the switch from Lipitor, analysts said.