| 'Drug In Focus' is written by Leighton Howard, a patent information expert with extensive experience in the generic pharmaceutical industry. He has worked within the professional patent information industry and major generic pharmaceutical firms. He is the founder of XIP Pty Ltd, the professional patent search firm responsible for researching all patent data found in GenericsWeb Pipeline Patent Intelligence. Please email any comments or queries. |
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During the final quarter of 2005 the antidepressant Sertraline (Lustral, Zoloft) will lose substantial patent protection in major markets around the world when extensions on the active ingredient patent expire. Based on information contained in the GenericsWeb Pipeline Selector report for Sertraline, this month’s Drug In Focus analyses the patent landscape surrounding this product with a view to launching generic equivalents in those major markets.
The Sertraline General Information (Table 1) indicates that two oral dosage forms are generally available in the form of a solution and film-coated tablets. Indications generally include depression and a variety of disorders including Obsessive Compulsive and Post-Traumatic Stress disorders.
Table 1: Sertraline General Information
The Key Patent Indicator (Table 2) for Sertraline confirms that the extensions on the Sertraline active ingredient patent expire in Australia, Germany and the UK toward the end of October 2005. The US molecule patent however, has been extended until 30th December, with an additional six months’ protection for paediatric indications.
Table 2: Sertraline Key Patent Indicator
In addition to the molecule patent family, the Key Patent Indicator identifies four other constraining patent families. Of key importance is the patent family claiming the Treatment of anxiety-related disorders.
These claims clearly protect the approved indications for post-traumatic stress disorder and obsessive-compulsive disorder, amongst others. Whilst the major indication for treatment of depression was disclosed in the active ingredient patent and will become public domain upon its expiry, the protection of only some of the approved indications may present difficulties in launching generics in some countries. For example, in Canada the Ontario drug formulary listed Apotex’s Sertraline generic as interchangeable with Pfizer’s Sertraline only when sold for purposes of treating depression (88% of Sertraline sales) because the co-indications were protected by patents. Although noting the practical difficulties in complying with such a listing, the Court of Appeal upheld this decision.
In Europe, the ECJ Directive 2004/27/EC, which is to be implemented by October 2005 states that:
“A medicinal product that is essentially similar to a product which has been authorised for not less that [6/10] years in the Community and is marketed in the Member State for which the application is made may be authorised, under the abridged procedure…for all dosage forms, doses and dosage schedules already authorised for that product”
(see Anna McKay’s article in INNsight Industry Newsletter, June 2003). This effectively removes regulatory restrictions in Europe, but the presence of patents may constrain the manner in which the product is marketed or labelled, although this is thought to have a only a limited effect on the market penetration by generics. In Europe, claims to treatment of obsessive-compulsive disorder were granted in EP429189-B, however opposition was filed by KRKA and Egis, resulting in revocation of the patent in December 2003. Meanwhile Pfizer had filed divisional applications EP1125581-A, EP1127571-A and EP1129708-A claiming treatment of panic disorder, post traumatic stress disorder and social phobia respectively. Whilst EP 1125581 and EP1129708 have met with objections by the examiner and are scheduled for timely oral proceedings on 6th October 2005, EP1125581 has been granted and subsequently opposed by Hexal, Egis and Generics UK. If these claims are ultimately allowed, the protection will not expire until October 2010.
In Australia the equivalent patent has been granted and with no precedent set by the TGA in regard to generic approval of only part of a set of approved indications the outcome is uncertain. However, Arrow signed an agreement with Pfizer granting them a license to distribute a brand of Sertraline from November 2004, allowing them early access to the market.
A further patent identified by the Key Patent Indicator relates to crystalline polymorphs, a patent in respect of which both Teva and Dr Reddy’s attempted to obtain declaration of non-infringement and/or invalidity in the USA from Pfizer. These attempts, which were made because of Pfizer’s failure to sue within 45 days of Paragraph IV filings was thwarted by the courts on the basis that there was no actual controversy, so the cases would not be heard. My understanding is that this situation may leave Pfizer with the opportunity to sue at a later date. The equivalents of this patent have been identified outside of the USA only in Japan, hence this patent should not ordinarily affect European or Australian generic launches.
Similarly, patents claiming further use of Sertraline in the treatment of premenstrual dysphoric disorder have no identified equivalents outside of the US. However, these may constrain generic competition in the US dependant upon Pfizer’s life-cycle strategy for this drug.
Finally, the Key Patent Indicator highlights a formulation patent, which relates specifically to the oral concentrate solution of Sertraline. Although these formulation patents may represent a barrier to launch of a generic Sertraline oral solution in major markets, it is not likely that they will prevent generic competition of this dosage form completely. This view is confirmed by patenting of alternative solution formulations by major generic competitors such as Dr Reddy’s.
Study of the Patent Risk Analysis graphs, based on comprehensive patent data (details of which is accessible in the corresponding Pipeline Developer subscription) indicates that patenting activity relating to this drug is strong in the area of process patents (Figure 1). More than 50 individual inventions (patent families) have been applied for relating to preparation of this active ingredient, over 25% by Pfizer. This indicates that caution is necessary with regard to development of non-infringing synthetic routes in ensuring that all relevant patents have been considered.
Figure 1
Patent Filing Trends data (Figure 2) reveals that only limited amount of patenting was carried out by Pfizer in the early part of Sertraline’s lifecycle. Although some research and development was clearly carried out in identifying additional uses, the effect of this research on protecting the market post molecule-patent expiry is limited. The process patents filed by Pfizer in the early 90’s may have created some hurdles for generic competitors but the large amount of process patent applications filed toward the end of the drug’s life (usually by generics) suggests that these hurdles were not insurmountable.
Figure 2
In summary, the market for Sertraline is only protected by virtue of the later use patents protecting only a few of the approved indications. The varying regulatory requirements around the world will determine how much protection these patents afford against generic competition, but based on European activity so far, the patents are seemingly susceptible to challenges by generic competitors if the effect on their potential market share is too significant. The unknowns are the US, where more Orange Book-listed patents are in force and ANDA applicants with Paragraph IV filings await Pfizer’s response, and Australia where the TGA will determine if and how it will allow approval of part-indications. However most European markets will likely see strong generic competition from the end of October 2005.
Comprehensive data for patent families relating to Sertraline, based on professional patent searching, may be accessed by subscribing to GenericsWeb Pipeline Developer reports which include twelve monthly updates to keep you abreast of recently published patents and applications. During the month of August, GenericsWeb are pleased to offer a 20% discount on the standard price of a Pipeline Developer subscription to Sertraline. GenericsWeb Pipeline Selector reports are available for any active ingredient upon request.
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DEVELOPMENTS AT GENERICSWEB |
Data Exclusivity Now In Pipeline Patent Intelligence
Confusion often arises when patent on an active ingredient have expired in a particular market, yet no generics have been launched. This could be due to many reasons, but often it relates to an unexpired period of exclusivity of the innovator product clinical trials data, upon which the generic application relies.
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The expiry of this exclusivity period can now easily be calculated using the first marketing authorisation data found in Pipeline Patent Intelligence, combined with our new, convenient guides for Australia and Europe. This information is now available by clicking on the Data Exclusivity button at the top of your current Pipeline Selector or Developer report, date for additional countries will follow.
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Sertraline First Marketing Authorisation Dates
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| Contributor Anna McKay specialises in IP Law and Strategy for Pharma companies. As an English solicitor, she won many leading patent cases before the Patents Court, Court of Appeal, EPO, and House of Lords for generic companies. She now works independently, advising companies worldwide on IP exploitation and strategy. |
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If you would like to contact Anna to give feedback or enquire about her services, please email
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Patent Revocation
This month, I could find no legal developments of any particular significance to generic pharmaceutical companies. I am sure I have missed something, and if you know what it is, do let me know, and I may write about it another time!
So, I thought I would write about something which is of perpetual interest to generic pharma companies, namely patents, and what to do about them. I am an English lawyer, albeit one who has enjoyed working all over the globe, and of course I write from an English perspective. However, since patent law Europe-wide is based on the same European directive, there is some relevance to other jurisdictions.
It is commercially worthwhile to be the first to market a generic drug. Prices for generic products can fall quite quickly, depending on competition, and sooner or later most products reach a level at which they make little profit for the seller. Generic pharmaceutical companies tend to look closely at patent portfolios protecting a given product as the main patents protecting the drug near the end of their life. They may find other patents covering formulation, processes, and uses, some of which will clearly be irrelevant to the product they intend to manufacture, some of which may be close, and others may seem to be invalid for reasons of obviousness or lack of novelty. Given SKB v Generics (1) they cannot, in the face of patents which they consider invalid or not infringed, sit back and wait to see whether the patentee takes action when they market. They must take steps to clear patents out of the way if they know ‘perfectly well [that] the issue of infringement is likely to arise’. In such circumstances, if they are to avoid the risk of injunction, they must apply for revocation of the patent, apply for a declaration of non-infringement, or invite action for infringement by the patentee. Each course of action has its own advantages and disadvantages. In March, I considered applications for declarations of non-infringement and infringement actions, and here, I want to say a little more about actions for revocation.
Clearing Obstacles
Sometimes, a generic company may feel that it needs to be proactive in order to get clarity in relation to certain issues or to satisfy a court that it has taken steps to clear patents out of the way. It is not clear quite what is required to discharge that obligation, short of legal action. If patentees delay, or claim that insufficient information has been given to allow them to make a decision, it may be preferable to take action, rather than risk injunction. Currently, there are cases in which generic companies have taken action against a patentee (Ranbaxy v Warner-Lambert(2), Arrow v Warner Lambert(3), and cases in which a patentee has taken action against a generic company (Mayne v Teva(4)) pending before the Patents Court.
In practise, most European pharmaceutical patents are European Patents, granted by the European Patent Office, rather than national patents, granted by national patent offices. It can take a very long time for patents to be granted by the EPO, and often relevant patents have not exhausted the opposition process by the time a generic company is considering its ability to market. Naturally, generic companies consider revocation before national courts as a quicker alternative. Revocation in one country can help in others: courts pay attention to what happens in other countries, and revocation in one country may be persuasive, for example, when a judge in another considers whether or not to injunct. For many reasons (speed, quality of judgements, reliability, specialised judges) English courts have been attractive to generic companies. Where there are parallel actions (eg an opposition before the EPO and a national revocation action) the English court will consider staying the English action. The basis on which the English court will grant a stay is described in a 1997 case by Aldous LJ, Beloit v Valmet(5):
‘ the fact that there may be proceedings both in the national courts and before the EPO is inevitable as patent rights, both under the [European Patent Convention] and the [Patents Act], are national rights to be enforced by the national courts and in certain circumstances by the EPO. That overlap can mean that there are parallel proceedings in both the national courts and the EPO with the potential for conflict. It is desirable for that to be avoided. Therefore the Patents Court will stay the English proceedings, if they can be resolved quickly and a stay will not inflict injustice on a party or be against public interest. Unfortunately that is not always possible as resolution of opposition proceedings in the EPO takes from about 4-8 years.’
Last year, AstraZeneca applied to stay English revocation proceedings pending the determination of an EPO opposition(6). Mr Justice Mann accepted that if the revocation action went ahead, AstraZeneca could be prejudiced by the more exacting approach of the English courts towards amendments, by inconsistent decisions, and would suffer wasted costs. He also felt that there had been delay. The patented product had been launched in 2000, and was immediately successful, so that it was apparent that a generic equivalent would be an attractive prospect. Notice of opposition was lodged on the last possible day, nine months after the grant of the patent, and English revocation proceedings began some eighteen months later. The judge felt a case that the English proceedings should be allowed to continue had not been made. He made it clear that he would have had more sympathy if parallel revocation proceedings had been undertaken in other major markets. This was against a background in which an abridged application for registration could not be made until 2010.
It seems to me that, in this case, the judge did not take into account the commercial background in a way which would have been appropriate in an application for a discretionary remedy (stay). The marketing of the product was not delayed by the timing of the opposition, not by the decision to delay the UK patent action. Further, markets for generic products differ greatly in different countries, and products which are attractive in one country are may not be in another. And, given that judgements in one jurisdiction may be persuasive in another it can be cost effective to take a step by step approach. However the judge was critical of actions which he felt were ‘not the act of a person who is anxious to exploit a pressing commercial opportunity’.
Inconsistent Decisions
I want to mention a recent case, Hunt Technology v Dun & Low, before considering the practical steps which a generic company might take in similar circumstances(7). This did not involve pharmaceuticals, but in it Mr Justice Laddie considered the parallel jurisdiction of the national courts and the EPO and said
‘the risk of inconsistent decisions …is probably a trivial consideration. Because of the ability to attack a granted patent in the national court, you may well end up with the EPO holding a patent to be valid and the same patent being held invalid by a national court. I do not consider that to be inconsistency. It is inherent in the co-existent jurisdictions of the EPO and national courts created by the European Patent Convention. Differing results in different tribunals is not really inconsistency. Ordering a stay may not significantly reduce the possibility of differing decisions, unless, of course the EPO goes first and invalidates the patent in its entirety.’
Validity of a granted patent is a matter for the national courts(8). A patent which has been maintained throughout the opposition and appeal process by the EPO may still be revoked by a national court – and in that context it seems curious that the risk of inconsistency should be a reason to stay national action.
What to do?
What should a generic company which wants to revoke apparently invalid patents do? There is no ideal solution. However, it should first, consider when it will come to market. What is its development time? When does data exclusivity end? Is it prepared to submit full data? If the EPO process will have been exhausted by that date, consider waiting. But be prepared to begin national proceedings if the patent continues to be maintained by the EPO. Ideally, not to lose time, you need a trial date close to the time of the EPO decision on appeal. That will mean that costs are incurred possibly to be wasted, but time is not lost.
If you could come to market before the end of the EPO’s evaluation, consider demonstrating that you have acted fast, and that there is urgency in your position. Show that you will be prejudiced by delay.
Possibly, judgments in the Ranbaxy v Warner-Lambert, Arrow v Warner Lambert, and Mayne v Teva cases will throw light on the best course of action, and if they do, I shall let you know.
(1) SmithKline Beecham v Generics UK Ltd (2002) IPD January 25005
(2) Ranbaxy v Warner-Lambert HC040C02059 TLC 683/04
(3) Arrow v Warner Lambert HC040C03986 TLC 28/05
(4) Mayne v Teva HC040C03755 IHC 940/04
(5) Beloit Technologies Inc v Valmet [1997] RPC 489
(6) IVAX v AstraZeneca HC0400 IHC 163/04
(7) Hunt Technology Ltd v Dun & Low Ltd [2005] EWHC 376 9Ch
(8) For the time being at least, pending the introduction of the European Patent Litigation Agreement.
| Contributor Peter Wittner has been in the pharmaceutical industry for 30 years. He has worked for the former Evans Medical and then Norton Pharmaceuticals (now part of IVAX) where he was responsible for European Sales & Marketing. After leaving Norton Peter set up his own consultancy in 1993 and operated independently until 1996 when he joined the Indian company Ranbaxy to set up the infrastructure of their new subsidiary. For the last 7 years he has been a consultant in the field of generics. |
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The Consolidation Continues
The start of the year saw the creation by Sandoz of the world’s largest generic company through its acquisition of the German Hexal together with its US partner EON. Combining the 2004 sales figures of all the parties gives a worldwide total of US$5.1 billion. This was enough to allow it to overtake the previous leader Teva who could only post a mere US$4.8 for 2004.
News has now emerged at the end of June that the final authorisation has been received for this deal to go ahead. The US Federal Trade Commission has cleared Novartis' proposed acquisition of Eon Labs, on the condition that the Swiss giant divests three of its generic products to a competitor. The European authorities also imposed conditions on their ratification of the deal by asking Sandoz to sell off certain pharmaceutical products in Poland, Denmark and Germany but Sandoz agreed so that the deal is now set to go ahead.
Following the Sandoz announcement at the start of the year, rumours began to surface in May and June that Teva was also sniffing around a German generic acquisition. The name mentioned in this context was Stada, which recorded sales of €338m, putting it in third place amongst the German generic companies and a long way behind the second placed Hexal which had a 2004 turnover of €997m.
It is not just the industry leaders, though, who are playing this game. In June the Indian company Matrix Laboratories announced its intention to spend €217m on buying a 22 per cent stake in the Belgian generic firm Docpharma in what seems to be the largest overseas acquisition so far by a member of the Indian pharmaceutical industry.
In the same vein and at around the same time another Indian company, Torrent, joined the acquisition trail by buying the German generic company Heumann, According to figures from the local industry body, Heumann Pharma Generics, had a turnover of €53m in 2004, and was ranked number fifteen in the German generics market. Torrent is thereby continuing the trend for Indian companies to buy market share in Europe rather than setting up from scratch.
These transactions have been preceded by other Indian acquisitions. For example Wockhardt acquired the UK generic drugs manufacturer CP Pharmaceuticals for £11m to add to Wallis that it already owned; Zydus Cadila acquired the formulation business of Alpharma of France for €5.5m, and the Indian leader Ranbaxy spent $70m to continue its acquisition activities in Europe by buying the French generic firm RPG Aventis.
According to rumours, it will not stop there; Ranbaxy and Wockhardt, are both reported to be looking for acquisition opportunities in Germany. And significantly, at the time of the Sandoz bid for Hexal, the head of Novartis Daniel Vasella said that the group would continue to focus on branded drugs, but did not entirely rule out further acquisitions in generics. He was reported as saying "You should not overdo things…" but added”, if a jewel does become available, we would remain open”.
A few interesting points emerge from this rash of activity. The first is one that is logical, although perhaps easily overlooked in any analysis. For each generic company that has been bought, there also had to be a seller. Torrent’s purchase of Heumann needed Pfizer to be ready to sell the company and so did Merck’s investment in NM Pharma of Sweden, while Pfizer were similarly keen to sell their Italian generic subsidiary Dorom to Teva, all of these occurring in 2004.
Why has Pfizer done this? The answer seems to be that the company has taken a strategic decision not to become involved in generics and in fact its earlier involvement was in effect “second hand”. The generic companies that it did own were actually previously part of Pharmacia when Pfizer acquired it.
The second interesting point is that the German generic market seems to remain attractive despite the pricing pressures induced by the “Aut Idem” regulation and despite the increasing consolidation, which also seems to be a consequence of the “Aut Idem” rule. The local trade association DGV (Deutscher GenerikaVerband) illustrated this in a recent position paper by showing that the top three generic producers in Germany (of which one is the Sandoz-Hexal combination) had a combined market share of 56.9% in early 2005. They contrasted this with the market share of the top three in 2001, prior to the introduction of “Aut Idem”, which amounted to 33.6%.
The third interesting point is that the Indian presence in Europe is growing and seems likely to continue to grow. If it is indeed true that Ranbaxy and Wockhardt are still looking for acquisition opportunities in Germany they are unlikely to be the only ones and they are also unlikely to be just looking at those markets alone. Building a market presence up from zero in any market takes too long and is too risky and expensive. Buying market share is also expensive but reduces the risks of market entry and takes a fraction of the time of the alternative entry methods.
If you have any comments or questions on this article, please feel free to contact me on peter@interpharm-consultancy.co.uk
Peter Wittner
July 2005
www.interpharm-consultancy.co.uk
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GENERICS EVENT WATCH AUGUST - SEPTEMBER 2005 |
Indonesia International Pharma Expo
Jakarta, September 7-10: International Exhibition on Pharmaceutical, Raw materials, Active Ingredients, Processing Machinery, Packaging Machinery & Equipments.
API's Europe
Lake Como, Italy, September 14-16: The best of the European API industry join together to show its latest development to a selected number of invited international end users; an international Conference with a Gala Dinner.
Licensing In The Generics Industry
Berlin, September 15-16: Beating the Competition through In- and Out- Licensing. Topics inlcude: Generics Trends on the Market, Getting the most out of European Licenses, Beating off the Competition, and Patent issues- Safeguarding your Market Share.
Pharma India
Hyderabad, September 16-18: International Exhibition & Conference for Pharmaceutical Industry, Raw Materials, Manufacturing and Packaging Industry.
Expopharm
Cologne, September 22-25: International Pharmaceuticals Fair.
IPC 2005
Shanghai - Symposiums 26-27, one-on-one meetings 28, Regulatory workshop 29-30: IPC 2005 will be focused on the business and market development in sourcing and outsourcing partnership of pharmaceutical ingredients and finished products for generics. There will be four symposiums at IPC 2005: (1) Sourcing Partnership for APIs and Intermediates, (2) From APIs Sourcing to Generics Outsourcing, (3) Intellectual Properties of APIs and Generics, and (4) Outsourcing Partnership for APIs and Intermediates. Workshop; Regulatory and Technical Requirements of European Marketing Authorization of APIs.
If you would like us to include details of any additional events that are relevant to the generics industry in our future newsletter please
email us.
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Australian Prescription Product Guide
Hard to find information in one easy to use source: Australian prescription product information including product information and consumer medicine information, and drug-drug interactions and herb-drug interactions.
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