* Agreement with Watson and Egis over U.S. generic challenge
* Astra to get fee on generic sales from May to July 2016
* Generic threat to top-selling drug Crestor dissipating
By Ben Hirschler
LONDON, March 25 AstraZeneca has seen
off a remaining threat to its top-selling cholesterol drug
Crestor by settling a U.S. legal case with generic firms Watson
Laboratories, a unit of Actavis, and Egis.
The settlement follows a U.S. appeal court ruling in
December involving other firms upholding the patent on the
medicine, which AstraZeneca is relying on as sales of other
AstraZeneca said on Monday that Watson and Egis had both
conceded the Crestor substance patent was valid under the latest
deal. The two companies had been trying to skirt round the
patent by developing an alternative chemical version of Crestor.
The agreement allows Watson to begin selling a generic form
of Crestor on May 2, 2016, at a fee to AstraZeneca of 39 percent
of net sales, until the end of paediatric exclusivity on the
drug on July 8, 2016. Egis, Watson's partner, will also benefit
from sales of the product.
The entry date may be earlier, and the fee eliminated, under
certain circumstances, details of which were not given.
Crestor had worldwide sales of $6.25 billion in 2012, making
it AstraZeneca's biggest seller, and $3.16 billion of that was
generated in the United States.
AstraZeneca said the deal with Watson and Egis would now be
filed with the U.S. Federal Trade Commission and the Department
AstraZeneca's partner Shionogi is also a party to
the latest settlement agreement.
Such agreements, under which big drug companies settle
patent litigation with generic rivals by making deals to keep
cheaper products off the market, are commonplace in the drugs
industry but they are gaining greater scrutiny from governments.
The U.S. Supreme Court will hear arguments on Monday over
the legal basis of such so-called "pay for delay" deals, which
have been criticised for pushing up drug bills.
While generic competition to Crestor is unavoidable from
mid-2016, protecting the brand up until then in the
all-important U.S. marketplace is crucial to AstraZeneca.
It is already struggling with falling sales of other
blockbuster medicines that have lost patent protection or will
do so soon, posing a major challenge to new CEO Pascal Soriot.
Soriot last week laid out his strategy for turning the
company around by cutting jobs and overhauling its research
operations, while at the same time seeking bolt-on deals.