March 6, 2009 / 2:27 PM / 8 years ago

PREVIEW-AstraZeneca goes into battle to defend Crestor

LONDON, March 6 (Reuters) - Lawyers at AstraZeneca (AZN.L) will begin the long process of defending the company's all-important cholesterol drug Crestor from generic competition in a U.S. courtroom next week.

The claims construction hearing in front of a magistrate on March 10 won't resolve the patent dispute but marks the start of a legal battle that may weigh on the Anglo-Swedish drugmaker's stock.

After seeing off the immediate threat from cheap generics to Nexium, Seroquel and Pulmicort last year, AstraZeneca is widely expected to prevail in the latest patent dispute.

But the litigation is likely to cast a shadow over the long-term future of its key growth driver for at least the next year and AstraZeneca could decide to strike a deal if things get rough, Citigroup analyst Kevin Wilson wrote in a recent note.

Crestor sold $3.6 billion worldwide in 2008 and will become even more critical as sales of older medicines fall away, with Citi predicting it will account for 25 percent of AstraZeneca's operating profit in 2012 -- provided the patents hold.

Next week's hearing in the U.S. District Court for the District of Delware will determine the exact claims to be considered at a full trial scheduled for February, 2010.

It represents an important step, since after March 10 either the generic companies or AstraZeneca will be able to file for summary judgement in the case.

"This is a procedural hearing leading into the trial and it doesn't change our confidence in the patent," an AstraZeneca spokesman said.

Apotex, Aurobindo (ARBN.BO), Cobalt, Mylan (MYL.O), Par PRX.N, Sandoz NOVN.VX and Sun (SUN.BO) all announced in late 2007 that they planned to sell generic versions of Crestor.

They are contending that material information was omitted when the original Crestor patent was filed by AstraZeneca's partner Shionogi (4507.T) and that this amounted to inequitable conduct.

AstraZeneca's action against all seven generic firms has been consolidated in the Delaware case. A subsequent challenge from Teva (TEVA.TA) in June 2008 is not included.

Editing by Elaine Hardcastle

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