E Kumar Sharma
Mumbai headquartered pharma major Sun Pharmaceutical Industries
will be closely watched by all its stakeholders now that global MNC Wyeth Pharmaceuticals has filed a claim in the US court seeking $960 million in damages from Sun Pharmaceuticals. This is for alleged patent infringement in launching a generic version of Protonix, a medicine used to treat heartburn. While one will have to wait and watch for Sun's next move, the company maintains it still feels the Wyeth patent is invalid, unenforceable (implying in which case no liability on Sun). Therefore, it says, Sun "will pursue all available legal remedies including appeals."
In response to the claim by Wyeth (now acquired by Pfizer), the company says: "In due course, Sun Pharma will also serve upon the parties, Sun Pharma's expert reports providing its own assessment on the purported damages. After this, patent misuse and appropriate level of damages will be determined." However it also says, "Sun Pharma believes that it has sound reasons to disagree with these overstated claims of Wyeth, and also continues to believe that the patent is invalid and unenforceable." This case, which has been pending for many years, took a new turn with Wyeth submitting to the United States District Court of District of New Jersey, a confidential expert reports claiming damages against Sun and Teva arising out of their "at-risk launches."
Earlier in 2010, the District Court had denied Sun and Teva "(the defendants) motion for judgment as a matter of law seeking to reverse the jury verdict that the patent is not invalid. The District Court is yet to rule on patent misuse,'' a media release from Sun says.
There are therefore still lot of uncertainties: What could be the outcome of any appeal by Sun in a higher court against the validity of the patent. Also, what would be the assessment of the damages (which obviously analysts expect would he much lower than the Wyeth claim). Some of the analysts, who have been tracking the developments and have been suggesting a `hold' position on the Sun stock for sometime now, have maintained that there has always been the possibility of damages on its "at-risk" launch of this generic pantoprazole in US. But to what extent, if at all, and by when, is apparently far from clear. For the moment, with no clear timeframe on the way ahead, it could well be a long drawn case before can get a clear picture on the likely outcome. As for the Sun Pharma scrip on Thursday, February 16th, it hit a day's low of Rs 535
and a high of Rs 548 before closing at Rs 541.45.