Pfizer shares were given a lift yesterday after it announced that a near 10-year patent infringement battle over Protonix has been laid to rest with a settlement of $2.15 billion.
The drug giant said that it and Takeda Pharmaceutical (which now owns the drug's originator Nycomed) had accepted the settlement from Israel's Teva Pharmaceutical and India's Sun Pharmaceutical Industries.
Wyeth, which was subsequently bought by Pfizer, licensed exclusive US rights to the acid-reflux blockbuster from Nycomed (now Takeda), but the drugmakers were forced to drag Teva and Sun to court after they launched their own generic forms of pantoprazole in 2007 and 2008, before the intellectual property protecting Protonix had expired.
As part of the settlement, both Teva and Sun have admitted that sales of their drug infringed the patent, which was recently upheld as valid by the New Jersey Federal Court.
On the cash side, Teva will pay the majority of the settlement - $1.6 billion ($800 million this year and the same in 2014) - while $550 million will come from Sun this year.
Pfizer and Takeda will divide the proceeds, with the former receiving 64%.
Amy Schulman, executive vice president and general counsel of Pfizer, said the settlement "recognises the validity and value of the innovation that led to Protonix,” and stressed that “protecting intellectual property is vital as we develop new medicines that save and enhance patients’ lives.”