Eli Lilly was celebrating yesterday after a US judge ruled that a key patent covering the firm’s top-selling schizophrenia agent, Zyprexa (olanzapine), was valid. The firm’s share price jumped by 7% during after-hours trading in New York on the news, which means that it should be able to fend of generic competition to its biggest-selling drug for some time to come.

The judge in question ruled in Lilly’s favour on all counts, including that the defendants – Ivax’ Zenith Goldline subsidiary, Dr Reddy’s and Teva – had “failed to prove by clear and convincing evidence” that the Zyprexa patent, which is due to expire in 2011, is invalid or unenforceable. The companies had claimed that Lilly had “double patented” the product, contravening patent law [[28/01/04d]]. The outcome of this trial is expected to have ramifications for other companies facing patent challenges on their key drugs, including Sanofi-Aventis and Bristol-Myers Squibb, which are waiting to go to court to defend their clotbuster, Plavix (clopidogrel), against generic threats [[31/03/05c]].

“We have always been very confident that our patents are valid and enforceable and today’s court ruling sends a clear message on the strength of those patents,” said Sidney Taurel, Lilly chairman, president and chief executive. Nevertheless, the generics companies are not taking the ruling lying down. In a statement, Ivax said that it would “aggressively pursue all remedies available”, and was planning to appeal the decision. Dr Reddy’s also said it would lodge an appeal.

Zyprexa remains one of Lilly’s best-selling drugs with 2004 sales topping $4.4 billion dollars – however, this was just 3% higher than the figure recorded in 2003, primarily as a result of heightened competition in the US market, where sales slid by 8% [[27/01/05a]].