Novo Nordisk has decided to sue the head of the US Patent and Trademark Office, Jon Dudas, after the agency twice refused to grant patents on the company’s inhaled insulin therapy, according to a report in Danish financial daily Boersen.

The USPTO has maintained that the information filed in the patent did not qualify for a patent as it was no contributing anything new to the field.

In response, Novo Nordisk claims the USPTO body has misinterpreted data, evidence and legislation, according to the newspaper.

Along with partner Aradigm, Novo Nordisk has been developing an inhaled formulation of insulin using a platform delivery technology known as AERx, which involves the use of an electronic device that creates liquid aerosols to carry the active drug into the lungs.

The device is in Phase III testing, and looks set to reach the market in 2009, well behind rival inhaled insulin product Exubera from Pfizer which is already on sale in the USA, Europe and other parts of the world.

Novo Nordisk said that the intellectual property under contention was not critical to the success of its insulin product – dubbed AERx iDMS - but that it was critical to have the new inventions covered. Inhaled insulins have been tipped as potential big sellers, with some predicting that Exubera could in time become a $1 billion product.

But a recent report from Datamonitor said that forecasts of big sales for inhaled insulins may be premature. This is in part because healthcare payers have so far proved reluctant to reimburse treatment with Exubera, but also because physicians may feel the potential risks of the treatment – such as long-term effects on lung function or carcinogenicity. Meanwhile, new orally-active drug classes emerging to treat the most common type II form of diabetes – such as GLP1 analogues and the DPP 4 inhibitors - could also reduce the market for insulin in these patients.

Datamonitor believes Exubera, far from being a multibillion dollar product, would see its sales peak at around $210 million in 2015. It would be pushed into second place – but only just - by a rival product developed by US company Mannkind, tipped to make around $290 in that year.