Endo’s Patent Loss Over Blood Pressure Drug Adds to Its Troubles
(Bloomberg) -- Endo International Plc’s loss in a patent fight over its bestselling blood pressure drug comes at a tough time for the company, as it grapples with opioid lawsuits and weighs a debt restructuring.
Endo’s Par Pharmaceutical lost a trial court ruling Tuesday in its bid to stop Eagle Pharmaceuticals Inc. from selling a generic version of Vasostrict, used to treat low blood pressure. Eagle’s version of the drug won’t infringe two Par patents, U.S. District Judge Colm Connolly in Wilmington, Delaware, said in his opinion, after a three-day trial without a jury in July.
Looming generic drug competition to a product that generated 27% of the Irish company’s revenue last year adds to the pressure on Endo, which is already consulting debt restructuring experts as it faces liabilities from opioid litigation. Peers including Purdue Pharma LP and Mallinckrodt Plc filed for Chapter 11 bankruptcy protection to settle their own stacks of lawsuits.
One of the Vasostrict patents covers compositions of vasopressin, the drug’s active ingredient. The other covers methods of using such compositions to increase blood pressure. Both require that the compositions have a pH level, an acid versus base measurement, of 3.7 to 3.9, a range at the center of the ruling.
Connolly pointed to the drug’s release and stability pH specifications as Eagle’s application with the U.S. Food and Drug Administration define them, which “directly addresses the issue of infringement raised by Par.” He rejected “Par’s attempt to use testing data to support a finding that Eagle would violate the binding representations it made to the FDA” in its application. “But even if I were to consider that data, it would not change the outcome of this case,” the judge said.
Endo’s shares sank 16% to their lowest price in a year before recovering. At 2:14 p.m. in New York trading, they were at $2.30, little changed from Monday’s close. Eagle’s shares rose as much as 15% and were up 9.7% to $52.10.
Endo’s 6% bond due 2028 dropped as much as 5.5 cents on the dollar to 58 cents on Tuesday, before rebounding slightly to 62.5 cents, according to Trace.
“We are delighted with this decision,” Scott Tarriff, Eagle’s chief executive officer, said in a statement. “We look forward to making our vasopressin product available soon.”
Endo pledged to appeal the ruling, saying the judge had to reconcile “conflicting appellate case law” in his analysis.
Vasostrict generated $785.6 million in sales last year for Endo. Both patents expire in 2035, according to the FDA’s registry of information on approved drugs.
“Given the multitude of additional generic filers behind Eagle including many leading players in the hospital injectables market, there is little residual value” for Endo “to hold on to once generics hit the market,” Elliot Wilbur, an analyst at Raymond James, said Tuesday in a note.
Eagle said in June that the FDA had assigned a target date of Dec. 15 for approval of its application to sell its copycat. Tarriff said the company, whose first-to-file status gives it about six months of market exclusivity, expected to launch U.S. sales before year end. A 30-month stay of final FDA approval expired last October.
The case is Par Pharmaceutical Inc. v. Eagle Pharmaceuticals Inc., 18-cv-823, U.S. District Court, District of Delaware (Wilmington).
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