Thursday, December 30, 2004

Ranbaxy against Pfizer on Lipitor has a long article on the intellectual property activity at Ranbaxy.

Jay Deshmukh, vice president for intellectual property of New Delhi-based generic drugmaker Ranbaxy Laboratories Limited, plus William Zimmerman and Darrell Olson, partners at Irvine, Calif.-based Knobbe, Martens, Olson & Bear reviewed Pfizer's composition of matter patent on Lipitor and concluded that the main Lipitor patent does not cover the form of a key ingredient, atorvastatin, used in the drug. Ranbaxy alleges that Pfizer misrepresented that fact to the Patent and Trademark Office when it won an extension on the patent until 2010.<--

Although the article by Sue Reisinger mentioned Ranbaxy's litigation against GlaxoSmithKline over Ceftin, the article somehow failed to mention Ranbaxy's deal with GlaxoSmithKline.

Of the Ceftin matter, Reisinger wrote:

-->But the company [Ranbaxy] was at a crossroads about what it should do in the U.S. Should it wait until the drug went off patent before selling the generic? Or could it find a loophole in the patent and market a version of the drug that was close enough to it to be a generic, but different enough so that it wasn't covered by the Ceftin patent? Deshmukh thought Ranbaxy's product was unique enough that it could market its generic as soon as it was ready. He also knew that as soon as the company notified Glaxo of its plans, the drug giant was likely to sue to protect its patent, so Deshmukh quickly looked to make sure he had the right outside counsel to defend the company.

Ranbaxy had retained Proskauer Rose, the prominent New York-based firm, as its primary outside counsel when the company entered the U.S. market in the late 1990s. But Deshmukh wanted a firm that focused solely on IP. "I needed to shift [Ranbaxy] management from trying to save money [by avoiding litigation] to using the best lawyers money can buy [to litigate]. You either litigate fully or you don't litigate," he recalls. Caprariello says Deshmukh faced considerable opposition from Ranbaxy's R&D department over the law firm switch, but the lawyer persisted. That department, to which Deshmukh reported, was "comfortable" with Proskauer, says Caprariello. Going to trial over Ceftin, which ultimately cost Ranbaxy $5 million, was a commitment beyond anything the company had done before, Deshmukh says.

Charles Guttman, who leads Proskauer's IP practice, argued in vain that the firm's broad litigation experience shouldn't be tossed aside. "I had been working with other people there [at Ranbaxy], and Jay came in and made his decision," Guttman says. "What can I say? I wish him well."

Deshmukh first searched for a replacement for Proskauer on the East Coast, but he says that most of the top IP firms there were already on Big Pharma's payroll. So Deshmukh called his friend and protégé Zimmerman at Knobbe Martens, a large IP law firm out West.

Deshmukh's opening gambit against Glaxo started badly. After receiving Ranbaxy's letter, Glaxo sued in federal court and in early 2001 obtained a preliminary injunction that stopped Ranbaxy from going to market. (Glaxo declined to comment on the case.) The pressure on Deshmukh was intense. Zimmerman says, "It was our first case for Ranbaxy, and we had lost our first battle. He never told us, but we knew the substantial pressures on Jay to switch law firms. We sat down with him, and he decided to stick with us for an appeal." Deshmukh concedes that his job was on the line.

Four-and-a-half months later, the U.S. Court of Appeals for the Federal Circuit reversed the trial court's injunction, saying it saw little chance that Glaxo could prevail at trial. But that good news presented Deshmukh and his team with a new dilemma -- whether to launch the generic before the trial concluded, which would give Ranbaxy a head start. Launching early would carry no repercussions as long as Ranbaxy won at trial; but if it lost, under U.S. patent law Glaxo could seek treble damages for willful infringement.<--

One does note that going with an IP boutique (Knobbe) over a GP firm is against current conventional wisdom. Many IP boutiques have been gobbled up with attorneys ending up at GP firms (eg, the story of Pennie & Edmonds and Jones, Day).

Ranbaxy did win on Ceftin. The article noted:

Deshmukh was able to parlay that success in several ways. He moved from being the sole IP lawyer reporting to R&D, to global vice president of intellectual property, reporting directly to CEO Tempest. Deshmukh oversees four other lawyers in the U.S. and in Europe, as well as a large technical staff of patent and chemical experts in India. (Ranbaxy's New Delhi-based GC spot was unfilled at press time.) Deshmukh says that the company has now established a $100 million threshold of sales; Ranbaxy primarily will look to develop drugs with revenues above that amount. Now, Deshmukh says, "We [the IP department] are the engine that drives the company train."

As a separate matter, the Public Patent Foundation initiated a re-examination of Pfizer's 5,969,156 based upon prior art within 5,273,995 (Roth) and 5,686,104 (Mills). The claims in the '156 are to specific crystalline forms of Atorvastatin.



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