sanofi-aventis and Bristol-Myers Squibb announced that their agreement, as amended, with Apotex Inc. and Apotex Corp., to settle the patent infringement lawsuit pending between the parties in the US District Court for the Southern District of New York has failed to receive required antitrust clearance from the state attorneys general. The lawsuit relates to the validity of a composition of matter patent for clopidogrel bisulfate (the '265 patent), a medicine made available in the United States by sanofi-aventis and Bristol-Myers Squibb as Plavix. When sanofi-aventis and Bristol-Myers Squibb initially announced the settlement on March 21, 2006, the companies said that there was a significant risk that required antitrust clearance would not be obtained.
The agreement also required the approval of the Federal Trade Commission (FTC). The FTC has not yet advised the companies of its decision. However, the agreement requires the approval of both the FTC and the states attorneys general to become effective. The originally scheduled trial date had been suspended pending possible finalization of the proposed settlement. A new trial date has not yet been established. As previously disclosed, sanofi- aventis and Bristol-Myers have filed patent infringement claims against three other generic pharmaceutical companies with respect to the '265 patent.
As previously disclosed, the companies learned earlier this week that the Antitrust Division of the United States Department of Justice is conducting a criminal investigation regarding the proposed settlement. It is not possible at this time reasonably to assess the outcome of the investigation or its impact on the companies.
It is also not possible at this time reasonably to assess the outcome of the Plavix litigation, including the Apotex matter, or the timing of potential generic competition for Plavix. Apotex announced in January 2006 that it had received final approval of its ANDA for clopidogrel bisulfate from the FDA. As a result, Apotex could launch a generic clopidogrel product at its risk.
Under the terms of the agreement, Apotex may be eligible to receive a reimbursement payment from the companies for certain short-dated inventories of Apotex's clopidogrel bisulfate product, the amount, if any, of which has not been quantified. Any payment to Apotex will be paid 50 per cent by sanofi-aventis and 50 per cent by Bristol-Myers Squibb. As previously disclosed, each of the companies recorded reserves in the amount of $20 million in the first quarter of this year. It also is not possible reasonably to estimate the impact of the Plavix litigation on sanofi-aventis and Bristol-Myers Squibb. However, loss of market exclusivity of Plavix and the subsequent development of generic competition would be material to sanofi-aventis' and Bristol-Myers Squibb's sales of Plavix and results of operations and cash flows, and could be material to sanofi-aventis's and Bristol-Myers Squibb's financial condition and liquidity.
The companies intend to vigorously pursue enforcement of their patent rights in Plavix, a company statement said.