GlaxoSmithKline (GSK) announced that a federal judge for the United States District Court for the Northern District of Illinois (Chicago) has ruled in GSK's litigation with TorPharm Pharmaceuticals (a wholly owned subsidiary of Apotex) over GSK's anti-depressant drug, Paxil (paroxetine hydrochloride). The judge ruled that GSK's patent in the United States covering the hemihydrate form of Paxil is valid but not infringed by Apotex's product. The patent expires in 2006. GSK will appeal the ruling of non-infringement.

Although the judge did find it likely there would be some hemihydrate in Apotex' product, he found that GSK did not show hemihydrate would be present in sufficient amounts to infringe the patent under his claim interpretation. GSK disagrees with that claim interpretation.

The ruling by Judge Richard Posner on the hemihydrate patent represents one element of the current legal action between GSK and Apotex, which is seeking to market an anhydrate form of paroxetine hydrochloride. GSK is continuing to pursue litigation for infringement of other patents relating to Paxil against Apotex and other generic companies in the United States District Court for the Eastern District of Pennsylvania (Philadelphia). No trial date has been set. The last-to-expire 30-month stay against FDA approval of Apotex's product under Hatch Waxman law will expire on September 19, 2003.

Possible timing of a generic Paxil product remains unclear with the Philadelphia trial still pending and the Chicago decision now moving towards appeal. Consequently, GSK's published business performance earnings per share guidance for 2003 remains as previously stated. If a generic launch of paroxetine hydrochloride became imminent, GSK would reassess this guidance.

Paxil was launched in the US in early 1993, and the first generic company, Apotex, sought marketing approval in 1998 - only 5 years after first launch.