Updated from 5:24 p.m. EST
(PFE - Get Report)
beat back a challenge from India's Ranbaxy Laboratories after a judge upheld two of the New York-based company's U.S. patents on Lipitor, the top-selling prescription drug in the world.
The Delaware federal court decision sent shares of Pfizer higher by $2.69, or 11.9%, to $25.27 in after-hours trading Friday.
Lipitor, a cholesterol drug, had sales of $10.9 billion last year, accounting for roughly 24% of Pfizer's overall sales. Pfizer sold more than $4 billion worth of Lipitor in foreign markets and about $6.6 billion in the U.S. in 2004.
Pfizer said Judge Joseph J. Farnan's ruling will entitle it to a permanent injunction prohibiting Ranbaxy from obtaining approval for or marketing its generic version of atorvastatin, the active ingredient in Lipitor, until 2011.
"Today marks a major victory for medical innovators and the patients who depend on them for important new therapies," Pfizer Chairman and Chief Executive Hank McKinnell said in a press release. "We will continue to defend against any and all patent challenges that seek to undermine our mission of finding new therapeutic innovations for the patients we serve."
Ranbaxy, a maker of generic drugs, has filed to contest Lipitor patents in several countries. In a case decided in October, a British court upheld the main Lipitor patent but declared a minor patent invalid. The main U.S. Lipitor patent doesn't expire until 2011.
Pfizer said it would appeal the loss on the minor patent, which expires in July 2010. Ranbaxy was joined by another generic company, Arrow Generics, in challenging the 2010 patent. Ranbaxy has said it plans to appeal the decision on the main patent.
Last March, Austria's patent office ruled in favor of Ranbaxy in a Lipitor lawsuit, a decision that Pfizer has said it will try to have overturned. Wall Street didn't seem too bothered by the Austrian ruling, but analysts in the past said that losses of the U.S. patents on Lipitor could be devastating for Pfizer and
perhaps the larger pharmaceutical sector
, making the Delaware ruling a tremendous victory for the company.
Since Lipitor's introduction in 1997, more than 18 million people in the U.S. have been prescribed the drug. Lipitor is cleared in more than 70 countries. Recently, the Food and Drug Administration approved a new indication for Lipitor to reduce the risk of stroke, including in people who have diabetes.