Operating Ease Eludes Mylan

Investors looking for volatility and uncertainty in the generic-drug business need search no further than Mylan Laboratories(MYL Quote).

The latest twist surrounding the company involves its effort to sell cheap copies of Pfizer's(PFE Quote) blood-pressure drug Norvasc.

Mylan began selling three dosage strengths of generic Norvasc on Friday, although Pfizer says it is considering legal challenges. Meanwhile, Pfizer is selling its own reduced-price versions of the medication while also keeping brand-name Norvasc on the market.

A federal court issued a decision Monday preventing the Food and Drug Administration from approving any other company's generic Norvasc until at least April 13. Mylan had asked the court to block the FDA from acting on other applications.

However, Ricky Goldwasser of UBS Securities wrote in a research report Tuesday that it's possible seven other drugmakers ultimately could jump in to the generic Norvasc market, thus dramatically cutting into Mylan's sales and profit.

The court ruling pushed up Mylan's stock by $1.06, or 5.2%, to $21.28.

The Norvasc affair illustrates the cut-throat nature of the generic drug business and the importance of the first-to-file law. This law gives 180 days of marketing exclusivity to the company that files the first generic-drug application with the FDA for a brand-name product. The clock starts ticking once the brand-name drug loses its patent protection.