Operating Ease Eludes Mylan

Mylan and Pfizer have been suing each other for five years over the Norvasc patent, with Mylan claiming that the patent is unenforceable or invalid. In October 2005, Mylan received FDA approval to sell three dosage strengths of generic Norvasc once Pfizer lost marketing exclusivity.

The battle took a dramatic turn late last week when Mylan started selling Norvasc copies even though it had lost its latest patent challenge against Pfizer in February.

Mylan said it acted because another drugmaker, Apotex, won a federal appeals court ruling Thursday that invalidated the Norvasc patent. The appeals court overturned a district court ruling that had favored Pfizer. The drug giant says it is reviewing the decision and "considering all options, including seeking reconsideration."

As it started selling generic Norvasc, Mylan went to court to protect its 180-marketing exclusivity. Mylan argues that because Apotex wasn't the first to file a generic application with the FDA, it shouldn't be allowed to sell generic Norvasc for 180 days. Apotex disagrees.

Meanwhile, Pfizer is selling generic Norvasc through its Greenstone subsidiary to fight Mylan's lower-priced drug. Brand-name companies often do this via their own subsidiaries or licensing deals with another generic-drug company.

The generic-drug industry decries this practice of "authorized generics," arguing that it dissuades companies from investing in efforts to win first-to-file status. "Brand-name companies are playing in their sand-box," says Morningstar's Laegeler.