Shares of Mylan Laboratories ( MYL) rose Tuesday after the company said it received government approval to sell a generic version of Pfizer's ( PFE) blockbuster blood pressure drug Norvasc.

The Food and Drug Administration's approval could mean big money for Mylan, because Norvasc produced $4.4 billion in worldwide sales (including $2 billion in the U.S.) last year. Under FDA rules, the first company to file a successful generic application gets 180 days of market exclusivity once a brand-name drug's patent expires.

Mylan's shares gained $1.29, or 6.7%, to $20.67, exceeding its 52-week high. A company spokesman declined to say when Mylan would begin selling the generic drug, which still faces a few potential hurdles.

Pfizer and Mylan are entwined in a patent infringement lawsuit over Norvasc, whose patent expires in early 2007. The FDA said the 180-day exclusivity period will start "from the earlier of the commercial launch of the Mylan product or a final decision concerning the pending litigation," according to Mylan.

"Given the uncertainty of the patent litigation, we have not included contribution from generic Norvasc in our current Mylan model," Michael Tong of Wachovia Securities wrote in a Tuesday report to clients.

Tong said the companies could try to settle their differences or continue to fight in court. Or, Mylan could make an "at risk" launch immediately, hoping that it wins in court. If Mylan loses, the financial penalty would be severe.

The 180-day exclusivity period could be worth 28 cents a share to Mylan, Tong believes. He has a market-perform rating on Mylan. He added that at least four other generic manufacturers have applications pending before the FDA for generic Norvasc. Tong doesn't own shares of Mylan, and his firm says it intends to receive or seek investment-banking-related compensation in the next three months.

Another risk to Mylan is the prospect of Pfizer making a deal with another company to sell generic Norvasc. In recent years, a growing number of brand-name drugmakers have licensed, or "authorized," generic drugmakers to sell copycat versions of proprietary products after patents expire.

The strategy of "authorized generics" eases some of the revenue lost by the brand-name company. It also hurts a company like Mylan. Tong says his predictions assume the presence of an authorized generic.

The Norvasc announcement continues Mylan's recent series of good news. Last week, Mylan said a federal district court in West Virginia ruled in favor of the company in its patent fight with Johnson & Johnson ( JNJ) over the drug Ditropan XL for treating an overactive bladder. J&J's Alza unit plans to appeal.

Pending FDA approval, the court's ruling could pave the way for Mylan to receive 180-day exclusivity for marketing 5-milligram and 10-milligram dosages of the drug. Mylan says these two dosage strengths accounted for more than 80% of Ditropan XL's U.S. sales of $440 million for the 12 months ended June 30.

Also last week, Mylan benefited from the FDA's rejection of an application from Noven Pharmaceuticals ( NOVN) and Endo Pharmaceuticals ( ENDP) for a generic version of Duragesic, a pain patch made by J&J containing the narcotic drug fentanyl.

That was good news for Mylan, because it already sells a generic version of Duragesic. Noven said it disagrees with the FDA's decision and "will be evaluating available avenues" to get its product on the market. In July, the FDA issued a public health advisory , saying it was investigating reports of deaths and serious side effects that might be related to fentanyl patches.

Also last month, Mylan won FDA approval to sell generic versions, in two dosage strengths, of the diabetes drug Glucophage XR, which is made by Bristol-Myers Squibb ( BMY).