GlaxoSmithKline said on Monday it would appeal a U.S. court ruling that sided with Israeli drugmaker Teva Pharmaceuticals (Nasdaq:TEVA) in a dispute over a patent covering its antibiotic Augmentin.
GlaxoSmithKline had hoped to expand the definition of usage for the drug, which would have allowed it to extend its patent period until 2018. The antibiotic's market share in the year 2000 was $1.7 billion, however competition with generic drugmakers is expected to reduce the price of the drug by as much as 50%.
Teva, which rose 4.5% yesterday on the Tel Aviv exchange, is currently rising another 1.3% despite a negative 2% arbitrage gap.
"GSK intends to appeal the court's ruling on the patent expiring in 2018," GlaxoSmithKline said in a statement.
Looming patent expiries pose a major threat to profits of the world's big drugmakers, like GlaxoSmithKline.