Appeals Court Backs Merck Against Teva in Temodar Fight

Includes: MRK, TEVA
by: Daniel B. Ravicher

Back in September, I wrote about Merck & Co. Inc.'s (NYSE:MRK) lawsuit against Teva Pharmaceuticals (NASDAQ:TEVA) regarding the anti-brain cancer drug temozolomide, which Merck (via its Schering subsidiary) markets under the brand name Temodar® and which Teva (through its subsidiary Barr) wants to sell generically.

Back then, I predicted:

Executive Summary: A Court of Appeals decision in a patent infringement case between Merck's subsidiary Schering and Teva's subsidiary Barr relating to a $1B+/year brain cancer drug is expected within the next month or two. Although the trial judge below ruled in favor of Teva, opening up the possibility for them to launch a generic version of the drug this year, I expect Merck will win the appeal and thus be able to keep Teva's generic version of the drug off the market until 2013.

Today, the Court of Appeals issued its opinion and did exactly as I predicted, they reversed the lower court's ruling that Merck's patent was unenforceable.

I note, however, that one of the three judges dissented (with very strong language), and therefore it's possible the Court of Appeals as a whole (all 9 judges) may decide to rehear the case en banc (they do this when there are controversial legal issues that merit a full review by the entire Court of Appeals, and not just the three-judge panel to which the case was originally assigned). A decision about that will come in the next few months, after Barr makes a request for a rehearing, which it will undoubtedly do.

Disclosure: No positions