Generic Plavix opens door for API manufacturers

Plavix's European patent is not due to expire until 2013 but approval of the generic in Germany and Luxemburg is predicted for this year, with Schweizerhall planning to launch the drug throughout the European Union. Schweizerhall's move could lead to the opening up of the European generics market, which would have a positive knock on effect on sales of active pharmaceutical ingredients. The approval process appears to be at a late stage, with Luzi von Bidder, chairman of Schweizerhall saying: "A first license agreement with a major generics company was already concluded and the signing of a contract with another generics provider is imminent. We expect first sales already in the current quarter​." Schweizerhall's initial release failed to identify the generics company and provider but Novartis AG's Sandoz and Germany-based Ratiopharm have since confirmed their involvement. Both companies were already in partnership with Schweizerhall, which develops and registers generic medicines for the two companies. What is less certain is how Schweizerhall's product has gained approval but a previous case in the US serves to reveal a possible chink in Plavix's patent. Canada-based Apotex previously marketed a generic version of Plavix in the US until June 2007 when a court barred them from doing so. Apotex felt its product did not infringe an active patent as it contained both enantiomers of the active ingredient, whereas Plavix only has one. BSM and Sanofi successfully fought off that challenge and plan to do the same in Europe, with Sanofi stating it will "vigorously defend intellectual property rights, including patent protection, in Germany​". Regardless of the eventual success of Sanofi's challenge it appears likely that the generic competitor will eat away at Plavix's sales in the short term. Merrill Lynch analysts are warning investors that there is no guarantee Sanofi will get the generic quickly removed from the market. A significant period of generic competition would see Plavix's sales drop as they did in the US. The case's outcome will clearly affect all the companies directly involved. However, the repercussions on the wider industry could be more dramatic, with significant implications for brand pharmaceuticals, generics and API sectors.