Court ruling thaws Ranbaxy’s ‘Lipitor’ dreams

Court ruling thaws Ranbaxy’s ‘Lipitor’ dreams


Ranbaxy’s shares fell six percent after a UK court prevented it from launching a generic version of Pfizer’s blockbuster anti-cholesterol drug before the patent expires.

The high court judgment ruled that the basic patent on the $11 billion-a-year Lipitor, expiring in November 2011, was valid but a more specific patent, running out in July 2010, was not. “All the expectations built into the stock didn’t materalise and so there is panic selling,” said Rohit Bhat, analyst with Batlivala & Karani in Mumbai.

“This is more due to expectations among speculators that the UK victory for Ranbaxy would mean a victory in the US also. But the US can be totally different, nobody can get a direction in whose favour it will go,” Bhat said.

The British market accounts for nearly seven percent of global sales of Lipitor. As for the battle in the bigger US market, Ranbaxy expects a verdict on that patent by the end of 2005.

Ranbaxy’s shares had risen 11 percent in the 10-week period since the end of July in anticipation of a favourable outcome. Pfizer had lost out to Ranbaxy in a less significant patent case over Lipitor in Austria earlier this year.