Neurontin Bulk Supply May Limit Generic Uptake, Pfizer Says

Neurontin generics will have to overcome limitations in the bulk drug supply in addition to Pfizer's patent defenses, Pfizer CEO Henry McKinnell told a Jan. 22 earnings conference call.

Neurontin (gabapentin) represents "a major bulk production requirement, even on our scale, so there probably isn't enough bulk in the world absent the Pfizer supply to be able to meet demand here for some time in the future," McKinnell said.

As a result, if generic companies ultimately prevail in patent litigation, "the rate of decline in the face of generic competition" will not be as steep as with other generic launches, McKinnell said.

Pfizer is in litigation with five generic manufacturers defending its patent on a low-lactam bulk formulation of gabapentin.

The company received the patent in April 2000, just in time to hold off the expected launch of generics later in the year (¹ (Also see "Pfizer Sees Neurontin Exclusivity Through 2002, Pregabalin Filing By Year-End" - Pink Sheet, 31 Jul, 2000.), p. 23).

The 30-month stay of approval prompted by the listing of the low-lactam patent (No. 6,054,482) in FDA's "Orange Book" has expired for two of the five generic companies (Apotex and Purepac), Pfizer noted.

However, the company does not expect any generic firm to launch until the court proceedings surrounding the patent are resolved.

"I cannot speculate as to what another company may decide to do, but any generic launch in advance of final resolution by the courts would be a very unusual and highly risky strategy," Pfizer General Counsel Jeffrey Kindler said.

"You can be sure that under those circumstances, we would vigorously assert all of our rights and remedies to protect our intellectual property."

Another issue that could delay generic approvals is a decision by FDA on which firm or firms is entitled to first-to-file generic exclusivity (² (Also see "Generic Neurontin: Hurdles To TorPharm Approval Expected To Clear In Jan." - Pink Sheet, 6 Jan, 2003.), p. 26).

The next milestone in the litigation over the low-lactam patent is a status conference Feb. 13, Kindler said. He noted that there is a new magistrate involved in the case.

"Discovery in that case is essentially complete and defendants have filed a wide variety of motions for summary judgment alleging invalidity and noninfringement on various legal and factual grounds," he said. "We have strongly contested those motions and will continue to do so."

"We don't know when the motions will be decided or when a trial will be scheduled."

Pfizer did lose an appellate decision regarding a separate patent (No. 4,084,479) which covered used of Neurontin for neurodegenerative diseases.

"The appeals court upheld the trial court's position that, even though physicians do in fact prescribe Neurontin for these conditions, the generic company Apotex could market gabapentin without violating this particular patent if it did not intend that its product be used to treat those diseases," Kindler noted.

The ruling against Pfizer is in keeping with several other court decisions over the past decade which limit the ability of patents or exclusivity for follow-on indications to block generic launches (or substitution in the market).

However, McKinnell indicated that Pfizer intends to raise similar issues regarding a patent covering Neurontin for use in pain indications.

"Just to complicate it a little further," McKinnell said, "we do hold a valid patent for the use of Neurontin in neuropathic pain and that is also one we would expect to defend aggressively." The patent is not listed in FDA's "Orange Book."

Neurontin was approved for treatment of post-herpetic neuralgia in May (³ (Also see "Neurontin Pain Claim Follows Cmte. Preference For Individual Etiologies" - Pink Sheet, 3 Jun, 2002.), p. 11).

Although Neurontin has been widely prescribed off-label for the use (and Pfizer is responding to a Justice Department investigation of the marketing practices for the drug), Pfizer credited the approval with triggering a "strong uptick in Neurontin use and prescriptions."

Sales of the drug grew 28% in the U.S. to $1.94 bil. during the year. Worldwide sales were up 30% to $2.27 bil.

Pfizer told analysts on the call that its forecasts for 2003 assume no generic competition for Neurontin.

The company hopes to defend Neurontin until it can establish the successor agent pregabilin; Pfizer expects to file an NDA for the agent this year, after several delays.

McKinnell maintained that pregabilin will perform well even if generic versions of Neurontin are in the market. "These are different molecular entities," McKinnell noted. The message supporting pregabilin will be, "to put it simply, newer and better."

Pfizer's defense of the Neurontin patents is often cited by generic companies as an example of the need for Waxman/Hatch reform. During the call, McKinnell was careful to make a public interest argument in Pfizer's defense.

"Neurontin was introduced in the U.S. in 1994, and [having just] eight or nine years to obtain a return on that investment, I don't think is in the public interest," McKinnell said. The Waxman/Hatch Act caps exclusivity grants at 14 years after launch, and the brand name industry argues that that limit should be revisited.

In the case of Neurontin, the investment in development was made by Warner-Lambert, which Pfizer acquired in 2000. (Pfizer is quick to point that out when responding to inquiries about the investigation into Neurontin marketing.)

The '482 patent was issued after Warner-Lambert acceded to Pfizer's hostile takeover bid. The extended exclusivity for Neurontin would have to be considered an expected bonus to the company in the Warner-Lambert deal.

The patent runs until 2017, which means that Neurontin would ultimately have 23 years of exclusivity if generics have to wait until it expires.

Pfizer is also defending a two-front challenge to its exclusivity for the calcium channel blocker Norvasc (amlodipine besylate).

Dr. Reddy's recently won a court decision that could clear the way for it to launch a different salt formulation of amlodipine (⁴ (Also see "Pfizer Loses Norvasc Ruling: Rx Patent Extensions Are For Product, Not Use" - Pink Sheet, 23 Dec, 2002.), p. 15).

However, Kindler pointed out, the product "would not be substitutable and would not be 'AB'-rated. That means that Dr. Reddy's would actually have to promote its product in an already crowded antihypertensive field, so it would presumably be harder to do that."

Pfizer intends to appeal the ruling once it is formally entered. In addition, the company has petitioned FDA to block the approval, arguing that Dr. Reddy's has no right of reference to the Norvasc clinical data.

"We believe our legal position on this is correct and we are prepared to pursue it in court if the FDA should disagree," Kindler added.

Mylan has filed a more conventional patent challenge seeking to come to market with an 'AB'-rated product before 2007. Kindler maintained that all of Mylan's arguments were previously "considered and rejected by the Patent Office."

"We're getting pretty close to abuse of the patent system here," McKinnell declared. "These are very speculative claims which have been reviewed by the Patent Office and issued."

On the Dr. Reddy's challenge, "I personally find it rather offensive that a company based in India, which does not recognize pharmaceutical patents, which allows their companies to steal our technology and make hundreds of millions of dollars, would try to do the same thing here in the U.S. It is particularly bad public policy."

Pfizer also has a different challenge to the Norvasc franchise: explaining the ALLHAT clinical study findings to doctors (see ⁵ (Also see "ALLHAT Supports First-Line Norvasc Use, Pfizer Claims" - Pink Sheet, 27 Jan, 2003.)).

As with Neurontin, Pfizer's forecasts for 2003 assume no generic versions of amlodipine.

Norvasc sales were $1.78 bil. in the U.S. during 2002, an increase of 7%. Worldwide sales were up 7% to $3.85 bil.