Lundbeck Defends Its Escitalopram Patent In Denmark, But Not In Spain

Lundbeck's top-selling product, Cipralex, is responsible for more than half its sales, but faces generic competition in Spain.

Lundbeck has successfully defended its top-selling product Cipralex (escitalopram) against generic competition in Denmark but has lost a preliminary injunction in Spain, where generic versions are expected to be launched shortly.

Escitalopram accounts for around 57 percent, or DKK 7.7 billion (U.S. $1.4 billion), of the sales of the Danish company, so preventing or stopping what it believes is premature generic competition is paramount for the company.

European sales of Cipralex totalled DKK 3.7 billion last year, an increase of 17 percent over the previous year, and the product had a market share by value of 19.9 percent; it was Europe's most frequently prescribed antidepressant. In the U.S., where escitalopram is marketed by the licensee, Forest Laboratories as Lexapro , the drug had a 23.3 percent market share last year.

Until now, generic versions of Cipralex were marketed in a handful of smaller markets - Denmark, Norway and Australia, and some countries in Eastern Europe and Latin America.

However, the legal decisions disclosed by Lundbeck on April 16 mean that generics will become available in Spain, which is a much larger European market. At the same time, the generic versions are being withdrawn from a smaller market, Denmark. Both decisions can be appealed by the losing party.

Lundbeck will appeal the ruling in Spain, which consisted of the Commercial Court in Barcelona lifting a preliminary injunction against a number of generics drug makers. The Danish ruling against PharmaChange, a small Danish distributor of generics, consisted of a preliminary injunction from the City Court in Elsinore.

Spain is among Lundbeck's top-five markets, but the company is only expecting a moderate impact on Cipralex sales from the start of generic competition. The dynamics of generics markets can vary from country to country, Lundbecks says, and not all countries have a rapid decline in innovator sales following loss of patent protection.

Five Years Left?

Lundbeck claims its patents on escitalopram are valid until mid-2014 in most European countries. Nonetheless, once momentum builds, it may be difficult to stem the tide of generic competition.

Lundbeck says it has gone to, or is going to, court to defend its patents in more than a dozen countries, including Belgium, Brazil, Canada, Denmark, France, Germany, Israel, the U.K. and the U.S.

And the company has left unchanged its financial guidance for 2010, in which it predicts that it will have sales of DKK 14.3 billion to 14.8 billion and have an EBIT of DKK 3.0 to 3.4 billion, compared with revenues of DKK 13.7 billion and an EBIT of DKK 2.8 billion in 2009.

U.S. Focus To Business Strategy

As well as resisting generic challenges to its leading product, Lundbeck's business strategy also includes building its U.S. business and focusing on the development of novel products in its area of specialization - depression, anxiety and psychotic disorders.

Last year, it acquired Ovation Pharmaceuticals in order to extend its reach in the U.S. and to acquire a portfolio of products (Also see "Lundbeck Looks To Replace Lexapro Earnings Through Ovation Purchase" - Pink Sheet, 9 Feb, 2009.)). It also has five compounds in Phase III - Lu AS21004 for major depressive disorder; nalmefene for alcohol dependence; desmoteplase for acute ischaemic stroke; clobazam for Lennox-Gastaut syndrome; and intravenous carbamazepine for epilepsy.

However, Lundbeck's R&D progress has been not without disappointments. It has to conduct extra clinical studies with Lu AS21004, at higher doses, to see if that can improve efficacy. The company also received a complete response letter from the U.S. FDA last year for Serdolect (sertindole), which is highly efficacious in schizophrenia, but is also associated with cardiovascular risks (Also see "FDA Complete Response Slows Down, But Won't Stop, Lundbeck's Serdolect" - Pink Sheet, 25 Jun, 2009.). The FDA would like Lundbeck to identify a target population for the product.

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- John Davis (j.davis @elsevier.com)