The US Federal Court on 10 March dismissed AstraZeneca’s patent lawsuit against Dr Reddy’s Labs over the generic formulation of AZN’s Prilosec OTC (CY2008 sales of US$271mn). The court dismissed the case after agreeing with the defendant that DRL used a different form of Omeprazole Magnesium (the primary ingredient in Prilosec), and hence does not infringe on AZN’s patent. An FDA approval of DRL’s ANDA would permit DRL to launch generic Prilosec OTC in the US market.
The court’s ruling clears a major hurdle for DRL in launching a generic version of Prilosec OTC. This reaffirms our analysis that DRL is on course to post 8% sales growth (on the large base of FY09E) in the US market, and total sales growth of 10% for FY10E.