The Medicines Company (MDCO) received a much needed breather recently in the form of a favorable order issued by the U.S. District Court for the Eastern District of Virginia in the company’s lawsuit against the U.S. Patent and Trademark Office (PTO), the U.S. Food and Drug Administration (FDA) and the U.S. Department of Health and Human Services.
The Medicines Company is seeking to extend the term of its principal US patent for its lead product, Angiomax, which is scheduled to expire on March 23, 2010 (September 23, 2010 including six-month pediatric exclusivity).
Although The Medicines Company filed for Hatch-Watchman exclusivity in 2001, the patent extension request was filed a day late due to confusion related to the approval date for Angiomax. Since then, The Medicines Company has been petitioning the PTO to accept the late filing which was due to “unintentional circumstances.” The PTO has already rejected the company’s petition a couple of times, the latest being in Jan 2010.
However, the recent Court ruling requires the PTO to set aside its denial and reconsider the company’s application. Importantly, the Court ruled that the PTO should take necessary actions to ensure that the Angiomax patent does not expire while the proceedings are ongoing. Not surprisingly, the company’s shares were up 19% on the news.
Although the PTO could still deny The Medicines Company’s petition, the recent court ruling should give the company some breathing space as the ruling should ensure a delay in the entry of generic competition for Angiomax. Generic player Teva Pharmaceutical Laboratories Inc. (TEVA) is looking to sell generic versions of Angiomax.
In the meantime, The Medicines Company is vigorously lobbying both houses to vote on a proposed bill that would provide the PTO with discretion to consider patent extension applications that have been filed late unintentionally under the Hatch-Waxman Act.
The favorable news regarding the Angiomax patent issue over-shadowed The Medicine Company’s recent announcement regarding the voluntary recall of four additional lots of Cleviprex. Earlier in December 2009, the company had recalled eleven lots of Cleviprex.
With full year 2009 Cleviprex sales coming in at just $3 million, we consider the Cleviprex recall to be of minor significance. We expect investor focus to remain on the resolution of the Angiomax patent issues. We have a Neutral recommendation on The Medicines Company.
Read the full analyst report on “MDCO”
Read the full analyst report on “TEVA”
Zacks Investment Research