RDY - Are Amarin's Blockbuster Dreams Over?
When the U.S. Food and Drug Administration approved a widened use for Amarin's (NASDAQ: AMRN) cardiovascular drug Vascepa in December, hopes were high that it could turn into a blockbuster. However, a court ruling may have burst that bubble this week. Amarin shares sank 70% after a federal judge invalidated several patents pertaining to the drug. That means generic competitors may enter the market and take a piece of the pie sooner rather than later.
Image source: Getty Images.
In the case, Amarin sued Hikma Pharmaceuticals (OTC: HKMPF) and Dr. Reddy's Laboratories (NYSE: RDY), which are seeking approval of generic versions of Vascepa. The judge determined that Hikma and Dr. Reddy's actually infringed on Amarin's patents. But here's the key point: The judge ruled the Amarin patents are invalid because the claims are "obvious." In patent cases, "obviousness" means that other experts in the field could have easily created the particular invention based on common knowledge of the subject.