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August 05, 2013

Comments

While the decision may make sense given the evidence, what makes less sense to me is why the parties went to litigation battle over something that seems relatively insignificant.

The patent at the time the lawsuit was filed was going to expire in about 1.5 years. Even if Teva began marketing the drug prior to the patent's expiration, the plaintiff would unlikely to have lost much revenue stream to justify the expenses associated with the lawsuit.
On the other side, it seems that Teva could simply have assured BMS that it would not market the drug until after the patent's expiration, subject to non-disclosure agreement.

Unless BMS, through this lawsuit, would substantially delay Teva from marketing the drug in the UK after the patent's expiration, in which case BMS would still retain a monopoly on sales, the decision to litigate over this makes little sense to me. Of course I am probably missing a lot in my cursory analysis of this.

Igor:

1. Under the English rules in litigation, the loser generally pays the winner's costs; so if BMS were to sue and win, as it did, its out-of-pocket costs of doing so would be greatly reduced. And since this was not a full-blown infringement trial, costs would be lower anyway.
2. I don't know what BMS's revenues from efavirenz would be for 21 months at the end of the patent life, which is frequently when revenues are highest; but I am prepared to bet they are non-trivial, and a lot larger than Teva's expected revenues from selling the generic.
Those two make it worthwhile for BMS to sue absent assurance from Teva that it would not start selling at-risk.
I have no idea why Teva did not offer the assurance sought.

Derek,

You are right, I forgot that loser pays under the British legal system.

Why are the revenues highest during this
period?

I would think Teva didn't offer such assurances, because they couldn't so assure. :)

The fact that Teva spent considerable resources to contest the injunction provides an equally "concrete inference" of their intentions -- a bit of a Catch-22, is it not? How can you contest such an injunction without creating an inference that it's justified?

I assume that Teva could get the injunction lifted only by proving the relevant patent claims invalid, which is not an option on this timescale. If so, the Merck/BMS strategy might catch on.

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