After battling to be first to market with their next-generation cholesterol-fighting drugs, Amgen is fighting rival Sanofi and its partner Regeneron Pharmaceuticals over the patents behind the drugs. Round one just went to Amgen (NASDAQ: AMGN).
A jury in a U.S. district court in Delaware has ruled that alirocumab (Praluent), from Sanofi (NYSE: SNY) and Regeneron (NASDAQ: REGN), violates patents granted to Amgen, whose rival drug is called evolocumab (Repatha). Both antibody-based drugs block a protein called PCSK9 and help patients flush excess LDL, the so-called bad cholesterol, out of the blood stream.
Sanofi, of Paris, and Regeneron, of Tarrytown, NY, said in a press release they would appeal the verdict. Even with an appeal, a hearing to decide on a permanent injunction—whether Regeneron and Sanofi should be forced to stop selling alirocumab—will take place March 23 and 24. The jury has not yet awarded damages or royalty payments to Amgen, based in Thousand Oaks, CA.
Biotech patent fights are often settled, with one party paying royalties to another. Mark Schoenebaum, a biotech analyst at Evercore ISI, noted that Regeneron in 2012 settled a patent dispute with Roche’s Genentech over an eye drug, agreeing to pay about a 5 percent royalty. If a similar royalty came into play with the PCSK9 fight, it would represent about $106 million of Regeneron’s U.S. alirocumab sales in 2020, Schoenebaum estimated in a research note. Both companies priced the drug around $14,000 for a year’s worth, before discounts. Sales out of the gate, however, have been slow. As noted here, analyst forecasts of drug sales can often be far too rosy.
The stakes are high enough that Regeneron and Sanofi paid $67.5 million in 2014 for a voucher that let them speed up the FDA review of alirocumab by a few months, a sign that the partners believed those few months—and a slight head start against Amgen—could return to their bottom line more than the outlay.
Amgen sued the partners in 2014. Alirocumab and evolocumab came to market in the U.S. and Europe the summer of 2015 within a couple months of each other. They both were approved to treat patients who need more than the commonly prescribed statins to lower dangerously high levels of cholesterol.
They have also been prime targets of critics who feel drug prices have gotten out of control. Drug-buying middlemen, called pharmacy benefit managers, have vowed to limit their purchase of the drugs until larger studies, still underway, can show that lowering people’s cholesterol by blocking PCSK9 actually saves lives. Those studies will start providing data later this year and into 2017.