Glenmark Pharmaceuticals and Merck have agreed to settle their patent litigation on Merck’s patent covering Zetia, a cholesterol-lowering drug.
The settlement is expected to provide a one-time additional profits of around Rs 500 crore in 2016 to Glenmark.
Under the agreement, Glenmark will be able to launch Zetia’s generic version in December 2016, four-and-a-half months ahead of April 25, 2017, the day Merck’s patent for Zetia expires. The market size of Zetia in the US is estimated at around $1.4 billion (Rs 6,200 crore) per annum.
The early launch will give Glenmark Generics, the subsidiary of Glenmark Pharmaceuticals, four-and-a-half months of exclusive access to the US market for selling the generic version.
According to sources close to the development, the company is expecting to generate sale of around $250-300 million (Rs 1,100 crore-Rs1,300 crore) in that period.
The company will share the profits with US-based Par Pharmaceuticals, with which it has a pact for marketing the Zetia generic. Sources say that Glenmark is likely to get around $ 150 million (Rs 670 crore) as its share of the revenues. Cost of production is expected to be around 15-20 per cent of the sales, leaving about 80 per cent as profit before tax.