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King Pharmaceuticals plans to appeal loss of patent for Skelaxin

Jeff Keeling • Jan 21, 2009 at 12:00 AM

BRISTOL, Tenn. — The branded muscle relaxer Skelaxin, which accounted for about one-fourth of King Pharmaceuticals’ revenue last year, may hit the generic market sometime this year after a patent ruling in New York. But a King official said the company is prepared to weather that storm should it lose an appeal.

“That’s currently our largest-selling product,” King spokesman James Green said Wednesday. “Once it goes generic it will not produce revenues anywhere near what it has been.”

(From January to November 2008, Skelaxin contributed about $333 million to King’s $1.22 billion in revenues.)

Eon Labs has won a bid in New York federal court to have two patents on Skelaxin overturned, though Green said the company will appeal once a summary judgment issued this week becomes a “final order.”

King already has an agreement with another generic producer, Corepharma, that will allow it to sell a generic version of metaxalone (Skelaxin’s active ingredient) starting in December 2012. Green, King’s executive vice president for corporate affairs, said King’s legal team is preparing its appeal and that it was “too early to speculate” when Eon might put a generic on the market should King lose.

“Right now we plan to vigorously defend the patent, and it’s going to take some time even to go through that process,” Green said.

He said King’s recent purchase of Alpharma, another drugmaker — along with King’s ongoing research and development of new proprietary drugs — will help it stay strong even if it loses the Skelaxin appeal.

“You’ve got to continue developing new products because products have limited lives (due to patent expirations or successful challenges),” Green said. “We do that through our own research and development, and we also do that through business development, such as the acquisition of Alpharma.

“That really helped to diversify our business and offset risks such as generic competition entering against Skelaxin.”

King’s primary R and D centers around abuse-resistant painkillers.

Last month, the Food and Drug Administration delayed approval of Remoxy, an abuse-resistant oxycodone treatment, pending further non-clinical data.

An Alpharma product King is trying to get approved, Embeda, is a morphine-based drug with abuse-resistant properties.

King, which employs about 500 people at its Bristol headquarters, survived an even bigger hit in September 2007 when its hypertension drug Altace went generic, Green said.

Though continued development of “intellectual property” related to Skelaxin has extended its patents out to 2021, Green said challenges designed to move it to the generic market have been in the works since 2003.

“We’ve been aware of these risks and have been working very diligently to continue developing new products ... that will replace products such as Altace, and eventually products such as Skelaxin,” Green said.

According to a Reuters article, a market analyst predicted that generic competition will come sometime around the end of this year and would have “a severe impact” on 2010 earnings at King, but said since generic competition has been expected for some time it would not be “a complete disaster for King.”

If Eon wins its bid, Corepharma also will be able to begin selling its version, although Corepharma’s agreement with King for an “authorized” generic version will provide King a portion of profits.

Green said King’s “integration” of Alpharma during 2009 should result in money-saving efficiencies as King cuts duplication that existed when Alpharma was a separate company.

Alpharma also has a steady income stream from animal pharmaceuticals that will help King.

The key for the long term is successful development and approval of new drugs, and Green said King continues trying to carve a niche in abuse-resistant painkillers. Acurox, a short-acting formulation of oxycodone, is another that King hopes to hear positive news on in 2009.

“We have an entire portfolio of opioids that we’re developing that are designed to deter common methods of abuse and misuse, and we’re a leader in these types of products,” Green said.

The news of the patent invalidation sent King’s stock down more than 7 percent in early morning trading, but it recovered through the day to close down 3.3 percent at $8.70 a share.

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