Sanofi, Bristol Win Ruling On Plavix

A federal judge granted a request by Bristol-Myers Squibb Co. and Sanofi-Aventis SA for a preliminary injunction halting sales of a generic version of their best-selling drug, but he stopped short of ordering a recall of the product and ordered the companies to post a large bond.

The ruling is a mixed bag for New York-based Bristol-Myers and Paris-based Sanofi, which have seen sales of their drug, the blood thinner Plavix, plummet since the generic version hit the market on Aug. 8.

Canadian generic-drug maker Apotex Inc. has flooded U.S. pharmacies with several months' worth of supplies of the generic, known as clopidogrel. In the absence of a recall, those supplies will continue to be sold to patients, depriving Bristol-Myers and Sanofi of hundreds of millions of dollars of revenues.

As the generic captured nearly 75% of the market, U.S. sales of branded Plavix plunged 77% to $14.4 million for the week ended Aug. 25 from $62.7 million for the week ended Aug. 4, according to market-research firm Verispan.

Bristol-Myers and Sanofi avoided the worst-case scenario: the permanent loss of marketing exclusivity over Plavix, the world's No. 2 drug with $3.8 billion in U.S. sales last year. Lipitor, Pfizer Inc.'s cholesterol drug, is the world's top seller.

Such a loss would likely have forced Bristol-Myers to cut its dividend and research-and-development budget and to lay off most of the 1,200 representatives who pitch the drug to U.S. doctors. Plavix accounts for 30% of Bristol-Myers's profits. Sanofi is less dependent on Plavix, though the drug contributes a big chunk of its earnings.

The ruling is unlikely to disperse the clouds hanging over Bristol-Myers Chief Executive Peter Dolan, whom shareholders have blamed for bungling a deal that would have kept the generic off the market.

That deal, designed to settle a patent lawsuit pitting Bristol-Myers and Sanofi against Apotex, unraveled in late July after agents from the Federal Bureau of Investigation raided the office of Mr. Dolan and one of his subordinates, Andrew Bodnar. The Justice Department is investigating whether Bristol-Myers and Sanofi struck a side deal with Apotex that they hid from regulators.

Bristol-Myers lawyers have denied the existence of any side deal, but Apotex lawyers have said Mr. Bodnar and Apotex CEO Barry Sherman did agree to one orally. Bristol-Myers lawyers say Apotex's allegation is untrue and was designed to sabotage the settlement, so that Apotex could launch its generic under favorable conditions.

Bristol-Myers shares have fallen nearly 20% since the deal blew up. Yesterday, they fell 23 cents to $21.75 in 4 p.m. New York Stock Exchange composite trading. In after-market trading, they rose $1.97 following news of the ruling.

U.S. District Judge Sidney Stein asked Bristol-Myers and Sanofi to post a $400 million bond to compensate Apotex for its lost sales in the event that the Canadian company ends up winning the patent suit. Apotex had asked for a $4 billion bond if the judge granted the injunction.

Apotex said it would appeal Judge Stein's ruling and was filing an emergency motion to stay the injunction pending the appeal.

Legal experts say Apotex is unlikely to win the case. In his ruling, Judge Stein said Bristol-Myers and Sanofi had adequately demonstrated that questions Apotex raised as to the validity of Sanofi's patent were without substantial merit.

Bristol-Myers and Sanofi have been forced to offer rebates on branded Plavix to compete with the generic. Apotex's product has been selling for about $124 for 30 pills, compared with $148 for a month's supply of the branded version.