Watson Pharmaceuticals Inc.
) recently announced that it has filed an Abbreviated New Drug
Application (ANDA) with the U.S. Food and Drug Administration (FDA)
for the approval of a generic version of
) ulcerative colitis drug, Lialda.
In response, Shire along with Cosmo Technologies Ltd., and
Guiliani International Ltd. filed a suit against Watson Pharma in
the U.S. District Court for the Southern District of Florid, to
prevent the generic company from commercializing its generic drug
prior to the expiration of Lialda's patent. Since the lawsuit was
filed under the provisions of the Hatch-Waxman Act, the FDA cannot
approve Watson Pharma's ANDA for up to 30 months from the date that
Shire received notice of the ANDA filing or until final resolution
of the matter before the court, whichever occurs earlier.
According to the IMS Health data, sales of Lialda in the U.S.
amounted to $390 million for the 12 months ended March 31,
Last month, Watson Pharma was in another patent infringement
lawsuit, when the company announced the filing of an ANDA with the
FDA for a generic version of
) diabetes drug, Glumetza. The drug is used as an adjunct to diet
and exercise to improve glycemic control in adults with type II
In response, Depomed and Valeant International together filed a
lawsuit against Watson Pharma in the U.S. District Court for the
District of Delaware, to prevent Watson Pharma from commercializing
generic Glumetza before the patents expire.
We currently have a Neutral recommendation on Watson Pharma. The
stock carries a Zacks #2 Rank (Buy rating) in the short run.
We expect the new generic product launches over regular
intervals to help drive sales of the company's Global Generic
segment, which climbed 86% in the first quarter of 2012 to $1.12
DEPOMED INC (DEPO): Free Stock Analysis Report
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