Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) received a favorable court ruling in a patent litigation case pitting it against drug company Roxane Laboratories. The suit centered on the drug Fanapt, a schizophrenia antipsychotic.
Judge Gregory Sleet of the U.S. District Court in Delaware sided with Vanda that Roxane infringed at least two of its patents relating to Fanapt.
The complaint that Vanda brought against Roxane was that the latter submitted an application to the FDA seeking marketing approval of a generic version of Fanapt before patent protection of the drug expired.
What happens next?
Not only did Judge Sleet determine that Roxane violated Vanda’s patents relating to Fanapt, but he also issued an injunction that bars Roxane from selling its disputed drug.
The only time that Roxane will have an opportunity to market its copycat of Fanapt is after the marketing exclusivity of the branded drug expires and that will be in a long time. Fanapt’s patents that accord it marketing exclusivity will expire on November 2, 2027.
The management of Vanda Pharmaceuticals, led by CEO, Mihael H. Polymeropoulos, said it was pleased by the court’s ruling in the matter of Fanapt and generic maker Roxane.
Fanapt is one of Vanda’s leading products. Sales of the drug brought in $18.6 million in 2Q2016, which was an increase of 9% over the sales generated in the prior quarter.
Earlier this year, Vanda got the FDA to approve a supplemental New Drug Application for Fanapt, thus expanding the use of the drug. On top of that, the FDA granted the drug three years of marketing exclusivity to reflect the changes to its label.
Vanda’s other major drug product is HETLIOZ, a Hon-24 Hour Syndrome drug, which generated sales of $17.5 million in 2Q2017, an increase of 8% from the previous quarter.
Vanda’s cash position
Vanda finished 2Q2016 with cash and equivalents of $136 million, which declined slightly from the prior quarter. The management sees cash at the end of 2016 in the range of $123 to $143 million.