Divi’s Laboratories is the Active Pharmaceutical Ingredient (API) supplier for Novartis’s Entresto.
This ruling is expected to pave the way for generic competition in the near term.
Analysts suggest that the entry of generics could affect the volume offtake for Divi’s Laboratories.
The US Court of Appeals for the Federal Circuit upheld a Delaware federal judge’s August decision that found Novartis failed to prove it was likely to win a patent lawsuit against MSN over the drug, removing a roadblock for MSN’s launch of what would be the first US Entresto generic.
Novartis said in a statement that it disagrees with the ruling and is “considering all available options to vigorously defend our intellectual property rights, including further appellate options.”
Entresto is Switzerland-based Novartis’ best-selling drug, bringing the company more than $6 billion in revenue last year. MSN’s version of Entresto was approved by the US Food and Drug Administration in July.
Novartis had sued MSN and others seeking to launch Entresto generics in Delaware federal court in 2022 for allegedly infringing a patent that expires in 2026. It requested a preliminary injunction after the FDA’s approval that would block MSN from launching its generic during the case, which is set to go to trial on Monday.
US District Judge Richard Andrews rejected Novartis’ request in August, ruling that it was not sufficiently likely to win on its infringement claims to justify the injunction. The judge paused MSN’s launch of its proposed generic while Novartis appealed to the Federal Circuit.
The Washington-based appeals court affirmed Andrews’ decision on Wednesday and said it saw “no clear error in the district court’s analysis.”
In response, Divi’s Laboratories said that it is a Contract Manufacturing Organization and manufacturer of Active Pharmaceutical Ingredients and in the normal course of business, it has supply agreements with some of its customers.
It said that there is no material impact on the company due to this news.
“We hereby clarify that we cannot comment on the patent lawsuits of big pharma companies and its impact on them,” Divi’s Laboratories said.
“There are first signs of profit booking here. while the medium-term to long-term chart remains good, in the short-term the stock is signaling loss of momentum and could go into consolidation. If people are long here, exit, get profit, wait it out, the stock could be available between ₹5,800-5,750 again, that is the area to enter,” said Technical Analyst Mitessh Thakkar.
Shares of Divi’s Laboratories Ltd. are currently trading 3.25% lower at ₹6,052.95. The stock has gained about 55% so far in 2024.
