Patent battles could savage drugs giant

By Danny Fortson

Nearly a quarter of the turnover of AstraZeneca, the FTSE 100 drugs giant, could be wiped out by legal challenges to the protection on its best-selling drugs.

The company is fighting lawsuits brought in the US and Europe by makers of cheap generic drugs which are challenging the patents of drugs that represent at least $7.2bn (£3.7bn) in annual sales, according to SG Cowen, an American investment bank. That is equivalent to 27 per cent of the company's $26.4bn annual turnover.

AstraZeneca, like other drug giants, relies on patents that give it the exclusive right to make and sell the drugs it invents, often for 10 to 15 years. Generics companies make cheap copies of branded drugs once they lose patent protection. Increasingly, they are challenging the validity of these patents years before they expire, leading to a record number of patent lawsuits. Ken Cacciatore, one of the analysts who wrote the Cowen report, estimates that, in the US alone, 36 major patent challenges threaten more than $53bn in annual sales.


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