Ranbaxy to share Lipitor profits with Teva

Ranbaxy Laboratories will not make the type of money it had initially hoped for from the sales of the generic version of Pfizer's blockbuster cholesterol drug Lipitor, which went off-patent on Wednesday, as it had signed a profit-sharing deal with Israel's Teva Pharmaceuticals Ltd.

Ranbaxy agreed to share the profits during the exclusivity period of six months with Teva as part of a deal with the US Food and Drug Administration (FDA) for getting its approval to sell the drug in the US.

The FDA had blocked New Delhi-based Ranbaxy from introducing the generic version of Lipitor and from importing about 30 different drugs into the US because of manufacturing defects at its facilities in Madhya Pradesh and Himachal Pradesh, dating back to 2006.

Ranbaxy may have convinced the FDA that its generic version of Lipitor would be as good as Pfizer's original and it should not be stopped because of quality control issues at its plants in India.

Without the US FDA approval, Ranbaxy's rights to 180 days of marketing exclusivity for being the first to file a generic equivalent would have been compromised. (See: No immediate gain for Ranbaxy despite Lipitor patent's expiry).

Some media reports have suggested that Teva would supply ingredients for Ranbaxy's generic equivalent and hence the profit-sharing deal, but a spokeswoman for Teva denied the reports.