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Judge Says Maker of OxyContin Misled Officials to Win Patents
By GARDINER HARRIS
urdue Pharma, the maker of the highly profitable painkiller OxyContin,
deliberately misled federal officials to win patents
protecting its drug, a federal judge ruled yesterday. The
ruling helps clear the way for a cheaper generic version and could
lead to more lawsuits.
The decision by Judge Sidney H. Stein of Federal District Court in Manhattan
came in response to a suit brought by Purdue against
Endo Pharmaceuticals Holdings, which had filed an application to
sell a generic version of OxyContin. Robin Hogen, a Purdue
Pharma spokesman, said the company was "surprised and disappointed"
by the ruling and planned to appeal.
The ruling spells trouble for Purdue, which derives more than 70 percent
of its $1.8 billion in annual revenue from OxyContin.
Generic pills often grab 80 percent of a branded drug's sales within
just a few months. When Endo introduces its pill, much of
Purdue's business could disappear. And two more generic
companies are waiting to introduce their versions of the pill.
But that is not the end of problems for Purdue, which is a closely
held company based in Stamford, Conn. Judge Stein's finding that
Purdue deliberately misled the United States Patent Office could lead
to lawsuits from state attorneys general and consumer groups
contending that Purdue's actions cost American consumers billions
of dollars. Mr. Hogen of Purdue denied that the company had
misled the Patent Office.
Steve Berman, a lawyer for the Prescription Access Litigation Project,
said that Judge Stein's summary of the OxyContin patent
case described "a classic situation that I'm sure will result in litigation
in the imminent future."
"P.A.L.'s whole mission is to spot these kinds of cases and institute
litigation on behalf of consumers," Mr. Berman added.
In a similar case, the Bristol-Myers Squibb Company agreed a year ago
to pay $670 million to settle claims that it improperly
stymied generic versions of two medicines. Purdue's introduction of OxyContin
is based on the simple idea that patients suffering
from chronic pain like to get a full night's sleep. Oxycodone, a popular and
powerful narcotic, is effective for only four to five hours.
OxyContin delivers a steady stream of oxycodone over 12 hours. The Food
and Drug Administration approved the drug in
December 1995.
Sales took off in part because Purdue marketed the medicine aggressively.
It was soon immensely popular with addicts, who found
that snorting crushed pills delivered the full 12-hour dose instantly.
By the late 1990's, OxyContin abuse was rampant in Appalachia and other
areas where prescription drug abuse is common. It
became known as "hillbilly heroin." Some critics have attributed scores of
deaths to abuse of the pill, although Purdue disputes those
contentions.
Just as the controversy surrounding OxyContin peaked, Endo filed an
application to sell a generic version of the medicine in July
2000. Purdue sued Endo, and the case has been percolating since.
Endo said that Purdue's many patents on OxyContin were invalid. To win
its patents, Purdue told the patent office that OxyContin
was unique because 90 percent of patients taking the medicine got pain
relief by taking very little medicine - from 10 milligrams to
40 milligrams.
But during the course of the trial, Dr. Robert F. Kaiko, OxyContin's inventor,
acknowledged that he had done no clinical studies and
had no evidence to support this claim. Purdue admitted that Dr. Kaiko's
"discovery" was made solely in his head but that it was
valid even though the company was unable to prove it to be true.
Internal company documents from 1993 show that Purdue executives
concluded that the claims that the company were making for
OxyContin "weren't anywhere close" to being proved and were "clearly Bob Kaiko's
vision."
In his ruling, Judge Stein wrote that "Purdue made a deliberate decision
to misrepresent to the P.T.O. a 'theoretical argument' and
an 'expectation' as a precisely quantified 'result' or 'discovery.' "
The F.D.A. grants five years of exclusive selling rights to any drug that wins i
ts approval. After that, companies generally rely on
patents to maintain the monopolies that allow them to charge high prices.
Purdue's initial five years of exclusive selling rights ended
in 2000. Since then, it has been able to continue charging high prices for
OxyContin because of its patents - patents that were won
fraudulently, Judge Stein ruled.
Caroline Manogue, a spokeswoman for Endo, said that her company might
wait for an appeals court ruling before introducing its
version of the drug, a process that could take more than a year. After Endo
sells its version for six months, other companies can
enter the market. Teva Pharmaceuticals and Impax Laboratories both have t
entative approval from federal regulators to introduce
versions of the pill then.
Separately, Endo accused Purdue of antitrust violations, contending its
patents were illegal. Judge Stein's opinion "opens the way for
the antitrust claims to move forward," she said.
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