(Reuters) - A U.S. appeals court on Thursday said Eli Lilly and Co may block Teva Pharmaceutical Industries Ltd from selling a generic equivalent of its top-selling lung cancer drug Alimta, in a closely-watched patent case.
The U.S. Court of Appeals for the Federal Circuit let stand a lower court finding that Teva and other defendants would be liable for inducing infringement by doctors who prescribe generic versions of Alimta.
Writing for a three-judge panel, Chief Judge Sharon Prost said evidence that Teva's proposed product labeling for its generic would lead some doctors to infringe the Lilly patent "establishes the requisite intent for inducement."
Teva spokeswoman Denise Bradley said the Israel-based generic drugmaker is disappointed with the decision, which upholds rulings by U.S. District Judge Tanya Walton Pratt in Indianapolis.
Alimta, whose chemical name is pemetrexed, is Lilly's top-selling oncology drug, accounting for sales of $1.74 billion in the first nine months of 2016, and for 11 percent of Indianapolis-based drugmaker's total revenue.
The so-called vitamin regimen patent in question covers a method in which patients take folic acid and vitamin B12 prior to Alimta, to reduce the drug's toxicity and allow it to interrupt the ability of cancer cells to reproduce.
Michael Harrington, Lilly's general counsel, said in a statement the company is pleased with Thursday's decision.
Lilly said the patent gives it the right to block U.S. sales of generic Alimta until May 2022. It has warned that the loss of this right could have significantly harmed its financial results this year.
A separate patent for the drug expires on Jan. 24.
Bernstein analyst Tim Anderson in a research note said that a loss of patent protection for Alimta could reduce Lilly's profits by 15 percent through 2022.
In midday trading, Lilly shares were up $1.75, or 2.3 percent, at $77.01.
The case is Eli Lilly and Co v Teva Parenteral Medicines Inc et al, U.S. Federal Circuit Court of Appeals, No. 2015-2067.
Reporting by Jonathan Stempel and Bill Berkrot in New York, editing by G Crosse