Drug giant Pfizer Inc. (PFE) announced a $2.15 billion settlement reached with Teva Pharmaceuticals Industries, Limited (TEVA) and Sun Pharmaceutical Industries, Limited for patent-infringement damages resulting from their "at-risk" launches of generic Protonix in the U.S. This settlement comes after a nearly 10-year legal battle in which Pfizer and Nycomed, now part of Takeda, sought to enforce the patent for its blockbuster acid reflux medicine. Pfizer and Takeda would divide the settlement proceeds with Pfizer receiving 64 percent.
Pursuant to the settlement terms, Teva and Sun Pharmaceutical would pay a total of $2.15 billion to compensate Pfizer's unit, Wyeth and Takeda, for the damages they suffered when Teva and Sun introduced "at-risk" generic versions of Protonix prior to the January 2011 expiry of the patent for pantoprazole, the active ingredient in Protonix.
Teva would pay Pfizer and Takeda $1.6 billion, whereas Sun would pay $550 million. Teva would pay $800 million in 2013 and the final $800 million by October 2014, while Sun's entire payment would be made in 2013. According to the settlement, both Teva and Sun have admitted that their sales of generic pantoprazole infringed the patent that was held valid by the court.
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