UPDATE: Lupin Settles Litigation With Forest For Namenda Tablets

Indian drug maker Lupin Ltd. (500257.BY) Tuesday said it has reached an out-of-court settlement with Forest Laboratories Inc. (FRX) and can launch its generic version of the U.S.-based company's Namenda tablets by January 2015, or earlier in certain circumstances.

The company didn't elaborate on the circumstances under which the product could be launched earlier than January 2015.

While the settlement means Lupin can launch Memantine--the generic version of Namenda--before Forest's patent expires in April 2015, analysts say it's too late for the Indian company to gain significant advantage over competitors.

"If there could have been an agreement where Lupin could sell the product in 2013, or an agreement wherein Lupin would be selling some key materials to Forest Labs, then Lupin's hold would have been much more than Forest for the case," a Mumbai-based analyst, who didn't wish to be named, said.

"But now that the settlement is only for four months prior to the patent expiry, whatever money that was put in terms of litigation, that is gone. There is no return on that," he said.

Lupin shares ended down on the news, closing 3.5% lower at INR1446.70 on the Bombay Stock Exchange, where the benchmark Sensex rose 0.6%.

Namenda--used to treat Alzheimer's disease--accounted for about 26% of Forest's net sales, or $949 million in sales in the U.S., in the last fiscal year ended March 2009.

Forest has an exclusive license to Namenda from German pharmaceutical company Merz Pharma GmbH & Co. KGaA. The two companies filed patent suits in January 2008 against generic manufacturers such as Lupin, which were seeking FDA approval to market their versions of Namenda.

Lupin, along with the other Indian generic drug makers, claimed the patent was not infringed and they should be allowed to market the generic versions along with the innovator, in this case Namenda.

-By Dhanya Ann Thoppil, Dow Jones Newswires; +91-9886929464; dhanya.thoppil@dowjones.com

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