Delayed launch of Glumetza: Lupin settles case for $248 million
The law suits in US courts alleged that the 2012 settlement of patent litigation regarding Glumetza delayed the availability of generic alternatives, causing consumers to pay higher prices for the drug.
September 16, 2021 / 11:48 AM IST
Drugmaker Lupin has entered into a $248-million (Rs 1,821-crore) settlement agreement with the plaintiffs in antitrust class action lawsuit against the company for the delayed launch of the anti-diabetic drug Glumetza generic in US.
The lawsuits in US courts alleged that the 2012 settlement of patent litigation regarding Glumetza delayed the availability of generic alternatives, causing consumers to pay higher prices for the drug.
Lupin has disputed these claims and defended these matters vigorously.
The trial for this case is scheduled to begin on October 4 in the US courts.
"With a view to resolve this dispute, considering that other defendants have recently settled the case and in light of the increased uncertainty, the Company has agreed to settle with the plaintiffs for an amount
of US$ 150 mn (US Dollar One Hundred and Fifty million) to the Direct Purchaser Group (subject to Court’s approval) and US$ 98 million (US Dollar Ninety Eight million) to the Retailer Opt-Out Group," the company said in a late statement to stock exchanges on September 15.
Lupin said its Board had approved the settlement.
The company further added that the settlement would not have any significant impact on the financial position of the company.
Lupin launched generic version of Glumetza (Metformin extended release tablets) in February 2016. Generic Glumetza was one of the top selling drug for Lupin for next several quarters in US.
"The company cash (including cash equivalent and investments) as of March 2021 was at $566 million. Lupin will generate cash $250 million cumulative over the next 2 years …. we note the settlement will be one-time impact in FY22 and no impact on our estimates for FY23/24," said Axis Capital in its note.