April 5, 2012 / 6:27 PM / 5 years ago

Mylan sues FDA over Teva's generic sleep drug

April 5 (Reuters) - Mylan Inc is suing the U.S. Food and Drug Administration for granting Teva Pharmaceutical Industries Ltd the exclusive right to sell a U.S. generic version of the blockbuster sleep-disorder drug Provigil.

Earlier on Thursday, Teva, the world’s largest generic drugmaker, said the FDA had decided the company was entitled to 180 days as the exclusive seller of a generic version of Provigil, also known as modafinil. Such an exclusivity period is typically awarded to the company that first challenges the patents on a brand-name drug.

Teva said it started selling its generic last Thursday.

The Provigil situation is unusual because Teva acquired the drug’s maker, Cephalon, for $6.8 billion last year to build its brand-drug franchise.

Mylan, the world’s No. 3 generic drugmaker, said on Thursday that since Teva could not infringe its own patents, it was not entitled to the exclusivity. Mylan, in a lawsuit filed in the U.S. District Court for the District of Columbia, is seeking an immediate order entitling it to exclusivity and immediate approval for its generic Provigil application.

Erica Jefferson, spokeswoman at the FDA, said the agency does not comment on pending litigation.

Provigil had U.S. sales of about $1.1 billion last year, Mylan said, citing data from IMS Health.

Generic Provigil could add $50 million to $60 million to Teva’s revenue in the second and third quarters, according to JPMorgan analyst Chris Schott.

Schott, in a research note, said of the FDA’s decision on Teva, “Given that we had previously assumed several more players at market formation, we see this as a nice incremental positive for Teva.”

Mylan shares were down 2.4 percent on Thursday. Teva shares were up 0.3 percent.

Shares of smaller generic drugmaker Par Pharmaceuticals were up 4.3 percent. Teva said Par was expected to launch its own generic version of Provigil on Friday as a result of Teva’s agreement with U.S. antitrust regulators to gain clearance for the Cephalon deal.

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