The long legal battle over Taxol (paclitaxel) that lasted more than 4 years and threatened generic paclitaxel almost to the last moment now appears to be resolved. In late January, Bristol-Myers Squibb and Ivax Pharmaceuticals, the major combatants, reached a settlement, saving Ivaxs cheaper generic version from removal from the market.
Although a third warring party, American BioSciences Inc. (ABI), remains defiant, generic sales of a drug that Bristol marketed exclusively for almost 8 years now seem secure. But a Federal Trade Commission investigation into Bristols actions continues, and the saga demonstrates how far drug companies will go to maintain a market monopoly.
Paclitaxel was developed mostly in the public domain by the National Cancer Institute beginning in the 1960s. An NCI-sponsored plant screening program led to the discovery that the bark of the Pacific yew tree possessed anticancer activity. The compound responsible was isolated and its structure determined, but development lagged until the late 1970s when Susan Horwitz, Ph.D., of the Albert Einstein Medical Center showed that the drug worked by binding with microtubules and preventing their degradationa unique mechanism of action. The NCI subsequently sponsored all preclinical and clinical studies of the drug, which proved especially effective against ovarian cancer. To commercialize Taxol, the NCI signed a cooperative agreement with Bristol in January 1991. The U.S. Food and Drug Administration approved Taxol for marketing in December 1992.
Since Taxol had not been patented, Bristol received 5 years of marketing exclusivity. At the time, company officials assured Congress that they could not block generic competitors once the 5-year period was over. Bristols Zola Horovitz testified to Congress in 1993 that "Taxol was never patented and no patent is possible."
Blocking Generics
But even as Horovitz spoke, Bristol was already applying for Taxol use patents. In 1997 the company used these patents to block introduction of Ivaxs generic paclitaxel. Under the Hatch-Waxman Act of 1984 (which codified the current system of generic drug approval), if the patent holder sues the generic drug applicant, the FDA cannot approve the generic drug application for 30 months, regardless of the merit of the lawsuit. Bristol thus automatically obtained a two-and-a-half-year extension on its patent, despite the fact that its key patent claims were later found invalid by a federal court. Use of this Hatch-Waxman loophole to extend drug exclusivity is known as "evergreening."
Bristol plotted an evergreening strategy from the start, Ivax claimed. "Bristol has done everything possibleregardless of legality or the public interestto extend its monopoly for Taxol," the company charged in a court filing. (Bristol denied the charges, but declined to comment for this story.) "Under federal drug laws, the mere existence of Bristols patents, however invalid, caused the extension of Bristols monopoly by delaying the introduction of generic competition."
Thirty months passed. What happened then became the subject of protracted lawsuits in four states and an ongoing government investigation. On Aug. 11, 2000, ABI filed suit against Bristol in California for patent infringement. Six days later the parties settled, and Bristol agreed to list ABIs patent under Taxol in an FDA record known as the "Orange Book." With its patent listed, ABI could sue Ivax for patent infringement and (in theory) trigger another automatic 30-month delay for the generic drug.
Ivax claimed that Bristol and ABI staged a "sham" lawsuit and settlement. "Bristol and ABI agreed to participate in the litigation disguised as adversaries when, in fact, the lawsuit was a collusive effort intended to extend Bristols monopoly over Taxol still further," the company charged. Bristol and ABI were "make-believe adversaries, secretly conspiring."
Legal Maelstrom
ABIs patent was for a version of Taxol without the toxic solvent cremaphor (castor oil). But its case against standard Taxol rested on subsidiary claims for "unit dosage forms," single "vessels" containing high doses of any Taxol. Ivax called the claims "frivolous," saying they amounted to claiming that ABI "invented the idea of putting Taxol in a bottle." A California federal court invalidated these claims to generic Taxol in December 2001. (ABI has filed a motion for reconsideration.)
ABI strongly denies entering into any collusion or conspiracy with Bristol. "ABI at all times has provided the opportunity to Ivax to license [our patent]," said ABI founder and principal Patrick Soon-Shiong, M.D.
Staged or not, the ABI-Bristol lawsuit almost succeeded in blocking generic Taxol for 30 more months. Only after Ivax intervened in the case and the FTC submitted an amicus brief announcing an investigation into Bristols and ABIs conduct did the presiding judge throw out the lawsuit and settlement. On Sept. 15, 2000, the FDA approved Ivaxs version of the drug, called Onxol.
At that point, the lawyers took over. ABI immediately sued the FDA and Health and Human Services Secretary Donna Shalala in Washington, D.C., seeking revocation of Onxols drug approval. ABI sued Ivax in California, and Ivax countersued. Bristol-Myers sued Ivax in Miami, and Ivax countersued again.
Large sums of money were at stake. As Bristols top-selling anticancer drug, Taxol brought in $1.6 billion worldwide in 2000. Since Onxols introduction late that year, the generic has captured more than 30% of the U.S. paclitaxel market. Mylan and Bedford Laboratories have also since begun marketing generic paclitaxel. Two and a half more years of exclusivity could have provided Bristol an extra $1 billion.
Bristol Backs Off
But Bristol, with the FTC on its back and its public image tarnished from its highly aggressive legal tactics, decided to back off. The legal denouement came quickly last month. In November, a federal appeals court reversed a lower courts decision and ordered the FDA to revoke Ivaxs drug approval, seemingly handing victory to ABI and Bristol. But in mid-January, the California court invalidated ABIs patent claims against Ivaxs Onxol. Then, on Jan. 25, Ivax announced the settlement with Bristol. Bristol agreed to delist the ABI patent from the FDAs Orange Book, and Ivax agreed to drop its pending counterclaims against Bristol. Other terms, including financial compensation, were not disclosed. In late January, the same day it revoked Onxol approval to comply with the appeals court decision, the FDA re-approved the drug, since ABIs patent was no longer in the Orange Book to challenge Onxol. "Our paclitaxel product is on the market to stay," said Ivax president Neil Flanzraich in a press release.
Coming so soon after ABIs appeals court victory appeared to give Bristol its Taxol monopoly back, Bristols surrender surprised observers. "I didnt know that Bristol would do that," said Clay ODell, director of public affairs for the Generic Pharmaceutical Association. "It sounds like Bristol is trying to back away from some of their legal tactics." The ongoing FTC investigation probably forced Bristols hand. "Taxol was right up there in the investigation," said ODell. "[The settlement] was probably no coincidence."
ABI, however, was not party to the settlement, remains in litigation with Ivax, and still hopes to follow up on its appeals court victory. It is possible that ABI could again challenge Onxol, although the company must now fight both Ivax and Bristol. Bristol is "hanging ABI out to dry," commented ODell. And with ABIs patent out of the Orange Book, noted ODell, "theres no more case" against Onxol.
Changing the Law
An embattled ABI stresses its ongoing work on an improved version of paclitaxel to benefit patients. "Its our goal not to prevent generic Taxol from being marketed, but to find ways to improve delivery of that drug," Soon-Shiong said. ABIs cremaphor-free paclitaxel, ABI-007, uses albumin nanoparticles as a delivery vehicle for the drug, allowing much higher doses andthe company expectsgreater efficacy. ABI-007 is now in phase III trials.
The Taxol case has had wider repercussions. Last year senators Chuck Schumer (D-N.Y.) and John McCain (R-Ariz.) introduced legislation to eliminate the automatic 30-month stay for generic drugs when nuisance lawsuits are filed. The bill, which should reach committee this year, seeks to end brand-name drug "evergreening." But theres been no official re-examination of the process that ended up handing Bristol-Myers almost 8 years of marketing exclusivity for Taxol. "The whole thing was a sweetheart deal," said James Love, director of the Taxpayer Assets Project in Washington, D.C. Meanwhile, the FTC investigation continues. The Taxol story appears far from over.
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