C&EN: TODAY'S HEADLINES - GLAXO SUES OVER TRADE SECRET

PATRICIA SHORT

GlaxoSmithkline has filed suit in district court in Broomfield, Colo., against Novartis and two of its subsidiaries—Geneva Pharmaceuticals and Biochemie. GSK charges there is a high probability that the bacterium the companies are using to produce generic versions of the antibiotic Augmentin was stolen.

GSK has also filed similar suits in a Philadelphia county court against India’s Ranbaxy Laboratories and Israel’s Teva Pharmaceuticals. The bacterium was allegedly stolen by a former GSK employee; none of the suits accuses the defendants of being involved in the theft.

GSK argues that the companies are using a stolen bacterial strain—which it calls a trade secret—to produce potassium clavulanate. That compound in combination with the antibiotic amoxycillin makes up GSK’s blockbuster drug Augmentin.

The companies being sued respond that the charges are unfounded. For example, Novartis says in a statement that it is “confident that the lawsuit will show Novartis companies acted in a legally and ethically correct manner.”

Although a trade secret is not patent protected, it also won’t expire this year, as GSK’s U.S. patents have. The company is being sued by other pharmaceutical producers—including Geneva—over its attempts to extend patent life for Augmentin.

Generic versions are already on sale in Europe, and Novartis’ Geneva unit began selling generic versions of Augmentin in the U.S. this summer, after GSK’s basic patent expired in May. GSK has asked the U.S. International Trade Commission to block imports of those generic versions of the drug.

GSK’s sales of Augmentin last year were roughly $1.8 billion, making it the company’s second-largest-selling item, after its Seroxat antidepressant. Some securities analysts predict that the sale of less expensive generic forms of Augmentin will dramatically cut into GSK’s sales and earnings for this year.