Real Threat To Glaxo's Zantac Patent Is Possible

Glaxo's recent decision to cut the price of its leading antiulcerant Zantac (ranitidine) by 30% in Germany in the face of generic competition (Marketletter July 10) is seen as "trivial" by analysts at Lehman Brothers. They suggest that the impact of this price cut would be no more than $30 million on the pretax line.

The underlying and much more serious problem, they point out, is that the German generics company Hexal has a novel patent to produce a different crystalline structure of Form 1 Zantac, thus possibly avoiding any infringement of the Form 2 patent. Glaxo has always argued that it is impossible to produce the Form 1, the patent on which expires in Germany on July 28, without breaching the Form 2 patent.

It is highly likely that Boehringer Ingelheim, which has filed a generic Zantac Abbreviated New Drug Application in the USA, has licensed the Hexal product and may be able to demonstrate there is no infringement of the Form 2 patent and launch as soon as the Form 1 patent expires in the USA in 1997.