The U.S. District Court for the District of New Jersey has ruled against Eli Lilly finding that the method-of-use patent for its ADHD drug Strattera is invalid. The patent had been set to expire in May of 2017. Lilly is planning an immediate appeal. As a result of the court’s decision, Lilly anticipates the near-term entry of generic atomoxetine in the U.S. market but it will not cause the company to modify its current 2010 earnings per share guidance, expecting revenue growth in the low- to mid-single digits, a reduction from its prior revenue growth guidance of mid-single digits. Both Teva Pharmaceuticals and Novartis have generic versions of Strattera ready to launch. Lilly CEO John Lechleiter assured investors, however, that the company is taking necessary actions to meet the challenge of the expected loss of revenue, including lowering its cost structure by at least $1 billion by the end of 2011 and reducing its full-time workforce, a plan first announced last September when Lilly said it would cut 5,500 workers worldwide by 2011. Last month, the company disclosed that it had cut about 2,100 full-time employees since their announcement.

Cardiome Pharma gave investors updated guidance regarding a key pivotal trial of its lead oral vernakalant development program in its second quarter financial report for the period ending June 30, 2010. The company said that, based on recent discussions with its development partner Merck, a phase 3 trial of oral vernakalant would not begin this summer, as previously expected. Cardiome did not give a revised timeline and said only that “Merck continues to work toward optimizing the clinical development plan for vernakalant (oral), and Cardiome will provide updated guidance when Merck has finalized their planning.” Vernakalant is being developed, both as an injectable and an oral delivery, as a potential treatment for irregular heartbeat. European approval of injectable vernakalant is expected by early 2011. Shares of Cardiome closed down 13 percent on the news.

Curis said that its collaborator Roche informed it that preliminary findings from the analysis of a mid-stage trial of its experimental drug, GDC-0449, needs additional study to clarify and interpret potential clinical activity. The drug, a first-in-class Hedgehog pathway inhibitor, was tested as a single agent maintenance therapy for ovarian cancer patients in their second or third complete remission from the disease. Roche plans to further analyze the data in the coming months. Following this the company expects to make a portfolio decision regarding whether, or to what extent, they will continue development of GDC-0449 in advanced ovarian cancer. The drug is being tested in several other cancers, but the news added pressure on Curis, which saw its share tumble two months ago when it announced the failure of the drug in a mid-stage trial in colorectal cancer patients.
Gilead Sciences said the U.S. Food and Drug Administration may issue it a warning letter following inspections earlier this year at a manufacturing and distribution facility in San Dimas, California. The company made the disclosure in its quarterly filing with the Securities and Exchange Commission. At the conclusion of that inspection, the FDA expressed concerns over the maintenance of aseptic processing conditions in the manufacturing suite for Gilead’s antifungal AmBisome; environmental maintenance issues in the San Dimas warehousing facility; batch sampling; and the timeliness of completion of annual product quality reports. The company said it believes that it has addressed all of the concerns raised by the agency, but if a warning letter is issued, it could hamper its ability to produce enough of AmBisome and certain other products to meet market demand.

DUSA Pharmaceuticals said it will stop its Levulan photodynamic cancer trial following the U.S. Food and Drug Administration’s denial of granting the drug orphan status. The company was testing the therapy for the prevention of cutaneous squamous cell carcinoma (SCC) in patients with a history of multiple localized cutaneous SCCs over a 12 month period. The company said the agency acknowledged that cutaneous SCC is a serious problem in patients at high risk for developing SCCs, such as solid organ transplant recipients, and that aminolevulinic acid would be a potential preventative therapy in these patients. However, the FDA said that it believes there are other factors, which place patients at high risk of developing SCCs that should be included in determining the target population. To be eligible for Orphan Drug Designation, the drug must target a disease that affects fewer than 200,000 patients in the United States. “Without the regulatory protection and development opportunities that Orphan Drug Designation affords our resources are better utilized in other areas,” said Robert Doman, DUSA's president and CEO.

Amgen said top-line results from a randomized phase 3 trial, evaluating Vectibix as a first-line treatment in patients with recurrent and/or metastatic squamous cell head and neck cancer showed the addition of Vectibix to platinum-based chemotherapy did not result in a statistically significant improvement in overall survival, the primary endpoint, compared to chemotherapy alone. Secondary endpoints of progression-free survival and objective response rate were numerically improved but were not tested for statistical significance.

An activist Elan investor has raised concern over a potential conflict of interest in the matter of Elan selling U.S. rights to the pain drug Prialt to Azur Pharma International at a bargain basement price. In a letter posted on saveelan.com, Id Sonderby, who controls more than 2 million Elan shares, told fellow shareholders and interested parties that he had not yet received a response from the Elan board as to the stake certain Elan directors hold in privately-held Azur. Elan revealed in a recent filing that it sold the rights for about $14.6 million, a price that was not disclosed at the time of the March deal. Elan has confirmed that three of its directors hold Azur shares. Through his own investigation, Sonderby says that Elan’s chairman, Kyran McLaughlin, is vice chairman of Davy Stockbrokers, an entity that holds approximately 44 percent of Azur Pharma. Sonderby says that Elan sold EU rights for Prialt to Japan’s Eisai for $100 million. Prialt enjoys U.S. patent protection until 2015 and feels U.S. rights are more valuable. He plans to release the findings of his investigation soon and will nominate his own slate of candidates to replace current directors on the board. Elan has not issued any comments.