Watson Pharmaceuticals has said it is suing the US FDA over the agency's decision not to grant it shared exclusivity for a generic version of Takeda and Lilly's big-selling diabetes drug Actos (pioglitazone).
Watson maintains that it should have been able to launch its generic today (August 17), under the terms of a settlement agreed with Takeda in 2010, but now faces a delay of six months during which time other Actos generics from Mylan and Ranbaxy will be available on the market.
At the heart of the case is the 180 days' exclusivity granted to drugmakers who are the first to file for approval of a generic in the US.
Takeda cut a deal with Watson, Mylan and Ranbaxy in 2010 which would allow them to share this exclusivity period, but Watson says it is being denied the opportunity to participate in the marketplace despite close consultation with the FDA on its marketing application.
The company alleges that it properly filed the application for its pioglitazone generic - under a process known as Paragraph IV (PIV) certification - but was advised by the FDA to convert these to a different (section VIII) filing.
A section VIII filing differs from a PIV because it 'carves out' certain indications not covered by the originator company's method-of-use patent estate, rather than covering all the approved uses of the original drug.
The strategy was used by Apotex earlier this year in a bid to gain approval of a generic version of AstraZeneca's cholesterol-lowerer Crestor (rosuvastatin), although an earlier ruling blocking its generic still stands at the moment.
Watson claims it subsequently reinstated the Paragraph IV filing after the settlement of the patent litigation with Takeda, but the change meant that the agency denied its shared exclusivity "despite the company directly following directions received from FDA".
"When we learned of FDA's position regarding our application, we made efforts to work cooperatively with FDA to resolve the situation," commented Watson's chief executive Paul Bisaro, who added: "we believe that we have sound arguments that refute FDA's position and will seek the court's intervention to enable approval."
At stake is a slice of a huge market for generic Actos, given that the brand pulled in around $2.7bn in US sales in the 12 months ending May 31.
Watson - which is in the process of acquiring fellow generics group Actavis in a €4.3bn (5.6bn) deal - said the FDA's decision would not affect its ability to meet its 2012 financial targets.