Multiple Eli Lilly Pharmaceutical Patents Soon to Expire
When it comes to patented drugs, perception is reality, and perception yields big business. Eli Lilly certainly knows this. By 2010, they are expected to have earned a combined $12B for three of their "blockbuster" patented drugs: cancer battling Gemzar, antidepressant Cymbalta, and Evista for osteoporosis (Barron’s online, 19 November 2007).
Consumers pay more for patented brand name drugs, because they simply feel they work better. This may be attributed to feeling brand name drugs are more well researched, connecting to the advertising that supports such drugs, or perhaps believing the generic versions have less of the critical ingredient(s). Whatever underlies the perceptions, pharmaceutical companies continually recognize the value of patented drugs in their yearly profits.
However, a pharmaceutical company cannot monopolize the market with their patents interminably. The 20-year patent limit set by the United States Patent and Trademark Office ensures that other drug companies can participate in the market. Typically, drug companies receive their patents well before they have completed all their research and drug trials and before they are FDA approved. Acknowledging this, the USPTO offers drug companies a five year extension on their patent protection; however, the actual time a patented drug is in the market is approximately 14 years. This leaves generic drug manufacturers room to enter the market and grow their businesses.
And, as competitors bide their time, market analysts watch drug companies closely–and measure their worth by a factor of whether and when their drug patents will expire and what new patents are in the works. With several of Eli Lilly’s blockbuster drug patents set to expire in the near future and uncertainty over whether their new clot-preventing Prasugrel will be a strong rival to Bristol-Myers Suibb‘s Plavix, investor anxieties are running high. Eli Lilly remains hopeful. We’ll just have to wait and see.