D.C.’s Vanda Pharmaceuticals Inc. (NASDAQ: VNDA) has settled a patent infringement lawsuit with a generic competitor over the local company’s key product.
Vanda said Friday it has inked a license deal that puts to bed litigation against Piscataway, New Jersey’s MSN Pharmaceuticals Inc. and MSN Laboratories Private Ltd., which wanted to make a generic version of Hetlioz, Vanda’s treatment for non-24-hour sleep-wake disorder.
The agreement gives a nonexclusive license to MSN and Impax Laboratories LLC of Hayward, Connecticut (part of Bridgewater, New Jersey’s Amneal Pharmaceuticals LLC), to make and commercialize a product using tasimelteon — the active ingredient in Hetlioz — starting March 13, 2035.
That date would push back to late July 2035 if Vanda earns a pediatric exclusivity for Hetlioz, according to the company. And MSN and Impax “may be able to enter the market earlier under certain circumstances,” such as in the case of another third-party entering the market with a generic version of Hetlioz, according to filings with the Securities and Exchange Commission.
The local biotech said in those filings that if it enters into any similar agreements for others to market generic versions of Hetlioz earlier, “MSN and Impax will receive the benefit of such earlier date.”
Vanda filed that complaint Feb. 24, 2021, in Delaware District Court alleging that MSN’s application to market a generic version of Hetlioz in the U.S. violated Vanda’s patents that cover the product. The settlement includes Impax because of a confidential contractual relationship it has with MSN that required it be included in the license, according to Vanda.
Now the Federal Trade Commission and Department of Justice will review the agreement, which “provides for a full settlement and release by Vanda, MSN and Impax of all claims that are the subject of the litigation,” Vanda said in its announcement. Vanda’s stock was down 4.6% to $14.31 per share early afternoon Tuesday.
Hetlioz history
The outcome of the generic litigation is a big deal for Vanda, as a significant portion of its revenue comes from Hetlioz. The company reported year-over-year revenue growth in the third quarter of 2021, with net product revenue from Hetlioz experiencing a 15% boost compared to the third quarter of 2020. And Vanda saw $70.1 million in total revenue, which comes from Hetlioz and schizophrenia drug Fanapt, representing a 16% increase over the third quarter of 2020, the company reported in November.
Vanda first earned approval from the Food and Drug Administration in 2014 to market Hetlioz as a treatment for non-24-hour sleep-wake disorder. Then in December 2020, the FDA approved Hetlioz as a treatment for nighttime sleep disturbances in Smith-Magenis Syndrome (SMS) a rare developmental disorder with no other available treatment that causes intellectual disability, delayed speech, sleep disturbances and behavioral problems.
As of November, more than 90 patients with SMS had been prescribed Hetlioz, Dr. Mihael Polymeropoulos, president and CEO of Vanda, said on the company's third-quarter earnings call. “We plan to extend our awareness campaign with a goal of creating awareness among the community of approximately 15,000 SMS patients in the U.S.,” he said, adding that “the clinical profile of Hetlioz and the degree of unmet medical need for patients with SMS provides a substantial growth opportunity in the future.”
Other clinical programs
Vanda is separately advancing multiple clinical programs, including for drug candidate tradipitant in a chronic gastrointestinal disease called gastroparesis. A phase 3 study is now moving forward, positioning the company to discuss a new drug application with regulators once it completes.
“Given this estimated prevalence, upon successful completion of the program, we see a significant commercial opportunity in creating awareness for both the condition and for tradipitant as a new pharmacological option for patients with gastroparesis,” Polymeropoulos said on the third-quarter earnings call.
The company is also advancing clinical programs for sleep phase disorder, and in insomnia in autism spectrum disorder. That’s in addition to studying tradipitant in motion sickness, and advancing programs involving Fanapt in bipolar disorder and Parkinson’s disease psychosis.
