Amgen Threatens to Sue Roche on Mircera

Shortly after U.S. district Judge William Young said the court will appoint third-party experts to evaluate the dosing and pricing of Roche's Mircera, a potential competitor with Amgen Inc.'s anemia drugs Epogen and Aranesp, Amgen said it may sue Roche for damages in a jury trial if it goes ahead with the product launch.

A jury last fall found that Mircera infringed three Amgen anemia drug patents, but Judge Young has so far declined to issue a permanent injunction against Roche's product, saying he might consider allowing Mircera on the market in order to foster price competition.

Citi Investment Research analyst Yaron Werber said he believes Amgen's threat is aimed at preventing Roche from launching Mircera even if Young lifts the temporary injunction against Mircera, as they could be liable for substantial damages if they lose in a trial.

"While it is not clear if Roche will take this threat seriously and not launch the drug even if Young rules in their favor, it adds another layer of complexity to the trial," Werber wrote in a note to clients.

Rodman & Renshaw analyst Michael G. King, Jr. said he views the court's delay as a short-term victory for Amgen, but thinks the judge's move seems to indicate that the court is becoming increasingly interested in finding an economically fair solution for both parties rather than granting Amgen the typical permanent injunction.

In a note backing a "Market Perform" rating, King said the delay should help relieve some share pressure on Amgen. But, he warned that Judge Young's decision could have far-reaching effects in the drug sector if he rules in favor of Roche.

"We believe such a precedent would fundamentally alter the intellectual property landscape and jeopardize the exclusivity of all unexpired drug patents," he wrote.

However, Lazard Capital Markets analyst Joel Sendek doesn't think Roche will ultimately win a launch.

"In our view, the permanent injunction is still the most likely outcome given the potentially dangerous precedent a compulsory license would set," he wrote in a note to investors Thursday.

Shares of Thousand Oaks, Calif.-based Amgen slipped 33 cents to $41.67 in afternoon trading.