Shares of Barr Pharmaceuticals Inc. rose Friday as a Delaware federal court invalidated several patents covering Boehringer Ingelheim Pharmaceuticals Inc.'s Mirapex, opening the door for a generic launch.
Barr shares rose $1.15, or 2.7 percent, to $44.20 in afternoon trading.
In February, the generic drug maker received approval from the Food and Drug Administration to sell a generic version of Mirapex, which is used to treat restless legs syndrome, a neurological disorder characterized by sensations in the legs and an urge to move them for relief.
However, Barr has not said when it would launch Mirapex generics and says it is still evaluating options.
Boehringer Ingelheim said it plans to appeal the court's decision.
A settlement before launch is likely, according to Sanford C. Bernstein analyst Aaron Gall, as both companies would benefit. For Barr, a settlement would maximize the value of its victory and protect it in the face of a review, while for Boehringer, a deal might block a flood of generics and extend its position before an appeals court ruling.
Although Cowen's Ken Cacciatore predicted a low likelihood of a settlement, Barr can either launch immediately or wait until a ruling on an appeal. He maintained his "Outperform" rating.
JPMorgan analyst Edmund C. Kim said the next major catalyst is a ruling on a patent challenge for Sanofi-Aventis SA's Nasacort AQ allergy spray, which he expects this year and could add additional upside to the stock. He also has an "Outperform" rating.
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