The courtroom has been a popular destination for Teva Pharmaceuticals (NASDAQ:TEVA) lately, and it looks like the company is about to spend even more time in court. Teva recently launched its generic version of Wyeth's (NYSE:WYE) and Altana's heartburn medication, Protonix, and there are high stakes on either side of the dispute.

Sales of Protonix in the first nine months of 2007 totaled approximately $1.4 billion -- that's 8% of total revenue for Wyeth. The launch also has potential to be a boon for Teva. As one of the first companies to file an Abbreviated New Drug Application with the FDA, Teva is entitled to six months of marketing exclusivity before other generics can come on the market.

The FDA approved Teva's knockoff version of the drug in August. In September, Wyeth and Altana tried to get a preliminary injunction, but the court found that there wasn't enough evidence to stop the launch. As it was a preliminary ruling, the court fell short of calling the patent invalid (Wyeth believes the patent doesn't expire until 2010), so the trio could be back in court next year.

The companies entered into settlement discussions after the launch, and Teva agreed not to ship any additional product for 30 days. Teva is risking a lot by launching now, before the patent has been invalidated; if the courts rule in Wyeth's favor, Teva could have to pay the patent holders triple damages for sales of the drug.

My guess is that Teva is looking to settle the case, and the launch was just to get the talks going. The company might be trying to reach an agreement in which it launches one of the doses now, but agrees to wait on other doses, like it did in its agreement with Biovail (NYSE:BVF) and GlaxoSmithKline (NYSE:GSK) over their antidepressant Wellbutrin XL.

I don't think Teva has veered off course, but only time will tell if it can keep a strong stomach through negotiations.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Glaxo is a selection of the Income Investor newsletter. The Fool has a disclosure policy.