Celgene settles Revlimid patent litigation

Shares of US biotech major Celgene (Nasdaq: CELG) rose 9% to $121.03 in after-hours trading on Tuesday, after it reported a patent settlement – or pay-for-delay deal - for its best-selling drug Revlimid (lenalidomide).

Celgene announced the settlement of litigation with India’s Natco Pharma and Natco’s US partner, Arrow International Ltd, and Arrow’s parent company, Watson Laboratories (a wholly-owned subsidiary of Allergan [NYSE: ACT]), relating to patents for Revlimid, a multiple myeloma treatment, sales of which the company recently said will hit around $5.8 billion for the full-year 2015.

As part of the settlement, the parties will file Consent Judgments with the US District Court for the District of New Jersey that enjoin Natco from marketing generic lenalidomide before the expiration of the patents-in-suit, except as provided for in the settlement, as described below.