AstraZeneca Makes Deal With Teva On Generics

British drug maker reached an agreement with Teva Pharmaceutical Industries Ltd. that will keep generic copies of heartburn drug Nexium out of U.S. market until 2014.

LONDON (AP) -- AstraZeneca PLC said Thursday it had reached an agreement with Teva Pharmaceutical Industries Ltd. that will keep generic copies of the British drug maker's heartburn drug Nexium out of the U.S. market until 2014.

The deal, which ends a long-running dispute between the two companies, reduces the likely impact of sales from competitive generic drugs on AstraZeneca's revenue from 2011. It also averts a court case that was due to begin this month.

Under the deal, AstraZeneca has granted Teva a license to enter the U.S. market on May 27, 2014, subject to regulatory approval.

Teva has conceded that all patents-at-issue in U.S. litigations are "valid and enforceable." It also conceded that six Nexium patents would be infringed by the manufacture or sale of Teva's U.S. generic esomeprazole.

The pair also settled patent litigation over AstraZeneca's gastrointestinal drug Prilosec, also known as omeprazole, with Teva agreeing to make a one-time payment to AstraZeneca relating to past sales. AstraZeneca did not release financial terms. Teva will continue to market omeprazole in the United States.

AstraZeneca is under increasing pressure to fill out its thin pipeline of future drugs as generic competition increases, particularly in the United States where it does the bulk of its business.

Its shares were up 1 percent at 2,905 pence in midmorning trade on the London Stock Exchange.

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