Schering-Plough to Challenge FTC Administrative Complaint Involving Two Patent Litigation Settlements

Apr 02, 2001, 01:00 ET from Schering-Plough Corporation

    KENILWORTH, N.J., April 2 /PRNewswire/ -- Schering-Plough Corporation
 (NYSE:   SGP) today said it would vigorously challenge an administrative
 complaint filed today by the Federal Trade Commission (FTC) against the
 company involving patent litigation settlements reached in 1997 with
 Upsher-Smith Laboratories, Inc. and in 1998 with ESI Lederle, Inc.,
 respectively, by its Key Pharmaceuticals division on the grounds the
 settlements were lawful and benefited consumers.
     The company said that the FTC's Bureau of Competition filed a complaint in
 Washington, D.C. before an FTC administrative law judge charging that the
 patent litigation settlements involving its controlled-release potassium
 chloride supplement K-DUR(R) (potassium chloride USP) were anti-competitive
 and violated the Federal Trade Commission Act.  Among the remedies sought in
 the FTC administrative complaint are for Schering-Plough to cease and desist
 from entering into certain types of patent settlements and to immediately
 license its K-DUR patent to Upsher-Smith and ESI Lederle with no compensation
 to Schering-Plough.
     "Schering-Plough believes the settlements with Upsher-Smith and ESI
 Lederle complied with the law," said Joseph C. Connors, executive vice
 president and general counsel.  "Schering-Plough intends to proceed with a
 vigorous defense of the administrative complaint."
     Both settlements relate to a patent held by Schering-Plough covering a
 novel formulation for a controlled-release dispersible potassium chloride
 tablet that it markets under the K-DUR brand name.  This formulation patent is
 set to expire in 2006.
     In 1995, Upsher-Smith and ESI Lederle filed separate Abbreviated New Drug
 Applications (ANDA) with the U.S. Food and Drug Administration (FDA) seeking
 to market generic versions of K-DUR.  Schering-Plough brought separate actions
 against both companies alleging that their products infringed
 Schering-Plough's patent.  In each case, Schering-Plough and the parties
 settled before trial, with each party compromising their respective positions
 in the lawsuits.  Under the settlements, licenses were agreed to that allowed
 Upsher-Smith to bring its product to market in September 2001 and ESI Lederle
 to bring its product to market in January 2004.  Schering-Plough also agreed
 to license at fair value other products from each of the two companies.
     The company noted that the settlements would serve to benefit consumers
 because the settlements allowed that generic competition to K-DUR would enter
 the market well before the expiration of its 2006 formulation patent.
 
     DISCLOSURE NOTICE: The information in this press release includes certain
 forward-looking statements relating to the possible remedies that will be
 sought by the FTC in its administrative action against the company, as well as
 certain of the company's defenses to that action.  The reader of this release
 should understand that the course of this litigation, its outcome and whether
 private civil litigation will be commenced are subject to substantial risks
 and uncertainties.  For further details and a discussion of these and other
 risks and uncertainties, see the company's Securities and Exchange Commission
 filings, including the company's 2000 annual report on Form 10-K.
 
     Schering-Plough is a research-based company engaged in the discovery,
 development, manufacturing and marketing of pharmaceutical products worldwide.
 
 

SOURCE Schering-Plough Corporation
    KENILWORTH, N.J., April 2 /PRNewswire/ -- Schering-Plough Corporation
 (NYSE:   SGP) today said it would vigorously challenge an administrative
 complaint filed today by the Federal Trade Commission (FTC) against the
 company involving patent litigation settlements reached in 1997 with
 Upsher-Smith Laboratories, Inc. and in 1998 with ESI Lederle, Inc.,
 respectively, by its Key Pharmaceuticals division on the grounds the
 settlements were lawful and benefited consumers.
     The company said that the FTC's Bureau of Competition filed a complaint in
 Washington, D.C. before an FTC administrative law judge charging that the
 patent litigation settlements involving its controlled-release potassium
 chloride supplement K-DUR(R) (potassium chloride USP) were anti-competitive
 and violated the Federal Trade Commission Act.  Among the remedies sought in
 the FTC administrative complaint are for Schering-Plough to cease and desist
 from entering into certain types of patent settlements and to immediately
 license its K-DUR patent to Upsher-Smith and ESI Lederle with no compensation
 to Schering-Plough.
     "Schering-Plough believes the settlements with Upsher-Smith and ESI
 Lederle complied with the law," said Joseph C. Connors, executive vice
 president and general counsel.  "Schering-Plough intends to proceed with a
 vigorous defense of the administrative complaint."
     Both settlements relate to a patent held by Schering-Plough covering a
 novel formulation for a controlled-release dispersible potassium chloride
 tablet that it markets under the K-DUR brand name.  This formulation patent is
 set to expire in 2006.
     In 1995, Upsher-Smith and ESI Lederle filed separate Abbreviated New Drug
 Applications (ANDA) with the U.S. Food and Drug Administration (FDA) seeking
 to market generic versions of K-DUR.  Schering-Plough brought separate actions
 against both companies alleging that their products infringed
 Schering-Plough's patent.  In each case, Schering-Plough and the parties
 settled before trial, with each party compromising their respective positions
 in the lawsuits.  Under the settlements, licenses were agreed to that allowed
 Upsher-Smith to bring its product to market in September 2001 and ESI Lederle
 to bring its product to market in January 2004.  Schering-Plough also agreed
 to license at fair value other products from each of the two companies.
     The company noted that the settlements would serve to benefit consumers
 because the settlements allowed that generic competition to K-DUR would enter
 the market well before the expiration of its 2006 formulation patent.
 
     DISCLOSURE NOTICE: The information in this press release includes certain
 forward-looking statements relating to the possible remedies that will be
 sought by the FTC in its administrative action against the company, as well as
 certain of the company's defenses to that action.  The reader of this release
 should understand that the course of this litigation, its outcome and whether
 private civil litigation will be commenced are subject to substantial risks
 and uncertainties.  For further details and a discussion of these and other
 risks and uncertainties, see the company's Securities and Exchange Commission
 filings, including the company's 2000 annual report on Form 10-K.
 
     Schering-Plough is a research-based company engaged in the discovery,
 development, manufacturing and marketing of pharmaceutical products worldwide.
 
 SOURCE  Schering-Plough Corporation

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