ICI settles US dispute

IMPERIAL Chemical Industries is to pay dollars 21m ( pounds 14.6m) to Barr Laboratories, the US generic drugs manufacturer, as part of a settlement of a legal dispute over the US patent for Nolvadex, ICI's best-selling breast-cancer drug.

Under the agreement, Barr will be able to sell a generic version of Nolvadex in November, although ICI will supply it with the product. The terms of the distribution agreement were not disclosed, but ICI said it was 'commercially satisfactory' to both companies.

Barr alleged that ICI had failed to submit all relevant technical data on Nolvadex when it filed its patent application in the US, a claim that was upheld by the southern district court of New York last April. Although ICI appealed, it also started discussions with Barr. The settlement is contingent on the judgment being set aside - leaving the patent valid - and the case dismissed.

ICI said yesterday that both parties agreed 'there was a substantial possibility' that the patent would have been held valid and enforceable, while Barr admitted that the appeal raised genuine issues. But a spokesman for ICI said the settlement removed uncertainty.

'We felt it was better to have the certainty of an out-of-court settlement than the expense and inconvenience of litigation,' he said. Analysts say the group may also have been keen to resolve the dispute before the demerger of Zeneca, ICI's pharmaceuticals arm, in the summer.

Although Nolvadex is a relatively old drug, it has been given a new lease of life as a treatment for breast cancer. Its US sales in 1992 were dollars 265m, and its patent is not due to expire until 2002.