If you thought patent settlements were just boring legal paperwork, think again. Takeda Pharmaceutical Company Limited (Takeda (TAK)) just got hit with a nearly $885 million jury verdict in a case that centers on a 2014 agreement over its constipation drug Amitiza (lubiprostone). And that number could get a lot bigger.
The lawsuit, brought by a group of wholesalers, retailers, and end payors, alleged that Takeda, along with Sucampo Pharmaceuticals and Par Pharmaceutical, struck a deal that illegally delayed generic competition for Amitiza. The jury agreed, awarding $884.9 million in single damages. That breaks down to about $474.9 million for the wholesaler class and roughly $346.8 million for individual retailers.
Here's where it gets spicy: Under U.S. antitrust law, those amounts will automatically triple once the judgment is entered. So the wholesaler and retailer portions alone could balloon to over $2.4 billion. Damages for the end payor class are still being sorted out in additional proceedings.
Takeda, unsurprisingly, sees things differently. The company argues that the 2014 settlement was the result of arm's-length negotiations and complied with the Hatch-Waxman framework, which governs pharmaceutical patent disputes. According to Takeda, the deal allowed Par Pharmaceutical to launch an authorized generic version of Amitiza on January 1, 2021—more than six years before the drug's patents were set to expire and 17 months before Par's own generic application got approved.
"We remain firm in our conviction that the plaintiffs' case lacks merit, and we will vigorously pursue post-trial motions and an appeal," Takeda said in a statement.
For context, Takeda no longer markets or sells Amitiza. It terminated its collaboration and license agreement with Sucampo on March 31, 2024. Other generic competitors have also entered the market under separate licensed entry dates.
As for Takeda's stock, shares were up 0.33% at $16.62 on Tuesday. Over the past month, TAK has declined about 6.9%, while the S&P 500 rose 4.0%. Year-to-date, Takeda is up roughly 5%, compared to the S&P 500's 7.5% gain.
So, is this the end of the road? Not even close. With post-trial motions and an appeal ahead, this case has a long way to go. But for now, it's a stark reminder that patent settlement deals can come with massive antitrust risks.
