Dr Reddy's Labs found some support in a rather subdued market on news that it is seeking valediction from US courts over an ANDA against multinational Pfizer.

The scrip of the Indian pharmaceuticals major inched up by 0.29% to Rs 879 in early afternoon trades. The scrip however came off the day's high of Rs 884.90. The scrip may have been better poised, marketmen say, if not for the general weakness permeated by international political developments.

On Monday, US markets tumbled as the US and allies pressed for a second UN resolution on Iraq, that implied action against the renegade West Asian nation. Also, the test firing of a missile by North Korea prompted Asian markets to slump in morning trades. This was bound to be reflected on the 30-share BSE Sensex as well, as it floundered 36 points to 3,286 by early afternoon trades.

But DRL was steady after the company announced on Monday that it has filed a lawsuit seeking declaratory judgement against Pfizer in the United States District Court for the District of New Jersey regarding its Abbreviated New Drug Application for Sertraline HCL. The lawsuit seeks a declaratory judgement that the claims of certain Pfizer patents are invalid and/or not infringed. Dealers, however, say the development was not of much consequence, as it could not be gauged how long it would take for the judgement to materialise.

Dr Reddy's Laboratories has been vacillating considerably in the last few weeks after rallying sharply from a low of Rs 687.75 on 25 October 2002 .

On Monday, DRL said it has filed a lawsuit seeking declaratory judgement against Pfizer regarding its ANDA for Sertraline HCl. DRL had filed an ANDA with the US Food and Drug Administration for Sertraline HCL tablets, equivalent to 25, 50 and 100 mg base, with a Paragraph IV certification on four of the five patents listed on the Orange Book. The company notified Pfizer of the filing. Pfizer did not file a lawsuit against the company within the 45-day period prescribed by the Hatch-Waxman Act.

Sertraline HCL is the generic version of Pfizer's Zoloft(R). It is indicated for use in the treatment of major depressive disorders, obsessive-compulsive disorders, panic disorders, post-traumatic stress disorders and premenstrual dysphoric disorder. The product had US brand sales of $2.4 billion in the year 2002.

In another development, DRL, on Monday, signed a 15-year exclusive product development and marketing agreement with US based Leniner Health Products which is exclusively for DRL's over-the-counter drug products. The agreement includes exclusive marketing partnership for DRL's OTC products.

There were rumours recently that a molecule from DRL's stable in clinical trials had failed. The market has not so far got wind of which one of the five molecules of the company currently in process had failed. As of now, the molecules by the company are DRF 8417, DRF 2593, DRF 4832, DRF1042 and DRF 1644. Of which, DRF 2593 is in the phase II clinical trial, while the others are in pre-clinical and phase I clinical trials.

DRL has been beset by negative developments of late. One of these was that the company dropped three new compounds (DRF 4848, DRF 3188 and DRF NPPC) from its research pipeline. The same were undergoing/ completed pre-clinical development or animal trials. However, the company did not provide any reasons for this move.

In early February 2003, Novo Nordisk said it had decided not to pursue further development of DRL's insulin sensitizer Ragaglitazar (DRF2725; NN622). The decision was taken after Novo performed a renewed benefit/risk assessment of the compound, including analysis of both the clinical phase III data and the tumour findings in the long-term animal studies. The financial terms and conditions of the original agreement remain unchanged, DRL said in a statement.

This compound was out-licensed by DRL to Novo Nordisk in August 1998. Ragaglitazar (DRF 2725; NN622) is an insulin sensitizer that acts as a dual PPAR (peroxisome proliferator-activated receptor) alpha and gamma agonist. In July 2002, Novo Nordisk had announced that it was suspending phase 3 clinical trials of Ragaglitazar (DRF 2725; NN622) after it found tumors in one mouse and several rats in long-term animal studies.

On the other hand, Novo had completed analysis of phase II data on DRL's other insulin sensitiser Balaglitazone (DRF 2593; NN 2344). Based on the good clinical efficacy and safety profile obtained in these studies, Novo Nordisk decided to continue the development of Balaglitazone. This compound was out-licensed by Dr Reddy's to Novo Nordisk in March 1997.

BSE code: 500124

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