What happened
Shares of Bausch Health (BHC 0.53%) were up more than 27% late Wednesday afternoon because the company announced it had received a favorable court ruling affecting one of its leading therapies. The stock is up more than 19% so far this year.
So what
The healthcare company announced that the U.S. District Court of Delaware had ruled in its favor in a lawsuit by Bausch wholly owned subsidiary Salix Pharmaceuticals against Norwich Pharmaceuticals. Norwich was asking the court to modify its judgment that prevents the Food and Drug Administration (FDA) from approving an Abbreviated New Drug Application (ANDA) for a Norwich generic version of Xifaxan (rifaximin) until October 2, 2029.
Xifaxan is a treatment for irritable bowel syndrome. The ruling means that Bausch will likely not face generic competition for the therapy for at least six more years.
"It is our long-standing position that the Xifaxan patent claims are valid and infringed by Norwich's ANDA," Bausch CEO Thomas J. Appio said in the company's release. "We will continue to advocate for the safety of patients who have benefited from the continued access to Xifaxan, and we look ahead to the appeal process."
Now what
In its first-quarter earnings, released May 4, the company reported revenue of $1.94 billion, up 1% year over year. It reported a net loss of $201 million, compared to a loss of $69 million in the same period last year.
Xifaxan was the big gainer among the company's products, with its revenue up 7% over the same period last year. This shows that the ability to retain the drug's patent for another six years is a big deal for the company.
Bausch said it expects to bring in between $8.35 billion and $8.55 billion in revenue this year, a rise of 2.8% to 5% over 2022.
The company operates in five segments. Its Salix segment brought in $496 million in revenue in the first quarter. The company said Xifaxan was responsible for 80% of that revenue.
