Broker snap: Pfizer case to be positive for UK pharma stocks, says Matrix

16th Aug 2011 13:01

Matrix has highlighted the effect that the patent infringement case won by US pharmaceutical group Pfizer will have on its London-listed peers, GlaxoSmithKline, AstraZeneca and Shire."Yesterday, Pfizer announced it had prevailed in its patent infringement action against generics company Teva Pharmaceuticals to protect a ?method-of-use? patent for one of its blockbuster drugs, Viagra," Matrix notes.US District Judge Rebecca Smith said that there is "utterly no evidence" that Pfizer intentionally withheld material information from the patent office. "Protecting the drug has important financial implications for Pfizer. For the industry, the importance is many-fold higher," said Matrix analysts Navid Malik and Deirdre O'Brien."This is a positive precedent for other existing method of use patents as well as future method of use patents, providing an addition hurdle for generics, thereby justifying a re-rating in the pharmaceutical sector given the heavy reliance on such patents."The broker thinks that this will be positive for pharma stocks GlaxoSmithKline (buy with target price of 1,418p), AstraZeneca (reduce with target price of 2,806p) and Shire (buy with target of 1,951p).BC