In a filing with the U.S. Securities and Exchange Commission (SEC), Abbott Laboratories Inc. (ABT) announced that it has settled its patent litigation with Teva Pharmaceutical Industries Ltd. (TEVA), which was seeking to market generic versions of Abbott’s TriCor.

According to the agreement between the companies, Teva will be allowed to launch a generic version of TriCor no sooner than March 28, 2011. However, under certain unspecified circumstances, Teva might not receive such rights until July 1, 2012. Additional details were not provided. The settlement involves the 145 mg dose of TriCor, which accounts for a major part of TriCor’s sales.

Abbott’s cardiovascular business is being driven by TriCor, a powerful triglyceride lowering agent often used in-combination with statins, and its next-generation candidate, TriLipix. Given the generic threats to TriCor, Abbott is looking to shift users to TriLipix. TriLipix was approved in December 2008 and should strengthen Abbott’s position in the fenofibrate market.

In order to protect its cardiovascular business, Abbott is currently seeking approval from the U.S. Food and Drug Administration (FDA) for Certriad, a fixed-dose, single pill formulation of TriLipix and AstraZeneca’s (AZN) powerful statin drug, Crestor. AstraZeneca is co-promoting TriLipix and will co-promote Certriad with Abbott once approved. Approval could come in the first half of 2010.

While Abbott’s settlement with Teva should help reduce concerns regarding Teva’s launching a generic version of TriCor in late 2010, we note that TriCor is still facing patent challenges from companies like Impax (IPXL).

We currently have a Neutral recommendation on Abbott. The company’s strong business segments, contributions from recent acquisitions and impressive late-stage pipeline should help fortify long-term earnings growth.

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