The government is likely to reap a huge windfall in taxes this autumn, depending on the level of the judgement against pharmaceutical giant, Pfizer, which could be made by the Supreme Court in another few weeks.

According to figures made available to the Jamaica Observer, the government’s tax revenues could be boosted by as much as US$60 million or $7 billion, if the court awards the maximum US$311 million which local distributors, Lasco Distributors Ltd, is seeking from the judgement for being kept out of the market, between 2005 and 2012, by an injunction granted to Pfizer by the local Supreme Court in 2005.

That figure increases to US$490.1 million, after US$179.1 million in interest is added.

Of that amount, Lasco would be expected to pay the government US$60 million in taxes, leaving the company with net proceeds of $430 million, from which shareholders are also to benefit.

No figure was available from Medimpex sources, but with that company seeking US$11.5 million, that could add another US$2 million to the tax figure bringing the total payment to US$62 million or $7.25 billion.

Supreme Court Justice Viviene Harris, who heard closing submissions from Lasco and Medimpex Jamaica, as well as Pfizer, in April, is expected to make her judgement by September, but had indicated that, if it is possible, she would make it sooner.

With there being no question about whether the Supreme Court will make a judgement in favour of Lasco and Medimpex, the question now is simply how much will she award the local firms.

Pfizer, in its response to the local companies’ claims, had said that Lasco would be due no more than US$518,000 and Medimpex due US$468,000.

But, there is a lot of confidence in the local camps that the award will be a hefty one for the Jamaicans, in light of the damage done to the sale of Lasco’s Las Amlodipine and Medimpex Jamaica’s Normodyne during the injunction.

On July 2, 2014, the Judicial Committee of the Privy Council in London ruled that Lasco did not infringe the Pfizer Limited patent, as Pfizer had contended when it successfully argued in the local Supreme Court for a 10-year injunction against Lasco and Medimpex.

The injunction lasted for seven years, while the court explored its case that the local firms had infringed its patent on an active ingredient Amlodipine besylate, by using it as the base for their generic drugs for the treatment of abnormal blood pressure (hypertension).

Pfizer had been operating in Jamaica selling the hypertension drug Norvasc with Amlodipine besylate when, in 2002, Lasco Distributors entered the same market with their generic product Las Amlodipine which has the same active ingredient and is used to treat the same condition.

The drug marketed by Lasco was significantly cheaper than Pfizer’s Norvasc and was making huge inroads into a market which had been monopolised up to then by Pfizer.

At the height of the competition Lasco’s Las Amlodipine was selling at an average $5.20 per tablet compared to Norvasc’s $77.17.

Lasco’s Chairman Lascelles Chin has contended that his company lost out on 500 per cent of possible growth since the injunction due to the ban on its sales.

Chin told the court that his company’s approach had always been to sell their products at significantly lower prices than Pfizer, for the first three years of the competition, “so as to get a firm foothold in the market”.

“Thereafter,” Chin contended, “Lasco intended to use a price which, on average, would be in the range of ten per cent to 20 per cent of Pfizer’s price.”

“Such a price would be extraordinarily competitive and, importantly, very stable for many years. These conditions, coupled with others, were expected to result in rapid market penetration over a very short period of years,” he added.

Professor Rainford Wilks, a leading researcher and practitioner in the field as well as an expert witness for Lasco, noted that approximately 40 per cent of Jamaicans 15 years and older had hypertension, as defined by international guidelines.

Wilks showed that this translated to some 700,000 to 900,000 Jamaicans who were consistently in need of the drugs, between 2005 and 2014, when the court battle lasted.

He also noted that the majority of Jamaicans were in the low socio-economic classes, which constitute the largest proportion of people with hypertension.

He noted that during the period less than 40 per cent of people with hypertension were receiving treatment and that people with low socio-economic status (SES), despite being the largest group affected, were the smallest proportion of those being treated.

According to Lasco, that was evidence of the size of the potential market for its product which, with a sufficiently low-priced product, could have ultimately reached nearly the entire potential market.

Lasco said that even when the injunction was lifted in 2012, after Pfizer lost the first case in the Supreme Court, the conditions had changed significantly, as other organisations had entered the market at prices significantly lower than Pfizer’s price.

In addition, Lasco said that, at this time, it would have become a new entrant to “a much more difficult market”, and that it would have taken a long time and much more effort to make any significant impact on market share.

A condition of the injunction was that, should Lasco Distributors appeal and win, Pfizer would have to pay financial compensation to Lasco to reflect the company’s losses suffered due to the removal of their product from the market.

Pfizer lost its case in the local Supreme Court and Appeal Court and appealed to the UK Privy Council where it lost again. However, the Privy Council left the determination of the amount owed by Pfizer to the two local firms to the local Supreme Court, which has been trying to determine the figure since 2015.