Commitments and contingencies

6 Months Ended

Jun. 30, 2013

Commitments and contingencies

Note 17. Commitments and contingencies:

Litigation

From time to time, we are subject to claims and litigation arising in the ordinary course of business. These claims may include assertions that our products infringe existing patents and claims that the use of our products has caused personal injuries. We intend to vigorously defend any such litigation that may arise under all defenses that would be available to us.

Zoledronic Acid (Generic versions of Zometa^® and Reclast^®).

On February 20, 2013, Novartis Pharmaceuticals Corporation (“Novartis”) sued the Company and several other defendants in the United States District Court for the District of New Jersey, alleging, among other things, that sales of the Company’s (i) zoledronic acid premix bag (4mg/100ml) supplied to the Company by ACS Dobfar Info S.A. (“Info”), a generic version of Novartis’ Zometa^® ready to use bottle would infringe U.S. Patent No. 7,932,241 (the “241 Patent”) and U.S. Patent No. 8,324,189 (the “189 Patent”); (ii) zoledronic acid premix bag (5mg/100ml) also supplied ot us by Info, a generic version of Novartis’ Reclast^® ready to use bottle would infringe U.S. Patent No. 8,052,987 and the 241 Patent (Novartis Pharmaceuticals Corporation v. Actavis, LLC, et. al., Case No. 13-cv-1028), and (iii) zoledronc acid vial (4mg/5ml), a generic version of Novartis’ Zometa^® vial supplied to the Company by Actavis, would infringe the 189 Patent. On March 1, 2013, the District Court denied Novartis’ request for a temporary restraining order against the Company and the other defendants, including Actavis and Info. On March 6, 2013, the Company began selling Actavis’ zoledronic acid vial, the generic version of Zometa^®. The Company believes it has substantial meritorious defenses to the case. The Company has sold and is continuing to sell Actavis’ zoledronic acid vial, and intends to sell Info’s zoledronic acid premix bag versions of Zometa^® and Reclast^® upon FDA approval of those products. Therefore, a final determination that one of the patents is valid and infringed could have an adverse effect on the Company’s business, results of operations, financial condition and cash flows.