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Bristol-Myers Squibb Company has lost an unusual breach of contract case against Matrix Laboratories Ltd., a generic drug company that distributes a low-cost generic version of BMS' HIV/AIDS drug Reyataz in 49 poor and developing countries. In a 20-page decision issued Monday, Bristol-Myers Squibb v. Matrix Laboratories, 12 Civ. 5846, Southern District Judge Paul Engelmayer (See Profile) dismissed BMS' claim that Matrix, a subsidiary of Mylan Laboratories Ltd., violated a litigation amnesty agreement between the companies by selling Reyataz to the Pan American Health Organization, which in turn distributed the medicine to AIDS patients in Venezuela. Engelmayer ruled that BMS' proper recourse is to sue Matrix for patent infringement, not breach of contract.

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