Ruling of a federal appeals court has barred Actavis from removing its most popular drug for Alzheimer's disease drug from the market. The company's move was intended to bolster its coffer by forcing patients to switch to a more expensive extended-release version.

New York's attorney general, Eric T. Schneiderman, sued the company for attempting to kill competition from generic drug makers. The ruling by the United States Circuit Court of Appeals for the Second Circuit brought victory for Schneiderman.

An order in December by Judge Robert W. Sweet of Federal District Court Q was upheld by a three-judge panel to prohibit Actavis from withdrawing the drug from the market.

The lawsuit against Actavis came from Schneiderman last year, after learning that the company is determined to discontinue Namenda IR to clear the way for Namenda XR. The same active ingredient, memantine, is present in both the drugs; the only difference is that patients need to take Namenda XR once instead of twice.

Actavis fears loss of $200 million in sales if ruled to withdraw Namenda IR. However, the court said, "By removing Namenda IR from the market prior to generic IR entry, defendants sought to deprive consumers of that choice".

Laws in about 30 US states require pharmacists to substitute a generic drug for a brand-name drug whenever an exact equivalent is available.

Michael Carrier, a Rutgers University law professor, said the court's ruling is a real aggressive move to force the company to keep Namenda IR in the market.