NEW YORK (CNNMoney.com) -- A New York judge decides today whether to honor a legal attack from Bristol-Myers and Sanofi-Aventis, which are trying to halt the generic production of their blockbuster drug Plavix.

Apotex, a privately held Canadian drugmaker, has been producing and selling a generic version of the blood thinner with approval from the FDA but without legal clearance. Bristol-Myers (up $0.12 to $21.60, Charts) and Sanofi-Aventis (down $0.06 to $45.50, Charts) filed an injunction in the U.S. District Court for the Southern District of New York to try to bring sales to a screeching halt and recall the generic drugs that have already been distributed.

Judge Sidney Stein is expected to decide on the injunction today.

Bristol-Myers and Sanofi have a lot riding on the court decision. Plavix sales totaled $3.8 billion in 2005 for Bristol-Myers, the New York-based developer of the drug, and $2.6 billion for Sanofi-Aventis, the Parisian drug giant that sells Plavix in Europe. The patent on the drug runs until 2012, but the companies will probably see drug sales erode from generic competition long before that.

Les Funtleyder, analyst for Miller Tabak, said that generic Plavix produced by one company - Apotex - could take half the drug sales from Bristol-Myers, which is serious because Plavix contributes 20 percent of sales for the American firm. And if other companies start producing generic versions, the bottom could completely fall out of the drug's price, taking big bites out of revenue and earnings, Funtleyder remarked.

In addition to the injunction to try and block generic production, Bristol-Myers spokesman Tony Plohoros said his company is offering rebates to Plavix patients to make up for the price difference between the name-brand product and the generic competitor from Apotex.

But Funtleyder said he expects the judge to not grant the injunction from Bristol-Myers and Sanofi, for two reasons: cheaper generic Plavix benefits the patients, and Bristol-Myers is tainted by a criminal investigation from federal authorities.

Bristol-Myers recently came under investigation by the Department of Justice, after the company offered Apotex a $40 million settlement to halt production of generic Plavix until 2011. This proposed settlement was shot down by state-level attorneys general, and the DOJ has launched a criminal investigation of the negotiations.

Bristol released a statement saying that all employees will cooperate with the investigation and that an internal investigation by outside counsel "has not found any evidence of unlawful conduct" by employees.

In a worst-case scenario, Funtleyder said the loss of Plavix could result in the ouster of CEO Peter Dolan, and Bristol could become a potential takeover target. Dolan has recently come under fire for the sagging performance of Bristol-Myers stock, which has plunged more than 50 percent since Dolan took the top job in 2001, compared to an S&P gain of 2 percent.

Sanofi would also feel the bite of generic competition if the injunction failed to win approval.

Gbola Amusa, analyst for Sanford C. Bernstein, said that generic competition to Plavix could cut 12 percent out of Sanofi's total earnings. But the impact on the company's stock would be muted.

"Plavix is an important issue, but the market has already assumed the worse [for Sanofi-Aventis and Bristol-Myers]," said Amusa.

Sanofi is fighting a two-front war against the threat of generic competition. Not only is Plavix getting squeezed by Apotex, but the patent for Sanofi's top earner Lovenox, another blood thinner, has been challenged by four manufacturers of generic drugs.

Two separate partnerships of drug makers - Teva Pharmaceuticals (down $0.36 to $34.27, Charts)/Amphastar and Novartis' (up $0.18 to $57.19, Charts) Sandoz division/Momenta (down $0.06 to $15.70, Charts) - have filed applications with the FDA to produce generic versions of Lovenox. The drug is essential to Sanofi's earnings and revenue, totaling $2.8 billion in 2005 sales, and the patent runs until 2012. If other companies are successful in producing in cheap, generic versions of the blood thinner, then Sanofi's sales could plunge.

Sanofi has sued the Jerusalem-based Teva, the biggest generic maker in the world, as well as its partner, the privately-held Amphastar. A spokesperson for Momenta said her company was not directly sued by Sanofi, but partner Sandoz was the subject of a suit.

Lovenox is similar to biotech drugs in its difficulty and complexity to manufacture, and there is more of an obstacle to producing biogeneric imitations that the threat of a lawsuit from Sanofi.

"We don't think the patents are going to block anybody; we think it's an issue over biologics," said Ken Cacciatore, analyst for Cowen & Co.

Analysts said that Momenta is best-suited to produce a biogeneric version of Lovenox.

"We believe that none of the companies will get approval to produce Lovenox except for Momenta," said Gbola Amusa, analyst for Sanford C. Bernstein. "The FDA will approve only that company, because only they have the technology to produce it."

The next trial date is Oct. 10, where Sanofi will face off with Teva and Amphastar in U.S. district court in California. A U.S. Court of Appeals recently shot down a lower court decision that said Sanofi's patent was invalid, and then the case was remanded to the California court. This next court date will deal with Amphastar's claim that Sanofi deliberately tried to deceive the U.S. Patent and Trademark Office, and other claims of patent infringement will be dealt with at a later time.

Amit Roy, analyst for Citigroup, estimates a 75 percent chance that Sanofi loses patent protection of Lovenox by 2007. Roy said this would cause a 6 percent cut to Sanofi's earnings per share in 2007, followed by an 10 percent hit in 2008, on top of any losses related to Plavix litigation.

Roy said that loss of Lovenox could be particularly dangerous to Sanofi's stock price, because is not that well-known to investors and could come as quite a shock.

"The Plavix loss is almost priced in," said Roy. "The potential to lose Lovenox is not priced in yet, so there's more downside risk to the stock."

These analysts interviewed for this story do not own shares in companies mentioned here.

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