(Adds background on Combigan, stock price)
NEW YORK, Dec 22 (Reuters) - Allergan Inc said on Friday that it had lost its appeal in a patent battle with Novartis AG over its Sandoz division's rival version of Allergan's Combigan eye drug and said it would file a petition to for a rehearing of the case.
Allergan said the U.S. Court of Appeals for the Federal Circuit affirmed the U.S. District Court for the Eastern District of Texas' earlier decision that the Sandoz rival did not infringe two of Allergan's patents and reversed a decision on a third patent in favor of Novartis.
It said it plans to file for rehearing within 30 days and does not expect the court to lift its injunction preventing final approval and launch of Sandoz's generic version of the drug.
There is also ongoing litigation between Allergan and Sandoz in New Jersey over a different patent for Combigan, which Allergan believes should also prevent Sandoz from launching its own version of Combigan.
Last year, Allergan sold more than $545 million of glaucoma drugs Combigan and Alphagan, which are based on the same chemical, brimonidine. Combigan also contains a second glaucoma treatment, timolol.
Sandoz already sells a generic version of Alphagan.
Shares of Allergan fell 1.7 percent to $164.82 in late trading on Friday. (Reporting by Caroline Humer and Michael Erman; Editing by Cynthia Osterman)