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a foray into patent law
Jan. 15th, 2007 10:37 amAdmittedly, not my strong suit. However, some recent developments in MedImmune v. Genentech have piqued my interest. I've read up a little on bioportfolio.com and I think I've a handle on the story thus far:
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MedImmune uses a particular manufacturing process in production of its top-selling drug, Synagis. In order to do so, they have acquired a licensing agreement with a company called Celltech that holds a patent on said process. Celltech's patent expired in 2006, meaning MedImmune no longer needs to pay royalties on its #1 product. Hooray for MedImmune, or so one would think if one were naive and logical and not a lawyer.
In the background of all this, Celltech has been in dispute with another company called Genentech. Both companies held patents on basic manufacturing processes necessary for the production of drugs such as Synagis. Ultimately, Celltech's patent was revoked and Genentech's was nearing its expiration. In order to maintain IP and royalties, the two companies entered into a cross-licensing agreement in which Genentech filed a new patent application incorporating several claims included in Celltech's (now-revoked) patent. As a result, Genentech is now demanding royalties from MedImmune on the basis of the new cross-licensed patent through 2018.
MedImmune has counter-sued, alleging antitrust violations by Genentech and Celltech and challenging the validity of the new patent. They claim that the patent essentially provides 29 years of protection for the same technology, based on the incorporation of the claims from Celltech's old patent. However, MedImmune has made payments to Genentech even as it filed suit in federal court. This provided an interesting twist to the story, as the case was initially thrown out of lower court because MedImmune had already paid royalties. The judge ruled that there was no breach of contract and therefore no grounds for protest.
Last week, the US Supreme Court reversed the decision of the lower court saying that "The rule that a plaintiff must destroy a large building, bet the farm, or (as here) risk treble damages ... before seeking a declaration of its actively contested legal rights finds no support," (Justice Antonin Scalia for the majority opinion). MedImmune is now free to pursue its dispute of the Genentech patent claims.
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I never ever thought I would be in agreement with Antonin Scalia. Ever. On anything. Granted, I do not hold a legal degree but it seems irrational to say that MedImmune's suit is invalid because simply because it has been paying royalties.
Whether they'll get any traction in their suit against the patent claims remains to be seen, but it will be an interesting story to follow inasmuch as it may open the door for other challenges. The IP landscape in biotech is littered with patents whose claims are so vague as to be scientifically meaningless, held by companies with the deepest pockets instead of the brightest innovators. Perhaps this is the default scenario for patent law, but it seems to me there should be a balance between conditions favoring the company and those favoring innovation. Hopefully this will start the pendulum swinging.
(cross-posted to science-tech/reviewy shadowblog)
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MedImmune uses a particular manufacturing process in production of its top-selling drug, Synagis. In order to do so, they have acquired a licensing agreement with a company called Celltech that holds a patent on said process. Celltech's patent expired in 2006, meaning MedImmune no longer needs to pay royalties on its #1 product. Hooray for MedImmune, or so one would think if one were naive and logical and not a lawyer.
In the background of all this, Celltech has been in dispute with another company called Genentech. Both companies held patents on basic manufacturing processes necessary for the production of drugs such as Synagis. Ultimately, Celltech's patent was revoked and Genentech's was nearing its expiration. In order to maintain IP and royalties, the two companies entered into a cross-licensing agreement in which Genentech filed a new patent application incorporating several claims included in Celltech's (now-revoked) patent. As a result, Genentech is now demanding royalties from MedImmune on the basis of the new cross-licensed patent through 2018.
MedImmune has counter-sued, alleging antitrust violations by Genentech and Celltech and challenging the validity of the new patent. They claim that the patent essentially provides 29 years of protection for the same technology, based on the incorporation of the claims from Celltech's old patent. However, MedImmune has made payments to Genentech even as it filed suit in federal court. This provided an interesting twist to the story, as the case was initially thrown out of lower court because MedImmune had already paid royalties. The judge ruled that there was no breach of contract and therefore no grounds for protest.
Last week, the US Supreme Court reversed the decision of the lower court saying that "The rule that a plaintiff must destroy a large building, bet the farm, or (as here) risk treble damages ... before seeking a declaration of its actively contested legal rights finds no support," (Justice Antonin Scalia for the majority opinion). MedImmune is now free to pursue its dispute of the Genentech patent claims.
****
I never ever thought I would be in agreement with Antonin Scalia. Ever. On anything. Granted, I do not hold a legal degree but it seems irrational to say that MedImmune's suit is invalid because simply because it has been paying royalties.
Whether they'll get any traction in their suit against the patent claims remains to be seen, but it will be an interesting story to follow inasmuch as it may open the door for other challenges. The IP landscape in biotech is littered with patents whose claims are so vague as to be scientifically meaningless, held by companies with the deepest pockets instead of the brightest innovators. Perhaps this is the default scenario for patent law, but it seems to me there should be a balance between conditions favoring the company and those favoring innovation. Hopefully this will start the pendulum swinging.
(cross-posted to science-tech/reviewy shadowblog)
