Genentech seeks ‘tens of millions in unpaid royalties’ in licence dispute
The Roche subsidiary says the licensee owes payments on “stockpile” of MS drug Tysabri.
Genentech is seeking “tens of millions of unpaid royalties” from Massachusetts-based Biogen over the sale of Tysabri, a treatment for multiple sclerosis and Crohn’s disease.
The Roche subsidiary says that Biogen breached the contract of its patent license by halting payments on net sales of Tysabri (natalizumab) after the patent expired, even though the product was manufactured before that date. It is suing Biogen in the Northern District of California district court in a lawsuit filed last week (February 28).
The patent family at the heart of the dispute, known as Cabilly, is widely licensed in the biotech industry and includes US patent nos. 6,331,415 and 7,923,221. Named after scientist Shmuel Cabilly, it covers a method of manufacturing antibodies, and was used by Biogen to manufacture natalizumab, the active ingredient in its blockbuster drug.
Biogen had a written agreement with Genentech dating back to 2004 which gave it non-exclusive rights to use Cabilly, and Tysabri was approved by the US Food and Drug Administration (FDA) the same year. Under the agreement, Biogen was required to pay Genentech a small percentage royalty on net sales of Tysabri.
However, Genentech alleges that in March 2019, Biogen stopped making the payments, after assuming the position that it no longer owed royalties on Tysabri sold after Cabrilly expired in December 2018 “even if antibodies that comprised its active ingredient were manufactured before that date using a patented method”.
‘Stockpile’
Genentech believes that owing to the complex process of manufacturing antibodies and risk of running out of product, Biogen would have amassed a stockpile of Tysabri of potentially “several calendar quarters worth of product”.
“Therefore, on information and belief, most or all of the natalizumab in the Tysabri that Biogen sold in 2019 and beyond was made in or imported into the United States prior to the expiration of Cabilly, and therefore is ‘licensed product’,” Genentech alleges in the lawsuit. This would amount to tens of millions of dollars, the firm says.
A Genentech spokesperson told Reuters that the company was “confident in the enforceability” of the patents. A Biogen spokesperson declined to comment.
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