Novartis accused of owing $47m in IP royalties
Novartis should pay a Daiichi Sankyo subsidiary, Plexxikon, $47 million in overdue IP royalties, according to an argument presented before a federal court in California this week.
In 2017, Plexxikon sued Novartis for infringing US patent number 9,469,640 through Novartis’s sale of the drug dabrafenib, which is marketed under the trademark Tafinlar.
On Wednesday 14 July, Plexxikon called economist Gregory Thomas, vice president of Charles Rivers Associates, to testify before the US District Court for the District of California, who asserted that Plexxikon was owed the money.
According to Plexxikon, the Japan-based unit’s scientists discovered and started making compounds that reduce the growth of cancer cells that have a mutated form of the BRAF gene in 2005.
The BRAF gene encodes information used by cells to produce enzymes that increase cellular metabolism and growth. The mutated BRAF gene substantially increases BRAF kinase activity, driving the proliferation of cancer cells.
The compounds discovered target and bind with the BRAF kinase produced by the mutated BRAF gene in a manner that inhibits its activity, and disrupts the cancer cells’ ability to metabolise energy, according to Plexxikon.
To protect its discovery, Plexxikon filed patent applications in June 2005, disclosing novel compounds having the core molecular structure that Plexxikon had invented.
Several of those applications matured into patents that cover selective BRAF kinase inhibitors, including some directed to the molecular structure of vemurafenib and one (filed in July 2007) that matured into the disputed ’640 patent.
The ’640 patent covers a class of selective BRAF kinase inhibitors. One of the molecules within this class (dabrafenib) was brought to market by Novartis’s predecessor GlaxoSmithKline (GSK).
In 2013, GSK received approval from the US Food and Drug Administration to sell dabrafenib for the treatment of melanoma and began selling it under the trademark Tafinlar. Tafinlar directly competes with Plexxikon’s Zelboraf.
GSK transferred a portfolio of oncology drugs, including Tafinlar, to Novartis in 2015 in exchange for approximately $16 billion. In June of 2017, Novartis received FDA approval to sell dabrafenib under the trademark Tafinlar for treatment of non-small cell lung cancer.
Novartis sells, imports and offers dabrafenib for sale under the trademark Tafinlar and those sales continue to erode sales of Zelboraf, complained Plexxikon.
Novartis, as successor-in-interest to GSK, knew or should have known of any copying on GSK’s part of Plexxikon’s novel structure to develop Tafinlar, according to Plexxikon.
The complaint said Novartis’s acts of infringement include, but are not limited to, selling and offering to sell the infringing product within the district to its distributor, San Francisco-based McKesson Corporation.
Novartis also employs oncology sales representatives within the district whose customers include office-based physicians, consultant pharmacists, medical directors, and key medical and nursing personnel, stated Plexxikon, which holds that the allegedly infringing product is also used by healthcare providers and patients.
Novartis has countered that the patent was invented by Tara Rheault, a medicinal chemist at GlaxoSmithKline, and that Plexxikon cannot have a valid claim that encompasses Tafinlar.
Plexxikon retorted that it is not arguing that it “invented Tafinlar”. Instead, it contends that it invented a genus of compounds, of which Tafinlar is one of the species in that genus.
“Novartis may well have done additional inventive work to develop the specific Tafinlar compound that entitles it to patents for those additional contributions. That says nothing about the validity of the earlier Plexxikon patents, which must be evaluated on their own merits,” stated Plexxikon.
