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Merck Gilead Patent Trial 3/8/16
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Mar 9, 2016 | Wall Street Journal
By Pete Loftus
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Pharmalot, Pharmalittle: Gilead and Merck battle over hepatitis C patents
Mar 8, 2016 | STAT
By Ed Silverman
Good morning, everyone, and how are you today? A warm, shiny sun is enveloping the Pharmalot campus, where both short people and the official mascots are sleeping in. As for us, no such luck. We are as busy as ever foraging for interesting items and keeping up with our expanding to-do list. No doubt, you can relate. So time to get cracking. Here is the usual menu of tidbits to get your started. Have a smashing day and do drop us a line if you run across anything fascinating … -
Merck, Gilead wrestle in court over $3B-plus in hep C royalties
Mar 8, 2016 | FiercePharma
By Tracy Staton
Merck & Co. isn't just battling Gilead Sciences for market share with its brand-new hepatitis C drug. It's also fighting in court for a multibillion-dollar piece of Gilead's blockbuster franchise. -
Rivalry Between Gilead & Merck Heats Up
Mar 8, 2016 | Bidness
By Hadia Taqi
Gilead Sciences, Inc. (NASDAQ:GILD) is facing a double threat from Merck & Co., Inc. (NYSE:MRK) in hepatitis C market. Earlier this year, the latter scored regulatory approval for its once-daily single-tablet HCV combo pill called Zepatier, which is expected to restrict Gilead’s market share in coming years. On Monday, the two companies faced off in court, trying to settle a patent dispute relating to propriety interest in sofosbuvir — the compound forming Gilead’s megablockbuster HCV franchise consisting of Sovaldi and Harvoni. -
Gilead, Merck & Co. Duke It Out Over Hep C $1,000-Pill Royalties
Mar 8, 2016 | BioSpace
By Alex Keown
Gilead Sciences (GILD) could owe Merck (MRK) more than $3 billion in a patent dispute over its block buster hepatitis C treatment if a jury finds Merck’s own hepatitis C patents are still viable, Bloomberg reported this morning.
Client Attorney Privileged/Attorney Work Product/At Request of Counsel
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Mar 9, 2016 | Wall Street Journal
By Pete Loftus
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Pharmalot, Pharmalittle: Gilead and Merck battle over hepatitis C patents
Mar 8, 2016 | STAT
By Ed Silverman
Good morning, everyone, and how are you today? A warm, shiny sun is enveloping the Pharmalot campus, where both short people and the official mascots are sleeping in. As for us, no such luck. We are as busy as ever foraging for interesting items and keeping up with our expanding to-do list. No doubt, you can relate. So time to get cracking. Here is the usual menu of tidbits to get your started. Have a smashing day and do drop us a line if you run across anything fascinating …
A showdown between Gilead Sciences and Merck over patent rights for the Sovaldi and Harvoni hepatitis C treatments got underway Monday in a federal courtroom, The Recorder writes. At issue are two patents which Merck claims gave it rights to a class of nucleotides that could prove effective in treating hepatitis C. Merck also contends Gilead relied on this class of compounds and is seeking $3 billion in royalties for using its discovery.
The Gilead Sciences campaign to advertise its Harvoni hepatitis C treatment directly to consumers appears to be working as doctors report more patients asking for the medication, STAT writes. Patients “have Harvoni on the mind because of these TV commercials,” said Mount Sinai Hospital hepatologist Dr. Douglas Dieterich. So far, more than 11,000 ads have aired on TV, and the total value of the time slots is estimated at up to $80 million.
Valeant Pharmaceuticals will disclose its fourth-quarter results and update investors on its financial guidance next week, The Wall Street Journal says. The drug maker had planned to report results on Feb. 29, but postponed the session and withdrew the guidance the night before, because Michael Pearson, the chief executive, had just returned from medical leave.
The US Patent and Trademark Office begins a hearing Wednesday to determine whether the University of California or the Broad Institute and the Massachusetts Institute of Technology receive patents covering the use of CRISPR-Cas9, the genome-editing technology that is revolutionizing molecular biology, STAT writes.
Amgen is now “more energetic about being out there” and finding acquisitions, the biotech’s chief financial officer, David Meline, tells Bloomberg News. Two months ago, the company pointed to six therapeutic categories it plans to focus on, including cardiovascular and neuroscience, which would be newer areas for the biotech. Amgen has about $30 billion in cash and equivalents.
Sanofi Pasteur and Merck are ending their 22-year-old joint venture to develop vaccines for the European market, a move that comes as Sanofi undergoes a widespread reorganization.
A federal inspection report found a Theranos lab ran an important blood test on 81 patients over a six-month period despite erratic results from quality-control checks meant to ensure accuracy, The Wall Street Journal reports.
AbbVie is making a $595 million upfront payment to Boehringer Ingelheim as part of a plan to develop and commercialize a biologic drug in Phase 3 testing for psoriasis, Pharma Times says.
Celldex Therapeutics stock fell more than 50 percent Monday after saying it will discontinue a Phase 3 trial of a brain cancer treatment, MarketWatch writes.
Zydus Pharmaceuticals USA is recalling 9,504 bottles of the Risperidone antipsychotic tablets made in India by Cadila Healthcare, TwoFour Insight says.
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Merck, Gilead wrestle in court over $3B-plus in hep C royalties
Mar 8, 2016 | FiercePharma
By Tracy Staton
Merck & Co. isn't just battling Gilead Sciences for market share with its brand-new hepatitis C drug. It's also fighting in court for a multibillion-dollar piece of Gilead's blockbuster franchise.
Merck ($MRK) claims that it's entitled to 10% royalties on Gilead's ($GILD) sofosbuvir meds, including Sovaldi and the combo drug Harvoni, citing two patents registered in 2002. Gilead, on the other hand, claims that its Pharmasset scientists were already working on sofosbuvir before the patents were filed.
Merck's royalty claim, first made in 2013, would be worth more than $3 billion, based on the $31.7 billion Gilead has brought in from the breakthrough hepatitis C drug since its 2014 launch. And it's not baseless; last month, a federal judge decided that Sovaldi and Harvoni had infringed on Merck's patents.
Still, as Bloomberg reports, Gilead's lawyers told a San Jose, CA, jury Monday that Merck didn't invent the drug. Pharmasset, which Gilead bought for $11 billion in 2011, was working on it as early as 2001, before Merck won its patent rights, Gilead attorney Juanita Brooks said in court.
"It's clear whose invention this is," Brooks told the jury (as quoted by Bloomberg). "It's clear this is Pharmasset's invention and Gilead's acquisition. So why are we here?"
Merck disputes that, of course, contending that Pharmasset jumped on its 2002 patents to develop sofosbuvir. Its lawyer told the jury that sofosbuvir was ultimately derived from work done at Merck "before it was ever even a figment of the imagination at Pharmasset."
Hefty royalties would be a nice boost for Merck's hep C business, which is off to a late start in a market overwhelmingly dominated by Gilead's next-gen meds. Merck's Zepatier was approved earlier this year, joining Gilead's Sovaldi and Harvoni, and AbbVie's ($ABBV) Viekira Pak in a pitch for patients.
The current court fight is just one piece of the patent litigation over Gilead's hepatitis C drugs. Idenix, which Merck bought last year, had already sued Gilead--in France, Germany and the U.K., in addition to the U.S.--claiming that Gilead infringed one of its nucleoside patents. And AbbVie sued Gilead claiming that the company's two-in-one drug Harvoni stepped on one of its method patents for treating hep C.
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Rivalry Between Gilead & Merck Heats Up
Mar 8, 2016 | Bidness
By Hadia Taqi
Gilead Sciences, Inc. (NASDAQ:GILD) is facing a double threat from Merck & Co., Inc. (NYSE:MRK) in hepatitis C market. Earlier this year, the latter scored regulatory approval for its once-daily single-tablet HCV combo pill called Zepatier, which is expected to restrict Gilead’s market share in coming years. On Monday, the two companies faced off in court, trying to settle a patent dispute relating to propriety interest in sofosbuvir — the compound forming Gilead’s megablockbuster HCV franchise consisting of Sovaldi and Harvoni.
Patent Battle
The patent battle began at San Jose federal court in 2013 when Gilead sued Merck after being asked for royalty payment on Sovaldi (chemically called sofosbuvir) shortly before the Food and Drug Administration (FDA) approved it for treatment of HCV. Gilead said in its complaint that it considers the royalty as “prohibitive” just as it sees Merck’s request a “threat” to slap infringement claims over two of its patents (‘499 and ‘712) registered in 2002. Last month, a judge passed a ruling that a compound in Gilead’s HCV drugs did in fact infringe upon Merck’s patents. Decision on the validity of those patents now rests with a jury. Merck does not seek a ban on Gilead’s sale of its products if is found guilty — the latter may have to pay the former royalties on its sales in such a case.
In the opening statement on Monday, Gilead’s lawyer Juanita Brooks said that the compound in question was being worked on since at least 2001, a year before Merck earned patent rights it is now trying to enforce. She also reminded the jury that Gilead had acquired the compound from its $11 billion purchase of Pharmasset Inc. in 2001. “It’s clear whose invention this is,” Ms. Brooks said, and further added: “It’s clear this is Pharmasset’s invention and Gilead’s acquisition. So why are we here?”
Merck’s attorney, Bruce Genderson, claimed that Merck had come up with the compound “before it was ever even a figment of the imagination at Pharmasset” and had its patent published in 2002. Pharmasset then allegedly used the compound to manufacture sofosbuvir. “Gilead wants you to think Merck’s patents are based on Pharmasset’s inventions, but that’s just not true,” said Mr. Genderdon, “They were based on Merck’s own work over years.”
Why the Suit Doesn’t Matter
Note that sofobuvir is responsible for Gilead's unprecedented period of success since the launch of Sovaldi in December 2013. The biotech giant’s profit has increased nearly seven times in the past three years. Priced at $1000-a-pill, Sovaldi delivered over 90% cure rates for the liver disease within 12 to 24 weeks of treatment, down from a prior 24-48 weeks’ time. Gilead followed Sovaldi with its advanced combination drug, Harvoni, in October 2014 which lowered treatment time to as low as 8 weeks for many patients and cost an exorbitant $94,500 for a 12-week treatment.
The two drugs also nearly removed the need for side effect-ridden peginterferon administration. The HCV cures became the fastest-selling pharmaceutical products, pulling in about $19 billion in 2015 sales for the company and almost $31.7 billion since Sovaldi’s launch. If Gilead ends up losing the patent dispute case, it will have to pay royalties amounting to 10% of the amount it has made from sofosbuvir so far, which comes up to a little more than $3 billion.
Analysts, however, do not seem to be concerned. Bloomberg Intelligence analyst Asthika Goonewardene said in a note that Gilead can easily handle the charge. “Sure, investors won’t be thrilled, but that’s assuming Gilead rolls over and plays and dead and gives Merck 10 percent -- that’s highly unlikely,” he said. “A $3 billion charge will be uncomfortable, but no one is worried they can’t keep the lights on at night.” Jefferies analysts said in a detailed research report that any “potential impact of an adverse ruling” for Gilead will be “relatively modest.” They said a worst-case scenario for the giant will be payment of 10% royalties on Harvoni/Sovaldi’s US sales. "This would retroactively cover total U.S. net revenues amounting to about $2.3B in monetary relief, and a similar ongoing royalty on all future U.S. sales, impacting our DCF valuation for GILD by $3.20 (3.2%)," they said. In a more realistic scenario, Gilead may have to pay a low single-digit ongoing royalty.
Investors were unfazed with the court’s proceedings as well. Gilead shares jumped 2.8% in yesterday’s trade, mirroring the 3% rise of the iShares NASDAQ Biotechnology Index (IBB).
Merck’s Two-Pronged Threat
Note that Gilead continues to face significant threat from Merck in the HCV space, even if the patent dispute does not prove to be much of a problem. Merck’s newly launched HCV option, Zepatier, costs more than 30% less than the list prices of Harvoni and Sovaldi with a comparable level of efficacy and safety. While Gilead has offered its drugs to pharmacy benefit managers (PBMs) at discounts ranging above 40%, the after-discount cost of Zepatier will still be significantly less than theirs. Bernstein analyst Tim Anderson expects Merck to gain an 11% HCV market share by 2017, with Zepatier pulling about $2.2 billion in annual sales. Merck’s older HCV drugs, Victrelis and PegIntron, saw sales plunge nearly 63% year-over-year to $200 million in 2015. The drugs had combined sales of $1.2 billion in 2012 before sofosbuvir captured its market share.
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Gilead, Merck & Co. Duke It Out Over Hep C $1,000-Pill Royalties
Mar 8, 2016 | BioSpace
By Alex Keown
Gilead Sciences (GILD) could owe Merck (MRK) more than $3 billion in a patent dispute over its block buster hepatitis C treatment if a jury finds Merck’s own hepatitis C patents are still viable, Bloomberg reported this morning.
Merck challenged the patents for California-based Gilead’s hepatitis C treatments Sovaldi and Harvoni, both of which provide a near cure for the disease. Last month, a judge found that Gilead did infringe on Merck’s patents. Now, it’s up to the jury to determine if those patents are valid and how much Merck could be awarded in damages, Bloomberg reported. Merck is seeking 10 percent of sales of the drugs. At stake is billions of dollars in annual revenue for Gilead. Harvoni generated nearly $20 billion in sales in 2015. Harvoni and Sovaldi helped drive Gilead to a record revenue year in 2015, nearly $32 billion—more than three times what the company generated in 2012.
Gilead will argue that its scientists were working on the hepatitis C compounds before Merck secured its own patents. The company will argue that the compound has its roots at Pharmasset Inc. (VRUS), which Gilead acquired in 2011 for $11 billion, Bloomberg said. Merck will assert that its patents are its own and was used by Pharmasset to develop sofosbuvir, which became Harvoni. While there is a lot of money at stake, Merck is not seeking for Gilead to cease sales of Harvoni and Sovaldi in favor of its own recently approved hepatitis C drug, Zepatier.
Zepatier was granted breakthrough therapy designation for the treatment of chronic HCV genotype 1 infection in patients with end stage renal disease on hemodialysis and for the treatment of chronic HCV genotype 4 infection. Breakthrough therapy designation is a program designed to expedite the development and review of drugs that are intended to treat a serious condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over available therapy on a clinically significant endpoint.
But Gilead isn’t done developing treatments for hepatitis. In January, Gilead submitted a New Drug Application (NDA) to the U.S. Food and Drug Administration for tenofovir alafenamide, an investigational, once-daily treatment for adults with chronic hepatitis B virus infection. The company is also continuing to use Sovaldi in combination with other drugs, including a triplet drug comprised of Sovaldi, velpatasvir, and a protease inhibitor for the treatment of genotype 3 HCV patients. Also, in the waning days of 2015, Harvoni was approved for expanded use in patients with genotype 4, 5 and 6 chronic hepatitis C virus (HCV) infection and in patients co-infected with HIV by the FDA. In addition, Harvoni plus ribavirin (RBV) for 12 weeks was approved as an alternate therapy to 24 weeks of Harvoni for treatment-experienced, genotype 1 patients with cirrhosis.
Additionally, Gilead announced that the FDA granted priority review to the company’s NDA for an investigational, once-daily fixed-dose combination of the nucleotide analog polymerase inhibitor sofosbuvir, better known as Sovaldi, and velpatasvir, an investigational pan-genotypic NS5A inhibitor, for the treatment of chronic genotype 1-6 hepatitis C virus infection. Gilead filed the NDA for SOF/VEL on Oct. 28 and the FDA has set a target action date under the Prescription Drug User Fee Act (PDUFA) of June 28, 2016. The FDA has assigned SOF/VEL a Breakthrough Therapy designation, which is granted to investigational medicines that may offer major advances in treatment over existing options, Gilead said.
Client Attorney Privileged/Attorney Work Product/At Request of Counsel
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