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Merck Gilead Patent Trial 3/10/16
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Stock Futures Jump as ECB Introduces More Stimulus
Mar 10, 2016 | The Street
By Keris Alison Lahiff
Stock futures surged Thursday morning after the European Central Bank introduced more stimulus to revitalize the eurozone economy. -
Merck Goes To Court Against Gilead Sciences
Mar 10, 2016 | Bidness
By Aliya Kaleem
The heated battle between Gilead Sciences, Inc. (NASDAQ:GILD) and Merck & Co., Inc. (NYSE:MRK) is gaining momentum, as the drug makers face off in court. Gilead is confident it will dispose off Merck’s patent claims against its HCV drugs: Sovaldi and Harvoni. -
Gilead and Merck lock horns in court over sofosbuvir patent
Mar 10, 2016 | BioPharmaDIVE
By Nicole Gray
A trial in a California federal court between Gilead and Merck began this week over patents to ingredients in Gilead's blockbuster hepatitis C treatments, the Wall Street Journal reports.
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Stock Futures Jump as ECB Introduces More Stimulus
Mar 10, 2016 | The Street
By Keris Alison Lahiff
Stock futures surged Thursday morning after the European Central Bank introduced more stimulus to revitalize the eurozone economy.
S&P 500 futures rose 0.41%, Dow Jones Industrial Average futures gained 0.32%, and Nasdaq futures were up 0.44%.
The ECB lowered the benchmark interest rate to zero, while cutting its deposit facility rate to minus 0.4%. The central bank also expanded its monthly asset purchases to 80 billion euros, beginning next month.
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The majority of economists surveyed expected further monetary easing measures from the ECB, especially another cut to the deposit rate and a boost to its bond-repurchasing program. ECB President Mario Draghi will hold a press conference at 8:30 a.m. EST.
Chinese stocks slid after consumer inflation rose at a faster-than-expected pace, a troubling sign as the country's central bank attempts to stabilize falling economic growth. Inflation rose 2.3% in February, its fastest pace since mid-2014 and above estimates of 1.9% growth. The Shanghai Composite fell 2%.
Dollar General (DG - Get Report) added more than 4% in premarket trading after beating quarterly estimates and raising its quarterly dividend. The discount retailer reported a 2.2% increase in same-store sales, driven by revenue in candy and snacks and other perishables. The company increased its dividend 14% to 25 cents a share and also said it expects to repurchase $1 billion in shares in fiscal 2016.
Nasdaq (NDAQ) has agreed to buy U.S. options exchange International Securities Exchange for $1.1 billion from Deutsche Boerse. Deutche Boerse's sale could be a move to bolster its balance sheet as it seeks a merger with the London Stock Exchange. Deutsche has written down the International Securities Exchange several times since acquiring it in a $2.8 billion deal in 2007.
Square (SQ) climbed more than 1% after reporting a 49% surge in quarterly sales in its first earnings report since going public. The payments site reported a loss of 34 cents a share, more than double estimates, though sales of $374.4 million came in above forecasts.
Gilead (GILD - Get Report) and Merck (MRK - Get Report) shares were on watch as the two drugmakers prepare to battle one another in a California courtroom this week. Merck is arguing that Gilead's hepatitis C drugs Sovaldi and Harvoni infringe upon two of its patents and so deserves royalties. The drugs generated sales of $12.5 billion in the U.S. last year.
Box (BOX - Get Report) jumped more than 11% following positive guidance for the full year. The cloud-computing company anticipates a loss of 83 cents to 85 cents a share in fiscal 2016, narrower than an estimated 88-cent loss. Box reported a fourth-quarter loss of 26 cents a share, better than a forecast loss of 29 cents.
Gilead (GILD - Get Report) and Merck (MRK - Get Report) shares were on watch as the two drugmakers prepare to battle one another in a California courtroom this week. Merck is arguing that Gilead's hepatitis C drugs Sovaldi and Harvoni infringe upon two of its patents and so deserves royalties. The drugs generated sales of $12.5 billion in the U.S. last year.
Bo (BOX - Get Report) jumped more than 11% following positive guidance for the full year. The cloud-computing company anticipates a loss of 83 cents to 85 cents a share in fiscal 2016, narrower than an estimated 88-cent loss. Box reported a fourth-quarter loss of 26 cents a share, better than a forecast loss of 29 cents.
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Merck Goes To Court Against Gilead Sciences
Mar 10, 2016 | Bidness
By Aliya Kaleem
The heated battle between Gilead Sciences, Inc. (NASDAQ:GILD) and Merck & Co., Inc. (NYSE:MRK) is gaining momentum, as the drug makers face off in court. Gilead is confident it will dispose off Merck’s patent claims against its HCV drugs: Sovaldi and Harvoni.
Context
The patent fight began in 2013, when Gilead sued Merck, for the latter's patent claim against sofosbuvir, the main ingredient in Gilead’s HCV drugs. Merck said Gilead’s drugs infringed two of its patents covering related compounds, which it registered in 2002.
Merck is asking for Gilead to be ordered to pay damages, covering the royalties on the sales of Sovaldi and Harvoni.
Gilead’s lawsuit against Merck is currently underway in federal court. Last month, the judge said he agreed Gilead infringed Merck’s patents, but the jury will have the final word after it reviews the validity of the patents.
Gilead’s Stance
Gilead maintains Merck’s claims are invalid, and that it is not obliged to pay Merck anything. Gilead considers Merck’s demand for royalties as “prohibitive,” and is unwilling to share the figures of the sales of the two drugs.
Last month, Gilead established that Merck’s patent applications were not specific to its HCV drugs, and additional claims were added after initial submissions. By that time, Pharmasset, the company initially responsible for the advent of sofosbuvir, had already submitted the patent applications of its products. Gilead acquired the rights to sofosbuvir after its acquisition of Pharmasset.
Gilead’s response in the court filing was: "Simply put, Merck's asserted patents claim work Merck never did, and ideas Merck never had. The asserted claims are invalid and Merck should collect nothing."
Merck’s Stance
Merck attorney Bruce Genderson, said Merck had devised the compound “much before it was ever even a figment of the imagination at Pharmasset.”
It has also stressed that the patent was originally published in 2002, and that the following additional claims filed by Gilead were not related to HCV compounds. It was only after Merck acquired patents in 2002 that Pharmasset began using the compound to manufacture sofosbuvir.
Mr Genderdon said: “Gilead wants you to think Merck’s patents are based on Pharmasset’s inventions, but that’s just not true. They were based on Merck’s own work over years.”
A Merck spokeswoman recently said: “the compound was purely a result of many years of research of the company and its partners which made investments that led to significant advances in the treatment of hepatitis C, and were appropriately granted patent protection."
Gilead Has Nothing To Lose
Gilead is the undisputed leader in the rapidly growing HCV drugs market, with a 90% share of the segment. Its HCV drugs portfolio has experienced soaring growth in the last three years, and the company's profits have increased almost seven times.
Sovaldi, launched initially in December 2013, was priced at $1000 per pill, and established itself as a breakthrough HCV treatment, with 90% cure rates in 12 to 24 weeks of treatment. Harvoni, an advanced combination drug, launched in October 2014, brought treatment duration even lower: to 8 weeks. The drug was priced at a hefty $94,500 for a 12-week regimen.
Gilead’s HCV drugs portfolio gathered a hefty $19 billion in global sales in 2015, with $12.5 billion coming from the US alone. The company has made about $31.7 billion in sales since the launch of Sovaldi in 2013.
Since Merck is only seeking royalties (10% of the sales of Sovaldi and Harvoni during three years), Gilead does not face the prospect of a ban. This comes to about $3 billion, which is significant, but not damaging for a biotech giant of Gilead's size.
In a note, Bloomberg intelligence analyst Asthika Goonewarden, recently wrote: “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.”
She added: “A $3 billion charge will be uncomfortable, but no one is worried they can’t keep the lights on at night.”
It seems Gilead investors have hardly taken heed of recent events. Shares are up 0.71% since Monday, which is when the court proceedings began. The stock has also outperformed the market; the iShares NASDAQ Biotechnology Index (IBB) lost 2.27% in the same timeframe.
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Gilead and Merck lock horns in court over sofosbuvir patent
Mar 10, 2016 | BioPharmaDIVE
By Nicole Gray
Dive Brief:
A trial in a California federal court between Gilead and Merck began this week over patents to ingredients in Gilead's blockbuster hepatitis C treatments, the Wall Street Journal reports. Although Gilead launched Sovaldi (sofosbuvir) in 2013, Merck claims it patented key nucleosides related to sofosbuvir in 2002. Merck had demanded a 10% royalty of sales of Gilead's Harvoni and Sovaldi, leading to a 2013 counter-suit by Gilead. Gilead bought the patents to sofosbuvir in 2011 when it acquired Pharmasset for $11 billion.
Dive Insight:
Within a year of its launch in December 2013, Sovaldi became the second-best selling drug in the world after AbbVie's Humira (adalimumab). Gilead followed up on that success with Harvoni, which combines sofosbuvir with ledaspavir. In 2015, Harvoni generated nearly $14 billion in global sales.
Opening statements were held earlier this week, as the opposing lawyers lay out the competing arguments. Merck's claim to the nucleosides includes its 2002 patent, which covers 150 different compounds and gives it a broad basis for claiming patent rights to different compounds.
However, Gilead's attorney told the court, "In this world, the smallest change can make the biggest difference," according to the Recorder. In this case, it is a difference potentially worth billions of dollars.
Gilead is arguing it owes Merck nothing because the 2002 patents aren't specific enough to cover Gilead's patent for sofosbuvir.
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