Once again, Gilead Sciences (GILD) finds itself defending a challenge to a patent for its groundbreaking hepatitis C treatments. The latest test comes from the University of Minnesota, which filed a lawsuit arguing the drug maker infringed a patent pertaining to the blockbuster Sovaldi medicine, as well as two follow-up drugs, Harvoni and Epclusa.
In its lawsuit, which was filed in federal court on Tuesday, the university maintained that all three drugs are covered by patent rights that were assigned to the school by Dr. Carston Wagner, a professor and an endowed chair in the department of medicinal chemistry in the university’s college of pharmacy. The school contended that he received the patent in August 2014.
The patent refers to “antiviral compounds and methods for using those compounds to treat viral infections, such as that caused by hepatitis C virus,” the lawsuit states. “The importance of Dr. Wagner’s contributions … as disclosed and claimed in the patent, was widely recognized by his peers in the scientific community. Gilead’s medicines incorporate these contributions.” (Here are the exhibits).
A Gilead spokesman wrote us that the company “strongly believes that it has the sole right to commercialize (Sovaldi) in the US. We believe the University of Minnesota’s patent is invalid and is not infringed by the sale of Gilead’s medicines for chronic hepatitis C.”
Such disputes are not uncommon, but the Gilead hepatitis C drugs have generated a bonanza — more than $19 billion in sales last year, although Epclusa was not available until recently. This explains why patent challenges to its hepatitis C products are closely watched. Sales have slowed recently, but investors, in particular, still want to know if this highly lucrative revenue stream might be further diminished.
There was, for instance, intense interest in recent patent litigation between Gilead and Merck. In that case, Merck sought royalties from Gilead, claiming the compounds Gilead purchased from another company closely mimicked the hepatitis C compounds Merck researched a dozen years earlier. Gilead filed a lawsuit in response, arguing the Merck patents were invalid. A jury agreed, but the verdict was overturned two months ago after a federal court judge determined a Merck attorney had lied.
However, consumer groups have also pointed to Gilead patents as an example of a broken patent system. These groups lost a round last May, though, when Indian officials reversed course and granted a patent to Gilead Sciences for Sovaldi. A year earlier, the Indian Patent Office rejected the company’s patent application on the grounds that it was not a significant improvement compared with an earlier compound developed by another company.
Whether the litigation with the University of Minnesota holds the same potential for such drama is unclear. The school is claiming the patent that was infringed only refers to the technique for having the drugs absorbed in the body, not the basis compound.
“I think they’re just trying to get a payoff,” said Tahir Amin, director of intellectual property at IMAK, an advocacy group that battled Gilead in India and is challenging Sovaldi patents in other countries. “I think this just goes to show what we’ve been saying all along — this kind of science is commonly used. They’re just staking a claim for their own purposes. Unfortunately, the patent system creates monopolies when, in such instances, no one should have exclusivity on old science.”