Gilead faces another bid for hep C royalties as U of MN sues for patent infringement

The University of Minnesota wants a piece of Gilead Sciences’ megablockbuster hepatitis C business. 

The school sued Gilead for patent infringement Monday, claiming that the drugmaker’s sofosbuvir-based meds violate its intellectual property rights. It's seeking “no less than a reasonable royalty” on the drugs’ multibillion-dollar sales.

At issue is a patent granted to the university by Dr. Carston Wagner, an endowed chair in its pharmacy college. Gilead maintains the patent is invalid.

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The lawsuit names Gilead’s Sovaldi, Harvoni and brand-new Epclusa, which together brought in more than $8 billion during the first half of this year. The sofosbuvir franchise delivered a whopping $19 billion in 2015, Harvoni’s first full year on the market. Sovaldi launched in late 2013.

“Gilead has reaped tens of billions of dollars in sales of those drugs, without the University’s authorization and without compensating the University,” the lawsuit states. “The University invests heavily in the important and groundbreaking work of its professors, and it takes seriously its role in defending their and the University’s intellectual property rights.”

Drug royalties can be rich revenue streams for universities. Eli Lilly & Co. has paid Princeton University hundreds of millions of dollars in royalties on its cancer drug Alimta, and Northwestern University has added about $1.4 billion to its endowment in recent years, thanks to royalties on Pfizer’s pain drug Lyrica.

If Gilead has its way, however, the University of Minnesota won’t be one of them.

“Gilead strongly believes that it has the sole right to commercialize sofosbuvir in the U.S.," the company said in an emailed statement. "The University of Minnesota did not invent sofosbuvir, nor did they contribute to its development. We believe their patent to be invalid and not infringed by the sale of Gilead’s medicines for chronic hepatitis C.”

The university says Wagner’s patent covers antiviral compounds, and methods for using them to treat infections by viruses such as hepatitis C. His relevant patent, “Nucleosides with Antiviral and Anticancer Activity,” was the fruit of his research into nucleotide prodrugs and HINTs, in this case, histadine triad nucleotide-binding protein 1.

Sofosbuvir was the first of a new class of hepatitis C drugs known as “nucs,” short for nucleotide analog inhibitor. It is a prodrug, which means that it converts to another systemically active substance after a patient takes a dose.

“The importance of Dr. Wagner’s contributions to the design of prodrugs of nucleotide analogs ... was widely recognized by his peers in the scientific community,” the lawsuit states. “Gilead’s sofosbuvir medicines incorporate these contributions of Dr. Wagner.”

This isn’t the first time Gilead has faced an intellectual property challenge on its suite of hep C meds. Merck & Co., which markets a rival product, Zepatier, and its partner Ionis demanded royalties on the sofosbuvir-based drugs, and Gilead sued, asking the court to declare Merck’s patent invalid. In March, a jury ruled for Merck, awarding the U.S.-based drugmaker $200 million in damages and potential royalties on Gilead’s drug sales.

But the judge reopened the case and, in June, overturned the jury verdict after finding “a pervasive pattern of misconduct” on Merck’s side of the fight. Merck says it will appeal.

Special Report: The top 20 drugs by 2020 - Harvoni

Related Articles:
Judge nixes Merck's $200M hep C patent win, citing 'pervasive' misconduct 
Pfizer's Lyrica success a boon for Northwestern University endowment
Merck wins first round in $3B-plus hep C royalty fight with Gilead 
Merck's $200M damages in Gilead hep C case falls far short of expectations
Eli Lilly's Alimta gains may cause Princeton pain

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