After a run of court victories in a five-year patent dispute with the U.S. government, Gilead Sciences has agreed to settle with the Department of Justice (DOJ) and the Department of Health and Human Services (HHS) to resolve the feds’ last-ditch appeal.
Terms of the deal were not disclosed in the case, which involved the government’s patents on Gilead’s HIV drugs Truvada and Descovy for pre-exposure prophylaxis (PrEP). The government was appealing a federal court verdict that had invalidated its patents and two U.S. court decisions that concluded the government breached contracts with Gilead.
The case surrounds a research collaboration between Gilead and the Centers for Disease Control and Prevention (CDC) two decades ago to discover whether Truvada—which was approved in 2004 to treat HIV—could also prevent the infection.
“Today’s settlement ends this litigation and this final resolution allows Gilead to continue to focus its resources on its mission to discover, develop, and deliver innovative therapeutics to people with life-threatening diseases,” Deborah Telman, Gilead’s general counsel, said in a release.
Additionally, Gilead said it will receive a license to “certain current and future government PrEP patents that will protect Gilead’s freedom to operate for years to come.”
The DOJ and the HHS did not respond immediately to a request for a comment.
After the government secured the patents, it offered Gilead a chance to license them in exchange for a royalty. When the company refused, the government sued in 2019, claiming Gilead had reaped profits from hundreds of millions of dollars in taxpayer-funded research.
In response, Gilead filed a lawsuit against the government in 2020, claiming it breached five contracts from their research collaboration by granting the CDC patents. In 2022 and 2024 decisions, the U.S. Court of Federal Claims upheld Gilead’s claim.
In 2023, a Delaware jury ruled unanimously that Gilead did not infringe the patents. The court also determined that the patents were invalid due to obviousness, freeing the company from paying a $1 billion penalty the government had sought.
Wednesday’s settlement quashed the government’s appeal of the 2023 verdicts.
“Gilead is proud to have invented and developed Truvada and Descovy, and to have brought these life-changing innovations to people in need,” Telman added. “Gilead continues to champion collaborations, including our efforts with HHS that span more than 15 years, as we all work together toward our common goal to end the HIV epidemic.”
Truvada was a blockbuster by 2006 in its second full year on the market. After it was approved as a PrEP med in 2012, Truvada generated at least $3 billion in annual sales for seven straight years.