It took almost 6 years, but Pfizer ($PFE) and Brigham Young University have finally come to terms. The drugmaker agreed to pay $450 million to settle a lawsuit claiming that BYU deserved billions in royalties for helping develop Pfizer's pain drug Celebrex.
The company disclosed in a Securities and Exchange Commission filing that it took a $450 million charge against first-quarter earnings to cover the settlement, but the terms of the agreement weren't otherwise announced. Except for the fact that BYU will set up a Dan Simmons Chair in honor of the professor involved in the original, disputed research.
BYU contended in the 2006 lawsuit that Simmons discovered an enzyme and related gene--Cox 2--and created a drug-development target in the process. BYU inked an R&D deal with Monsanto ($MON) that included royalty payments. After the resulting drug--Celebrex--changed hands in one merger after another, Pfizer acquired it along with Pharmacia in 2002. In suing Pfizer, BYU claimed it was owed $9.7 billion in royalties.
The settlement amounted to much less. Considering Celebrex's long track record--its sales were among the bright spots in Pfizer's first-quarter report, many years after its first approval--a $450 million wrap-up seems favorable. "We are pleased to resolve this matter and the uncertainty of litigation and to be in a position to support Dr. Simmons' research efforts at BYU," the company said in its statement.
- get the release from Pfizer
- read The Salt Lake Tribune story