Patent-infringement verdict against Abbott overturned
Abbott Laboratories, maker of the arthritis drug Humira, succeeded in a bid to overturn a $1.67 billion patent-infringement verdict won by Johnson & Johnson.
The 2009 verdict, the largest patent-related damages award in U.S. history, was reversed today by the U.S. Court of Appeals for the Federal Circuit in Washington, according to the court's website. The three-judge panel ruled the patent, co-issued to New York University and J&J's Centocor unit, is invalid.
J&J, which sells the competing arthritis medicine Remicade, had convinced a jury that Abbott infringed the patent, which J&J said covered the human antibodies used in Humira. The appeals court ruled that J&J's patent application never described fully human antibodies and said at most the claims “constitute a wish list of properties” that such an antibody would have.
“The opinion confirms that you can't claim what you didn't invent,” said William Lee of WilmerHale in Boston, who represented Abbott in the case.
Rob Bazemore, president of the Centocor unit, said in a statement the company is considering whether to ask the panel to reconsider its decision or request that the case be heard by all active judges of the court.
Humira is Abbott's biggest drug with $6.55 billion in sales worldwide last year, or about 18 percent of the Libertyville Township-based company's total revenue, according to data compiled by Bloomberg. Remicade is J&J's largest drug product, accounting for about 7.5 percent of the New Brunswick, New Jersey-based company's business, or $4.61 billion in sales.
J&J fell 5 cents to $60.60 at 1:29 p.m. in New York Stock Exchange composite trading. Abbott fell 44 cents to $46.53.
Humira blocks action of tumor necrosis factor, or TNF. When the body produces too much TNF, it can cause the immune system to attack healthy tissue and leads to inflammation.
J&J sued in 2007, seeking royalties and compensation for what it said was unauthorized use of the patent. Abbott argued that J&J's patent doesn't cover the human antibodies that are used in Humira, and they are invalid because scientists couldn't make fully human antibodies against TNF in a laboratory in 1994, the date set by the trial court as the time of the invention.
J&J's Remicade is made with a combination of mouse and human antibodies. J&J and NYU argued the patent covers both the combination and fully human antibodies against TNF.
A federal jury in Marshall, Texas, agreed and in June 2009 said Abbott owed $504 million in patent royalties to J&J based on sales of Abbott's Humira arthritis drug, plus $1.17 billion to compensate J&J for decreased sales of its competing treatments. The trial judge later added $175.6 million in interest, bringing the total to $1.84 billion.
The Federal Circuit today ruled that J&J failed to show it described fully human antibodies in 1994, when it sought patent protection. The elements of the patent asserted against Abbott are therefore invalid because they don't adequately describe the invention, the court said. Inventors are required to provide descriptions so others may emulate or build on the work.
“The evidence clearly showed that Abbott was first to invent a fully human anti-TNF antibody, Humira,” said Scott Stoffel, a spokesman for Abbott.
Abbott has filed its own lawsuit against the Centocor unit, claiming J&J's arthritis drug Simponi, made with human antibodies, is infringing an Abbott patent. It also claims a J&J psoriasis medicine, Stelara, violates two other patents. Those cases are pending in federal court in Worcester, Massachusetts.
Arthritis, which involves the breakdown of the cartilage protecting joints, affects one out of seven Americans, or 37 million people, according to the National Institutes of Health. Three of the largest drugs used to treat arthritis are Humira, Remicade and Enbrel, which generated $3.53 billion in sales last year for Thousand Oaks, California-based Amgen Inc.
The case is Centocor Inc. v. Abbott Laboratories, 10-1144, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court case is Centocor Inc. v. Abbott Laboratories, 07cv139, U.S. District Court, Eastern District of Texas (Marshall).