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U.S. Could Make Millions in Gilead HIV Prevention Drug Suit (3)

Nov. 7, 2019, 3:47 AMUpdated: Nov. 7, 2019, 10:26 PM

The U.S. government could get millions from Gilead Sciences Inc. as the result of a recently filed lawsuit that alleges the company infringed government-owned patents for the HIV-prevention drug PrEP.

The Department of Health and Human Services is asserting that Gilead refused to license its patents and has “willfully and deliberatively induced infringement” on the department’s patents, according to the complaint.

The government is seeking retrospective damages and ongoing royalties from the company. The complaint alleges the company has made billions from sales of the drug. The pills can cost as much as $1,700 a bottle and earned the company $2.6 billion in U.S. sales in 2018, according to Bloomberg data.

The Centers for Disease Control and Prevention was the first to demonstrate that the combination of drugs that make up PrEP—emtricitabine and tenofovir disoproxil fumarate—are effective as HIV prevention. The only two approved HIV prevention drugs, Truvada and Descovy, are both made by Gilead.

The conflict over the HIV prevention drug patents has become more prominent since President Donald Trump announced a plan to reduce new instances of HIV by 90% in the next decade. There are about 40,000 new cases of HIV each year, according to the CDC.

The case will likely take two or three years, by which time there could be a change in administration, Chad Landmon, chair of the intellectual property and Food and Drug Administration practice groups at Axinn Veltrip & Harkrider. Gilead could hold out on any settlement in hopes of getting better terms from a new administration.

However, it’s unclear if the Democratic presidential candidates would be more willing to compromise with Gilead, as many have railed against drug companies.

There is also a good possibility the court will stay this case and wait for the U.S. Patent and Trademark Office’s administrative Patent Trial and Appeal Board to review claims by Gilead that the government’s patents are not valid, Landmon said.

The standards between the review and in court are different, but decisions by the patent board “usually have a big impact on the positions in these cases,” Landmon said.

(Updates with additional reporting from a Nov. 6 story)

To contact the reporter on this story: Shira Stein in Washington at sstein@bloomberglaw.com

To contact the editor responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com

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