Gilead Wins Reversal of $1.2 Billion Bristol-Myers Decision (2)

Gilead Sciences Inc. persuaded a U.S. appeals court to reverse a $1.2 billion judgment Bristol-Myers Inc. had won over revolutionary treatments that use a body’s own immune system to fight cancer.

A patent owned by Bristol-Myers’s Juno Therapeutics and the Sloan Kettering Institute for Cancer Research is invalid, the U.S. Court of Appeals for the Federal Circuit ruled. The jury verdict that upheld the patent was “not supported by substantial evidence,” the three-judge panel ruled.

The fight was over a pioneering technique known as CAR-T, in which the T cells of a person’s own immune system are modified to attack cancer cells. Gilead’s Kite unit makes Yescarta for the treatment of certain types of large B-cell lymphoma, a blood cancer, and a jury in 2019 said Bristol-Myers and Sloan Kettering were entitled to royalties on sales of the medicine.

Kite successfully argued on appeal that the patent didn’t adequately describe an invention and instead would “cover an enormous number (millions of billions)” of potential candidates. The patent’s “written description contains scant details” of which specific antibody would work, Chief Judge Kimberly Moore wrote for the court.

Bristol-Myers can ask the panel to reconsider its decision, or petition to have the case reviewed before all active members of the court, though such requests are rarely granted.

“We disagree with the Federal Circuit’s decision to undo the jury’s verdict and the district court’s well-reasoned decision, finding that our intellectual property has been infringed, and intend to seek review,” the company said in a statement.

Bristol-Myers said the decision “does not have any impact on the development of any of BMS’s CAR-T assets.” The New York-based company received regulatory approval in February for Breyanzi, its CAR-T treatment for adults with relapsed or refractory large B-cell lymphoma.

Foster City, California-based Gilead said in a statement it was pleased the court “has agreed with our long-held view that Juno’s patent claims are invalid” and called it “especially rewarding that the decision was unanimous and considered the trial record carefully.”

Yescarta and another cell-therapy drug, Tecartus, generated $607 million in sales last year.

Immunotherapy helped spur a takeover bonanza in the drug industry, including Gilead’s $12 billion purchase of Kite in 2017. Juno, which holds the license to the patent at the heart of the trial, was bought by Celgene Corp. for $9 billion in 2018 and Celgene in turn was bought by Bristol-Myers for $74 billion.

The dispute started when Juno and Kite were both standalone companies, even before Yescarta went on sale. Bristol-Myers argued that Kite copied a treatment that had been developed by researchers at Memorial Sloan Kettering Cancer Center and licensed to Juno for development of a cancer treatment. Juno and Sloan Kettering filed the lawsuit on the same day that Yescarta received U.S. regulatory approval.

The jury initially awarded $585 million in damages plus a 27.6% running royalty on sales of Yescarta. The damage award later grew to $1.2 billion after enhanced damages.

The case is Juno Therapeutics Inc. v. Kite Pharma Inc., 20-1758, U.S. Court of Appeals for the Federal Circuit (Washington).

(Updates with Gilead comment in eighth paragraph.)

--With assistance from Christopher Yasiejko.

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Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editors responsible for this story:
Jon Morgan at jmorgan97@bloomberg.net

Susan Decker

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