Roche escapes Igen damages, but loses ECL rights

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Related tags: Roche, License

A US appeals court has reversed an earlier decision to make
Switzerland's Roche pay almost $500 million in damages to Igen in a
dispute over a technology used in clinical diagnostics and
pharmaceutical research.

A US appeals court has reversed an earlier decision to make Switzerland's Roche pay almost $500 million in damages to Igen in a dispute over a technology used in clinical diagnostics and pharmaceutical research.

However, in what seems to be something of a no-win situation, Roche's German subsidiary, Roche Diagnostics (formerly Boehringer Mannheim) has lost its license to use Origen, Igen's electrochemiluminescence (ECL) technology, a component of the Swiss firm's Elecsys range of diagnostics. ECL uses light-emitting reagents to detect the presence of biological substances, and Roche's sales of the technology are thought to amount to over $400 million a year.

The appeals court freed Roche from an obligation to pay $486 million in damages, but said the company will still have to pay Maryland, USA-based Igen $18 million relating to unpaid royalties, out-of-field sales and improvements to the Origen technology that Roche did not pass on to its former partner.

The litigation between the two companies dates back to 1997, when Igen accused Roche of breaching the terms of a licensing deal on a number of counts, including the development of a competing technology and the settlement in 1998 of a patent dispute with rival firm Serono without Igen's consent. Moreover, Igen maintained that Roche had been selling the product to pharmaceutical industry clients; the companies' initial agreement gave it rights to market the technology only to clinical laboratories and blood banks.

Igen said that it has already initiated patent infringement lawsuits in the USA and Germany seeking to prevent Roche from selling any further Elecsys products. The company makes around half of its annual revenues from royalties on Roche sales, but maintained that the termination of the licensing agreement would free it up to seek partners elsewhere.

For its part, Roche maintains that ECL is lessening in importance for its diagnostics division as it invests heavily in newer technologies serving the genomics and proteomics markets.

Related topics: Preclinical Research

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