Federal Judge Reverses Merck & Co.’s $200 Million Patent Win Against Gilead Over False Testimony

Published: Jun 09, 2016

Federal Judge Reverses Merck’s $200 Million Patent Win Against Gilead Over False Testimony June 7, 2016
By Alex Keown, BioSpace.com Breaking News Staff

SAN FRANCISCO – A federal court judge reversed a $200 million award against Gilead Sciences over claims of patent violations for its blockbuster hepatitis C drugs after finding patterns of misconduct on the part of the plaintiffs, Merck & Co. .

In her ruling, U.S. District Judge Beth Labson Freeman decried a Merck scientist for falsifying his testimony and claimed that Merck supported his “bad faith conduct,” Bloomberg reported Monday afternoon.

The ruling made Monday caused shares of Gilead to briefly spike in an after-market trading. Shares soared from the closing price of $87.60 to $107.87, before falling back.

In March, a jury awarded Merck $200 million over patent violations, but a judge reopened the trial after questions arose over the testimony of Phil Durette. Gilead argued its scientists were working on the hepatitis C compounds before Merck secured its own patents. The company argued that the compound has its roots at Pharmasset Inc. , which Gilead acquired in 2011 for $11 billion. Gilead claimed that Durette’s testimony relied upon work previously done by Pharmasset Inc., a company that was later acquired by Gilead. There was enough evidence supporting the claim that Freeman reopened the case.

In its argument regarding Durette, Gilead said that in 2004, when Merck was considering its own acquisition of Pharmasset, Durette participated in a conference call where that company’s hepatitis drugs were discussed. Initially he told the jury he wasn’t on that call, but then later recanted, saying he “forgot” he was on the call, Bloomberg reported in March. Merck claims Durette’s changing testimony was not intentional, saying that the scientist acknowledged that “he’d been on the call once his personal notes confirmed it,” Bloomberg reported.

Freeman’s ruling was a good one for Gilead. While the company currently dominates the HCV market with Harvoni and Sovaldi. But there are new options available for treatment which are not as expensive as Gilead’s drugs, which carry a price tag of about $1,000 per pill. One of those treatments now available is Merck’s recently approved hepatitis C drug, Zepatier. Zepatier was granted breakthrough therapy designation for the treatment of chronic HCV genotype 1 infection in patients with end stage renal disease on hemodialysis and for the treatment of chronic HCV genotype 4 infection.

Merck has vowed to appeal Freeman’s reversal. The company told Bloomberg that Freeman’s ruling does not reflect the “facts of the case.”

“In its decision, the jury recognized that patent protections are essential to the development of new medical treatments,” the company said in an email, Bloomberg reported. “The compounds and methods at issue in this case facilitated significant advances in the treatment of patients with HCV infection, and achieving these advancements required many years of research and significant investment by Merck and its partners.”

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