Judge Orders Novartis to Cough Up $178 Million to Plexxikon Over Patent Infringements


In California, a federal jury declared Thursday that Novartis’ Tafinlar infringed on two cancer drug patents owned by Daiichi Sankyo’s Plexxikon. As a result, Novartis has been ordered to pay Plexxikon $178 million for damages related to the alleged patent infringement.

The patents owned by Plexxikon are for compounds that reduce cancer cell growth and were initially developed in 2005. The company’s inventions helped in the co-development of Zelboraf, a melanoma drug, with Roche. In 2011, Plexxikon received approval for Zelboraf, while GlaxoSmithKline (GSK), which traded the drug to Novartis in 2015, applied for its Tafinlar patents in 2008 and received approval in 2013.

In 2017, a suit filed by Plexxikon alleged Novartis infringed on two patents covering the former company’s skin cancer drug Zelboraf. The most recent verdict may represent a likely financial blow for Novartis, as the company’s competing cancer drug Tafinlar and companion melanoma therapy Mekinist produced $1.5 billion in 2020 alone. In the first quarter of this year, the drugs generated $393 million.

Previously, Novartis claimed the patents held by Plexxikon were invalid, primarily because three GSK compounds preceded the patents. Unfortunately for Novartis, the jury found the company was unable to prove these claims.

The most recent in-person trial began July 12 and relied on testimony from company executives and scientists. In an email interview published with Reuters, Plexxikon's attorney Daralyn Durie of Durie Tangri said the judge overseeing the case would enact a royalty on Novartis from this point forward. Additionally, the judge may further increase the award, pending the jury’s decision on whether Novartis willfully infringed on Plexxikon's patents.

Tafinlar overtook Zelboraf following its arrival to the market, which may have fueled the animosity between the two companies. In 2016, Zelboraf reported sales of $218 million, while Tafinlar generated $672 million sales in the same year. 

In another recent legal move involving other patents, Novartis took Roche to court for over $210 million licensing fees. The suit is regarding a 16-year-old patent deal, which was originally created in 2005 when Chiron made payments to Roche’s Genentech. Novartis acquired Chiron in 2006 for $5.1 billion.

Chiron’s drug Ilaris (canakinumab), which is used for inflammatory diseases, generates approximately $900 million per year. In contrast, Novartis’ best-selling psoriasis drug Cosentyx has produced nearly $4 billion sales per year. 

“Novartis subsequently discovered that it mistakenly overpaid,” according to a statement made by Novartis attorneys in a redacted June 24 filing in the U.S. District Court in California. “Genentech was aware or should have been aware that Novartis had overpaid…to Genentech throughout the term of the Agreement. By mistake, Novartis overpaid…to Genentech on its drug products, Ilaris and Cosentyx, to which Genentech was not entitled.”


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