Seattle Genetics Claims Arbitration Rights in Daiichi Sankyo ADC Dispute

Seattle Genetics is looking for a quicker path to resolution with Daiichi Sankyo over antibody drug conjugate technology that both companies claim ownership of. Seattle Genetics is pushing for arbitration and also filed a motion to dismiss Daiichi Sankyo’s lawsuit that was initiated last month.

In a filing with the court, Seattle Genetics claimed the right to arbitration to resolve the dispute with Daiichi Sankyo, as is required by the 2008 collaboration agreement. The company said the arbitration agreement trumps the Declaratory Judgement Daiichi Sankyo filed in November. Daiichi Sankyo said the Seattle Genetics claim has no merit.

In an email statement, Seattle Genetics said their course of seeking to dismiss the lawsuit is due to the arbitration agreement.

“We asked the Court to dismiss Daiichi Sankyo’s lawsuit because it is improper. Daiichi Sankyo cannot proceed with its complaint against Seattle Genetics except in arbitration, as required in the parties’ 2008 collaboration agreement,” Seattle Genetics said.

At the crux of the dispute between the companies is the technology supplied by Seattle Genetics to Daiichi Sankyo under the agreement that allowed the company to develop ADCs for cancer. Between July 2008 and June 2015, Seattle Genetics and Daiichi Sankyo collaborated in an exclusive, worldwide development agreement focused on ADCs which are distinct from ADC products currently being developed in the Daiichi Sankyo pipeline. The candidates developed by Daiichi Sankyo generated significant interest from AstraZeneca, which signed a development and commercialization deal for an ADC called trastuzumab deruxtecan (DS-8201). That ADC stemmed from that partnership with Seattle Genetics, the company claims. DS-8201 is the lead compound in the ADC franchise of the Daiichi Sankyo Cancer Enterprise and targets HER2-expressing cancers. DS-8201 is currently worth a lot of money, potentially in the billions of dollars range. In March, AstraZeneca paid Daiichi Sankyo $1.35 billion in upfront monies as the U.K. company sees significant potential for DS-8201 as a treatment for HER2-positive breast and gastric cancers. If certain developmental and regulatory milestones are hit, Daiichi Sankyo could receive up to $6.9 billion from the deal with AstraZeneca.

Seattle Genetics believes that since DS-8201 stemmed from its collaboration with Daiichi Sankyo, then it is entitled to a share of that money.  Daiichi Sankyo disagrees. In its own filing, the company claims that it alone owns the drug conjugations liner technology used to develop its ADC products, particularly the patents on the linker technology used in the development of the ADCs.

“We look forward to establishing in the correct forum that Seattle Genetics is entitled under the parties’ collaboration agreement to the intellectual property rights at issue,” Seattle Genetics said in its statement.