ImClone's defense of patent exhaustion eliminated in court ruling

By Elaine Rigoli

Tampa, Fla., July 31 - The U.S District Court for the District of Massachusetts has issued a summary judgment rejecting ImClone Systems, Inc.'s defense of patent exhaustion in the ongoing patent infringement lawsuit with Repligen Corp. and The Massachusetts Institute of Technology (MIT).

In their complaint, Repligen and MIT allege that ImClone's production of Erbitux infringes U.S. patent 4,663,281, which covers certain genetic elements that increase protein production in a mammalian cell. This patent is assigned to MIT and exclusively licensed to Repligen.

ImClone has previously reported that it produced about $1 billion worth of Erbitux prior to the expiration of the patent-in-suit in 2004 and that Bristol-Myers Squibb, ImClone's commercial partner, has paid ImClone $900 million in up-front and milestone payments as well as a 39% royalty on the net sales of Erbitux in the United States.

Repligen and MIT allege that the cell line that ImClone uses to produce Erbitux employs key technology that is claimed in the patent-in-suit. Repligen and MIT also allege that the cell line was created under contract for the National Cancer Institute by a predecessor to Repligen and subsequently transferred to ImClone for use in research and development only.

In its ruling, the court found that neither the transfer to the National Cancer Institute by Repligen's predecessor nor the subsequent transfer to ImClone by the National Cancer Institute exhausted the proprietary rights of Repligen and MIT.

The court's ruling has eliminated these arguments as a potential defense for ImClone at trial.

The case will now proceed to trial on the merits of ImClone's other defenses, and ImClone said it will defend its position that it does not infringe the subject patent.

Repligen is a biopharmaceutical company with headquarters in Waltham, Mass.

ImClone is a biopharmaceutical company with headquarters in New York.

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