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Amgen to Compensate Johnson & Johnson

April 16, 1998|Bloomberg News

Johnson & Johnson said Amgen Inc. will pay it $205 million to compensate for Amgen sales of an anemia drug for uses reserved to Johnson & Johnson in a licensing agreement. The arbitration ends an eight-year dispute stemming from a 1985 agreement that limits Amgen's U.S. sales of its Epogen drug to use for kidney dialysis patients. However, the arbitration order also requires Johnson & Johnson to pay Amgen's legal costs, totaling as much as $100 million. Johnson & Johnson and Amgen each sell their own version of the drug. Johnson & Johnson sells it as Procit in the U.S. for non-dialysis uses. The $205-million payment is for Amgen sales for uses other than kidney dialysis from 1991 to 1994. The arbitrator's decision is seen as a legal victory for Amgen. With $1.16 billion in Epogen sales, the drug generated about half of Thousand Oaks-based Amgen's $2.4 billion in 1997 revenue. For Johnson & Johnson, based in New Brunswick, N.J., Procit sales made up about $1 billion of its $7.7 billion in 1997 drug sales. Amgen shares fell 6 cents to close at $57.94 on Nasdaq, while Johnson & Johnson shares fell $1 to close at $71.56 on the New York Stock Exchange.

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