Two of the nation's largest biotechnology companies, Genentech Inc. and Chiron Corp., are locked in a dispute over rights to one of Genentech's most successful products, the breast cancer drug Herceptin.
Chiron is suing Genentech in federal court, claiming it holds a critical patent on the technology behind Herceptin. The stakes are huge. Chiron is asking for as much as 30% of Herceptin sales until its patent expires in 2005. That could total more than $300 million.
The trial, which began Aug. 6 in Sacramento, is expected to go to the 10-member jury this week. If the jury finds that South San Francisco-based Genentech willfully violated Emeryville, Calif.-based Chiron's patent, it can triple damages.
The case underscores the importance of patents in the biotechnology industry. San Diego patent lawyer James McClain said biotech companies often depend on one or two drugs that take many years and millions of dollars to develop. Patents give biotech companies a monopoly that protects such enormous investments.
Given the stakes, companies often choose to battle in court rather than agree to share intellectual property rights, he said.
"No side can afford to lose valuable rights to an invention," McClain said.
For Genentech, the suit is the second in as many months to question the company's business tactics.
Genentech is appealing a $500-million judgment against it by a jury that found it cheated City of Hope National Medical Center in Duarte out of royalties. That verdict was reached in June.
The dispute between Genentech and Chiron is rooted in a scientific race during the 1980s to discover the molecular cause of breast cancer. In 1984, David B. Ring and Arthur F. Frankel, then scientists at Cetus Corp., developed a mouse antibody that targeted a protein associated with human breast cancer. Chiron acquired Cetus in 1991.
Chiron did not develop a drug based on the development. But it diligently pursued a patent for it. The patent was issued in 2000.
U.S. District Judge William B. Shubb ruled in pretrial proceedings that Genentech infringed Chiron's patent. Jurors must decide whether Chiron's patent is valid.
Genentech claims that the Chiron patent is invalid because the discovery it covers is not useful or well described, two important tests. Chiron's mouse antibody, if used in people, would be destroyed by the immune system as a foreign invader before it could attack cancer cells, Genentech said.
