A Medical Device Daily

Given Imaging (Yokneam, Israel) and Olympus (Tokyo) reported that have signed a term sheet to settle their lengthy patent lawsuit in U.S. over their capsule endoscopy products.

The technology enables a patient to swallow a pill with an integrated camera, which makes its way through the gastrointestinal tract and captures images that a doctor can assess on a screen.

The term sheet includes certain worldwide cross-licenses under which each party receives a royalty-free license under all existing patents of the other party for its respective existing capsule endoscopy products.

The parties also exchanged covenants not to sue on currently available medical device products and agreed to a release of all past causes of action.

The term sheet also includes a cross-license under existing and future patents of each party for future capsule endoscopy products, which may include the payment of royalties by either party at a rate to be determined through an agreed upon mechanism.

Finally, the term sheet includes a payment to Given Imaging of $2.33 million and an agreement to cooperate in future mutually beneficial joint market-development projects.