A Medical Device Daily

Codon Devices (Cambridge, Massachusetts), a maker of synthetic genetic materials, last week reported filing suit against Blue Heron Biotechnology (Bothell, Washington) in U.S. District Court in Delaware, alleging that Blue Heron's Genemaker gene synthesis platform infringes five of Codon's U.S. patents.

Codon's lawsuit seeks unspecified monetary damages, and it has asked the court to mandate Blue Heron to cease infringement. Codon says that the patents, which cover DNA error correction, are exclusively licensed to it.

On Friday, Blue Heron issued a statement saying that it had "performed and initial assessment of Codon's claims and believes that there is no basis in fact for the allegations . . ."

John Mulligan, Blue Heron's founder and CEO said, "In its eight years of operation, Blue Heron has always maintained the highest levels of integrity in matters of intellectual property development and application, and we are confident that Codon's action will be shown to be without merit. Blue Heron intends to vigorously defend against these baseless claims of patent infringement."

Blue Heron said it expects no material impact on its current and future business or on its customers.

Codon manufactures products such as gene libraries and synthetic cells for customers in the pharmaceutical, agriculture, chemical, and energy industries.

In other legalities:

The Federal Trade Commission reported that a company named My Free Medicine and its principal "lured low income consumers with no insurance into spending $199 by making alleged deceptive claims that they would receive free prescription medications.

It said that the company has agreed to settle the charges. The settlement bars My Free Medicine and its principal from accepting payment without first providing a clear and conspicuous written notice that discloses the terms and conditions of their services.

The settlement also contains a $500,000 judgment, suspended based on the defendants' inability to pay. Should the court find that the defendants misrepresented their financial condition, the entire $500,000 will become immediately due and payable, the FTC said.

In September 2005, the FTC charged that the defendants targeted low income consumers who spent more than $100 a month for medications and who might qualify to receive free prescription medicine through one or more of the many patient assistance programs (PAPs) operated by drug companies. The PAPs impose varying eligibility requirements on consumers and not all drugs are available through these programs.

Those that are may only be available for limited times, or in certain doses.

The complaint alleges that defendants used radio and TV ads to urge consumers who were not covered by insurance to call a toll-free number to find out if they were "eligible" to receive free prescription medications. Defendants' sales reps routinely told consumers that they were eligible to receive free prescription medication and that their medications were available through their program. The sales reps also told consumers that the company dealt directly with pharmaceutical companies and the federal government to obtain free prescription medications for consumers, and that the company would provide the medication directly to the consumers or to their doctors.

In fact, the company simply provided consumers with PAP application forms that had to be submitted to the companies. After paying $199.95 for a six-month enrollment in defendants' program, many consumers learned that they were not eligible to receive medications for free from a PAP, or that their prescriptions were not available from a PAP.

A U. S. District Court in Seattle, Washington, ordered a halt to the deceptive claims, and froze the defendants' assets, pending trial. The settlement announced today resolves that litigation. The settlement also requires that defendants disclose, in writing, the terms and conditions of their refund policy.