A Medical Device Daily

Edwards Lifesciences (Irvine, California) reported that it has entered into an agreement with Medtronic (Minneapolis) and Medtronic Vascular (Santa Rosa, California), resolving patent infringement litigation initiated in August 2003 by Edwards and Endogad Research (Sydney, Australia), the company formed by the clinician-inventors of the patents at issue.

The alleged infringement was of certain patents related to modular or multi-part endovascular grafts especially suited for treatment of various types of aneurysms, including abdominal aortic aneurysms (AAA).

In exchange for a cash payment of $37.5 million to Edwards and Endogad, Medtronic has been granted non-exclusive licenses to the patents involved in the litigation, as well as to other patents relating to endovascular AAA grafts and delivery systems.

Medtronic also has purchased delivery system assets to be used with AAA grafts. Edwards said it expects to record a special pre-tax gain in 1Q06 of about $20 million, after taking into account its agreement with Endogad and legal expenses.

Stuart Foster, Edwards' corporate vice president, technology and discovery, said, “This resolution protects the interests of Edwards and our clinician-inventor partners, with whom we work to create new technologies for the treatment of advanced cardiovascular disease.“

Edwards and Endogad remain in litigation with Cook (Bloomington, Indiana) and W.L. Gore & Associates (Flagstaff, Arizona) regarding infringement of the patents that are owned by Endogad and exclusively licensed to Edwards. The products named in the original suit include Medtronic's AneuRx Stent Graft and Talent Stent Graft Systems, Cook's Zenith Endovascular Graft and Gore's Excluder Bifurcated Endoprothesis.

Edwards' global brands, sold in about 100 countries, include Carpentier-Edwards, Cosgrove-Edwards, Fogarty, LifeStent, Perimount and Swan-Ganz.

In other legalities, Bay Materials (Menlo Park, Califor nia), a supplier to Align Technology (Santa Clara, California), has filed suit vs. Align, alleging fraud, negligent misrepresentation, breach of contract and violating its code of business ethics.

Bay Materials says that it invested “considerable resources and time over a period of several years“ to develop a proprietary product for Align for use in the production of Align's Invisalign invisible braces method, and that Align then reneged on its oral and written agreements to purchase the material from Bay.

Bay Materials' lawsuit says that after expending considerable R&D costs and maintaining a large inventory of the material, as required by their agreements, Align then refused delivery and payment of product and switched suppliers.

It alleges that Align also violated its own published code of business ethics and directly approached two of Bay Materials' subcontractors with the intent of excluding Bay Materials from providing the proprietary material to produce the invisible braces for Align.

Align Technology, which also has been engaged in a litigation with another company, OrthoClear (San Francisco), has seen its share value drop by nearly two-thirds from a high of $21 a share in January 2004. It closed at $7.59 a share on Jan. 20.

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