By Lisa Seachrist
In what is only the beginning of an anticipated lengthy trial process, Amgen Inc. and Transkaryotic Therapies Inc. (TKT) offered opening statements in a trial in which Amgen alleges TKT infringed upon its erythropoietin (EPO) patents.
The trial began Monday in Boston and will last a total of 20 days; however, the trial will be interrupted by other matters on the presiding judge's calendar. Each company will have 10 days to prove its case.
"The judge was quite clear that the trial would last 20 days and each company has 10 days," said Elise Wang, first vice president at PaineWebber Inc. in New York. "We expect the trial to go well into June."
Thousand Oaks, Calif.-based Amgen filed a patent infringement case against TKT, of Cambridge, Mass., and Hoechst Marion Roussel AG (HMR), of Frankfurt, Germany, in April 1997. The suit sought an injunction to prevent the defendants from making, importing, using or selling EPO in the U.S. The case was stayed until TKT and HMR (now Aventis Pharma AG) lost the protection of a clinical trial exemption in June 1999. (See BioWorld Today, June 10, 1999, p. 1.)
EPO, which is marketed by Amgen under the name Epogen, is a glycoprotein hormone that regulates the level of red blood cells in circulation by stimulating their production in the bone marrow. It was introduced for patients with anemia who are on kidney dialysis. Amgen claims TKT's gene-activated EPO infringes on patents the company has covering EPO.
TKT claims those patents don't apply because TKT technology uses a normal human cell with a normal EPO gene present and turns on the gene, creating a naturally occurring form of EPO. By circumventing the conventional genetic engineering approach, TKT and Aventis claim they aren't infringing on Amgen's patents.
In April, Chief Judge William Young of the U.S. District Court of Massachusetts in Boston disagreed by granting Amgen a motion of summary judgment of patent infringement for a single claim on a pharmaceutical composition patent for EPO. (See BioWorld Today, April 27, 2000, p. 1.)
In Monday's opening statement, Amgen focused on the fact that it had a product patent. TKT's strategy as outlined during the first day is to claim Amgen's patent is invalid, doesn't enable the TKT method of producing EPO and the patent was obtained by inequitable conduct. In other words, Amgen either failed to inform the patent office of prior art or intentionally misled the patent office when filing its patent application.
"I generally think the odds favor Amgen," Wang said. "With the summary judgment, the burden has really shifted to TKT. They now have a much higher standard to reach."
However, in making the summary judgment, the judge indicated the Amgen patent may be too broad, said Thomas Dietz, managing director of research at Pacific Growth Equities Inc. in San Francisco.
"I honestly think when we look at this, TKT has a different EPO," Dietz said.
Eric Schmidt, vice president at SG Cowen Securities Corp. in New York, said it is very difficult to say which company will win even though he thinks TKT probably has the better case.
"We continue to believe as a firm that TKT will prevail," Schmidt said. "The take-home message should be not to get too excited either way through the course of this court trial. The stakes are so high that whoever the loser is will appeal."
Both Wang and Dietz concur with Schmidt's contention that the current trial is unlikely to conclusively decide the case. "We certainly think this will reach the appellate court," said Dietz.
At the end of the current trial, the judge could reach a bench judgment and announce the victor in court. It's more likely, however, he will choose to write an opinion that is likely to be available in July or August. All of the analysts indicated the final appellate ruling isn't likely until the second half of next year.
Amgen's stock (NASDAQ:AMGN) closed Monday at $64.187, up $1.812. TKT's stock (NASDAQ:TKTX) closed at $27.062 up 81.25 cents.