By Mary Welch

In a new legal salvo, Transkaryotic Therapies Inc. and Hoechst Marion Roussel Inc. filed a motion to reopen their Gene-Activated erythropoietin (GA-EPO) patent lawsuit against Amgen Inc., in U.S. District Court in Boston.

In addition, the two companies asked Kirin-Amgen Inc. to acknowledge that GA-EPO does not infringe on European patent No. 9148605B2. If Kirin-Amgen acknowledges non-infringement, the matter would end. If it doesn't, TKT and Hoechst may launch judicial proceedings in the U.K.

"We are confident of our patent position," said David Kaye, associate director of communications for Thousand Oaks, Calif.-based Amgen. "We've been expecting for some time that they would reopen the case."

Not surprisingly, Transkaryotic Therapies (TKT) also is confident. "Our actions reflect our confidence in our legal position," said Justine Koenigsberg, spokeswoman for the Cambridge, Mass.-based company. "We're not commenting any further because it is ongoing legislation, but we are very confident."

Thomas Dietz, senior managing director of Pacific-Growth Equities Inc., in San Francisco, cast his vote with TKT. "It is our opinion, as well as the opinion of our legal advisors, that TKT is in an extremely strong position to win," he said.

The dispute dates back to 1997, when Amgen filed a lawsuit seeking an injunction preventing TKT and Hoechst from making, importing, using or selling EPO in the U.S. In the suit, Amgen claimed TKT's EPO has the same structure and biological activity of EPO identified in its patents. The complaint stated that TKT's EPO product, like Amgen's, is not isolated from human urine and is not obtained from blood or other natural source and, as such, is non-naturally occurring. (See BioWorld Today, April 17, 1997, p. 1.)

Less than a year later, a federal judge rejected an attempt to dismiss the lawsuit. However, a judge in the U.S. District Court of Massachusetts, in Boston, ruled that the case will be stayed until TKT and Hoescht lose the protection of the clinical trial exemption, as provided for in the Waxman-Hatch Act. Either party had the option to reopen the case, which is what TKT and Hoescht now are doing. (See BioWorld Today, April 17, 1998, p. 1.)

TKT and HMR, of Frankfurt, Germany, developed a product known as GA-EPO, which is in Phase III trials to support approval for intravenous and subcutaneous administration. Using a process called Gene Activation Technology, TKT created an approach to the large-scale production of therapeutic proteins that does not require the cloning of genes and their subsequent insertion into non-human cell lines. The company's position has been that it avoids any patented approaches to the production of proteins that use conventional genetic engineering - like for Epogen - by activating genes in human cells to produce the protein instead of manufacturing them by introducing cloned human genes into bacterial, yeast or non-human mammalian cells.

The Phase III trials, both in the U.S. and U.K., should finish by year's end. The companies refused to speculate when a biologics license application (BLA) would be filed in either country.

The case has serious repercussions for all parties. Amgen's revenues have largely been fueled by Epogen (Epoetin alfa) since the drug was launched a decade ago for the treatment of anemia associated with chronic renal failure for people on dialysis. The company expects to hear from the FDA soon on whether Epogen is approved for use in children. Produced in hamster cells, Epogen is a recombinant protein that stimulates red blood cell production.

Last year, Epogen racked up sales of $1.38 billion, up from $1.16 billion in 1997, a 19 percent increase. For the first quarter of 1999, Epogen realized sales of $395 million, an increase of 30 percent over the first quarter of 1998.

"It's a very complicated case and I think some ignored Amgen as a stock because it was confusing," said Albert Rauch, senior vice president of Everen Securities Inc. in Chicago. "This has been hanging over Amgen's head. But one could logically argue that TKT is pretty confident of its position to instigate the trial.

"Epogen is a billion-dollar drug and Amgen has a monopoly in the field," Rauch continued. "If Amgen loses, it could be a substantial loss. Amgen has been the only player. Bring someone else in and the market could be split 50-50. If TKT tries to compete on price, Amgen may have to meet it, which would erode its profit margins. It could have a dramatic effect."

Dietz doesn't want to guess what market share Amgen might lose if TKT prevails. "But it could be a substantial revenue loss," he said.

Transkaryotic Therapies' stock (NASDAQ:TKTX) closed Wednesday at $33.25, up $2.25. Amgen's stock (NASDAQ:AMGN) closed at $57.75, down $1.50.