By Charles Craig

Baxter International Inc. and two co-plaintiffs, having won $2.3 million in damages for patent infringement by CellPro Inc., said Wednesday the next move will be to seek an injunction barring the small biotechnology company from selling its first FDA-approved product, which restores bone marrow destroyed by cancer chemotherapy.

The monetary damages were awarded late Tuesday by a U.S. District Court jury in Wilmington, Del., which also ruled CellPro's patent infringement was willful, paving the way for the judge to increase the payment to Baxter, of Deerfield, Ill., Johns Hopkins University, of Baltimore, and Becton Dickinson & Co., of Franklin Lakes, N.J.

CellPro's stock (NASDAQ:CPRO) slipped $1.625 Wednesday to $6.500.

The case involves a five-year patent fight between the three plaintiffs and CellPro, of Bothell, Wash.

In August 1995 a federal jury decided CellPro's Ceprate SC Stem Cell Concentration System, approved by the FDA in December 1996, did not infringe patents held by Johns Hopkins and licensed to Becton Dickinson and Baxter.

However, U.S. Judge Roderick McKelvie threw out that jury verdict and subsequently ruled CellPro did violate two Johns Hopkins patents related to a monoclonal antibody for selecting particular stem cells.

McKelvie impaneled a federal jury last week to decide the issue of damages and willfulness. The same judge also will hear the plaintiffs' motion for an injunction barring CellPro from continuing to sell the Ceprate SC Stem Cell Concentration System, which is the company's first marketed product.

Deborah Spak, spokesperson for Baxter, said the injunction against CellPro will be sought in the next couple of weeks. But she added Baxter wants to keep the technology available for cancer patients.

CellPro's product is the only FDA-approved device of its kind. Baxter's competing device, called Isolex 300 Magnetic Cell Separator System, is under review by the FDA.

CellPro's chief financial officer, Larry Culver, said his company will appeal McKelvie's patent infringement rulings, this week's jury verdicts and an injunction, if it is issued, against Ceprate device sales.

Culver said CellPro, armed with the 1995 jury verdict in its favor, is confident it will prevail on the appeals.

CellPro also has petitioned the U.S. Department of Heath and Human Services (HHS) to intervene in the case and grant the company a license to the Johns Hopkins technology under provisions of the Bayh-Dole Act, named for former U.S. Senators Birch Bayh (D-Ind.) and Robert Dole (R-Kan.).

The 1980 law gives the HHS secretary the authority, if public interest warrants, to issue licenses to technology developed with federal funds, even if patent rights already are held by another company.

Culver said CellPro is rallying doctor and patient support for the petition. A decision by the HHS would follow a "deliberative process," Culver said, in which the department would seek input from the plaintiffs in the patent litigation and conduct a fact-finding investigation before reaching a decision.

Culver is not aware of an instance in which an HHS secretary directly ordered a license to federally funded technology. However, petitions similar to CellPro's have been filed, he added, and HHS officials have been involved in licensing negotiations with the parties.

CellPro's Ceprate SC Stem Cell Concentration System isolates stem cells from the bone marrow of a cancer patient prior to chemotherapy. After the treatment, the purified stem cells are reinfused to reconstitute the patient's depleted bone marrow, which is responsible for replenishing blood and immune system cells of the body.

The procedure, CellPro officials have said, significantly reduces toxicities associated with traditional bone marrow transplants.

Baxter's stock (NYSE:BAX) closed Wednesday at $47.375, down $1.00. Beckton Dickinson (NYSE:BDX) ended the day at $47.75, down $0.875. *