Columbia patents under attack

Five large biotech and pharmaceutical companies are accusing Columbia University of having illegally extended the life of key DNA patents to maintain highly lucrative licensing revenues. The patents have brought the university between $300 and $400 million in licensing royalties over the past 2 decades. In lawsuits filed last week, the companies say that Columbia's so-called Axel patents, which cover the cotransformation process, have expired. The technology, they say, should now be in the public domain and Columbia should no longer be allowed to assess royalties for its use. In cotransformation, foreign DNA is inserted into a host cell to produce certain proteins. As a pioneering recombinant DNA technology, it is widely used by pharmaceutical and biotech companies. The technology was a top revenue producer for Columbia, bringing in almost $100 million a year at its peak. The Axel patents expired 3 years ago, but the university last year obtained a new patent, which, it maintains, covers the same technology.And that is the crux of the legal issue. Last week, Biogen, Genzyme, and Abbott Bioresearch Center jointly filed civil suit in the US District Court in Boston. They claim the university "misled" the US Patent and Trademark Office (PTO) into issuing a new patent in September 2002 that is essentially the same as the old patents that expired in August 2000. Columbia is requiring the companies to continue paying royalties under the new patent, which extends to 2019. The lawsuit is similar to ones separately filed against Columbia earlier this year on the West Coast by Amgen and Genentech. "Columbia obtained its patent protection, reaped very significant rewards, and now the inventions have passed into the public domain," said Donald R. Ware, lead counsel for the three companies in the Boston case. "The industry wants Columbia to play by the rules that everybody else plays by, which is you have an invention, you get a patent, and you get one 17-year term," said Ware, an attorney with the law firm of Foley Hoag LLP in Boston.Columbia University disagrees. "The US patent office has determined that the most recent patent application … includes distinct and different inventions," said Robert Kasdin, a senior executive vice president at Columbia. "We believe that the US Patent and Trademark Office has come to the correct conclusion, and their conclusion should be respected." Kathleen Madden Williams, who holds a PhD in molecular biology and is cochair of patent and biomedical practices with the law firm of Palmer & Dodge in Boston, sides with the biotech companies. The newest Columbia patent "is so similar to what was patented previously in one or more of the three previous patents that they're improperly attempting to extend the patent coverage beyond the allowable term," she said. "I do think it's the same invention, which is really the issue at hand." Williams is not involved in the litigation.At the root of the controversy are discoveries made during the late 1970s by renowned Columbia biochemist Richard Axel, microbiologist Saul J. Silverstein, and geneticist Michael H. Wigler. Described by Columbia as its "single most successful innovation," the Axel patents cover the process of altering the genotype of a eukaryotic host or recipient cell by inserting a gene that codes for a desired protein and a gene that codes for a selectable marker. The research received funding from the National Institutes of Health (NIH). The original Axel patent was filed in February 1980 and was issued in August 1983. Two other related patents were issued in 1983 and 1987 based on the original research. The PTO granted those additional patents only after Columbia filed a "terminal disclaimer" that limited the term of the new patents to that of the original patent, Ware said. As a result, all three patents expired in August 2000. The newest patent, filed in 1995 and issued September 2002, did not disclose Columbia's previous patents or its file history to the patent examiner, the lawsuit contends. As a result, the suit claims, Columbia deliberately "misled" PTO about the scope of its earlier cotransformation patents and engaged in an improper "submarine patenting strategy."Kasdin denies it. "Their claims are wholly without merit, and we are confident that the courts will uphold the decision of the US patent office," he said.Over the past 2 decades, Columbia has licensed the Axel technology to more than 30 biotech and pharmaceutical companies, reaping hundreds of millions in revenues. The companies, in turn, have used the technology to develop and commercialize a wide range of drugs, some of which have become best sellers. According to the lawsuits, Biogen paid Columbia more than $35 million to develop and market its blockbuster drug Avonex for multiple sclerosis. Genzyme paid nearly $25 million for Cerezyme, an enzyme replacement treatment for type 1 Gaucher disease. Genentech paid more than $70 million to produce and sell its blood-clot–busting drug Activase. "The industry understood in 2000 the patents had expired and they would no longer be burdened with that royalty expense in future years," Ware said. In early 2000, just months before the patents were due to expire, Columbia took the unusual step of seeking help from Congress. With the university's blessing, Sen. Judd Gregg (R-NH), a Columbia alumnus, made unsuccessful attempts to amend unrelated appropriations bills with a measure that would extend the Axel patents for an additional 15 months. If successful, the extension would likely have generated an additional $100 million for the university.Gregg argued that the Hatch-Waxman Act, which extends patent terms for pharmaceuticals when the drug approval process is delayed by the FDA, should also apply to the Axel patents. Other legislators and industry representatives expressed outrage, however, and the measure did not pass. Because the Axel research received federal funding prior to 1980, it did not automatically trigger provisions of the Bayh-Dole Act, which allows universities to take title to inventions made with federal funds. But NIH and Columbia entered into a separate agreement that gave the university rights to the discoveries as long as subsequent licenses "include adequate safeguards against unreasonable royalties and repressive practices. Royalties shall not in any event be in excess of normal trade practice," the lawsuit quoted the agreement as specifying. "We would say that charging royalties for patent terms that extend more than 17 years beyond the expiration of the earlier patents is not reasonable," Ware said.Columbia's response to the Boston lawsuit is due in early August.

Columbia patents under attack

Latest lawsuits allege the university misled patent office to extend cotransformation revenue

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