U.S.: Gilead spars with Merck over hepatitis C $1,000-a-pill royalties

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Gilead Sciences, which pioneered a cure for hepatitis C, is trying to fend off a demand by Merck for more than $3 billion in a patent dispute over the liver disease treatment.

A compound in Gilead’s blockbuster drugs Sovaldi and Harvoni was found by a judge last month to have infringed Merck’s patents. Now, a jury must decide whether those patents are still valid, and if so, how much Gilead owes Merck in royalties.

Gilead plans to show jurors that scientists were working on the foundation for its medicine at least as early as 2001, a year before Merck got the patent rights that it’s seeking to enforce in the case, Juanita Brooks, a lawyer for the world’s largest biotechnology firm, said Monday during opening arguments at a trial in federal court in San Jose. She said Gilead owes the success of its drug not to Merck but to laboratory research done 15 years ago by Pharmasset, which Gilead acquired in 2011 for $11 billion.

“It’s clear whose invention this is,” Brooks told the jury. “It’s clear this is Pharmasset’s invention and Gilead’s acquisition. So why are we here?”

Merck’s lawyer countered that the key invention at issue derived from work by his Kenilworth, New Jersey-based client “before it was ever even a figment of the imagination at Pharmasset.” Merck alleges that immediately after the company published its patent in 2002, Pharmasset used it to develop what would later become the compound sofosbuvir.

“Gilead wants you to think Merck’s patents are based on Pharmasset’s inventions, but that’s just not true,” attorney Bruce Genderson said in his opening statement. “They were based on Merck’s own work over years.”

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