Judge nixes Merck’s $200M hep C patent win, citing ‘fabricated’ testimony, ‘pervasive’ misconduct

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Merck & Co. won’t collect the $200 million it won in a hepatitis C patent fight against Gilead Sciences after all. And according to a federal judge, that’s Merck’s own fault–and crucially, the fault of one of its expert witnesses.

Judge Beth Labson Freeman found “a pervasive pattern of misconduct” by Merck ($MRK) in the patent fight, according to a Monday ruling. A retired Merck scientist and lawyer “intentionally fabricated testimony” about early discoveries that led to the development of next-generation hepatitis C drugs, including Gilead’s blockbuster duo, Harvoni and Sovaldi, the ruling states. And Merck supported the “bad faith conduct,” the judge said.

A trial jury had awarded Merck $200 million back in March, after hearing evidence about R&D at Pharmasset, the drug developer Gilead ($GILD) bought in 2011 for its hep C meds. The judge reopened the case last month when Gilead served up evidence of potential misconduct on Merck’s part.

Merck says it plans to appeal. Labson Freeman’s ruling “does not reflect the facts of the case,” the drugmaker said in an emailed statement.