Daiichi Sankyo has emerged victorious in appeals court, flipping a prior multimillion-dollar patent verdict on its head and seemingly checking off the final box in its long-running legal fight with Pfizer’s Seagen unit.
This week, the U.S. Court of Appeals for the Federal Circuit reversed a prior decision from a federal court in Texas that upheld the validity of Seagen's so-called '039 patent, which covers certain peptides conjugated to an antibody through various linkers.
In turn, a prior judgment of infringement against Daiichi, plus damages and ongoing royalty requirements that the Japanese drugmaker previously had to pay Seagen on the antibody-drug conjugate (ADC) Enhertu, have been nullified.
Daiichi and Seagen have been trading barbs in court for years now over Seagen's so-called '039 patent. The two ADC specialists had collaborated under a 2008 agreement that ended in 2015, after which Daiichi joined forces with AstraZeneca to work on the ADC that became the oncology blockbuster Enhertu.
For its part, Seagen turned on its former partner in a 2020 Texas lawsuit accusing Daiichi of violating the ‘039 patent with Enhertu. From there, the case—which AstraZeneca eventually intervened in as well—has delved into the nitty-gritty nuances of patent law, concerning filing dates, written descriptions and public disclosures.
As the federal appeals court explained in its opinion (PDF) this week, the ‘039 patent was filed in 2019 as a continuing application of a patent initially filed in 2004. Daiichi originally invented the ADC that would become Enhertu in 2011, but its structure and mechanism of action were not made public until 2015.
Over a four-day-long trial in 2022, during which the specific description of the 2004 patent took center stage, it only took a jury two hours to conclude that Daiichi had willfully infringed on the ‘039 patent and owed Seagen $41.8 million in upfront Enhertu royalty revenue, plus an 8% running royalty.
The Enhertu maker quickly moved to appeal, arguing that Seagen’s patent claims were not supported by a written description. Daiichi also took issue with the 8% royalty rate included in the verdict.
The U.S. Court of Appeals for the Federal Circuit has now agreed with Daiichi, determining that “substantial evidence does not support the jury’s finding of adequate written description.”
“We have considered Seagen’s remaining arguments and find them unpersuasive,” Circuit Judge Alan Lourie concluded in the court’s opinion. “The ’039 patent is therefore invalid. We vacate the jury’s finding of willful infringement and assessment of damages.”
Another twist in the legal battle came in separate proceedings in 2024, when the U.S. Patent and Trademark Office (PTO) stepped in to wipe all claims of the ’039 patent. The official decision in that case found the claims staked in the ongoing litigation “unpatentable,” citing the same rationale that Daiichi argued. Seagen took that matter up with the appeals court as well.
The court again sided with Daiichi on the issue this week, dismissing Seagen’s appeal in the PTO matter as moot, Daiichi explained in a Dec. 3 release.
Daiichi is “pleased that the infringement judgment and damages award have been nullified,” the company’s general counsel Naoto Tsukaguchi said in a statement Wednesday.
Pfizer did not immediately respond to Fierce Pharma’s request for comment.
Pfizer took Seagen under its wing through a $43 billion acquisition in 2023, giving the Big Pharma “the goose that laid the golden eggs,” CEO Albert Bourla said at the time, referring to Seagen’s popular ADCs Adcetris, Padcev, Tivdak and Tukysa.
Meanwhile, in 2024, combined sales of Enhertu by AZ and Daiichi reached $3.75 billion, versus $2.57 billion the prior year.