Gilead Ends Patent Dispute With Roche Over Tamiflu

The US biopharmaceutical company Gilead Sciences has ended its dispute with the Swiss pharmaceutical company Roche regarding the right to the anti-influenza drug, Tamiflu (oseltamivir) “in the interest of working together to address public health needs,” Gilead announced today. Tamiflu is widely sought for use against the potential spread of avian influenza in humans.

The expanded collaboration means that Gilead will become more involved in manufacturing — including the consideration of third party licenses for manufacturing – commercial and pandemic planning for Tamiflu through joint committees overseeing the procedures, according to press releases from Gilead and Roche.

Gilead receives royalties on sales of Tamilu from Roche. Under the agreement, Roche will pay Gilead $62.5 million in retroactive royalty adjustments.

Gilead will also be able to co-promote Tamiflu in specialised areas in the United States but will not use this option next year but possibly from 2007, it says.

Tamiflu is believed to be the best medicine in case of an outbreak of avian influenza and Roche, which has been marketing the drug, had been under increasing pressure lately to enter licensing agreements for co-production to meet demands. The dispute about the patent rights between Roche and Gilead has been looming in the background of this licencing debate (IPW, Public Health, 20 October).

Gilead developed Tamiflu in its California research labs and entered into a development and licence agreement with Roche in 1996 under which Roche was granted worldwide commercialisation rights for Tamiflu, a spokesperson said in an interview (IPW, Public Health, 10 November).

Starting in 1996, the two companies collaborated on the development of Tamiflu, for which clinical trials started in 1997 with its first market approval two and a half year later.

On 23 June, Gilead issued a notice of termination of the 1996 agreement with Roche, the spokesperson said. But as the two companies did not resolve the dispute within the period specified by their agreement, Gilead “submitted the matter for confidential binding arbitration,” which had to be completed within 18 months.

“With today’s announcement, we have terminated the arbitration process,” the spokesperson said in an email. Gilead indicated in its press release that the settlement was related to the “growing incidence of avian influenza.”

Roche’s earnings from Tamiflu grew by 263 percent during the first nine months this year compared with the same period in 2005, according to the Economist.