The trial between Genentech Inc. and Biogen MA Inc. officially opened Monday in the U.S. District Court for the Northern District of California, centering on a $122 million royalties dispute related to Biogen’s multiple sclerosis drug, Tysabri.
Genentech, a subsidiary of Roche Holding AG, alleges that Biogen owes $122 million in unpaid royalties for Tysabri supplies manufactured before the expiration of Genentech’s patent in December 2018. The breach of contract suit, filed in 2023, arises from a licensing agreement between the two companies that dates back to 2004.
According to Genentech’s counsel, Paul Gaffney of Williams & Connolly LLP, Biogen continued to sell large inventories of Tysabri after the patent expired while collecting revenues without paying royalties. “Genentech believes it is owed $122 million and is asking the court to make Biogen honor its contractual obligations,” Gaffney said during opening statements.
Biogen, represented by Martin Black of Dechert LLP, contends that the licensing agreement does not require royalties on sales made after the patent’s expiration. Black emphasized that Biogen has paid over $750 million in royalties over the past 12 years and that the agreement’s terms ended with the patent expiration on December 18, 2018.
The licensing deal involves patents covering manufacturing technology for antibodies used in Tysabri, Biogen’s multiple sclerosis treatment that generated $2 billion in annual sales by 2018. The key legal question focuses on whether royalties are owed on sales of inventory manufactured before the patent expired but sold afterwards.
The trial is expected to last three days before proceeding to the jury. U.S. District Judge Yvonne Gonzalez Rogers advised counsel to avoid discussing the total monetary value of the dispute, noting the jury’s diverse economic backgrounds.
The case is officially captioned Genentech Inc. v. Biogen MA Inc., case number 4:23-cv-00909.
