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Chiron Vows to Continue Fight With Genentech

By Brenda SandburgRECORDER STAFF WRITER

After being handed a defeat Friday bya federal jury, Emeryville, Calif.-based Chiron Corp. said it plans to

resurrect a strategy it had identified earlier inthe trial to prove the validity of its patent. After 1 1/2 days of deliberations, theSacramento, Calif., jury concluded thatChiron did not invent the technologyunderlying Genentech's Herceptin breastcancer drug, freeing Genentech from havingto fork over more than $300 million inroyalties. Herceptin is one of Genentech'stop-selling products, generating sales ofnearly $1 billion since it came on the marketin 1998.

"This is a case where Chiron tried torewrite history, and they got caught," saidGenentech attorney Henry Bunsow, a partnerat San Francisco's Keker & Van Nest. "Ittried to take patent claims written in 1984,1985 and 1986 and turn them into cutting-edge technology which they were neverintended to cover."

But Chiron says the battle is far from over. "Chiron continues to believe that its patent

covering the anti-HER2 monoclonalantibodies is valid," the company said in astatement. "The evidence clearly showedthat Chiron was the first to invent these

antibodies. Chiron intends to pursuemultiple courses of action to overturn theverdict, including an appeal should that benecessary."

Robert Blackburn, Chiron's chief patentcounsel, said the company plans to refile amotion it had pending before the trial. Themotion requested a ruling that the evidenceSouth San Francisco, Calif.-basedGenentech had put forward couldn't supporta jury verdict.

"The judge will decide whether to acceptthe jury verdict or set it aside," Blackburnsaid.

John Keker, a partner at Keker & Van Nestwho led Genentech's trial team, said thepatent infringement case was fairly unusualin that Chiron "waited 16 years to writeclaims that cover intervening technology."

"Lawyering on the other side really madeup for a lot of deficiencies in the patent andallowed it to get as far as it did," Bunsowadded. "This was a lawyer-made patent ... Itdidn't have its genesis in any Chironlaboratory."

In 1984, Chiron filed an initial applicationon the patent, which covers monoclonalantibodies that bind to a human breast cancerantigen known as HER2. The company filedcontinuance applications to the U.S. Patentand Trademark Office to revise the claims in1985, 1986 and 1995 and was issued the

patent in 2000. An interesting twist occurred in the middle

of the three-week trial when the patent officeagreed to review whether Chiron is thelegitimate owner of a patent related to theone disputed in the trial. U.S. District CourtJudge William Shubb, of the Eastern Districtof California, ruled that neither side couldrefer to this related patent, covering the so-called "Drebin/Greene" antibodies. And hetold the jury to disregard comments aboutthe antibodies that were made by Chironattorney Harold McElhinny, a partner at SanFrancisco-based Morrison & Foerster, in hisopening statements.

While Chiron plans to fight the juryverdict in this case, it's also gearing up forseparate litigation against Genentechinvolving another patent issued in 1988. Atrial over that patent is set for next yearbefore Shubb.

Genentech's win in the current case maybe particularly sweet given its recent loss inanother high-profile suit. A Los AngelesCounty Superior Court jury awarded the Cityof Hope National Medical Center $300.1million in compensatory damages and $200million in punitive damages againstGenentech for breach of a 1976 contract andfailing to pay royalties on human insulin andhuman growth hormone.

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