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Pharmaceutical industry

Regeneron Pharmaceuticals Settles Patent Dispute with Roche's Genentech Unit Over Eye Drug Eylea

Strategic Insights

— 1 min read

Regeneron Pharmaceuticals, Inc. has settled its patent dispute with Genentech Inc., a unit of Swiss drug maker Roche Group, relating to U.S. ophthalmic sales of its injectable eye drug Eylea or aflibercept. The settlement grants Regeneron a non-exclusive license to certain patents relating to VEGF receptor proteins and other technology patents. The agreement requires Regeneron to make payments to Genentech based on U.S. sales of Eylea through May 7, 2016, and to pay royalties on future sales.

Key Takeaways:

  • Regeneron will make payments to Genentech based on U.S. sales of Eylea through May 7, 2016.
  • The company will pay $60 million to Genentech when cumulative U.S. sales of Eylea reach $400 million.
  • Regeneron will pay royalties of 4.75 percent on cumulative U.S sales of Eylea between $400 million and $3 billion, and royalties of 5.5 percent when cumulative U.S. sales of Eylea exceed $3 billion.
  • Regeneron's patent litigation with Genentech will continue with respect to matters not covered by the deal.
  • Eylea is a new treatment option for patients with neovascular wet age-related macular degeneration (AMD) with less frequent injections reducing the need for monthly office visits.
  • Wet AMD is one of the leading causes of blindness for people over the age of 65 in the U.S. and Europe, and is worth more than $3 billion.
  • Regeneron's Eylea was approved by the FDA for the treatment of patients with neovascular wet AMD in November, while Roche's Lucentis is widely used to treat the condition but has a monthly treatment cost of around $24,000 per year.

Statistics:

  • Regeneron will pay $60 million to Genentech when cumulative U.S. sales of Eylea reach $400 million.
  • Regeneron will pay royalties of 4.75 percent on cumulative U.S sales of Eylea between $400 million and $3 billion, and royalties of 5.5 percent when cumulative U.S. sales of Eylea exceed $3 billion.
  • Roche's Lucentis generated sales of 1.13 billion Swiss francs for the first nine months of 2011, up 26 percent from the previous year.
  • The blockbuster market for wet AMD is worth more than $3 billion.
  • Regeneron's Eylea was approved for a priority review by the FDA in June, and was approved in November for the treatment of patients with neovascular wet AMD.

Sources:

  • Regeneron Pharmaceuticals, Inc.
  • Genentech Inc.
  • Swiss drug maker Roche Group
  • U.S. Food and Drug Administration
  • RTT News

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