Sun Pharma stock rises after US court verdict – Business Standard

Sun Pharma stock rises after US court verdictPress Trust Of India / Mumbai Apr 19, 2012, 00:49 IST

The stock of the country’s most-valued drug maker, Sun Pharmaceutical Industries, closed with over two per cent gain on bourses, after a favourable verdict from the US Supreme Court in its patent case against Novo Nordisk.

The US Supreme Court ruled in favour of the company’s subsidiary, Caraco Pharmaceutical Labora-tories, in its patent litigation against Novo Nordisk over Caraco’s generic version of prandin, repaglinide tablets, used for treating diabetes.

Shares in Sun Pharma surged 2.8 per cent to Rs 600.5, its 52-week high on the Bombay Stock Exchange. The stock finally closed 2.1 per cent up at Rs 596.6. A similar movement was witnessed on the National Stock Exchange, where the stock opened at Rs 588.05, surged to an intra-day high of Rs 601.5, and finally closed at Rs 598 — a gain of 2.27 per cent.

The market capitalisation of the company increased to Rs 61,775 crore from Rs 60,020 crore yesterday.

The market capitalisation of the company increased to Rs 61,775 crore from Rs 60,020 crore yesterday.

Prandin is a registered trademark of Denmark-based drug firm Novo Nordisk and has annual US sales of about $230 million.

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US Supreme Court to revisit “first-sale” copyright doctrine

The Supreme Court agreed Monday to decide the global reach of US copyright law, in a case testing whether an overseas purchaser of a copyrighted work may resell it in the United States without the copyright holder’s permission.

The justices will hear the case, which considers the “first-sale” doctrine, in its next term and is expected to set a nationwide standard. Federal circuit courts of appeal are split on the issue.

The first-sale doctrine generally allows the purchaser of any copyrighted work to re-sell or use the work in many ways without the copyright holder’s permission. That’s why used bookstores, libraries, GameStop, video rental stores, and even eBay are all legal. But how the doctrine applies to foreign-purchased works—the so-called grey market—has been a matter of considerable debate.

In many ways, this is a battle for non-digital goods. Most digital goods, like software, e-books and MP3s—because of licensing or sandboxing—cannot be resold. However, a US startup, ReDigi, is testing that theory when it comes to online music.

Meanwhile, the high court in 2010 said the first-sale doctrine did not apply to overseas purchases of copyrighted works which were imported for resale in the United States. The 4-4 ruling meant Costco could be liable for copyright infringement for selling foreign-made watches without the manufacturer’s authorization. However, because there was no majority decision, the ruling did not set a nationwide precedent and solely affirmed a lower court’s ruling.

Justice Elena Kagan was recused from the Costco case, as she had worked on it when she was solicitor general. She had urged the justices to side with Omega, the watchmaker. The government’s position was that the “Copyright Act does not apply outside the United States.” Costco had told the Supreme Court that the decision effectively urges US-based manufacturers to flee the United States (.pdf) to acquire complete control over distribution of their goods in the American market, arguments now being made in the latest case.

The case the justices decided to review Monday concerns textbook maker John Wiley & Sons and California entrepreneur Supap Kirtsaeng, who was reselling textbooks purchased overseas to US-based students without the publisher’s consent. The publisher sued, and a New York federal jury agreed with John Wiley & Sons’ position that the first-sale doctrine did not apply, and awarded $600,000 in damages for copyright infringement.

A federal appeals court upheld the judgement. (.pdf)

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Myriad gene patent ruling sent back to lower court

WASHINGTON (Reuters) – The U.S. Supreme Court on Monday set aside a ruling that said Myriad Genetics Inc could patent two genes linked to breast and ovarian cancers, and ordered further review by a lower court in light of a conflicting ruling in a similar case.

The Myriad case has been closely watched by the biotechnology industry, with some insiders suggesting that a ruling against gene patenting could have a devastating effect on future innovation.

That includes the fledgling field of personalized medicine, which depends on genetic tests, such as those developed by Myriad, to match patients with specific therapies.

The justices delayed any action on the ruling by the U.S. Court of Appeals for the Federal Circuit that Myriad has the right to patent two human genes, known as BRCA1 and BRCA2, that account for most inherited forms of breast and ovarian cancers.

The Supreme Court ruled last week in a separate case involving medical diagnostics that companies cannot patent observations about a natural phenomenon. On Monday, it asked the lower court to revisit the Myriad case to view how it may or may not relate to that decision.

The move is expected to delay a verdict in the Myriad case by as much as several years. In the case of the individual company, that may give it enough time to benefit from the use of its contested patents. Shares in Myriad rose over 3 percent.

“Our intellectual property consultant could potentially see a scenario where the case doesn’t move its way back to the Supreme Court for another 2 to 3 plus years, keeping the BRACAnalysis franchise safe from competition,” said Junaid Husain, a research analyst for Dougherty & Co.

Women who test positive using Myriad’s gene test, called BRACAnalysis, have an 82 percent higher risk of developing breast cancer and a 44 percent higher risk of ovarian cancer in their lifetimes. Such tests could help determine a future course of therapy.

The appeals court by a 2-1 vote had ruled the genes isolated by the company could be patented because Myriad is testing for distinctive chemical forms of the genes, and not as they appear naturally in the body. The dissenting judge said the genes could not be patented just because they were isolated from the body.

The patents granted to Myriad give the company the exclusive right to perform the genetic tests. The appeals court in its ruling in July also found that Myriad’s method for screening potential therapies can be patented.

The appeals court had overturned a ruling by a federal judge in New York that the genes could not be patented.

HOW BIG A HURDLE?

Michael Yee, biotech analyst for RBC Capital Markets, said the Supreme Court not taking up the case on Monday was positive for the biotechnology industry.

Yee said he believes the courts will ultimately uphold Myriad’s patents, but does not agree that a ruling against Myriad would upend the biotech industry, as some have suggested.

“Biotechs have patents and intellectual property for proteins, antibodies, chemical entities and other composition of matter patents that support development of drugs,” Yee said.

While biotechs will likely continue to develop lucrative medicines regardless of the case’s ultimate outcome, a decision against gene patenting could hurt small diagnostics companies that depend on exclusive rights to such tests for revenue and could slow advances in personalized medicine.

“We will likely begin to see more copycat diagnostic tests rather than innovative tests over the next few years,” according to a report by GlobalData, which compiles and analyzes industry data.

The initial lawsuit filed against Myriad in 2009 claimed the patents violated patent law, restricting scientific research and patients’ access to medical care. Some groups have protested that patenting human DNA is immoral and unethical and impedes genetic research.

The appeal to the Supreme Court was backed by a number of organizations representing healthcare professionals, including the American Medical Association, and other groups.

The appeal argued that the question of whether genes and the information they convey can be patented is of “paramount importance to the future of patent law, the advancement of medical science and patients’ health.”

Gregory Castanias, the attorney representing Myriad, told the Supreme Court that patents involving isolated DNA molecules have been issued for nearly 30 years, resulting in significant investment by biotechnology companies.

Castanias said the challenged patents at issue in the case were filed more than 16 years ago. He said the appeals court’s decision was correct and the “questions presented are unique to this case, factbound and unlikely to recur.”

The Supreme Court case is the Association for Molecular pathology v. Myriad Genetics, No. 11-725.

(Reporting By James Vicini; additional reporting by Bill Berkrot in New York; Editing by Gerald E. McCormick)

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High court throws out human gene patents

WASHINGTON (AP) — The Supreme Court on Monday threw out a lower court ruling allowing human genes to be patented, a topic of enormous interest to cancer researchers, patients and drug makers.

The court overturned patents belonging to Myriad Genetics Inc. of Salt Lake City on two genes linked to increased risk of breast and ovarian cancer.

Myriad’s BRACAnalysis test looks for mutations on the breast cancer predisposition gene, or BRCA. Those mutations are associated with much greater risks of breast and ovarian cancer.

The American Civil Liberties Union has been arguing that genes couldn’t be patented, a position taken by a district court judge but overturned on appeal.

The justices’ decision sends the case back down for a continuation of the battle between the scientists who believe that genes carrying the secrets of life should not be exploited for commercial gain and companies that argue that a patent is a reward for years of expensive research that moves science forward.

In 2010, a federal judge ruled that genes cannot be patented. U.S. District Judge Robert Sweet said he invalidated the patents because DNA’s existence in an isolated form does not alter the fundamental quality of DNA as it exists in the body nor the information it encodes.

But last year, a divided panel of the federal appeals court in Washington that handles patent cases reversed Sweet’s ruling. The appeals court said genes can be patented because the isolated DNA has a “markedly different chemical structure” from DNA within the body.

The Supreme Court threw out that decision, and sent the case back to the lower courts for rehearing. The high court said it sent the case back for rehearing because of its decision in another case last week saying that the laws of nature are unpatentable.

In that case, the court unanimously threw out patents on a Prometheus Laboratories, Inc., test that could help doctors set drug doses for autoimmune diseases like Crohn’s disease.

“The question before us is whether the claims do significantly more than simply describe these natural relations,” said Justice Stephen Breyer, who wrote the opinion in the Prometheus Laboratories case. “To put the matter more precisely, do the patent claims add enough to their statements of the correlations to allow the processes they describe to qualify as patent-eligible processes that apply natural law? We believe the answer to this question is no.”

The U.S. Patent and Trademark Office has been awarding patents on human genes for almost 30 years.

Testing for mutations in the so-called BRCA genes has been around for just over a decade. Women with a faulty gene have a three to seven times greater risk of developing breast cancer and a higher risk of ovarian cancer.

Men can also carry a BRCA mutation, raising their risk of prostate, pancreatic and other types of cancer. The mutations are most common in people of eastern European Jewish descent.

Myriad Genetics Inc. sells the only BRCA gene test.

The case is Association for Molecular Pathology v. Myriad Genetics, 11-725.

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Supreme court sets aside Myriad gene patent ruling

WASHINGTON (Reuters) – The Supreme Court set aside on Monday a ruling that Myriad Genetics Inc can patent two genes linked to breast and ovarian cancers, in a case closely watched by the biotechnology industry.

The justices set aside a ruling by the U.S. Court of Appeals for the Federal Circuit that Myriad has the right to patent two human genes, known as BRCA1 and BRCA2, that account for most inherited forms of breast and ovarian cancers, and sent the matter back for more proceedings.

The Supreme Court ordered the further proceedings at the lower court in view of the high court’s ruling last week in a case that raised similar issues and that held that companies cannot patent observations about a natural phenomenon.

Women who test positive using Myriad’s gene test, called BRACAnalysis, have an 82 percent higher risk of breast cancer and a 44 percent higher risk of ovarian cancer in their lifetimes.

The appeals court by a 2-1 vote ruled the genes isolated by the company can be patented because Myriad is testing for distinctive chemical forms of the genes, and not as they appear naturally in the body.

The dissenting judge said the genes could not be patented just because they were isolated from the body.

The appeals court overturned a ruling by a federal judge in New York that the genes could not be patented, a decision that caused widespread concern for the biotechnology industry. It said such patents were essential to foster innovation.

The patents granted to Myriad give the company the exclusive right to perform the genetic tests. The appeals court in its ruling in July also found that Myriad’s method for screening potential therapies can be patented.

The lawsuit filed in 2009 claimed the patents violated patent law, restricting scientific research and patients’ access to medical care.

The appeal to the Supreme Court was backed by a number of organizations representing health care professionals, including the American Medical Association, and other groups.

The appeal argued that the question of whether genes and the information they convey can be patented is of “paramount importance to the future of patent law, the advancement of medical science and patients’ health.”

Myriad opposed the appeal. Its shares rose more than 2 percent after the Supreme Court’s order.

The attorney representing the company, Gregory Castanias, told the Supreme Court that patents involving isolated DNA molecules have been issued for nearly 30 years, resulting in significant investment by biotechnology companies.

Castanias said the challenged patents at issue in the case were filed more than 16 years ago. He said the appeals court’s decision was correct and the “questions presented are unique to this case, factbound and unlikely to recur.”

The Supreme Court case is the Association for Molecular pathology v. Myriad Genetics, No. 11-725.

(Reporting By James Vicini; Editing by Gerald E. McCormick)

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