Radiologists file patent lawsuitagainst UCSF and Hafslund Nycomed

March 1, 1995

MR method for imaging tissue perfusion at issueTwo former University of California at San Francisco radiologistshave filed a lawsuit against the university and Norwegian contrastdeveloper Hafslund Nycomed, alleging that the university

MR method for imaging tissue perfusion at issue

Two former University of California at San Francisco radiologistshave filed a lawsuit against the university and Norwegian contrastdeveloper Hafslund Nycomed, alleging that the university soldNycomed the royalty rights for a contrast technology the radiologistsinvented.

The radiologists claim that the university received only $12,500for a technology Nycomed believes could be worth up to $280 milliona year when it is commercialized.

The lawsuit was filed in November in U.S. District Court forthe Northern District of California in San Francisco by Dr. JohnKucharczyk and Dr. Michael Moseley. Kucharczyk was director ofUCSF's neuroradiology research laboratory until late last year,and Moseley was an associate professor of radiology. Moseley isnow with Stanford University, while Kucharczyk is with the Universityof Minnesota.

The technology in question involves a method-of-use patentthe two radiologists received in 1993 for magnetic susceptibilityperfusion imaging, which uses contrast agents and high-speed MRIsequences such as echo-planar imaging to examine tissue perfusion.Applications for which the technique is useful include early detectionof stroke and evaluation of therapeutic interventions for stroke.

According to a complaint filed by Kucharczyk and Moseley, theybegan work on the technology after receiving an experimental compoundfrom Hafslund Nycomed's Nycomed Salutar subsidiary, which wasbased at the time in Sunnyvale, CA. The compound, dysprosium DTPA-BMA,is related to gadolinium. Nycomed Salutar asked Kucharczyk andMoseley to develop medical applications for it and funded lessthan half of the research that led to the patent, the radiologistssaid.

In their research, Kucharczyk and Moseley found that DyDTPA-BMA,when administered in a bolus injection and in conjunction withEPI sequences, provided a useful means of developing a quantitativeindex of tissue perfusion and provided earlier detection thanother imaging modalities of the impact of pathologies such asstroke. In animal research, the radiologists found they coulddetect evidence of stroke within minutes of blocking off an arteryin the brain.

Kucharczyk and Moseley filed for and received a method-of-usepatent for the use of DyDTPA-BMA, gadolinium and other lanthanidechelates in conjunction with high-speed MRI sequences and computerreconstructions. The patent also covers other potential agentsused in this manner.

A billion-dollar patent? To continue their research, Kucharczykand Moseley applied for a grant in April 1990 from the CaliforniaDepartment of Commerce's competitive technology program (CompTech),which promotes the development of technology in the state. NycomedSalutar stated at the time that the commercial value of the technologycould be up to $280 million annually over the 17-year life ofthe patent, the complaint claims.

The radiologists received a $150,000 grant from CompTech, buton the condition that they assign their rights to the technologyto Nycomed Salutar to ensure its commercialization. To do so,Kucharczyk and Moseley provided information to the university'sOffice of Technology Transfer (OTT) so the university could negotiatea license with Nycomed Salutar.

The OTT ultimately reached a license agreement with NycomedSalutar. The exclusive license, however, called for a one-timepayment of $12,500 to UCSF and did not include any provision forroyalties to the radiologists or the university, according tocourt documents.

"The university went from a situation where it had fulland equal rights to use the invention any way it wanted, to onewhere it had no rights to use the invention," said RichardHarmon of Harmon and Tootell of San Francisco, the law firm representingthe radiologists.

Kucharczyk and Moseley charge that the royalty-free licenseviolates the University of California's patent policy, which requiresthat only royalty-bearing licenses be granted and that any royaltiesresulting from licenses be divided equally with the inventingfaculty members. The policy also states that no exclusive licensesbe granted unless the licensee funded 100% of the research thatresulted in the invention, the complaint states.

The radiologists are asking that they be declared the soleinventors of the patent and that the university's agreement withNycomed Salutar be rescinded. If the agreement is not rescinded,Kucharczyk and Moseley ask that the university be found in breachof their employment contracts and that they be awarded damages.The complaint alleges that the damages suffered by the radiologistscould be in excess of $50 million. A trial date has not been setfor the case.

A spokesperson for the University of California system disputedthe claims made by Kucharczyk and Moseley but declined to commentfurther because of the litigation.

Nycomed officials said they are caught in a dispute betweenthe university and two disgruntled former employees. The agreementbetween UCSF and Nycomed Salutar was a standard licensing arrangement,according to Chris Kilbane, manager of corporate relations forNycomed.

Nycomed also disputes the commercial value of the technology.The source of the $280 million figure is unknown, Kilbane said.In addition, research on the technology in question is on holdas the company investigates more promising agents, according toKilbane.

"Nycomed has been an innocent bystander in this wholething," Kilbane said. "We see this as a squabble betweenex-faculty members who are upset with the University of California,and somehow we are getting sucked into it."