Legal fees are costing firms millionsThe war over ultrasound contrast agents hasn't gone away, despite the commercialization of one of the products involved in the fray, Optison from Molecular Biosystems of San Diego. Lawsuits are still pending in
Legal fees are costing firms millions
The war over ultrasound contrast agents hasn't gone away, despite the commercialization of one of the products involved in the fray, Optison from Molecular Biosystems of San Diego. Lawsuits are still pending in two federal courts over ultrasound contrast technology, while patents are also being contested at the U.S. Patent and Trademark Office (PTO).
The battle began last year when a number of ultrasound contrast companies filed suit in an effort to change the way the Food and Drug Administration was regulating Optison. They were successful, but MBI and its marketing partner Mallinckrodt responded with litigation in the U.S. District Court for the District of Columbia seeking to invalidate contrast patents held by their competitors (SCAN 8/6/97). The firms filed suit against Sonus Pharmaceuticals, ImaRx Pharmaceutical, Du Pont Merck, Bracco, and Nycomed.
Only the suit against Nycomed is currently active, as the judge dropped the cases against the other defendants, ruling that the court lacked jurisdiction. Mallinckrodt and MBI have declined to pursue litigation against the other firms, with the exception of Sonus, whose product EchoGen is closest to market. MBI and Mallinckrodt plan to refile their suit against Sonus, probably in Seattle, near Sonus' Bothell, WA, headquarters, according to Neil Muhilly, vice president of ultrasound for Mallinckrodt.
Sonus has joined in with a lawsuit of its own (SCAN 1/14/98). The case in the U.S. District Court for the Western District of Washington in Seattle alleges infringement by MBI and Mallinckrodt of two patents held by Sonus. No trial date has yet been set, and Sonus executives declined to comment on the litigation.
In addition to the court cases, MBI and Mallinckrodt have brought challenges in the PTO against five patents held by Sonus, Nycomed, and ImaRx, asking the PTO to review the patents for validity. Each of the patents addresses the use of perfluorocarbon and, as a result, their holders could follow the lead of Sonus in filing patent infringement suits regarding Optison, which is also based on perfluorocarbon. MBI and Mallinckrodt believe that prior art existed on perfluorocarbon technology before their competitors' patents were filed, making their inventions unpatentable.
A decision on the Sonus patents rendered last November rejected the patents, due to the prior art issue. But the matter is anything but resolved. Sonus has since intervened and filed a response to the initial determination. The examiner must now decide whether the arguments are persuasive. If not, the patents could be ruled "finally rejected." But Sonus could then appeal that decision. This back-and-forth litigation could drag on for years-and that's just for the Sonus patents.
A Nycomed patent and two from ImaRx are also awaiting reexamination at the PTO. The Nycomed patent has been preliminarily rejected, according to MBI, while the PTO has not yet reported on the two from ImaRx. MBI and Mallinckrodt may also ask the PTO to reexamine a Bracco patent.
MBI and Mallinckrodt are pursuing the patent action because the overlapping patents could cause legal confusion in the future, and at worst could halt the sale of Optison or lead to the award of royalties or damages for patent infringement.
"Only one party at most can have a patent covering this technology," said Tom Jurgensen, vice president of legal affairs and general counsel for MBI. "A mistake has been made and we are trying to get the attention of the PTO to fix it."
The cost of fixing this problem could be high. In the last quarter of 1997 alone, legal fees totaled $1.2 million at MBI. For the fiscal year, legal costs, including the battle over how Optison should be regulated by the FDA, totaled $3.5 million for the San Diego company.