PDL Biopharma dives after Genentech disputes Europe patents of 4 drugs, including HerceptinBy Marley Seaman, AP
Friday, August 13, 2010
PDL BioPharma plunges on dispute with Genentech
NEW YORK — Shares of PDL BioPharma Inc. plunged Friday on word of a royalty dispute between PDL and its collaborator Genentech.
Genentech has informed PDL that it does not believe four Genentech drugs infringe on patents held by PDL in Europe, PDL said. PDL receives royalties on sales of those drugs, and it recently moved to get the patents supporting the products extended into 2014. PDL, of Incline Village, Nev., said Genentech is violating a previous agreement between the companies and said it will try to have those patents enforced.
Genentech licensed antibody technology from PDL in 1998 and it pays royalties to PDL on sales of its cancer drugs Herceptin and Avastin, macular degeneration drug Lucentis, and asthma drug Xolair. PDL said Genentech plans to keep making royalty payments on those drugs when they are made, used, or sold in the U.S.
PDL said 30 percent of its revenue in the first half of 2010 came from royalties on sales of those four drugs that are made and sold outside the U.S. That’s about $55 million out of the company’s total of $182 million in revenue over that six-month period.
In midday trading, shares of PDL skidded $1.08, or 17.4 percent, to $5.12. Earlier they dropped to an 11-year low of $4.97.
PDL and Genentech, which is a unit of Swiss drugmaker Roche Holding, did not immediately respond to requests for comment.
(This version CORRECTS the drug sale royalties in the first half of the year.)