Gilead and ViiV Healthcare Settle Global Patent Dispute for Over $1B USD

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Photo by Memed Nurrohmad (Pixabay)

Brandon Pierre is an IPilogue Writer and a 1L JD Candidate at Osgoode Hall Law School.

 

In a dizzying exception to an exception of a rule, the case of Gilead’s HIV drug bictegravir underscores the value of a well-planned legal strategy.

ViiV Healthcare (“ViiV”), majority-owned by GlaxoSmithKline (“GSK”), claims that Gilead’s bictegravir (sold under the brand name “Biktarvy”) directly copied its dolutegravir’s formulation under U.S. Patent 8,129,385 (“patent 385”). The two companies have agreed to settle with Gilead paying $1.25 billion USD upfront to GSK in early 2022, followed by paying three percent royalties on all future U.S. sales of Biktarvy.

This article delves into the legal doctrines that support the parties’ claims and the overarching strategy to their settlement. The comments pertain specifically to ViiV Healthcare Company v Gilead (case 18-224) in the U.S. District Court for the District of Delaware.

Note that the doctrine of equivalents, dedication-disclosure, and specific exclusion only apply in the United States. Canada uses a purposive approach (see Free World Trust).

Doctrine of Equivalents

ViiV alleges Gilead infringed upon patent 385 under the doctrine of equivalents, which has two exclusions: dedication-disclosure and specific exclusion.

The doctrine of equivalents prevents parties from circumventing literal infringement by making minor variations to a patented invention. Under the doctrine of equivalents, a patent can be infringed upon if these variations are immaterial. For example, whether a bike has 32 spokes or 36 spokes, it is still a bike.

In a February 2020 motion, Gilead argued that ViiV could not rely on the doctrine of equivalents due to the dedication-disclosure rule and the doctrine of specific exclusion (see page 2).

Dedication-Disclosure Rule

In the U.S., the dedication-disclosure rule states that if a patent discloses or describes a novel feature, but that feature isn’t listed in the patent’s claims, then the feature is dedicated to the public and is not patent-protected (Johnson). For example, a patent could describe a bike with two wheels (bicycle), three wheels (tricycle), or four wheels (quadracycle) and then only claim the two-wheeled design. Under this doctrine, the inventor could not then sue another for using the three-wheeled or four-wheeled design.

Gilead posited that since patent 385 described, but did not claim, the formulation used in Biktarvy, it is available to the public and cannot be recaptured through the doctrine of equivalents (Eagle Pharmaceuticals). In Canada, the Federal Court granted Gilead a summary trial and dismissed ViiV’s claims on a similar basis.

Doctrine of Specific Exclusion

The doctrine of specific exclusion states that a product cannot be deemed equivalent to a patented invention if it is literally the opposite of the patented invention. A product can be deemed “outside the reach of the doctrine of equivalents because that [product] is clearly excluded from the [patent’s] claims whether the exclusion is express or implied” (SciMed Life Systems). For example, a patent for an “electric” bike cannot be equivalent to a “non-electric” bike.

Issues regarding expert testimony, construction of legal claims, and legal precedent ultimately defeated Gilead’s argument for specific exclusion (see page 6).

Concluding Remarks

In the end, settlement was in the best interests of both parties. Pursuing protracted lawsuits in Canada, Australia and elsewhere could exponentially increase litigation costs if the matter were left to courts. There are also significant profits at stake. Sales forecasts for the drug were $1B USD in 2018 and rising to $5B USD annually by 2024 (see Thomson Reuters I/B/E/S). These targets were far surpassed in 2019 when the drug delivered $4.74B in global sales.

The global settlement includes a worldwide patent license to certain ViiV patents related to dolutegravir. ViiV also agreed not to enforce their patents against Gilead for any future product containing bictegravir in exchange for royalties. Since the science implies that both bictegravir and dolutegravir have equivalent efficacy, the agreements suggest both pharmaceutical companies can move forward profitably.

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