Juno and Novartis settle CAR-T patent fight with little fanfare

Juno CEO Hans Bishop

Novartis ($NVS) and Juno Therapeutics ($JUNO), pioneers in a promising new field of cancer treatment, have reached a settlement in their long-running patent dispute, clearing the way for each to advance rival therapies designed to weaponize the immune system.

Each party is developing so-called CAR-T therapies, which work by engineering a patient's own immune cells to better recognize malignancies and then re-infusing them to fight tumors. Under the settlement, Novartis and its partner, the University of Pennsylvania, will hand over $12.25 million to Juno and St. Jude Children's Research Hospital, plus future milestone payments and a mid-single-digit royalty on U.S. sales of CAR-T products affected by the lawsuit. Juno and St. Jude are also due a low double-digit percentage of the royalties Novartis has promised Penn.

In exchange, Juno is dropping a lawsuit that began in 2012, when St. Jude and Penn began squabbling over a contract, and intensified when industry turned its focus to the promise of CAR-T. The settlement calmly closes the loop on a lingering concern tied to Juno and Novartis' efforts in the field, allowing the two companies to get back to competing in the clinic rather than the courtroom.

"We are pleased by this settlement, which benefits patients by allowing each party to advance its promising cancer immunotherapies and rewards the investigators on whose insights those developments are based," Juno CEO Hans Bishop said in a statement.

Meanwhile, each contender is barreling forward with its CAR-T program, spending big in hopes of moving multiple candidates into late-stage trials. Juno is planning to get 10 such therapies into the clinic over the next year, investing in manufacturing and growing rapidly. For its part, Novartis has posted more and more stellar data for CTL019, its breakthrough-designated lead CAR-T asset, expecting to file the treatment for FDA approval next year.

The fervor over CAR-T has attracted a bevy of players into the fray, including biotechs Kite Pharma ($KITE) and Bellicum Pharmaceuticals ($BLCM), plus deep-pocketed magnates like Pfizer ($PFE), Celgene ($CELG) and Johnson & Johnson ($JNJ).

- read the statement

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