Edwards Lifesciences ($EW) crushed Medtronic ($MDT) once again in an ongoing battle over transcatheter heart valve patents. A U.S. District Court jury has ordered the Minnesota device giant to pay its California rival at least $394 million in damages.
The ruling calls into question the U.S. future of Medtronic's CoreValve transcatheter aortic heart valve, which is on track for FDA approval by the end of its 2014 fiscal year. Edwards' market-leading Sapien transcatheter aortic heart valve has approval in the U.S., Europe and other countries, and it is pursuing new clinical testing and approvals of next-generation options. Edwards has fought fiercely to protect Sapien's dominance in what has become an international patent battle with Medtronic. Medtronic has also won its own victories as the patent fight has raged on.
"Edwards holds a number of important patents in transcatheter valve technology, and we intend to continue to defend this intellectual property when it is used by others without permission," Larry Wood, an Edwards corporate vice president, said in a statement.
Medtronic, meanwhile, promised to appeal the decision in the U.S. Federal Circuit Court of Appeals.
"While we are disappointed in the jury's verdict, we continue to believe that this decision will be overturned on appeal," Neil Ayotte, a vice president and general counsel for Medtronic, said in a statement. "Medtronic has prevailed against Edwards in several legal actions relating to a European counterpart to this patent and others, and believes the Federal Circuit Court of Appeals will find no merit to Edwards' infringement claim."
Edwards said it will move to enforce the verdict and seek a permanent injunction against Medtronic and CoreValve in order to protect its Cribier family of patents, which expires in December 2017. The final cost to Medtronic could climb substantially higher, because the Delaware jury found that Medtronic's CoreValve transcatheter aortic heart valve "willfully" infringes on Edwards' U.S. Cribier transcatheter heart valve patent. With that added element of "willfullness," Edwards touted the fact that it can seek triple damages plus attorney's fees.
Edwards won another federal jury trial in 2010 that found Medtronic's CoreValve willfully infringed on Edwards' U.S. Anderson transcatheter heart valve patent and awarded damages. Medtronic made an $83.6 million payment on the matter last March, and the U.S. Supreme Court rejected Medtronic's appeal in October.
Not everything has gone Edwards' way, however, which creates some unpredictability in the U.S. appeals process. A German court, for example, had placed an injunction on Medtronic CoreValve sales in August, but an appeals court subsequently overturned that decision in November, determining that Edwards' Spenser patent claims in the matter were invalid.
Just this week, Edwards and Medtronic were promoting how they'd make a winning case to hospital administrators for their respective heart valves. The competition will get tougher later this year, when Boston Scientific ($BSX) launches its Lotus valve overseas.
- here's Edwards' announcement
- read Medtronic's full response
- check out Bloomberg's take