Celgene Corp. settled patent litigations with privately held Accord Healthcare Ltd. for its blockbuster cancer therapy Revlimid, also known as lenalidomide.
Generic drugmaker Accord launched lawsuits in the U.K. in June 2017 aiming to revoke Celgene's U.K. patents protecting Revlimid, which expire in June 2022.
Revlimid is expected to make $9.5 billion in 2018 and accounted for 68.2% of Celgene's 2017 sales revenue.
Under the terms of the patent settlement, Accord has agreed to "vacate challenges" to Celgene's patents, Celgene said in an SEC filing on July 5.
In addition, Celgene has granted Accord the right to market Revlimid's generic version for certain conditions in January and February of 2022, before Celgene's patents expire in the U.K. and other European countries.
Other terms of the settlement were not disclosed.
The settlement between Celgene and Accord has two key points — the deal is not for U.S. patents, and the timing of the settlement is slightly below expectations [for Celgene], Evercore ISI analyst Umer Raffat said in a note.
"For background, Celgene's 10-K had pegged the EU patent life of Revlimid for 2024, but consensus had slight erosion in 2023," Raffat, who holds an "outperform" rating on the stock, said in the note.
"However, today's settlement with Accord grants a launch in Jan/Feb 2022."
Offsetting Revlimid dependency
Celgene is searching for the next blockbuster and is expanding into new therapy areas as patents for Revlimid, which has driven more than 60% of the Nasdaq-listed biotech's drug sales over the years, near expiry.
Though the New Jersey-based company had a string of setbacks recently — one of its potential revenue replacement candidates, GED-0301, failed in a late-stage trial for Crohn's disease, and the U.S. Food and Drug Administration rejected its autoimmune disease treatment ozanimod — the drugmaker's annual report shows Celgene has a strong pipeline with eight therapies that could reach blockbuster status.
These include a chimeric antigen receptor T-cell, or CAR-T cell, therapy in partnership with Bluebird Bio Inc. and another in the portfolio after the company's acquisition of Juno Therapeutics earlier this year. CAR-T cell therapies are used for blood cancers.
Then on March 20, Celgene announced a partnership on neurodegenerative diseases with Prothena Corp. PLC
Celgene had a busy first quarter with profits rising 16% over the year-ago period and an increase in the higher range of its revenue forecast for 2018.