Bothell-based biotech Seagen Inc. (Nasdaq: SGEN) has lost an arbitration case against the Japanese drugmaker Daiichi Sankyo regarding its cancer drug Enhertu.
The decision, which Seagen announced Friday, comes after Seagen won a $41.8 million patent infringement case against Daiichi Sankyo in April. Seagen was seeking monetary damages as well as royalties from sale of Enhertu, which this month gained U.S. approval for lung and breast cancer.
In a release, Seagen said the arbitrator cited "statute of limitations and disagreement with Seagen on the interpretation of the contract" in the decision.
“While we are disappointed with the arbitration decision, it was important for us to pursue this legal action,” Roger Dansey, chief medical officer and interim CEO of Seagen, said in a release. “This does not impact our existing business. Looking forward, we are well-positioned to drive continued innovation and growth with four commercial products and a deep and diverse pipeline of promising programs."
AstraZeneca in 2019 inked a deal with Daiichi Sankyo to jointly develop and sell Enhertu. Between upfront payments and contingent payments, the deal was worth $6.9 billion and gave AstraZeneca rights to half of Enhertu's profits outside of Japan. Enhertu generated $214 million in revenue in 2021, according to AstraZeneca's annual report.
In a regulatory filing from late July, Seagen said Daiichi Sankyo's Enhertu technologies are improvements to Seagen's own technology that was protected under a 2008 collaboration agreement between the two biotechs.
Seagen, founded in 1998, is a cancer-focused biotech that has drugs on the market aimed at Hodgkin lymphoma, as well as breast, bladder and cervical cancer. The company is building a 270,000-square-foot biomanufacturing facility in Everett set to open in 2024.
The company's previous CEO and co-founder, Clay Siegall, resigned in May after an arrest on suspicion of domestic violence on April 23. Siegall took a leave of absence starting May 9, more than two weeks after the arrest, which the company didn't disclose when announcing his leave.
The Wall Street Journal in July reported New Jersey-based pharmaceutical giant Merck is in advanced talks to acquire Seagen for at least $40 billion. The paper later reported Merck was waiting for new clinical data for Seagen's bladder cancer treatment and for the decision in the arbitration case against Daiichi Sankyo, as both developments could affect Seagen's value.
Seagen's stock closed at $168.53 per share on Monday, down 1.6% from Friday's close. A Seagen spokesperson said the company didn't have a comment on the potential acquisition by Merck.
