Celegene Shares Respond to Word of Markman Opinion Release‏

Shares of

are volatile following the report of the Markman Opinion on a patent dispute over five claims covering six patents with defendants Natco Pharma Limited, Arrow International Limited, and Watson Laboratories, Incorporated seeking approval to market a generic version of Revlamid.

In 2011, Celegene initially filed a complaint against Natco, claiming the generic version on Revlamid infringed on patents. Later that year, Celgene filed an amended complaint against Arrow and Watson. In October, 2013, the parties filed a Joint Claim Construction and Prehearing Statement for the patents at issue. A Markman hearing, where a judge examines evidence from all parties on patent claims to assist the jury in understanding meanings of complicated language and concepts, was recently held on March 15, 2014.

On Tuesday, a source got their hands on the filing of the Markman opinion. In the report, the Court described its interpretation of the five claims, signed by Susan D Wigenton, U.S.D.J. The first discussion claim highlighted the plaintiff and defendants construction of the R-configuration and the S-configuration. The document states, “this Court construes ‘said compound has the R-configuration' as ‘the stereochemical configuration of the compound is all or substantially all the R-isomer, thus excluding a compound that is a racemic mixture' and ‘said compound has the S-configuration' as ‘the stereochemical configuration of the compound is all or substantially all the S-isomer, thus excluding a compound that is a racemic mixture.'” With this definition, the Court agreed with the defendant's definition. The second disagreement was over the construction of “hemihydrate”. In this clarification, the Court sided with Celegene's definition of “a hydrate containing approximately half a mole of water to one mole of the compound forming the hydrate” as the construction is “supported by the intrinsic evidence.” The report further stated, “the claim language does not limit the molar ratio to be an exact 1:2 ratio of water to lenalidomide.” Also supported by “intrinsic evidence”, the Court found that the construction of “Form A” followed the defendants definition as “the lenalidomide crystal form described in the specification as Form A, having all of the characteristics assigned to Form A in the specification.” For phrases including “Form A” terms, as the fourth dispute, the Court found that the defendants' construction remains. In the last discussion claim over the construction of “Unsolvated Crystalline [lenalidomide]” terms, the Court agreed with Celegene, writing “This Court finds that the disputed terms do not require construction.”

With the Court “agreeing” with Celegene on two out of the five claims, shares fell 1.37 percent this morning, from $152.14 to $150.08. The stock has since recovered with gains. Shares of Celgene are currently trading at $152.82, up 1.79 percent from Friday's close.