Looking at the ADC Territory of Two Industry Pioneers From the DS-8201 Patent Dispute

A study by renowned American economist Edwin Mansfield suggests that 60% of new drugs would not be invented without patent protection, highlighting the importance of patent protection in the pharmaceutical industry today.

In fact, not only best-selling drugs such as PD-1 and CAR-T, but also ADCs these days cannot avoid patent disputes. Recently, Daiichi Sankyo announced that a Texas district court has made a final verdict on a patent dispute case between Daiichi Sankyo and Seagen, requiring Daiichi Sankyo to pay Seagen an 8% patent fee from April 1, 2022, to November 4, 2024, based on sales of its DS-8201 (brand name: Enhertu), and the licensing fee will expire on November 4, 2024, which is the expiration date of the patent 10808039 in question.

DS-8201 is an ADC drug developed by Daiichi Sankyo and AstraZeneca, composed of a humanized monoclonal antibody trastuzumab connected to the topoisomerase I inhibitor deruxtecan. It has been approved by the FDA for the treatment of human epidermal growth factor receptor 2 (HER2)-positive breast cancer, HER2-low expressed breast cancer, gastric or gastroesophageal junction (GEJ) adenocarcinoma, and HER2-mutated metastatic non-small cell lung cancer (NSCLC) and others.

The Origin and Resolution of a Patent Dispute

Seagen was established in 1998 and is one of the pioneers in the ADC field. In 2008, Daiichi Sankyo and Seagen reached a cooperation agreement to jointly develop a single antigen ADC product for various solid tumors. In the cooperation, Seagen authorized Daiichi Sankyo to use its cytotoxic and conjugation technologies in ADC product development. Later, as there was little progress in ADC drug development, the two companies terminated their cooperation in 2015.

After the breakup, both companies continued to explore on the ADC track separately. In September 2015, Daiichi Sankyo initiated a phase I clinical trial of DS-8201, laying the direction of development for DS-8201 in HER2-expressing or mutated tumors.

In 2019, AstraZeneca and Daiichi Sankyo signed a cooperation agreement for DS-8201, jointly responsible for the global development and commercialization of DS-8201 except in Japan, with a total transaction amount of up to $6.9 billion.

This move caught Seagen's attention. In November 2019, Seagen sued Daiichi Sankyo. Based on the comparison of the structure of DS-8201 and Daiichi Sankyo's other ADC technologies, Seagen found that Daiichi Sankyo's ADC product shows signs of improvement to its patents. Seagen believed that Daiichi Sankyo's ADC drug was obtained by improving its own patents, and according to the cooperation terms at the time, it also had the right to a share of DS-8201's sales revenue. The linker technology was the focus of their patent dispute. In the complaint, Seagen claimed that Daiichi Sankyo's patent No. 9808537 involved the binding technology of the linker platform and linker, which was derived from its own technology.

In the two and a half years of the fight, the court finally ruled that DS-8201 had infringed on Seagen's US patent 10,808,039 (protease-cleavable linker patent), and Daiichi Sankyo had to compensate Seagen $41.8 million. Seagen also sought a royalty using fee for DS-8201, but its contract with Daiichi Sankyo had expired by the time of the lawsuit and it did not succeed.

In August 2022, the court ruled that Daiichi Sankyo should retain its relevant patent rights for ADC drugs and continue to develop and commercialize these products as planned, with Daiichi Sankyo temporarily winning the lawsuit. In October 2023, a Texas district court made its final ruling on the patent dispute between Daiichi Sankyo and Seagen. It was ruled that Daiichi Sankyo should pay Seagen an 8% patent license fee from April 1, 2022, to November 4, 2024, based on sales of DS-8201. In the first half of 2023, DS-8201 sales were $1.169 billion. Daiichi Sankyo is expected to pay more than $500 million in patent licensing fees to Seagen.

ADC Territory of Seagen and Daiichi Sankyo

As an ADC star enterprise, ADC is the pillar of Daiichi Sankyo. Based on unique DXd ADC technology, Daiichi Sankyo currently has six new ADC drugs under clinical development: DS-8201/Enhertu (targeting HER2), Dato-DXd (DS-1062, targeting Trop2), HER3-DXd (U3-1402/Patritumab deruxtecan, targeting HER3), DS-7300 (targeting B7-H3), DS-6000 (targeting CDH6) and DS-3939 (targeting MUC1). Moreover, Daiichi Sankyo is actively laying out next-generation ADC technology platforms, with Claudin6 ADC DS-9606 entering the clinical stage.

As a pioneer in the ADC field, Seagen has currently launched three ADC products: Adcetris (targeting CD30), Padcev (targeting Nectin-4), and Tivdak (targeting TF).

At the same time, Seagen is also betting on the next ADC drug. In September 2023, Seagen reached a cooperation agreement with PROTAC leader Nurix, with a total value of up to 3.46 billion US dollars, dedicated to the development of Degradation Antibody Conjugates (DAC) with new mechanisms of action.

As a trailblazer in ADC technology, Seagen has accumulated a large number of ADC-related patents, with over 100 patent families covering a comprehensive range of ADC track, including compounds, sequences, pharmaceutical uses, and compositions.

Once, Seagen and Daiichi Sankyo witnessed the growth and progress of the ADC field together. Later, they went their separate ways due to patent disputes, which were brought to court. The structure of ADC is complex, involving linkers, antibodies, and toxins. This imposes more rigorous and detailed requirements on patent applications by pharmaceutical companies.

References：

1. Daiichi Sankyo official website.

2.https://www.biospace.com/article/seagen-loses-patent-battle-against-seagen-with-potential-implications-for-merck-buyout/.

3.https://www.biospace.com/article/astrazeneca-and-daiichi-sankyo-s-enhertu-becomes-first-her2-directed-therapy-for-nsclc/.