A new legal battle in a high-stakes legal war between Gilead Sciences and the U.S. government was launched Friday, when the California-based biotech firm filed a lawsuit alleging that by seeking its own patents, the U.S. Centers for Disease Control and Prevention (CDC) violated the terms of a research collaboration contract in the development of Truvada (emtricitabine/tenofovir disoproxil fumarate) for pre-exposure prophylaxis (PrEP).
Specifically, Gilead says the CDC violated four material transfer agreements and a clinical trial agreement between the company and the agency that “governed the terms of the more than 15-year collaboration” between the parties on HIV prevention drugs.
Gilead says the Department of Health and Human Services (HHS), which oversees the CDC, in 2006 “improperly” filed for patent protections and didn’t notify the company. Starting in 2015, patent officials granted the HHS four patents, covering the use of Gilead’s medicines for HIV prevention.
Neither HHS nor the CDC responded to a request for comment. In an email, a spokesperson for Gilead said the company would not comment on ongoing litigation and declined to comment beyond the statement it issued last week.
It’s the latest in a back-and-forth between Gilead and the government that began last year, when HHS sued the pharma company, claiming that because HHS owns the PrEP patent, it should be compensated for billions of dollars Gilead made from sales.
In February, Gilead lost its first attempt to invalidate patents owned by the federal government. The company has also argued that “others had conceived of using an antiretroviral therapy” such as Truvada to prevent HIV transmission, before HHS invented it.
In the suit filed last week, Gilead also asked for compensation for attorney’s fees it has paid as part of the patent disputes—and the company claimed it has suffered reputational harm.
An Awkward Partnership
As they fight over the potentially billions of dollars Gilead has made from Truvada, the company and the federal government continue to also be partners in a free drug-distribution program after Gilead’s sizable donation agreement last year. And the company may be playing a key role in responding to the COVID-19 pandemic with its drug that is currently in several clinical trials, remdesivir.
According to Christopher Morten, a teaching fellow and supervising attorney at New York University Law School’s Technology Law and Policy Clinic, the ongoing legal battle shows “the tension that arises when the government and industry are both collaborators and rivals.”
“The story of PrEP is a collaboration that should have gone differently, if the CDC had required Gilead to commit to fair pricing, and if the government had not let them have a monopoly [on PrEP],” Morten said.
Regarding Gilead’s latest legal salvo, Morten thinks it’s a “distraction.”
“Gilead has clearly coopted public research on PrEP and refuses to compensate the government for it. This [suit] and their effort to invalidate the patents is more of an effort to reshape the narrative and put off their day of reckoning.”
Interpreting the legalese in Gilead’s suit, Morten said the company is hedging its bets in case HHS wins its suit, which could allow the federal government to take back at least $3 billion Gilead has reaped from the sale of PrEP. The key section reads:
“22. In the unlikely event the HHS Patents are ultimately upheld, Gilead is also entitled to monetary damages in the amount of the difference between the royalties to which the Government claims it is entitled and the cost, on commercially reasonable terms, of a non- exclusive license to the purported invention(s) described in the ’811 Provisional and in the applications that resulted in the HHS Patents, in or around the time of filing those applications.”
“By saying it’s entitled to damages arising from the fact it collaborated with the feds, Gilead is suggesting that it should at least get its damages reduced if it loses to HHS,” Morten said. “This may be Gilead’s main issue, that because they provided meds for the research they should be entitled to a license, or at least the value of a license should be subtracted from the value of the patent if it loses the fight.”
It was only after sustained advocacy from the PrEP4All Coalition, with which Morten was involved, that HHS filed suit over patent infringement in November.
Not only hasn’t the government collected a cent from PrEP, not enough people are able to access it in order to bring about an end to the HIV/AIDS crisis, advocates say. The nonprofit AVAC estimated that as of October, fewer than 400,000 people in the world were using PrEP.
“Bottom line, Gilead wants a monopoly control over technology, research that taxpayer dollars funded, that could end HIV/AIDS in our time,” said Peter Maybarduk, director of the advocacy nonprofit Public Citizen.
Maybarduk thinks Gilead was surprised that HHS would try to fight for patent rights. “The latest move is about political posturing, of, ‘You sue us, we’ll sue you,’” he said.
“It’s too common for the government to give its [patent] rights away,” he continued. “We shouldn’t be monopolizing drugs, especially meds that can make a big difference in public health.”
Maybarduk said that the fight over PrEP patents is especially salient now, with the announcement that trials show the drug remdesivir could shorten the duration of COVID-19 illness, at least in one trial. Remdesivir was developed by Gilead, and, if it’s determined to be an effective treatment for COVID-19, the government should get out in front of the patent battle immediately, Maybarduk said.
“We don’t yet know the terms and conditions or the limits of other companies to use remdesivir to build better treatments. But now is the time for the government to say, ‘No monopoly,’ and for Gilead to agree to license to all qualified manufacturers and put it in the public domain, and make it available to all who need it.”
Morten said HHS is likely to prevail in its patent-infringement suit. But he said the goal should not be for the government to collect a huge pot of money in damages. “The best outcome is for Gilead and the government to settle this matter, soon, and for the company to agree to a price cut, allowing more generics sooner, donate free doses, and doing everything possible to make PrEP more accessible. Every month they litigate is time people go without PrEP.”