Tech Transfer eNews Blog

WARF ordered to pay Washington U $31.6M in royalty dispute

By Jesse Schwartz
Published: December 4th, 2018

In a long-running legal battle over royalties from a successful kidney treatment, the tech transfer arm of the University of Wisconsin (UW) has been ordered to pay $31.6 million to Washington University in St. Louis (WUSTL).

The dispute is centered on a treatment developed in a research collaboration at the two universities. In 1995, they applied for a patent and agreed to allow the Wisconsin Alumni Research Foundation (WARF) to obtain the patent and license it, in exchange for a larger share of any royalties.

WARF licensed the treatment to Abbott Laboratories in 1998 for use in connection with Zemplar, a drug for people with chronic kidney failure that became part of Abbott spinout company AbbVie. Zemplar is covered by 31 patents belonging to different entities, and royalties from the drug are distributed amongst them.

In 2013, WUSTL filed a lawsuit accusing WARF of breaching the 1995 agreement by undervaluing the patent. The university alleges that the foundation paid royalties “based on a tiny percentage” that it had assigned as the patent’s relative value in the context of the other patents behind Zemplar.

According to WUSTL, the kidney treatment had “generated hundreds of millions of dollars in licensing revenues” for WARF, which retained more than 99% of the royalties — over $300 million — for itself.

In the 2013 lawsuit, WU asked for more than $38 million from WARF. In late November, Delaware Senior District Court Judge Joseph Bataillon decided in WUSTL’s favor to the tune of $31.6M

“We remain disappointed that the foundation would not negotiate a resolution and that we had to resolve this matter through the court system,” says a WUSTL spokesperson. WARF notes that it is reviewing the decision.

Source: LSIPR

Posted under: Tech Transfer e-News

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