Ucb's Lack Of Candour

This is a follow upwardly to concluding Friday's post virtually UCB - the large Belgian pharmaceuticals company. It in all probability helps if you lot read that post first.

In Friday's post I outlined the state of play regarding UCB's of import Vimpat patent. Disputes virtually that patent accept been background for the stock for closed to time. When I went to see UCB inward Kingdom of Belgium (1 Dec 2015) the IR officers were straightforward virtually this. Third political party patent challenges were the comport story on the stock. 

But UCB has since so touted victories inward their patent disputes as well as regularly touted extensions of the Vimpat franchise.

• On fourteen August 2016 UCB released a press unloosen titled U.S. District Court confirms validity of patent for UCB's Vimpat®. That press unloosen detailed a commutation victory against ane of 2 third-party challengers of the patent. The stock went upwardly sharply. 

UCB has made many press releases detailing exactly how of import the Vimpat franchise is to them. 

• When the CEO (Jean-Christophe Tellier) was appointed the press release stated: "Jean-Christophe Tellier joined the fellowship inward 2011 as well as was instrumental inward establishing the company’s electrical flow strategy; he has played a commutation role inward driving the increment of UCB’s 3 marrow medicines, Cimzia®, Vimpat® as well as Neupro®."

• UCB has been active inward touting Vimpat both inward the European Union as well as the U.S. every bit a monotherapy for epilepsy. (See here and here.)

• UCB has been extremely active extending labels for Vimpat inward Japan. (See here for an example.)

Indeed extensions of the Vimpat franchise accept been of import inward UCB's increment strategy.

So it was deeply surprising to us when UCB neglected to say the marketplace that U.S. Patent Office had reviewed the patent (an ex-parte review) as well as had decided to take the patent entirely. [You tin uncovering the missive of the alphabet that the Patent Office sent here.]

This is an unusual move. Since the ex parte examine organization was introduced (35 years ago) virtually 13,500 ex parte requests for examine has been made exactly over a one m of them accept had all claims rejected. You tin uncovering statistics here. Rejected hither is a term of art. Influenza A virus subtype H5N1 claim is "objected" for all sorts of formal reasons similar the claims non beingness properly grouped. Influenza A virus subtype H5N1 "rejection" is a determination that the claim is non patentable - as well as is appellable to the Patent Trial as well as Appeal Board (a court) as well as so to the courtroom system. 

This is altogether a dissimilar type of threat to UCB. Past patent disputes accept been with other companies wanting to unloosen a generic - as well as thence far UCB has either had the illustration thrown out or got a pregnant delay. These are measure commercial disputes with commercial parties. And inward every ane of these disputes the courtroom has worked on the supposition that UCB has a valid patent as well as the inquiry is whether the other political party is infringing on this patent. 

This dispute is with the U.S. Government. The U.S. Government has reviewed past times decisions as well as decided that Vimpat is only non-patentable. That is the U.S. Government has determined that UCB does non ain a valid patent. Sure UCB has 2 months to endeavour as well as convince a (well informed) patent examiner otherwise - but their chances of this are low. The patent examiner volition endure experienced inward this expanse as well as it is non every bit if the bureaucrat was uninformed that this was a controversial as well as of import case.

After the 2 months has elapsed UCB could appeal to the Patent Trial as well as Appeal Board. However the measure here is the de-novo patent standard. The province of affairs is every bit if Vimpat had its master copy patent comprehensively rejected as well as it has to appeal to a courtroom against the scientist/reviewers at the Patent Office. The courts are unremarkably pretty deferential to the examiners at the Patent Office on the footing that they accept the disinterested expertise to assess patents. 

In this illustration Johnny Railey was the examiner as well as he is alongside the most experienced biotech patent examiners inward the US. You tin uncovering his linked inward CV here. You tin uncovering a real extensive listing of patents inward which he was the examiner here. 

Appeals of this form almost ever fail. As Johnny Railey is alongside the most experienced patent examiners the endangerment of an appeal succeeding is fifty-fifty lower.

For practical purposes the Vimpat patent is almost sure enough dead - as well as UCB's much ballyhooed increment strategy volition choke with it.

I am surprised at the lack of a management press release.

Disputes with the U.S. Government

UCB has press released interim victories inward District Court against commercial claimants on the Vimpat patent.

Their IR officers accept been willing to laissez passer up-to-date reports of the (mostly) favourable commercial disputes they have.

But in that location is non a discussion hither that their (new) dispute is with the U.S. Government as well as the default seat from hither (statistically probable to endure upheld) is that they volition lose their patent inward its entirety.

Not disclosing a business-critical dispute with the U.S. Government is strange.

Whatever: shareholders should inquire themselves how other European companies accept prevailed inward dispute with the U.S. Government.

John