Digene wins HPV patent dispute with Beckman Coulter in arbitration

By Lisa Kerner

Charlotte, N.C., July 31 - Digene Corp. said the International Center for Dispute Resolution of the American Arbitration Association ruled in Digene's favor in its arbitration with Beckman Coulter, Inc.

The dispute between the two companies dates back to September 2002, when Ventana Medical Systems, Inc. acquired Beckman Coulter's human papillomavirus (HPV) business, including the assignment of the HPV intellectual property portfolio acquired by Beckman from Institut Pasteur through a 1991 sublicense agreement.

The arbitration panel ruled that Beckman's sale to Ventana of its HPV intellectual property portfolio acquired from Institute Pasteur violated an original cross-license agreement between Institute Pasteur and Digene.

Beckman maintains that it was permitted, as part of its sale of its HPV business to Ventana, to assign the HPV licenses it received from Institut Pasteur.

The company added that the licenses have been properly in the hands of Ventana since September 2002. The International Chamber of Commerce in Paris ruled in favor of Beckman to a similar challenge brought forth by Institut Pasteur regarding the same transaction.

In addition, the panel found that the cross-license agreement prohibited Beckman from supplying unfinished HPV 35 materials, such as cell paste, to third parties, which it had done prior to the sale of its HPV business to Ventana.

Beckman noted the reagent sales, valued at less than $10,000, occurred prior to September 2002. The sales had been approved by the ICC Paris tribunal, the company said. Digene is not seeking damages.

Beckman said it has never purchased HPV materials under a supply agreement with Ventana, nor does it plan to do so. That supply agreement will be terminated.

In November 2001, Digene filed an action for patent infringement against Ventana Medical Systems, claiming the company had made, used, sold and/or offered for sale products embodying its patented human papillomavirus inventions.

A bench trial determined that while Beckman had a right to arbitrate Digene's claims against it, Ventana did not. The court stayed the proceedings against Ventana pending the outcome of the arbitration between Digene and Beckman.

Digene, based in Gaithersburg, Md., develops, manufactures and markets proprietary DNA and RNA testing systems.

Beckman, based in Fullerton, Calif., manufactures biomedical testing instrument systems, tests and supplies.

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