Cambridge Antibody Technology and MorphoSys AG have agreed to settle all patent disputes between the two companies. The settlement agreement covers MorphoSys' past, present and future use and commercialisation of all versions of its HuCAL libraries, including the most recent development, HuCAL GOLD and relates to all patents in the ongoing disputes between the two companies.
The companies have agreed to terms under which CAT will receive an annual payment of Euros 1 million over the next five years. It will also receive other financial consideration from MorphoSys' activities related to its HuCAL GOLD libraries for a defined period of time. CAT will receive milestone and royalty payments under a licence for products developed using previous HuCAL libraries. In addition, CAT will receive an equity stake of 588,160 ordinary shares in MorphoSys under the licence agreement. MorphoSys retains the option to buy out its obligations to CAT for a pre-defined fixed amount at any time during the duration of the agreement.
MorphoSys will be free to develop and commercialise its HuCAL technologies. CAT undertakes not to sue MorphoSys in relation to present HuCAL GOLD libraries and all future derivatives thereof. In addition, MorphoSys will receive a licence to the CAT patent estate in respect of previous HuCAL libraries.
Peter Chambre, CAT's Chief Executive Officer, commented, "We are delighted to have agreed a settlement that means that both CAT and MorphoSys can now concentrate on getting on with their respective businesses. We have previously stated that we were prepared to work with MorphoSys to settle the actions on the right terms and this agreement puts an end to the distraction to both parties caused by the litigation. In addition, in reaching this agreement CAT shareholders will benefit from the future growth of MorphoSys' business."
"This is excellent news for us, which we believe will result in commercial benefit through increased deal flow," commented Dr Simon Moroney, Chief Executive Officer of MorphoSys AG. "Settlement also brings an end to investment of time and money in lawsuits. We are delighted to put this dispute behind us on very acceptable terms and to cement the agreement with an equity participation from CAT."