Ligand Pharmaceuticals Incorporated and The Rockefeller University have entered into a Settlement Agreement and mutual release.
Pursuant to the terms of the Settlement Agreement, the parties have resolved all disputes that have arisen between them in litigation, including Rockefeller's primary claim relating to the development of Promacta (eltrombopag). In addition, the parties have agreed to jointly seek dismissal with prejudice of all claims and counterclaims asserted in the ongoing litigation between the parties.
Ligand and Rockefeller agreed to terminate their 1992 license agreement. The termination of the license agreement will not negatively affect previously granted sublicenses or conveyances of rights to any third party and under the license agreement. Ligand does not believe that it requires a license from Rockefeller for its ongoing business activities, but Rockefeller has granted Ligand and its sublicensees a covenant not to sue under any patents or know-how that were the subject of the license agreement for any past, present or future use of such patents or know-how.
As part of the settlement, Ligand agreed to pay Rockefeller $5 million upon entering into the Settlement Agreement, $2 million in payments over the next two years, plus royalties derived from product sales including for TPO mimetic compounds licensed to GlaxoSmithKline (GSK). Ligand will pay Rockefeller a 5.88 per cent share of royalties it receives from GSK on world-wide annual sales of eltrombopag of up to $1.5 billion, and a 7.0 per cent share of royalties it receives from GSK on sales of eltrombopag greater than $1.5 billion in any given year. Ligand will pay Rockefeller 1.5 per cent of world-wide annual net sales of LGD-4665. In addition, Ligand will pay Rockefeller 50 per cent of any future milestones it receives from GSK under the license agreement GSK entered into with Ligand in 1994. There will be no sharing of milestone payments related to LGD-4665.
This Settlement Agreement largely ends the relationship between Ligand and Rockefeller that dates back to the 1992 license agreement, under which Ligand licensed from Rockefeller certain technology relating to cytokine-activated Signal Transducers and Activators of Transcription (STATs) to control gene expression. On March 4, 2008, Rockefeller filed suit in the Supreme Court of the State of New York against Ligand alleging, among other things, a breach by Ligand of the 1992 license agreement, as well as other causes of action. Ligand denied the claims and filed an answer and counterclaims.
"We are pleased with the amicable resolution of this matter," said John L. Higgins, president and chief executive officer of Ligand Pharmaceuticals. "We believe the settlement with Rockefeller is in the best interest of our company and our shareholders."
Ligand discovers and develops new drugs that address critical unmet medical needs of patients with muscle wasting, frailty, hormone-related diseases, osteoporosis, inflammatory diseases, anaemia, asthma, rheumatoid arthritis and psoriasis.
The Rockefeller University is a world-renowned centre for research and graduate education in the biomedical sciences, chemistry, and physics.