BMS, Ono Pharma and Merck resolve PD-1 antibody patent litigation

Merck to pay BMS and Ono royalties on global sales of Keytruda through 2026, and lump-sum payment of $625 million.

Bristol-Myers Squibb (BMS) and Ono Pharmaceutical Company have signed a global patent license agreement with Merck & Co., to settle all patent-infringement litigation related to Merck’s PD-1 antibody Keytruda (pembrolizumab). The agreement will result in the dismissal with prejudice of all patent litigation between the companies pertaining to Keytruda. BMS and Ono, who discovered and developed the PD-1 antibody Opdivo (nivolumab), had asserted in litigation that Merck’s sale of Keytruda infringed the companies’ patents relating to the use of PD-1 antibodies to treat cancer in the US, Europe (UK, Netherlands, France, Germany, Ireland, Spain and Switzerland), Australia, and Japan.

As part of the agreement, Merck will make an initial payment of $625 million to BMS and Ono. Merck is also obligated to pay ongoing royalties on global sales of Keytruda of 6.5% from 1 January 2017 through 31 December 2023, and 2.5% from 1 January 2024 through 31 December 2026. Under the agreement, the companies have also granted certain rights to each other under their respective patent portfolios pertaining to PD-1. The royalties will be shared between BMS and Ono in a 75/25 percent allocation, respectively.

"BMS and Ono’s agreement with Merck protects our scientific discoveries and validates the strong intellectual property rights we secured as the early innovators in the science of PD-1, a key mechanism in immuno-oncology that has proven to have transformational impact in cancer care," says Giovanni Caforio, CEO, BMS. "Today’s agreement is also a good decision for patients as it supports the continuation of ongoing research and maintains access to anti-PD-1 therapies for cancer patients around the world."