Johnson and Johnson 2005 Annual Report Download - page 61

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS PAGE 59
Patent Litigation Against Various
Johnson & Johnson Subsidiaries
The products of various Johnson & Johnson subsidiaries are
the subject of various patent lawsuits, the outcomes of which
could potentially adversely affect the ability of those sub-
sidiaries to sell those products, or require the payment of past
damages and future royalties. With respect to all of these mat-
ters, the Johnson & Johnson subsidiary involved is vigorously
defending against the claims of infringement and disputing,
where appropriate, the validity and enforceability of the patent
claims asserted against it.
On July 1, 2005, a jury in Federal District Court in Delaware
found that the Cordis CYPHER®stent infringed Boston Scien-
tific’s Ding `536 patent and that the Cordis CYPHER®and BX
VELOCITY®stents also infringed Boston Scientific Corpora-
tion’s Jang `021 patent. The jury also found both those patents
valid. Cordis has asked the judge to overturn the jury verdicts
or grant a new trial. If the judge does not overturn the jury ver-
dicts, there will be a damage and willfulness trial in 2006 and
Boston Scientific will seek an injunction against CYPHER®
.If
upheld by the trial court, Cordis will appeal the jury verdicts to
the Court of Appeals for the Federal Circuit.
In March 2006, Boston Scientific’s case asserting infringe-
ment by the CYPHER®stent of another Boston Scientific patent
is scheduled for trial in Delaware Federal District Court. In that
case as well, Boston Scientific seeks an injunction and substan-
tial damages.
On January 26, 2005, the Federal District Court for the
Southern District of Florida granted Cordis summary judgment
dismissing a breach of contract and patent infringement suit
filed against Cordis by Arlaine and Gina Rockey seeking royal-
ties on the sales of all Cordis balloon expandable stents. Plain-
tiffs have filed an appeal with the Court of Appeals for the
Federal Circuit.
In an action filed in Belgium by Boston Scientific under
its Kastenhofer patent, Boston Scientific is seeking a pan-
European injunction against the sale of infringing catheters,
i.e., an injunction that would be effective not just in Belgium
but in all of the countries served by the European Patent Office.
Trial has not been scheduled but could occur during 2006.
The following chart summarizes various patent lawsuits
concerning products of Johnson & Johnson subsidiaries.
J&J Plaintiff/
Product Company Patents Patent Holder Court Trial Date Date Filed
Drug Eluting Stents Cordis Grainger Boston Scientific Corp. D. Del. 3/06 12/03
Stents Cordis Boneau Medtronic Inc. D. Del. * 4/02
Two-layer Catheters Cordis Kastenhofer Boston Scientific Corp. N.D. Cal * 2/02
Forman Belgium * 12/03
Stents Cordis Israel Medinol Multiple E.U. * 5/03
jurisdictions
Contact Lenses Vision Care Nicolson CIBA Vision M.D. Fla. * 9/03
* Trial date to be established.
Litigation Against Filers of Abbreviated New Drug
Applications (ANDAs)
The following chart indicates lawsuits pending against generic
firms that filed Abbreviated New Drug Applications seeking to
market generic forms of products sold by various subsidiaries
of the Company prior to expiration of the applicable patents
covering those products. These ANDAs typically include allega-
tions of non-infringement, invalidity and unenforceability of
these patents. In the event the subsidiary of the Company
involved is not successful in these actions, or the 30-month stay
expires before a ruling from the district court is obtained,
the firms involved will have the ability to introduce generic
versions of the product at issue resulting in very substantial
market share and revenue losses for the product of the
Company’s subsidiary.
As previously communicated and noted from the
following chart, 30-month stays are scheduled to expire
during 2006 with respect to ANDA challenges regarding
ORTHO TRI-CYCLEN®LO, RISPERDAL®and TOPAMAX®
. Trial
did not occur before the expiration of the stays with respect to
ORTHO TRI-CYCLEN®LO, is unlikely to occur with respect to
RISPERDAL®
,but could occur in the case of TOPAMAX® .Unless
30-month stays are extended or preliminary injunctions
granted, outcomes which are uncertain, final FDA approval to
market will occur shortly after expiration of the 30-month
stays. Because a firm that launches an ANDA product before
trial would be liable potentially for lost profits if found at trial to
infringe a valid patent, typically ANDA products are not
launched under such circumstances. Nonetheless, such “at
risk” launches have occurred in cases involving drugs of John-
son & Johnson subsidiaries, and the risk of such a launch can-
not be ruled out.