COPENHAGEN, Sept 23 (Reuters) – Shares in Danish biotech
firm Genmab fell as much as 14% on Wednesday after it
said it was locked in a legal battle with its partner Johnson &
Johnson over royalty payments for its key cancer drug.
Genmab, which specialises in the development of antibody
therapeutics for cancer treatment, currently receives royalties
from Janssen, a Johnson & Johnson company, for sales of its
blockbuster Darzalex drug for treatment of multiple myeloma.
The Danish firm said late on Tuesday that a New York
arbitration court will determine whether it is entitled to part
of Janssen’s royalty payments to Halozyme which
supplies the enzyme technology for Darzalex injections.
The arbitration will also decide the duration of Darzalex
royalty payments to Genmab, whether they should expire around
2030, when most of the Genmab patents expire, or in 2035 when
Janssen’s patents for Darzalex injections expire.
Most analysts assume Genmab will receive royalty payments
until 2035. If the arbitration court rules against Genmab on the
duration of Darzalex royalties, it would reduce the biotech
firm’s market value by a quarter, according to analysts at
Jefferies.
« While Genmab intends to vigorously protect its rights under
the agreement, the outcome of any arbitration proceeding, as
well as its duration, is inherently uncertain, » Genmab said.
The legal battle creates both an overhang and uncertainty
for Genmab shares, which will quickly be priced in, Citi
analysts said in a note.
Genmab was the worst performer on the European STOXX 600
index, trading 10.8% lower at 2154 Danish crowns each by 0833
GMT.
