Genmab Announces the Initial Resolution of its Arbitration with Janssen Relating to their Daratumumab License Agreement
COPENHAGEN, Denmark; April 8, 2022 – Genmab A/S (Nasdaq: GMAB) announced today an award in the binding arbitration of two matters arising under its license agreement with Janssen Biotech, Inc. (Janssen) relating to daratumumab. The arbitral tribunal issued an award on April 7, 2022, deciding both issues in favor of Janssen. Genmab has the right to seek review of the award, which it must do within a limited period of time. Such review should conclude with the issuance of a final award prior to the end of 2022. Genmab is currently considering its options.
The first issue concerned the question as to whether Janssen’s obligation to pay royalties on sales of licensed product extends, in each applicable country, until the expiration or invalidation of the last-to-expire relevant Genmab-owned patent or the last-to-expire relevant Janssen-owned patent covering the product, as further defined and described in the license agreement.
As to that issue, the tribunal determined by majority opinion that Janssen’s obligation to pay royalties to Genmab on sales of licensed product, in each applicable country, extends through the expiration or invalidation of the last-to-expire relevant Genmab-owned patent covering the product or use thereof, but not the relevant Janssen-owned patent. The relevant Genmab-owned issued U.S., European and Japanese patents will expire in the late 2020s and early 2030s.
The second issue concerned the question as to whether Genmab is required to share in Janssen’s royalty payments to Halozyme Therapeutics, Inc. for the Halozyme enzyme technology used in the subcutaneous formulation of daratumumab (marketed as DARZALEX FASPRO® in the U.S.). The royalties Janssen pays to Halozyme represent a mid-single digit percentage rate of subcutaneous daratumumab sales. Janssen reduced its royalty payments to Genmab by what it claims to be Genmab’s share of Janssen’s royalty payments to Halozyme beginning in the second quarter of 2020 and has continued to do so through December 31, 2021.
As to that issue, the tribunal ruled by majority opinion that Janssen is permitted to continue reducing its royalty payments to Genmab as an offset against a share of Janssen’s royalty payments made to Halozyme Therapeutics, Inc. Genmab had already assumed that Janssen would continue to withhold what it claims to be Genmab’s share of Janssen’s royalty payments to Halozyme as a reduction to estimated 2022 revenue in its guidance as of February 16, 2022, and as such our 2022 financial guidance remains unchanged.
In accordance with the license agreement, the arbitration was conducted before a tribunal of three arbitrators. The arbitration is confidential, subject to the parties’ disclosure obligations under applicable law. Other than pursuant to these obligations, Genmab does not intend further to comment or to provide additional information regarding the arbitration. Genmab’s collaborations with Janssen, including relating to daratumumab, will continue.
Genmab is an international biotechnology company with a core purpose to improve the lives of people with cancer. For more than 20 years, Genmab’s vision to transform cancer treatment has driven its passionate, innovative and collaborative teams to invent next-generation antibody technology platforms and leverage translational research and data sciences, fueling multiple differentiated cancer treatments that make an impact on people’s lives. To develop and deliver novel therapies to patients, Genmab has formed 20+ strategic partnerships with biotechnology and pharmaceutical companies. Genmab’s proprietary pipeline includes bispecific T-cell engagers, next-generation immune checkpoint modulators, effector function enhanced antibodies and antibody-drug conjugates.
Genmab is headquartered in Copenhagen, Denmark with locations in Utrecht, the Netherlands, Princeton, New Jersey, U.S. and Tokyo, Japan. For more information, please visit Genmab.com and follow us on Twitter.com/Genmab.
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Genmab A/S and/or its subsidiaries own the following trademarks: Genmab®; the Y-shaped Genmab logo®; Genmab in combination with the Y-shaped Genmab logo®; HuMax®; DuoBody®; DuoBody in combination with the DuoBody logo®; HexaBody®; HexaBody in combination with the HexaBody logo®; DuoHexaBody® and HexElect®. DARZALEX FASPRO®is a trademark of Johnson & Johnson.
Company Announcement no. 14
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