2 Top Drug Firms Reach Accord on Patent Rights

Schering-Plough and Hoffmann-LaRoche, drug giants that each own patent rights to a genetically engineered protein, agreed Thursday that each may sell the product without fear of being sued by the other for patent infringement.

The protein, called alpha interferon, occurs naturally in human beings and stimulates the body’s immune system against certain types of cancers and viruses.

Schering-Plough has licensed patent rights from Biogen, a leading biotechnology company that has developed a version of the protein at its headquarters in Cambridge, Mass.

In early March, Hoffmann-La Roche received a U.S. patent based on its version of the substance.

Hoffmann-LaRoche said at that time that it believed the patent award would prevent Schering-Plough from selling alpha interferon.

In April, however, Schering-Plough began marketing the protein in Ireland and has said it hopes to have approval from the Food and Drug Administration soon to begin selling the protein in the United States by year-end.

When Schering-Plough’s alpha interferon becomes available, it will be the second genetically engineered human drug for sale in this country. The first, human insulin, has been sold since 1983 by Eli Lilly under a licensing agreement with South San Francisco-based Genentech, another leading biotechnology company.

Patents are sure to play a key role in protecting the sales of genetically engineered products, just as they have for traditional drugs.

But Thursday’s announcement is a welcome sign in the emerging biotechnology industry. Some industry analysts and executives have expressed concern that protracted legal battles over patents might keep vital biotechnology drugs from consumers or drain the cash of fledgling companies.