Fight Continues Over Early Biotech Research

From MercuryNews.com (free registration required):

"It's one of many biotechnology legal disputes that just won't go away.
Last week, Genentech announced that the state Court of Appeal refused to overturn a $500 million judgment won by the City of Hope in a breach-of-contract dispute.

The case, which was decided by a jury in the Los Angeles County Superior Court in 2002, stemmed from one of the earliest achievements of the then-infant biotech industry. In 1976, scientists at the Southern California hospital and research center, working on a contract from Genentech, developed the technology for turning bacteria and yeast into factories for producing human proteins.

The work lead to the first biotech drugs -- human insulin and growth hormone. In return for the scientists' work, the City of Hope was to get 2 percent of future sales.

Genentech argued that it had paid the City of Hope all that was due, more than $300 million over the life of the contract.
The City of Hope contended that it had been shortchanged and was owed much more, including a share of licensing deals that Genentech had made with other companies.

The jurors sided with the City of Hope, awarding $300 million in back payments plus $200 million in punitive damages.
The company appealed to the state appellate court. And this month, Genentech lost that appeal."