Kymouse's stay of execution

Earlier this year, this Kat reported on the UK Court of Appeal decision that Regeneron's patent EP1360287, and its divisional EP2264163, were sufficient and infringed by Kymab (IPKat posts here and here). The Regeneron v Kymab dispute concerns highly valuable platform technologies for antibody therapeutics.

Following continued disagreement between the parties, the Court of Appeal has now issued its judgment on the form of order. The court ordered a final injunction restraining Kymab from infringing the patents and  delivery up and destruction of products produced by the claimed methods, including relevant antibodies and antibody producing cells. Kymab, in turn, was granted a stay of the injunction pending an application to appeal to the Supreme Court (and if permission is granted, the appeal).

In arriving at his decision, Lord Justice Kitchin considered the potential impact of the Form of Order not only on the parties but also on the development of clinically significant therapeutics.

Kymab's research

Since publication of its Kymouse platform in 2014 (Lee et al. Nature Biotech), Kymab has significantly invested in the use of the technology for research and development in a range of disease areas, in collaboration with a number of partners.

In 2016, Kymab, in collaboration with The Scripps Research Institute (TSRI) and the International AIDS Vaccine Initiative (IAVI), published the use of Kymouse antibodies to produce antibodies targeting HIV-1 (Sok et al. Science). The methods used HK and HKL Kymouse strains (products to which the infringement action relates). Kymab subsequently received a $9m grant from the Bill & Melinda Gates Foundation for research and development of immunotherapies and vaccines for infectious disease. Kymab indicates that in their infectious disease pipeline, they have active programmes for malaria, thyphoid fever, HIV and whooping cough.

HIV-1 virions
Kymab is also currently collaborating with Heptares, a UK based drug discovery company specializing in drugs targeting the G-protein coupled receptor (GPCR) super-family. In 2016, Kymab announced a partnership with Heptares for research, development and commercialization of immuno-oncology therapeutics targeting GPCRs. According to the Heptares press-release, under the agreement Heptares would provide the GPCR antigen targets and Kymab would use their Kymouse platform to produce antibodies against the target.

Stay of injunction

Kymab requested a stay of the injunction for certain activities. Particularly, Kymab requested that it may be allowed to continue to supply and export Kymouse antibodies, serum and antibody producing cells for the purpose of preparing and conducting pre-clinical and clinical trials and for the purpose of its collaborations with the the Gates foundation, IAVI and Heptares.

In support of Kymab's request, the Kymab's CEO Dr Chiswell submitted a witness statement describing Kymab's collaborations with the Gates foundation. Dr Chiswell indicated that Kymab currently has three antibodies at clinical stage development with the potential to treat indications including inflammatory and autoimmune diseases and late stage cancer, and that Kymab has a further series of antibodies at an earlier stage of development targeting the pertussis toxin and the malaria parasite, for which they are "collaborating with a number of research institutes appointed by the Gates Foundation to develop novel antibody therapies for the developing world on a non-commercial basis".

Dr Chriswell
In reply, Regeneron submitted that it only objects "insofar as Kymab wishes to pursue commercial activities beyond" clinical trials with the Gates foundation.  It further argued that Kymab had not clarified the extent to which its collaboration with the Gates Foundation covered commercial activities in addition to humanitarian matters, nor had it disclosed the relevant agreements to support those assertions. Regeneron voiced further concern that even if Kymab agreed not to commercialize the antibodies before expiry of the patents, they could use their infringing activities as a springboard following expiry.

The Court Appeal were "in no doubt that, if the injunction and the order for delivery up or destruction are not stayed pending the final determination of any appeal to the Supreme Court, Kymab will suffer serious loss and damage which will be extremely difficult to quantify" and that "imposition of the final injunction would bring to an end or at least seriously disrupt the projects...seeking to develop antibodies for the treatment of...diseases for which there is a significant unmet clinical need, sometimes in developing countries. These are powerful overarching factors in assessing where the balance of justice lies". 

The Court of Appeal were similarly in no doubt that Regeneron would "suffer irreparable harm" if Kymab were to commercialize antibodies arising from the Gates foundation collaboration, and that Kymab's successful collaborations represent lost opportunities to Regeneron. 

On balance, the Judge granted the stay of the injunction on the condition that Kymab undertakes not to commercialize any product developed under its partnership with the Gates Foundation prior to the final determination of its appeal and with a limit on further collaborations.

Kymab's ability to pay

Regeneron also raised concern over whether Kymab would be able to pay the potential final damages in light of Regeneron's estimate that the damages may exceed £60 million (based on deals Regeneron themselves have struck with other companies for their platform, worth hundreds of millions of dollars).  The Court of Appeal judgment explains that Kymab has assets of around £15 million and Kymab Group Ltd (Kymab's parent company) has assets of around £45 million, whilst Kymab's "recent accounts show current liabilities of around £72 million, and suggest that it is solvent only because it has a loan of around £80 million from Kymab Group Ltd". Regeneron proposed that a condition of any stay should be for Kymab to ring-fence £60 million of its assets.

The Court of Appeal determined that there was a real prospect that such a security condition would drive Kymab out of business, frustrate any further appeal and lead to a termination of the humanitarian work that Kymab is undertaking with the Gates Foundation and others. The Court therefore declined to make the security sought by Regeneron a condition of granting the stay of the injunction and order for delivery up.

Kymab, The Bennet Building, Cambridge (UK)
Throughout the most recent judgment, the Court of Appeal paid particular attention not only to the impact on the parties, but also to the potential public policy consequences of the decision.

We await the outcome of Kymab's request for permission to appeal to the Supreme Court. Watch this space.  

Not yet the end of the road for the Kymouse
Author: Rose Hughes
Kymouse's stay of execution Kymouse's stay of execution Reviewed by Rose Hughes on Monday, June 11, 2018 Rating: 5

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