ZURICH (Reuters) – Roche on Thursday lifted its veil of secrecy over a patent that has reaped billions of dollars over the years but is due to expire on Dec. 18, depriving the Swiss drugmaker of a key source of income.
The so-called “Cabilly” patent brought in 834 million Swiss francs ($840.39 million) in 2017, Roche said in an 81-page report that accompanied its first-half earnings release.
The patent, named after one of its inventors, protects a pivotal step in manufacturing therapeutic antibodies and requires drug companies making biological medicines to pay Roche royalties. California’s City of Hope medical center also gets its own share of royalties from the famous patent, which has been the subject of numerous court disputes.
Estimates have been available for recent patent income, but Roche disclosed it on Thursday to help prepare investors and analysts for future royalty income the company acknowledges “will be significantly lower.”
The 834 million figure is higher than analysts at Barclay’s Capital assumed, they wrote, “which will likely provide a stiff headwind for 2019”, though Roche Chief Executive Severin Schwan assured on Thursday that he is confident growth will continue.
(Reporting by John Miller)