Genentech says key patent rejected, may appeal

NEW YORK, Feb 25 (Reuters) - Genentech Inc (DNA.N: Quote, Profile, Research, Stock Buzz) said on Monday the U.S. Patent and Trademark Office has rejected the validity of a key patent that governs the biotechnology company's method of producing some of its drugs.

Genentech, which also receives revenue under licensing agreements covering other companies' medicines that utilize the technology, said it would file a response to the action and, if necessary, appeal the decision to the Board of Appeals within the Patent Office.

The company said the patent, known as the Cabilly patent, remains valid and enforceable through the appeals process, which it anticipates could take one to two years, or longer.

The patent involves the method of producing antibodies and antibody fragments, a crucial step in the manufacture of biotechnology drugs. (Reporting by Bill Berkrot; Editing by Braden Reddall)