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UPDATE 1-Alexion, PDL BioPharma settle patent dispute

Mon Jan 5, 2009 7:33am EST

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Jan 5 (Reuters) - Alexion Pharmaceuticals Inc (ALXN.O) confirmed that its genetic disorder drug Solaris used technology covered by one of PDL BioPharma Inc (PDLI.O) patents and entered into a $25-million licensing deal with PDL.

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Under the agreement, PDL gave Alexion a covenant not to sue in respect of other claims in the Queen patent portfolio, which allows Alexion to market Soliris for all indications under the Queen patents, the companies said in a joint statement.

PDL's Queen patents are related to the humanization of antibodies and the company earned $221.1 million in related royalty revenue in 2007. Alexion will not make any additional payments to PDL under the Queen patents related to Soliris sales for any indication, the companies said.

The license agreement also grants Alexion the right to take a royalty-bearing license to market additional Alexion humanized antibodies that may be covered by the Queen patents in the future.

Alexion will pay PDL a royalty of 4 percent of net sales of non-Soliris products. Alexion currently dervies all of its revenue from sales of Soliris, which treats genetic disorder paroxysmal nocturnal hemoglobinuria (PNH).

Alexion shares closed at $36.13 Friday, while PDL shares closed at $6.25 on Nasdaq. (Reporting by Jennifer Robin Raj in Bangalore; Editing by Amitha Rajan)

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