When
BioNTech
agreed
to
acquire
rival
messenger
RNA
company
CureVac
in
a
$1.25
billion
stock
deal
earlier
this
summer,
some
financial
analysts
said
the
buyout
amounted
to
an
out-of-court
settlement
of
the
patent
litigation
between
the
two
companies.
As
the
acquisition
moves
closer
to
completion,
BioNTech
and
CureVac
have
reached
a
formal
settlement
of
the
patent
spat,
a
deal
that
brings
in
the
companies’
respective
partners,
Pfizer
and
GSK.
In
litigation
over
the
past
two
years,
CureVac
alleged
the
BioNTech
and
Pfizer
vaccine
for
Covid-19
infringed
CureVac
patents
based
on
its
more
than
two
decades
of
mRNA
research.
Under
terms
of
the
settlement
announced
Friday,
CureVac
will
grant
BioNTech
and
Pfizer
a
non-exclusive
license
to
make
and
sell
mRNA-based
Covid-19
and
influenza
products
for
the
U.S.
market.
This
license
will
expand
to
a
worldwide
license
when
BioNTech’s
acquisition
of
CureVac
closes.
Beyond
the
license,
BioNTech
will
pay
GSK
$370
million
plus
a
1%
royalty
on
U.S.
sales
of
licensed
products
starting
from
Jan.
1,
2025.
GSK
said
these
payments
are
due
to
the
company
under
its
existing
agreement
with
CureVac.
GSK
will
receive
$320
million
of
the
upfront
settlement
in
cash.
The
rest
will
be
accounted
for
as
a
$50
million
payment
from
GSK
to
CureVac,
which
CureVac
said
is
for
monetizing
a
portion
of
the
product
royalties
due
under
a
2024
license
agreement.
That
deal
gave
GSK
global
rights
to
an
avian
influenza
vaccine
candidate
stemming
from
their
partnership.
GSK
also
gained
all
rights
to
a
seasonal
influenza
vaccine
and
a
Covid-19
vaccine.
After
BioNTech’s
acquisition
of
CureVac
closes,
BioNTech
will
pay
GSK
another
$130
million
and
a
1%
royalty
on
rest-of-world
sales.
BioNTech
said
Pfizer
has
agreed
to
reimburse
it
for
$80
million
and
half
of
claimed
royalties
payable
to
GSK
for
sales
of
mRNA-based
Covid-19
products.
Closing
of
the
acquisition
will
also
trigger
a
$370
million
payment
from
BioNTech
to
CureVac
and
a
1%
royalty
on
sales.
GSK
and
CureVac
will
earn
royalties
from
Jan.
1,
2025,
onward.
BioNTech
and
CureVac
are
each
Germany-based
companies
that
began
their
mRNA
research
in
cancer.
The
Covid-19
pandemic
led
both
of
them
to
turn
their
focus
to
vaccines
for
the
novel
coronavirus.
Their
fortunes
diverged
from
there.
While
BioNTech
and
partner
Pfizer
went
on
to
develop
the
first
successfully
authorized
and
then
approved
mRNA
Covid-19
vaccine,
named
Comirnaty,
CureVac’s
efforts
fell
short
in
clinical
testing.
With
the
Comirnaty
revenue,
BioNTech
has
gone
on
to
build
a
diverse
pipeline,
including
a
broad
cancer
R&D
alliance
with
Bristol
Myers
Squibb
that
was
unveiled
in
June.
Meanwhile,
CureVac
returned
to
its
cancer
roots
without
a
partner
and
with
a
smaller
and
less
advanced
pipeline
compared
to
BioNTech.
Even
so,
CureVac
had
been
at
mRNA
research
for
longer
than
its
German
counterpart,
and
its
2022
suit
claimed
Comirnaty
infringed
several
key
CureVac
mRNA
patents.
While
CureVac
said
it
did
not
want
to
stop
production
and
distribution
of
the
BioNTech
and
Pfizer
vaccine,
its
suit
sought
“fair
compensation.”
The
acquisition
agreement
announced
in
June
came
after
key
court
rulings
in
Europe
upheld
the
validity
of
two
CureVac
patents.
Analysts
at
Leerink
Partners
noted
that
BioNTech
faced
the
risk
of
needing
to
pay
backdated
royalties
on
about
$32
billion
in
Comirnaty
sales.
The
settlement
spares
BioNTech
from
much
of
that
financial
burden.
The
parties
have
also
filed
paperwork
dismissing
the
patent
infringement
case
in
federal
court
in
Virginia.
The
settlement
releases
BioNTech
and
Pfizer
from
all
claims
that
they
infringed
the
work
by
CureVac
with
GSK.
That
release
will
apply
worldwide
following
the
close
of
the
acquisition.
BioNTech
said
the
settlement
does
not
constitute
an
admission
of
liability
with
respect
to
any
allegations
raised
by
CureVac
or
GSK,
which
the
company
expressly
denies.
However,
GSK
said
the
settlement
does
not
affect
its
enforcement
of
its
own
patents
against
Pfizer
and
BioNTech
in
the
U.S.
and
Europe.
“GSK
will
continue
with
its
litigation
against
BioNTech
and
Pfizer
for
infringement
of
GSK’s
patents,”
the
pharmaceutical
giant
said
in
a
separate
announcement.
The
acquisition
agreement
requires
shareholders
representing
at
least
80%
of
CureVac
stock
to
tender
their
shares.
In
June,
BioNTech
said
shareholders
representing
36.7%
of
CureVac
shares
have
agreed
to
tender
those
shares
and
vote
in
favor
of
the
agreement.
The
settlement
moves
the
deal
closer
to
the
number
of
shares
needed.
GSK
said
alongside
the
settlement
agreement,
it
has
entered
into
a
customary
tender
and
support
agreement
under
which
it
is
tendering
its
approximately
16.6
million
CureVac
shares
in
the
upcoming
offer,
which
represents
about
7.4%
of
outstanding
shares,
according
to
the
mRNA
company’s
annual
report.
The
acquisition
is
expected
to
close
by
the
end
of
this
year.
Photo:
artisteer,
Getty
Images
