Thursday, Jul 13, 2000

Genentech CEO Says Amgen/TKT Trial Outcome Not a Bellwether for Biotech

Broader Issue of Gene Patents Addressed at Congressional Hearings This Week

South San Francisco, Calif. -- July 13, 2000 --

Art Levinson, chairman and chief executive officer of Genentech, Inc., today stated that the upcoming resolution of the patent dispute between Amgen, Inc. and Transkaryotics Therapies, Inc. (TKT) will not be a bellwether for the biotechnology industry. "We at Genentech strongly disagree with suggestions made recently by some that the outcome of this dispute, particularly if TKT should prevail, will inevitably and adversely affect the entire biotech industry," said Levinson. "We are concerned that the investment community and the public may have a mistaken perception about the consequences of the possible outcomes of this litigation for our industry."

Levinson explained that the issues being disputed are particular to these two companies and that few current or envisioned biotechnology products are vulnerable to the type of technology that TKT has used to make EPO. He further asserted that there are a number of products where several closely related, or even identical, forms of the same product are already on the market, or for which patent protection will soon be expiring, and that TKT's production technology provides no particular advantages for making those products. He added that many products on the market or in development are antibodies or fusion proteins, and TKT's technology cannot be used to produce these since the genes encoding these types of molecules do not typically occur in human cells.

He elaborated that for whatever remaining products might be produced using TKT's technology, particularly those drugs requiring large doses, it is not clear just how cost-effective this technology is compared to existing means of production. Lastly, Levinson stressed that TKT's technology is not likely to be useful with most new or more recently discovered biotechnology products because under the patent laws of the United States and other countries, the inventor of such a novel product should be entitled to patent protection covering the product itself, no matter how it is made. The patent situation for Amgen's EPO is different because EPO was known to exist and already had been studied by others at the time Amgen began to work on it.

Genentech Congressional Testimony Addresses Broader Patent Issues

Genentech also offered testimony at this week's congressional hearings about the future of gene patents and the Patent and Trademark Office's (PTO) proposed new guideline on utility.

"Patents are the lifeblood of the biotech industry and are crucial to spurring innovation and incenting companies to make the necessary significant investments to bring drugs to market," said Levinson. "We support the PTO's guideline on utility, which creates an appropriately higher bar for biotechnology companies in requiring demonstration of biological function and use. We believe that this is the surest way to provide important incentives for the further pursuit of new innovative therapies by the biotechnology industry and to reward those that are successful in that pursuit."

Genentech, Inc. is a leading biotechnology company that discovers, develops, manufactures, and markets human pharmaceuticals for significant unmet medical needs. Fourteen of the currently approved biotechnology products stem from Genentech science. Genentech markets nine biotechnology products directly in the United States. The company has headquarters in South San Francisco, California, and is traded on the New York Stock Exchange under the symbol DNA.

# # #