AstraZeneca UK Limited v Tesaro Inc

AstraZeneca UK Limited v Tesaro Inc

The correct interpretation of the Licence Agreements is that Tesaro is only obliged to pay royalties on sales of niraparib for uses or treatments that fall within the scope of the claims of the Licensed Patents. The definition of 'Compound' aligns the scope of the licence and the royalty obligation with the scope of the patent claims. The absence of a mechanism for determining royalty-bearing sales does not alter this, and the interpretation avoids the risk of contravening the US patent misuse doctrine.

Parties
Claimant/respondent: AstraZeneca UK Limited; Defendant/appellant: Tesaro, Inc.
Jurisdiction
England and Wales
Judgment Date
11 October 2024
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal allowed
Legal Topics
Patent Licensing, Royalty Obligations, Contract Interpretation, Patent Misuse Doctrine
Intellectual Property Contract Law Patent Licensing Royalty Obligations Contract Interpretation Patent Misuse Doctrine

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Parties

AstraZeneca UK Limited

Claimant/respondent

Tesaro, Inc.

Defendant/appellant

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 Proper interpretation of royalty obligations under patent sub-licences between AstraZeneca and Tesaro
  2. 2 Whether royalties are payable on all sales of niraparib or only those falling within the scope of the licensed patent claims

Ratio Decidendi

The correct interpretation of the Licence Agreements is that Tesaro is only obliged to pay royalties on sales of niraparib for uses or treatments that fall within the scope of the claims of the Licensed Patents. The definition of 'Compound' aligns the scope of the licence and the royalty obligation with the scope of the patent claims. The absence of a mechanism for determining royalty-bearing sales does not alter this, and the interpretation avoids the risk of contravening the US patent misuse doctrine.

Court Disposition

Appeal allowed

Orders

  • The appeal is allowed. The interpretation of the Licence Agreements is as per Tesaro's construction: royalties are only payable on sales of niraparib for uses or treatments falling within the scope of the Licensed Patents.