Novartis fights Roche in $210 mln U.S. dispute over licensing fees

ZURICH, June 29 (Reuters) - Novartis wants Roche to return $210 million after accusing its Swiss rival of inappropriately pocketing fees from a 16-year-old patent licensing agreement, according to a U.S. District Court lawsuit.

The dispute, launched by Novartis in a California state court but recently shifted to a federal court, stems from a 2005 deal requiring U.S.-based Chiron Corp. to make payments to Roche’s U.S. Genentech unit to use its intellectual property.

In 2006, Novartis bought Chiron, a maker of biological drugs and vaccines, and continued making the payments to Roche as it developed products like inflammation drug Ilaris, with revenue of roughly $900 million annually, and psoriasis drug Cosentyx, Novartis’s current top seller at around $4 billion annually.

“Novartis subsequently discovered that it mistakenly overpaid,” Novartis lawyers wrote in a heavily redacted complaint published last Thursday in the U.S. District Court in California.

“Genentech was aware or should have been aware that Novartis had overpaid ... to Genentech throughout the term of the Agreement,” Novartis lawyers wrote. “By mistake, Novartis overpaid ... to Genentech on its drug products, Ilaris and Cosentyx, to which Genentech was not entitled.”

Roche did not immediately respond to a request for comment about the lawsuit on Tuesday.

Since it discovered what it alleges is an overpayment, Novartis says it has been trying to get Roche to return the money, to no avail.

“Genentech has been unjustly enriched at Novartis’s expense,” Novartis lawyers wrote. (Reporting by John Miller Editing by Mark Potter)