Royalties payable even if patented technology is not infringed, says EU court judgement

7 July 2016

The Court of Justice of the European Union has judged that the beneficiary of a patent license must pay the agreed royalty even if it does not infringe on the patent technology.

Since the royalty constitutes the price to be paid to protect the licensee against any infringement proceedings and the licensee may at any point terminate the license agreement, the payment is due, according to Wednesday’s judgement.

This came in the case of US biotech Genentech, a subsidiary of Swiss pharma giant Roche (ROG: SIX), versus the German unit of French pharma major Sanofi (Euronext: SAN), which has been brought before the Court of Appeal in Paris.

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