US Nevada state judge denies Roche and Genentech motions to dismiss PDL BioPharma's royalties complaint

The Second Judicial District Court of US state Nevada ruled in favor of PD BioPharma (Nasdaq: PDLI) on two motions filed by Genentech and its parent company, Swiss drug major Roche (ROG: SIX), in PDL's royalty law suit related to a 2003 settlement agreement with Genentech. PDL’s stock rose 9.2% to $6.28 on the news yesterday.

The court denied Genentech and Roche's motion to dismiss four of PDL's five claims for relief and, further, denied Roche's separate motion to dismiss for lack of personal jurisdiction. The court dismissed one of PDL's claims that Genentech committed a bad-faith breach of the covenant of good faith and fair dealing stating that, based on the current state of the pleadings, no "special relationship" had been established between Genentech and PDL as required under Nevada law.

In August 2010, PDL received a letter from Genentech, on behalf of Roche and fellow Switzerland-based Novartis, asserting that Avastin (bevacizumab), Herceptin (trastuzumab), Lucentis (ranibizumab) and Xolair (omalizumab) - the Genentech Products - do not infringe the supplementary protection certificates (SPCs) granted to PDL by various countries in Europe for each of the Genentech products and seeking a response from PDL to these assertions.