As we previously reported, Bristol-Myers Squibb Co. and Ono Pharmaceutical Company sued Merck & Co. in 2015 alleging that Merck’s sale of Keytruda® infringes a patent directed to the use of anti-PD-1 antibody to treat metastatic melanoma. Last week, the parties announced that they settled the litigation.  According to the parties’ press releases (available here and here), the settlement and license agreement obliges Merck to make an initial payment to BMS and Ono of $625 million, and to pay an ongoing royalty on Keytruda® sales of 6.5% through December 2023, and then 2.5% through December 2026. Bristol and Ono will divide the royalties in a 75%/25% allocation. The parties also report to have granted each other certain rights to their respective patent portfolios pertaining to PD-1.

Stay tuned to Big Molecule Watch for further coverage of biologics litigations.