Amgen Lawsuit Over Its Patents Is Heating Up.

AN Amgen Inc. lawyer testified before a federal judge last week that the company's application for a patent covering its top-selling anemia drug Epogen was based on the "best information" available at the time.

Michael Borun, under questioning by an attorney for rival drugmaker Transkaryotic Therapies Inc., denied knowingly providing patent examiners with false information.

"It's not false," Borun testified, in a testy exchange with Transkaryotic's lawyer, Herbert Scwartz. "It's the information we had at the time."

Thousand Oaks-based Amgen, the world's largest biotechnology company, is suing to block Transkaryotic from selling its own version of Epogen, a drug used to stimulate red-blood cell production in kidney dialysis patients who become anemic.

Transkaryotic contends Amgen's patents on Epogen should not be enforced because they were obtained through what's legally known as inequitable conduct, by intentionally withholding highly material information. This argument is among the key defenses that Transkaryotic has raised in response to Amgen's patent-infringement allegations.

Borun, an outside patent lawyer for Amgen who helped prepare the company's applications for patents on Epogen, testified via a television hook-up before U.S. District Judge William Young, who will decide die case. Borun lives in the Chicago area and was unavailable to fly to Boston to testify in person.

Drugmakers, investors and patent attorneys have been monitoring the trial closely since it began in May -- and not just because it involves a drug with estimated U.S. sales in 2000 of $4 billion.

Young's ruling, and any later appeals court decisions, could shape the biotechnology industry for years to come, experts say. Should Young decide for Transkaryotic, it would clear the way for up-and-corning gene therapy companies to challenge the established pharmaceutical companies' dominance, patent experts say.

The case has broad implications because, it could help determine how far drug companies can go in using patents to control competition, experts say.

Amgen claims Transkaryotic and Aventis SA predecessor Hoechst Marion Roussel Inc. infringed on five of its patents by developing their own version of erythropoietin Transkaryotic contends it didn't infringe Amgen's patents because it used an entirely different method to develop erythropoietin.

While Amgen inserts a cloned gene into an animal cell to make its product, Transkaryotic has developed a method of inserting a DNA sequence into a human cell.

If Transkaryotic prevails, analysts say, it could allow other companies to make competing versions of Amgen products, such as Neupogen, which is used to prevent infections in chemotherapy patients.

Paine Webber Inc. analyst Elise Wang said a loss of the case won't affect Amgen much in the long run, because it has a pipeline of profitable new drugs moving into the market.

In the short term, however, a Transkaryotic win could cause Amgen shares -- already weighed down by the case -- to plunge 20 percent to 25 percent, Wang said.

Transkaryotic has yet to put a product on the market. The company was sued in July by Genzyme Corp. for' allegedly infringing a patent for a drug that treats Fabry disease, a rare metabolic disorder.