By Frances Bishopp

Based on a patent issued Wednesday covering the production of erythropoietin (EPO) from all non-urine sources, and on two other established patents that claim an EPO product and processes for making EPO, Amgen Inc. has filed a lawsuit against Transkaryotic Therapies Inc. and Hoechst Marion Roussel Inc. for patent infringement.

The suit, which seeks an injunction preventing the defendants from making, importing, using or selling EPO in the U.S., was filed simultaneously on the day Amgen received a product (composition of matter) patent for EPO, dated Aug. 20, 1996.

Transkaryotic Therapies' (TKT) process, titled "Gene Activation Technology," involves an approach to the large-scale production of therapeutic proteins that does not require the cloning of genes and their subsequent insertion into non-human cell lines. With the technology, the company claims it avoids using patented approaches to the production of proteins that use conventional genetic engineering.

In the complaint, Amgen claims TKT's EPO has the structure and biological activity of Amgen's EPO identified in Amgen's patents. "TKT's EPO product, like Amgen's, is not isolated from human urine and is not obtained from blood or some other natural source and, as such, is non-naturally occurring," the complaint states.

Amgen and TKT, of Cambridge, Mass., would not discuss the specifics of the suit.

Although Amgen could have challenged TKT's approach based on its previous EPO patents (process and DNA sequence), the new patent, said analyst Meirav Chovav, of Solomon Brothers Inc., of New York, will provide Amgen with even greater protection against the unauthorized sale of EPO, regardless of the method of production or the cell line used.

"It [the patent] will be a very strong defense against potential EPO competition," Chovav said. "It covers a 'non-naturally occurring erythropoietin glycoprotein product having the in vivo biological activity of causing bone marrow cells to increase production of reticulocytes of red blood cells and having glycosylation which differs from that of human urinary erythropoietin.'"

EPO, marketed by Amgen under the name of Epogen, is a glycoprotein hormone that regulates the level of red blood cells in circulation by stimulating their production, as needed, in the bone marrow.

EPO was introduced by Amgen, of Thousand Oaks, Calif., for patients with anemia who are on kidney dialysis. It is used to elevate and maintain red blood cell levels and eliminates the need for repeated blood transfusions. Amgen's sales figures for Epogen last year were approximately $1 billion.

Gene activation technology is based on the observation that nearly all human cells contain genes encoding commercially valuable proteins, but the genes are generally "turned off" in most cells. Unlike conventional protein production, gene activation bypasses the genetic "off switch" in the human cell with DNA sequences including an "on switch," which allows the gene to express the desired protein in its natural setting.

Tom Dietz, an analyst with Pacific Growth Equities, of San Francisco, said he believes TKT does not infringe on any of Amgen's claims. "In its new patent, Amgen teaches you how to isolate, purify, characterize an EPO gene and put it back into another cell for manufacturing," Dietz said. "All the language in their patents make it expressly clear that Amgen teaches something that is uniquely characterized by that."

Dietz explained that TKT's gene activation technology takes a normal human cell that has a normal EPO already present and turns that EPO on. The product that is made is a naturally occurring EPO. Amgen claims the EPO it makes is different than normal human urinary EPO, Dietz said.

EPO is secreted by kidney cells in healthy adults. However, EPO has never been isolated from human blood because it is present in only minuscule amounts. Some EPO collects in the urine, but has never been demonstrated to be therapeutically useful due to its scarceness and to the fact that enzymes in the urine degrade the molecule.

"There are no claims on erythropoietin itself," Dietz said, "with the exception of the patent that was issued last year to Amgen, which covers the composition of the recombinant EPO, not all recombinant EPOs, but only recombinant erythropoietin that has a different molecular weight and a different glycosylation pattern than normal urinary EPO."

"The key is they both manufacture it. You can't patent EPO because it has been around forever. TKT makes normal EPO by simply turning the EPO on," Dietz said. "Amgen teaches how to do cloning, how to make EPO by taking it out of one cell and placing it into another cell."

Chovav said TKT uses the exogenous pieces of the Amgen-patented EPO gene to facilitate the process of gene activation. "In our opinion," Chovav said, "TKT violates Amgen's DNA and protein patents. In addition, in order to generate a commercially feasible EPO-producing cell line, TKT amplifies the "new" recombinant genomic EPO DNA and creates extra chromosomal copies containing the recombinant EPO DNA."

Hoechst, of Frankfurt, Germany, entered into two collaborations with TKT in 1994 and 1995. A second protein has not been disclosed. TKT has received $42 million so far in deals that could be worth $125 million in license fees, equity investments, milestones and research funding. Hoechst is responsible for all worldwide development, manufacturing and marketing and would pay TKT royalties on sales.

Amgen, as of March 31, 1997, had $1 billion in cash on hand. Amgen's stock (NASDAQ:AMGN) closed Wednesday at $57, up $1.125. *