Xoma Corp. scored its first victory in many months lateMonday, when a U.S. District Court jury ruled unanimously inits favor in its patent suit against Centocor Inc. over rivalantibody products to treat gram-negative sepsis.

The six-member jury found that Xoma's U.S. patent No.4,918,163 is valid, that Centocor infringed the patent bothliterally and under the doctrine of equivalence, and thatCentocor does not have an implied license to the patent.

In a written statement, Centocor said the verdict will notaffect the U.S. introduction of its Centoxin product. A Food andDrug Administration advisory committee in Septemberrecommended marketing approval for the drug, and the Malvern,Pa., company is building a U.S. marketing force.

The San Francisco court battle began in July. Since then,Xoma's stock has been buffeted by negative analyst commentson the efficacy of its E5 antibody and by an FDA announcementin September that it wasn't ready to act on Xoma's applicationfor marketing approval.

The decision "was a clean sweep for Xoma, which it richlydeserved," said Gerald Sobel, Xoma's lead counsel.

The next step in the case, a hearing before Judge Robert H.Schnacke to decide on relief for Xoma, hasn't been scheduled.

James E Wavle Jr., Centocor's president and chief executive,said: "The verdict is only the first step in this prolongedlitigation. We are examining the several options available to usas the litigation continues. Our own broad patent in the UnitedStates ... should leave no doubt as to the strong proprietaryposition we have built for Centoxin."

Centocor this month received a broad U.S. patent, No.5,057,598, for Centoxin. The company has declined tospeculate on whether its patent might cover E5.

There's a reasonable chance that Xoma's patent would benarrowed on appeal and Centocor would be found not toinfringe, said Montgomery Securities analyst Brandon Fradd,who expects Centoxin to reach the market late this year orearly next year. Centocor could then sue Xoma if the Berkeley,Calif., company is able to nurse E5 through the FDA tomarketing approval.

Steven Mendell, chairman and chief executive of Xoma, said hiscompany has been meeting regularly with the FDA and hasresponded to all questions posed by the advisory committee."The FDA hasn't asked us to do another clinical trial," Mendelltold BioWorld. "We don't know if there will have to be anotheradvisory committee meeting."

Stock of both companies closed up on Monday before the jury'sdecision. Centocor (NASDAQ:CNTO) rose $1.50 to $50.25. Xoma(NASDAQ:XOMA) gained $1 to $18.

-- Karen Bernstein BioWorld Staff

(c) 1997 American Health Consultants. All rights reserved.