Pembrolizumab, a monoclonal antibody marketed under the brand name Keytruda®, was Merck & Co’s highest-grossing product in FY 2023 with sales of about 25 billion dollars. Being an immune checkpoint inhibitor, this top-selling cancer drug acts by binding to the programmer cell death protein 1 (PD-1) receptor and thus inhibits its interaction with programmed death ligands 1 (PD-1) and 2 (PD-2). This causes PD-1 pathway-mediated inhibition of anti-tumor immune response. Merck & Co. protected Pembrolizumab (MK-3475) by filing for a US patent – US8354509 in June 2008. On September 4, 2014, the company also gained regulatory approval for the intravenous injection of Keytruda® from the US FDA. Spanning across 17 types of cancers, Keytruda® is mainly prescribed to treat melanoma, head and neck cancer, hepatocellular carcinoma, Merkel cell carcinoma, gastric cancer, cervical cancer, esophageal carcinoma, endometrial cancer, squamous cell carcinoma, hepatocellular carcinoma, breast cancer, and biliary tract tumor.

In connection to the biologic, on 4 March 2024, Merck & Co. filed petitions (Table 1) for inter partes review against four Johns Hopkins University (JHU) patents. The company claims that these method of treatment patents employing Keytruda® are invalid since they can be anticipated and are obvious over existing art.

For the uninitiated, in 2012, JHU contacted Merck to conduct a clinical trial on the effectiveness of Pembrolizumab in treating cancer patients with malignancies that were microsatellite high (MSI-H) or mismatch repair deficient (dMMR). JHU had supplied a draft protocol for the research, which Merck was partially sponsoring in addition to supplying the medication. Overall, Merck contributed approximately 3.5 billion dollars to conduct the clinal study. Scientists from Merck made a number of changes to the protocol; in particular, Amy Meister of Merck informed JHU that a certain dosage form should be used for the trial. The suggestions from Merck’s scientists were considered by JHU.

The Pembro Contract, a formal written agreement for this cooperative research, was signed by JHU and Merck. The contract stated that Merck would have the sole option to obtain an exclusive worldwide license for all commercial purposes, that JHU and Merck would consult and agree upon the patent filing and prosecution strategy for all joint inventions, and that Merck would be free to use all study data and results generated during the course of the study for any lawful business purpose without having to pay JHU any additional fees.

However, JHU made an unexpected turn by starting to submit patent applications for the cooperative scientific partnership to the US Patent and Trademark Office (USPTO) without informing Merck. JHU was granted four US patents in 2021 and 2022 (Table 2). The Pembrolizumab patent specifications included a discussion of JHU and Merck’s joint research collaboration as well as the suggested dosage form for Keytruda® administration. However, Merck was not involved in the drafting of the patent applications, their prosecution, or the language used in the claims that defined the inventions.

Furthermore, without providing Merck with any information, JHU proceeded to provide licenses to two other companies rather than offering Merck an exclusive license. The two companies were Personal Genome Diagnostics (PGDx) and QIAGEN. According to PGDx, the patented technology has been included into several assays and will be added to other assays in the future as well. Additionally, it declared that it would hold sole sublicensing rights to the MSI detection technology until the middle of 2017, after which it will share those rights with another molecular diagnostics supplier.

QIAGEN declared that JHU has granted it a global license to use genetic biomarkers for evaluating MSI and MMR in all sample and cell types. Additionally, it said that the arrangement will enable it to market solutions for molecular testing. Rather than offering Merck any recognition, JHU requested that it pays hundreds of millions of dollars related to Keytruda® sales; however, Merck refused to comply with any of JHU’s demands.

In accordance with the terms of the Pembro contract, JHU was required to tell Merck of any inventions resulting from the protocol and research conducted jointly; however, JHU violated this obligation by failing to notify Merck of any patent filings resulting from the inventions. As was previously said, Merck had the only chance to secure an exclusive global license; nevertheless, that option was also forfeited as a result of JHU’s violation.

Thus, a disagreement arose in 2022 when Merck filed a complaint against JHU about these patent applications that it had filed.

In accordance with the terms of the Pembro Contract, Merck had requested the court to find that JHU had violated the agreement, grant damages, and rule that JHU was not permitted to use the Pembrolizumab patents against Merck. It also requested the court to rule that Merck’s production, use, sale, offer for sale, and/or importation of Keytruda® products does not violate any of JHU’s patent claims.

In response to Merck’s complaint, JHU provided a detailed account of its inventions, stating that they started years before Merck became involved and that many Keytruda® approvals were the consequence of the research partnership. This results in a substantial profile for Merck, of which JHU is only claiming a small piece. It further stated that Merck withheld financing for the aforementioned study until the publication of preliminary findings.

In a recent turn of events, Merck has now taken the dispute from the court to US Patent and Trademark Office (USPTO). If the decision sways in the favour of Merck, it would signify a monumental victory for the pharmaceutical giant. Not only would Merck be relieved from the burden of paying royalty charges worth hundreds of millions of dollars to JHU but it would also lead to the early expiration of the patents granted to JHU which are otherwise set to expire in the second half of next decade. This outcome would be a game-changer for Merck, allowing it to regain full control over the profits from Keytruda®.

To offset Keytruda® patent loss, Merck on the other hand, has struck many multibillion-dollar acquisitions in recent years such as an $11 billion buyout of Acceleron in 2021, a $10.8 billion takeover of Prometheus Biosciences in 2023, and a very recent $680 million acquisition of Harpoon Therapeutics which have enabled the company to expand its product portfolio. Sotatercept, Tulisokibart, and HPN328 are the three new additions as a consequence of these deals.

Also, to counter potential competition from generic versions of Keytruda® after patent expiry in 2028, Merck is developing a more convenient, under-the-skin formulation of Keytruda® for which it is using Alteogen’s recombinant hyaluronidase-derived technology. This technology allows large-volume subcutaneous administration of biologics that would otherwise be administered intravenously. With such strategies in place, Merck expects to earn more than $35 billion in sales by 2035.