Osteotech settles with Medtronic over bone dowels
This article was originally published in Clinica
Osteotech has settled a patent infringement lawsuit with Medtronic in order to avoid substantial legal fees and the potential award of damages against it. It will pay Medtronic $1.9 million over two years and will stop making and selling its bio-d bone dowel by January 31 2003. Separately, Osteotech is selling its PolyActive patents to tissue engineering company IsoTis for $1 million.
Eatontown, New Jersey-based Osteotech made its decision over the litigation following a ruling that found that it infringed Medtronic's 038 patent. The ruling held that Osteotech did not infringe the 253 patent and questioned facts relating to the 437 patent. Medtronic sued Osteotech in July 1999, alleging certain instruments and patents for Osteotech's bio-d product infringed Medtronic patents.
As part of the settlement, Medtronic has agreed not to participate in another patent infringement case, filed by the University Florida Tissue Bank, Regeneration Technologies (RTI) and Sofamor Danek (a Medtronic company), against Osteotech. The case alleges that the bio-d infringes patents owned by the University of Florida or RTI and licensed to Medtronic.
In addition, Medtronic will not fund any of the parties in this litigation. The company has also agreed to recommend that RTI accept similar terms to those currently agreed with Osteotech. This case is scheduled for September 2002.
Richard Bauer, Osteotech's CEO said it could accept the terms since surgeons were moving away from cylindrical dowels towards bio-implants. 2001 sales of its threaded cortical bone dowels were flat, while total bio-implant sales rose by 225%, he added.
Osteotech has been involved with IsoTis since June 1997, when it licensed its technology to the Dutch company, with the option to buy the patents, now exercised. The proceeds from the sale will help cushion the impact of the litigation settlement, Osteotech says.