Shares in PDL Biopharma Inc (NASDAQ: PDLI) gained almost 3% in pre-market trading on Monday after drugs giant Merck & Co., Inc (NYSE:MRK) agreed to settle a patent infringement suit with the biopharma products marketer.
Under the terms of the deal, Merck will pay PDL a one-off lump sum of US$19.5mln to settle the suit which is related to Merck’s skin cancer treatment, Keytruda.
In return, PDL will grant Merck a “fully paid-up, royalty free, non-exclusive license” to certain patent rights related to Keytruda, while it has also agreed not to sue Merck for royalties relating to the cancer treatment.
“We are pleased to resolve this patent infringement lawsuit with Merck with a favorable monetary settlement to PDL as well as eliminating potential future litigation costs related to this matter for both parties,” said PDL’s president and chief executive John McLaughlin.
The stock was up 2.5% to US$2.07 in pre-market trading on Monday.