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More Trouble for Cepheid MRSA Test as Abaxis Sues for Patent Infringement

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This article, originally published on July 12, has been updated from a previous version to include a statement from Cepheid.

Point-of-care diagnostic firm Abaxis has sued Cepheid, alleging that its PCR-based blood test for methicillin-resistant Staphylococcus aureus infringes sample-prep patents owned by Abaxis, according to recently filed court documents.

In response, Cepheid has filed a counterclaim denying the alleged infringement and asking the court to find that Abaxis' patents are invalid.

The lawsuit adds to Cepheid’s recent woes regarding the test, which is called Xpert MRSA and runs on the company’s GeneXpert PCR platform.

Two weeks ago the Sunnyvale, Calif.-based firm said it was recalling all lots of the Xpert MRSA blood culture test because it was found to have been producing false-negative results (PCR Insider, 7/8/10).

In the patent infringement suit, filed June 28 in the US District Court for the Northern District of California, Union City, Calif.-based Abaxis alleges that Cepheid is infringing four US patents either directly or through discontinuing royalty payments related to a licensing agreement for the patents.

Specifically, Abaxis claims that Cepheid is infringing upon US Patent No. 5,413,732, “Reagent Compositions for Analytical Testing;” and No. 6,251,684 B1, “Dried Chemical Compositions,” because Cepheid “has been aware of the existence of the patent[s]” but “has discontinued paying royalties on the Xpert MRSA because it alleges that there is no longer any infringement.”

Further, Abaxis claims that it has “diligently sought information from Cepheid to evaluate these assertions,” and that to date Cepheid has not provided the requested information. “In addition, Cepheid has indicated its intent to impose limitations of unknown scope on Abaxis’ ability to obtain the true and correct information regarding Cepheid’s products,” Abaxis alleges in the suit.

Abaxis believes that the civil court process is “necessary to ensure that Abaxis obtains true and correct information about the Xpert MRSA product and how it is made;” and that such information is needed “to confirm Abaxis’ belief” that Xpert MRSA infringes on the ‘732 and ‘684 B1 patents.

In addition to the ‘732 and ‘684 B1 patents, Abaxis alleges that Cepheid is infringing on US Patent Nos. 5,624,597 and 5,776,563, also respectively entitled “Reagent Compositions for Analytical Testing” and “Dried Chemical Compositions,” because Cepheid is “making, using, selling, and/or offering for sale the Xpert MRSA product in the US.”

In response to Abaxis' lawsuit, Cepheid said in a statement this week that it has filed an answer and counterclaim denying Abaxis' allegations and asking the court to determine that it has paid all royalties due; is in full compliance with all the terms of its license; and that Abaxis' patents are invalid.

It is unclear when Cepheid licensed the specific aforementioned patents or what the terms of the agreement were. Neither company was immediately available to comment.

All four patents in question cover lyophilized reagent spheres and dried bead compositions for analyzing biological samples, in particular blood samples in centrifugal analyzers, according to their abstracts. In 2005, Abaxis announced that it had completed an agreement to license a portion of its patent portfolio covering lyophilization technology to Cepheid.

In its statement, Cepheid said that in 2005, it entered into "a royalty-bearing license agreement with Abaxis for certain patents relating to lyophilization technology. Since then, Cepheid has introduced an internally developed manufacturing process outside the scope of Abaxis' patents that has resulted in reduced royalty payments to Abaxis, although the company continues to pay royalties associated with certain other products."

In all four claims, Abaxis is claiming that the alleged infringement “has injured Abaxis and will cause irreparable injury and damage in the future” unless Cepheid is enjoined from infringing the patents.

Abaxis is seeking a judgment from the court that Cepheid is knowingly and willingly infringing the ‘732, ‘597, ‘563, and ‘684 B1 patents; that the patents are valid and enforceable; and that it receive triple damages, prejudgment interest, and attorney’s fees and expenses from Cepheid.

Abaxis supplies point-of-care blood analyzers to the medical veterinary markets. Its flagship technology platform, the Abaxis Laboratory System, consists of a compact, chemistry analyzer capable of electrolytes, blood gas, and immunoassays; a complete hematology analyzer; and a series of single-use plastic discs called reagent rotors to perform a fixed menu of tests on whole blood, serum, or plasma, according to the company’s website.