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Last Updated: Monday, 20 December 2004, 18:02 GMT
Biotech firm wins royalty fight
Cambridge Antibody Technology HQ
The market for monoclonal drugs could increase five-fold by 2010
UK biotech company Cambridge Antibody Technology (CAT) has won its court fight for bigger royalties from the sale of arthritis medicine Humira.

Abbott, which makes Humira under a CAT license, was wrong to deduct payments to help cover other companies' fees, the High Court has ruled.

CAT's royalties are now set to double to more than 5%.

Shares in CAT closed up 12.9% as analysts said the ruling was crucial to the Cambridge-based firm's future.

CAT is a world leader in monoclonal drugs - treatments based on antibodies, which generally have fewer side effects than conventional chemistry-based medicines.

Industry observers believe that the market for such products will rise more than five-fold to about $25bn (12.8bn) annually by 2010.

However, in common with other firms in the sector, CAT signed away future sales of its biggest drug hope in 1993, to secure funding and promotional help.

The loss-making firm has other products in development but Humira, with predicted sales of $2bn a year, is currently its only drug on the market.

Royalty boost

CAT chief executive Peter Chambre said the court win would allow the company to continue a research deal announced last month with Astra Zeneca to develop the next generation of anti-inflammatory drugs.

Abbott, which is to appeal the ruling, said the case would have no material impact on its finances.

Under a 1993 deal, CAT licensed Abbot to use CAT technology to develop Humira, which went on sale for the first time in 2003.

Abbott agreed to pay CAT royalties of more than 5% but argued it was entitled to charge CAT to cover some of the costs of third-party technology. CAT took Abbott to court claiming it was entitled to more than the 2% share of sales it had been receiving.

Mr Justice Laddie said "Abbot was in error" in the way it had calculated the royalty payments.

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