(Reuters) – A U.S. appeals court on Wednesday dealt a major blow to Merck & Co Inc (MRK.N) as it upheld a ruling that threw out a $2.54 billion (£1.97 billion) jury verdict the drugmaker had won against Gilead Sciences Inc (GILD.O).

The U.S. Court of Appeals for the Federal Circuit upheld a Delaware judge’s determination that the Merck patent at issue in the case, which relates to hepatitis C treatment, was invalid.

Merck and Gilead representatives were not immediately reachable for comment.

In 2016, a jury returned a verdict that Gilead’s hepatitis C drugs Sovaldi and Harvoni infringed the patent, which Merck acquired when it bought Idenix Pharmaceuticals. Jurors determined that Gilead should pay $2.54 billion in damages, which was the largest verdict ever in a U.S. patent case.

But a judge in Delaware tossed the verdict in 2018, saying the Merck patent should not have been granted in the first place because it did not meet a requirement that it disclose how to make the treatment it covered without undue experimentation.

In Wednesday’s split decision, the appeals court said it agreed with that determination.


Reporting by Jan Wolfe; Editing by Susan Fenton and Marguerita Choy


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