SAN FRANCISCO—In 2013, Medivation Inc., a San Francisco-based pharmaceutical firm, “woke up” to find it was competing with Johnson & Johnson.
That’s how the company’s lawyer described the effect of his client’s dispute with UCLA chemistry professor Michael Jung over the rightful ownership of chemical compounds used to treat prostate cancer.
The fraud trial came to a close on Thursday with dueling arguments over whether Jung lived up to his responsibilities under a funded-research agreement with Medivation that resulted in a lucrative prostate cancer treatment, Xtandi.
Medivation accuses Jung of breaching that agreement and a stock option agreement by concealing compounds from his lab’s research in order to personally profit. He ultimately helped launch a competing company, Aragon Pharmaceuticals Inc., which sold its therapy to Johnson & Johnson in August for $1 billion in cash and contingency payments.
“That’s a nightmare and it happened because of Jung’s fraud,” said Medivation lawyer James Lynch, a partner at Latham & Watkins.
Jung’s lawyers at Crowell & Moring countered that the suit was an aggressive attempt by Medivation to stifle all competition for Xtandi.
“We’re here because Medivation is greedy,” Crowell partner Gregory Call told jurors in his two-hour closing argument. “It wants a monopoly. It wants to control all the compounds.”
The University of California and Medivation signed licensing and research agreements in 2005, which provided financial backing for Jung and another UCLA scientist to work on molecules to treat late-stage, treatment-resistant prostate cancers.
Under the agreements, Medivation would fund the university’s research in exchange for the right to license promising molecules. Ultimately, Medivation chose to commercialize one of the 180 compounds developed at UCLA.
In its suit, the company claims Jung helped conceal two related molecules that should have been disclosed. The Regents filed a patent application for those compounds in 2007, and licensed rights to Aragon in 2009.
Call consistently argued that his client’s main obligation was to his employer, the UC Regents, not to Medivation, absolving him of duties to that company.
Lynch gave the rebuttal argument for Medivation. In the company’s closing, Latham partner Max Grant told jurors that Jung repeatedly lied about his lab work, telling Medivation that compounds didn’t exist when they did. Grant used multiple slides with “Lies” in big print to identify the alleged misrepresentations. Addressing Call’s defense, he said that Jung duped UCLA into licensing the other compounds to Aragon.
Although the discussions of the chemistry at issue in the suit—down to nitrogen and carbon atoms—were sometimes hard to follow, Grant’s message to the jury was clear: Jung was motivated by profit, not science.
“The focus was a monetary focus,” Grant said. “It wasn’t all about the science.”
Judge John Munter, who presided over the three-week jury trial, dismissed Medivation’s claims against the UC Regents and Aragon last year. Medivation settled with Jung’s fellow UCLA researcher, Dr. Charles Sawyers, over similar allegations.
Grant ended his closings by revisiting testimony from USC cancer researcher David Quinn, who told the jury he heard Jung say at a UCLA lecture hall that he stole the compounds from Medivation.
“Michael Jung never got on the stand and denied what David Quinn said,” he said. “Quinn’s testimony that Jung said he stole it is un-rebutted.”
Addressing that testimony, Call said Jung had been joking.
“Dr. Quinn tried to tell you that [Jung] stole something … He couldn’t steal it. UCLA owned it,” Call said.
In addition to emphasizing Jung’s duty to UCLA, not the private research sponsor, Call attacked Medivation’s claims that Jung had damaged the company.
Jung’s research launched the company, argued Call, who said multiple times that the company was last valued at $3 billion.
“They’re going to get billions of dollars—billions of dollars,” said Call. “Medivation suffered no harm.”
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