INDIANAPOLIS (AP) - Two competing developers of drug-coated stents used to prop open coronary arteries after surgery said Tuesday they had settled a patent dispute and will team up in the emerging $3-billion-a-year market.
Guidant Corp. will assist Cordis Corp., a unit of Johnson & Johnson, to jointly promote Cordis' Cypher stent, speeding up Indianapolis-based Guidant's entry into a market in which it had been beaten by both Cordis and another rival, Boston Scientific Corp.
Cordis, meanwhile, will win access to Guidant's current and future technologies related to stents, including stent delivery systems. And Miami Lakes, Fla.-based Cordis will gain the right to join Guidant in its ongoing development of so-called bioabsorbable stents that are absorbed into the body. In September, Guidant announced a $35 million deal to acquire that technology.
The companies will both market and sell Cordis' Cypher stent, which each company covering its own marketing and sales expenses. The companies also will immediately start development and regulatory plans for a new Cypher stent. Stents are tiny metal scaffolds inserted in a heart artery to keep it open after a blockage has been cleared.
The deal "grants Guidant immediate entry into the U.S. drug-eluting stent market, which is expected to grow to more than $3 billion by year-end," Guidant said in a prepared statement.
The agreement, announced before markets opened Tuesday, resolves patent litigation which led a private arbitration panel last August to require Guidant to pay $425 million to Cordis. The panel determined that Guidant's Multi-Link Duet Coronary Stent System infringed on a key Cordis patent covering stents that have a tiny balloon inside to inflate the stent once it has been moved into place.
Guidant has been a market leader in recent years in sales of bare-metal stents, but sales of those models are declining with the introduction of next-generation stents coated with slow-release drugs to prevent scar tissue from forming new blockages. Guidant's own project to develop such stent has run into delays.
Guy J. Lebeau, who oversees Cordis operations for New Brunswick-based J&J, said each company brings "important strengths and expertise" that will provide immediate and long-term benefits."
Guidant president Ronald W. Dollens said, "This partnership leverages Cordis' and Guidant's broad capabilities and innovative positions in this important market," he said.
The announcement comes four days after Guidant and Boston Scientific announced they had resolved patent disputes and reached a cross-licensing agreement for some products.
