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US PTAB Invalidates Two More Halozyme PH20 Patents
Korea IR Council Forecasts Alteogen Operating Profit to Surge 131.4% to KRW 247.4 Billion
Merck & Co. (MSD) is strengthening its position in a high-stakes U.S. patent battle surrounding 'Keytruda SC,' an oncology drug that incorporates Alteogen's (196170) subcutaneous (SC) formulation technology. The U.S. Patent Trial and Appeal Board (PTAB) has issued additional invalidity rulings on two of Halozyme’s PH20-related patents, bringing the total number of patents ruled unpatentable to 11 out of 14 post-grant reviews (PGRs) filed by MSD. As the commercialization of Keytruda SC accelerates, Alteogen’s operating profit for the year is projected to more than double compared to the previous year.
Two More PH20 Patents Struck Down; Spotlight Shifts to Remaining Three Cases
According to records from the PTAB, an arm of the U.S. Patent and Trademark Office, the tribunal delivered Final Written Decisions on April 15 (local time) in cases PGR2025-00024 and PGR2025-00030 filed by MSD against Halozyme, finding all challenged claims unpatentable.
The rulings targeted U.S. Patent Nos. 12,060,590 and 12,054,758. Both patents relate to variants of the hyaluronidase PH20 enzyme, which is utilized to convert intravenous therapeutics into subcutaneous injection formulations.
The '590 patent focuses on amino acid modifications at position 307 of the PH20 protein, while the '758 patent centers on mutations at position 317. The claims in both patents encompassed variants exhibiting at least 91% sequence identity to wild-type PH20.
MSD has argued that Halozyme sought broad patent protection across wide-ranging PH20 variants beyond specific amino acid substitutions without providing adequate written descriptions or enabling disclosures. Compliance with the written description and enablement requirements served as the primary points of contention in the earlier PGR proceedings as well.
The PTAB had previously found all challenged claims unpatentable across nine related Halozyme patents. With these latest two decisions, the tally of invalidated patents has risen to 11. Final written decisions on the remaining three PGR challenges are expected by November.
Developments in Europe, however, have diverged. A Dutch court recently granted a preliminary injunction restricting local sales of Keytruda SC based on Halozyme's European patent rights. MSD intends to pursue further legal recourse against the Dutch ruling. With revocation proceedings ongoing in the UK and national courts reaching contrasting conclusions, cross-border outcomes in the dispute remain closely watched.
Keytruda SC Rollout Gains Steam; Operating Profit Projected at KRW 247.4 Billion
Even amid the patent litigation, the commercialization of Keytruda SC is directly translating into top- and bottom-line growth for Alteogen. MSD has commercialized Keytruda Qlex using Alteogen’s proprietary subcutaneous platform, 'ALT-B4,' and rising sales are expected to yield substantial milestone payments and royalties.
In a report titled "Alteogen: Shorter Injections, Longer Growth" published on April 16, the Korea IR Council Corporate Research Center projected Alteogen's full-year sales revenue at KRW 419.4 billion and operating profit at KRW 247.4 billion. These figures represent year-on-year increases of 94.3% and 131.4%, respectively, reflecting a projected operating margin of 59.0%.
"Alteogen has expanded its partner network through technology transfer agreements with global pharmaceutical majors including MSD, AstraZeneca, and Daiichi Sankyo, and the approval and commercialization of Keytruda Qlex have proven the platform’s commercial viability," said Kim Seung-jun, research fellow at the Korea IR Council Corporate Research Center.
Alteogen’s revenue structure is also pivoting away from upfront fees and development or regulatory milestones toward sales-based milestones and recurring royalties pegged to commercial volume. In the second half of the year, additional commercial milestones from Keytruda Qlex are expected to anchor financial growth. Profitability is set to widen further as high-margin royalty revenues expand without incurring significant incremental cost burdens, even as research and development expenses rise.
The application scope for ALT-B4 is likewise broadening from immuno-oncology to antibody-drug conjugates (ADCs). The platform is being deployed for Jemperli, clinical development is underway for an SC formulation of Enhertu, and multi-product licensing agreements struck with Biogen and Novartis are anticipated to further diversify income streams.
"As clinical achievements and new licensing deals for follow-on candidates accumulate, the platform's medium- to long-term earnings power will increasingly transcend that of any single product," Kim added.
