Gov't sues biotech co Omrix for NIS 500m

The lawsuit claims the Johnson & Johnson owned company's biological sealant was discovered by an Israeli government employee.

The Israeli government has filed a NIS 500 million lawsuit with the Tel Aviv District Court against Omrix Biopharmaceuticals Ltd. and its founder Robert Taub for depriving the state from the rights to the company's biological sealant. The lawsuit was filed as part of the government's policy to protect and recover intellectual property rights and patents and to seek remedies for harm to state assets and the rule of law.

Omrix's biological sealant is a life-saving product produced from blood plasma to stop severe hemorrhaging and to induce clotting. The product was based on discoveries by Prof. Uri Martinowitz, a government employee at Sheba Medical Center Tel Hashomer. The rights to the product therefore belong to the state.

Omrix used Sheba Medical Center's research and other facilities to develop the biological sealant, and the state partly financed the research and the scientists involved. The state therefore claims that the technology underpinning the biological sealant is defined as a service under the Patent Law, and all rights to it belong to the State of Israel.

The government claims that Omrix and its head at the time, Robert Taub, acted to deprive the state of the rights and use of the technology without making any payment to the state. The government also claims that when Johnson & Johnson (NYSE: JNJ) unit Ethicon acquired Omrix for $438 million in 2008, most of the value of the deal was for the technology that Omrix and Taub stole from the state.

Published by Globes [online], Israel business news - - on December 22, 2009

© Copyright of Globes Publisher Itonut (1983) Ltd. 2009

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