AGA Medical Holdings Inc. (NSDQ:AGAM) agreed to pay $35 million to settle a patent dispute with Medtronic Inc. (NYSE:MDT) over its Amplatzer cardiac plug.
The agreement lays to rest a lawsuit filed in 2007 in the U.S. District Court for Northern California in which Medtronic accused its Minneapolis-based neighbor of infringing a trio of patents with its cardiac plug. The so-called "Jervis" patent family covers self‐expanding medical devices using a metal alloy such as nitinol that will expand to its original shape after deployment. The last of the patents is set to expire in 2018.
AGA Medical said the settlement, which will be paid out over four years with the final installment due in January 2014, covers existing products and any new devices it might develop using the technology. Medtronic said it will continue to license the widely-used patents until they’re all expired.
It’s the second win in the case for Medtronic, which won a $57 million judgment in August 2009 after a jury decision ended the first phase of the litigation. The jury ruled that AGA infringed two of the patents in the suit and ordered it to pay 11 percent royalties on the Amplatzer device until 2018.
Last week AGA Medical won Food & Drug Administration approval for a clinical trial of the Amplatzer in treating atrial fibrillation. The trial is intended to evaluate the safety and efficacy of the company’s Amplatzer cardiac plug in preventing blood clots in the heart that can lead to strokes.
