The Seventh Circuit decided last week in favor of the Wisconsin Alumni Research Foundation (“WARF”) in its licensing dispute with Xenon Pharmaceuticals.

As I stated in my Silicon Valley IP Licensing Blog posting on this case, I strongly agree with the outcome in this case and I view this decision as an affirmation of a licensor’s rights in an exclusive license of joint intellectual property.  Had the case been decided differently, I certainly would have had some practical concerns as an IP licensing attorney as to how exclusive licenses to joint intellectual property in collaborations should be drafted.

For another take on this case, you might want to check out PatentlyO, which did not really take a position on the outcome, but provided a little different commentary on the court’s decision.

While this case may not have any groundbreaking precedential value as an intellectual property decision, I think it provides some good practical lessons for anyone drafting or negotiating license and collaboration agreements in the biotech world, whether representing a corporation or working for a tech transfer office at a university, as well as for those who are actually executing the agreements once they are signed.  Clearly, some mistakes were made here that resulted in expensive litigation and will likely result in a costly damage award against Xenon as the loser.

The USPTO has upheld a key WARF stem cell patent, which as the California Biotech Law Blog reported in April 2007, is considered one of the most significant patents on stem cells.

According to Bill Novak, reporter for Madison.com:

The patent for the primate and human embryonic stem cell known as 913 was one of three under review by the patent office, following challenges brought by the New York-based Public Patent Foundation and the California-based Foundation for Taxpayer and Consumer Rights.

The 913 decision was the first in the review process, with the patent office also re-examining the patents by WARF for stem cells 780 and 806.

Novak reports that decisions are still pending on the two remaining patents under review: the 780 and 606 patents.  We will keep you posted on the status of those patents as we hear of any new developments.