Merck Sharp & Dohme (UK) Limited v Halozyme Inc

MR. JUSTICE RICHARDS :

1. This is an approved transcript of my oral judgment on some case management matters in a dispute between the claimant ( MSD ) and the defendant ( Halozyme ). Those are patent revocation and infringement proceedings with a high technical complexity. Fortunately, I do not need to go too much into the detail for the purposes of my judgment.

2. MSD seeks to invalidate two patents belonging to Halozyme ( EP 622 and EP 347 respectively and together the Patents ). The Patents relate to modified human PH20 hyaluronidase enzymes. Those enzymes break down hyaluronan in subcutaneous tissue. Such enzymes occur naturally, but the Patents relate to enzymes that have been modified by amino acid replacement to improve either stability in the presence of phenolic preservatives or to improve activity.

3. Claim 1 of EP 622 includes a functional feature consisting of “increased stability” in the presence of a phenolic preservative as compared with an unmodified PH20 polypeptide. Claim 1 of EP 347 includes a different functional feature consisting of “increased activity”.

4. Halozyme asserts that the Patents are valid and counterclaims that a subcutaneous version of MSD’s “Keytruda” product (the SC Product ) that MSD intends to make available to cancer patients in the UK, infringes those patents. The SC Product uses a PH20 hyaluronidase enzyme called Alt-B4 , which is manufactured by an unrelated third party not involved in these proceedings.

5. A central issue in the infringement claim is whether Alt-B4 exhibits the functional features set out in the claims to EP 622 and EP 347. Perhaps unsurprisingly, given that those functional features involve a claim of “increased” activity and stability, ultimately Halozyme intends to rely on evidence of experiments performed on the Alt-B4 product.

6. Two issues arise that are going to be dealt with in this judgment: i) the adequacy or otherwise of Halozyme’s statement of case on infringement that Mellor J ordered it to produce following a CMC on 10 October 2025; and ii) Halozyme needs a sample of Alt-B4 to perform its experiments. There is a dispute as to what if any order I should make requiring the provision of such a sample. THE STATEMENT OF CASE ON INFRINGEMENT Background

7. At the CMC on 10 October 2025, Mellor J heard an application by MSD consisting of a Request for Further Information under CPR Part 18. That application was contested and ultimately Mellor J, rather than determining each aspect of that request, required Halozyme to serve a statement of case on infringement by 28 November 2025.

8. On 28 November 2025 Halozyme served a document (the SOCI ) which it contended complied with Mellor J’s order.

9. There was then a debate between solicitors about whether that SOCI was properly pleaded.

10. By letter of 9 December 2025, MSD asserted through its solicitors that the SOCI that had been served was deficient because, among other matters (i) it did not identify specific reference sequence comparators and (ii) did not identify “conditions for comparison in order to meet the Functional Features”.

11. On 12 December 2025, MSD applied for an unless order to the effect that Halozyme’s claim of infringement be struck out unless it provided a compliant SOCI by a particular date. MSD explained that it had made this application early with a view to securing an early court date for a hearing and the debate between solicitors continued. (Matters have moved on since that application. MSD no longer seeks a direction on “unless” terms and seeks, instead, an order that Halozyme serve a compliant SOCI by 28 January 2026.)

12. In inter-solicitor correspondence, Hogan Lovells, on behalf of MSD made the point that Halozyme must be able to provide the expansions to the SOCI sought because it must know how the SC Product was said to infringe the Patents as it had signed the statement of truth in its Particulars of Claim.

13. In paragraph 5 of a letter of 9 January 2026 ( Paragraph 5 ), Quinn Emanuel on behalf of Halozyme rejected “the challenges to our client’s honest belief in its allegations of infringement”. Quinn Emanuel wrote that the reasons for their bona fide belief in relation to EP 622 derived from experiments performed in proceedings in Germany (the German Experiments ). In relation to EP 347, their bona fide belief was expressed to come from “the fact that BHA contains several mutations which fall within claim 1 of EP 347 in conjunction with the activity data reported in EP347, Alteogen’s own patent filings which indicate that HP46 (i.e. BHA) has substantially enhanced activity compared to unmodified PH20, and your client’s own Confidential Document Production”.

14. That prompted Hogan Lovells to make what it termed Request A and Request B in a letter of 10 January 2026: i) Request A was that Halozyme “incorporate” Paragraph 5 into an amended statement of case on infringement. ii) Request B picked up on an assertion that Halozyme had made to the effect that any of SEQ ID Nos 3, 7 or 32-66 could be the relevant comparator for the purposes of establishing the functional features of both Patents. However, Halozyme had not specified which of these 37 possibilities was relevant in its SOCI. By Request B, Hogan Lovells requested that Halozyme state its case on infringement if “a product meets the Functional Features when compared against one unmodified polypeptide sequence chosen for testing from SEQ ID NOS: 3, 7 or 32-66, but fails when compared against any of the other sequences”.

15. On 9 January 2026, Halozyme served a draft amended pleading (the Draft Amended SOCI ) that accompanied the correspondence referred to in paragraph 13. MSD criticises the absence of a formal application by Halozyme to amend its pleading. However, I think ultimately the parties came to accept that for the purposes of today the question is whether the Draft Amended SOCI complies with Mellor J’s order. If it does, I should give permission to make the amendment and if it does not I should order Halozyme to try again. I will, therefore, judge the quality of compliance by reference to the Draft Amended SOCI. The Claims in the Patents

16. Determining whether the Draft Amended SOCI complies with Mellor J’s order requires an analysis of the claims of the Patents since the function of the Draft Amended SOCI is to set out a case that the SC Product infringes the functional features of the Patents having regard to those claims. This is not the point at which to make final conclusions on claim construction, and so a high-level analysis of the claims suffices.

17. Claim 1 of EP 622 requires the following: i) There is a PH20 polypeptide (the unmodified PH20 polypeptide ) that consists of the sequence of amino acids set forth in any of SEQ ID numbers 3, 7 or 32 to 66. ii) The unmodified PH20 polypeptide has been modified by means of an amino acid replacement to create a modified PH20 polypeptide . The amino acid replacement in question must be in a specified position or positions and an exclusion must not apply. iii) The modified PH20 polypeptide must exhibit increased stability in the presence of phenolic preservatives compared to the unmodified polypeptide. That increased stability must be manifested as increased hyaluronidase activity in the presence of a phenolic preservative compared to the unmodified PH20 polypeptides with the activity being compared “under the same conditions”.

18. Claim 1 of EP 347 follows a very similar architecture. A relevant difference with EP 622 is that the claim specifies that the modified PH20 polypeptide must exhibit specified increased activity that is at least 120% of the hyaluronidase activity compared to the unmodified PH20 polypeptide. Claim 1 of EP 347 contains no reference to “conditions”. What did Mellor J’s order require?

19. Mellor J ordered Halozyme to serve a “Statement of Case setting out its case on infringement of the functional features of EP 622 and EP 347”.

20. It is not enough to comply with that order that a document be served that is simply called a “statement of case on infringement”. Nor is it enough that it puts a case in a way that Halozyme wishes to put it. The document served must meet the objective requirements of a pleading. Both sides were content to apply by analogy the requirements applicable to particulars of claim in CPR 16.4(1)(a). Mellor J was, therefore, requiring the provision of a document that set out a concise statement of the facts on which Halozyme relies in support of its allegation of infringement of the functional features of the Patents. Those facts can be contrasted with evidence on which Halozyme proposes to rely in order to prove the facts.

21. Moreover, the statement of case on infringement that Mellor J ordered must, like any pleading, or amended pleading, “contain sufficient detail to enable the other party to understand the case that is being advanced” (see, for example, [12] of Moore-Bick LJ’s judgment in Habibsons Bank Ltd v Standard Chartered Bank (HK) Ltd [2011] QB 943 ). Does the Draft Amended SOCI comply with the requirements of Mellor J’s order?

22. I agree with MSD’s overall point that, viewed as a whole, the Draft Amended SOCI consists of little more than a recitation of the claims of the Patents and an assertion that the SC Product infringes the functional features of those Patents with virtually no factual assertions being made as to why the SC Product is said to infringe.

23. In my judgment, the Draft Amended SOCI does not comply with Mellor J’s order in two respects.

24. The first respect in which it does not comply is that, in relation to both EP 622 and EP 347, it does not identify the relevant comparator sequence (namely the sequence of amino acids set forth in SEQ ID No 3, 7 or 32-66 that forms the unmodified PH20 polypeptide).

25. I do not accept that specifying that relevant comparator sequence would involve Halozyme pleading evidence rather than facts. It is necessary to know the comparator sequence to identify whether the SC Product involves a modification to an unmodified PH20 polypeptide of the kind falling within the Claims to either Patent and so to assess whether the increased activity or the increased stability is present by comparison between the modified and unmodified PH20 polypeptides. Pleading those matters is not to provide evidence of infringement of the functional features. It is to set out the very case of infringement to which MSD is required to respond.

26. I am reassured in that conclusion by the fact that this point came up in the hearing before Mellor J. Mellor J asked the very pertinent question of Halozyme: "Why should you not identify which of the 37 sequences you rely on?" Mellor J gave Halozyme a generous amount of time, some six weeks, in order to prepare the SOCI. I do not consider that he would have given such a long time limit to prepare a document that was lacking in any detail on the relevant comparator sequence.

27. The second respect in which the Draft Amended SOCI does not comply is that, in relation to EP 622, it does not set out the relevant conditions, namely the conditions in which the “increased stability” is present. That is necessary to enable MSD to understand the case that is being made. Specifying those conditions, for example, enables MSD to consider whether the conditions specified are correct or appropriate. It enables MSD to consider whether the respective stability of the unmodified PH20 polypeptide and the modified PH20 polypeptide said to be relevant to the SC Product truly are being compared under the same conditions.

28. I do not accept that this is a matter for evidence on the perspectives of a skilled person. A statement of case on infringement should make assertions as to what the relevant conditions are . The skilled person might be able to explain what conditions a reader of EP 622 would have in mind. Halozyme may wish to prove that the conditions referred to in the SOCI are the “right ones” by reference to evidence of the perspective of the skilled person. However, in order for its case on infringement of the functional features in the SOCI to be comprehensible, Halozyme needs to make appropriate assertions about the relevant conditions.

29. Some confusion it seems to me has been introduced into this debate by the correspondence between solicitors to which I have referred. Halozyme appears to have interpreted Request A as involving MSD seeking an order that it plead the basis of its honest belief in its claim of infringement of the functional features. It regarded any such request as objectionable and outside the purpose of pleadings.

30. It seems to me that was a wrong turn in the debate. MSD’s point was not that Halozyme had to plead evidence of its honest belief. Rather, its point was that if the Paragraph 5 material was incorporated in the SOCI, that would deal with its concerns on the lack of articulation of Halozyme’s case. As I understand it, MSD’s concern, which I share, is that the Draft Amended SOCI does not include sufficient factual assertions on either the relevant comparator sequence or, in relation to EP 622, on the relevant “conditions” to explain its case on infringement of the functional features.

31. Request B also appears to have provoked something of a wrong turn in the debate. Halozyme took that to be raising a point on construction of the claims of the Patents. Perhaps in part it was. However, by raising this point, MSD’s solicitors were not departing from their earlier point, that it was necessary for the statement of case on infringement to plead the relevant comparator sequence and, in relation to EP 622, the relevant conditions.

32. Halozyme relies on the fact that at the hearing before Mellor J, Mellor J declined to order Halozyme to provide further information in the form of “Request 1” and “Request 2” as follows:

1. Set out all matters relied upon by Halozyme in support of the allegation that the SC Product has the EP 622 Functional Feature including precisely how the “increased stability” is alleged to be determined and measured.

2. Identify all documents relied upon by Halozyme in support of the allegation that the SC Product has the EP 622 Functional Feature.

33. I respectfully understand why Mellor J did not want to grant Request 1 and Request 2. However, Mellor J ordered a statement of case in infringement instead. The fact that he refused wide-ranging requests for information does not, in my judgment, excuse Halozyme from the requirement to plead the facts on which it relies in support of its case on infringement of the functional features. Put another way, Mellor J ordered the provision of a “statement of case on infringement” just like any other. Having refused Request 1 and Request 2, he did not modify that requirement so as to permit Halozyme to provide a slimmed-down document that omitted a statement of its case on any issue.

34. For those reasons I conclude that the Draft Amended SOCI does not comply with Mellor J’s order.

35. In arguing against that conclusion, Halozyme complained of “procedural unfairness”. It complained that it could have had no idea that it was being required to provide information on the relevant comparator sequence until that was articulated in MSD’s skeleton argument and, moreover, could only have realised that it needed to provide anything on “conditions” until Mr Waugh KC made his oral submissions on behalf of MSD. Halozyme says that it may not be able to provide any information on conditions until it is further advanced in its design of experiments.

36. I do not accept the complaint of procedural unfairness. The requirement to plead facts on the relevant comparator sequence and on conditions was, as I have explained, necessary in order to produce a document that answered to the definition of “statement of case on infringement” that Mellor J ordered. It was therefore an aspect of Mellor J’s order rather than an obligation that is newly imposed. Mellor J gave Halozyme some 6 weeks to produce a SOCI and a further two months have expired since the deadline Mellor J specified. Moreover, on 9 December 2025, Hogan Lovells explained their view that the SOCI as served was deficient because it failed to give information on the relevant comparator sequence or, in relation to EP 622, on “conditions”. The provision of samples

37. By Mellor J’s directions order of 10 October 2025, MSD was ordered to provide a sample of Alt-B4. No deadline was specified but MSD was required to provide material in such quantities and by such date as Halozyme may reasonably request. That obligation was imposed in context of a deadline for the provision of notice of experiments of 30 January 2026.

38. As the parties acknowledged at the CMC before Mellor J, some dialogue would be needed to provide Halozyme with the sample. While Halozyme needed the samples before it could conduct its experiments, the design of those experiments would depend on what the samples consisted of and their characteristics. Correspondence ensued between the parties’ solicitors.

39. MSD criticises Halozyme in that correspondence for being slow and not making the running in specifying what precise samples it needed. Halozyme also criticises MSD for slowness. I do not consider either party was at fault in this regard. A team effort was needed. MSD needed to give information on the characteristics of the samples and in light of that Halozyme had to decide what it needed. The correspondence continued in my view reasonably satisfactorily, if perhaps slightly slowly, until 18 December 2025, by which point there was agreement on what was to be provided by way of sample and where it was to be sent. The Christmas period then intervened.

40. In early January 2026 MSD said it was sending a smaller sample than had earlier been proposed. However, while registering that they had noticed that reduction, Halozyme’s solicitors said in a letter of 12 January 2026 that what was being offered was good enough.

41. It seems to be a letter of 13 January from MSD’s solicitors saying that, "Our client is in the process of shipping" that caused disquiet. Halozyme formed the view that "in the process of shipping" was not good enough and the sample should have been shipped already. It issued an application that day seeking an order requiring delivery of a sample and it issued that application without evidence to support it.

42. A few days later it became clear there was some hold up in obtaining export licences for the sample. While MSD says that it expects the export licences to be granted by 23 January 2026, it is not clear to me even following today’s hearing when those licences were applied for.

43. I am now today asked to make an order requiring the provision of the sample. In my judgment, it is appropriate to make an order requiring provision of the sample now, for the simple reason that events have rather moved on since Mellor J made his order. First of all, there is now clarity on what is required and where it needs to be sent. Secondly, the export licence issue has arisen, which makes it clear that it is not appropriate to impose an absolute obligation on MSD because it cannot guarantee that export licences will be granted since they are dependent on the actions of third parties. It is, therefore, appropriate to make it clear that MSD’s obligation is to use best endeavours.

44. Both sides criticise each other for the state of affairs that we find ourselves in today. I have dealt with the allegations of delay. I do not agree that either party has delayed unduly, or certainly neither party delayed more than the other, in the correspondence up to around 18 December 2025.

45. Subsequent to that, MSD accuses Halozyme of jumping the gun by making its application on 13 January 2026. Halozyme criticises MSD for not having applied for export licences earlier. Those allegations, in my judgment, have more force than the assertions of delay before Christmas. I do consider that Halozyme jumped the gun. I do consider that MSD could usefully have applied for export licences earlier than it did.

46. The application to provide samples should never, in my judgment, have required any judicial determination. It should have been sorted out between the parties, both of whom were behaving appropriately, even if at the margins, and with the benefit of hindsight, some criticisms could be made of both parties. MSD is, in my judgment, not seeking to stymie the provision of a sample.

47. In my judgment, much of the heat and light generated by this issue is in reality an overhead cost of this litigation. The sample needs to get to Halozyme, recognising that third party and government agencies are involved, and there are processes that both sides need to navigate to enable that to happen. I am, therefore, going to make an order requiring MSD to use best endeavours to provide the sample. However, I am not going to make any order in favour of either party for costs of the application for that order. I regard the costs of the debate on this issue as an overhead cost of the litigation that is, in reality, part of the necessary process of getting the sample to Halozyme. I conclude that the costs of this application should be costs in the case. JUDGMENT ON PERMISSION TO APPEAL

48. I am asked for permission to appeal on two grounds: first that I misconstrued Mellor J’s order and second that requiring Halozyme to provide details of the relevant comparator sequence and of the “conditions” relevant to EP 622 is procedurally unfair. I apply the test for a first appeal and ask whether there is either (i) a realistic as opposed to fanciful prospect of a successful appeal or (ii) some other compelling reason for the appeal to be heard.

49. I am going to refuse permission to appeal.

50. Mellor J’s order required the provision of a statement of case on infringement. My conclusion was that the Draft Amended SOCI did not answer to that description because it did not contain the concise statement of the facts relied upon which set out sufficient detail to enable MSD to understand the case being advanced. I consider that to involve an orthodox approach to the construction of Mellor J’s order and the requirements of a pleading. I am not satisfied that there is a sufficiently realistic prospect of challenging that conclusion to grant permission to appeal.

51. The assertion of procedural unfairness is dealt with above. I do not consider there to be a sufficient prospect of overturning that conclusion to warrant the grant of permission to appeal,

52. It is right that there should be an opportunity for Halozyme to take the matter up with the Court of Appeal before the deadline for compliance with my order. I will, therefore, not require Halozyme to serve what I consider to be a compliant SOCI until 4 February 2026 so that Halozyme has an opportunity to apply for a stay from the Court of Appeal. - - - - - - - - - - - - - -