Lonza, the US subsidiary of Swiss Lonza Group, holds the US patent (#5,073,376) for preparations containing L-Carnitine, an amino acid that has been shown to boost weight loss, build muscles mass and promote cardiovascular health. It is the exclusive distributor of L-Carnitine L-Tartrate, consisting of 68 percent L-Carnitine and 32 percent L-tartaric acid, in the United States.
The dispute dates back to March 2004, when Nutraceutical filed a declaratory judgment action against Lonza of non-infringement, invalidity and non-enforceability of the patent. It said that estimated sales of allegedly infringing product represented less than 0.4 per cent of fiscal 2003 net sales.
Nutraceutical's defensive move was met with a counterclaim from Lonza for infringement of its patent rights.
According to a statement issued by Lonza, the settlement, announced yesterday, was fuelled by Nutraceutical's desire to reduce its costs of litigation.
As well as agreeing to source all its L-Carnitine L-Tartrate requirements in the US from Lonza, Nutraceutical will pay an undisclosed sum to the patent holder.
It will, however, seek compensation for the settlement sum from companies that had previously supplied it with L-Carnitine L-Tartrate, some of which are said to have already agreed to contribute.