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CareDx Settles with Roche Over Allegations of Breach of Agreement

NEW YORK (GenomeWeb) – CareDx said after the close of the market on Wednesday that it has settled a dispute with Roche over a licensing agreement forged between the two firms in late 2004.

As part of a settlement reached on Sept. 11, CareDx will pay Roche more than $2.8 million for past royalties due between July 1, 2011 and June 30, 2014, it said in a document filed with the US Securities and Exchange Commission. In addition, CareDx will pay Roche royalties covering the period between July 1, 2014 and Sept. 30, 2017. The amounts of those royalties are to be determined.

The companies are releasing each other from further claims under the license agreement and are dismissing arbitration claims.

The dispute between CareDx and Roche stems from an agreement that they made in November 2004. In return for the rights to use Roche's PCR and quantitative real-time PCR in clinical laboratory services — including the use of the technologies for CareDx's AlloMap Molecular Expression Testing for potential heart transplant rejection — CareDx would pay royalties to Roche, the Brisbane, Calif.-based molecular diagnostics firm said in a Form 10-Q filed last month.

CareDx, formerly called XDx, disputed the royalty rate that Roche sought to charge under the terms of the deal and withheld payments of royalties pending a resolution. This past February, Roche filed a demand for arbitration with the American Arbitration Association, and sought a declaration that CareDx breached the licensing agreement and failed to report and pay royalties that were due to Roche associated with services provided to CareDx after July 1, 2011.

Roche had sought an estimated $3.5 million from CareDx.

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