Contract analysis

I. EXECUTIVE SUMMARY GenomeDx possesses two principal damages theories in this matter, which we expect to present as complementary but hierarchically ordered components of a comprehensive damages case. The primary theory is a claim for lost profits, which, as the preferred measure of damages under the Patent Act where the patent holder is also a competitor, seeks to place GenomeDx in the economic position it would ha

II. FACTUAL BACKGROUND RELEVANT TO DAMAGES A. The Parties and Their Products GenomeDx Therapeutics Inc. GenomeDx is a Delaware corporation headquartered at 4750 Torrey Pines Road, Suite 300, San Diego, California 92130. The company is a molecular diagnostics company focused on developing and commercializing genomic tests for cancer prognosis and treatment decision-making. GenomeDx is a portfolio company of Pinnacle B

III. LOST-PROFITS ANALYSIS (PRIMARY DAMAGES THEORY) A. Legal Standard

Section 284 of Title 35 of the United States Code provides that "[u]pon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer." The Supreme Court has long recognized that the Patent Act contemplates two alternative measures of compensatory damages: lost profits a

1. Demand for the Patented Product. The first Panduit factor—demand for the patented product—is readily satisfied here. There is strong and growing demand for genomic prognostic testing in prostate cancer following radical prostatectomy. The Decipher® test has become a standard-of-care tool in post-prostatectomy clinical decision-making, and its use is recommended or referenced in clinical practice guidelines issued

2. Absence of Acceptable Non-Infringing Substitutes. The second Panduit factor—the absence of acceptable non-infringing substitutes—is the most critical and most heavily contested element of the lost-profits analysis. It is here that Helios is most likely to mount a vigorous defense, and it is therefore essential that GenomeDx develop a robust evidentiary record on this issue. Two-Supplier Market Theory. GenomeDx wil

3. Manufacturing and Marketing Capability. The third Panduit factor—manufacturing and marketing capability to exploit the demand—is straightforward for GenomeDx. The company maintains a large-scale, CLIA-certified clinical laboratory and employs approximately 820 personnel, including approximately 340 laboratory and R&D staff. GenomeDx's laboratory infrastructure is designed for high-volume specimen processing, and t

4. Amount of Profit — Lost-Profits Calculation. The fourth Panduit factor requires quantification of the profits GenomeDx would have earned on the sales diverted by the infringement. The calculation proceeds as follows: Estimated Tests Diverted to Helios. Of Helios's approximately 8,400 ProstaSignal™ tests performed during the October 2024 through March 2025 period, we estimate that approximately 6,100 tests would ha

IV. REASONABLE-ROYALTY ANALYSIS (ALTERNATIVE DAMAGES THEORY) A. Legal Standard The reasonable royalty serves as the statutory floor of patent damages under Section 284 of the Patent Act, which provides that damages shall "in no event [be] less than a reasonable royalty for the use made of the invention by the infringer." 35 U.S.C. § 284. While GenomeDx's primary damages theory is lost profits, the reasonable-royalty

V. VERIDIAN LICENSE — DETAILED COMPARABILITY ANALYSIS The Veridian Molecular Labs license agreement is the cornerstone of GenomeDx's reasonable-royalty analysis. A detailed comparability assessment is essential both to establish the admissibility and relevance of the Veridian license as a benchmark and to justify the upward adjustments necessary to derive the hypothetical negotiation rate for the present infringement

VI. TWO-SUPPLIER MARKET ANALYSIS A. Market Definition The relevant market for purposes of the lost-profits analysis is genomic prognostic testing for prostate cancer post-radical prostatectomy in the United States. This market definition is carefully tailored to capture the specific competitive dynamic at issue—the diversion of test orders from GenomeDx's Decipher® test to Helios's ProstaSignal™ test. The key charact