A federal jury in San Jose, California on Tuesday issued a ruling in favor of pharmaceutical company Merck & Co. in a high-profile lawsuit against biologic drugmaker Gilead Sciences Inc. over patents for new drugs that effectively cure hepatitis C.

Merck accused that Gilead infringed the patents that it filed more than a decade ago through the use of sofosbuvir, the active ingredient used in two of Gilead's blockbuster hepatitis drugs Sovaldi and Harvoni, which were launched in 2012 and 2014 respectively.

According to court papers, Merck contacted Gilead in 2013 saying the use of sofosbuvir infringed its patents. Gilead, on the other hand said that Merck did not play a role in the discovery of sofosbuvir.

Gilead said that Merck only knocked on its door with the two patents only when the breakthrough potential for sofosbuvir became clear. A spokesperson for the company said that Gilead is disappointed with the jury's decision.

"Although we are disappointed by the jury's verdict today, there are a number of remaining issues to be decided by the jury and the judge," said Gilead spokeswoman Michele Rest.

Jersey-based Merck seeks billions in damages and royalties on Gilead's sale of Sovaldi and Harvoni hepatitis drugs. These drugs brought California-based Gilead $19.2 billion in 2015 alone or nearly two-thirds of its total revenue.

Bruce Genderson, a lawyer for Merck, said that the company seeks 10 percent royalty on sales Gilead made for 2014 and 2015 amounting to nearly $21 billion. It also seeks 10 percent royalty on Sovaldi and Harvoni going forward.

Prior to the approval of Gilead's drugs, Merck was the dominant producer of hepatitis treatments. The new drugs from Gilead and Merck as well as those from other rival drug companies have revolutionized the treatment of hepatitis C, which affects about 3 million Americans.

Compared with the older drugs that require a year of treatment, come with unwanted side effects and barely cure half of the patients, the new drugs are effective in 95 percent of the patients and only require as short as eight weeks of treatment.

The downside of these drugs, however, is the cost. Harvoni, for instance, can cost $94,000 for a 12-week regimen.

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