Orange Book Blog

At the intersection of Patent and FDA Law

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  • Federal Circuit Affirms Invalidity of Lilly’s Gemzar Patent for Obviousness-Type Double Patenting

    Sun Pharm. Indus. v. Eli Lilly & Co., No. 2010-1105 (Fed. Cir. 2010)

    The principle behind the doctrine of double patenting is simple:  a person may not obtain two patents on the same invention.  The doctrine "is intended to prevent a patentee from obtaining a timewise extension of [a] patent for the same invention or an obvious modification thereof."

    The two patents at issue in this case are U.S. Patent No. 4,808,614 and 5,464,826.  Both are listed in the Orange Book with respect to Lilly's drug Gemzar (gemcitabine), a nucleoside analog used for the treatment of cancer.  The '614 patent claims gemcitabine, as well as a method of using gemcitabine for treating viral infections.  The '826 patent claims a method of using gemcitabine for treating cancer.  The '614 patent issued on February 28, 1989 and expired on May 15, 2010 (Lilly chose the '614 patent for a patent term extension under 35 USC 156), while the '614 patent issued on November 7, 1995 and will expire on November 7, 2012 — two-and-a-half years after the expiration of the '614 patent.

    In August 2009, the U.S. District Court for the Eastern District of Michigan granted Sun's motion for partial summary judgment that the asserted claims of the later-expiring '826 patent are invalid for obviousness-type double patenting over the earlier-expiring '614 patent.  The court found that given the '614 patent's disclosure of gemcitabine's anticancer use, claim 12 of the earlier '614 patent, which claims gemcitabine, and claims 2, 6 and 7 of the later '826 patent, which claim a method of using gemcitabine for cancer treatment, are not patentably distinct.

    In an opinion released earlier today, the Federal Circuit affirmed the district court's decision of invalidity, and in doing so affirmed its prior holding of Pfizer v. Teva (Fed. Cir. 2008) and Geneva v. GlaxoSmithKline (Fed. Cir. 2003):  "a claim to a method of using a composition is not patentably distinct from an earlier claim to the identical composition in a patent disclosing the identical use."  The Federal Circuit stated, "In both cases, we found claims of a later patent invalid for obviousness-type double patenting where an earlier patent claimed a compound, disclosing its utility in the specification, and the later patent claimed a method of using the compound for a use described in the specification of the earlier patent."

    According to the Federal Circuit opinion, Lilly attempted to distinguish Pfizer and Geneva by contending "that in both cases, the specification of the earlier patent disclosed a single use for the claimed compound, which was an essential part of the patented invention and thus necessary to patentability."  By contrast, here, "the specification of the earlier '614 patent disclosed gemcitabine's use in treating both viral infections and cancer, [but] the antiviral use provided the essential utility necessary to the patentability of the '614 patent's claim to gemcitabine."  In other words, because the antiviral use was the key use in the earlier patent, the cancer use claimed in the later patent should be upheld.

    The Federal Circuit, however, disagreed with Lilly's characterization of Pfizer, stating that in that case, "the earlier patent's specification unambiguously disclosed more than one utility for the claimed compound."  In addition, the court explained that Lilly's proposed "single, essential utility test" would be "unworkable," because "where an earlier patent specification describes multiple uses for a compound, a court would be unable to identify the one use that was 'essential' or 'necessary' to patentability."  According to the court, Lilly's counsel conceded this point at oral argument.

    In a press release today, Lilly's general counsel stated that Lilly "strongly disagrees" with the Federal Circuit's ruling and "will consider all possible legal options," including a petition for rehearing.

    RELATED READING:

  • D.C. District Court Sides With FDA/Hospira/Teva, Against Sanofi-Aventis, in Eloxatin Case

    Sanofi-Aventis, et al. v. Food and Drug Administration, et al., No. 09-1495 (D.D.C. 2010)

    The question in this case is "whether a vacatur entered by an appellate court overrides the terminating effect that the entry of district court judgment has on the thirty-month stay under the FDCA."  The answer is "no" — the thirty-month stay is not reinstated.  Sanofi-Aventis filed the case against the FDA last summer, amid a flurry of activity in its ANDA litigation over Eloxatin (oxaliplatin), a $1.4 billion/year cancer drug.  Here is an abbreviated timeline of that activity:

    • June 18, 2009:  New Jersey district court files Opinion granting Hospira's and Teva's motions for summary judgment of noninfringement of U.S. Patent No. 5,338,874, claiming optically pure oxaliplatin
    • June 30, 2009:  New Jersey district court enters Final Judgment
    • June 30, 2009:  Sanofi files notice of appeal, motion for stay pending appeal, and petition for writ of mandamus to vacate the district court's judgment with the Federal Circuit
    • July 10, 2009:  Federal Circuit files Order granting Sanofi's motion for stay, pending appeal
    • August 7, 2009:  FDA grants final approval of Hospira's ANDA for oxaliplatin
    • August 7, 2009:  FDA grants final approval of Teva's 505(b)(2) application for oxaliplatin
    • August 10, 2009:  Sanofi files emergency motion in Federal Circuit to enforce the July 10 Order granting stay
    • August 10, 2009:  Sanofi files suit against FDA in D.C. district court, seeking declaratory and injunctive relief requiring FDA to rescind final approval of applications for generic oxaliplatin, and a motion for temporary restraining order and preliminary injunction against FDA
    • August 11, 2009:  Federal Circuit files Order denying Sanofi's emergency motion
    • August 11, 2009:  D.C. district court denies Sanofi's motion for temporary restraining order and preliminary injunction (opinion here)
    • August 11, 2009:  Hospira announces launch of oxaliplatin; Teva announces launch of oxaliplatin shortly thereafter
    • August 13, 2009:  Federal Circuit files Order denying Sanofi's motion for panel or en banc review of its August 11 Order denying Sanofi's emergency motion
    • September 10, 2009:  Federal Circuit files Opinion vacating district court's June 20 final judgment of noninfringement and remanding to district court
    • September 14, 2009:  Sanofi files Motion for Summary Judgment in D.C. district court, seeking an injunction ordering FDA to rescind all final approvals of generic oxaliplatin products
    • April 1, 2010:  Hospira and Teva announce settlements of Eloxatin patent litigation with Sanofi
    • July 26, 2010:  D.C. district court files Opinion denying Sanofi's motion for summary judgment

    The relevant statute in this case provides that if, before the expiration of the automatic thirty-month stay in a Paragraph IV case, "the district court decides that the patent is invalid or not infringed . . . the [FDA] approval [of the generic drug application] shall be made effective on . . . the date on which the court enters judgment reflecting the decision."  In its summary judgment motion filed last September, Sanofi argued that FDA was wrong to conclude that a stayed judgment (which existed at the time FDA granted final approval to Hospira and Teva) is a "judgment" within the meaning of the statute.  The court disagreed.

    In denying Sanofi's motion, the court explained that when read in context, the statute is clear:

    In short, there are two ways the thirty-month stay can terminate prematurely.  The first — addressed in the "entry of judgment" provision — arises when the district court rules that the patent is invalid or not infringed. . . .  That scenario ends with the district court; there is no provision for what happens if the district court's judgment is appealed.  The other scenario occurs when the district court determines that the patent is valid and infringed, the judgment is appealed and the court of appeals reverses the district court judgment and determines that the patent is invalid or not infringed . . . .  When viewed in context, the omission of a discussion of the appellate process in the entry of judgment provision is glaring.  Accordingly, the court takes this omission to be intentional and concludes that Congress intended the thirty-month stay to terminate upon the entry of judgment by a district court that a patent is invalid or not infringed without regard to the appellate process.

    The court concluded:

    Given that the entry of judgment provisions have a plain meaning, the court will not read into the statute any implication a vacated judgment might have on those provisions.  . . .  The court thus determines that plain language of the statute dictates that the thirty-month stay terminates upon entry of judgment by a district court that a patent is invalid or not infringed, regardless of any subsequent appeal, and that the FDA was bound to follow this directive.

    In view of the fact that Sanofi has settled its Eloxatin patent litigation, it is unclear whether Sanofi will appeal the decision to the D.C. Circuit.

    RELATED READING:

  • Apotex Establishes Declaratory Judgment Jurisdiction in Lipitor Patent Challenge, Threatening the Pfizer-Ranbaxy Settlement, but Pfizer Reloads

    Pfizer Inc. et al. v. Apotex Inc. et al., No. 08-7231 (N.D. Ill. 2010)

    The litigation between Pfizer and Apotex over Apotex's ANDA for a generic version of Lipitor (atorvastatin calcium) presents the fairly typical scenario of a later ANDA filer (Apotex) trying to trigger the 180-day exclusivity of the first filer (in this case, Ranbaxy).

    Pfizer and Ranbaxy settled their Lipitor ANDA litigation in 2008, agreeing that Ranbaxy would not market its generic version of Lipitor until November 30, 2011.  Later ANDA filers like Apotex, therefore, must wait until at least mid-2012 to launch their own generic Lipitor–unless one of them triggers Ranbaxy's exclusivity earlier.  In order to do so, the later filer must obtain a final decision of noninfringement or invalidity of the Lipitor patents.  But this isn't easy to do if the patent owner doesn't sue the later filer:  the later filer must obtain a declaratory judgment, which requires establishing declaratory judgement jurisdiction.

    In this case, Pfizer listed six patents in the Orange Book for Lipitor.  Apotex filed a Paragraph III certification on U.S. Patent No. 4,681,893 (expiring March 2010) and Paragraph IV certifications on the other five.  Pfizer sued Apotex on only two of the five challenged patents.  In its Answer, Apotex filed declaratory judgment counterclaims of noninfringement and invalidity of all five challenged patents, as it must have in order to trigger Ranbaxy's exclusivity.  Pfizer then filed a motion to dismiss Apotex's counterclaims with respect to the three patents that Pfizer did not assert against Apotex (the "Unasserted Patents"), on the grounds that they did not present a "case" or "controversy" as required by Article III of the Constitution.  In an Opinion and Order filed June 30, the district court denied Pfizer's motion, allowing Apotex's declaratory judgment counterclaims–and its attempt to trigger Ranbaxy's exclusivity–to proceed.

    In its motion to dismiss, Pfizer argued that Apotex lacked standing to assert its counterclaims.  To establish standing, a plaintiff must demonstrate (1) an injury-in-fact, (2) that is fairly traceable to the defendant's conduct, and (3) that can be redressed by the court.  Apotex alleged two injuries-in-fact:  first, by not suing on the Unasserted Patents while reserving the right to do so in the future, Pfizer created uncertainty as to Apotex's legal rights under its ANDA; second, by refusing to litigate all of its patents and settling its litigation with Ranbaxy, Pfizer erected a barrier to FDA approval of Apotex's product, thereby barring Apotex from entering the market.  Pfizer countered that Apotex's alleged injuries were "not sufficiently imminent in light of Apotex's Paragraph III certification to the '893 patent, which prevents the FDA from approving Apotex's ANDA until the '893 patent expires."

    Siding with Apotex, the court found that the facts of this case were more like those in Teva v. Novartis (where the Federal Circuit held that the "threat of litigation" on unasserted patents and the "legal undertainty" caused when a patent holder sues an ANDA filer on some but not all of Orange Book-listed patents create a justiciable controversy) and Caraco v. Forest (where the Federal Circuit held that blocking a generic drug company from selling a noninfringing product presents a justiciable controversy) than in Janssen v. Apotex (in which the Federal Circuit found no justiciable controversy because Apotex had stipulated to infringement and validity of one of the Orange Book-listed patents).

    On July 14, Pfizer filed a motion for reconsideration of the district court's June 30 decision.  In addition, today Pfizer filed a second motion to dismiss, arguing that the circumstances have changed in two important ways since the court's June 30 decision:  first, "in light of the Court's decision Pfizer has now given Apotex a covenant not to sue on the Formulation Patents [two of the three Unasserted Patents] and thus there is no possibility of a future lawsuit on these patents"; and second, "also in light of the Court's decision, Pfizer has brought a counter-counterclaim against Apotex on [the third Unasserted Patent, U.S. Patent No. 5,969,156], which expires, including pediatric exclusivity, in January 2017, after the expiration of the Formulation Patents and after the November 30, 2011 date that Ranbaxy may enter the market under its settlement with Pfizer."

    According to Pfizer, "the earlier-expiring Formulation Patents and the Ranbaxy settlement with its November 30, 2011 license date cannot prevent Apotex from overcoming Ranbaxy's 180-day exclusivity rights unless and until Apotex prevails on the '156 patent."  Thus, Pfizer argues that any alleged injury to Apotex is "based solely on the possibility that the '156 patent is not infringed or is invalid" and "such a speculative injury is 'conjectural' and 'hypothetical', and does not rise the level of 'concrete and actual or imminent'," as required to be justiciable.

    Of course, the longer the case lasts, the less likely Apotex is to obtain the declaratory judgment that it seeks, get the judgment affirmed by the Federal Circuit, and trigger Ranbaxy's exclusivity.  Pfizer might simply run out the clock.

    RELATED READING:

  • Federal Circuit Upholds Patent Term Extensions in LEVAQUIN and METVIXIA Cases

    Ortho-McNeil and Daiichi Sankyo v. Lupin, No. 2009-1362 (Fed. Cir. 2010)

    Photocure v. Kappos, No. 2009-1393 (Fed. Cir. 2010)

    In separate cases decided today, the Federal Circuit upheld two patent term extensions under 35 U.S.C. § 156–one relating to LEVAQUIN (levofloxacin) and the other relating to METVIXIA (methyl aminolevulinate).  The cases were argued on the same day last year to the same three-judge panel, and Judge Newman authored both of today's opinions.

    In the LEVAQUIN case, the Federal Circuit affirmed a district court decision sustaining the term extension of U.S. Patent No. 5,053,407, assigned to Daiichi and exclusively licensed to Ortho-McNeil, and enjoining Lupin from infringement during the extended term of the patent.  The '407 patent claims levofloxacin, which is the levorotatory enantiomer of racemate ofloxacin.  Levofloxacin and ofloxaxin are both antibiotics.

    In the METVIXIA case, the Federal Circuit affirmed a district court decision reversing the USPTO's denial of a term extension of U.S. Patent No. 6,034,267, owned by Photocure.  The '267 patent claims methyl aminolevulinate ("MAL"), the methyl ester of the known drug aminolevulinic acid ("ALA").  MAL and ALA are both indicated for the treatment of actinic keratoses–precancerous cell growths on the skin.

    Under § 156, the term of a patent that claims a drug product, a method of using a drug product, or a method of manufacturing a drug product may be extended by up to five years if the drug product was subject to FDA regulatory review prior to its commercial marketing or use.  The Federal Circuit explained the policy behind § 156:

    The Patent Term Extension statute was enacted in recognition of the lengthy procedures associated with regulatory review of a new drug product, for the patent term continues to run although the product cannot be sold or used until authorized by the Food and Drug Administration (FDA).  The statute was designed to restore a portion of the patent life lost during the period of regulatory review, in order to preserve the economic incentive for development of new therapeutic products.

    A key feature of § 156 is that only one patent term extension is allowed per "drug product".  This is reflected in the statutory language: "the permission for the commercial marketing or use of the [drug] product after such regulatory review period [must be] the first permitted commercial marketing or use of the [drug] product."  In turn, the statute defines a "drug product" as the "active ingredient" of a new drug, antibiotic drug or human biological product (as those terms are used in the Federal Food, Drug, and Cosmetic Act and the Public Health Service Act).

    The issue in both of the cases decided today was whether the FDA approval sought for each drug was for the "first permitted commercial marketing or use" of the drug.  In the levofloxacin case, Lupin argued that the enantiomer levofloxacin is an "active ingredient" of the previously-marketed racemate ofloxacin; levofloxacin is therefore the same "drug product" as ofloxacin; and therefore levofloxacin is not eligible for a patent term extension.  Similarly, in the MAL case, the PTO argued that "active ingredient" means "active moiety"; MAL, as the methyl ester of ALA, is the same product as ALA because the "underlying molecule" ("active moiety") of MAL is ALA; and therefore MAL is not eligible for a patent term extension.   But the Federal Circuit rejected these arguments.

    In the levofloxacin case, the court agreed with Ortho that "an enantiomer has consistently been recognized, by the FDA and the PTO, as a different 'drug product' from its racemate."  The court further observed that, in this case, "levofloxacin was viewed by the FDA as a new product requiring full regulatory approval, and that levofloxacin was viewed by the PTO as separately patentable."

    The Federal Circuit applied similar reasoning in the Photocure case:

    [A]s the '267 patent illustrates, the pharmacological properties of MAL differ from those of ALA, supporting the separate patentability of the MAL product.  MAL hydrochloride is a different chemical compound from ALA hydrochloride, and it is not disputed that they differ in their biological properties, warranting separate patenting and separate regulatory approval, although their chemical structure is similar.

    Notwithstanding this reasoning, the PTO argued that pursuant to Pfizer v. Dr. Reddy's, 359 F.3d 1361 (Fed. Cir. 2004), the statutory term "active ingredient" does not mean the compound that is present in the approved drug, but instead it means the "active moiety" of the compound; that is, the part responsible for the pharmacological properties.  The Federal Circuit, however, rejected the PTO's construction.  Further, the Federal Circuit distinguished the Pfizer case, stating: "Pfizer did not hold that [an] extension is not available when an existing product is substantively changed in a way that produces a new and separately patentable product having improved properties and requiring full FDA approval."

    Thus, after Photocure, we will likely see the PTO grant patent term extensions in cases where it would not have granted an extension before.

  • Orange Book Blog at BIO 2010

    The 2010 BIO International Convention is in Chicago this week and Orange Book Blog will be there covering it all.

    I'll be hanging out at the MBHB booth on Tuesday from 5-6:30 and Thursday from 3-5.  The rest of the time, I'll be meeting with clients, hearing talks from industry leaders, checking out the BIO Exhibition and BIOPark, and going to parties–including the MBHB reception at Fadó Irish Pub on Tuesday night.

    It would be great to meet any Orange Book Blog readers who will be at BIO this year.  If we don't bump into each other, send me an e-mail (barkoff@mbhb.com) to get together.

  • Federal Circuit Affirms Invalidity of Concerta Patent for Lack of Enablement

    ALZA Corp. v. Andrx Pharms., No. 2009-1350 (Fed. Cir. 2010)

    Earlier this week, the Federal Circuit affirmed a district court decision finding ALZA's U.S. Patent No. 6,919,373 invalid for lack of enablement.  The '373 patent claims methods for treating Attention Deficit and Hyperactivity Disorder ("ADHD") and is listed in the Orange Book for Concerta, an extended-release formulation of methylphenidate.

    Last year, following a bench trial held in late 2007, the U.S. District Court for the District of Delaware found the '373 patent not invalid for obviousness, but invalid for lack of enablement and also not infringed by Andrx's ANDA for a generic version of Concerta.  The Federal Circuit affirmed the lack-of-enablement finding, and therefore did not address the other issues.

    Claim 1 of the '373 patent reads:

    A method for treating ADD or ADHD comprising administering a dosage form comprising methylphenidate that provides a release of methylphenidate at an ascending release rate over an extended period of time.

    According to the Federal Circuit opinion, the specification of the '373 patent "focuses on how osmotic systems can be adapted to create an ascending release dosage form to treat ADHD.  The specification also mentions non-osmotic dosage forms."  Both Concerta and Andrx's product are non-osmotic dosage forms that contain an outer immediate-release coating around a sustained-release inner core.

    On appeal, ALZA argued that the district court erred in finding claim 1 invalid for lack of enablement on the grounds that the specification does not enable the full scope of claim 1, which covers both osmotic and non-osmotic dosage forms.  The parties agreed that osmotic dosage forms are enabled, but disputed whether the specification would have enabled a person of ordinary skill in the art to create non-osmotic oral dosage forms–namely, tablets and capsules–with ascending release rates without undue experimentation.

    The test of enablement is whether the specification would have taught someone having ordinary skill in the art, at the time of invention, how to make and use the full scope of the claimed invention without undue experimentation.  In the Wands case, the Federal Circuit set forth eight factors (the "Wands factors") that a court may consider when determining whether undue experimentation would have been required:

    (1) the quantity of experimentation necessary, (2) the amount of direction or guidance presented, (3) the presence or absence of working examples, (4) the nature of the invention, (5) the state of the prior art, (6) the relative skill of those in the art, (7) the predictability or unpredictability of the art, and (8) the breadth of the claims.

    ALZA asserted that creating non-osmotic dosage forms and manipulating their release rates were well known to a person of ordinary skill in the art at the time of invention.  In addition, ALZA argued that the specification provides sufficient guidance regarding non-osmotic dosage forms because "it identifies a variety of suitable non-osmotic dosage forms and cites to a portion of a standard text to explain how to make and use such non-osmotic, sustained-release dosage forms" with mere routine experimentation.

    Andrx disputed ALZA's contention that enablement can be satisfied by referring to what persons of ordinary skill in the art would know "because what one of the proper skill in the art knows cannot substitute for disclosure of novel aspects of the invention, i.e., the non-osmotic dosage forms exhibiting ascending release rates."  In addition, Andrx pointed to three Wands factors in particular–the sparse guidance provided by the specification, the absence of working embodiments, and the breadth of the claims–in support of its argument that creating non-osmotic dosage forms with ascending release rates would have required undue experimentation.

    The Federal Circuit rejected ALZA's first argument:

    To the extent that ALZA argues that the knowledge of a person of ordinary skill in the art satisfies the enablement requirement, we disagree.  As this court has repeatedly stated, "the rule that a specification need not disclose what is well known in the art is merely a rule of supplementation, not a substitute for a basic enabling disclosure."  Auto. Tech., 501 F.3d at 1282.

    The Federal Circuit next addressed ALZA's argument that the disclosure in the '373 patent specification enables a person of ordinary skill to make and use the claimed dosage forms.  According to the court, ALZA pointed to "ten lines of the specification, which mention non-osmotics and refer to a textbook discussing how to make and use various types of non-osmotic sustained-release dosage forms."  The court agreed with the district court that "this disclosure provides no guidance as to how to achieve ascending release with non-osmotic oral dosage forms."  The court again quoted the Auto. Tech. case:

    The omission of minor details does not cause a specification to fail to meet the enablement requirement.  However, when there is no disclosure of any specific starting material or of any of the conditions under which a process can be carried out, undue experimentation is required.

    The Federal Circuit concluded with a statement akin to "you've made your bed, now lie in it":

    As we stated in Liebel-Flarsheim . . ., "The irony of this situation is that Liebel successfully pressed to have its claims include a jacketless system, but, having won that battle, it then had to show that such a claim was fully enabled, a challenge it could not meet."  In this case, ALZA successfully argued to the district court that the claims encompassed both osmotic and non-osmotic dosage forms.  However, ALZA's patent specification does not enable the full scope of the claims, namely non-osmotic oral dosage forms with ascending release rates.

    ADDITIONAL READING:

  • Dr. Reddy’s Wins Attorney’s Fees from AstraZeneca in Prilosec OTC Case

    AstraZeneca v. Dr. Reddy's, No. 07–6790 (S.D.N.Y. 2010)

    After Dr. Reddy's filed an ANDA for Prilosec OTC (omeprazole), AstraZeneca filed suit, alleging infringement of U.S. Patent Nos. 5,690,960 and 5,900,424.  The patents claim omeprazole formuilations comprising a magnesium salt "having more than 70% crystallinity" and related processes of manufacture.

    In response, Dr. Reddy's provided independent test results purporting to show that their product did not infringe the patents and offered to produce samples for Astra to test, suggesting that this matter could be resolved quickly.  The district court subsequently required Dr. Reddy's to produce samples of their omeprazole product and ordered Astra to test those samples.  Astra’s tests confirmed that the Dr. Reddy's samples were less than 1% crystalline (essentially amorphous).  Dr. Reddy's then moved for summary judgment on the ground of noninfringement.

    But Astra pressed on, filing a request for additional discovery under Rule 56(f), arguing that further discovery was necessary to adequately access whether to maintain the suit.  Astra provided Dr. Reddy's and the court with proposed additional interrogatories, document requests and deposition requests, alleging that Dr. Reddy's may be manufacturing a crystalline product and then converting it into an amorphous form.  The court allowed limited discovery, requiring Dr. Reddy's to produce portions of their ANDA and DMF and to make available a witness with knowledge of Dr. Reddy's process for manufacturing omeprazole magnesium.  After completing discovery, Astra was unable to provide any evidence to the court's satisfaction that Dr. Reddy's product and process infringed the listed patents.  Nevertheless, Astra declined to withdraw its Complaint and instead requested a Markman hearing to construe the phrase "by addition of water."

    In March 2009, the district court ruled on summary judgment that there was "no evidence whatever that Dr. Reddy's makes or uses a salt with the requisite degree of crystallinity."  Late last year, the Federal Circuit affirmed the ruling without further opinion.

    Last month, the district court granted Dr. Reddy's motion for attorney's fees.  Analyzing a motion for attorney's fees is a two-step process:  (1) the court considers the "totality of the circumstance" in determining whether the case is exceptional under 35 U.S.C. § 285; (2) if found exceptional, the court determines whether granting attorney's fees is appropriate.

    In finding this case to be exceptional, the court weighed the "reasonableness" of Astra's decision not to withdraw the suit despite evidence from an independent source and Astra itself that Dr. Reddy's product did not infringe.  The court reasoned that "an inference of bad faith exists when a patentee is manifestly unreasonable in assessing infringement, while continuing to assert infringement in court."  The court thus concluded:

    [Astra] had an obligation not to file a lawsuit unless it had some evidence that Dr. Reddy's was in fact infringing.  The fact that a competitive product comes onto the market is not, without more, evidence of infringement.  Dr. Reddy's provided Astra with evidence of noninfringement prior to plaintiff’s filing suit.  Given the evidence in record before this court . . . I am hard pressed to see why the act of filing this lawsuit did not violate Fed. R. Civ. P. 11.

    The court reacted strongly to AstraZeneca's arguments against a finding of exceptional case:

    AstraZeneca insists that its litigation conduct here was appropriate because a lot of money was on the line.  That is a ridiculous claim to make.  Astra was not free to throw up roadblocks or to assert a claim construction in bad faith — to abuse the court system — just because it was to its economic advantage to keep a competitor out of the marketplace.

     

    AstraZeneca also argues that finding this case "exceptional" will "act to chill zealous advocacy by other litigants."  I certainly hope that this ruling chills the sort of unreasonable, frivolous, anti-competitive, anti-consumer litigation in which plaintiffs here engaged.  This lawsuit was nothing more than an effort to keep a legitimate competitor out of the market on flimsy-to-nonexistent grounds.  Plaintiffs did not engage in zealous advocacy here; they engaged in litigation misconduct.  They abused the litigation process and needlessly consumed the scarce time of the court.  A case in which such tactics are employed ought be deemed exceptional.

    The court further found that attorney's fees were appropriate, citing the "public’s interest in getting non-infringing generic drugs to the market without delay" and as a means to protect the courts "from patentees who maintain abusive and frivolous litigations."  The court concluded:

    It was obvious from very early on that plaintiffs had brought and were maintaining this lawsuit in a desperate effort to keep any competing product from hitting the shelves — even if the competing product was not an infringing product.  For choosing that bad faith business strategy, and for cluttering a busy court with work that should never have had to be done, [plaintiffs] should pay the full measure of the fees and expenses incurred by defendants in getting rid of AstraZeneca’s baseless lawsuit.

    ADDITIONAL READING:

  • District Court Declines to Stay Integrilin Case, Putting Teva At Risk of Forfeiting 180-Day Exclusivity

    Millenium Pharms. and Schering Corp. v. Teva, No. 09–105 (D. Del. 2010)

    Under the “failure to market” forfeiture provision, the first ANDA filer forfeits its exclusivity is it fails to market its ANDA product within 75 days of a Federal Circuit decision of patent invalidity or noninfringement.  See 21 U.S.C. 355(j)(5)(D)(i)(I)(bb)(AA).  This presents a dilemma to ANDA applicants who wish to file a Paragraph III certification on a patent that will not expire until far in the future—specifically, more than 75 days after a Federal Circuit decision would be reached.

    In this case, Teva filed an ANDA for generic versions of Integrilin (eptifibatide), an antiplatelet drug that is used to reduce the risk of acute cardiac ischemic events.  Teva’s ANDA included Paragraph III certifications to U.S. Patent Nos. 5,686,570 and 5,756,451, which expire in 2014; and Paragraph IV certifications to U.S. Patent Nos. 5,807,825, 5,747,447 and 5,968,902, which expire in 2015.

    Teva duly provided notice of its Paragarph IV certifications to Millenium and Schering, who last year responded by filing suit for infringing the ‘825, ‘447 and ‘902 patents under 35 U.S.C. 271(e)(2).  Last month, believing that the case will take roughly 2.5 years to litigate, and not wishing to forfeit its 180–day exclusivity, Teva filed a motion to stay the action until May 11, 2012 (2.5 years before the patents-in-suit will expire).  In its motion, Teva relied on last year’s decision by the Northern District of Illinois in Abbott v. Matrix, which granted a motion to stay in similar circumstances.

    Unfortunately for Teva, the District of Delaware saw things differently.  Last week, the court denied Teva’s motion.  According to the court:

    Given that Plaintiffs have demonstrated more than “a fair possibility” that they will be harmed by the entry of a stay, Defendants must show that they have a “clear case of hardship or inequity” in order to justify the granting of a stay.  Admittedly, Defendants have shown that they will be harmed if a stay is not entered, as they will likely forfeit their 180-day exclusivity period.  Defendants, however, have only themselves to blame for this result.  Defendants were aware of the statutory preconditions necessary for them to obtain the 180–day exclusivity period, and were aware of the potential that this could be forfeited given the timing of the filing of their ANDAs.  Although Defendants did not file this suit, they were well aware that their ANDA triggered the start of a 45-day period for Plaintiffs to defend the validity of their patents, and, in this sense, did control the timing of the present litigation.  Rather than wait until they could fully take advantage of their position as first filer, however, Defendants sought to prematurely reserve their place at the front of the line, and now seek an order from this Court that allows them to preserve that position.  This is not the type of hardship or balance of inequities that can appropriately convince this Court to issue a stay in the present proceedings.  Although Defendants may suffer a hardship, it is one of their own creation and, therefore, we do not think that it can outweigh the harm caused to Plaintiffs by granting this stay.

     ADDITIONAL READING:

  • Federal Circuit Vacates Injunction that Directed Novo Nordisk to Revise Patent Use Code for Prandin

    Novo Nordisk v. Caraco Pharm. Labs. et al., No. 2010-1001 (Fed. Cir. 2010)

    In the Medicare Modernization Act of 2003, Congress gave ANDA applicants who have been sued for patent infringement the statutory right to file a counterclaim seeking the delisting of the patent from the Orange Book:

    If an owner of the patent or the holder of the [NDA] for the drug that is claimed by the patent or a use of which is claimed by the patent brings a patent infringement action against the [ANDA] applicant, the applicant may assert a counterclaim seeking an order requiring the holder to correct or delete the patent information submitted by the holder . . . on the ground that the patent does not claim either—(aa) the drug for which the application was approved; or (bb) an approved method of using the drug.  21 USC 355(j)(5)(C)(ii).

    Pursuant to this provision, after Novo Nordisk sued Caraco for infringement of U.S. Patent No. 6,677,358 based on Caraco’s paragraph IV certification, Caraco filed a counterclaim requesting an order directing Novo to change the Orange Book patent use code for the ‘358 patent, and thereby “correct the patent information” for the ‘358 patent.

    Prandin (repaglinide) is FDA-approved for three uses:  (1) repaglinide by itself (i.e., monotherapy); (2) repaglinide in combination with metformin; and (3) repaglinide in combination with thiazolidinediones.  The ‘358 patent, which is the only patent listed in the Orange Book for Prandin, claims, “A method for treating non-insulin dependent diabetes mellitus (NIDDM) comprising administering to a patient in need of such treatment repaglinide in combination with metformin.”  Accordingly, the original patent use code for Prandin was “Use of repaglinide in combination with metformin to lower blood glucose.”

    Caraco’s ANDA contained a paragraph IV certification to the ‘358 patent and a section viii statement declaring that Caraco was not seeking approval for the repaglinide-metformin combination therapy.  Because there was no overlap between Caraco’s proposed carve-out label and the repaglinide-metformin use code, FDA accepted the proposed label.

    Thereafter, Novo changed the use code for the ‘358 patent to broaden it from the repaglinide-metformin combination therapy to “A method for improving glycemic control in adults with type 2 diabetes mellitus.”  The new use code covered all three approved uses for Prandin, even though the ‘358 patent covered only one approved use.  Caraco’s carve-out label now overlapped with the use code, and therefore FDA retracted its approval of Caraco’s proposed label and section viii statement.  As a result, Caraco’s current label now includes the repaglinide-metformin combination therapy, which is stipulated to infringe claim 4 of the ‘358 patent.  This prompted Caraco’s counterclaim seeking an order directing Novo to replace the new use code with the former listing.

    On September 24, 2009, the U.S. District Court for the Eastern District of Michigan ruled that Caraco was entitled to the requested injunction.  The court stated, “Novo, by the change in the use code narrative is attempting to extend the life of an expired patent”—namely, U.S. patent RE37,035, which broadly claims repaglinide.  According to the court, “the clear legislative intent behind the 2003 amendments to Hatch-Waxman that added the counterclaim provision, section 355(j)(5)(C)(ii), [was] to curb Orange Book abuses arising from misinformation regarding listed patents.”  The next day, the court issued an order granting the injunction sought by Caraco.

    On Wednesday, in a 2-1 decision—over a 28–page dissent from Judge Dyk—the Federal Circuit reversed and vacated the injunction.  The majority reasoned that the statutory language is clear on its face:  “an approved method of using the drug” means “any approved method” (as Novo urged) rather than “all approved methods” (as Caraco argued).  Further, according to the majority, its decision to vacate the injunction is consistent with the legislative intent:  the counterclaim provision in the 2003 Act “sought to correct the specific issue raised in Mylan v. Thompson (Fed. Cir. 2002), i.e., to deter pioneering manufacturers from listing patents that were not related at all to the patented product or method.”  In addition, the majority concluded that “the patent information” referred to in the counterclaim provision meant “the patent number and the expiration date”—not also the use code narrative.

    In dissent, Judge Dyk expressed strong disagreement with the majority.  He wrote:

    In 2003, Congress enacted the counterclaim provision of the Hatch-Waxman Act in order to prevent manipulative practices by patent holders with respect to the Orange Book listings.  These practices were designed to delay the onset of competition from generic drug manufacturers.  In my view, the majority, in reversing the district court, now construes the statute contrary to its manifest purpose and allows the same manipulative practices to continue in the context of method patents.

    Judge Clevenger, in a short concurring opinion, stated that, in his view, “Novo did nothing that was illegal or forbidden.”  He acknowledged that FDA “may have inadvertently upset the careful balance of interests represented by the efficient dispute resolution mechanism Congress created in the Hatch-Waxman Act.”  But, he concluded, “Congress is the appropriate entity to readjust, if necessary, the delicate balance it has struck between original drug manufacturers and their generic counterparts.”

    Perhaps Congress will "readjust" the Act–time will tell.  Caraco and Novo Nordisk have not yet commented on the Federal Circuit’s decision.

  • ACI “Paragraph IV Disputes” Conference, New York, April 27-28

    American Conference Institute’s 4th Annual “Paragraph IV Disputes" conference will take place in New York City on April 27–28.

    I am looking forward to speaking at the conference in a session entitled “Recent Decisions Impacting Paragraph IV Challenges and Motion Practice”.  My presentation will be about recent judicial decisions concerning declaratory judgment jurisdiction and method-of-treatment patents.

    A highlight of the conference will be a panel discussion with the Honorable Garrett E. Brown, Jr., U.S. District Judge; Honorable Joel A. Pisano, U.S. District Judge; and Honorable Tonianne Bongiovanni, U.S. Magistrate Judge.  All three have very active paragraph IV litigation dockets in the District of New Jersey.  Another highlight will be an FTC presentation on “pay for delay” settlements, by Markus H. Meier, Assistant Director of the Health Care Division, Bureau of Competition, Federal Trade Commission.  Mr. Meier will provide an update on FTC's activities to end such settlements.

    Other presentations include:

    • Pre-suit due diligence strategies in anticipation of the paragraph IV challenge
    • Assessing the ANDA applicant’s initial obligations
    • New takes on obviousness: pre-suit considerations for brand names and generics
    • Throwing down the gauntlet: the paragraph IV notice letter — delivery and receipt
    • Let the games begin: the start of the paragraph IV law suit — pleadings and considerations
    • Exploring exclusivity and forfeiture dilemmas relative to paragraph IV litigation
    • A closer look at generic v. generic lawsuits
    • Discovery strategies and pre-trial maneuvering tactics for brand names and generics
    • Assessing danger and mitigating liabilities associated with injunctions and “at-risk launches”

    In addition, a pre-conference workshop is offered on Monday, April 26, entitled “Hatch-Waxman Boot Camp — A Primer on IP Basics and Regulatory Fundamentals” and a post conference workshop is offered on Thursday, April 29, entitled “Master Class on Settling Paragraph IV Disputes: Brand-Name and Generic Perspectives”.

    Orange Book Blog readers may receive a substantial discount on registration fees with the “media partner discount”.

    For more information or to register, please visit the conference website.