Looking a Gift Horse in the Mouth – Why Would a Company Refuse a Patent Term Extension?
May 1, 2008On May 7, 2008, the U.S. Court of Appeals for the Federal Circuit is scheduled to hear oral argument in Lupin Ltd. v. Abbott Labs. This is a patent infringement action concerning U.S. Patent #4,935,507 (“the ‘507 patent”) with respect to Abbott’s antibiotic drug product OMNICEF (cefdinir) Oral Suspension, approved under New Drug Application (“NDA”) #50-749, and Lupin’s Abbreviated NDA (“ANDA”) for a generic version of the drug product. The case is on appeal from the U.S. District Court for the Eastern District of Virginia, which in June 2007 granted Lupin’s motion for summary judgment with respect to certain ‘507 patent claims. The case is interesting not because of the particular drug product at issue, but rather because of the effects a decision in favor of Abbott could have on the U.S. Patent and Trademark Office’s (“PTO’s”) policy of permitting multiple patent term extensions.
Under 35 U.S.C. § 156, certain patents covering products regulated by FDA are eligible for a Patent Term Extension (“PTE”) if patent life was lost during a period when the product was undergoing regulatory review. The “regulatory review period” is composed of a “testing phase” and a “review phase.” For drugs approved under the FDC Act, the “testing phase” begins on the effective date of an Investigational New Drug Application (“IND”), and ends on the date an NDA is submitted to FDA. The “review phase” is the period between the submission and approval of the NDA. A patent term may be extended for a period of time that is the sum of one-half of the time in the “testing phase,” plus all the time in the “review phase” (minus any of the “regulatory review period” that occurs prior to the patent grant). The “regulatory review period” must be reduced by any time that the applicant “did not act with due diligence.” The total (calculated) regulatory review period may not exceed 5 years, and the extended patent term may not exceed 14 years after the date of approval of the marketing application. The PTE statute also states (at 35 U.S.C. § 156(c)(4)) that “in no event shall more than one patent be extended . . . for the same regulatory review period for any product.”
PTO interprets 35 U.S.C. § 156(c)(4) to permit multiple PTEs under certain circumstances. Specifically, for a drug product covered by several patents PTO may extend a different patent for each NDA approved on the same first day (even when multiple NDAs share common “testing phase” and a “review phase” dates). That is, PTO considers each NDA “regulatory review period” to be distinct and for which a PTE is available. Of course, the difficulty in such cases is to obtain FDA approval for each NDA on the same first day, because the PTE statute states under 35 U.S.C. § 156(a)(5) that for the PTO to extend the term of a patent claiming a drug (or a use of the drug or a method of manufacturing a drug) from the original expiration date of the patent, the NDA must be for the first permitted commercial use of the drug.
The difficulty of obtaining FDA approval for multiple NDAs for the same drug on the same first day making a company eligible for multiple PTEs is borne out in the dearth of such precedents. Indeed, we are aware of only 3 such cases. This post concerns two of those cases. One case involves OMNICEF (the subject of the patent infringement litigation noted above), and the other case concerns MYCAMINE (micafungin sodium).
On December 4, 1997, FDA approved two NDAs for OMNICEF: NDA #50-739 for OMNICEF Tablets, and NDA #50-749 for OMNICEF Oral Suspension. Abbott applied for and was granted two PTEs based on these approvals – one for U.S. Patent #4,559,334 with respect to NDA #50-739, and one for the ‘507 patent with respect to NDA #50-749. The PTO’s decision to grant a PTE for the ‘507 patent extended the term of the patent by 1,213 days until December 4, 2011. The ‘507 patent was originally scheduled to expire on August 8, 2008.
On March 16, 2005, FDA approved two NDAs for Astellas’s MYCAMINE: NDA #21-506 for MYCAMINE for prophylaxis of Candida infections in patients undergoing hematopoietic stem cell transplantation, and NDA #21-754 for MYCAMINE for the treatment of esophageal candidiasis. Astellas (which licensed the product from Abbott) applied for two PTEs based on these approvals – one for either U.S. Patent #5,376,634 (“the ‘634 patent”), #6,265,536 (“the ‘536 patent”), or #6,107,458 (“the ‘458 patent”) for NDA #21-506, and one for either of these same patents for NDA #21-754. In December 2007, the PTO issued final determinations on the PTE applications, which state that “two patents are eligible for extension based on the regulatory review periods for Mycamine (micafungin sodium) in NDA 21-506 and 21-754.” In January 2008, Astellas received a PTE for the ‘458 patent with respect to NDA #21-506. Although Astellas was also eligible for a PTE with respect to NDA #21-754 for either the ‘634 patent or the ‘536 patent, the company decided not to elect a PTE for the second NDA and withdrew its PTE applications for these patents.
So why would a company turn down a PTE? We think such a decision might be related to the ongoing litigation in Lupin Ltd. v. Abbott Labs. concerning OMNICEF.
In October 2006, Lupin filed a complaint against Abbott in the U.S. District Court for the Eastern District of Virginia alleging that the ‘507 patent is invalid or not infringed by the company’s generic OMNICEF drug product. Count III of Lupin’s First Amended Complaint for Declaratory Judgment seeks a declaratory judgment of invalidity of the PTE for the ‘507 patent. Lupin argues that “[t]he issuance of two PTEs for regulatory review periods involving cefdinir as the active ingredient was not authorized under 35 U.S.C. § 156,” and requests that the court declare the ‘507 patent PTE invalid.
In early June 2007, Abbott and Lupin entered into an agreement concerning the ‘507 patent after the district court ruled in Lupin’s favor with respect to certain ‘507 patent claims. As part of a Stipulated Order of Dismissal, which incorporates the terms of the Abbott/Lupin agreement, Count III of Lupin’s First Amended Complaint for Declaratory Judgment concerning the PTE for the ‘507 patent was dismissed without prejudice. However, the Stipulated Order of Dismissal also states that Lupin “may re-assert Count III in accordance with the parties’ Agreement in the event that the Final Judgment based on the Court’s May 21, 2007 Order on claims 2-5 or on claim 1 with regard to the doctrine of equivalents is not affirmed, and is remanded, on appeal.” On June 14, 2007, the court granted Lupin’s motion for summary judgment with respect to the literal infringement of claims 2-5 of the ‘507 patent. Abbott appealed the case to the U.S. Court of Appeals for the Federal Circuit where it is pending.
If Abbott prevails in the Federal Circuit, then Lupin might once again challenge the validity of the PTE for the ‘507 patent. It seems reasonable to conclude that in order to avoid a future decision that could invalidate the PTO’s multiple PTE policy, Astellas and Abbott decided on a conservative approach with respect to MYCAMINE. That is, the companies apparently adopted the “a bird in the hand is worth two in the bush” approach and decided to take only one PTE instead of the two that were available.