The Everlasting Patent: Is it Hiding in Plain Sight in the 21st Century Cures Act?

By Kurt R. Karst –      

Nothing lasts forever in our mortal world, though some things try to come close: Wonka’s Everlasting Gobstoppers, The NeverEnding Story, Doctor Who, the Energizer Bunny . . . . and perhaps one day in the not too distant future, the Everlasting Patent will be added to the list.  What’s that you say?  A patent term is only 20 years from the filing date of the earliest U.S. application to which priority is claimed (excluding provisional applications).  While that’s generally true (minus any extensions, for example, a patent term extension under Title II of the Hatch-Waxman Amendments), there’s a provision buried in the nearly 400-page discussion draft of the 21st Century Cures Act that was released earlier this year (see our previous post here) that seems to create the possibility of essentially limitless term extensions for a patent (as a helpful reader pointed out to us). 

The provision at issue is in Section 1222 (titled “Capturing Lost Opportunities and Creating New Cures for Patients”) of Subtitle M (titled “Dormant Therapies”).  It states:

(C) EXTENSION OF PATENTS.—

    (i) IN GENERAL.—Unless the Director has notified the Secretary of a determination under subparagraph (B)(ii) [(concerning failure to provide documentation of waiver of patent rights)], for each patent identified in a submission pursuant to subparagraph (B)(i) [(concerning the listing of patents that may be reasonably construed to provide protection for the medicine)], and for each patent issuing based upon an application for patent so identified, the Director shall, within the 3-month period beginning on the date of the submission, extend the patent to expire at the end of the protection period for the dormant therapy, if the patent would otherwise expire before the end of the protection period.  If the Director has so notified the Secretary under subparagraph (B)(ii), the Director shall extend one such patent, selected by the sponsor, for the period that would have been applicable had an application for extension been filed under section 156 of title 35, United States Code, with respect to such patent.

    (ii) APPLICATION OF CERTAIN PROVISIONS.—During the period of an extension under clause (i)—

    (I) the rights under the patent shall be limited in the manner provided under section 156(b) of title 35, United States Code; and

    (II) the terms “product” and “approved product” in such section 156(b) shall be deemed to include forms of the active moiety of the dormant therapy and highly similar active moieties that might be approved or licensed by the Secretary based upon an application filed under section 505(b)(2) or 505(j) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(b)(2), (j)) or under section 351(k) of the Public Health Service Act (42 U.S.C. 262(k)) that references or otherwise relies upon the dormant therapy.

(D) INTERIM PATENT EXTENSIONS.—Notwithstanding any provision of title 35, United States Code, with respect to any patent listed (or patent issuing on an application listed) under subsection (b)(1) that would otherwise expire before the sponsor could make a submission under subparagraph (B), the Director, upon application of the patentee, shall grant to the patentee an interim extension of such patent, subject to the limitations in section 156(d)(5)(F) of such title 35, for such period as may be necessary to permit the sponsor to submit the listing under subparagraph (B) and, if the patent is therein listed, to extend the patent as provided under subparagraph (C).  The Director may require, for any patent extended under this subparagraph, that the sponsor of the dormant therapy to which the patent relates provide periodic certifications that development of the dormant therapy is continuing.  The Director may terminate any interim extension for which a required certification has not been made.

(E) NOTICE OF EXTENSION.—For each patent that is extended under this paragraph, the Director shall publish a notice of such extension and issue a certificate of extension described in section 156(e)(1) of title 35, United States Code.

(F) NOTICE OF WAIVER.—For each patent identified in a submission under subparagraph (B)(i), and each patent issuing based upon an application for patent so identified, that expires after the end of the protection period for the dormant therapy, the Director shall publish a notice that the patent is subject to the limited waiver of the right to enforce described in subsection (c)(1).

As we previously noted, Subtitle M is modeled after the Dormant Therapies Act of 2014 (S. 3004), which Senator Orrin Hatch (R-UT) introduced in December 2014.  A press release from Senator Hatch last year noted that the Dormant Therapies Act “will remove the ‘ticking patent clock’ conundrum that forces companies to prioritize research based on which compounds can be brought quickly to market.”  The Dormant Therapies Act is a redo of the Modernizing Our Drug & Diagnostics Evaluation and Regulatory Network Cures Act (“MODDERN Cures Act”), which was introduced in 2013 (H.R. 3116) and 2011 (H.R. 3497). 

Subtitle M would create a new guaranteed 15-year “protection period” for certain drug and biological products designated and approved as “dormant therapies” – that is, a “medicine [that] is being investigated or is intended to be investigated for an indication to address one or more unmet medical needs,” among other designation requirements.  Specifically, during the 15-year “protection period,” FDA would be prohibited from approving an ANDA, 505(b)(2) application, or 505(b)(1) NDA for a drug product containing the same active moiety as in the dormant therapy, and would be prohibited from licensing a Section 351(k) biosimilar or a Section 351(a) BLA for a biological product containing an “active moiety that is highly similar” to that of the dormant therapy, unless, in the case of a 505(b)(1) NDA or Section 351(a) BLA, “the information provided to support approval of such application is comparable in scope and extent . . . to the information provided to support approval of the application for the qualifying medicine . . . .”  That’s pretty significant protection; however, as part of the deal, companies must agree to waive certain patent rights.  But they get other patent rights as noted in the provisions quoted above. 

The removal of the “ticking patent clock” for dormant therapies Sentaor Hatch referred to in a press release may be more than what some in industry were expecting, but exactly what it says, leading to a patent that could go on, and on, and on.  Here’s how that would work under one reading of the proposed statutory text . . . . 

The choice and nature of the patent selected for extension is not limited to a patent on a new dormant therapy use of the drug or biologic.  The proposed statutory text could allow for extension of any patent reasonably related to the drug or biologic that has not expired (or that is the subject of an interim patent term extension) selected from a list of all patents on the product by the applicant.  That patent, once selected, would run until the expiration of the “protection period.”  That’s just 15 years, right?  But hold on . . . .

What if a sponsor obtains multiple dormant therapy designations and approvals for the same drug or biologic or a related product to which the same patent is reasonably related?  It certainly seems possible that the sponsor could select the same patent over and over again for extension.  This would result in cascading protection periods for a single patent – as well as “for each patent issuing based upon an application for patent so identified” –  that extend for decades, thus creating the everlasting patent.  Of course, the “fix” to this issue is to prohibit the same patent from being selected more than once.  But such a limitation is not in the proposed text.  Perhaps that issue will be addressed in version 2.0 of the 21st Century Cures Act, which is rumored to be in the works. 

Update:

We received a comment from one blog reader we thought deserved posting and that provides an alternative view of the proposed statutory change.  Enjoy.

A post in this blog dated 13 March 2015 entitled The Everlasting Patent: Is it Hiding in Plain Sight in the 21st Century Cures Act? offers an opinion on the 21st Century Cures Act discussion draft that the provisions of Sections 1221-1223 of Subtitle L (titled “Dormant Therapies”) could lead to “evergreening” of patents.  Specifically, the blog opined that multiple extensions of the same patent under this Act could lead to multiple exclusivity extensions for the same dormant therapy.  In fact, under the Act a dormant therapy can benefit from one and only one protection period which is measured from the first day of the first approved indication for a therapy and cannot be further extended.  As a result of this and other limitations in the Act, any such “evergreening” is impossible.  Unlike the “everlasting gobstopper” to which these provisions were referred in the earlier post, an applicant looking for exclusivity beyond the protection period will be met with Gene Wilder’s famous line from the same movie, “you get nothing, you lose, good day sir!”

Two particular provisions in this Act that ensure this result are:

• Section 1221(6)(A) measures the “protection period” from the date that FDA “first approves” the dormant therapy (DT) for “any indication”.  Similar to the “first licensure” limitation in the exclusivity provisions of the BPCIA, the exclusivity and patent extension resulting from any subsequent dormant therapy designation that an applicant attempts to apply to a previously-designated dormant therapy – or a dormant therapy with the same active moiety – could not possibly extend the overall 15 year period, because subsequent extensions for the same therapy or moiety would always relate back to the first approval date for any indication.
• In the case the same patent were ever to be extended a second time because a second DT were approved based upon a different active moiety, the Hatch-Waxman limitations on the enforcement of the patent during each of the extended patent terms would apply.  This is set out in section 4(e)(2)(C)(ii) of Section 1222.  The most critical limitation on extended terms is in 35 U.S.C. § 156(b)(1)(B), which would operate to limit a second extension to the uses approved on or after the FDA approval of the second DT, “in the case of a patent which claims a product, [the extension is] limited to any use approved for the product … on or after the expiration of the regulatory review period upon which the extension of the patent was based.”  The second extension of the patent would not afford rights to enforce the patent against the earlier-approved DT. 

Thus, for multiple extensions of the same patent under this Act, each such extension is exclusively forward-looking never covering a previously approved use for a drug or biologic.