Fingolimod - USA

On Dec 07, 2018, Federal Circuit affirmed district court’s decision that obviousness-type double patenting does not invalidate an otherwise validly obtained PTE under § 156.

This case concerns the interplay between a patent term extension (PTE) granted pursuant to 35 U.S.C. § 156 and the obviousness-type double patenting doctrine. Ezra filed ANDA for Novartis’s branded multiple sclerosis drug Gilenya®. Novartis filed an infringement suit against Ezra in response, asserting certain claims of US 5,604,229 (claims fingolimod compound). Because the ’229 patent was filed before the effective date of the Uruguay Round Agreements Act of 1994 (URAA), its patent term is governed by the law in effect at that time—the rule of 17 years from issuance. The ’229 patent thus was set to expire on Feb. 18, 2014, but Novartis secured a PTE of five years on the patent pursuant to 35 U.S.C. § 156 & thus extended the expiry till Feb. 18, 2019. Novartis also owned another patent, US 6,004,565 (claims a method of administering fingolimod). Because the ’565 patent issued from a patent application filed after the effective date of the URAA, its term expired on Sep. 23, 2017—20 years from its earliest effective filing date. The ’229 patent is thus a pre-URAA patent whereas the ’565 patent is a post-URAA patent, governed by different statutory patent term regimes.

On Sep. 22, 2016, district court denied Ezra’s motion for judgment on the pleadings, where Ezra argued that the ’229 patent should be ruled invalid, or otherwise terminally disclaimed for the patent term past the expiration date of the unasserted ’565 patent. Specifically, Ezra argued that the granted extension of the ’229 patent’s term beyond the life of the ’565 patent is impermissible because it: (1) de facto also extends the life of the ’565 patent, and thereby violates § 156(c)(4)’s requirement that only “one patent be extended”; (2) violates the “bedrock principle” that the public may practice an expired patent; and (3) renders the ’229 patent invalid for statutory- and obviousness-type double patenting because Novartis’s ’229 patent claims are not patentably distinct from its ’565 patent claims. With respect to first point, the district court concluded that Ezra’s argument regarding the de facto extension of the ’565 patent required reading “effectively” into the statute as a modifier of “extended.” The district court found that such a reading did not make sense when compared to other uses of the word “extend” in the same statute, which the district court found to “refer to the legal status conferred upon a patent chosen to benefit from PTE.” Further, the district court relied on the decision of Merck, where federal circuit concluded that a terminally disclaimed patent could still have its term extended with a PTE because “Congress chose not to limit the availability of a patent term extension to a specific parent or continuation patent but instead chose a flexible approach which gave the patentee the choice.” Thus, the district court concluded that the ’229 patent’s term extension was permissible under § 156. With respect to second point, the district court explained that “expiration of a patent does not grant the public an affirmative right to practice a patent; it merely ends the term of the patentee’s right to exclude others from practicing the patent.” The district court then pointed to other ways in which the ’565 patent subject matter could still be blocked from public use, e.g., other patent rights or contractual obligations. With respect to third point, the district court found that a judgment on the pleadings was improper for Ezra’s double patenting challenge because the analysis included factual issues underlying a “construction of the claims in the earlier patent and later patent” and a “determination of whether differences between claims render them patentably distinct.” Thus, the district court found the ’229 patent valid, unexpired, and enforceable with the PTE, found infringement of the ’229 patent, and imposed an injunction on Ezra’s ANDA product until the expiration of the ’229 patent in 2019.

Ezra appealed on the issues of statutory construction of § 156 and obviousness-type double patenting. Ezra argued that Novartis violated § 156(c)(4) because, in its view, two patents were extended here: the extension of the ’229 patent’s term “effectively” extended the ’565 patent’s term as well, because the ’229 patent covers a compound necessary to practice the methods claimed by the ’565 patent. Federal circuit however, agreed with the district court, that there is no reason to read “effectively” as a modifier to “extend” in the language of § 156(c)(4).

Ezra also contended that in order to comply with § 156, “Novartis had to make a choice [as to which patent to extend] in such a way as to ensure that ‘in no event shall more than one’ patent be extended.” Federal circuit however, disagreed & said that there is nothing in the text, structure, or history of § 156 that imposes such a requirement on patent owners. Federal circuit further said that although § 156 recognizes that a patent owner may own multiple patents relating to a product, nothing in the statute restricts the patent owner’s choice for patent term extension. In striking a balance between the competing interests of new drug developers and low-cost generic competitors, Congress limited a PTE grant for such a patent owner to only one of its patents. Here, only the ’229 patent was selected and then legally extended with a certificate of extension. Therefore, as long as the requirements for a patent term extension recited in § 156(a) are met, the Director “shall” grant a PTE on the patent of patentee’s choice. Thus, federal circuit concluded that Novartis’s selection of its ’229 patent for term extension does not violate § 156(c)(4).

Federal circuit next addressed the question, whether the ’229 patent is invalid due to obviousness-type double patenting because the term extension it received causes the ’229 patent to expire after Novartis’s allegedly patentably indistinct ’565 patent. Relying on its decision in Merck & Co. v. Hi-Tech Pharmacal Co., federal circuit concluded that obviousness-type double patenting does not invalidate a validly obtained PTE in such a scenario. Federal circuit agreed with the district court’s observation that if a patent is terminally disclaimed to another patent to overcome an obviousness-type double patenting rejection and then term-extended under § 156 (as in Merck), it necessarily will expire after the patent to which it had been subject to an obviousness-type double patenting rejection.

With respect to Ezra’s policy concerns, federal circuit said that this case does not raise the traditional concern with obviousness-type double patenting of a patent owner “extending his exclusive rights to an invention through claims in a later-filed patent that are not patentably distinct from claims in the earlier filed patent.” Here, it is the earlier-filed, earlier issued ’229 patent, not the later-filed, later-issued ’565 patent, that has the later expiration date, due to a statutorily-allowed term extension under § 156. Also there is no potential gamesmanship issue through structuring of priority claims as identified in Gilead Sciences, Inc. v. Natco Pharma Ltd., 753 F.3d 1208 (Fed. Cir. 2014). This court prevented such an outcome by holding that expiration dates were what “really mattered” for an obviousness-type double patenting analysis in this context. Here, Ezra does not identify any similar tactics on the part of Novartis.

By applying statutory construction principles, following the precedent in Merck, and addressing traditional obviousness-type double patenting principles, federal circuit held that a PTE pursuant to § 156 is valid so long as the extended patent is otherwise valid without the extension. Thus, the district court was correct in finding that the ’565 patent is not a double patenting reference to the ’229 patent and that the ’229 patent is valid through the end of its PTE.