The Patent Troll Threat To Pharmaceutical Companies

In recent months patent litigation abuse by so-called “patent trolls” has gotten the attention of lawmakers, state attorneys general and even President Obama, who called for patent litigation reform during his State of the Union address. And, while the primary targets of such litigation abuse so far have been technology companies, a recent study cited in Law360 warns that in the absence of patent reform legislation, patent trolls will soon set their sights on bio-pharmaceutical companies. [Read more…]

Supreme Court Rejects Design Defect End-Around Of Pliva v Mensing Ruling

In the last week of the its 2012-13 term, the Supreme Court spurned the First Circuit’s attempt to circumvent the Court’s 2011 decision in PLIVA, Inc. v. Mensing, which immunized generic manufacturers from liability based on state “failure to warn” claims on federal preemption grounds.  In Mutual Pharmaceutical Co., Inc., v. Bartlett, the Court re-affirmed Mensing and ruled that design defect claims were also preempted, leaving consumers injured by generic drug products with no legal recourse . . . except for a possible “misbranding” claim against generic manufacturers or even a possible direct claim against the original pioneer manufacturer in some state courts. [Read more…]

Supreme Court Deals Blow To Reverse Payment Settlements

Yesterday, the Supreme Court ruled that “large unexplained” reverse payments in Hatch-Waxman litigation settlements, even if within the “scope of the patent,” are subject to antitrust attack.  In a long-awaited decision, the Court ruled 5-3 in Federal Trade Commission v. Actavis, Inc., et al., that so-called “pay-for-delay” settlement deals between pioneer drug manufacturers and their generic rivals are subject to antitrust “rule of reason” analysis, but stopped short of applying a “quick look” approach that assumes patent invalidity.  In so ruling, the Court threw open the litigation floodgates for plaintiffs’ lawyers of all stripes, made patent litigation settlements going forward less likely and more costly and may even discourage generic companies from challenging pioneer drug patents — defeating the very rationale for the ruling. [Read more…]

Amphastar’s Qui Tam Suit Against Aventis Shows Importance of Patents

In a recent ground-breaking qui tam ruling, a California federal court denied Aventis Pharma’s (a division of Sanofi-Aventis) efforts to dismiss costly and embarrassing False Claims Act (FCA) allegations brought by “whistleblower” and generic rival Amphastar Pharmaceuticals.  In its qui tam suit, Amphastar alleged that Aventis overcharged the Government by inflating prices of enoxaparin, more commonly known as Lovenox®, based on an “inequitable conduct” patent ruling from several years ago.  Although Amphastar’s suit may have been motivated by financial gain, vindictiveness or both, its theory that FCA liability can be predicated on branded drug sales where the drug’s underlying patent(s) have been invalidated is worrisome and could signal a new line of attack for a relator’s bar hungry for new avenues into big pharma’s deep pockets.  [Read more…]

U.K. Jumps on “Pay-to-Delay” Bandwagon

The U.K. Office of Fair Trading (“OFT”) jumped on the “pay-to-delay” bandwagon last week when it issued a “Statement of Objections,” indicating a potential future adverse decision against GlaxoSmithKline (“GSK”) and several generic rivals under the U.K. Competition Act of 1998 in connection with previous patent litigation settlements.  As part of the settlements, GSK made “reverse payments” to the generic companies, which agreed to a delayed entry of generic paroxetine (also known as Seroxat and Paxil) into the U.K. market.   The U.K.’s actions only increases the stakes for branded and generic drug manufacturers awaiting the Supreme Court’s decision (expected in June) on the legality of reverse payment patent litigation settlements under the U.S. antitrust laws. [Read more…]

Generics Demand Brand Drug Samples for ANDA Filings

Tensions between branded pharma companies and their generic competitors are boiling over into court battles over  the “right” of generics to demand, and the “right” of branded manufacturers to withhold, brand drug samples for generic bioequivalence testing, a precursor to an ANDA filing.  Free-market principles, antitrust law and the intent of the Hatch-Waxman Act are at the heart of litigation between Swiss drug manufacturer Actelion Pharmaceuticals and generic drug producers Apotex Inc. and Roxane Laboratories and a recently filed suit involving generic Accord Healthcare and branded Acorda Therapeutics.  The key questions posed in both cases is whether and to what extent can a branded drug company be forced to sell products to a generic competitor? [Read more…]

Pay for Delay and Drug Design Defect Cases Take Center Stage at Supreme Court

While the NCAA “March Madness” Tournament is always the lead sports story this time of year — did anybody out there watch Florida Gulf Coast College over the weekend?! –March can also provide a madness of sorts for high-profile Supreme Court arguments.  Last March, the Supreme Court set aside an unprecedented number of days for lengthy arguments over the constitutionality of President Obama’s Affordable Care Act.  Although this year the mainstream media will be focusing on the arguments regarding the constitutionality of California’s Proposition 8 and the Defense of Marriage Act (regarding gay marriage), two significant cases with far-reaching consequences for the branded and generic drug industries were also argued this month.  How the Supreme Court rules on so-called “pay for delay” settlements in patent infringement litigations and a First Circuit decision holding that generic drug makers can be held liable for personal injuries on a “design defect” theory, even if federal preemption would bar an identical suit on a “failure to warn” theory, should decide the course for much drug industry litigation for years to come. [Read more…]

Generic Skinny Labeling – A Different Kind of Off-Label Promotion – Part II

In my last post, I discussed how generic manufacturers use the practice of “skinny labeling” to get a free ride on a branded drug’s unexpired method of use patent.  As I explained, when a pioneer drug has multiple indications, each of which is protected by a separate method of use patent with its own expiration date, the generic drug manufacturer can avoid having to incur the considerable expense and risk in challenging the validitiy and enforceability of the unexpired method of use patent by submitting a “section viii” statement with its ANDA.  By side-stepping a Paragraph IV certification under Hatch-Waxman, the generic manufacturer not only avoids the risk of an adverse ruling and losing millions of dollars in patent infringement litigation, but ends up selling its skinny-labeled drug for the patent-protected use anyway because of mandatory and permissive “substitution” rules that require/allow generic substitution of cheaper “AB” rated generic drugs for branded drugs.  While a skinny label free ride is great for the generic  drug industry, the innovator drug industry is caught in the horns of a skinny label dilemma:  should it continue to invest and lose billions of dollars in clinical research getting FDA approval of current off-label uses (knowing that as soon as the patents on a drug’s compound and original indication(s) expire, the drug will get skinny labeled), or forego the investment and face the possibility of investigation and prosecution for off-label promotion of those uses? [Read more…]