By Kevin E. Noonan --
One of the longest patent law sagas has apparently reached an end. As announced by The Medicines Company (MDCO) today, the drug developer has reached a settlement of litigation with APP Pharmaceuticals over Angiomax® (bivalirudin). Most important for MDCO, the settlement dismisses APP's appeal of the denial of its motion to intervene in MDCO’s mandamus action against the PTO's decision denying patent term extension for its patent relating to Angiomax®, the last obstacle to MDCO obtaining patent term extention for its U.S. Patent No. 5,196,404.
The tale has been often told on the circumstances surrounding MDCO's patent term extension (PTE) Request for the ‘404 patent. Pursuant to 35 U.S.C. § 156, MDCO had 60 days from the date that Angiomax® received regulatory (FDA) marketing approval to file its PTE Request (35 U.S.C. § 156(d)(1)). The approval letter was sent by the FDA to MDCO by facsimile transmission at 6:17 pm on Friday, December 15, 2000. The FDA subsequently published the approval date for Angiomax® on its website as being December 19, 2000. MDCO filed its PTE Request on February 14, 2001, a date that is 61 days after December 15, 2000, 58 days after December 18, 2000 (the Monday following the date of the Friday night fax) and 57 days after the approval date the FDA posted on its website for Angiomax®. These calculations were complicated by a later-issued directive by the PTO that, for purposes of calculating the time period for filing a PTE Request, the Office would consider the day the FDA mailed its approval letter in the calculation (i.e., the times above are each increased by one day) (In re Patent Term Extension Application for U.S. Patent No. 5,817,338, 2008 WL 5477276 (Comm'r. Pat. Dec. December 16, 2008)). In any case, the PTO, relying on a certification from the FDA that the approval date was Friday, December 15, 2000, refused MDCO's Request, costing the company to lose 4.5 years (about 1773 days) of extension for the ‘404 patent (which nominally expired on March 23, 2010).
MDCO filed a request for reconsideration of this decision, on the grounds that the FDA faxed its letter "after hours" on a Friday, "and that under FDA's practices, facsimiles submitted to FDA after close of business are considered received by the Agency on the next business day" (emphasis added). Applying this standard, the approval notification date would have been Monday, December 18th, and MDCO's Request would have been timely filed even under an interpretation including the approval date in the 60-day period. The PTO transmitted the request for reconsideration to the FDA (since the dispute involved FDA procedures), which the FDA rejected without comment or support, maintaining that the approval date was Friday, December 15th.
The PTO did not issue a formal denial of MDCO's request, but instead permitted the company to file an amended request for reconsideration and an amended extension application, which were filed on March 13, 2007. Less than six weeks later, on April 26, 2007, the PTO denied the request, again with no explanation of the inconsistency in the FDA's position on submissions to and notices from the agency. It was at this time that the Office applied the revised calculation for determining when a PTE Request must be filed, determining in this case that MDCO had filed its Request 2 days late.
MDCO filed a petition for leave to file a second request for reconsideration on the grounds that it had not had an opportunity to address this new interpretation of the deadline date for filing its PTE Request. MDCO argued that there was no requirement in the statute that would preclude the Office from adopting its proposed "next business day" rule, and that such an interpretation would "comport with the statute's text and purpose." While the Office granted leave for filing the second request for reconsideration (based on the "extraordinary situation" occasioned by its change in how days were counted for calculating the filing deadline), it denied the request substantively. The PTO's position was that the Office did not have the authority under § 156 to adopt the proposed "next business day" rule, at least because there was no basis to distinguish "during business hours" from "after business hours" in the statute, which recites the date (per the PTO, "span[ning] the course of 24 hours").
MDCO brought suit in the Eastern District of Virginia (Claude M. Hilton, District Court Judge), and on March 16, 2010 the Court ordered on remand that the Office reconsider its position on the grounds that "§156(d)(1) was a remedial statute and that it should be liberally construed," and that "the PTO was not bound by statute or case law to reject the business day interpretation of the work date in §156(d)(1)." Three days later, the Office "without any additional hearings" issued another decision again rejecting the "next business day" interpretation of the statute advanced by MDCO. The Office went further, holding that the timing provisions of the statute were not remedial in nature, and that the Office was bound by Federal Circuit authority to interpret the word "date" in the statute as the calendar day on the FDA approval letter. In response, MDCO returned to the District Court under the Administrative Procedures Act, 5 U.S.C. §§ 551-706, arguing that the agency's action was arbitrary and capricious.
On August 3, 2010, Judge Hilton ordered the PTO to consider MDCO's patent term extension application timely filed (see "The Medicines Company Prevails in Patent Term Extension Dispute"). The period for the government to appeal the Court's August 3, 2010 decision expired without government appeal. However, on August 19, 2010, APP filed a motion to intervene for the purpose of appeal in MDCO's case against the PTO, FDA, and HHS. On September 13, 2010, the District Court denied APP's motion (see "The Medicines Company Clearing Last Hurdles to Patent Term Extension for Angiomax®"). APP appealed the denial of its motion, as well as the District Court's August 3, 2010 order (and all related and underlying orders), to the U.S. Court of Appeals for the Federal Circuit. The settlement announced today ends this appeal.
In addition, the settlement also contains an admission by APP that the patents involved in its ANDA filing, U.S. Patent No. 7,582,727 and 7,598,343, are not invalid or unenforceable against APP and would be infringed by APP's sale of its generic bivalirudin. This portion of the settlement raises other issues, however. The two later patents (i.e., the '727 and '343 patents) expire in 2028, but the settlement grants APP a license that permits APP to sell its generic bivalirudin on (or under some circumstances prior to) May 1, 2019. In addition, APP has agreed to supply MDCO with finished drug product, an advantage in view of expected increases in demand and recent loss of manufacturing capacity by cancellation of agreements between MDCO and other contract manufacturer(s). The settlement also includes an agreement whereby APP will supply under license additional generic products relating to "acute cardiovascular, neurological and infectious diseases."
These agreements must be submitted to the U.S. Department of Justice and the Federal Trade Commission under the Medicare Prescription Drug, Improvement and Modernization Act of 2003. Given the FTC’s skepticism of the motivations and legality of patent settlement agreements, it is likely that this agreement (which provides final disposition of MDCO’s PTE dispute) will be critically scrutinized, particularly in view of the notoriety surrounding the circumstances and the FDA's and PTO's recalcitrance over the proper standards for awarding PTE under the statute (see "FTC Disapproves of 'Pay-for-Delay' Drug Deals" and "FTC Continues Attempts to Block Reverse Payments").
For additional information regarding this topic, please see:
• "The Medicines Company Clearing Last Hurdles to Patent Term Extension for Angiomax®," September 16, 2010
• "USPTO Acts Quickly to Comply with Court Order," August 6, 2010
• "The Medicines Company Prevails in Patent Term Extension Dispute," August 4, 2010
• "House Passes Patent Term Extension Bill," June 27, 2008