Merck & Co., Inc. v. Hi-Tech Pharmacal Co., Inc. (Fed. Cir. 2007)

    By Sherri Oslick ---

In a case testing the interplay between terminal disclaimers and patent term extensions under the Hatch-Waxman Act, the Federal Circuit, in affirming the judgment of the district court, held that patent term extensions could - nay should - be applied to terminally disclaimed patents, leaving Merck's Hatch-Waxman extension for its patent covering Trusopt® intact.

Trusopt® was approved by the FDA for the treatment of ocular hypertension (glaucoma), with U.S. Patent No. 4,797,413 listed in the orange book as covering this brand name drug.  During prosecution of the application leading to the '413 patent, Merck overcame an obviousness-type double patenting rejection over U.S. Patent No. 4,677,115 by filing a terminal disclaimer disavowing any term of the '413 patent extending beyond the expiration of the '115 patent (December 12, 2004).  Merck applied for, and received, a patent term extension of 1233 days pursuant to 35 U.S.C. § 156 (§ 201 of the Hatch-Waxman Act), moving the expiration date of the '413 patent to April 28, 2008.

In seeking approval to market a generic version of Trusopt®, Hi-Tech filed two ANDAs with the FDA, including a Paragraph IV certification of non-infringement.  In response, on January 18, 2006, Merck filed suit against Hi-Tech for infringement of the '413 patent.  Hi-Tech moved to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), asserting that while its products fell within the claims of the '413 patent, the '413 patent had expired as on December 12, 2004 as the terminal disclaimer rendered the patent term extension inapplicable and improperly granted.  Merck moved for judgment on the pleadings, contending that the patent term extension was properly granted.  The district court entered final judgment in favor of Merck, denying Hi-Tech's motion and granting Merck's, and enjoined Hi-Tech from marketing its generic drug prior to April 28, 2008.

Hi-Tech appealed, the single issue on appeal surrounding the interplay of the Hatch-Waxman patent term extension provision, 35 U.S.C. 156, and terminal disclaimers.  Pursuant to 35 U.S.C. 156, "the term of a patent...shall be extended" provided that five criteria are met.  Hi-Tech did not assert that the '413 patent failed to meet these criteria but rather argued that: 1) the grant of additional patent term to a terminally disclaimed patent ran contrary to the purpose behind the use of terminal disclaimers and effectively uncoupled the terminal disclaimer from the expiration date of the prior disclaimed patent; 2) a holding that patent term extensions applied to terminally disclaimed patents conflicted with prior case law; and 3) 37 C.F.R. § 1.775, which endorses extensions of terminally disclaimed patents, was, according to Hi-Tech, invalid.  Merck argued that the language of § 156 unambiguously states that a patent term "shall be extended" provided the enumerated criteria are met, and moreover that patent term extensions under § 156 and terminal disclaimers are not mutually exclusive as they serve unrelated and independent purposes.

Turning first to the language of § 156, the Federal Circuit held that the use of the word "shall," as with other statutes, mandated action, in this case grant of a patent term provided the necessary criteria are met.  The legislative history of the Hatch-Waxman Act, noted the court, was consistent with it's statutory construction.  The Court further noted that while 35 U.S.C. § 154 (which authorizes a patent term adjustment due to PTO delays) specifically renounces its applicability to terminally disclaimed patents, § 156 contains no such provision.  The court concluded that taken as a whole, these points supported the applicability of patent term extensions to terminally disclaimed patents.  To Hi-Tech's argument that the court's holding uncoupled the terminal disclaimer from the expiration date of the prior disclaimed patent, the Court noted that the Hatch-Waxman extension was calculated from the expiration date of the patent as provided by the terminal disclaimer and thus, the waiver of term through the terminal disclaimer remained in force.  The Court noted that the goal of the terminal disclaimer - to disclaim any portion of the patent considered obvious over the prior patent - was still achieved, as was the goal of the Hatch-Waxman extension in restoring patent term due to regulatory review. 

To Hi-Tech's remaining arguments, the Court found the case law raised by Hi-Tech to be inapplicable, and 37 C.F.R. § 1.775 to be valid.

Merck & Co., Inc. v. Hi-Tech Pharmacal Co., Inc. (Fed. Cir. 2007)
Panel: Circuit Judge Linn and Senior Circuit Judges Friedman and Plager
Opinion by Circuit Judge Linn

Additional information regarding this case can be found at the Orange Book Blog and Patently-O.

Comments

[Hi Tek Craig]

The FDA is a joke. They allow drugs to be passed that kill, but they want to take away our right to purchase a multivitamin?