Posts Tagged: "blockbuster drugs"

In a moment of extreme weakness, I agreed to Gene’s request to doing a primer on Paragraph IV Certifications under the Drug Price Competition and Patent Term Restoration Act, commonly referred to as Hatch-Waxman. I don’t know if you would call me an expert, but I’ve studied many, many cases involving Paragraph IV Certifications under Hatch-Waxman. The courts have found Hatch-Waxman to be a hydra-like monster with a labyrinth of sections that are frequently confusing (or worse yet, conflicting). Paragraph IV Certifications are a particular trouble spot in Hatch-Waxman. So if you’re up to diving into the “belly of this beast,” let’s examine the characteristics of this most infamous of the Hatch-Waxman monsters. To understand Paragraph IV Certifications, you must first address what an Abbreviated New Drug Application (ANDA) is. ANDAs are how generic drug manufactures expedite the approval of their generic drugs.

Americans cannot be expect to either personally or through their health insurance bear the burden associated with solely providing the return on investment required by investors to prompt pharmaceutical companies into the marketplace. Whether Americans pay through exorbitant prices out of pocket, or they pay through high priced health insurance premiums, there is no doubt that Americans subsidize individuals all around the world who pay far less than we pay in the United States. This is not a patent problem, but rather it is a government problem. Rather than seize control of the U.S. health care industry government should have tackled the underlying drivers of the cost, and a great place to start would have been in the staggeringly disparate cost of drugs between the U.S. and virtually every other country around the world.

Last week, on Friday, June 15, 2012, Merck (NYSE: MRK) announced the U.S. District Court for the District of New Jersey (Judge Peter G. Sheridan) ruled against the company on the issue of patent infringement in its suit against Apotex Inc. According to Merck, global sales of Nasonex® in 2010 topped $1.2 billion. See Merck News. A variety of Internet sources place the Nasonex® market share of the inhaled steroid market at 47%. Therefore, this patent loss some 6 years before the Nasonex® patent expires is a big deal.

The mantra of the anti-patent community is nearly in unison on the issue of patented drugs. Of course, everyone wants drugs to be developed, but no one wants to pay the exorbitant prices charged for blockbuster, patented drugs. You can add me to that list of individuals who doesn’t like the prices, but at least there is a benefit. Without appropriate financial incentives in place drugs would not be patented, but then again they wouldn’t be developed either. But what is the justification for scarcity and exorbitant prices of old drugs that are off patent?

I am skeptical about the prospects for invalidating patents on drugs, particularly important or blockbuster drugs. I also question whether anti-patent do-gooders in the biotech and pharma space are really causing more harm than good through attempts to bust patents on blockbuster drugs. According to their own press release, PUBPAT acknowledges that the tablet is heat stable and does not need to be refrigerated like prior versions of the drug. They seemingly make the argument, although not directly, that because this makes it much more convenient for patients it is unfair to charge prices sufficient to recoup R&D and a premium to make the speculative R&D reasonably profitable for investors. Of course, the fact that the drug in question is extremely convenient for patients is not a reason to invalid the claims, and in fact is likely a compelling reason why in this instance the patent claims cover a truly novel and nonobvious innovation.