A key provision of the Hatch-Waxman Act resides in 35 U.S.C. § 271(e)(1) which provides immunity from a patent infringement suit where the testing of the patented invention is for the purpose of securing regulatory approval from the FDA. Or to use the specific language of 35 U.S.C. § 271(e)(1), there is no patent infringement if the use of the patented invention is “solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs.”
This Hatch-Waxman provision, commonly known as the “safe harbor,” has been construed twice by the Supreme Court, and in an expansive manner to immunize alleged infringing activity. First, in the 1990 case of Eli Lilly & Co. v. Medtronic, Inc., the Supreme Court ruled that this “safe harbor” applied to medical devices, not just drugs as was originally believed (including by the respective House and Senate floor managers for the Hatch-Waxman Act). In fact, the basis for the holding in the Medtronic case makes this “safe harbor” essentially applicable to the testing of any patented invention that is for the purpose of securing regulatory approval from the FDA (e.g., food additives, cosmetics, etc.). See Guttag, “The Ever Expanding ‘Safe Harbor’ of Hatch-Waxman: The Merck v. Integra Lifesciences Case,” Cincinnati Bar Association Report, page 16 (August 2005).
Second, in 2005, Supreme Court ruled in Merck KgaA v. Integra Lifesciences I, Ltd. that this “safe harbor” applied to pre-clinical research, not just clinical research. What I found startling in reviewing the Supreme Court’s opinion was just how far the Merck case might have expanded this “safe harbor.” There are statements in Merck that suggest such pre-clinical research would be protected by the “safe harbor” even if: (1) that research was for the purpose of developing new drugs or new uses of existing drugs (not simply safety testing); or (2) the results of such research were later not submitted to the FDA to secure regulatory approval, i.e., the immunity would not be lost or stripped because of later non-use of the research results. In other words, as long as the pre-clinical research was “reasonably related” to potentially securing regulatory approval from the FDA, the “safe harbor” of Hatch-Waxman would apply.
While the Supreme Court may have expanded the reach of the Hatch-Waxman “safe harbor,” the Medtronic and Merck cases only involved pre-marketing FDA approval activity. But the recent split Federal Circuit panel decision in Momenta Pharmaceuticals, Inc. v. Amphastar Pharmaceuticals, Inc. has now (alarmingly in my view) further widened the applicability of this “safe harbor” beyond such pre-marketing FDA approval activity. In Momenta Pharmaceuticals, Judge Moore (writing for the majority joined by Judge Dyk) ruled that this “safe harbor” could also apply to post-FDA approval activity, even if that activity was at least arguably commercial in nature.
Not surprisingly, Chief Judge Rader vociferously dissented, arguing (in my opinion correctly) that Judge Moore’s opinion reads 35 U.S.C. § 271(e)(1) in a manner contrary to the statutory language, and more importantly, completely inconsistent with the legislative intent for when this “safe harbor” provision was to apply. Even more troubling, Judge Moore’s majority opinion in Momenta Pharmaceuticals cannot be easily squared with the earlier Federal Circuit case of Classen Immunotherapies, Inc v. Biogen IDEC (where Judge Moore dissented from the Federal Circuit’s majority opinion written by Judge Newman and joined by Chief Judge Rader). For reasons I’ll discuss below, Classen strongly suggests (if it does not specifically hold) that the Hatch-Waxman “safe harbor” does not apply to such post-FDA approval activity. In fact, for other reasons I’ll discuss below, it is questionable whether Momenta’s patented analytical method is even qualifies as a “patented invention” that is subject to this “safe harbor” provision.
The Momenta Pharmaceuticals centers on the drug enoxaparin (a low molecular weight version of the anti-coagulant, heparin) for preventing blood clots. Enoxaparin is made by breaking the heparin polysaccharide into smaller oligosaccharides. Because of how it is made (and because of the diversity of starting material), the resulting enoxaparin may comprise a range of molecules of differing sizes. This diversity in molecular sizes makes it much more difficult to establish generic versions of enoxaparin are “bioequivalent” to Lovenox (Aventis’ FDA approved marketed version of enoxaparin) for the purpose of obtaining approval by the FDA of an Abbreviated New Drug Application (ANDA) to market the generic enoxaparin.
The FDA had identified five criteria (“standards for identity”) for establishing the “bioequivalency” of generic forms of enoxaparin, which include equivalence in terms of: disaccharide building blocks; (2) fragment mapping; and (3) sequence of oligosaccharide species. Following “exhaustive enzymatic digestion” of a sample of the generic enoxaparin, the resulting constituent disaccharide building blocks are separated and may then be quantified by various analytical techniques. Momenta had developed a patented method (U.S. Pat. No. 7,575,866 or the ‘866 patent) for analyzing enoxaparin samples (after such “exhaustive enzymatic digestion”) to determine the presence and amount of non-naturally occurring sugars (resulting from the ?-eliminative cleavage of the enoxaparin starting material) in order to select appropriate batches of generic enoxaparin having bioequivalence to Lovenox.
In 2003, Amphastar filed for an ANDA on its generic version of enoxaparin and received approval from the FDA in September 2011. Meanwhile, Momenta received earlier FDA approval to market its generic version of enoxaparin in July 2010. Momenta later alleged that Amphastar infringed Momenta’s ‘866 patent by “manufacturing generic enoxaparin for commercial sale” using Momenta’s patent analytical method. Specifically, Momenta asserted that Amphastar ‘“included in their process for manufacturing batches of enoxaparin sodium” a description of “a method for determining that a defined percentage of the oligosaccharide chains that make up enoxaparin” included the non-naturally occurring sugars (referred to as “quality control batch testing”).
The district court granted Momenta’s request for a preliminary injunction based on its belief that Amphastar’s “quality control batch testing” of its generic enoxaparin infringed Momenta’s ‘886 patent. While agreeing that Amphastar’s use of Momenta’s patented analytical method was for the purpose of developing information to submit to the FDA, the district court concluded that the Hatch-Waxman “safe harbor” did not apply where the generic manufacturer continues “in an otherwise infringing activity after obtaining such [marketing] approval” from the FDA. The district court apparently reached this conclusion by focusing on the legislative history of the “safe harbor” provision, as quoted in Classen. In fact, Judge Newman’s majority opinion in Classen said that the House Report on Hatch-Waxman is “replete with statements that the legislation concerns premarketing approval of generic drugs.” (Emphasis added.)
Judge Moore’s majority opinion in Momenta Pharmaceuticals vacated the preliminary injunction, agreeing with Amphastar that the “quality control batch testing” fell within the “safe harbor” provision of Hatch-Waxman. The majority opinion focused first on whether the language of 35 U.S.C. § 271(e)(1) had a “plain and unambiguous meaning” with respect to this “safe harbor” provision. While Judge Moore acknowledged that this “safe harbor” provision was enacted in the context of the ANDA approval process, she construed this “broad language” of 35 U.S.C. § 271(e)(1) to apply to activities beyond the ANDA approval process. In support of her position, Judge Moore observed that Congress had specifically excluded certain patented inventions (i.e., new animal drug or veterinary biological product made by using certain genetic techniques) from this “safe harbor.” Judge Moore further noted that, unlike the “closely related infringement provision” 35 U.S.C. § 271(e)(2) (which provides for “technical infringement” of the patented invention to be based simply on filing of the ANDA), 3 5 U.S.C. § 271(e)(1) did not link the “safe harbor” to such ANDA approval. Accordingly, Judge Moore said that the “scope of the Hatch-Waxman safe harbor does not stop at activities reasonably related to development of information submitted in an ANDA.”
Judge Moore’s opinion says that her analysis “is not groundbreaking” in view of the Supreme Court’s decision in Medtronic which she asserts “came to essentially the same conclusion.” But Judge Moore’s analysis is, in fact, “groundbreaking” because Medtronic only addressed what “patented inventions” (e.g., medical devices) fell within the scope of the Hatch-Waxman “safe harbor.” Judge Moore’s further assertion that the Supreme Court “reaffirmed this expansive view” in Merck only goes so far as that “view” expanded the “safe harbor” to include a wide range of pre-marketing FDA approval activities. Nothing in either Medtronic or Merck suggests that the Supreme Court intended the “safe harbor” to reach post-FDA approval activity.
While Judge Moore’s opinion acknowledges that the “safe harbor” is limited to uses “reasonably related to the federal regulatory process,” she omits a very important further limitation on such use: it must be “solely” for such uses. In fact, Judge Moore’s opinion essentially glosses over this “solely for uses” language when distinguishing the holding in Classen as applying only to “information that may be routinely reported to the FDA, long after marketing approval has been obtained.” Rather than being a “routine” submission, Judge Moore’s opinion viewed Amphastar’s “quality control batch testing” information to be “necessary both to the continued approval of the ANDA and to the ability to market [its] generic [enoxaparin] drug.” Accordingly, Judge Moore’s opinion concluded that, “[u]nder such circumstances, the information can be said to have been gathered solely for submission to the FDA and not, as in Classen, primarily for non-FDA purposes.”
The problem with this expansive view expressed by Judge Moore is that it reads the phrase “solely” virtually out of the “safe harbor” provision. Ironically, footnote 1 of Judge Moore opinion expresses “puzzle[ment]” at Chief Judge Rader’s claim that the word “solely” (as well as the word “submitted”) required limitation of the “safe harbor” provision to pre-FDA approval activities. But as Chief Judge Rader’s dissent correctly observes, Judge Moore’s opinion not only “discounts” the word “solely” to “facilitate [an infringing] post-[FDA] approval, continuous, commercial use,” but even repeatedly cites the language of the “safe harbor” provision without even mentioning this crucial word. If the phrase “solely for uses” is to mean anything in limiting the scope of this “safe harbor,” Chief Judge Rader’s view that “solely for uses” means Amphastar’s use of Momenta’s patented analytical method (i.e., “for the purpose of manufacturing a product to sell on the market in commerce”) is outside the “safe harbor” has to be the correct one.
More significantly, and as Chief Judge Rader’s dissent correctly points out, Judge Moore’s opinion completely “circumvents” the purpose of this “safe harbor” provision which is manifestly “evident from the legislative history.” As the legislative history repeatedly shows, this “safe harbor” provision was to be applied “only in limited situations, namely pre-approval experiments to obtain FDA approval.” In fact, as Chief Judge Rader also correctly observed, this “safe harbor” provision only “won approval because it was limited in time, quantity, and type” (the “time” being only during “pre-marketing approval). In particular, this “safe harbor” provision was not intended by Congress to “apply to commercial sales.”
A much weaker argument made by Momenta was that the phrase “solely for uses” in 35 U.S.C. § 271(e)(1) means that the patented invention must be the “sole” means for providing the “information” for the “safe harbor” provision to apply. (The situation in Momenta Pharmaceuticals is unusual in that the asserted infringing activity relates not to the patented FDA-approved drug, or even to the use of that patented drug, but instead to a patented method for analyzing the FDA-approved drug.) Judge Moore’s view that “solely for uses” does not “mandate the use of other, non-patented, testing methods” for the “development and submission” of such information is, in my opinion, the correct one. In this respect, Chief Rader’s dissent goes too far in suggesting that Judge Moore’s opinion is based on Momenta’s patented analytical method being “mandated” by the FDA, rather than that the “information” resulting from that patented method was “mandated.”
Of particular concern in Momenta Pharmaceuticals is that Judge Moore’s basis for distinguishing Classen (routine submissions for non-FDA purposes) reads Judge Newman’s ruling in Classen far too narrowly. (Or as Chief Judge Rader’s dissent says, “this court must stretch too far to claim [that] Classen did not turn on a pre-/post- approval distinction.) Judge Newman’s opinion in Classen agreed with the patentee’s position there that the “safe harbor” provision of Hatch-Waxman provided an exception to patent infringement “in order to expedite development of information for regulatory approval of generic counter-parts of patented products.” In fact, Judge Newman’s opinion in Classen also cites to and relies upon the same legislative history that Chief Judge Rader’s dissent cites to in Momenta Pharmaceuticals that shows this “safe harbor” provision was intended Congress to apply only to pre-marketing FDA approval.
Even more relevant (and contrary to what Judge Moore’s opinion in Momenta Pharmaceuticals suggests), Judge Newman’s opinion says that every decision reviewing 35 U.S.C. § 271(e)(1), including the Supreme Court’s Medtronic and Merck decisions, has “appreciated that [the “safe harbor” provision] is directed to premarketing approval of generic counterparts before patent expiration.” In fact, in footnote 4 of her majority opinion, Judge Newman directly refutes Judge Moore basis for distinguishing Classen in Momenta Pharmaceuticals by observing that Judge Moore’s dissent in Classen “strays from [35 U.S.C. § 271(e)(1)] and precedent in arguing that any activity by any entity concerning any adversely patented product or method is exempted from infringement by [the “safe harbor” provision], provided only that the information obtained is ‘reasonably related to submitting any information under the FDCA.’”
Chief Judge Rader’s dissent raises the additional problem that applying the “safe harbor” provision to Momenta’s patented analytical method creates a “disequilibrium” between Section 201 of Hatch-Waxman (which permits patent extensions where there is regulatory delay in marketing the patented invention) and Section 202 (which permits/protects activities, such as those supporting ANDAs, prior to patent term expiration) because Momenta could not obtain patent term extension for its ‘866 patent under Section 201 (now 35 U.S.C. § 156). In support of this “disequilibrium” argument, Rader cites the 2008 decision in Proveris Scientific Corp. v. Innovasystems, Inc. In response, Judge Moore’s majority opinion tries to refute this “disequilibrium” argument by citing the 1997 decision in Abtox, Inc. v. Exitron Corp. (holding that “patented invention” of 35 U.S.C. § 271(e)(1) includes all medical devices, whether or not eligible for patent term extension under 35 U.S.C. § 152).
In my opinion, the holding in Proveris Scientific (rather than Abtox) is much more applicable to Amphastar’s use of Momenta’s patented analytical method, but not primarily based on Rader’s “disequilibrium” argument. While Proveris Scientific discusses this “disequilibrium” issue, that was not the primary basis for the holding in that case that the “safe harbor” provision did not apply. Instead, Proveris Scientific ruled that the term “patented invention” in the “safe harbor” provision did not include the alleged infringer’s analytical device because it was not subject to pre-market approval by the FDA. Similarly, it does not appear that Momenta’s patented analytical method was subject to pre-market FDA approval, and was thus outside the “safe harbor” provision, whether or not the information provided by that patented method was “reasonably related to the development and submission of information” required by the FDA.
In my opinion, Judge Moore’s opinion in Momenta Pharmaceuticals simply resurrects her expansive dissenting view in Classen to impermissibly widen the “safe harbor” provision of Hatch-Waxman to include post-FDA approval activities. Even worse, Momenta Pharmaceuticals permits the continuance of such activities that are least arguably commercial nature and thus not “solely for uses reasonably related to the development and submission of information” for FDA approval. As Chief Judge Rader correctly observes, the ruling Momenta Pharmaceuticals would “render worthless manufacturing test method patents” like those of Momenta’s ‘866 patent. In fact, it is very problematical that use of Momenta’s patented analytical method by Amphastar even qualifies as a “patented invention” subject to the “safe harbor” provision in view of the Federal Circuit’s holding in Proveris Scientific. For at least these reasons, Chief Judge Rader is correct that “[t]his decision should instead request the entire court to resolve the issue en banc.”
*© 2012 Eric W. Guttag. Posted August, 2012 on IPWatchdog.com