Patent Docs

Court Report

May 8, 2011

By Sherri Oslick —

About Court Report: Each week we will report briefly on recently filed biotech and pharma cases.

Mutual Pharmaceutical Co. et al. v. West-Ward Pharmaceutical Corp.
3:11-cv-02276; filed April 21, 2011 in the District Court of New Jersey

• Plaintiffs: Mutual Pharmaceutical Co.; AR Scientific, Inc.; AR Holding Co.
• Defendant: West-Ward Pharmaceutical Corp.

Infringement of U.S Patent Nos. 7,619,004 ("Methods for Concomitant Administration of Colchicine and Macrolide Antibiotics," issued November 17, 2009), 7,601,758 ("Methods for Concomitant Administration of Colchicine and Macrolide Antibiotics in the Treatment of Gout Flares," issued October 13, 2009), 7,820,681 ("("Methods for Concomitant Administration of Colchicine and a Second Active Agent," issued October 26, 2010), and 7,915,269 (same title, issued March 29, 2011) following West-Ward's filing of an NDA (under § 505(b)(2) of the Food, Drug and Cosmetic Act) to manufacture a generic version of Mutual's Colcrys® (single-ingredient colchicine product, used to prevent and treat gout flares). View the complaint here.

Novartis AG et al. v. Teva Pharmaceuticals USA Inc. et al.
1:11-cv-00353; filed April 20, 2011 in the District Court of Delaware

• Plaintiffs: Novartis AG; Novartis Pharmaceuticals Corp.
• Defendants: Teva Pharmaceuticals USA Inc.; Teva Pharmaceutical Industries Ltd.

Infringement of U.S. Patent Nos. 6,025,391 ("Enteric-Coated Pharmaceutical Compositions of Mycophenolate," issued February 15, 2000), 6,172,107 ("Entric-Coated Pharmaceutical Compositions," issued January 9, 2001), and 6,306,900 (same title, issued October 23, 2001) following a Paragraph IV certification as part of Teva's filing of an ANDA to manufacture a generic version of Novartis' Myfortic® (mycophenolate sodium, used for the prophylaxis or prevention of organ rejection in patients receiving allogeneic renal transplants, administered in combination with cyclosporine and corticosteroids). View the complaint here.

Genentech, Inc. et al. v. Sandoz Inc.
3:11-cv-01925; filed April 20, 2011 in the Northern District of California

• Plaintiffs: Genentech, Inc.; Roche Palo Alto, LLC
• Defendant: Sandoz Inc.

Infringement of U.S. Patent No. 6,083,953 ("2-(2-amino-1,6-dihydro-6-oxo-purin-9-yl)methoxy-1,3-propanediol Derivative," issued July 4, 2000) following a Paragraph IV certification as part of Sandoz's filing of an ANDA to manufacture a generic version of Roche's Valcyte® (valganciclovir hydrochloride, used to treat cytomegalovirus retinitis and cytomegalovirus disease). View the complaint here.

Shire LLC et al. v. Mylan Pharmaceuticals Inc. et al.
1:11-cv-00055; filed April 20, 2011 in the Northern District of West Virginia

• Plaintiffs: Shire LLC; Supernus Pharmaceuticals, Inc.
• Defendants: Mylan Pharmaceuticals Inc.; Mylan Inc.

Infringement of U.S. Patent Nos. 6,287,599 ("Sustained Release Pharmaceutical Dosage Forms with Minimized pH Dependent Dissolution Profiles," issued September 11, 2001) and 6,811,794 (same title, issued November 2, 2004) based on Mylan's filing of an ANDA to manufacture a generic version of Shire's Intuniv (guanfacine, used to treat attention-deficit hyperactivity disorder). View the complaint here.

Bayer Schering Pharma AG et al. v. Mylan Pharmaceuticals Inc. et al.
3:11-cv-02225; filed April 19, 2011 in the District Court of New Jersey

• Plaintiffs: Bayer Schering Pharma AG; Bayer Healthcare Pharmaceuticals Inc.
• Defendants: Mylan Pharmaceuticals Inc.; Mylan Inc.; Famy Care Ltd.

Bayer Schering Pharma AG et al. v. Mylan Pharmaceuticals Inc. et al.
2:11-cv-00604; filed April 19, 2011 in the District Court of Nevada

• Plaintiffs: Bayer Schering Pharma AG; Bayer Healthcare Pharmaceuticals Inc.
• Defendants: Mylan Pharmaceuticals Inc.; Mylan Inc.; Famy Care Ltd.

Bayer Schering Pharma AG et al. v. Mylan Pharmaceuticals Inc. et al.
1:11-cv-00053; filed April 19, 2011 in the Northern District of West Virginia

• Plaintiffs: Bayer Schering Pharma AG; Bayer HealthCare Pharmaceuticals, Inc.
• Defendants: Mylan Pharmaceuticals Inc.; Mylan Inc.; Famy Care Ltd.

The complaints in these cases are substantially identical. Infringement of U.S. Patent No. RE37,564 ("Composition for Contraception," issued February 26, 2002) following a Paragraph IV certification as part of Mylan's filing of an ANDA to manufacture a generic version of Bayer's Yaz® (drospirenone & ethinyl estradiol, used for oral contraception). View the New Jersey complaint here.
Conference & CLE Calendar

May 8, 2011

May 18-19, 2011 – Forum on Freedom to Operate (C5) – Munich, Germany

May 23-25, 2011 – 6th International Judges Conference on Intellectual Property Law (Intellectual Property Owners Association) – Brussels, Belgium

June 2, 2011 – EPO Opposition & Appeals — The Case Law (Patent Resources Group and Management Forum) – Chicago, IL

June 3, 2011 – European Patents — The Case Law (Patent Resources Group and Management Forum) – Chicago, IL

June 7-8, 2011 – Biosimilars*** (American Conference Institute) – New York, NY

June 8, 2011 – Biotechnology/Chemical/Pharmaceutical (BCP) Customer Partnership Meeting (U.S. Patent and Trademark Office) – 10:00 am – 4:00 pm (EDT)

June 21-22, 2011 – 10th Annual Forum on Pharma Patent Lifecycles (C5) – London, England

September 18-20, 2011 – Accelerating Intellectual Property and Innovation in South Africa (South African Department of Science and Technology) – Cape Town, South Africa

***Patent Docs is a media partner of this conference or CLE
C5 Pharma Patent Lifecycles Conference

May 6, 2011

C5 (UK) will be holding its 10th Annual Forum on Pharma Patent Lifecycles on June 21-22, 2011 in London, England. The conference will provide practical and strategic guidance on patent lifecycle extensions, including:

• The scope of SPCs for combination products and the cases referred to the ECJ;
• Recent cases on SPCs in Europe — The originator perspective;
• Developing strategies to successfully monitor and manage SPCs on patent portfolios;
• The German Patent and Trade Mark Office (DPMA) perspective on tackling pharma and biotech patents;
• Examining potential anti-competitive practices and recent patent settlement agreements;
• Maximizing exclusivity for new medicinal products in light of regulatory and case law developments;
• Extending and protecting patent lifecycles in the BRIC countries;
• Structuring successful applications for selection patents and analyzing the various approaches in Europe;
• Guidance from the European Commission on lifecycle extensions;
• Classifying biosimilars and follow-on biologics in Europe and the U.S.;
• Preparing for the expiration of transitional provisions on paediatric extensions;
• Successfully obtaining preliminary injunctions to block exploitation from generic drugs; and
• The impact of U.S. developments on pharma lifecycle extensions.

In particular, C5 faculty will offer presentations on the following topics:

• A plethora of references: Medeva and its sequels — keynote address by Hon. Mr. Justice Arnold, Chancery Division of the High Court of Justice;
• Recent cases on SPCs in Europe — The Originator Perspective;
• Adopting strategies to overcome challenges based on recent industry trends;
• The German Patent and Trade Mark Office (DPMA) perspective on tackling biotech patents — Dr. Roman Maksymiw, Head of Division, German Patent and Trade Mark Office;
• Combating practical challenges for the grant of SPCs;
• Examining potential anti-competitive practices and recent patent settlement agreements;
• The impact of US developments on pharma lifecycle extensions;
• Structuring successful applications for selection patents and analysing the various approaches in Europe;
• Maximising exclusivity for new medicinal products in light of regulatory and case law developments;
• Guidance from the European Commission on lifecycle extensions — keynote address by Lavinia Teodorescu, Antitrust: Pharma and Health Services, DG Competition European Commission;
• Developing strategies to successfully monitor and manage SPCs on patent portfolios;
• Extending and protecting patent lifecycles in the BRIC countries;
• Preparing for the expiration of transitional provisions on paediatric extensions;
• Successfully obtaining preliminary injunctions to block exploitation from generic drugs;
• Classifying biosimilars and follow-on biologics in Europe and the US; and
• Monitoring the approval and grant processes of third party SPC applications.

A pre-conference workshop, entitled "Constructing Patent Settlement Agreements and Devising Effective SPC Strategies" will be offered from 1:00 pm to 4:30 pm on June 20, 2011.

The agenda for the Pharma Patent Lifecycles conference can be found here. A complete brochure for this conference, including an agenda, list of speakers, detailed descriptions of conference sessions, and registration form can be downloaded here.

The registration fee is £2197 for the conference and workshop and £1599 for the conference alone. Those registering by May 20, 2011 will receive a £100 discount. Those interested in registering for the conference can do so here, by calling +44 20 7878 6888, by faxing a registration form to +44 20 7878 6885, or by e-mailing registrations@C5-Online.com.
Billups-Rothenberg, Inc. v. Associated Regional and University Pathologists, Inc. (Fed. Cir. 2011)

May 5, 2011

By Donald Zuhn —

Last week, in Billups-Rothenberg, Inc. v. Associated Regional and University Pathologists, Inc., the Federal Circuit determined that the District Court for the Central District of California had properly granted summary judgment of invalidity with respect to U.S. Patent Nos. 5,674,681 and 6,355,425. In particular, the panel affirmed the District Court's decision that the asserted claims of the '681 patent were invalid for lack of written description, and its decision that the asserted claims of the '425 patent were invalid as anticipated by U.S. Patent No. 6,025,130.

In 2009, Plaintiff-Appellant Billups-Rothenberg, Inc. sued Defendants-Appellees Associated Regional and University Pathologists, Inc. (doing business as ARUP Laboratories) and Bio-Rad Laboratories, Inc. ("ARUP"), asserting that ARUP infringed certain claims of the '681 and '425 patents by providing or using diagnostic assays or kits for detecting Type I hereditary hemochromatosis. Type I hereditary hemochromatosis, which is an iron disorder characterized by excessive iron absorption by the body, is caused by specific mutations in the High Fe ("HFE") gene, which is located on the short arm of chromosome six in humans.

The '681 patent, which issued from an application filed by Billups in 1994, discloses that the gene responsible for hemochromatosis is located on human chromosome six. The '681 application also discloses that "[a] mutation in a nucleic acid sequence can be detected by various methods to analyze nucleic acids [which] are well known to those in the art." Claim 2 of the '681 patent recites:

2. A method to identify an individual having or predisposed to having hemochromatosis, comprising the steps of:
a) providing from the individual a sample containing a gene encoding a nonclassical MHC class I heavy chain and
b) detecting a mutation in said gene, which mutation results in the reduced ability of said heavy chain to associate with said β2 microglobulin, wherein the presence of said mutation identifies said individual as having or predisposed to having hemochromatosis.

The '681 patent does not, however, disclose the HFE gene or identify any mutations associated with hemochromatosis.

In 1996, a different group of researchers isolated and sequenced the hemochromatosis (or HFE) gene and identified three mutations in the gene that are associated with hemochromatosis: C282Y, H63D, and S65C. This research led to the issuance of the '130 patent, which discloses the HFE gene sequence and the C282Y, H63D, and S65C mutations (identified in the '130 patent as 24d1, 24d2, and 24d7, respectively):

The '130 patent, which is owned by Bio-Rad and licensed to ARUP, also discloses genetic tests for hemochromatosis that utilize the mutations and sequence variants identified in the patent.

Using the sequences disclosed in the '130 patent, Billups developed a method for diagnosing an iron disorder by testing for the S65C mutation. In 1999, Billups filed an application directed to this method, which issued as the '425 patent. Claim 1 of the '425 patent recites:

1. A method of diagnosing an iron disorder or a genetic susceptibility to developing said disorder in a mammal, comprising determining the presence of a mutation in exon 2 of an HFE nucleic acid in a biological sample from said mammal, wherein said mutation is not a CàG substitution at nucleotide 187 of SEQ ID NO: 1 and wherein the presence of said mutation is indicative of said disorder or a genetic susceptibility to developing said disorder.

At trial, Billups and ARUP filed cross-motions for summary judgment, Billups seeking summary judgment of infringement and ARUP seeking summary judgment of invalidity. The District Court denied Billups' motion and granted ARUP's motion of invalidity for lack of written description (as to the '681 patent) and anticipation (as to the '425 patent). With respect to the '681 patent, the District Court noted that neither the sequence of the HFE gene nor any mutations in the HFE gene were disclosed in the patent, and the "patentee has merely directed the person of ordinary skill in the art to a general location of a mutation on a chromosome and suggested that the mutation may be found in that vicinity." With respect to the '425 patent, the District Court determined that the '130 patent was prior art to the '425 patent, and further, that the '425 patent claims the same genetic test for the S65C mutation that is disclosed in the '130 patent.

Writing for the Federal Circuit, and addressing the issue of written description first, Judge Gajarsa noted that "Billups claims that its disclosure of the mutation's general location somewhere 'within less than a 300 base pair region of a defined exon of a well studied multi-gene family,' combined with the knowledge that existed at the time of filing the '681 patent, established that [the inventors] possessed the claimed invention." While "[t]he '681 patent claims a test for mutations," he also noted that "it is undisputed that the specification and originally filed claims of the '681 patent disclose neither the hemochromatosis gene sequence nor any specific mutations within that gene." In summarizing Billups' argument on appeal, Judge Gajarsa stated that:

Billups contends that the '681 patent taught structure, i.e., that hemochromatosis has a genetic basis, and function, namely, its adverse effect upon the binding of β2 microglobulin with a non-classical MHC class I heavy chain. Specifically, Billups argues that the '681 patent's correlation of function with the general location of the C282Y mutation, combined with the knowledge of a person of ordinary skill in the art in the field at the time of filing, satisfied the written description requirement by localizing the mutation to a 300 base pair region.

Agreeing with the District Court's findings that "[p]atentee's general location disclosure is too imprecise to constitute structural features necessary to meet the written description requirement," and that the "specification for the '681 patent contains only functional, not structural, characteristics of the predicted mutations," Judge Gajarsa determined that the District Court properly granted summary judgment of invalidity for lack of written description.

Turning to the issue of anticipation, Judge Gajarsa quickly concluded that:

The asserted claims of the '425 patent are invalid because they are anticipated by the '130 patent. The '130 patent was filed nearly three years before the '425 patent and is prior art under § 102(e). The district court correctly ruled that the '130 patent discloses use of the S65C mutation as a "HH [(hereditary hemochromatosis)] diagnostic," and, thus, Billups was not the first to disclose diagnosis of hemochromatosis using the S65C mutation.

While Billups argued on appeal that the '130 patent concludes that "the S65C mutation was only a clinically insignificant polymorphism unrelated to disease state," and therefore that "the '130 patent did not teach using the S65C mutation to diagnose hemochromatosis," Judge Gajarsa countered that "[d]espite the inventors' uncertainty regarding the utility of the S65C mutation because of their small sample size, the '130 patent describes two genetic tests for hemochromatosis that involve detection of the S65C mutation as an input for the diagnosis of hemochromatosis." Citing Celeritas Techs., Ltd. v. Rockwell Int’l Corp., 150 F.3d 1354, 1361 (Fed. Cir. 1998), Judge Gajarsa noted that "[a]lthough the '130 patent discounts the utility of the S65C mutation in diagnosing hemochromatosis, we have held that a 'reference is no less anticipatory if, after disclosing the invention, the reference then disparages it.'" Thus, "[e]ven though the inventors of the '425 patent performed experiments revealing greater diagnostic utility of the S65C mutation than initially suspected," Judge Gajarsa concluded that "the use of the S65C mutation as a diagnostic tool was already contemplated by the '130 patent," and therefore affirmed the District Court's finding of invalidity with respect to the '425 patent.

Billups-Rothenberg, Inc. v. Associated Regional and University Pathologists, Inc. (Fed. Cir. 2011)
Panel: Circuit Judges Gajarsa, Linn, and Moore
Opinion by Circuit Judge Gajarsa
Biotech/Pharma Docket

May 5, 2011

By James DeGiulio —

Seroquel Suit between AstraZeneca and Biovail Dismissed

AstraZeneca and Biovail have agreed to end their patent dispute over Seroquel XR after Biovail converted its Paragraph IV certification to a Paragraph III filing, thus agreeing not to market a generic version of Seroquel XR until after the expiration of the patents in the suit. The dispute between the drug companies began in January 2009, when AstraZeneca brought suit in the U.S. District Court for the District of New Jersey against Biovail, alleging that Biovail's Abbreviated New Drug Application (ANDA) covering three doses of extended-release quetiapine fumarate infringed U.S. Patent Nos. 4,879,288 and 5,948,437 (see "Court Report," January 18, 2009). In April 2009, Biovail countered that it did not infringe either patent, and that both patents were invalid. Biovail also argued that one of the patents was unenforceable because AstraZeneca engaged in inequitable conduct during prosecution of the patent by withholding internal information about compounds that could be considered atypical anti-psychotics.

On April 29, AstraZeneca and Biovail filed a joint stipulation of dismissal after Biovail changed its regulatory certification to a Pararaph III filing, agreeing not to commercially sell its generic drug until after the expiration of the '288 and '437 patents. The patents expire in 2011 and 2017, respectively. Judge Joel Pisano granted the parties' stipulation on May 2, dismissing all the claims and counterclaims in the action without prejudice, and ordered the parties to cover their own costs and attorneys' fees. The stipulation allows the AstraZeneca to retain some of Biovail's confidential information and other data for use in the related patent litigation against Handa, Torrent, and other generics.

Eli Lilly Successfully Blocks Release of Generic Cymbalta

Eli Lilly successfully secured an order that prohibits the defendants in the Cymbalta patent litigation from selling a generic version of duloxetine during the term of Eli Lilly's compound patent. In November 2008, Eli Lilly filed suit in the U.S. District Court for the Southern District of Indiana against Wockhardt, claiming the generic manufacturers' duloxetine oral capsules infringed U.S. Patent No. 5,023,269 (see "Court Report," November 23, 2008). Eli Lilly brought suit against several other generic companies, and these other suits were consolidated in February 2009 and stayed pending the outcome of Eli Lilly's case against Wockhardt. All defendants had alleged in their ANDAs that Eli Lilly's patent was invalid.

On April 27, Judge Tanya Walton Pratt entered final judgment against the defendants, prohibiting the sale of a Cymbalta generics and requiring that the defendants convert their certifications to a Paragraph III filing. The '269 patent provides protection for Cymbalta until at least June of 2013. The defendants also must notify the FDA that the defendants are no longer seeking approval for an ANDA. Eli Lilly argued that the group was bound by Judge Pratt's March approval of a settlement between the company and Wockhardt that favored the plaintiff. The judge's order ends Eli Lilly's case against Impax, Cobalt, Anchen, Actavis, Aurobindo, Lupin, Sandoz, and Sun.

Pfizer and Eon Settle Neurontin Patent Dispute

Pfizer and Eon Labs have reached an agreement ending their patent infringement suit over a generic version of the epilepsy drug Neurontin. In June 2000, Pfizer brought suit in the U.S. District Court for the District of New Jersey against Eon, after Eon filed an ANDA over gabapentin. In 2002, the case was joined with Pfizer's suits against other generic-drug makers Purepac and Teva. Despite the lawsuit, the defendants opted to begin selling their generic gabapentin products "at risk" before a court ruling on infringement liability had been issued. Pfizer asserted infringement of U.S. Patent No. 6,054,482 stemming from the ANDA and the sales of generic gabapentin. In August 2005, the District Court found no infringement because Pfizer failed to prove that the anions of the Neurontin generic drugs fall within the claims. Pfizer appealed the New Jersey court's decision to the Federal Circuit and it was reversed (see "In re Gabapentin Patent Litigation (Fed. Cir. 2007)").

On April 28, Judge Faith S. Hochberg signed off on a stipulation dismissing Eon and Sandoz from the case, leaving Purepac, Teva, and their affiliates as the only remaining defendants in the long-running patent suit, which is scheduled for trial on May 16. The companies stipulated that Eon's gabapentin capsules infringed Pfizer's patent and that all claims and counterclaims pending between the companies should be dismissed. The remaining terms of the settlement are confidential.
U.S. Trade Representative Releases Special 301 Report on Global IPR

May 4, 2011

By Kevin E. Noonan —

At the end of last month, the U.S. Trade Representative (USTR), Ronald Kirk, issued the 2011 Special 301 Report. According to the USTR website "[f]ighting [intellectual property rights, i.e.,] IPR theft in overseas markets is critical to the livelihoods of the estimated 18 million Americans who work in intellectual property-intensive industries." The USTR Report "provides a means for the United States to promote the protection and enforcement of IPR," according to the website announcement, noting that "for the first time, USTR has issued an open invitation to all trading partners listed in the report to cooperatively develop action plans to resolve IPR issues of concern." This is part of "a call to action" to all U.S. trading partners that the USTR says it is issuing with this Report. Ambassador Kirk asserts that the U.S. is "ready to work intensively with [our trading partners] to stop intellectual property theft that threatens IP-related jobs in the United States and other countries."

The Report is promulgated pursuant to Section 182 of the Trade Act of 1974, as amended by the Omnibus Trade and Competitiveness Act of 1988 and the Uruguay Round Agreements Act (enacted in 1994). The Trade Representative is required under the Act to "identify those countries that deny adequate and effective protection for IPR or deny fair and equitable market access for persons that rely on intellectual property protection." The Trade Representative has implemented these provisions by creating a "Priority Watch List" and "Watch List." Placing a country on the Priority Watch List or Watch List is used to indicate that the country exhibits "particular problems . . . with respect to IPR protection, enforcement, or market access for persons relying on intellectual property." These watch lists are reserved for countries having "the most onerous or egregious acts, policies, or practices and whose acts, policies, or practices have the greatest adverse impact (actual or potential) on the relevant U.S. products."

This report, on the state of intellectual property rights worldwide, identifies twelve countries on a "Priority Watch List" and another 28 countries on the "Watch List," all relating to deficiencies in intellectual property protection in these countries. The Priority Watch List in the Report lists China, Russia, Algeria, Argentina, Canada, Chile, India, Indonesia, Israel, Pakistan, Thailand, and Venezuela, the same countries that were on this list in last year's Report. Countries on this list "do not provide an adequate level of IPR protection or enforcement, or market access to persons relying on intellectual property protection." On the Watch List this year are Belarus, Bolivia, Brazil, Brunei, Columbia, Costa Rica, Dominican Republic, Ecuador, Egypt, Finland, Greece, Guatemala, Italy, Jamaica, Kuwait, Malaysia, Mexico, Norway, Peru, Philippines, Romania, Spain, Tajikstan, Turkey, Turkmenistan, Ukraine, Uzbekistan, and Vietnam; compared to last year, Lebanon has been removed from the list. Although many U.S. trading partners have acted to implement IPR protection into their national law, the Report "identifies a wide range of serious concerns, ranging from troubling a lack of criminal prosecutions and deterrent sentencing has reduced the effectiveness of IPR enforcement in many regions." This is the result, among other things, of a lack of knowledge of IPR law on the part of judges and enforcement officials, and insufficient enforcement resources," both areas the Report says the U.S. is ready to continue to "work collaboratively" to address.

The Report notes that public response to a Federal Register Notice used to prepare the Report reflected an "enhanced approach to public engagement" in this Report, with the USTR receiving 49 comments (access to these comments is provided at www.regulations.gov, docket number USTR-2010-0037). In addition, 17 witnesses provided testimony at a public hearing on March 2, 2011; these witnesses included "representatives of foreign governments, industry, and non-governmental organizations" (available on the USTR website).

The Report notes some "positive developments" in the past year, including work towards "finalizing" the Anti-Counterfeiting Trade Agreement (ACTA) between the U.S. and Australia, Canada, the European Union, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, and Switzerland; four separate pieces of IPR legislation in Russia relating to the 2006 Bilateral Agreement on Protection and Enforcement of Intellectual Property Rights; and "action" in Spain against copyright piracy on the Internet. In addition to ACTA, the Report cites the Trans-Pacific Partnership Agreement, between the U.S. and Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam; Trade Preference Program reviews such as the Generalized System of Preferences (GSP) program relating to Russia, Lebanon, and Uzbekistan, and regional programs including the Caribbean Basin Economic Recovery Act (CBERA); and bilateral free trade agreements (FTAs) and Trade and Investment Framework Agreements (TIFAs) as efforts in furtherance of greater IPR protection.

The Report contains a section on "best practices" among U.S. trading partners, which include "improved cooperation and stakeholder engagement [related to greater transparency]" in Argentina, Canada, Guatemala, Italy, Malaysia, Mexico, and Pakistan. Efforts in China and Russia to combat counterfeit drugs are commended, and the Report "strongly encourages foreign governments to make [IPR] training opportunities available to their officials." U.S. actions in this regard, including the USPTO's Global Intellectual Property Academy, "which conducts over 75 programs per year, training more than 4,500 participants from over 120 trading partners" are also mentioned, as is the State Department's International Visitors Leadership Program and programs run by the U.S. Copyright Office. U.S. efforts outside the country cited in the Report include agreements between the US PTO and "more than 40 national, regional, and international IPR organizations, such as the Caribbean Community (CARICOM), the Association of Southeast Asian Nations (ASEAN), the African Regional Intellectual Property Organization (ARIPO), the World Intellectual Property Organization (WIPO), the International Union for the Protection of New Varieties of Plants (UPOV), and Interpol, to partner on IPR training activities," and the Department of Commerce's International Trade Association and Commercial Law Development Program. Linking IPR protection with national security, the Report cites the Department of Homeland Security for its customs and border control activities, and training by DHS in Angola, Brunei, Egypt, Mali, Peru, Ukraine, and Thailand relating to IPR.

A significant part of the Report focuses on counterfeiting and copyright piracy, as it has in other years. This area has "evolved," according to the Report, "from a localized industry concentrated on copying high-end designer goods to a sophisticated global business involving the mass production and sale of a vast array of fake goods, including items such as counterfeit medicines, health care products, food and beverages, automobile and airplane parts, toothpaste, shampoos, razors, electronics, batteries, chemicals, and sporting goods." A greater variety of goods are being counterfeited and the counterfeits are more sophisticated, bearing the indicia (such as labels and trademarks) of the originators' goods. Free trade zones have been used as conduits for counterfeit goods, both for assembling and distributing the goods to other countries as well as disguising the origin of such goods. The result in many countries is a loss of tax and other revenue as well as increases in organized crime, which is attracted to the "enormous profits and little risk" involved (both low initial capitalization costs incurred and insignificant penalties imposed). The Report cites as evidence of increased sophistication separate shipment of counterfeit goods and their labels, wherein "unbranded products" are imported, packaged with counterfeit trademarks and packaging material, and then exported; Russia, Paraguay, Mexico and the Philippines are cited for such practices. Another "growing" problem is counterfeit pharmaceuticals, either final drug product or active pharmaceutical ingredients (API); Brazil, China, India, Indonesia, Lebanon, Peru, and Russia are cited as countries where the former type of counterfeiting is a problem and China is cited as being a "major source" of counterfeit APIs.

Another section of the Report is concerned with digital piracy, particularly over the Internet, facilitated by "[t]he increased availability of broadband Internet connections around the world." This is a "significant concern" in Brazil, Canada, China, India, Italy, Russia, Spain, and Ukraine, involving specifically "unauthorized retransmission" of sporting events. The Report cites improved technologies, including "mobile telephones, tablets, flash drives, and other mobile technologies" as exacerbating these problems, with some mobile devices being sold with "preloaded" illegal content in some countries. In addition to the traditional objects of counterfeiting (such as music and movies), counterfeiting is beginning to be a problem for "ring tones, 'apps', games, and scanned books." Countries where the U.S. "seek[s] to work" with local authorities to address this form of piracy include Argentina, Belarus, Brazil, Brunei, Canada, Colombia, India, Italy, Malaysia, Mexico, Philippines, Romania, Russia, Spain, Thailand, Turkey, Ukraine, Venezuela, and Vietnam.

As it has for the past few years, the Report contains a section on "Intellectual Property and Health Policy," again specifically mentioning the 2001 Doha Declaration on the TRIPS Agreement. The Report states that the Declaration "recognized the gravity of the public health problems afflicting many developing and least-developed countries, especially those resulting from HIV/AIDS, tuberculosis, malaria, and other epidemics," and that the U.S. "respects a trading partner's right to protect public health and, in particular, to promote access to medicines for all, and supports the vital role of the patent system in promoting the development and creation of new and innovative lifesaving medicines." Accordingly, the Report states that the U.S. "respects our trading partners' rights to grant compulsory licenses in a manner consistent with the provisions of the TRIPS Agreement, and encourages its trading partners to consider ways to address their public health challenges while maintaining intellectual property systems that promote investment, research, and innovation." On the other hand, the Report contains a section relating to the USTR's efforts to "reduce market access barriers faced by U.S. pharmaceutical and medical device companies in many countries," specifically calling out Algeria, Finland, Germany, Greece, Indonesia, Japan, Korea, New Zealand, Poland, and Taiwan as countries of particular concern in this regard.

The Report contains in a final section a review of U.S. activities in the WTO to resolve disputes with countries such as China and the EU over trade issues.

Section II of Report is a detailed, country-by-country discussion for each country on the Priority Watch List and the Watch List, relating to the activities (or lack thereof) of each country that results in placement of that country on these lists.

The U.S. Trade Representative Report provides insights into both the concerns of U.S. IP rights holders and the Administration's intentions to work with, cajole, coerce, or threaten other countries to increase protection for IP rights of U.S. IP rights holders. This year, the Report includes an invitation to U.S. trading partners for coordinated efforts in enforcing IPR:

USTR is pleased to announce a new initiative in the 2011 review, whereby it invites any trading partner appearing on the Special 301 Priority Watch List or Watch List to negotiate a mutually agreed action plan designed to lead to that trading partner's removal from the relevant list. . . . Through action plans and other engagement in the coming year, USTR looks forward to working with U.S. trading partners to address both emerging and continuing concerns, and to building on the positive results achieved thus far.

This initiative indicates that the attitude is one of cooperation against a common enemy (i.e., counterfeiters) rather than punitive action by the world's trade leader against foreign competitors. In the past, the U.S. and other Western governments have been frustrated, particularly with regard to pharmaceutical products, in implementation of international trade treaties designed to increase IP rights protection. This Report seems to indicate that the Administration now believes that achieving the goal of greater IPR enforcement and protection is better served by trying to convince our trading partners that such actions are in their best interest as well as ours. In view of past failures, it seems that this change in orientation may be the best option; its success no doubt will be a topic in next year's Report.

For additional information regarding this and other related topics, please see:

• "U.S. Trade Representative Releases Special 301 Report on Global IPR," May 19, 2010
• "New Administration, Same Result: U.S. Trade Representative's Section 301 Report," May 6, 2009
• "Congressmen Criticize U.S. Trade Representative over Special 301 Report," July 1, 2008
• "U.S. Continues Efforts to Protect Patent Rights Abroad," April 29, 2008
Protective Orders Put at Risk by New Bill

May 3, 2011

By Kevin E. Noonan —

Lost in all the hubbub over the America Invents Act (S. 23 and H.R. 1249, collectively "the patent reform bill"), Congress is considering another pair of bills (one in each House) that could have an equally deleterious effect on enforcing valuable patents. Identified as S. 623 (introduced by Senator Herb Kohl (D-WI), joined by Senators Lindsey Graham (R-SC) and Patrick Leahy (D-VT)) and H.R. 592 (introduced by Representative Gerald Nadler (D-NY)), the bills are called the "Sunshine in Litigation Act," and are intended to prevent courts from granting protective orders in certain cases.

Specifically, the bills require a ban on protective orders for any civil action "in which the pleadings state facts that are relevant to the protection of public health or safety," adding Section 1660 to Title 28, U.S. Code, Chapter 111. The bills constitute a Congressional "thou shalt not" for an order "otherwise authorized under rule 26(c) of the Federal Rules of Civil Procedure restricting the disclosure of information obtained through discovery, an order approving a settlement agreement that would restrict the disclosure of such information, or an order restricting access to court records." Such a protective order would be permitted only after a court makes "independent findings of fact" that "such [an] order would not restrict the disclosure of information which is relevant to the protection of public health or safety" or that "the public interest in the disclosure of past, present, or potential health or safety hazards is outweighed by a specific and substantial interest in maintaining the confidentiality of the information or records in question" and "the requested order is no broader than necessary to protect the confidentiality interest asserted." In addition, the bills would prohibit any protective order (except for an order approving a settlement agreement) from continuing in place after final judgment is entered, unless the court "makes a separate finding of fact" at that time that the requirements of the statute balancing the private interest in secrecy with the public's "right to know" (based on the effect of the information on "public health or safety") continue to favor the protective order. A party that is the "proponent" of the protective order would bear the burden of establishing the requirements of the statute. Stipulation between the parties would not overcome the onus placed on the court for independent fact-finding (and the presumption against entering or maintaining a protective order) before such an order could be put into place. The bills also provide that "[t]he provisions [thereof] . . . shall not constitute grounds for the withholding of information in discovery that is otherwise discoverable" under the Federal Rules of Civil Procedure.

The bills contain similar provisions prohibiting a court from enforcing any provisions in a settlement agreement between private parties that would prohibit any party from disclosing "the fact that such a settlement was reached or its terms" (except the amount of money damages) or from "discussing a civil action, or evidence produced in the civil action, that involves matters relevant to the protection of public health or safety." Unless, of course, the court makes the independent factual findings that the public's right to know is outweighed by the parties' private interest in that information remaining secret. Moreover, the bills create a rebuttable presumption that a party's interest in "personally identifiable information" that relates to "financial, health or similar information of an individual outweighs the public interest in disclosure."

In a separate provision, each of the bills would prevent a court from giving effect to an order "to the extent that such provision or such order prohibits or otherwise restricts a party from disclosing any information relevant to such civil action to any Federal or State agency with authority to enforce laws regulating an activity relating to such information." Information disclosed to such an agency could remain confidential "to the extent provided by law," there not being any intention to abrogate other statutory protections.

The motivation for introducing these bills is products liability litigation, specifically in instances where companies have imposed non-disclosure provisions in settlement agreements. Senator Kohl (at left) made the case in these terms when he introduced the Senate version of the bill on March 17th. In remarks entered into the Congressional Record, the Senator stated that the bill was intended to "curb the ongoing abuse of secrecy orders in Federal courts . . . [that] keep[s] important health and safety information hidden from the public." He characterized his "bipartisan" bill as a "commonsense measure" that is "an important step to improving transparency in our courthouses by requiring judges to consider public health and safety before permitting secrecy agreements." This problem "most often arises in product liability cases," the Senator said, citing "a long history" of "tobacco companies, automobile manufacturers, pharmaceutical companies, medical device manufacturers, and others," and enumerated several purported instances, including automobile accidents caused by defective Bridgestone/Firestone tires; Toyota's recall of over 8 million cars due to sudden unintended acceleration problems; clinical studies about the harmful side effects of AstraZeneca's antipsychotic drug, Seroquel; explosions of "side saddle" fuel tanks in General Motors pickup trucks; and even the possibility of secrecy orders in cases stemming from the BP oil spill in the Gulf of Mexico last year. The Senator recounted as "typical" an individual plaintiff suing a large corporation and being coerced into agreeing to keep the corporation's culpability secret as a condition for a financial settlement necessary to compensate the individual for medical and other damages caused by a defective product. While this outcome may be adequate for the individual plaintiff, it is "the American public [that] incurs the loss because they remain unaware of critical public health and safety information that could potentially save lives," the Senator said. Similar sentiments can be found in press releases and on the websites of the other sponsors of the House and Senate bills.

Regardless of whether the protections of these bills are necessary or will be sufficient to achieve the sponsors' goals, one immediate consequence of these provisions will be to put pharmaceutical and biotechnology companies at risk in any litigation. Frequently, protective orders are entered in cases involving these companies to prevent disclosure of trade secrets, including technical know-how and valuable business information regarding prospective new uses and avenues of research. Biotech and pharma patentees have a legitimate interest in keeping such information secret, but the nature of their businesses could easily be characterized as involving "public health." The bill contains no definitions limiting the application of its provisions to products liability lawsuits, regardless of its sponsors' protestations of their intent; the case law is replete with decisions invoking the principle that the intent of an individual Member of Congress, even a sponsor, in introducing litigation is not dispositive on the scope of the bill when enacted into law. The bill also provides the opportunity for manipulation by litigants, insofar as the threat of litigation (and the disclosure mandated by the Federal Rules not trumped by the provisions of this proposed statute) could be used to obtain an advantage over patentee plaintiffs. This makes the bill particularly dangerous for biotech and pharma companies, since the multiple interests (especially the interest in lower drug costs regardless of the actual costs of developing such drugs) make the ultimate decision fraught with political consequences that overshadow the disputes and issues between private party litigants that might otherwise limit the extent of any public interest in disclosure of such private information.

The effective date of the statute is 30 days after enactment and will apply only to actions commenced thereafter and apply to protective orders or settlement agreements entered on or after that date. The Senate bill is slated to be marked up on Thursday, May 5th by the Senate Judiciary Committee for passage to the floor for a vote.
USPTO Proposes Changes to Streamline Reexamination Proceedings

May 2, 2011

By Donald Zuhn —

Last week, the U.S. Patent and Trademark Office published a notice in the Federal Register (76 Fed. Reg. 22854) proposing a number of changes to ex parte and inter partes reexamination proceedings. In addition, the USPTO announced that it was seeking public comment regarding the proposed changes and that the Office would be holding a public meeting on June 1, 2011 to discuss the proposed changes.

The notice indicates that the proposed changes are intended to streamline the procedures governing ex parte and inter partes reexamination proceedings, by seeking to achieve faster, more efficient resolution of the substantial new question of patentability (SNQ) for which reexamination is ordered. While some of the proposed changes discussed in the notice impact both ex parte and inter partes reexamination proceedings, other changes are specific to either ex parte or inter partes reexamination proceedings.

Changes impacting both ex parte and inter partes reexamination proceedings include:

• Require requester to separately explain how each SNQ presented in the request is "new" relative to other examinations of the patent claims (rather than merely stating what the SNQ is believed to be).
• Require requester to explain how the references apply to every limitation of every claim for which reexamination is requested.
• Require requester to explain how multiple SNQs raised in the same request are non-cumulative of each other; cumulative SNQs will be deemed to constitute a single SNQ.
• Permit the examiner to select one or more representative rejections from among a group of adopted rejections.
• Limit requester's declaration and other evidence mainly to the request — new evidence may be submitted only to rebut point made in Office action or patent owner's response or statement.
• Limit patent owner's amendments and evidence mainly to the first action response — new amendments or evidence may be submitted in response to new ground of rejection.
• Prohibit entry of claim amendments unless accompanied by a statement explaining how the proposed new claim language renders the claims patentable in light of an SNQ.
• Clearly define petitions practice (see table listing examples of petitions filed in reexamination proceedings on page 22858 of the Office's notice).

Changes specific to ex parte reexamination proceedings include:

• Make permanent the pilot procedure allowing patent owner to optionally waive patent owner's statement — the notice indicates that only about 10% of patent owners file a statement under 35 U.S.C. § 304.
• Where the patent owner does not waive the statement, the order granting reexamination will include a provisional first Office action on the merits (FAOM), which may be made final in the next action.

Changes specific to inter partes reexamination proceedings include:

• Allow third party requester to dispute the examiner's designation that a rejection is "representative" of other rejections in the group.
• Final Office action will close prosecution and trigger appeal rights.
• Limit third party requester's appellant brief to appealing an examiner's decision that a claim is patentable; additional bases to cancel a rejected claim can only be argued in a respondent brief following patent owner's appellant brief.

A detailed description of each proposed change can be found in the Office's notice. In addition, the notice provides a list of thirteen questions on page 22860 for which the Office seeks comments.

The public meeting to be held on June 1 is scheduled to begin at 1:30 pm (EST) and will be held in the South Auditorium of Madison West, 600 Dulany Street, Alexandria, VA. Those interested in attending the meeting must register by 5:00 p.m. (EST) on May 25, 2011; those interested giving a presentation at the meeting must register by sending an e-mail to reexamimprovementcomments@uspto.gov by 5:00 p.m. (EST) on May 11, 2011. Additional information regarding registration is provided in the notice (see page 22860 for information registrants should provide).

Written comments regarding the proposed changes to ex parte and inter partes reexamination proceedings must be submitted by June 29, 2011. Written comments can be submitted by e-mail to reexamimprovementcomments@uspto.gov, or mail to: Mail Stop Comments-Patents, Commissioner for Patents, P.O. Box 1450, Alexandria, VA 22313–1450, marked to the attention of Kenneth M. Schor.
USPTO Publishes Notice Regarding Prioritized (Track I) Examination Delay

May 1, 2011

By Donald Zuhn —

In a short, two-column notice published on Friday in the Federal Register (76 Fed. Reg. 23876), the U.S. Patent and Trademark Office reiterated that the effective date for implementation of the prioritized examination (or Track I) portion of the Enhanced Examination Timing Control Initiative has been delayed until further notice. Under the Track I procedure, applicants can request prioritized examination at the time of filing of an application upon payment of appropriate fees ($4,000 in addition to standard filing fees) and compliance with certain requirements (as outlined in a final rule published on April 4, 2011).

While the USPTO's April 4 notice indicated that the Patent Office would begin accepting Track I applications on May 4, 2011, USPTO Director David Kappos sent a message to Patent Office employees, notifying them that "[t]he Track One expedited patent examination program, scheduled to go into effect on May 4, 2011, is postponed until further notice" (see "USPTO News Briefs," April 21, 2011). Since that notice, the Director has addressed the postponement on his blog and the USPTO has issued a press release regarding the postponement (see "USPTO News Briefs," April 27, 2011).

The Office's latest notice states that "[t]he effective date for the amendments to 37 CFR 1.17 and 1.102 published at 76 FR 18399, April 4, 2011 (the Track I final rule) is delayed until further notice." The notice indicates that a new effective date will be published in the Federal Register (at some future, unspecified date). Most importantly, the notice states that "[n]o request for prioritized examination will be accepted until further notice." With regard to the reason for delaying the program, the Office explains that it:

[H]as found it necessary to revise its patent examiner hiring plan due to funding limitations. The revised hiring plan does not permit the Office to hire new examiners. With the current level of resources, the Office will not be able to meet the twelve-month pendency goal in prioritized examination applications without impacting the non-prioritized examination applications at this time.

With respect to the new effective date, the Office further explains that "[w]hen the funding limitations are resolved, the Office will issue a subsequent notice identifying a revised effective date and applicability date on which the final rule shall apply."
Court Report

May 1, 2011

By Sherri Oslick —

About Court Report: Each week we will report briefly on recently filed biotech and pharma cases.

Daiichi Sankyo Inc. et al. v. Watson Pharmaceuticals Inc. et al.
1:11-cv-00345; filed April 18, 2011 in the District Court of Delaware

• Plaintiffs: Daiichi Sankyo Inc.; Genzyme Corp.
• Defendants: Watson Pharmaceuticals Inc.; Watson Pharma Inc.; Watson Laboratories Inc. (NV)

Infringement of U.S. Patent Nos. 5,607,669 ("Amine Polymer Sequestrant and Method of Cholesterol Depletion," issued March 4, 1997) and 5,693,675 ("Alkylated Amine Polymers," issued December 2, 1997) following a Paragraph IV certification as part of Watson's filing of an ANDA to manufacture a generic version of plaintiffs' Welchol® (colesevelam hydrochloride, used to treat primary hyperlipidemia and type 2 diabetes mellitus). View the complaint here.

Abraxis Bioscience, LLC v. Kappos
1:11-cv-00730; filed April 15, 2011 in the District Court of the District of Columbia

Review and correction of the patent term adjustment calculation made by the U.S. Patent and Trademark Office for U.S. Patent No. 7,820,788 ("Compositions and Methods of Delivery of Pharmacological Agents," issued October 26, 2010). View the complaint here.

Allergan, Inc., et al. v. Sandoz, Inc.
1:11-cv-00298; filed April 15, 2011 in the Middle District of North Carolina

• Plaintiffs: Allergan, Inc.; Duke University
• Defendant: Sandoz, Inc.

Infringement of U.S. Patent Nos. 7,351,404 ("Method of Enhanced Hair Growth," issued April 1, 2008), 7,388,029 ("Compositions and Methods for Treating Hair Loss Using Non-Naturally Occurring Prostaglandins," issued June 17, 2008), and 6,403,649 (""Non-Acidic Cyclopentane Heptanoic Acid,2-Cycloalkyl Or Arylalkyl Derivatives As Therapeutic Agents, issued June 11, 2002) following a Paragraph IV certification as part of Sandoz's filing of an ANDA to manufacture a generic version of Allergan's Latisse® (bimatoprost topical solution/drops, 0.03%, used to treat inadequate or not enough eye lashes). View the complaint here.

Celgene Corp. et al. v. Actavis South Atlantic LLC
2:11-cv-02162; filed April 15, 2011 in the District Court of New Jersey

• Plaintiffs: Celgene Corp.; Novartis Pharmaceuticals Corp.; Novartis Pharma AG
• Defendants: Actavis South Atlantic LLC

Infringement of U.S. Patent Nos. 5,908,850 ("Method of Treating Attention Deficit Disorders with d-Threo Methylphenidate," issued June 1, 1999), 6,355,656 ("Phenidate Drug Formulations Having Diminished Abuse Potential," issued March 12, 2002, with a reexamination certificate issued March 27, 2007), 6,528,530 ("Phenidate Drug Formulations Having Diminished Abuse Potential," issued March 4, 2003), 5,837,284 ("Delivery of Multiple Doses of Medications," issued November 17, 1998), 6,635,284 (same title, issued October 21, 2003), and 7,431,944 ("Delivery of Multiple Doses of Medications," issued October 7, 2008) all licensed exclusively to Novartis in certain fields of use, following a Paragraph IV certification as part of Actavis' filing of an ANDA to manufacture a generic version of Novartis' Focalin XR® (extended release dexmethylphenidate hydrochloride, used to treat attention deficit hyperactivity disorder). View the complaint here.

Abbott Laboratories et al. v. Mathilda and Terence Kennedy Institute of Rheumatology Trust
1:11-cv-02541; filed April 13, 2011 in the Southern District of New York

• Plaintiffs: Abbott Laboratories; Abbott Biotechnology Ltd.
• Defendant: The Mathilda and Terence Kennedy Institute of Rheumatology Trust

Declaratory judgment of invalidity of U.S. Patent No. 7,846,442 ("Methods of Treating Rheumatoid Arthritis with an Anti-TNF-Alpha Antibodies and Methotrexate," issued December 7, 2010) in conjunction with Abbott's manufacture and sale of its Humira® (adalimumab, used to treat rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, Crohn's disease and plaque psoriasis). View the complaint here.

Human Genome Sciences Inc. v. Genentech Inc. et al.
1:11-cv-00328; filed April 12, 2011 in the District Court of Delaware

• Plaintiff: Human Genome Sciences Inc.
• Defendants: Genentech Inc.; City of Hope

Declaratory judgment of invalidity, unenforceability, and non-infringement of U.S. Patent No. 7,923,221 ("Methods of Making Antibody Heavy and Light Chains Having Specificity for a Desired Antigen," issued April 12, 2011) in conjunction with HGS's manufacture and sale of its Benlysta® (belimumab, under development for the treatment of seropositive patients with systemic lupus erythematosus) product. View the complaint here.

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