Lugar de Noticias Haynes and Boone

Recent U.S. Court Decisions Regarding Section viii "Carve-Outs"
05/15/2012
Stephanie Sivinski

Three recent decisions bolster a generic manufacturer’s ability to challenge Orange Book listings and obtain ANDA approval through section viii “carve-outs.” In Caraco v. Novo Nordisk1 the U.S. Supreme Court unanimously held Caraco could use the Hatch-Waxman’s counterclaim provision to correct Novo’s overbroad use code. In AstraZeneca v. Apotex, the U.S. Court of Appeals for the Federal Circuit held that Apotex’s ANDA for unpatented uses did not infringe AstraZeneca’s method patent.2 In Bayer v. Lupin,3 the Federal Circuit upheld dismissal under Rule 12(c), finding Bayer had not stated a claim for infringement and signaling greater willingness to dismiss frivolous infringement claims early in the litigation. A more detailed discussion follows.

Caraco Pharm. Indus. v. Novo Nordisk (Prandin)

The FDA requires brand manufacturers to provide use codes describing any method of use patents listed in the Orange Book, but does not verify the accuracy of these use codes. A generic company can obtain approval of its ANDA by “carving out” the patented methods of use and seeking a label covering only unpatented approved uses. But the FDA will not approve an ANDA for any use covered by the brand’s use codes. Therefore, an overbroad use code may prevent a generic from obtaining approval by hindering the use of section viii to carve out the patented methods and label only for the unpatented approved use(s).

In this case, Novo’s method patent and original use code on the diabetes drug Prandin (repaglinide) covered only repaglinide in combination with the drug metformin. Caraco sought ANDA approval for the use of repaglinide alone or with thiazolidinediones, but not with metformin. After Caraco filed its ANDA, Novo broadened its use code to cover all uses of repaglinide to regulate blood glucose, including the uses on which Caraco sought approval.

Novo sued for infringement and Caraco counterclaimed under 21 U.S.C. § 355(j)(5)(C)(ii)(I) seeking correction of Novo’s use code, specifically, to require that Novo narrow its use code. The District Court ordered correction but the Federal Circuit reversed, finding no statutory basis for Caraco’s counterclaim. The Federal Circuit held that Caraco could only use the counterclaim provision if the method patent failed to cover any of the approved uses. In this case, Novo’s patent covered the approved use of repaglinide in combination with metformin, and accordingly the Federal Circuit decision meant that Caraco’s counterclaim must fail.

The Supreme Court reversed, however, finding the Federal Circuit’s statutory interpretation incorrect. The Supreme Court reasoned that a generic company could seek correction of a brand’s listed patent information, including an overbroad use code. The remedy of correction would only be useful when, like here, the listed patent covered one but not all approved methods of use. Accordingly, a generic manufacturer can now counterclaim to seek correction of an overbroad use code. The decision prevents a brand company from using overbroad use codes as an offensive weapon against ANDA approval, and preserves the use of section viii “carve-outs.”

AstraZeneca v. Apotex (Crestor)

Apotex sought ANDA approval for a generic form of AstraZeneca’s (“AZ”) cholesterol-lowering drug Crestor (rosuvastatin calcium). Apotex filed a section viii certification “carving out” the patented uses, that is, Apotex only sought approval for uses that the listed method patent did not cover. In response to Apotex’s ANDA, AZ filed suit for patent infringement, alleging that the ANDA constituted infringement of its method patent.

The District Court dismissed AZ’s claim, finding that it had not stated a claim for relief under 35 U.S.C. § 271(e)(2). Under that provision, an ANDA constitutes infringement only if it seeks approval for a drug claimed in a patent or the use of which is claimed in a patent. In this case, Apotex certified that it only sought approval for non-patented methods of use. Accordingly, Apotex’s ANDA did not constitute infringement.

On appeal, AZ argued that patients would use the generic drug in an off-label and infringing way. Further, the FDA would likely block the carve-out on the basis that it rendered the drug less safe or effective. The Federal Circuit found these arguments were not ripe, and affirmed the District Court’s dismissal on the basis that an ANDA seeking to market a drug for unpatented methods cannot infringe a method patent under 35 U.S.C. § 271(e)(2)(A). Further, AZ’s position would render section viii “carve-outs” useless.

Bayer v. Lupin and Bayer v. Sandoz (Yasmin)

Bayer’s method patent covering the oral contraceptive Yasmin (drospirenone/ethinyl estradiol) claimed the use of Yasmin for simultaneously achieving a contraceptive, anti-androgenic, and anti-aldosterone effect in female patients. The ANDA filers sought approval for Yasmin only as an oral contraceptive.

Bayer filed suit claiming the ANDAs infringed its method patent. The generics moved for judgment of noninfringement under Rule 12(c), arguing that the ANDA did not seek approval of the “simultaneous” uses covered by the method patent and therefore did not infringe. There was no evidence that the generics promoted their drugs for anti-androgenic and anti-aldosterone effects, and therefore no evidence of inducement.

The Federal Circuit affirmed the dismissal, finding that the FDA had not approved the ANDA for the three simultaneous patented uses. In doing so, the court looked to the totality of the circumstances surrounding the generic label. While the generic labels indicated the drug’s alternate effects, they did not suggest the drug would safely and effectively produce an anti-androgenic or anti-aldosterone effect.

If you have any questions regarding these matters, please contact one of our patent attorneys.

Jeffrey Wolfson
202.654.4565

Kyle Musgrove
202.654.4502
 

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1 Caraco Pharmaceutical Industries v. Novo Nordisk, No. 10-844 (U.S. April 17, 2012).
2 AstraZeneca Pharmaceuticals LP v. Apotex, Corp., Nos. 2011-1182 through 2011-1190 (Fed. Cir. Feb. 9, 2012).
3 Bayer Schering Pharma AG v. Lupin, Ltd. and Bayer Schering Pharma AG v. Sandoz, Inc., Nos. 2011-1143, -1228 (Fed. Cir. April 16, 2012).