Posts Tagged: "Hatch-Waxman Act"

Out of the 230 Orange Book patents challenged in IPR proceedings, 90.4% (208) of these patents were also challenged in Hatch-Waxman litigation perhaps due to the lucrative 180-day exclusivity incentive available to the first generic manufacturer to file a paragraph IV challenge when the Orange Book drug patent is successfully invalidated in a subsequent district court proceeding. Therefore, the IPR process has provided generic manufacturers a dual track option for challenging Orange Book patents by initiating Hatch-Waxman litigation and also pursuing IPRs. Overall, because the rate of settlement in IPRs is much lower than in Hatch-Waxman litigation, both generic manufacturers and patent owners obtain more favorable final decisions in IPRs as compared to their Hatch-Waxman litigation outcomes.

The Federal Circuit reversed the District of Delaware’s decision to invalidate Orexo’s opioid treatment patent as obvious because obviousness was not proved by clear and convincing evidence. Specifically, the Court pointed to the absence of a teaching in the prior art that citric acid could serve as a carrier particle for the drug agonist.  The Court also noted that the lower court improperly discounted evidence of objective indicia of nonobviousness.

While the changes to the Trial Practice Guide begin to move the rules in the right direction, more is needed before post-grant proceedings will be accepted as neutral to all parties.  The PTAB should endeavor to adopt the time-honored burdens, presumptions and procedures used in the district courts for trying patent cases whenever reasonably possible.  Petitioners should be required to prove that the art upon which they rely is not cumulative to that previously before the USPTO, a patent owner’s Preliminary Response presenting evidence raising genuine issues of material fact should be treated as it would be if presented in opposition to a summary judgment motion brought in the courts, and the presiding panel should determine witness credibility by hearing testimony and cross examination live.

In order to establish that the commercial success factor supports a non-obviousness finding, the patentee must establish that a connection (or nexus) exists between the novel aspects of the patent claim(s) and the alleged commercial success. Id.; WesternGeco LLC v. ION Geophysical Corp., 889 F.3d 1308, 1330 (Fed. Cir. 2018). In other words, the patentee must show that the novel aspects of the claim(s) are driving sales and not aspects of the claim(s) that were known in the prior art. In re Huai-Hung Kao, 639 F.3d 1057, 1069 (Fed. Cir. 2011); WesternGeco, 889 F.3d at 1330. In cases brought pursuant to the Hatch-Waxman Act, while there are exceptions, it is most common that patent challengers’ arguments focus predominantly or entirely on an alleged lack of nexus given the substantial sales typically enjoyed by the brand-name drug products that are the subject of such litigation. Though it bears noting that the mere fact that a company is pursuing a generic version of a brand-name drug, by itself, does not support a “commercial success” finding. Galderma Labs., Inc. v. Tolmar, Inc., 737 F.3d 737, 740 (Fed. Cir. 2013).