Apotex Bid to Steal Mylan Exclusivity on Benicar


04.23.15 Posted in Federal Circuit Opinions by

In this matter, Mylan is sitting on a likely 180-day exclusivity for being the first-to-file generic for Benicar®, olmesartan medoximil. Apotex has now initiated a declaratory judgment action attempting to trigger a forfeiture event for this product. If Apotex is successful, Mylan could lose its exclusivity.

The Orange Book patents for this product are straightforward. US5616599 expires covers the compound and expires 10/25/2016 with pediatric exclusivity, and US6878703 expires 11/19/2021 and covers methods of use. The patents are owned by Daiichi.

Mylan was the first-to-file, in April 2006. Mylan sent Daiichi the required PIV notice. Daiichi responded by suing Mylan for patent infringement on the ‘599 patent. But Daiichi filed a statutory disclaimer to the ‘703 patent, so the ‘703 patent was not litigated. Daiichi prevailed in that litigation, so Mylan’s earliest entry date is on the expiry of the ‘599 patent. Mylan’s PIV certification remains intact with respect to the ‘703 patent, so Mylan is eligible for the 180-day exclusivity. No forfeiture event applied to Mylan because the ‘703 patent was not litigated (until now).

Apotex was a subsequent ANDA filer, and filed a PIII to the ‘599 and a PIV to the ‘703 patent. Daiichi did not sue Apotex – the ‘703 patent was disclaimed.

So Apotex, seeking to trigger a forfeiture event that would not otherwise occur, filed a declaratory judgment action seeking a declaration that its ANDA did not infringe the ‘703 patent. If successful, this could trigger the forfeiture under 21 USC §355(j)(5)(D)(i)(bb)(AA), of failure to market the product within 75 days of a decision from which no appeal (except certiorari) can be taken that the patent is invalid or not infringed. If the forfeiture is triggered, Mylan loses its exclusivity and Apotex can enter the market earlier than it would if it had to wait for Mylan’s exclusivity to run.

At the district court, Mylan won a dismissal on the ground that Apotex could not infringe a disclaimed patent, so no controversy existed.

Federal Circuit Conclusions

On appeal, the Federal circuit reversed the dismissal. The panel held that:

  • Daiichi’s disclaimer removed one, “but only one,” legal barrier to Apotex’s ability to enter the market. The legal stakes for the parties are high. If Apotex prevailed, it could (if the timing was right), enter the market without having to wait for Mylan’s exclusivity to run. Mylan, of course, could lose its exclusivity. And, Mylan’s exclusivity would also benefit Daiichi by minimizing price erosion during the exclusivity period.
  • The harm to Apotex (i.e., of having to wait for Mylan’s exclusivity to run) is traceable to Daiichi. Traceability is a constitutional requirement to press a legal action in the courts. Daiichi listed the patent in the Orange Book, and in so doing, Mylan and Daiichi get the potential benefit of the 180-day exclusivity.
  • Daiichi and Mylan argued that Apotex’s claim was speculative – because Apotex has apparently not yet received tentative approval, and may not get it in time. The panel rejects this out of hand. Tentative approval is never a requirement for a patent infringement action under the Hatch-Waxman scheme, because of the statutory infringement created by filing an ANDA with a PIV certification codified in 35 U.S.C. 271(e)(2).
  • Apotex’s strategy, if successful, can trigger the forfeiture. If Apotex gets tentative approval, which is possible prior to the expiry of the ‘599 patent, then the failure to market part (bb) comes into play. And if Apotex gets a final decision from which no appeal (other than a certiorari to the Supreme Court) has been or can be taken that the patent is invalid or not infringed, then (AA) is triggered, and a 75 day clock starts. If Mylan can’t launch within the 75 day period, the forfeiture event occurs and Mylan will lose its exclusivity. This could happen, for example, if Apotex gets tentative approval and a final decision earlier than 75 days before the expiry of the ‘599 patent, because Mylan can’t launch until the ‘599 patent expires.

Comment

This is a clever strategy by Apotex that plays into the hand of forces opposed to exclusivity. Generics may want to consider this strategy who are not first-to file-but who are not sued after filing of a PIV certification, to gain faster approval without having to wait for an exclusivity period to run.

I don’t have any great advice for Mylan in this case. Subjectively, it looks like they did as good a job as they could given the circumstances. Unfortunately for Mylan, they are on the wrong side of the fence with respect to the MMA amendments that have eroded the 180-day exclusivity benefit.

According to the docket at the N.D. of Illinois, this matter is back in the court. Apotex will probably oppose any deadline extensions in this case! Apotex must get this matter through the district court and up to the Federal Circuit on or before 76 days prior to the expiry of the ‘599 patent to trigger its forfeiture, so they need to rush at this point.

Shortcut to this post: goo.gl/dYTSZI

Case Citation

Apotex Inc. v. Daiichi Sankyo, Inc., No. 2014-1282, 2014-1291 (Fed. Cir. 3/31/2015). Panel was Taranto, Mayer, Clevenger, opinion by Taranto.



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