The Pharmaceutical Corner – The Impact of the Federal Circuit’s Definition of “All Substantial Rights” in Obvious Double Patenting

The obviousness double patenting doctrine was created to prevent an inappropriate patent term extension in commonly held patents. In Immunex versus Sandoz, the Federal Court adopted the “all substantial rights” test to determine common ownership, paving the way for licensed patents to be the subject of an obviousness double patent attack with the patentee’s own patents. license used as references of prior art. While the Federal Circuit applied the “all substantial rights” test, it ultimately upheld the validity of certain patents covering Enbrel®, a popular arthritis and psoriasis drug marketed by Amgen (which acquired Immunex in 2001 ).

Sandoz asked the Supreme Court for a writ of certiorari, asking for a review of the Federal Circuit’s decision. Sandoz argued that the Federal Circuit’s determination that the terms of Immunex’s exclusive license to the patents at issue did not encompass “all substantive rights” would allow patent owners to unacceptably extend exclusivity. by purchasing similar licenses. See Motion for writ of certiorari, Sandoz Inc. v. Immunex Corp., 2021 WL 53114, at * 1 (n ° 20-1110, January 29, 2021). The Supreme Court, however, rejected Sandoz’s petition on May 17, 2021.

This article describes the underlying appeal decision and the potential implications for pharmaceutical patent licensing strategies.

History of the procedure and opinion of the Federal Circuit

After Sandoz filed for an abbreviated biologic license to market a biosimilar version of Enbrel®, Roche and Immunex / Amgen filed an infringement action. Sandoz stipulated the infringement but argued that the patents were invalid for a number of reasons, including obviousness double patenting. After a two-week trial in the District of New Jersey, the district court declared the patents valid and issued a final judgment for Immunex / Amgen and Roche in late 2019.

Sandoz appealed, arguing that the district court erred in ruling that the patents were not held in common.

The common ownership issues in this case arise from the terms of the license between Roche and Immunex / Amgen. In the 1990s, the two companies investigated tumor necrosis factor (TNF) receptors separately to determine whether TNF suppression would result in therapeutic benefit. Roche filed the applications for what became the relevant patents in 1995. After Immunex obtained FDA approval to market Enbrel® in 1998, Immunex was granted a license for Roche’s patent applications.

In 2004, the parties amended the terms of the license, with Roche granting Immunex an irrevocable and exclusive license to the patent family for the patents at issue. Immunex has the exclusive right to sub-license, to sue the patent family, the right to obtain an assignment of patents for $ 50,000, and the first right to rectify any infringement with the right to retain any reward in arising. Roche retains the right to exercise patents for internal non-clinical research and has the secondary right, but not the obligation, to rectify the infringement with 180 days written notice to Immunex. The obligations of neither party under the contract are not assignable without written consent.

On appeal, Sandoz argued that the continuing Federal Circuit case law – an agreement that transfers “all substantive rights” to a patent amounts to an assignment – should also be an operational test for common ownership in obviousness-type double patents. . Since the license effectively granted the relevant patents to Immunex, prior Immunex patents should count as double patent references.

The majority adopted Sandoz’s legal theory, noting that when a party receives the right to sue the patent in question, the “all substantive rights” test is instructive in identifying the actual patentee in the analysis of “ownership. common ”. But the court also ruled that Roche’s retention of a secondary performing right and the non-transferability of the contract preserved the status of the agreement as a license.

Dissent adopted the same “all substantive rights test,” but found common property. Specifically, the Dissent noted that Immunex amended the claims after obtaining the rights to sue to claim the same protein as the patents owned by Immunex already protecting Enbrel®, and that, in the Dissent’s view, the rights retained by Roche were illusory – they did limit Immunex’s enjoyment of the patents at issue.

Sandoz’s request for certiorari

Sandoz, in its certiorari petition, emphasized the centrality of the concept of a patent by invention which underlies the judicial doctrine of obvious double patenting. Above all, according to Sandoz, Immunex has already benefited from a period of exclusivity for Enbrel® on the basis of its own patents. Sandoz cited the Amici Association for Accessible Medicines and America’s Health Insurance Plans, which argued that the Federal Circuit opinion provides a model for patent holders to unduly gain a second monopoly.

Immunex’s opposition pointed out that the Federal Circuit applied the legal standard proposed by Sandoz, and Sandoz only challenged the factual application. The grounds for certiorari have been undermined by the fact that the Federal Circuit’s opinion does not depart from established precedent and the legal statement is unclear. This is a factual query, argued Immunex, which is “ill-suited to the Court’s consideration.” Statement of opposition to certiorari’s motion for writ, Sandoz Inc. v. Immunex Corp., 2021 WL 1614843, at * 2 (n ° 20-1110, April 12, 2021).

Potential impact of the case

Since the Federal Circuit’s decision will not be reviewed by the Supreme Court, it could have a significant impact on pharmaceutical licensing and patent protection. The Federal Circuit has been extremely cautious, limiting the application of the “all substantial rights” test in obvious double patenting to situations where the right to sue a patent has been transferred so as not to disrupt collaborative efforts and license. Future litigants will likely test the limits of the “all substantive rights” test.

As it stands, the case provides useful advice for collaborative pharmaceutical innovators. Stakeholders should be aware of the rights retained by each party in patent licensing agreements. Maintaining performing rights and alienation control commensurate with the rights retained by Roche in this case will avoid triggering an obvious double patent challenge for the licensed patents or the licensee’s own portfolio.


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