Angiotech Pharm. Inc. v. Lee

Citation191 F.Supp.3d 509
Decision Date08 June 2016
Docket NumberCase No. 1:15-cv-1673
Parties ANGIOTECH PHARMACEUTICALS INC., Plaintiff, v. Michelle K. LEE, et al., Defendants.
CourtU.S. District Court — Eastern District of Virginia

Damon William Wright, Joshua Counts Cumby, Venable LLP, Washington, DC, for Plaintiff.

Andrew Han, US Attorney's Office, Alexandria, VA, for Defendants.

MEMORANDUM OPINION

T. S. Ellis, III, United States District Judge

In this Administrative Procedure Act ("APA")1 case, plaintiff Angiotech Pharmaceuticals Inc., the exclusive licensee of U.S. Patent No. 5,811,447 ("the '447 patent") and the agent of the '447 patent's owner for purposes of this action, challenges the United States Patent and Trademark Office's ("PTO")2 final decision denying a patent term extension for the '447 patent. In addition to holding the rights to the '447 patent, plaintiff also manufactures the ZILVER® PTX Drug Eluting Peripheral Stent

("Zilver PTX"), a medical device that physically and biologically stents arteries. The '447 patent claims a method of biological stenting to prevent the narrowing of mammalian arteries, and in plaintiff's view, the '447 patent claims a method of biological stenting using the Zilver PTX. Because the Zilver PTX could not be marketed until the completion of a lengthy review and approval process by the Food and Drug Administration ("FDA"), plaintiff seeks a patent term extension for the '447 patent pursuant to the Drug Price Competition and Patent Term Restoration Act of 1984, commonly referred to as the Hatch- Waxman Act.3 The PTO denied plaintiff's application for a term extension on the ground that the '447 patent does not claim a method of using the Zilver PTX and therefore does not qualify for a term extension under the Hatch-Waxman Act. This action followed.

The parties filed cross-motions for summary judgment, which have now been fully briefed and argued. Accordingly, the motions are now ripe for disposition.

I.
A.

At the outset, a brief overview of the pertinent statutory and regulatory framework is useful. The FDA oversees the review and market approval of new drugs and medical devices pursuant to the Federal Food, Drug, and Cosmetic Act ("FDCA").4 The nature of FDA review of a new drug or medical device depends on the nature of the product; for example, a new drug receives a review that differs from the review of a new medical device. See 21 U.S.C. § 355 (new drugs), § 360e (certain medical devices). Yet, some products—known as combination products—have therapeutic attributes "that are physically, chemically, or otherwise combined or mixed and produced as a single entity." 21 C.F.R. § 3.2(e). When reviewing a combination product, the FDA first determines the product's "primary mode of action," which refers to the one means by which the product achieves its intended therapeutic effect that makes the greatest contribution to the product's overall therapeutic effect. See 21 U.S.C. § 353(g)(1) (regulation of combination products); 21 C.F.R. § 3.2(k) (defining "mode of action"), § 3.2(m) (defining "primary mode of action"). A combination product can have one of three primary modes of action—drug, device, or biological product—and the FDA reviews a combination product in accordance with the product's primary mode of action. See 21 U.S.C. § 353(g)(1). For example, a combination product with the primary mode of action of a device is reviewed by the FDA as if the product were a device, whereas a combination product with the primary mode of action of a drug is reviewed by the FDA as if the product were a drug. See id.

FDA review of a new drug or medical device is often a lengthy process, not uncommonly requiring years to complete. The time-consuming nature of this process can impose certain significant costs on the holders of patents claiming new drugs or medical devices. Specifically, federal law generally provides a twenty-year term for a patent, starting from the date on which the patent application is filed. See 35 U.S.C. § 154(a)(2). This general rule places patents claiming FDA-regulated drugs or medical devices (or methods of using or manufacturing such drugs or medical devices) at a disadvantage, as many years of the patent's term can pass while the product awaits FDA approval. Because the patent owner cannot market the claimed product commercially without FDA approval, several years of the patent monopoly can be entirely unprofitable. See, e.g., Glaxo Operations UK Ltd. v. Quigg , 706 F.Supp. 1224, 1225 (E.D.Va.1989) (observing that FDA review and approval "often require[s] years to complete, thereby diminishing the commercial rights provided by the patent"), aff'd , 894 F.2d 392 (Fed.Cir.1990). Thus, an important policy concern in this area is that inventors may well not have sufficient incentive to expend the resources necessary to develop new drugs and medical devices, as patents claiming medical innovations subject to FDA review may have an effective life of less than the standard twenty years owing to the time consumed by the FDA review and approval process.

Title II of the Hatch-Waxman Act represents Congress's solution to this problem by seeking to ease the tension between ensuring safe drugs and medical devices on the one hand and incentivizing the development of new drugs and medical devices on the other. The mechanism for doing so involves extending the terms of certain patents claiming products (or methods of using or manufacturing products) subject to FDA review and approval. See Glaxo Operations UK Ltd. v. Quigg , 894 F.2d 392, 396 (Fed. Cir.1990) (The Hatch-Waxman Act "encourage[s] new drug research by restoring some of the patent term lost while drug products undergo testing and await FDA pre-market approval."). Thus, once the FDA's regulatory review of a product has concluded, the owner of a patent "which claims [the] product, a method of using [the] product, or a method of manufacturing [the] product" can apply to the PTO for an extension of the patent's term pursuant to the Hatch-Waxman Act. See 35 U.S.C. § 156(a). If the product and the patent meet certain statutory criteria, the PTO "shall" extend the term of the patent. Id. In other words, term extensions are mandatory for patents that qualify under § 156.

The PTO's final decision on a patent term extension application is an "agency action" subject to judicial review under the APA. As such, the PTO's final decision on whether to grant or to deny a patent term extension application may be "set aside" if it is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A).

B.5

The '447 patent —titled "Therapeutic Inhibitor of Vascular Smooth Muscle Cells"—issued on September 22, 1998. See U.S. Patent No. 5,811,447, at [45], [54] (filed May 25, 1995). As relevant here, claim 12 of the '447 patent recites "[a] method for biologically stenting

a mammalian blood vessel, which method comprises administering to the blood vessel of a mammal a cytoskeletal inhibitor in an amount and for a period of time effective to inhibit the contraction or migration of the vascular smooth muscle cells." Id. col. 76, ll. 41-46.

In addition to being the exclusive licensee of the '447 patent, plaintiff also manufactures the Zilver PTX, which performs both physical and biological stenting

of blood vessels. Specifically, the Zilver PTX is a self-expanding nitinol 6 stent coated with the drug paclitaxel ; the physical aspect of the stent imparts outward force on the vascular wall and supports the paclitaxel coating, maintaining the drug in direct contact with the vascular wall. This physical support allows the administration of the paclitaxel, which inhibits the contraction or migration of smooth muscle cells in the vascular wall and prevents restenosis

, the narrowing of arteries over time.

In June 2010, plaintiff applied for FDA approval to market the Zilver PTX commercially. The Zilver PTX is a combination product in that it comprises device and drug components, and the FDA determined that its primary mode of action is that of a device. Accordingly, the FDA agency center charged with premarket review of devices had primary jurisdiction to review the Zilver PTX. See 21 U.S.C. § 353(g)(1)(B). The FDA granted the premarket approval application for the Zilver PTX on November 14, 2012.

On December 7, 2012, shortly after FDA approval of the Zilver PTX, plaintiff filed with the PTO an application for a patent term extension for the '447 patent.7 This application sought a five-year term extension, the maximum amount allowed by statute,8 on the basis that the '447 patent claims a method of using the Zilver PTX. Thereafter, in March 2015, the PTO issued plaintiff a Requirement for Information directing plaintiff to provide additional information necessary to the PTO's determination of the '447 patent's eligibility for a patent term extension.9 Specifically, the PTO sought to discover from plaintiff how the '447 patent"claims ... a method of using" the Zilver PTX consistent with the Hatch-Waxman Act. 35 U.S.C. § 156(a). In June 2015, plaintiff responded to the PTO's request by identifying claim 12 of the '447 patent as claiming a method of using the Zilver PTX. As noted, claim 12 recites "[a] method for biologically stenting

a mammalian blood vessel, which method comprises administering to the blood vessel of a mammal a cytoskeletal inhibitor in an amount and for a period of time effective to inhibit the contraction or migration of the vascular smooth muscle cells." Col. 76, ll. 41-46.

In October 2015, the PTO issued an initial decision denying plaintiff's application for a patent term extension. Thereafter, plaintiff unsuccessfully sought reconsideration of the initial decision, and the PTO issued its final decision denying plaintiff's application on December 11, 2015. The PTO's final decision explained that the Zilver PTX was reviewed and approved by the FDA as a medical device, and hence, in the PTO's view, in order for a...

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