In my last post, I discussed how generic manufacturers use the practice of “skinny labeling” to get a free ride on a branded drug’s unexpired method of use patent. As I explained, when a pioneer drug has multiple indications, each of which is protected by a separate method of use patent with its own expiration date, the generic drug manufacturer can avoid having to incur the considerable expense and risk in challenging the validitiy and enforceability of the unexpired method of use patent by submitting a “section viii” statement with its ANDA. By side-stepping a Paragraph IV certification under Hatch-Waxman, the generic manufacturer not only avoids the risk of an adverse ruling and losing millions of dollars in patent infringement litigation, but ends up selling its skinny-labeled drug for the patent-protected use anyway because of mandatory and permissive “substitution” rules that require/allow generic substitution of cheaper “AB” rated generic drugs for branded drugs. While a skinny label free ride is great for the generic drug industry, the innovator drug industry is caught in the horns of a skinny label dilemma: should it continue to invest and lose billions of dollars in clinical research getting FDA approval of current off-label uses (knowing that as soon as the patents on a drug’s compound and original indication(s) expire, the drug will get skinny labeled), or forego the investment and face the possibility of investigation and prosecution for off-label promotion of those uses?
A number of years ago, Warner-Lambert dealt with the problem by filing an infringment suit against Apotex following the latter’s ANDA for gabapentin. Apotex sought FDA approval to market gabapentin to treat partial seizures in adults with epilepsy, the approved indication for Neurontin®, upon expiration of that drug’s compound and method of use patents. However, much of Neurontin® was prescribed off-label to treat “neurodegenerative diseases”, for which Warner-Lambert had obtained a separate method of use patent. (By 1998, 78% of all Neurontin® sales were for neurodegenerative diseases). Although Apotex had filed a traditional Paragraph IV certification with respect to the neurodegenerative patent (instead of a section viii statement), Apotex maintained during the suit that it was not looking to market gabapentin for neurodegenerative diseases. Unpersuaded by Apotex’s assurances, Warner-Lambert’s suit alleged infringement under 35 U.S.C. § 271(e)(2) (claiming that the filing of Apotex’s ANDA constituted an act of infringment of the neurodegenerative method patent) and 35 U.S.C. § 271(b) (claiming that Apotex would necessarily induce infringement of the neurodegenerative patent, given the drug’s widely-known off-label uses). Affirming the district court’s summary judgment ruling in favor of Apotex, the Federal Circuit held that Hatch-Waxman protected only method of use patents for FDA-approved indications and that any contrary holding would allow a pioneer manufacturer to extend its monopoly “by regularly filing a new patent application claiming a narrow method of use not covered by the NDA.” Warner-Lambert v Apotex Corp.., 316 F. 3d 1348, 1359 (Fed. Cir. 2003).
In Warner-Lambert, Apotex didnt’ submit or rely upon a section viii statement for its assertion that it had no intent to “infringe” Warner-Lambert’s neurodegenerative disease patent. Several years later, however, Apotex did submit a section viii statement in connection with its ANDA to market a generic version of rosuvastatin calcium — more commonly known by its brand name, Crestor®, Astra-Zeneca’s flagship cholestorol drug. Although Apotex filed a Paragraph IV certification with its ANDA, challenging Crestor®‘s compound patent (scheduled to expire in 2016), it didn’t challenge the two method of use patents covering two FDA-approved cholesterol indications (scheduled to expire in 2018 and 2021). Instead, Apotex declared through its section viii statement that it would carve-out the patent protected indications from the label and only market its product for two FDA-approved uses that were not protected by method of use patents.
Realizing that Apotex’s skinny labeled version of Crestor® would be substituted for all of its uses, including the drug’s patent-protected uses, Astra-Zeneca (“AZ”) filed two infringement suits under § 271(e)(2). While the first suit was based on the Crestor® compound patent, the second suit alleged (among other things) that, given the “market realities” of generic substitution, a section viii approval of Apotex’s skinny labeled rosuvastatin calcium drug would infringe the method of use patents for the FDA-approved indications. Though upholding the validity and enforceability of the compound patent in the first suit, the district court dismissed the second suit on several grounds, including the failure to state a claim under § 271(e)(2). On appeal the Federal Circuit affirmed the dismissal, relying on Warner-Lambert and holding that at least one “use” in the generic manufacturer’s ANDA had to be covered by a patent in order for a pioneer manufacturer to get relief under § 271(e)(2). Although AZ correctly noted that Warner-Lambert was distinguishable because the neurodegenerative disease patent at issue was not FDA-approved, the Federal Circuit was unmoved: “First, Astra-Zeneca’s position would, in practice, vitiate [section viii] by enabling § 271(e)(2) infringement claims despite the fact that [Apotex's] Section viii statements and corresponding proposed labeling explicitly and undisputably carve out all patented indications for rosuvastatin calcium. Moreover, if accepted, these speculative arguments would allow a pioneer drug manufacturer to maintain de facto exclusivity over a pharamaceutical compound by obtaining serial patents for approved methods of using the compound and then wielding § 271(e)(2) as ‘as a sword against any competitor’s ANDA seeking approval to market an off-patent drug for an approved use not covered by the patent. Generic manufacturers would effectively be barred altogether from entering the market’.”Astra-Zeneca v Apotex Corp., 669 F.3d 1370, 1380 (Fed. Cir. 2012) (quoting Warner-Lambert, 316 F.3d at 1359).
So, do Warner-Lambert and Astra-Zeneca mean that pioneer manufacturers have no recourse against generic skinny labelers? It is certainly clear from these cases that pioneer manufacturers can’t stop a skinny labeled drug from entering the market under § 271(e)(2). And, while an inducment suit under § 271(b) is always possible, cf., Abraxis Bioscience, Inc. v. Navinta LLC, 640 F.Supp.2d 553 (D. N.J. 2009) (citing a litany of factors that may be considered in an inducement analysis), vacated on other grounds, 625 F.3d 1359 (Fed. Cir. 2010), the best long term solution for the pioneer industry is to work to reform the current Orange Book system so as to inform health care providers, pharmacists, payers and the public that certain brand indications have been carved out of generic labels. Such a system would not only put pharmacists and others on notice that certain uses are patent-protected, but that the skinny labeled drug is not safely and effectively labeled for such uses. Absent such a system (which is similar to what is being proposed for “biosimilars”), the pioneer industry may find it difficult to avoid getting “gored” on the horns of the skinny label dilemma.