United States: Novartis v. Ezra And Novartis v. Breckenridge: Cracks In The Armor Of ODP Portending Well For Innovative Pharma?


The Federal Circuit issued decisions in Novartis AG v. Ezra Ventures LLC, -- F.3d __, 2018 WL 6423564 (CHEN, Moore, Stoll) and Novartis Pharmaceuticals Corp. v. Breckenridge Pharmaceutical, -- F.3d __, 2018 WL 6423451 (CHEN, Prost, Wallach) on Dec. 7, 2018. Both cases address obvious-type double patenting ("ODP") issues that arise out of timings relative to the Uruguay Round Agreements Act of 1994 (hereafter "GATT").1 And, as we shall see, both decisions are in favor of the patent owner, Novartis.


In Gilead Sciences, Inc. v. Natco Pharma Ltd., 753 F.3d 1208 (Fed. Cir. 2014), the Federal Circuit held that a later-issued but earlier-expiring patent could qualify as a double patenting reference against an earlier-issued but later-expiring patent if the claims of the two patents are not patentably distinct. The court focused on expiration dates and the policy objective that at the expiration of a patent, the public has a right to use the invention claimed. The Court in Gilead explained that the expiration date "guarantees a stable benchmark that preserves the public's right to use the invention ... when that patent expires."2


In Novartis v. Ezra, the Federal Circuit addressed whether a second-filed, second-issued patent can be asserted as an ODP reference against a first-filed, first-issued patent where the statutorily defined patent terms are different due to pre-URAA and post-URAA status and a patent term extension.

Timelines from the decision:

Novartis' patent, U.S. 5,604,229, was filed before the June 8, 1995, effective date of the URAA (pre-GATT in this article, whereas any patent filed on or after the effective date of URAA, including U.S Patent 6,004,565, is referred to as GATT in this article). As such, the '229 pre-GATT patent had a patent term of 17-years from issue, and the original expiration date was Feb. 18, 2014. Novartis was awarded a patent term extension (PTE) of 5 years under 35 U.S.C. §156 to extend the expiration date of the '229 patent, at least for certain claims, to Feb. 18, 2019. The '229 pre-GATT patent claimed compounds, including fingolimod, a component of the Gilenya® drug commercially marketed in the U.S.

Novartis sued Ezra for infringement of the '229 patent after Ezra filed an ANDA to market a generic version of Gilenya®. Novartis also held a GATT patent related to Gilenya®, U.S. 6,004,565, claiming a method of administering fingolimod. The '565 GATT patent issued from an application filed after the effective date of the URAA, so its patent term was 20-years from filing. The '565 GATT patent expired on Sept. 23, 2017, after the original expiration of the '229 pre-GATT patent but before the PTE of the '229 pre-GATT patent is to expire on February 18, 2019.

Ezra argued that the '229 pre-GATT patent should at least be terminally disclaimed past the expiration date of the '565 patent. That would have resulted in a loss of PTE for the '229 pre-GATT patent.

Novartis relied on footnote 6 from the Gilead case to support their arguments that there was no need to disclaim the '229 pre-GATT patent back to the September 23, 2017, expiration date of the '565 GATT patent. Footnote 6 said that there are exceptions to the pre-GATT rule that later-issued patents expired later, such as in the case of a patent that qualifies for term extension. Gilead v. Natco, 753 F.3d at 1215, n6. And since the patent term extension was obtained by adherence to the relevant law and procedures, the extension beyond September 23, 2017 was, according to Novartis, a justified extension. Ezra argued that in Novartis should not be allowed to extend the '229 pre-GATT patent's claims beyond the expiration of the '565 GATT patent's method claims because that effectively extended the '565 GATT patent in contravention of 35 U.S.C. §156, which limits PTE to one patent.

Agreeing with Novartis, Judge Stark in the District Court of Delaware relied on the Federal Circuit's analysis of the legislative history for 35 U.S.C. § 156 to decide that Congress left the choice of which single patent term to extend in the hands of the patent owner. Merck & Co. v. Hi-Tech Pharma. Co., 482 F.3d 13717, 1323 (Fed. Cir. 2007). Judge Stark accepted as a given that this flexibility legally allowed for the "de facto" extension of the second issued '565 GATT patent due to patent term extension of the first to issue, i.e., the '229 pre-GATT patent. Judge Stark entered a judgment finding the '229 pre-GATT patent valid, unexpired, enforceable, and infringed.

As we predicted in our article of July 26, 2018, after the oral argument, the Federal Circuit held in favor of Novartis. And also, in doing so, the Ezra Federal Circuit upheld Judge Stark's decision to honor a patent owner's choice of which patent term to extend:

[N]othing in the statute restricts the patent owner's choice for patent term extension among those patents whose terms have been partially consumed by the regulatory review process. Importantly, Congress did not, through §156, compensate a loss of term for all patents affected by regulatory review. In striking a balance between the competing interests of new drug developers and low-cost generic competitors, Congress limited a PTE grant for such a patent owner to only one of its patents

Id. at *4.

Any "effective" extension of the '565 GATT patent is a "permissible consequence of the legal status conferred upon the '229 pre-GATT patent by § 156." Id. The Federal Circuit quoted its decision in Merck v. Hi-Tech:

Congress chose not to limit the availability of a patent term extension to a specific patent and instead chose "a flexible approach which gave the patentee the choice." 482 F.3d at 1323. As long as the requirements for a patent term extension recited in § 156(a) are met, the Director of the Patent and Trademark Office "shall" grant a PTE on the patent of patentee's choice. See 35 U.S.C. § 156(e)(1).


Furthermore, "as a logical extension" of Merck, ODP "does not invalidate a validly obtained PTE[:]" "[I]f a patent, under its pre-PTE expiration date, is valid under all other provisions of law, then it is entitled to the full term of its PTE." Id. at *5.

Significantly, the Federal Circuit in Ezra also noted that "agreeing with Ezra would mean that a judge-made doctrine [ODP] would cut off a statutorily-authorized time extension." Id. at *6. It "decline[d] to do so." Id.


In Novartis Pharmaceuticals Corp. v. Breckenridge Pharmaceutical, Judge Andrews in the District of Delaware, held that a later-filed, earlier-expiring, GATT patent could serve as an ODP reference to invalidate a first-filed, later-expiring pre-GATT patent and thus deny that pre-GATT patent from enjoying a full seventeen-year term from issuance.

Novartis' patent, 5,665,772 was filed pre-GATT, and expired 17 years from issuance, on September 9, 2014, as shown below in the timeline. Due to a five-year PTE, the '772 pre-GATT patent's term expires, for at least certain claims, on September 9, 2019. The asserted invalidating reference, Novartis's GATT patent, U.S.6,440,990, was filed after, and issued after the '772 pre-GATT patent, but expired before the '772 pre-GATT patent. Both patents claimed the same priority date. Because of GATT, the lifespan of the '772 pre-GATT patent encompasses and extends beyond that of the '990 GATT patent, even without considering the PTE.

Judge Andrews, relying on Gilead v. Natco, supra, found that the '990 patent was a proper double patenting reference for invalidating the '772 patent (see schematic below from Federal Circuit decision).

At the Federal Circuit oral argument, the Judges asked "Isn't this Gilead?" Novartis pointed to footnote 6 of Gilead where the Court said the public's right to practice the expired patent may be further limited by some other means established by Congress, such as a patent term extension. Novartis also emphasized the idea that this would not be an unjust extension, pointing out that PTE is authorized by statute.

As predicted in our July 2018 article, supra, the Federal Circuit reversed the district court decision:

[O]ur opinion [in Gilead] was limited to the context of when both patents in question are post-URAA patents. ... Here we have one pre-URAA patent (the '772 patent) and one post-URAA patent (the '990 patent), governed by different patent term statutory regimes. Our decision in Gilead thus does not control the present situation. Instead, the correct framework here is to apply the traditional obviousness-type double patenting practices extant in the pre-URAA era to the pre-URAA '772 patent and look to the '772 patent's issuance date as the reference point for obviousness-type double patenting. Under this framework, and because a change in patent term law should not truncate the term statutorily assigned to the pre-URAA '772 patent, we hold that the '990 patent is not a proper double patenting reference for the '772 patent. Accordingly, we reverse.

Id. at *2.3

According to the Federal Circuit, its Gilead reasoning was "rooted in the consequences that flow from the implementation of the URAA's new patent term rule under which a patent expires 20 years from the effective filing date[.]" Id. at 6. In this [Breckenridge] case, the order of expiration of the patents is by operation of statute; there was no "patent prosecution gamesmanship." Id.

The Federal Circuit also distinguished its decision in AbbVie, Inc. v. Mathilda & Terence Kennedy Institute of Rheumatology Trust, 764 F.3d 1366 (Fed. Cir. 2014), which, like Gilead, involved two post-URAA patents and where the earlier-filed patent had an earlier issuance date and earlier expiration date. In Breckenridge, as shown in the schematic above, there was, in contrast, one pre-GATT patent and one GATT patent. And the earlier filed pre-GATT patent had an earlier issuance date but, in contrast, a later expiration date.

Using the pre-URAA ODP framework, the '772 patent issued before the '990 patent. Therefore, the '990 could not exist as a double patenting reference against the '772 patent.

The Federal Circuit concluded:

The fact that the law for the term of a patent changed, resulting in the later-issued '990 patent having an earlier expiration date than it would have pre-URAA, should not affect the '772 patent's statutorily-granted 17-year patent term. Rather than Novartis receiving a windfall with a 17-year term for its '772 patent, its '990 patent's term was truncated by the intervening change in law. To find that obviousness-type double patenting applies here because a post-URAA patent expires earlier would abrogate Novartis's right to enjoy one full patent term on its invention.

Id. at *8.4


The Federal Circuit decisions, Ezra and Breckenridge, both authored by Judge Chen and issued on the same day, came out strongly in support of honoring the patent term awarded by statute to the patent owner. The decisions clarified that Gilead's and AbbVie's focus on expiration dates in the ODP analysis are restricted to situations involving patents filed post-GATT. We shall see if a future Federal Circuit, perhaps en banc, ultimately abrogates the ODP rulings in Gilead and AbbVie.


1 The Uruguay Round Agreements Act (URAA) of 1994 was enacted as part of a larger multilateral treaty called the General Agreement on Tariffs and Trade (GATT). The URAA changed the U.S. patent term to 20 years from the earliest effective non-provisional filing date. Before the URAA, the U.S. patent term was 17 years from issuance. When the URAA was enacted, there was provision for a transition period when patent owners could choose the longer of 17 years from issuance or 20 years from filing. See Uruguay Round Agreement Act, Pub. L. No. 103–465, 108 Stat. 4809, 4983 (1994), amending 35 U.S.C. § 154.

2 Gilead, 753 F.3d at 1216. That policy, of course, has limits not before the Court in Gilead. First, any patents issuing from divisional applications filed in response to a restriction requirement are protected from a finding of ODP under a safe harbor if consonance of the restriction requirement is maintained. 35 U.S.C. §121. Also, it has long been known in the U.S. patent system that a second-expiring patent that is patentably distinct from a first-expiring patent does not improperly extend the term of the first expiring patent, irrespective of whether pre-GATT or GATT applies. See e.g., UCB, Inc. v. Accord Healthcare, Inc., 890 F.3d 1313 (Fed. Cir. 2018), where the claims to a later-expiring species were held patentably distinct from an earlier-expiring genus.

3 Note that, as shown in the schematic above, the '990 GATT patent issued AFTER the '772 patent.

4 Note, Novartis' patent also survived an IPR challenge by Breckenridge, IPR2016-00084, Paper 73 (P.T.A.B. Jan. 11, 2018).

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