WASHINGTON--(BUSINESS WIRE)--Starting at 10 am, the US Court of Appeals for the Federal Circuit in Washington, D.C., -- sitting in a rare en banc session in which all 12 judges participate -- will hear arguments in a case that will have a major impact on patents, especially in the rapidly emerging biopharmaceutical industry.
The question before the Court – which has national jurisdiction over all patent-case appeals – is whether an inventor’s use of a third-party manufacturing service can invalidate the patentability of the invention, in this case an innovative heart medication.
The heart of the issue is whether patentees who, through necessity or choice, use third-party contract manufacturing services to develop or manufacture a product, should be treated differently from companies that can perform the same tasks in-house.
The outcome of the case, The Medicines Company vs Hospira, is of particular concern to individual applicants and companies that use third-party contractors – a common practice in the biopharmaceutical industry – since an adverse ruling would make it virtually impossible to patent the products they invent.
The Medicines Company lost its patent for Angiomax, a widely-used injectable anti-coagulant drug employed during most heart surgeries, which now accounts for the bulk of the firm’s sales.
Under US patent law, a patent can be rendered invalid if the invention was on sale more than one year before the date of the patent application. Commonly referred to as the “on-sale bar,” the provision is intended to prevent inventors from extending a monopoly by selling their product for more than a year and then patenting it to gain an additional period of market exclusivity.
The en banc rehearing stems from a three-judge panel’s decision that a patentee’s use of a third-party manufacturer was equivalent to the sale of the invention from the manufacturer back to the inventor.
That decision was vacated by the en banc Court, which has asked the parties to specifically address: (i) whether there was a sale despite the absence of a transfer of title; (ii) whether the alleged sale was commercial in nature or an experimental use; and (iii) should the Federal Circuit overrule or revise the principle that there is no “supplier exception” to the on-sale bar? Third party contractors are currently used by the large majority of pharmaceutical firms.
If the Federal Circuit determines that third-party manufacturing services do trigger the on-sale bar, it could have far-reaching consequences for companies that use third-party manufacturers. As noted in an amicus brief filed by the Biotechnology Innovation Organization, “even the very largest companies in the biopharmaceutical industry rarely maintain their own internal resources to conduct all manufacturing . . . because even for large companies it often is more efficient to use [contract manufacturing organizations] to perform these services.”
A number of other important amicus brief filers also argue in favor of overturning the three-judge panel’s decision, including the US Department of Justice, the American Intellectual Property Law Association, the Intellectual Property Owners Association and the Pharmaceutical Research and Manufacturers of America.
Arguing the case for overturning the ruling on behalf of The Medicines Company will be Edgar H. Haug, a founding partner of the New York law firm of Frommer Lawrence & Haug. Mr. Haug is a nationally recognized trial lawyer specializing in intellectual property and competition law in complex technical fields including pharmaceuticals and biotechnology.
The en banc hearing will be held Thursday, May 05, 2016, beginning at 10 am in Courtroom 201 of the U.S. Court of Appeals for the Federal Circuit, 717 Madison Place, NW, Washington, DC 20005. The hearing is open to the media and public.
The drug in question is Angiomax which is an injectable anti-coagulant for patients undergoing heart surgery.