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FDA research safe harbor does not extend to devices not subject to FDA approval

August 07, 2008
Post by Blog Staff

In a decision Tuesday, the Federal Circuit affirmed a district court's holding of patent infringement on the basis that the "safe harbor" provision of the Hatch-Waxman Act, § 271(e)(1), did not insulate the accused activity from infringement and that the district court did not err in granting a judgment as a matter of law in favor the plaintiff on infringement and the defendant's invalidity defenses.The Federal Circuit stated that the safe harbor provision of the Hatch-Waxman Act was enacted by Congress to eliminate two unintended distortions of the effective patent term resulting from the premarket approval required of certain products pursuant to the Food, Drug, and Cosmetic Act. The first was to extend the patent term of patents covering products subject to regulatory delays caused by the FDA approval process. The second was to insulate from infringement liability actions for purposes that are solely "reasonably related" to an FDA submission. Here, the infringing device was not itself subject to FDA approval, but was used to perform tests that facilitate FDA approval for other devices. The court held that the "safe harbor" provision applied only to products which themselves are subject to FDA premarket approval, and thus faced the unintended distortions to of an effective patent term. As a result, the court affirmed the district court's holding that the safe harbor of § 271(e)(1) did not apply.More detail of Proveris Sci. Corp. v. Innovasystems, Inc. after the jump.

The plaintiff, Proveris Scientific, owns a patent directed towards a system and apparatus for characterizing aerosol sprays used in drug delivery devices such as nasal spray pumps and inhalers. Such a system is depicted in the figure below:FigureSpray characterization plays a role in the regulatory approval process of the FDA under the Federal Food, Drug, and Cosmetic Act. The system and apparatus claimed in the patent are not themselves subject to FDA approval, but are used during the approval process for aerosol drug delivery devices. The defendant, Innovasystems ("Innova"), makes and sells an aerosol spray characterization device called the Optical Spray Analyzer ("OSA"). In December 2005, Proveris filed suit against Innova alleging infringement of the patent. Innova argued that the safe harbor provision of the Hatch-Waxman Act, § 271(e)(1), immunized any alleged infringement because its OSA devices are used solely for the development and submission of information to the FDA. The relevant statutory language reads as follows:

It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention . . . solely for uses reasonably related to the development and submission of information under a Federal Law which regulates the manufacture, use, or sale of drugs or veterinary biological products.

The district court ruled as a matter of law that § 271(e)(1) does not immunize Innova's OSA devices from infringement of the patent. The district court also granted a judgment as a matter of law in favor of Proveris with respect to infringement claims 3-10 and 13 because Innova's counsel conceded infringement of those claims, and further purportedly agreed with, or failed to object to, statements that those claims were admittedly infringed. The district court further excluded expert testimony from Innova necessary to support its invalidity defenses, and on this basis granted judgment as a matter of law in favor of Proveris on those defenses. The jury found claims 1 and 2 of the patent not infringed, and awarded no damages for infringement of claims 3-10 and 13. The district court entered final judgment and issued a permanent injunction barring Innova from infringement of the patent. Innova appealed.The main issue on appeal was the applicability of the § 271(e)(1) safe harbor. The Federal Circuit held that the safe harbor did not apply to the OSA devices.The court first examined the reasons the Hatch-Waxman Act was enacted. Specifically, the court noted before the Hatch-Waxman Act, there were two unintended distortions of the effective patent term resulting from the premarket approval required for certain products by the FDCA. The first was the reduction of effective patent life caused by FDA premarket approval of a patented product, which delayed the product's release into the market. This is addressed by § 156(f), which extends patent term to compensate for delays in the approval process. The second was the de facto extension of effective patent life at the end of the patent term resulting from the FDA premarket approval requirements, which could not begin until the patent expired and other parties were free to make or use the invention for purposes of preparing their own FDA submissions. This delayed the introduction of other products covered by the expired patent until the premarket approval requirements were completed. This is addressed by § 271(e)(1), which permits companies to avoid infringement for use of patented technology in connection with preparation of an FDA submission.In Eli Lilly & Co. v. Medtronic, Inc., the Supreme Court held that medical devices were covered by the Hatch-Waxman act, and essentially interpreted § 271(e)(1) to include at least all inventions within the scope of the § 156(f) patent term extension. More recently, in Merck KGaA v. Integra Lifesciences I, Ltd., the Court held that § 271(e)(1)'s safe harbor insulates preclinical research activities, even if the results are never actually submitted to the FDA, so long as the party has a reasonable basis to believe the tested compound will work.Having set the stage, the Federal Circuit noted the issue was "whether section 271(e)(1) immunizes the manufacture, marketing, or sale of Innova's OSA, which is used in the development of FDA regulatory submissions, but is not itself subject to the FDA premarket approval process." The court held the safe harbor did not apply, and that § 271(e)(1) only applied to devices which required premarket approval and therefore were subject to the two unintended distortions of the effective patent term. Because the OSA device did not require premarket approval (and therefore was not eligible for the extensions of § 156(f)), its use, even in the context of gathering data for an FDA submission for another product, did not qualify for protection under § 271(e)(1). Regarding the judgment as matter of law that claims 3-10 and 13 were infringed, the Federal Circuit determined that, based on the record, the only reasonable conclusion was that Innova conceded infringement because they repeatedly failed to object to statements made by the district court stating that Innova conceded infringement. The court also affirmed the exclusion and limitation of Innova's expert testimony on invalidity. One of Innova's witnesses was excluded because he did not submit a written expert report in compliance with Rule 26(a)(2)(b), and the other was limited in testimony to spray plumes in general and patent prosecution and not allowed to testify regarding laboratory equipment used in development of drug delivery devices. The Federal Circuit determined that the district court did not abuse its discretion in determining that the subject matter of the patent was sufficiently complex to fall beyond the grasp of an ordinary layperson, and thus expert testimony was required to support the invalidity defenses. Further, the court held it was not an abuse of discretion to determine a witness with a background in spray plumes could not testify as to the specifics of the development of drug delivery devices.As a result, the Federal Circuit affirmed the district court's conclusions in all respects.To read the full decision in Proveris Sci. Corp. v. Innovasystems, Inc., click

  • Federal Circuit cases
  • Literal infringement

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