Supreme Court Unanimously Rules for Generic Manufacturers in Improper Patent Listing Case

By Charles Pierce

In Caraco Pharmaceutical Laboratories, Ltd. v. Novo Nordisk A/S, 566 U.S. ___ (2012), the Supreme Court unanimously clarified the prerequisites of 21 U.S.C. §355(j)(5)(C)(ii)(I) counterclaims seeking to correct or delete patent information that a name-brand pharmaceuticals manufacturer submits to the FDA.

Repaglinide is a drug that has been approved by the FDA for the treatment of diabetes.  The FDA approved three methods: repaglinide alone, repaglinide in combination with metformin, and repaglinide in combination with thiazolidinediones.  The compound was covered by the ‘035 patent that Novo had owned, but the patent had expired in 2009.  Novo currently owns the ‘358 patent, a method-of-use patent which claims “a method for treating [diabetes by] administering . . . repaglinide in combination with metformin.”

Generic drug makers, rather than submit a new drug application (NDA), may submit an abbreviated new drug application (ANDA) that piggy back on the brand’s NDA.  Following the expiration of the ‘035 patent, Caraco filed such an ANDA seeking permission to market a generic version of repaglinide alone and repaglinide in combination with thiazolidinediones for the treatment of diabetes.  Before the FDA granted approval, Novo changed its use code for the ‘358 patent to cover all methods of using repaglinidine.  Caraco then filed a certification stating that the ‘358 patent would not be infringed, and Novo treated this as an act of infringement and sued.  Caraco filed a counterclaim under § 355.

21 U.S.C. §355(j)(5)(C)(ii)(I) states that when sued for infringement, an ANDA applicant may:

“Assert a counterclaim seeking an order requiring the [brand] to correct or delete the patent information submitted by the [brand] under subsection (b) or (c) [of §355] on the ground that the patent does not claim either –

(aa) the drug for which the [brand’s NDA] was approved; or

(bb) an approved method of using the drug.”

The parties disagreed on the meaning of the phrase “on the ground that the patent does not claim . . .  an approved method of using the drug.”  Novo argued that this should mean that the only time a counterclaim is allowed is when the patent does not claim any approved method of using the drug.  Caraco argued that instead, a counterclaim was allowed when the ANDA applicant applies for a method of using the drug not covered by the patent.  The Supreme Court agreed with Caraco.

The Supreme Court first examined the statutory context and noted that the statute contemplates that a single patented use should not prevent an ANDA from being approved.  By Novo’s reading, a patent claiming a single method of use would be sufficient to deny both FDA approval and a cause of action to ANDA applicants seeking to market the drug for unrelated uses.  Finding this result to be contrary to the statutory intention, the Court ruled for Caraco’s interpretation.

Novo also argued that Caraco’s counterclaim should fail because use codes are not patent information submitted under subsections (b) or (c) for the purposes of the statute.  The Supreme Court again disagreed with Novo.  First, the Court ruled that a use code does qualify as patent information because it describes the method of use claimed in a patent.  Use codes are required under 21 CFR §314.53 and when issuing §314.53, the FDA noted that its authority stemmed from 21 U.S.C. §355.  Because of this, the Court then decided that subsections (b) or (c), which require an NDA applicant to submit the patent number and expiration date of any patent claiming the drug or its method of use, cover use codes.  The Supreme Court also noted that if a counterclaim in such a case was not allowed, than the term “correct” in “assert a counterclaim seeking an order requiring the [brand] to correct or delete the patent information” would be read out of §355(j)(5)(C)(ii)(I).  Thus, the Court ruled that use codes are patent information submitted under subsections (b) or (c).

Finally, the Court rejected Novo’s legislative history arguments.  Novo first argued that Caraco’s interpretation of §355 would resurrect a scheme rejected by Congress.  A 2002 bill had sought to require brands to file patent information, and allow generic companies to bring actions to correct such information.  The bill failed, but the Supreme Court here declined to view the failure as a Congressional rejection of the requirement, noting that bills may be proposed and rejected for any number of reasons.

The Supreme Court then rejected Novo’s final argument – that the counterclaim was established only in response to the Federal Circuit’s decision in Mylan Pharmaceuticals, Inc. v. Thompson, 267 F. 3d 1323 (Fed. Cir. 2001).  In Mylan, the Federal Circuit had decided that no action to delist an improperly listed patent from the Orange Book was available.  The Court noted that even assuming that Congress was responding to Mylan, the situation presented in this case was similar to that in Mylan: an unrelated drug patent blocked FDA approval for a generic manufacturer.  The Supreme Court unanimously ruled for Caraco, deciding that a cause of action exists for generic manufacturers when the brand lists a method-of-use patent that does not cover a method of use for which the generic manufacturer seeks FDA approval.


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