Decision reversing Federal Circuit ruling determines that the FDA counterclaim provision can be applied to a patent use code, as a use code describes the method of use claimed in a patent and thus constitutes "patent information."
In a recent decision, Caraco Pharmaceutical Laboratories, Ltd. v. Novo Nordisk A/S, No. 2010-844 (Apr. 17, 2012), the U.S. Supreme Court held that generic drug manufacturers may use the counterclaim provision of 21 U.S.C. § 355(j) to seek correction of an alleged overbroad use code associated with a branded drug manufacturer's method-of-use patent.
Background
Patentee Novo Nordisk (Novo) obtained a product patent for a diabetes drug, repaglinide, which Novo markets under the brand name Prandin®, as well as a patent for the combination composition and use of Prandin® with another compound, metformin. Novo's first patent expired in 2009, but the second patent, U.S. Patent No. 6,677,358 (the '358 patent), does not expire until 2018. The U.S. Food and Drug Administration (FDA) has approved three ways of using Novo's drug: (1) use of repaglinide by itself; (2) use of repaglinide in combination with metformin; and (3) use of repaglinide in combination with another class of drugs, thiazolidinediones (TZDs).
Caraco Pharmaceutical Laboratories (Caraco) filed an abbreviated new drug application (ANDA) in 2005 seeking FDA approval to market repaglinide, and Novo initiated a patent infringement action. Following a directive from the FDA changing the indication for Prandin® from three separate indications to the unified indication "improving glycemic control in adults with type 2 diabetes mellitus," Novo amended its use code for the '358 patent to track the language of the required indication. This change in effect prevented Caraco from carving out the patented use and seeking approval for use of repaglinide alone. Accordingly, Caraco asserted a counterclaim seeking an injunction requiring Novo to correct its use code.
Counterclaim Applied to a Use Code?
21 U.S.C. § 355(j)(5)(C)(ii)(I) permits the generic manufacturer of a drug to file a counterclaim challenging the patent information that the branded drug manufacturer has submitted to the FDA. This counterclaim asks the court to order the brand-name manufacturer to correct or delete the patent information it submitted by the branded drug manufacturer under subsection (b) or (c) of 21 U.S.C. § 355 on the grounds that the patent does not claim either the drug for which the brand-name manufacturer's application was approved or an approved method of using the drug. The question in this case was whether such a counterclaim could be applied to a use code submitted by a branded drug manufacturer.
In September 2009, the district court determined that the counterclaim provision can be applied to a use code and issued an injunction requiring Novo to change its use code back to its former code. Novo appealed. In 2010, the Federal Circuit reversed the district court's decision and adopted Novo's argument that the phrase "on the ground that the patent does not claim . . . an approved method of using the drug" means that the counterclaim was available only if the listed patent did not claim any approved method of using the drug. The Federal Circuit further concluded that the "patent information" that may be deleted or corrected under the counterclaim provision was limited to the patent number and the expiration date and did not include the use code information. Caraco sought review by the Supreme Court, which granted certiorari in June 2011.
Supreme Court Decision
On April 17, 2012, the Supreme Court reversed the Federal Circuit's decision and held that the counterclaim is available to a generic manufacturer seeking to correct an alleged overbroad use code associated with a branded manufacturer's method-of-use patent. In particular, the Court decided that the statute "contemplates that one patented use will not foreclose marketing a generic drug for other unpatented ones" and that "[w]ithin that framework, the counterclaim naturally functions to challenge the brand's assertion of rights over whichever discrete use (or uses) the generic company wishes to pursue." Slip op. 13.
The Court also rejected Novo's argument that use codes are not "patent information submitted by the [branded drug manufacturer] under subsection (b) or (c)" of Section 355. Specifically, while the Court acknowledged that the statute refers to "'patent information submitted by the [brand] under subsection (b) or (c)' of § 355," it broadly construed "submitted . . . under" to mean "'in furtherance of or compliance with a comprehensive scheme of regulation.'" Id. at 15 and 17 (quoting Eli Lilly & Co. v. Medtronic, Inc., 496 U.S. 661, 667 (1990)) (emphasis added). Accordingly, the Court concluded that under federal regulations, a use code describes the method of use claimed in a patent and thus constitutes "patent information."
A copy of the opinion can be found at http://www.supremecourt.gov/opinions/11pdf/10-844.pdf.