GSK v Teva – The Federal Circuit's First Look at Skinny Labels and 35 U.S.C. 271(b)

December 7, 2020 – Article

In GSK v Teva the Federal Circuit reversed the district court’s JMOL and reinstated the jury’s verdict awarding $235 million in damages to GSK for Teva’s sale of $75 million dollars of carvedilol the generic equivalent of GSK’s Coreg®, even though the patents on the drug and all but one of its uses had expired.

Brief statement of facts

Coreg® was approved for marketing in Food & Drug Administration (FDA) 1997 to treat hypertension. Coreg® was protected by three patents, U.S.P. 4,503,067 (‘067) which expired on March 2, 2007, U.S.P. 5,760,060 (‘069) and U.S.P. 5,902,821 (‘821) which expired later. When Teva filed Abbreviated New Drug Application (ANDA) GSK’s label identified three indications, treating hypertension protected by the ‘067 patent, congestive heart failure (CHF) protected by the ‘069 and ‘821 patents and left ventricular dysfunction following a myocardial infarction not patented. Teva certified under 21 U.S.C. § 355(j)(2)(A)(iii) (paragraph III) that it was not requesting approval before the expiration of the ‘067 patent and provided a § 355(j)(2)(A)(iii) (paragraph IV) certification that both the ‘069 and ‘821 patents were either invalid, not infringed or unenforceable. GSK did not initiate litigation under 35 U.S.C. 271(e)(2) on either the ‘069 or ‘821patents but instead sought reissue of the ‘069 patent. Subsequently Teva modified its ANDA application to remove CHF from its label creating a skinny label, § 355(j)(2)(A)(viii).

In 2008 Re. 40,000(‘000) issued from the reissue of ‘069. GSK promptly listed ‘000 in the orange Book and withdrew the ‘069 and ‘281 patents from the Orange Book. The FDA in 2011 realizing that the ‘069 and ‘281 patents had been withdrawn from the Orange Book required Teva to amend its label to include the CHF indication. The FDA ‘s position was in the absence of an Orange Book claiming the omitted indication a skinny label was inappropriate because the FDA rules required that a generic label be a duplicate of the brand’s label. Teva submitted to the FDA a new label including the patented CHF indication. Apparently Teva’s regulatory group apparently did not realize that ‘000 claimed the CGF indication and that the skinny label was proper. Thus, from its launch until May 2011 (skinny label period) Teva’s carvedilol label did not mention CGF but from May 2011 until June 7, 2015 when ‘000 expired, it did. The Federal Circuit found that Teva induced infringement not only for the period May 2011 to June 2015 but also for the skinny label period when its drug was not labeled for CHF. It is this period which is of interest.

Discussion

The majority and dissenting opinions will not win awards for legal scholarship, and 35 U.S.C. § 271(e)(1) similarly will win no awards for drafting statutes which carry out Congress’s intent. The legislative history is clear, 35 U.S.C. § 271(e)(1) – (4) was intended to permit the approval and marketing of generic drugs immediately upon the expiration of patent protection. The statute allowed a generic company to carve out of its label patent indications (uses) for a drug provided the generic label at least one approved use, aka “skinny label.” The courts have correctly interpreted 35 U.S.C. 271(e)(1) to be an exception to 35 U.S.C. § 271(a) and (b) for activities before the ANDA is approved by the FDA.  Neither opinion acknowledged this was a case of first impression. The prior skinny label cases involved ANDA litigation, 35 U.S.C. § 271(e)(2), none involved § 271(b) infringement. In ANDA litigation the infringement is theoretical since no actual infringement has occurred. Neither opinion reflects this reality and cite § 271(e)(2) cases to support their respective positions regarding § 271(b) induced infringement during the skinny label period.

The majority cites to Eli Lilly & Co. v. Teva Parenteral Meds., Inc., 845 F.3d 1357, 1369 (Fed. Cir. 2017) ("[E]vidence that the product labeling that Defendants seek would inevitably lead some physicians to infringe establishes the requisite intent for inducement."); Sanofi v. Watson Labs. Inc., 875 F.3d 636, 645 (Fed. Cir. 2017) (finding induced infringement where the label "directs medical providers to information identifying the desired benefit for only patients with the patent-claimed risk factors" and "[t]here was considerable testimony that this label encourages . . . administration of the drug to those patients"); AstraZeneca LP v. Apotex, Inc., 633 F.3d 1042, 1060 (Fed. Cir. 2010) (finding induced infringement where "despite being aware of the infringement problem presented by the proposed label, Apotex nonetheless proceeded with its plans to distribute its generic drug product"); but these case were § 271(e)(2), none related to § 271(b).

In her dissent Judge Prost cites Caraco Pharm. Labs., Ltd. v. Novo Nordisk, 566 U.S. 399, 405 (2012) for the concept that Wax- Hatchman act was to speed the entry of generics. She ignores the observation on page 406 that:

The FDA may approve such a modified label, see §314.127(a)(7), as an exception to the usual rule that a generic drug must bear the same label as the brand-name product, see 21 U. S. C. §§355(j)(2)(A)(v), (j)(4)(G). FDA acceptance of the carve- out label allows the generic company to place its drug on the market (assuming the ANDA meets other requirements), but only for a subset of approved uses—i.e., those not covered by the brand’s patents.

Note that the Court did not hold that once the product was marketed it was free from a claim of induced infringement. The purpose was to allow the FDA to approve the drug by providing an exception to a general FDA rule. The Federal Circuit in Warner-Lambert Co. v. Apotex Corp., 316 F.3d 1348, 1365, 65 USPQ2d 1481 (Fed. Cir. 2003) had stated:

The statute explicitly defines the act of infringement as the filing of the ANDA. The infringement case is therefore limited to an analysis of whether what the generic drug maker is requesting authorization for in the ANDA would be an act of infringement if performed. Here, the request to make and sell a drug labeled with a permissible (noninfringing) use cannot reasonably be interpreted as an act of infringement (induced or otherwise) with respect to a patent on an unapproved use, as the ANDA does not induce anyone to perform the unapproved acts required to infringe. That a generic maker may someday induce someone to infringe can only be determined when that act occurs, and § 271(e)(2) was not designed to cover such future acts. [Emphasis added]

Neither the majority not dissenting opinions address this last point.  In deciding Teva’s recently filed Request for Hearing En Blanc the Court needs to focus on Teva’s post approval activities applying conventional § 271(b) case law.  Once Teva’s ANDA was approved in 2007, it placed an entry in its online catalog advising that it was offering generic carvedilol for sale and that it was rated AB rated equivalents of the Coreg® tablets and a press release:

[the FDA] "has granted final approval for the company's Abbreviated New Drug Application (ANDA) to market its generic version of GlaxoSmithKline's cardiovascular agent Coreg® (Carvedilol) Tablets.".      

The FDA announced the approval of generic carvedilol with a press release:

"the first generic versions of Coreg® (carvedilol)." J.A. 7116. All fourteen AB-rated generics were approved based on skinny labels indicated only for hypertension and post-MI LVD. The FDA's release stated that "Coreg is a widely used medication that is FDA-approved to treat high blood pressure, mild to severe chronic heart failure and left ventricular dysfunction following a heart attack." Id. The FDA also stated that "[t]he labeling of the generic products may differ from that of Coreg® because parts of the Coreg® labeling are protected by patents and/or exclusivity." [Emphasis added]

Teva in 2004 upon receiving tentative approval Teva issued a press release “describing Teva's carvedilol as the "AB-rated generic equivalent of GlaxoSmithKline's Coreg® tablets." Opinion at page 12. At no time did Teva advise that its carvedilol was not approved for use to treat CHF. The AB rating permitted druggists to substitute carvedilol for Coreg® in filling prescriptions for indications.

 

The question the Court should follow Warner-Lambert and answer whether these acts induce infringement without more.