Federal Circuit Hands Mixed Ruling to Momenta on 271(g) and 271(e)(1) Issues

Momenta and Sandoz v. Teva, No. 2014-1274 (Fed. Cir.)

Momenta and Sandoz v. Amphastar, No. 2014-1276 (Fed. Cir.)

    by Aaron F. Barkoff

In a precedential opinion today, in companion cases concerning generic enoxaparin, the Federal Circuit reached two decisions that pharmaceutical companies should take note of:

1.    Teva's enoxaparin is not "made by" a patented process within the meaning of § 271(g) because the process is used merely "to ensure that the intended product or substance has in fact been made."  In other words, the process simply "provides information regarding a substance that has already been made but does not transform it."

2.    The safe harbor of § 271(e)(1) does not apply to Amphastar's "routine quality control testing of each batch of generic enoxaparin as part of the post-approval, commercial production process."

Momenta and Sandoz, which were the first to market a generic version of Sanofi's anticoagulant Lovenox (enoxaparin), asserted U.S. Patent No. 7,575,886 against Teva and Amphastar.  The '886 patent claims methods for analyzing enoxaparin to determine whether it has the appropriate chemical structure.  Momenta alleged that Teva's and Amphastar's enoxaparin manufacturing processes infringe the '886 patent.

The Federal Circuit's decision concerning § 271(g) was a split decision, with Judges Wallach and Moore in the majority and Judge Dyk dissenting.  According to the majority opinion, Momenta argued that its patented method "is used [by Teva] to select and separate batches of intermediate drug substance that conform to USP requirements for enoxaparin from batches that do not," and that selected batches are then used to make the finished drug product.  The majority concluded, "Although Momenta's arguments are not without merit, it is more consonant with the language of the statute, as well as with this court's precedent, to limit § 271(g) to the actual 'ma[king]' of a product, rather than extend its reach to methods of testing a final product or intermediate substance to ensure that the intended product or substance has in fact been made."

Judge Dyk, in dissent, argued that "the quality control testing method of the '886 patent is a necessary intermediate step in the manufacture of enoxaparin."  He warned:

Patents on purification methods or the quality control method at issue here, which may be integral to the regulatory or commercial viability of a product, but which do not create or transform a product, combine components, or confer new properties, could be freely infringed simply by outsourcing those processes abroad.  Congress could not have intended to create this loophole when it sought to protect process patent owners from foreign competitors using U.S. manufacturing processes abroad.

The Federal Circuit's decision concerning the 271(e)(1) safe harbor is especially interesting because the court previously reached the opposite conclusion during the preliminary injunction phase of the case (Momenta I).  There, the court found that Amphastar's testing according to the patented method was protected by the safe harbor because it was "necessary both to the continued approval of the ANDA and to the ability to market the generic drug."  The majority in that case distinguished the facts from those in Classenwhere the court held that § 271(e)(1) "does not apply to information that may be routinely reported to the FDA, long after marketing approval has been obtained."  In Momenta I, Judge Moore wrote the opinion for the majority, which included Judge Dyk, while Chief Judge Rader vigorously dissented.

This time around, the panel (which again included Judges Dyk and Moore) unanimously held that § 271(e)(1) does not exempt Amphastar's testing.  The court states, "With the benefit of additional briefing in the current appeals, which reflects the full district court record developed by all parties after the preliminary injunction phase, we conclude Amphastar's submissions are appropriately characterized as 'routine.'"  According to the court, "The conclusion in Momenta I that Amphastar's commercial use of Momenta's patented method falls within the safe harbor of § 271(e)(1) would result in manifest injustice.  Amphastar points to no case, until Momenta I, extending immunity under § 271(e)(1) to encompass activities related to ongoing commercial manufacture and sale."  Thus, the court vacated the district court's grant of summary judgment to Amphastar and remanded the case.

Federal Circuit Hands Mixed Ruling to Momenta on 271(g) and 271(e)(1) Issues