On January 15, 2020, Hospira filed a petition for rehearing en banc asking the full Federal Circuit to reconsider a prior panel’s analysis of the Safe Harbor provision and reverse the finding of infringement. In December 2019, the Federal Circuit affirmed the District of Delaware’s decision denying Hospira’s motion for judgment as a matter of law and upholding the jury’s verdict that Hospira infringed Amgen’s patent and that some batches of drug substance for Hospira’s erythropoietin biosimilar drug product were not covered by the Safe Harbor provision of 35 U.S.C. § 271(e)(1).

35 U.S.C. § 271(e)(1), also known as the Safe Harbor provision, provides that it shall not be an act of infringement to make use, offer to sell, sell, or import into the United States a patent 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.”

During its initial appeal, Hospira argued that the jury instructions regarding the Safe Harbor provision improperly focused the jury on the reasons why each batch of EPO was made instead of how each batch was used or whether the use was reasonably related to the development and submission of information in Hospira’s BLA. The jury instructions read, “[i]f Hospira has proved that the manufacture of a particular batch was reasonably related to developing and submitting information to the FDA in order to obtain FDA approval, Hospira’s additional underlying purposes for the manufacture and use of that batch do not remove that batch from the Safe Harbor defense.” Op. at 13-14. Hospira argued that it only had to prove the use was reasonably related to the submission of the BLA, not the manufacture.

In its opinion, the Federal Circuit panel disagreed and held that the jury instructions were proper because Section 271(e)(1) “extends to all uses of patented inventions  that are reasonably related to the development and submission of any information under the FDCA” and that each accused activity must be evaluated separately to see if the exemption applies. Op. at 14 (quoting Merck KGaA v. Integra Lifesciences I, Ltd., 545 U.S. 193, 202 (2005)). The Federal Circuit concluded that Amgen’s patented invention was the methods of manufacture and Hospira’s accused activity was the use of those methods of manufacture. The Federal Circuit reasoned that the correct inquiry is whether each act of manufacture was for uses reasonably related to the submission of information to the FDA. The Federal Circuit then held that substantial evidence supported the jury’s finding that some of the batches were not manufactured for the sole purpose of use reasonably related to the development and submission of information to the FDA.

In its recent petition for rehearing en banc, Hospira made two primary arguments: (1) the panel ignored binding legal precedent in its decision; and (2) the panel incorrectly applied a different rule for manufacturing process than the rule for other types of patents.

First, relying on the Supreme Court’s decision in Merck KGaA v. Integra Lifesciences I, Ltd., 545 U.S. 193, 206 (2005), Hospira argued that the panel’s analysis ignores the Supreme Court’s admonition that “all uses” reasonably related to obtaining FDA approval are exempted and that the Safe Harbor provision’s application is broader than just information required for approval. According to Hospira, it is not reasonable to expect an applicant to submit the minimum amount of data required to the FDA. Hospira argued that its accused batches were all used to generate data for the FDA as data from every accused batch was used to revise release specifications in response to the CRL.

Second, Hospira argued that the panel erred when it ruled that “because the patents-in-suit claim methods of manufacture, subsequent uses that are objectively related to obtaining FDA approval cannot bring the making of the EPO within the Safe Harbor if the manufacture itself was not ‘required,’ at the time of manufacture, for seeking FDA approval.” Pet. at 10. Hospira argued that the panel substituted the well-established test regarding the uses of the patented invention with an analysis of the underlying purpose for why each match was made. Hospira argued that the panel erred by applying a different analysis for manufacturing process patents than for other patents.

Hospira emphasized that the previous panel’s decision “threatens to eviscerate the protections Congress intended to provide under the Safe Harbor, particularly in the BPCIA context” and that this issue is of vital importance as manufacturing patents are the focus of many BPCIA cases. Pet. at 15.

We will continue to provide updates as the case continues.

  • Since November 2019, biosimilar versions of pegfilgrastim, rituximab, bevacizumab, and trastuzumab have launched in the United States.
  • FDA approved fifth Humira® (adalimumab) biosimilar, but it will not launch until 2023.
  • FDA approved third Neulasta® (pegfilgrastim) biosimilar and all three have launched.
  • FDA approved fourth Remicade® (infliximab) biosimilar.

As pharmaceutical drug costs attract increasing media attention and political scrutiny, a growing number of biosimilar drugs are set to enter the U.S. and European markets in the coming years.  Global sales for the top ten branded biologic drugs totaled approximately $81 billion in 2018[1].  In the FDA’s Center for Drug Evaluation and Research’s (CDER) annual report, the FDA highlighted the ten biosimilar approvals in 2019 under the Biologics Price Competition and Innovation Act (BPCIA) of 2009, which was “designed to create competition, increase patient access, and potentially reduce cost of important therapies.”  The FDA’s Biosimilars Action Plan, unveiled in 2018, has been designed to aid the development of a market for biosimilars in order to increase competition for biologic drugs, which make up 40% of U.S. pharmaceutical spending.  Competition in the heavily regulated marketplace for these blockbuster therapeutics is expected to substantially impact the pharmaceutical industry and national health systems.  To date, the U.S. has considerably lagged behind Europe’s expansion of biosimilar drug options.  The RAND Corporation estimates that biosimilar products can save the U.S. health system approximately $54 billion over the next decade, as discussed here.

Since 2005, the biosimilar regulatory framework in Europe has been implemented through the Committee for Medicinal Products for Human Use (CHMP) under the European Medicines Agency (EMA).  The CHMP provides initial assessments for marketing authorization of new medicines that are ultimately approved centrally by the EMA.  Since Sandoz’s somatotropin biosimilar, Omnitrope®, was first authorized on April 12, 2006, an additional 59 applications have been approved in Europe.  Seven of the authorizations have been withdrawn post-approval (Table 1).

The U.S. did not implement a regulatory framework for biosimilar evaluation until after enactment of the Biologics Price Competition and Innovation Act (BPCIA) of 2009.  Given that the first U.S. biosimilar drug was approved almost a decade after the first in Europe, the number of authorized biosimilar drugs in Europe far exceeds the number of biosimilars approved in the United States.  Sandoz’s filgrastim biosimilar, Zarxio®, received the first U.S. approval in 2015, whereas nine filgrastim biosimilars have been approved in Europe dating back to multiple authorizations in 2008.  Zarxio® (in the U.S.) and Zarzio® (in Europe) are biosimilar to the reference product Neupogen® marketed by Amgen and originally licensed in 1991.  Subsequent to Zarxio®’s approval, 25 other biosimilar drugs have gained U.S. approval to date (Table 2).

As illustrated in the following graph, while the EU’s significant head start led to an imbalance in the number of biosimilar drugs available in the respective markets, the EU’s relatively higher rate of approvals in recent years has widened its lead over the United States, although the U.S. FDA reversed that trend in 2019 with ten approvals.

Currently, nine biosimilar applications are under review by the EMA for marketing authorization (Table 3).  As an increasing number of patents expire on blockbuster biologic drugs, the number of abbreviated biologics license applications is also increasing.  Biosimilars for at least 24 different original biologics are currently navigating biosimilar pathways or are in late stage development in the U.S. (Table 4).

On November 5, 2019, Sandoz announced the approval of its pegfilgrastim biosimilar ZiextenzoTM.  “When a cancer patient with febrile neutropenia gets an infection, it can have serious consequences such as delays or dose reductions of chemotherapy,” said Carol Lynch, President of Sandoz Inc. “The approval of Ziextenzo expands our oncology portfolio, providing physicians with a long-acting supportive oncology biosimilar option. It builds on the foundation of trust and experience we developed with our short-acting filgrastim Zarxio® – the leading filgrastim by market share in the US – including consistent product supply and reliable patient services.”

On November 18, 2019, Pfizer announced the approval of its adalimumab biosimilar AbriladaTM.  “Biosimilars like ABRILADA represent an opportunity to help improve access to important treatment options for patients living with chronic, and often debilitating, inflammatory conditions,” said Richard Blackburn, Global President, Pfizer Inflammation and Immunology. “Our current portfolio of approved biosimilar products is one of the broadest in the industry and we are proud to offer additional treatment options for patients.”

On December 6, 2019, Amgen announced the approval of its infliximab biosimilar AvsolaTM.  “The approval of AVSOLA represents an important milestone across our biosimilar and inflammation portfolios,” said Murdo Gordon, executive vice president of Global Commercial Operations at Amgen. “Following July’s exciting launches of our two biosimilars in oncology, AVSOLA highlights Amgen’s long-term commitment to providing more affordable biological treatment options to patients across critical disease states, including chronic inflammatory conditions.”

In addition to these biosimilar approvals, on December 23, 2019, AstraZeneca and Daiichi Sankyo Company, Limited (Daiichi Sankyo) announced the approval of EnhertuTM, which is a HER2 directed antibody drug conjugate (ADC) designed to delivery cytotoxic chemotherapy to cancer cells via a human epidermal receptor 2 (HER2) antibody (trastuzumab) attached to a novel topoisomerase I inhibitor payload and a tetrapeptide-based linker.  José Baselga, Executive Vice President, Oncology R&D, said: “Enhertu has shown impressive results in women with HER2-positive metastatic breast cancer, with the majority of women benefiting from treatment and the median duration of the response exceeding 14 months. With this first approval, we are proud to bring Enhertu to patients with high unmet need and we look forward to further exploring its potential in additional settings.” Antoine Yver, Executive Vice President and Global Head, Oncology R&D, Daiichi Sankyo said: “The approval of Enhertu underscores that this specifically engineered HER2-directed antibody-drug conjugate is delivering on its intent to establish an important new treatment for patients with HER2-positive metastatic breast cancer. Since the beginning of our clinical trial programme four years ago, we have focused on the opportunity to transform the treatment landscape for patients with HER2-positive metastatic breast cancer, and we are extremely proud of how quickly we delivered Enhertu to patients in the US, as Enhertu represents one of the fastest-developed biologics in oncology.”

Table 1. European Medicines Agency List of Approved Biosimilar Drugs (updated January 24, 2020).

Table 2. U.S. Food and Drug Administration List of Approved Biosimilar Drugs.

Table 3. European Medicines Agency List of Biosimilars Under Evaluation for Marketing Approval (Source: EMA list of applications for new human medicines compiled on January 6 2020 and published on January 7, 2020).

Table 4. Biologics having already expired or nearing primary patent expiry in the U.S. and biologics that have biosimilars in the regulatory pipeline.

 

[1] Based on sales reported by respective manufacturers (1. Humira—Abbvie ($19.94B), 2. Opdivo—Bristol-Myers-Squibb ($7.57B), 3. Keytruda—Merck ($7.17B), 4. Enbrel—Pfizer/Amgen ($7.126B), 5. Herceptin—Roche ($6.981B), 6.  Avastin—Roche ($6.847B), 7. Rituxan—Roche ($6.75B), 8. Eylea—Aflibercept ($6.551B), 9. Remicade—Johnson & Johnson/Merck ($5.908B), 10. Stelara—Johnson & Johnson ($5.156B)).

For decades, courts have construed the transitional phrase “consisting essentially of” to mean that the scope of a claim is limited to the specified materials or steps “and those that do not materially affect the basic and novel characteristic(s)” of the claimed invention. In re Herz, 537 F.2d 549, 551-52, 190 USPQ 461, 463 (CCPA 1976) (emphasis in original). The Federal Circuit has explained that “[a] ‘consisting essentially of’ claim occupies a middle ground between closed claims that are written in a ‘consisting of’ format and fully open claims that are drafted in a ‘comprising’ format.” PPG Industries v. Guardian Industries, 156 F.3d 1351, 1354, 48 USPQ2d 1351, 1353-54 (Fed. Cir. 1998). On October 10, 2019, the Federal Circuit created a minefield in that middle ground in HZNP Medicines LLC v. Actavis Laboratories UT, Inc. The panel consisted of Judges Reyna, Prost, and Newman, with Judge Newman dissenting as to the majority’s finding that ambiguities as to the “basic and novel properties” of the claimed invention or what constitutes a material alteration of those properties rendered claims reciting “consisting essentially of” indefinite.

The majority explained that two questions arise when claims use the phrase “consisting essentially of”:

  1. What are the basic and novel properties of the invention?
  2. Does a particular unlisted ingredient materially affect those basic and novel properties?

The panel explained that there certainly may be circumstances where it will be up to a fact-finder to determine whether an unlisted ingredient has a material effect on the basic and novel properties of the invention.

In its Markman order, the District court found the term “consisting essentially of” to be indefinite as used in the formulation patent. While the district court found that the specification sufficiently identified five basic and novel properties of the claimed invention — i.e., (1) better drying time; (2) higher viscosity; (3) increased transdermal flux; (4) greater pharmacokinetic absorption; and (5) favorable stability — it concluded that a person of ordinary skill in the art would not be able to have reasonable certainty about the scope of these properties. The district court found that because the basic and novel properties of an invention are part of the construction of a claim containing the phrase “consisting essentially of,” the Nautilus standard applies to the assessment of an invention’s basic and novel properties.  Finding the “drying time” in the specification to be inconsistent among different methods, the district court held that a person of ordinary skill would not have had “reasonable certainty” as to the scope of the basic and novel properties.

The Federal Circuit affirmed the indefiniteness determination of the district court. In evaluating the district court’s determination, the majority analyzed three issues.

First, the majority considered whether the “basic and novel properties” as defined by the district court is within the scope of the claims.  Based on the information disclosed in the specification, the majority found the district court’s identification of the five properties disclosed in the specification as constituting the “basic and novel” properties of the invention to be proper.

Second, the majority determined that the application of the Nautilus definiteness standard on the “basic and novel properties” of invention is appropriate.  The majority explained that the basic and novel properties of an invention are part of the scope of claims reciting “consisting essentially of” and that it follows that those basic and novel properties, when read in light of the specification and the prosecution history, must provide objective boundaries for those of skill in the art. That majority explained that the analysis is fact-specific, i.e., the fact that the basic and novel properties may not be precise does not automatically render them indefinite. Rather, the basic and novel properties must be sufficiently definite so as to inform, with reasonable certainty, a person of ordinary skill of their scope within the context of the invention.

Third, the majority determined whether the district court’s determination of indefiniteness of basic and novel property of “better drying time” was proper. Agreeing with the district court in that the results of “better drying time” in the specification are inconsistent, the majority held that the district court did not err in determining that a person of ordinary skill would not know under what standard to evaluate the drying rate, thus rendering the basic and novel property of “better drying rate” indefinite.

In dissent, Judge Newman argued that usage of “consisting essentially of” should not be a ground of invalidity.  Judge Newman disagreed with the majority’s use of “consisting essentially of” in the claims as opening the claims for evaluation of the “basic and novel properties” as part of the claim construction.  Judge Newman noted that both parties agreed that there were no unlisted ingredients in the allegedly infringing formulations, but the majority focused on the specification and examples and found that two measures of drying time were in Example 5 that provided different results. In Judge Newman’s view, “[d]efiniteness of claiming requires that the subject matter for which patent protection is sought is clearly stated in the claim [; therefore, it] is hard to imagine a clearer statement than a list of the ingredients that the claimed formulation ‘consist essentially of’.” The majority responded to this contention by disagreeing and noting that a clearer statement would be a list of ingredients that the claimed formulation “consists of,” which is a “closed claim” confined to the listed ingredients or steps in a claim.  The majority explained that because the patentee chose to use the distinct and separate phrase, “consisting essentially of,” the patentee can assert its claim against products containing ingredients nowhere listed in the patent claim, but the underlying basic and novel properties of that invention must be sufficiently definite in scope in order to afford clear notice of the claim’s bound.

In response, Judge Newman cites to Conoco, Inc. v. Energy & Envtl. Int’l, L.C., 460 F. 3d 1349 (Fed. Cir. 2006), where the Federal Circuit held that even the term “‘consisting of’ permits ‘aspects unrelated to the invention’.” In her dissent, Judge Newman expressed concern about this decision sowing uncertainty and confusion among countless of composition patents.

There are two major takeaways from the holding of HZNP Medicines LLC, Horizon Pharma USA, Inc., v. Actavis Laboratories UT, Inc.

  1. By using the term “consisting essentially of” in the claims, the Nautilus definiteness standard extends to the “basic and novel properties” identifiable in the specification; and
  2. In order for the “basic and novel properties” to be definite, results relating to the “basic and novel properties” have to be consistent.

It is important to note that the determination held by the Federal Circuit in this case is fact-specific. In fact, the majority emphasized that its determinations are specific to the case at hand.

To be clear, we do not hold today that so long as there is any ambiguity in the patent’s description of the basic and novel properties of its invention, no matter how marginal, the phrase “consisting essentially of” would be considered indefinite. Nor are we requiring that the patent owner draft claims to an untenable level of specificity. We conclude only that, on these particular facts, the district court did not err in determining that the phrase “consisting essentially of” was indefinite in light of the indefinite scope of the invention’s basic and novel property of a “better drying time.”

Despite the majority’s emphasis on the limitation of its holding, the implications of this decision are wide and unsettling.  In the past 20 years, over 32,000 U.S. patents have been granted that recite “consisting essentially of” or a permutation thereof in their claims.  Further, as of November 4, 2019, there are more than 9,000 U.S. patents and published applications with a priority date on or after March 16, 2013, i.e., subject to post grant review, reciting claims containing the transitional phrase “consisting essentially of” or permutations thereof. Significant portions of these patents and applications are drawn to biologics. In fact, A61K 38/00, a classification for peptides, is the second most common Cooperative Patent Classification (“CPC”) among patents and applications reciting claims containing the transitional phrase “consisting essentially of” or permutations thereof. A61K 2039/505, a classification for antibodies, is right behind as the 13th most common classification.

To comply with the majority’s holding in HZNP, in order for such claims to meet the Nautilus definiteness standard, the “basic and novel properties” disclosed in the specification must inform, with reasonable certainty, a person of ordinary skill in the art of their scope within the context of the invention.  The basic and novel characteristics of the claimed invention will now become a major point of contention during the claim construction phase and beyond.  If the specification lacks requisite clarity with regard to the basic and novel properties of the invention, it may be advantageous to obtain a “consisting of” claim rather than the now indefiniteness-susceptible “consisting essentially of” phrase.

Going forward, patent drafters must carefully consider, describe, and support any asserted basic and novel properties in patent specifications to withstand such heightened scrutiny.  Potential ambiguities in testing or measurement techniques must be identified and dealt with at the draft phase.

For patent applicants and owners, any pending applications or granted patents reciting “consisting essentially of” claims should be carefully reviewed and reconsidered. The “basic and novel properties” of these patents should be identified in the specification and analyzed for potential ambiguities.  In the relevant case, the “basic and novel properties” were easily identified by the disclosure in the specification detailing the five advantageous properties the invention had over the prior art as well as the having the five properties in the separate sub-headings. In most patents, the identification of the “basic and novel properties” of claimed inventions are not as easily discernable and will require careful reading of the specification, examples, and its descriptions of the prior art. Furthermore, once the “basic and novel properties” are identified, the data provided in the specification in support of the “basic and novel properties” should be assessed so as to ascertain whether there are any inconsistencies among the data. If any inconsistencies are identified, the applicant or patentee may need to consider filing claim amendments in a pending application or a reissue application for granted patents in order to rehabilitate “consisting essentially of” claims that may not meet the Nautilus definiteness standards for the “basic and novel properties” of the claimed invention.

For potential patent challengers, there are now a large number of granted and pending claims that are susceptible to invalidity challenges for indefiniteness because they recite “consisting essentially of.”  Thousands of such claims have been granted since March 16, 2013 and are therefore eligible for post-grant review based on indefiniteness.  In district court, arguments and evidence for ambiguities in the “basic and novel properties” of claims should be presented early, e.g., at the Markman and summary judgment phases.

  • FDA approves fourth Humira® (adalimumab) biosimilar with launch delayed to 2023.
  • FDA approves second Rituxan® (rituximab) biosimilar, neither of which has launched.
  • FDA approves second Avastin® (bevacizumab) biosimilar, which is expected to launch in late 2019.
  • FDA approves fifth Herceptin® (trastuzumab) biosimilar, which launched in July 2019.
  • European Medicines Agency has not approved any new biosimilars since April 2019.

As pharmaceutical drug costs attract increasing media attention and political scrutiny, a growing number of biosimilar drugs are set to enter the U.S. and European markets in the coming years.  Global sales for the top ten branded biologic drugs totaled approximately $71 billion in 2017[1].  In July 2018, Health and Human Services Secretary Alex Azar announced a Biosimilars Action Plan to aid the development of a market for biosimilars in order to increase competition for biologic drugs, which make up 40% of U.S. pharmaceutical spending.  Competition in the heavily regulated marketplace for these blockbuster therapeutics is expected to substantially impact the pharmaceutical industry and national health systems.  To date, the U.S. has considerably lagged behind Europe’s expansion of biosimilar drug options.  The RAND Corporation estimates that biosimilar products can save the U.S. health system approximately $54 billion over the next decade, as discussed here.

Since 2005, the biosimilar regulatory framework in Europe has been implemented through the Committee for Medicinal Products for Human Use (CHMP) under the European Medicines Agency (EMA).  The CHMP provides initial assessments for marketing authorization of new medicines that are ultimately approved centrally by the EMA.  Since Sandoz’s somatotropin biosimilar, Omnitrope®, was first authorized on April 12, 2006, an additional 59 applications have been approved in Europe.  Six of the authorizations have been withdrawn post-approval (Table 1).

The U.S. did not implement a regulatory framework for biosimilar evaluation until after enactment of the Biologics Price Competition and Innovation Act (BPCIA) of 2009.  Given that the first U.S. biosimilar drug was approved almost a decade after the first in Europe, the number of authorized biosimilar drugs in Europe far exceeds the number of biosimilars approved in the United States.  Sandoz’s filgrastim biosimilar, Zarxio®, received the first U.S. approval in 2015, whereas nine filgrastim biosimilars have been approved in Europe dating back to multiple authorizations in 2008.  Zarxio® (in the U.S.) and Zarzio® (in Europe) are biosimilar to the reference product Neupogen® marketed by Amgen and originally licensed in 1991.  Subsequent to Zarxio®’s approval, 22 other biosimilar drugs have gained U.S. approval to date (Table 2).

As illustrated in the following graph, while the EU’s significant head start led to an imbalance in the number of biosimilar drugs available in the respective markets, the EU’s relatively higher rate of approvals in recent years has widened its lead over the United States, although the U.S. FDA made up some ground in the past quarter.

Currently, nine biosimilar applications are under review by the EMA for marketing authorization (Table 3).  As an increasing number of patents expire on blockbuster biologic drugs, the number of abbreviated biologics license applications is also increasing.  Biosimilars for at least 24 different original biologics are currently navigating biosimilar pathways or are in late stage development in the U.S. (Table 4).

On June 13, 2019, Amgen announced the approval of its trastuzumab biosimilar KanjintiTM.  “The FDA approval of KANJINTI is an important milestone for our biosimilars portfolio, providing an additional treatment option for patients across three types of cancer,” said David M. Reese, M.D., executive vice president of Research and Development at Amgen. “KANJINTI is the third biosimilar from our portfolio to receive FDA approval, highlighting our long-term commitment to providing patients with serious illnesses access to high-quality biological therapies.”  Amgen and Allergan launched KanjintiTM in July 2019.

On June 28, 2019, Pfizer announced the approval of its bevacizumab biosimilar ZirabevTM.  “Biosimilars like ZIRABEV can help increase access to impactful therapies, driving market competition that may ultimately lower costs and help address the diverse needs of patients living with cancer,” said Andy Schmeltz, Global President, Pfizer Oncology. “We are proud to add ZIRABEV to our growing oncology portfolio for U.S. patients living with a wide variety of tumor types.”  While no launch date has been set, ZirabevTM is expected to launch in late 2019 or early 2020.

On July 23, 2019, Pfizer announced the approval of its rituximab biosimilar RuxienceTM.  “Biosimilars like RUXIENCE have the potential to deliver real value in healthcare, improving access to and affordability of an important cancer treatment which could help more patients receive optimal care,” said Andy Schmeltz, Global President, Pfizer Oncology. “The FDA approval marks our third oncology biosimilar to be approved in the U.S. this year, reinforcing our commitment to bring these important medicines to patients living with cancer.”  No launch date has been announced.

Also on July 23, 2019, Samsung Bioepis announced the approval of its adalimumab biosimilar HadlimaTM.  “With the approval of HADLIMA, we are proud to have three anti-TNF biosimilars approved in the U.S. We believe the US healthcare system can benefit from biosimilars which could play a critical role in broadening access to treatment options for patients with autoimmune conditions across the country,” said Hee Kyung Kim, Senior Vice President and Head of Regulatory Affairs, Samsung Bioepis. “We remain committed to advancing our strong pipeline of biosimilar candidates, so that more patients and healthcare systems can benefit from biosimilars.”

The FDA has recently provided useful guidance on biosimilar development under the BPCIA, as reported here.  Under the leadership of Dr. Scott Gottlieb, the FDA advanced new policies aimed at promoting more competition when it comes to biosimilar products as outlined in Dr. Gottlieb’s December 11, 2018 statement on new actions advancing the agency’s biosimilars policy framework.  However, with Dr. Gottlieb’s unexpected resignation on March 5, 2019, it will be up to the next permanent successor to guide stakeholders in navigating the FDA approval process.

Table 1. European Medicines Agency List of Approved Biosimilar Drugs (updated September 17, 2019).

Table 2. U.S. Food and Drug Administration List of Approved Biosimilar Drugs.

Table 3. European Medicines Agency List of Biosimilars Under Evaluation for Marketing Approval (Source: EMA list of applications for new human medicines compiled on September 2, 2019 and published on September 3, 2019).

Table 4. Biologics having already expired or nearing primary patent expiry in the U.S. and biologics that have biosimilars in the regulatory pipeline.

[1] Based on sales reported by respective manufacturers (1. Humira—Abbvie, 2. Rituxan—Roche, 3. Enbrel—Pfizer/Amgen, 4. Herceptin—Roche, 5. Avastin—Roche, 6. Remicade—Johnson & Johnson/Merck, 7. Lantus—Sanofi, 8. Neulasta—Amgen, 9. Avonex—Biogen, 10. Lucentis—Roche/Novartis).

As we previously reported, earlier this year the Federal Circuit affirmed a district court’s finding that Sandoz’s ZARXIO filgrastim biosimilar and proposed pegfilgrastim biosimilar do not infringe Amgen’s patents. The patents-at-issue were Amgen’s U.S. Patent Nos. 8,940,878 (“the ’878 patent”) and 6,162,427 (“the ’427 patent”). The ’872 patent is directed towards methods of purifying proteins expressed in non-mammalian systems in both non-native soluble and non-native insoluble forms. The ’427 patent is directed towards methods of treatment involving administering a hematopoietic stem cell mobilizing-effective amount of G-CSF before administering chemotherapy to the patient. The District Court for the Northern District California construed the claims of both patents and granted summary judgment of non-infringement of claim 7 of the ’878 patent in favor of Sandoz. Amgen later appealed the decision. The Federal Circuit concluded that there was no infringement and that Amgen could not succeed on its doctrine of equivalents theory, explaining that “[t]he doctrine of equivalents applies only in exceptional cases and is not simply the second prong of every infringement charge, regularly available to extend protection beyond the scope of the claims.” See Amgen Inc. v. Sandoz Inc., 923 F.3d 1023, 1029 (Fed. Cir. 2019).

In June, Amgen filed a petition for rehearing en banc. Amgen argued that the Federal Circuit established a bright line rule that the doctrine of equivalents only applies in exceptional cases and that such a rule is contrary to both Supreme Court precedent and the Federal Circuit’s prior precedent. Amgen argued that the panel decision “represents a profound change in the law that appears to impose an equitable standard explicitly rejected by the Supreme Court.” Pet. at 3. Citing several Supreme Court cases, Amgen argued that the idea that the doctrine of equivalents is available in all cases and is assessed without regard to equities is consistent with over 150 years of Supreme Court precedent. Pet. at 5. Amgen went on to state that under the correct doctrine of equivalents standard for assessing infringement, the Federal Circuit erred in affirming the district court’s decision.

On September 3, 2019, the Federal Circuit partially granted Amgen’s petition. The Federal Circuit ordered that the petition is granted such that the portion of the panel’s opinion stating that the doctrine of equivalents “applies only in exceptional cases” is removed. The Federal Circuit denied the rest of the petition, thereby upholding the panel’s ruling of noninfringement. The Federal Circuit did not provide any reasoning in its order but its decision demonstrates that the prior panel was incorrect in establishing a bright-line rule that the doctrine of equivalents only applies in exceptional cases.

The U.S. Food and Drug Administration (FDA) and the E.U. European Medicines Agency (EMA) announced that Slovakia has beeen added to a mutual recognition agreement (MRA) regarding good manufacturing practice (GMP) inspections in the European Union.  Slovakia was the last of the 28 member states of the European Union to be recognized as capable of conducting manufacturing facility inspections which meet FDA requirements. The MRA allows the FDA and the EMA to use inspection reports and other related information obtained by the other agency during manufacturing facility inspections. Either agency can require additional inspections or other actions as necessary to protect the public. The recognition of European drug regulatory authorities as capable of conducting inspections which meet FDA requirements is part of the implementation of the amended Pharmaceutical Annex to the 1998 U.S. – E.U. MRA.

Medicinal products approved for use in the U.S. can be manufactured or contain ingredients manufactured in other countries.  Since all drugs approved in the U.S. must comply with U.S. regulations, FDA inspects both foreign and domestic manufacturing facilities on a regular basis. Prior to implementation of the MRA, both the FDA and the EMA conducted inspections of the same manufacturing facilities and pharmaceutical companies were required to carry out batch testing for products imported into the U.S. even though similar testing had already been carried out in other countries. The full implementation of the MRA will avoid duplication of facility inspections in Europe and the U.S. which will allow the agencies to direct more resources to inspections in other countries. In addition, costs should be reduced for pharmaceutical manufacturers since batch testing for products imported into the U.S. will be waived when such testing has been carried out in a member state of the European Union.

Human drugs and biologics are encompassed by the MRA , however, specified products are still being assessed. Veterinary medicines are still being assessed with a decision expected by December 15, 2019. A decision regarding human vaccines and plasma derived medicines is expected by July 15, 2022; and a decision on products intended for use in clinical trials is expected to be made at an unspecified date in the future.  Products which are excluded from the MRA include human blood and plasma, human tissues and organs, veterinary immunologicals and medicines based on genes, cells or tissue engineering.

The MRA will facilitate market access, encourage harmonization of compliance standards, reduce duplication of inspections and reduce costs by waiving re-testing of products upon importation.

On July 11, 2019, more than 110 House Democrats wrote a letter to U.S. Trade Representative Robert E. Lighthizer expressing strong opposition to provisions in the United States-Mexico-Canada Agreement (USMCA) trade agreement, including the provision setting a minimum of 10 years of marketing exclusivity for biologic drugs.

As discussed here, in the United States, the Biologics Price Competition and Innovation Act (“BPCIA”) already provides for 12 years of data exclusivity for new biologics, exceeding the minimum 10 years under the USMCA. Thus, the USMCA does not purport to extend biologics monopolies in the United States, but instead requires Canada and Mexico to adopt a more similar exclusivity period.  However, two of the signatories to the letter, Representatives Jan Schakowsky, D-Illinois and Rosa DeLauro, D-Connecticut, introduced HR 3379, the Price Relief, Innovation, and Competition for Essential Drugs (PRICED) Act, in June 2019, seeking to shorten the exclusivity period for brand name biologic drug products from 12 years to only 5 years.

The House members argue that the current provisions in the USMCA “would keep drug prices out of reach for patients by increasing and locking in 10 years of marketing exclusivity for brand biologics, expanding the scope of brand biologics eligible for protection, and making it easier for brand-name drug companies to extend their monopolies through additional patents, patent extensions, and other forms of patent ‘evergreening.’”  The signatories warn that the opposed provisions “limit Congress’ ability to adjust the biologics exclusivity period, instead locking the US into policies that keep cancer and other drug prices high.”

The legislators request revisions to the access to medicines provisions in the USMCA to make them consistent with the Bipartisan Agreement on Trade Policy of May 10, 2007 struck during the George W. Bush Administration, summarized here.  That Agreement identified the following particular intellectual property elements:

  • Clarification that the period of protection for test data for pharmaceuticals by developing country FTA partners will generally not extend beyond the period that such protection is available for the same product in the United States, coupled with a provision that will encourage our partners to process marketing approval applications for innovative drugs in a timely manner.
  • Clarification that developing country FTA partners may implement exceptions to normal rules for protecting test data if necessary to protect public health.
  • A more flexible approach, for developing country partners, to restoring patent terms to compensate for processing delays. This flexibility is accompanied by new provisions stipulating that trading partners will make best efforts to process patent and marketing approval applications expeditiously.
  • More flexibility in terms of the types of procedures that developing country partners may implement to prevent the marketing of patent-infringing products.
  • Integration within the intellectual property chapter of a recognition that nothing in the chapter affects the ability of our FTA partners to take necessary measures to protect public health by promoting access to medicines for all, and a statement affirming mutual commitment to the 2001 Doha Declaration on the TRIPS Agreement and Public Health.

Notably, it has been the U.S. Trade Representative’s policy to negotiate trade agreements based on United States laws including the 12 year exclusivity period for biologic drug products.  Accordingly, the USMCA’s 10 year period appears to be a compromise reached with Canada’s current 8 year period.  Nevertheless, the legislators oppose the provision because the USMCA will limit Congress’ ability to reduce the biologics data exclusivity from 12 years to less than the 10 years required by the USMCA.

Given that the USMCA is a trade agreement seeking to protect U.S. trade interests including sales by U.S. pharmaceutical companies into Canada and Mexico, and not an agreement seeking to lower prescription drug prices in the United States, it is unlikely that presupposed benefits of removing the language will outweigh the more tangible benefits of extending biologic product manufacturers’ exclusivity periods in the Canadian and Mexican markets.

Canada implemented its patent term extension program, the Certificate of Supplementary Protection (CSP) framework, on September 21, 2017.  The CSP regime is beneficial to qualifying pharmaceutical product developers because it can add up to two additional years of patent protection.  Notably, CSP is not as beneficial as other major jurisdictions, which generally allow up to five years of patent term extension. The purpose of the CSP regime is, in part, to compensate pharmaceutical product innovators for patent term lost while waiting for regulatory approval in Canada in accordance with the Comprehensive Economic and Trade Agreement (CETA) with the European Union.  Due to CSP’s strict timing requirements, multi-national pharmaceutical companies must pay particular attention to regulatory filing dates for new drug applications in Canada and in other jurisdictions, as well as deadlines for filing CSP applications in Canada.

To be eligible for a CSP, the applicant must obtain an eligible patent, obtain approval by Health Canada via a Notice of Compliance (NOC), follow strict timing requirements, meet various restrictions on claim scope, and pay an application fee.[1]

A patent is eligible if it includes at least one claim directed to a medicinal ingredient or combination of all the medicinal ingredients in a drug, a medicinal ingredient or combination of all the medicinal ingredients obtained by a specified process (product by process claim), or a use of the medicinal ingredient or combination of all the medicinal ingredients in a drug. Pure process claims or formulation claims are considered to not protect the medicinal ingredient or combination of medicinal ingredients per se, and are not considered eligible for a CSP.  Thus, the CSP framework is also more restrictive in terms of the types of claims that are eligible for CSP compared to other major jurisdictions.[2]

The NOC must be the first authorization issued in Canada with respect to the medicinal ingredient or the combination of medicinal ingredients. To be considered the first authorization, the medicinal ingredient or combination must include more than “prescribed variations” from a prior authorization.  Specifically, the medicinal ingredient cannot be: (1) esters, salts, complexes, chelates, clathrates, or other non-covalent derivatives; (2) enantiomers or mixtures of enantiomers; (3) solvates or polymorphs; (4) in vivo or in vitro post-translational modifications; or 5) any combination of (1)-(4), of a previously authorized medicinal ingredient.  As such, the Canadian list of “prescribed variations” is more broadly defined than those in other major jurisdictions.

The prescribed variations list will be particularly restrictive for biosimilars and biobetters compared to other jurisdictions. For example, the human biologic product GAZYVA (obinutuzumab) received Patent Term Extension (“PTE”) of 946 days in the United States.[3] GAZYVA is a leukemia drug marketed by Roche which has a significantly better clinical efficacy than Roche’s earlier drug Rituxan. Although both drugs target the same protein, GAZYVA has a modified glycosylation pattern, making the antibody-tumor complex more recognizable by macrophages. In the United States, only salts and esters are expressly excluded variations.[4] However, GAZYVA would not be eligible for CSP because glycosylation modifications are an excluded variation under Canada’s list of prescribed variations.

For applicants seeking drug approval in the European Union, any member country of the European Union, the United States, Australia, Switzerland or Japan, the applicant must file for new drug approval with Health Canada no later than 12 months after filing in these countries.[5]  While, the 12 month filing requirement for the new drug submission may incentivize pharmaceutical developers to file new drug applications in Canada sooner, the 12-month filing requirement will add new complexities and considerations for multi-national pharmaceutical companies. For example, filing for approval in another country too soon would cause an applicant to forfeit patent term extension in Canada.  Additionally, the CSP application must be filed within 120 days following the issuance of the NOC or within 120 days of the patent’s grant date, whichever occurs later.

To date, 42 applicants have filed CSP applications. Of those, 29 have been issued a CSP, 7 have been refused, and 6 are pending.[6]  Notably, application 900011 for Rebinyn® (Coagulation Factor IX (recombinant), glycoPEGylated) was rejected because it only varied from the authorized medicinal ingredient by post-translational modifications, namely pegylation and different glycosylation patterns. In Canada, the patent for Rebinyn® (CA 2,462,930) will expire August 2022, while U.S. patent 7,138,371 received 381 days PTE and is not expected to expire until November 2023. [7]

Overall, the CSP framework adds complex new variables for pharmaceutical companies to consider when developing and executing global regulatory strategies.  It also creates new considerations when implementing patent strategies, e.g., targeted claim drafting and timing of patent prosecution procedures to ensure eligibility and maximization of patent term extension under the CSP framework.  To take advantage of the new framework, multi-national pharmaceutical companies will need to update regulatory and patent filing procedures as well as increase communications between regulatory personnel, in house patent portfolio managers, and outside patent prosecution counsel.

[1] See Guidance Document – Certificates of Supplementary Protection, Gov’t Can., https://www.canada.ca/en/health-canada/services/drugs-health-products/drug-products/applications-submissions/guidance-documents/register-certificates/certificate-supplementary-protection-regulations.html#a228 (last modified Mar. 28, 2019).

[2] See, e.g., 35 U.S.C. § 156(a) (“The term of a patent which claims a product, a method of using a product, or a method of manufacturing a product shall be extended in accordance with this section from the original expiration date of the patent . . . .”).

[3] Letter from Mary C. Till, Senior Legal Advisor, USPTO, to Catherine M. Polizzi, Morrison & Forester LLP (Nov. 20, 2017) (enclosing a certificate under 35 U.S.C. § 156 extending the term of U.S. Patent No. 6,602,684 for a period of 946 days).

[4] 35 U.S.C. §156(f)(2)(B).

[5] Previously, applicants were extended an extra 12-month grace period for a total of 24 months. However, this only applied if the CSP application was filed before September 21, 2018, the first anniversary of the day on which section 59 of the CETA Implementation Act comes into force.

[6] See Certificates of Supplementary Protection (CSP) and Applications, Gov’t Can., https://www.canada.ca/en/health-canada/services/drugs-health-products/drug-products/applications-submissions/guidance-documents/register-certificates.html (last modified June 18, 2019).

[7] See Certificates of Supplementary Protection (CSP) and Applications, supra note 6; Determination of Regulator Review Period for Purposes of Patent Extension; REBINYN, 83 Fed. Reg. 54112 (Oct. 26, 2018).

In a recent precedential opinion[1], the Federal Circuit rejected arguments by Amgen that a single step purification process used by Sandoz for its G-CSF biosimilar infringed claims of Amgen’s patent describing a multistep purification procedure for proteins expressed in a non-mammalian system.

In this case, the Federal Circuit explained that the doctrine of equivalents is not a second prong to patent infringement that enables patent holders to extend the scope of their claims, but rather applies only to exceptional cases.

The appeal stems from two decisions out of the Northern District of California related to patent infringement actions brought by Amgen, Inc. and Amgen Manufacturing, Ltd. (“Amgen”) against Sandoz Inc., Sandoz International Gmbh, and Sandoz Gmbh (“Sandoz”).  The appeal centers on the lower court’s grant of summary judgement of noninfringement of claim 7 of Amgen’s U.S. Patent No. 8,940,878 (“the ’878 patent”) and claim 1 of Amgen’s U.S. Patent No. 6,162,427 (“the ’427 patent”) by Sandoz’s filgrastim biosimilar and its proposed pegfilgrastim biosimilar.

Amgen’s primary patents covering its filgrastim and pegfilgrastim biologics (marketed as Neupogen® and Neulasta®, respectively) expired in 2013 and 2015.  Amgen’s ’878 patent is directed to purifying proteins expressed in non-mammalian systems in both non-native soluble and non-native insoluble forms, including direct capture of such proteins from a refold mixture or a cell lysate pool by a separation matrix.

Sandoz submitted an abbreviated Biologics License Application (“aBLA”) to the Food and Drug Administration (“FDA”) in 2014 in order to market its filgrastim biosimilar, which it later launched after receiving approval in 2015.  Sandoz also submitted an aBLA to market its pegfilgrastim biosimilar in 2016, which has not yet been approved.  Subsequently, Amgen filed an amended infringement complaint in connection with the Sandoz’s filgrastim biosimilar product and later filed an infringement complaint in connection with Sandoz’s pegfilgrastim application, asserting its ’878 and ’427 patents.

In its complaint, Amgen asserted, inter alia, that the process used by Sandoz to manufacture its biosimilar products infringes claim 7 of the ’878 patent.  The purification process used by Sandoz involves a single anion exchange chromatography step with one solution that comprises continuously flowing a refold solution containing filgrastim, a detergent, and other selected components, through a separation matrix.

Claim 7 of Amgen’s ’878 patent recites, in pertinent part:

A method of purifying a protein expressed in a non-native limited solubility form in a non-mammalian expression system comprising…

(e) directly applying the refold solution to a separation matrix under conditions suitable for the protein to associate with the matrix;

(f) washing the separation matrix; and

(g) eluting the protein from the separation matrix, wherein the separation matrix is a non-affinity resin selected from the group consisting of ion exchange, mixed mode, and a hydrophobic interaction resin.

The ’878 patent describes standard capture media used in (e)-(g), providing that the “separation matrix” can be affinity resin, such as an affinity resin selected from the group consisting of Protein A, Protein G and a synthetic mimetic affinity resin, or it can be a non-affinity resin, such as a non-affinity resin selected from the group consisting of ion exchange, mixed mode, and a hydrophobic interaction resin[2].

After applying the refold solution to the separation matrix, the method further comprises (f) “washing the separation matrix” with “any composition, as long as the composition and pH of the wash buffer is compatible with both the protein and the matrix” and (g) “eluting the protein from the separation matrix” using “a solution that interferes with the binding of the adsorbent component of the separation matrix to the protein.”[3]

The district court construed the elements (e)-(g) of claim 7 as three separate steps, including:

(e) applying the refold solution to a column that contains the separation matrix…,

(f) adding a solution into the column…to remove materials in the refold solution that do not interact with the separation matrix…; and

(g) adding a solution into the column…which [h]as the effect of reversing the interactions between the protein and the separation matrix….

(Emphasis added)[4].  As a result, the lower court granted summary judgment that Sandoz’s single step purification process for its filgrastim and pegfilgrastim biosimilars does not infringe claim 7 of the ’878 patent.

Appealing to the Federal Circuit, Amgen argued that the claims of the ’878 patent cover any number of solutions or steps[5]. Amgen asserted that the claim only specifies that the washing and eluting steps are performed in sequence[6].  Amgen argued that, as a result, Sandoz’s purification process infringes claim 7 of the ’878 patent because the refolding solution flowing through the separation matrix would be washed and eluted at any point along the matrix[7].

In response, the Federal Circuit found that the claims when read in light of the specification clearly define the washing and separating procedures as separate functional steps[8].  As a result, the Court found that Sandoz’s purification process employing a single step and solution does not literally infringe claim 7 of the ’878 patent[9].

Amgen also argued that Sandoz’s purification process infringes under the doctrine of equivalents because it “achieves the same functions (washing and eluting), in substantially the same way (binding protein preferentially compared to contaminants, and then raising salt concentration to reverse protein binding) to achieve the same result (protein purification).”[10]

The Federal Circuit responded that Amgen argued beyond the scope of the claims in the ’878 patent.  The Court held that Sandoz’s single step purification process does not function in substantially the same way as the claimed three step process[11]. In this regard, the Court asserted that “[t]he doctrine of equivalents applies only in exceptional cases and is not ‘simply the second prong of every infringement charge, regularly available to extend protection beyond the scope of the claims.’”[12]  Thus, the Court declined to extend the scope of the claims reciting “refolding, “washing,” and “eluting” to cover “nearly any type of adsorbent chromatographic separation” under a doctrine of equivalence, thereby effectively reading out the additional steps required by the claim[13] 

Amgen also appealed a decision by the lower court that Sandoz did not infringe claim 1 of the ’427 patent.  The ’427 patent involves administering G-CSF before providing chemotherapy to a patient.  In pertinent part, claim 1 of the requires “administering to the patient a hematopoietic stem cell mobilizing-effective amount of G-CSF” and “thereafter administering to the patient a disease treating-effective amount of at least one chemotherapeutic agent.”

The lower court construed a “disease treating-effective amount of at least one chemotherapeutic agent” as “an amount sufficient to treat a disease for which at least one chemotherapeutic agent is prescribed.”[14]

Amgen argued that the “disease treating-effective amount” includes administering a chemotherapeutic for the purpose of mobilizing stem cells[15].

The Federal Circuit disagreed, finding that “disease treating-effective amount” requires an amount of chemotherapeutic sufficient to treat the underlying disease[16].

The Court explained that Amgen cannot read the claims differently than they are drafted, specifically, “[h]ad Amgen simply wanted to claim a method of mobilizing stem cells, in any context, it could have done so.”[17]

While the Court’s ultimate conclusion regarding the claim language at issue may not be surprising, after the Court’s ruling in this case, patentees may find enforcing a broader scope of their patent claims more difficult going forward.  As a result, practitioners may need to keep the court’s narrowed view of the doctrine of equivalents in mind for all areas of claim construction practice.

Both inventors and practitioners may also need to be mindful of this case when drafting claims and prosecuting application before the USPTO.  The Court’s decision highlights a heightened need for express language capturing the desired subject matter to be claimed, as it may be more difficult to assert claims under the doctrine of equivalents.

[1] Amgen, Inc. v. Sandoz Int’l GmbH, Appeal No. 2018-1551, slip op. (Fed. Cir. May 8, 2019)

[2] ’878 patent at col. 2, lines 7-12.

[3] ’878 patent at col. 15 line 47 – col. 16, line 9.

[4] Amgen, slip op. at 8

[5] Amgen, slip op. at 8.

[6] Id.

[7] Id.

[8] Id.  (citing Mformation Techs., Inc. v. Research in Motion Ltd., 764 F.3d 1392(Fed. Cir. 2014)); see e.g., (“a claim “requires an ordering of steps when the claim language, as a matter of logic or grammar, requires that the steps be performed in the order written, or the specification directly or implicitly requires”) (citingTop of Form TALtech Ltd. v. Esquel Apparel, Inc., 279 F. App’x 974, 978 (Fed. Cir. 2008)).

[9] Amgen, slip op. at 9.

[10] Id. at 10 (citing Appellant Br. 52).

[11] Id. at 11.

[12] Id. (quoting London v. Carson Pi-rie Scott & Co., 946 F.2d 1534, 1538 (Fed. Cir. 1991)).

[13] Id.at 11.

[14] Id. at 6.

[15] Id. at 14.

[16] Id. at 15.

[17] Id.

On May 20, 2019, the PTAB denied a request for rehearing in Apotex Inc. v. Amgen Inc., Case IPR2016-01542 (Paper 67), but modified its Final Written Decision. In the Final Written Decision, the PTAB found claims 1-17 and 19-24 of U.S. Patent No. 8,952,138 (“the ’138 patent”) unpatentable. The ’138 patent is directed towards a method of refolding a protein expressed in a non-mammalian expression system. Only claim 18 was found patentable, which depends from claim 1 and recites that “the incubation is performed under non-aerobic conditions.”

In its request for rehearing, Apotex asserted that the grounds for rehearing were the PTAB’s interpretation of the claim term “non-aerobic conditions” and the PTAB incorrectly concluded that Apotex failed to demonstrate that claim 18 was unpatentable. The PTAB ordered additional briefing including an opposition to the request for rehearing and briefs from both parties regarding the meaning of the claim term “non-aerobic conditions.”

Apotex argued that the PTAB adopted an erroneous construction of the term “non-aerobic conditions” and that the specification provides a special definition for the term. The specification provides that the term means “any reaction or incubation condition that is performed without intentional aeration of the mixture by mechanical or chemical means.” Paper 67 at 3. The PTAB agreed that it overlooked the special definition in the specification but concluded that the Apotex did not include a proposed construction for “non-aerobic conditions” in its Petition. Apotex argued that its Petition addressed the construction through its statement that “the challenged claims must be given their broadest reasonable interpretations in light of the specification of the ’138 patent. To be clear, any claim terms not included in the following discussion should be given their broadest reasonable construction in light of the specification.” Paper 67 at 4-5. The PTAB disagreed, concluding that the statement does not specifically point it to the special definition of the claim term and instead treats the term as having its plain and ordinary meaning.  The PTAB argued that “non-aerobic” means “the absence of oxygen” when not given a special meaning.

The PTAB then examined various portions of the Petition and expert declaration cited by the Apotex as providing support for its argument that it addressed the issue of the special construction of “non-aerobic conditions.” However, the PTAB was not persuaded. The PTAB argued that there is nothing in the expert declaration suggesting that a special definition for “non-aerobic conditions” existed. The PTAB argued that Apotex’s statement in the Petition that it would have been obvious to “eliminate oxygen from the refolding reaction” was the clearest statement indicating that Apotex meant for “non-aerobic conditions” to mean the elimination of or absence of oxygen. However, it was not enough.  Amgen argued in its Opposition that Apotex’s Request for Rehearing was based on arguments not present its Petition or Reply and the PTAB agreed. Because Apotex failed to demonstrate where the claim construction issue was presented to the PTAB, the PTAB denied the request for rehearing.

However, the PTAB still decided to address the issue of claim construction of “non-aerobic conditions” in view of the additional briefing. The PTAB stated that it requested additional briefing “because the term is expressly defined and we wish to ensure the decision is legally accurate and each party has had adequate opportunity to provide input on the broadest reasonable interpretation of the term.” Paper 67 at 11.

Both parties agreed that the meaning of “non-aerobic conditions” is the express definition provided in the specification. In view of the agreed upon definition, the PTAB then decided to modify its Final Written Decision as it pertains to claim 18. Generally, courts have held that administrative agencies “possess inherent authority to reconsider their decisions, subject to certain limitations, regardless of whether they possess explicit statutory authority to do so.”  Paper 67 at 11 (citing Tokyo Kikai Seisakusho, Ltd. v. United States, 529 F.3d 1352, 1360-61 (Fed. Cir. 2008)). Using the special definition of “non-aerobic conditions”, the PTAB concluded that claim 18 only requires that a reaction be performed without the intentional aeration of the mixture by chemical or mechanical means and because the two prior art references cited by Apotex do not describe intentional aeration, they meet the requirement of claim 18. The PTAB concluded that Apotex demonstrated claim 18 is unpatentable as obvious in view of the prior art and modified its previous decision to reflect this conclusion.