There is more backlash by generic drug companies against the user fees for generic drug reviews proposed in the 2008 budget. The budget proposal would increase funds for FDA by $100 million, including a large increase in user fees for brand-name pharmaceutical companies and the first fees for generic pharmaceutical companies. The $2.1 billion FDA budget includes almost $444 million in user fees from industries regulated by the agency, with $15.7 million in fees from generic pharmaceutical companies.

The user fee program, which was first authorized by the Prescription Drug Use Fee Act (PDUFA) in 1992, helps fund the FDA’s human drug review program achieve demanding performance goals. Over the years, the PDUFA programs, which have to be reauthorized by Congress every five years, have enabled the agency to dramatically reduce its review times for drugs and biological medications while increasing scientific consultations, clarifying issues involving drug development, and increasing oversight of postmarket safety. Pharmaceutical Research and Manufacturers of America (PhRMA) estimates that pharmaceutical companies will fund almost 60% of the cost of FDA reviews of applications for prescription drugs in FY 2008, compared with about 40% in FY 1998.

The biggest recommended increase, of $29.3 million, would provide a major boost for FDA activities to ensure the safety of medications after they are on the market. The increased funds would be available for FDA drug safety activities for marketed medications throughout as long as they remain on the market and would increase FDA’s drug safety capacity for surveillance including hiring an additional 82 employees to perform postmarket safety work.

Another $4.6 million in new user fees and 20 employees will go to help expand FDA’s implementation of guidance for FDA’s reviewers (Good Review Management Principles) and develop guidelines for industry on clinical trial designs and other topics; and additional $4 million to improve the information technology activities for human drug review by moving the agency and industry towards an all-electronic environment.

The Generic Pharmaceutical Association (GPhA) counters that the slow entry of generics on the market are due to the brand name companies actions including citizen petitions and authorized generics (generic drugs launched by brand companies during the 180-day exclusivity period).

The FDA contends that the user fees would help it process applications for generic drugs - the FDA has a backlog of more than 1,200 generic drug applications. They are also looking into ways to address citizen-petition issues. A recent study found that 76 percent of citizen petitions filed between 2000 and 2005 were ultimately dismissed by the FDA as having no merit. GPhA is urging Congress to act against “the abuse of the citizen petition process” while PhRMA is against banning authorized generics or limiting citizen petitions.

These concerns are being driven by the fact that the U.S. generic drug companies are facing shrinking profit margins as global competition increases in the $60 billion market for generic drugs. Patented drugs worth approximately $16 billion a year are set to expire this year alone. This has prompted a lot of outcry from the generic companies over the so-called authorized generics. 

The provisions of the Drug Price Competition and Patent Term Restoration Act of 1984 (Hatch-Waxman Amendments) which govern the generic drug approval process give 180 days of marketing exclusivity to certain generic drug applicants. The statute provides an incentive of 180 days of market exclusivity to the “first” generic applicant who challenges a listed patent by filing a paragraph IV certification and running the risk of having to defend a patent infringement suit.

The provisions of the (Hatch-Waxman Amendments) which govern the generic drug approval process give 180 days of marketing exclusivity to certain generic drug applicants. The statute provides an incentive of 180 days of market exclusivity to the “first” generic applicant who challenges a listed patent by filing a paragraph IV certification and running the risk of having to defend a patent infringement suit.

The statute provides that the first applicant to file a substantially complete ANDA containing a paragraph IV certification to a listed patent will be eligible for a 180-day period of exclusivity beginning either from the date it begins commercial marketing of the generic drug product, or from the date of a court decision finding the patent invalid, unenforceable or not infringed, whichever is first.

Authorized generics are brand pharmaceutical products re-branded as generics and aimed at discouraging generic companies from challenging questionable brand patents. Under federal law, the generic company that is first to successfully challenge a questionable brand patent, file an abbreviated new drug application (ANDA) with FDA and receive approval to market that drug product is awarded 180 days of marketing exclusivity. During the 180-day period, that generic company alone is permitted to compete with the brand company, allowing the generic to recoup costs incurred for undertaking a patent challenge.

Brand drug makers have figured out that by re-labeling their own product, they can compete directly against the generic during the 180-period. Authorized generics are considered brand products by the FDA, so the authorized generic does not have to go through the abbreviated approval process required by a true generic. Brand companies argue that authorized generics increase competition and lower prices, but the Federal Trade Commission (FTC) thinks differently.  Sales of an authorized generic during the exclusivity period can cut the generic maker’s profits by 59 percent.Prescription Drug User Fee Rates for Fiscal Year 2007 (PDF)

PDUFA Fact Sheet 

Posted February 27th, 2007 by Stephen Albainy-Jenei in FTC, FDA
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While the Supreme Court ruled that MedImmune could sue Genentech for patent infringement even though MedImmune continues to pay fees to Genentech to use the disputed technology to develop the drug Synagis, the U.S. Patent and Trademark Office may have something to add, too. (Medimmune, Inc. v. Genentech, Inc., et al.; S.Ct. No. 05–608).

MedImmune is paying licensing fees to Genentech for an antibody technology used in MedImmune’s pediatric respiratory drug Synagis, while at the same time challenging Genentech’s patent in court. The patents at issue, U.S. Pat. Nos. 4,816,567 and 6,331,415, relate to antibodies and to non-specific immunoglobulins formed by recombinant techniques using host cell cultures. The antibodies can be manipulated at the genomic level to produce chimeras of variants, which draw their homology from species, which differ from each other. They can also be manipulated at the protein level, since all four chains do not need to be produced by the same cell.

Currently, the USPTO is reviewing Genentech’s Cabilly patent under concurrent proceedings for an Inter Partes Reexamination (RE Appl. No. 90/007,542) and an Ex Parte Reexamination (RE Appl. No. 90/007,859). In an earlier ruling, the U.S. Patent and Trademark Office (USPTO) issued an obviousness-type double-patenting rejection and a “Schneller-type” double patenting rejection on the Genentech patent indicating that the patent, awarded in 2001, covered basically the same invention as an earlier Genentech patent that was set to expire next March. Those rejections have now been withdrawn.

On February 16, the USPTO issued a final action rejecting all of the claims as being anticipated under U.S. Pat. No 5,840,545 (Moore et al.) and/or obvious in light of Moore alone or combined with U.S. Pat. No. 4,399,216 (Axel) and/or the Accolla reference. The claims also were rejected under various groupings for nonstatutory obviousness-type double patenting in light of U.S. Pat. No. 4,816,567 (Cabilly I) and various other references.

While appeals through the USPTO and courts may take years, this could eventually cost Genentech severely since several companies, including Abbott Laboratories, Centocor Inc. and Imclone Systems Inc., paid Genentech a combined $105 million in royalties related to the patent last year.

Posted February 21st, 2007 by Stephen Albainy-Jenei in USPTO
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Earlier, Novozymes won a patent infringement suit against Danisco concerning infringement of a Novozymes patent on enzymes for bioethanol. The court ordered Danisco to pay damages of $4 million, which has now been doubled to $8 million as the court found the case to be one of ‘willful infringement’. Novozymes was also awarded a share of its attorney’s fees and costs.

Novozymes said it had contacted Danisco warning that the patent was about to issue and warned them to stop making and selling its Spezyme Ethyl product, an alpha amylase enzyme used in ethanol production. Since they refused to withdraw their product after being put on notice of the patent, the infringement was found to be willful. The court also issued a permanent injunction against Danisco but Genencor has launched a new product – Spezyme Xtra – to replace Spezyme Ethyl.

Spezyme Ethyl is a thermostable alpha-amylase enzyme for the liquefaction of starch at high temperatures and is used in the production of bioethanol. In March, 2005, Novozymes A/S filed a complaint against Danisco’s subsidiary Genencor in the United States District Court for the district of Delaware for patent infringement under U.S. Patent No. 6,867,031. The complaint, which was filed the same day Novozymes’ patent issued, focused on the manufacture, use and or sale of Genencor’s SPEZYME® Ethyl, a high performance amylase enzyme that is sold to the fuel ethanol industry.

The ‘031 patent claims a variant of a parent Bacillus stearothermophilus alpha-amylase. The variant improves the stability of alpha-amylases which are obtainable from Bacillus strains and which themselves had been selected on the basis of their starch removal performance in alkaline media.

We’ll leave the discussions of the politics and economic long-term viability of bioethanol as an alternate fuel to others.

Posted February 21st, 2007 by Stephen Albainy-Jenei in IP Litigation
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Representatives Waxman, Emerson, and Pallone, along with Senators Schumer and Clinton, have re-introduced H.R. 1038, the “Access to Life-Saving Medicine Act,” which will establish a process through which the FDA will be able to approve generic biologics or biopharmaceuticals. While generic drugs have been extremely successful in bringing down the high cost of prescription drugs, there is currently no FDA pathway for getting approval for biogenerics.

It is estimated that generic drugs save about $10 billion a year and many would like to see this same result with expensive biotech drugs, many of which cost tens of thousands of dollars a year, even after patent expiration. Pharmacy benefit manager Express Scripts Inc., conducted a study showing that the average biotech drug costs $71,600 a year, compared with the annual average for a traditional drug of $1,200. It said that escalating biotech drug costs, which reached $40 billion in 2005, are expected to more than double in four years to a total of $90 billion in 2009, a rate three times faster than traditional drug costs. While they predict a savings of at least $71 billion over 10 years if there was a regulatory mechanism that allowed for the marketing of biogenerics, BIO cautioned against forecasting any savings from generic biotech drugs without knowing how much testing regulators would require.

In summary, H.R. 1038 provides for the following:

Amends section 351 of the Public Health Service (PHS) Act to authorize the Secretary of HHS to approve abbreviated applications for biological products that are “comparable” to previously approved (reference) biological products.

An application for a comparable biological product must demonstrate that there are no clinically meaningful differences between the two products with respect to safety or effectiveness. The application must also show that the new product and the reference product contain highly similar “principal molecular structural features” and the same mechanism(s) of action, if known.

The Secretary has discretion on a product-by-product basis to determine what studies are necessary to establish comparability. Unlike the sharply limited studies that can be required for traditional generic drugs, the Secretary is given authority to require one or more clinical studies in an application for a comparable biological product, if necessary to establish that the new product has comparable safety, purity, and potency to the reference product.

An application for a comparable biological product will be subject to user fees.

An applicant for a comparable biological product may elect, but is not required, to establish interchangeability. The Secretary is given discretion to determine what studies are required to establish interchangeability. The bill grants the first applicant to obtain approval of an interchangeable version of a biological product a period of exclusive marketing during which no other interchangeable version of the product may be approved.

Applicants for comparable biological products may elect to ask the holder of the reference product for a list of patents on the product and may elect to notify the reference product holder and owner of one or more of the patents identified that the applicant has filed a comparable biological product application. If the applicant sends such a notice, it must contain a detailed statement explaining why the identified patent(s) is invalid, unenforceable, or not infringed. If the reference product holder fails to disclose a relevant patent, it may not enforce that patent against that applicant. If no patent infringement action is brought within 45 days of notice of a challenge, the remedy in any later action to enforce that patent against that applicant is limited to a reasonable royalty.

While the FDA has approved Novartis AG’s Omnitrope hormone, there has not been a change in the stance taken by the FDA on generic biotechnology drugs. Omnitrope was approved only after a federal judge ordered the FDA to decide after a long delay. Also, Omnitrope is considered less complicated than most other biologics.Under both the Federal Food Drug and Cosmetic Act and the Food Prescription Drug User Fee Act, the FDA is required to either approve or reject new drug applications. However, no biogenerics (or follow-on proteins) have yet been approved in the US pharmaceutical market beyond Omnitrope.

The reason for the lack of a regulatory pathway for approval of biogenerics lies in the complexity of the biological products themselves. Biologics are large, complex, heterogeneous molecules for which the manufacturing process can be a determinant of the end product. Demonstrating that a generic version of the product is as safe and effective as the brand name product would be a difficult at best since, for example, establishing that immunogenicity had not been altered and that any undetected differences in the product would not impact safety and efficacy would be problematic without conducting extensive clinical trials.

With Omnitrope, the FDA, however, went out of its way to say that Omnitrope is not a generic biologic stating that “Omnitrope is not rated as therapeutically equivalent to (and therefore substitutable for) any of the other approved human growth hormone products. Omnitrope is more appropriately characterized as a “follow-on protein product.”

The FDA indicated that the approval of Omnitrope in a 505(b)(2) application does not establish a pathway for approval of follow-on products for biological products licensed under section 351 of the Public Heath Service Act, nor does it mean that more complex and/or less well understood proteins approved as drugs under the Food, Drug, and Cosmetic Act could be approved as follow-on products.

See the full text (pdf) of the bill here.

Posted February 16th, 2007 by Stephen Albainy-Jenei in Biogenerics, FDA
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On February 12, the House of Representatives approved a pilot program (HR 5418) to develop an opt-in for specialized patent trial judges. The legislation was introduced by Representatives Issa (R-CA) and Schiff (D-CA). Senator Orrin Hatch (R-UT) and Senator Dianne Feinstein (D-CA) have already introduced S. 3923 as a companion bill to H.R. 5418.

The goal is to develop some patent expertise at the trial level and, hopefully, result in a reduction in the number of cases that get reversed by the Federal Circuit (currently about 50%). Depending on how the program goes, it could ultimately reduce some of the uncertainty and cost associated with patent litigation. It might also mean shorter discovery times if these patent-specific judges make a priority of setting dates for Markman hearings (patent claim constructions) sooner than later.

The pilot will last for 10 years with periodic check-ins. At least 5 courts will be initially selected for the program, preferably from those courts experiencing the highest number of patent cases. Some of the checkpoints that will be analyzed include:

* To what extent has the program succeeded in developing patent expertise among trial judges?
* Has patent expertise improved the timeline of patent cases?
* Do opt-in judges have a lower rate of reversal than other judges who keep their patent cases?
* Is there any evidence of forum shopping as a result of the pilot?

The legislation appears to have bi-partisan support and is expected to become law before the close of the current Congressional session.

Today’s post comes from Guest Barista Ria Schalnat, a registered patent attorney in Frost Brown Todd’s Cincinnati office.

Posted February 15th, 2007 by Stephen Albainy-Jenei in USPTO
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Rep. Xavier Becerra from Southern California, and Rep. Dave Weldon of Florida have introduced the Genomic Research and Accessibility Act, a bill that would end the practice of patenting any and all portions of the human genome. They point out that the Human Genome Project has led to the discovery of approximately 35,000 genes and approximately twenty percent of those genes have already been granted patents by the United States Patent and Trademark Office (USPTO).

“The practice of gene patenting is preventing critical research from advancing because scientists are wary of trespassing patent laws,” Rep. Weldon said. “This not only violates the spirit of the Human Genome Project, it hinders the discovery of medical breakthroughs that could save lives. Our bill is a common sense measure to ensure that genes yet unpatented remain the province of science.”

The bill, H. R. 977, would amend title 35 of the U.S. Code, to prohibit the patenting of human genetic material. Chapter 10 of title 35 would be amended to at the end the following new section:

`Sec. 106. Prohibition on patent of human genetic material

`Notwithstanding any other provision of law, no patent may be obtained for a nucleotide sequence, or its functions or correlations, or the naturally occurring products it specifies.’.

(b) Table of Contents- The table of sections of chapter 10 of title 35, United States Code, is amended by adding at the end the following:

`106. Prohibition on patent of human genetic material.’.

(c) Applicability- The amendment made by subsection (a) shall not apply to a patent issued before the date of the enactment of this Act .

According to patent law, one who “invents or discovers any new and useful process, machine, manufacture, or any composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title.” To be patentable, an invention must be useful, novel, and nonobvious and once the USPTO issues a patent, the owner gets the right to exclude others from making, using, selling, offering to sell, or importing into the United States the patented invention.

Genes are just chemical compounds and, as such, they qualify as compositions of matter with respect to patent criteria. Although products of nature (a preexisting substance that is found in the wild) may not be patented, per se, the courts have determined that such a product of nature may be patentable if significant artificial changes are made. By purifying, isolating, or otherwise altering a naturally occurring product, an inventor may obtain a patent on the product in its altered form. Thus, “one cannot patent a naturally occurring gene or protein as it exists in the body, but one can patent a gene or protein that has been isolated from the body and is useful in that form as a pharmaceutical drug, screening assay or other application.”

It is, however, important to recognize that patent protection is what secures the economic payback that allows companies to invest in the research to develop new drugs from gene sequences even when the odds are high that it will fail. Without the limited exclusive rights of patents, much research would never occur.

Author Michael Crichton, apparently now an expert on patents and genomics, followed this with a NY Times Op Ed piece about how evil gene patents are used to “halt research, prevent medical testing and keep vital information from you and your doctor. ” He also contends that they raise costs exorbitantly claiming that “a test for breast cancer that could be done for $1,000 now costs $3,000.” No word on just where he pulled those numbers from or if he will be writing on how copyrights raise costs on his books.

More reasoned views can be found here and here.

Posted February 13th, 2007 by Stephen Albainy-Jenei in Biotech News, Current Affairs
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Sanofi-Aventis SA lost a U.S. patent challenge brought by generic drugmakers Amphastar Pharmaceuticals and Teva Pharmaceutical Industries Ltd. over Sanofi’s blockbuster anticoagulant drug, Lovenox. Lovenox is Sanofi’s best-selling drug, with sales over $2.79 billion in 2005 — even more than Plavix. Lovenox is an injectable drug used in protecting patients against deep vein thrombosis or blood clots that usually develop in the legs. If the clots break free, they can wind up in the lungs causing potentially fatal consequences.

In June 2005, District Court had granted Amphastar and Teva a motion for summary judgment that invalidated Sanofi-Aventis’ US Pat. No. 5,389,618 for Lovenox based on inequitable conduct concerns. In April 2006, a federal appeals court reversed the decision and sent the case back to the trial court. The major issue was whether Sanofi tried to mislead to the U.S. Patent and Trademark Office. The District Court retried the case in December. Amphastar Pharmaceuticals and Teva Pharmaceuticals were seeking approval from the FDA for purportedly generic versions of Lovenox® and were challenging the ‘618 listed in the Orange Book for Lovenox®.

Although the patent covering the Lovenox main ingredient (enoxaparin sodium) does not expire until February 14, 2012, a ruling by the U.S. District Court for the Central District of California has found inequitable conduct by Sanofi when it initially filed the patent. In the decision by Judge Mariana Pfaelzer, the court ruled that there was sufficient evidence that Aventis had withheld material information during prosecution of the ‘618 patent and its replacement, Reissue Pat. No. RE38,743.

The central issue involves Aventis’ representations that Example 6 in the patent “clearly demonstrated” a significantly longer plasma half-life for the low molecular weight heparin (LMWH) compound. At no time did Aventis or its employee, Dr. Andre Uzan, disclose at what dosage the half-life comparisons in Example 6 were made. It was later discovered that the Example compared a 60 mg dose versus a 40 mg dose of the earlier product.

The case for deceptive intent hinged on the credibility and scientific rationale of the testimony of Dr. Uzan. The burden of affirmatively proving intent to deceive fell on Amphastar and Teva and the Court found clear and convincing evidence of intent to deceive in finding that (1) the applicant knew the information; (2) the applicant knew or should have known the materiality of the information; and (3) the applicant did not provide a credible explanation for the withholding.  In fact, the Court opined that “Dr. Uzan’s explanation suffers from a total absence of indicia of credibility.” Ouch.

The Court ruled that but for Dr. Uzan’s intentional omissions, there was a high probability that the ‘618 patent would not have issued and the ‘618 patent must therefore be found unenforceable due to inequitable conduct.

If the ruling stands, Sanofi could see 60% of its Lovenox sales at risk to generic competition five years before the patent would have expired. However, the Food and Drug Administration hasn’t approved any generic versions yet. Also, some believe that Sanofi may avoid an immediate generic entry because Lovenox’s complex formula makes it difficult for other companies to copy. Generic-drug makers must prove their products are bioequivalent to brand-name drugs — meaning it must have the same strength and reach the desired target in the same way as a brand-name drug.

See the entire ruling here:  teva-v-sanofi.pdf

Posted February 12th, 2007 by Stephen Albainy-Jenei in IP Litigation
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