Obviousness-Type Double Patenting Does Not Invalidate Patent Term Extensions
In Novartis AG v. EZRA Ventures LLC, No. 2017-2284 (Fed. Cir. Dec. 7, 2018), the U.S. Court of Appeals for the Federal Circuit affirms the Delaware district court’s final judgment concerning patent term extensions and the interplay with the obviousness-type double patenting doctrine. In this court decision, the Federal Circuit found that in accordance with statutory construction principles and the court’s holding in Merck & Co. v. Hi-Tech Pharmacal Co., 482 F.3d 1317 (Fed. Cir. 2007), the obviousness-type double patenting doctrine and the court’s holding does not invalidate an otherwise validly obtained patent term extension under § 156.
Obviousness-type double patenting is a “judicially created doctrine” that is intended to prevent extension of a patent beyond a “statutory time limit.” In re Berg, 140 F.3d 1428, 1431–32 (Fed. Cir. 1998). Prior to the Uruguay Round Agreements Act of 1994 (URAA), which changed the term for a U.S. patent from seventeen years from patent issuance to twenty years from the earliest (non-provisional) filing date, patent applicants could theoretically extend their patent term without end. For example, a series of patent applications could be filed that cover the same or similar subject matter with slight obvious modifications of an invention. Further, applicants could hypothetically orchestrate longer patent-exclusivity periods by claiming different priority dates in each patent application, and then strategically delaying prosecution.
In a recent precedential opinion by the U.S. Court of Appeals for the Federal Circuit (hereinafter “Federal Circuit”), the Federal Circuit reviewed the obviousness-type double patenting doctrine with respect to patent term extensions under the Hatch-Waxman Act. In Novartis AG v. EZRA Ventures LLC, No. 2017-2284 (Fed. Cir. Dec. 7, 2018) (hereinafter “Novartis”), the Federal Circuit found that in accordance with statutory construction principles and the court’s holding in Merck & Co. v. Hi-Tech Pharmacal Co., 482 F.3d 1317 (Fed. Cir. 2007) (hereinafter “Merck”), the obviousness-type double patenting doctrine and the previous court’s holding does not invalidate an otherwise validly obtained patent term extension (hereinafter “PTE”) under § 156.
Turning to the factual and legal issues in the Novartis decision, Ezra Ventures filed an Abbreviated New Drug Application (ANDA) for a generic version of Novartis’s branded multiple sclerosis drug, Gilenya®. Novartis sued for infringement, asserting the ’229 patent. Because the ’229 patent was filed before the URAA, its patent term was 17 years. It was set to expire in 2014. However, Novartis secured a patent term extension (PTE) of five years under 35 U.S.C. § 156. Section 156 was enacted to restore the value of the patent term that an owner loses during the early years of the patent because the product cannot be commercially marketed without regulatory, e.g., FDA, approval. Section 156 allows a term extension of up to five years, equal to the regulatory review period, on a patent covering a product subject to regulatory review. See 35 U.S.C. §§ 156(a), (c), (g)(6). Multiple patents by the same owner may cover the same product that has been subject to regulatory review, but only one patent’s term can be extended. The patent owner makes a choice among its qualifying patents. See 35 U.S.C. § 156(c)(4). Novartis also owned the ’565 patent covering Gilenya® and sought PTE on the ’229 patent, which now expires in February 2019. Because the ’565 patent issued from an application filed after the URAA, its 20-year term expired in 2017. The district court denied Ezra Ventures’ motion for judgment on the pleadings, where Ezra Ventures argued that the extension of the ’229 patent’s term beyond the life of the ’565 patent de facto extended the life of the ’565 patent and rendered the ’229 patent invalid for double patenting. The district court found the ’229 patent valid, unexpired, enforceable, infringed, and enjoined Ezra Venture’s ANDA product until the 2019 expiration.
On appeal, the Federal Circuit agreed with the district court that Novartis’s selection of its ’229 patent for term extension does not violate § 156(c)(4). The Federal Circuit concluded that Congress chose not to limit the availability of a PTE to a specific patent and instead chose “a flexible approach which gave the patentee the choice.” Novartis at 1323. Further, as long as the requirements for a patent term extension recited in § 156(a) are met, the Director of the Patent and Trademark Office “shall” grant a PTE on the patent of patentee’s choice. See 35 U.S.C. § 156(e)(1).
In addition, the Federal Circuit noted the contrast between § 156 for PTE with the language of § 154 for patent term adjustments. In particular, the court found § 154 “expressly excludes patents in which a terminal disclaimer was filed from the benefit of a term adjustment for PTO delays,” but § 156 contains “no similar provision that excludes patents in which a terminal disclaimer was filed from the benefits of Hatch-Waxman extensions.” Novartis at 1322. Thus, the Federal Circuit concluded that “[t]he express prohibition against a term adjustment regarding PTO delays [under § 154(b)], the absence of any such prohibition regarding Hatch-Waxman extensions, and the mandate in § 156 that the patent term shall be extended if the requirements enumerated in that section are met, support the conclusion that a patent term extension under § 156 is not foreclosed by a terminal disclaimer.” Id.
Further, the Federal Circuit found that this case did not raise the traditional concern with obviousness-type double patenting of a patent owner “extending his exclusive rights to an invention through claims in a later-filed patent that are not patentably distinct from claims in the earlier filed patent.” Here, it was the earlier-filed, earlier-issued patent that has the later expiration date, due to a statutorily-allowed term extension under § 156, not the later-filed, later-issued patent. As such, a PTE pursuant to § 156 is valid so long as the extended patent is otherwise valid without the extension.
Accordingly, by applying statutory construction principles, following the court’s precedent in Merck, and addressing traditional obviousness-type double patenting principles, the Federal Circuit affirmed the district court’s final judgment that obviousness-type double patenting does not invalidate a validly obtained PTE.
In conclusion, patent applicants, patentees, and patent challengers must remember that this Federal Circuit holding applies to patent term extensions and not patent term adjustment (hereinafter “PTA”). In general, a PTA is added onto the original expiration date based on USPTO delays in prosecuting an application. While the Novartis decision was focused on PTE under § 156, obviousness-type double patenting is still very relevant for applications with PTAs. If PTA extends a patent’s life beyond the term of another patent with patentably indistinct claims, obviousness-type double patenting will eliminate the additional term created by PTA. Therefore, it remains good practice to be strategic about filing continuation applications and applications with similar inventions to avoid possibly shortening the patent term for a valuable patent.