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Nelson Mullins COVID-19 Resources

Nelson Mullins is continuing to monitor developments related to COVID-19, including guidance from the Centers for Disease Control and various federal, state, and local government authorities. The firm is taking appropriate precautionary actions and has implemented plans to ensure the continuation of all firm services to clients from both in office and remote work arrangements across our 25 offices. 

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Nelson Mullins COVID-19 Resources

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Bostock v. Clayton County and Implications for Title VII Litigation

July 6, 2020

Bostock v. Clayton County and Implications for Title VII Litigation
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Additional Nelson Mullins Alerts

January 7, 2020

A Different Analysis for Manufacturing Method Patents under the 35 U.S.C. § 271 (e)(1) Safe Harbor Provision?

By Siew Yen Chong, Amy Mandragouras

On December 16, 2019, the Federal Circuit affirmed a Delaware jury verdict finding that Hospira infringed Amgen’s method of manufacturing patent on erythropoietin (EPO) and that Amgen was entitled to $70 million in damages because most of the drug substance batches that Hospira made during the pre-approval period were not exempt under the Safe Harbor provision.  The case arises from Hospira's December 2014 submission of a Biologics License Application (BLA) to the FDA for approval to market a biosimilar to Amgen’s EPO product, Epogen.

Amgen sued Hospira at the Delaware District Court in September 2015 for infringement of U.S. Patent No. 5,856,298 (the ’298 patent) under 35 U.S.C. §§ 271 (a) and 271 (e)(2)(C), and for infringement of U.S. Patent No. 5,756,349 (the ’349 patent) under U.S.C. §§ 271 (a).  A jury trial was held in September 2017.  At the time of the jury trial, Hospira's BLA had not obtained FDA approval even though Hospira had been marketing a biosimilar of Epogen in Europe since 2007 and had expected to receive FDA approval in 2015.  Instead, the FDA issued a Complete Response Letter (CRL) rejecting Hospira’s BLA in October 2015.  Hospira did not receive its BLA approval until May 2018. 

The jury returned a verdict that both patents were valid and that Hospira infringed claims 24 and 27 in the ’298 patent but did not infringe any of the asserted claims in the ’349 patent.  The jury additionally found that Hospira was only entitled to Safe Harbor defense for only seven of the twenty-one batches of infringing EPO drug substance that Hospira had made and awarded $70 million in damages to Amgen.  Both Hospira and Amgen moved for Judgment as a Matter of Law but were denied by the district court.  Both parties appealed to the Federal Circuit. 

Claim 27 of the ’298 patent recites

A method for obtaining an erythropoietin composition having a predetermined in vivo specific activity comprising preparing a mixture of two or more erythropoietin isoforms of claim 1.

Claim 1 recites:

An isolated biologically active erythropoietin isoform having a single isoelectric point and having a specific number of sialic acids per molecule, said number selected from the group consisting of 1-14, and said isoform being the product of the expression of an exogenous DNA sequence in a non-human eukaryotic host cell. 

Hospira challenged both the district court’s jury instruction on the Safe Harbor provision, as well as the jury’s finding that only a subset of Hospira’s accused EPO batches were entitled to Safe Harbor protection.  The 35 U.S.C. § 271 (e)(1) Safe Harbor provision states that “[i]t shall not be an act of infringement to make, use, offer to sell or sell within the United States or import into the United States a patented invention... solely for uses reasonably related to the development and submission of information under a Federal which regulates the manufacture, use, or sale of drugs or veterinary biological products.”  (emphasis added.)

Hospira argued that the final sentence of the jury instruction on Safe Harbor “improperly” focused on why each EPO batch was manufactured, instead of how each batch was used.  Hospira contended that it only needed to show that the use of the drug substance was reasonably related to the submission of information to the FDA to avail itself of the Safe Harbor protection.  The last sentence of the jury instruction stated that "if 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."  (emphasis added.)

Amgen responded that the infringed claims were directed to methods of making the EPO drug substances.  Thus, the inquiry correctly focused on Hospira's use of the claimed method, i.e., the manufacture of the drug substance.  And the jury was rightly asked to evaluate whether each act of manufacture was reasonably related to seeking FDA approval.  The Federal Circuit panel agreed and held that the jury instruction struck the right balance by telling the jury that any additional underlying purpose that Hospira had for manufacturing the drug substance does not matter, as long as Hospira can prove that the production was reasonably related to developing information for submission to FDA to obtain regulatory approval.

Hospira argued that all twenty-one accused drug substances batches manufactured in 2013, 2014, and 2015 were used for the development of information for submission to the FDA, either in the BLA filing or in response to the issued CRL and should have been protected under the Safe Harbor provision.  The Federal Circuit disagreed, finding that Hospira's witnesses testified that some of the tests were not required for FDA approval and no batches were made in response to the FDA's CRL, as the CRL did not require the manufacture of additional batches.

Hospira also objected to the inclusion of evidence that Hospira planned to use some of the batches as commercial inventory but later re-designated the batches from commercial inventory to continued process verification (CPV, an ongoing process for batches made for commercial use).  Although the Federal Circuit agreed that Hospira's manufacture of commercial inventory was not dispositive of the Safe Harbor defense but stated that the information was still probative of whether the use of the patented process was reasonably related to seeking FDA approval.  The panel affirmed the jury's finding that the Safe Harbor provision did not protect the fourteen accused batches.

This Federal Circuit decision expanded the ability of patent owners to collect damages on pre-approval manufacture of drug substances using patented manufacturing methods by focusing on the manufacture and not the subsequent use of the accused drug substance batches in evaluating whether an accused activity was "solely for uses reasonably related to the development and submission of information under a Federal law."  For patent owners seeking to enforce their patent portfolio against competitors, this decision reinforces the value of process or method of manufacturing patents, which are often overlooked or considered secondary to compound and formulation patents. 

Considering the difficulty in obtaining approval for biosimilar products, it behooves biosimilar manufacturers to evaluate their pre-approval manufacturing strategy, such as timing, batch quantity, designating batches, and designing around (alternative manufacturing methods were ostensibly available, as the record shows that Amgen itself did not use the methods covered by the ’298 patent in manufacturing its EPO), when planning production of drug substance covered by manufacturing patents with remaining patent terms.