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Licensees Obtaining Data from Other Licensees

Posted by Foley & Lardner on Posted in Life Sciences Agreements

When a drug candidate is licensed to different licensees in different territories, the ability of each licensee to obtain marketing approval for the product may depend on access to data generated by the other. While license agreements do not always address this issue, there are some terms that can be useful in this type of situation.

Case Study

Last year, a U.S. biotech company received a complete response letter from FDA for its experimental therapy. The results of two Phase III studies were submitted with the company’s New Drug Application (NDA).  Unfortunately, the primary endpoint was not met in one of the studies. The FDA advisory committee recommended approval, but in the end, FDA required additional clinical testing to approve the drug.

The twist here is that data from a Phase III study in Japan had showed that the drug was safe and effective, but patient-level data was not included in the U.S. NDA because that data was not available to the U.S. company. You see, the U.S. biotech company is a licensee of the experimental drug product, but Japan is not part of its territory.  Another licensee has Japanese rights and owns the results from the Phase III study conducted in Japan.

Would the patient-level data have been enough for FDA to approve the therapy?  Maybe not.

Can provisions be inlcuded in license agreements to provide a licensee with access to data generated by another licensee? Yes.

Sample Provisions

Following are sample provisions from two publicly-filed agreements, where a non-worldwide licensee negotiated for access to data generated by other licensees.

In the 2007 Collaboration Agreement between Amgen and Daiichi Sankyo for rights to commercialize denosumab in Japan, the parties agreed to the following terms with respect to sharing of regulatory filings and clinical data in each other’s territory:

4.8 Sharing of Regulatory Filings. Each of the Parties will disclose to the other a draft copy of any Regulatory Filing in the Territory in the original language no less than thirty (30) days prior to filing it with a Governmental Authority. Each Party will consider in good faith any comments made by the other Party with respect to such filings. Each Party shall, no less frequently than quarterly, and more often as reasonably requested by the other Party, provide to the other Party (in such format as reasonably requested) all material preclinical and clinical data arising out of or relating to Dmab in trials thereof in the Territory (and outside the Territory, for Amgen) (or such subset of such data as the Parties may agree). Each of the Parties shall maintain a database which contains all clinical trial data accumulated from all clinical trials of Dmab in the Territory (in a computer readable format reasonably requested by Amgen). Upon the request of either Party, the other Party shall provide a right of reference to any requested Regulatory Filings or Regulatory Approvals in the Territory, and Amgen shall provide the same such right of reference to Collaborator with respect to such Regulatory Filings and Regulatory Approvals outside the Territory, in each case as reasonably necessary for the requesting Party’s development or commercialization of Dmab as permitted hereunder (or, with respect to Amgen, manufacture of Dmab). Notwithstanding the foregoing, Amgen shall not be required to provide to Collaborator nor to allow Collaborator to access (but shall provide a right of reference as set forth in Section 4.15.3 (Amgen Cooperation) to the extent necessary) Amgen’s manufacturing information with respect to Dmab or any sections of any such Regulatory Filing related thereto and neither Party shall have an obligation to provide information relating to any product other than Dmab.

In another Daiichi Sankyo agreement, this one the 2008 License, Co-Development and Co-Commercialization Agreement with ArQule for rights to ArQule’s oncology candidate, ARQ 197, outside of Japan and certain other Asian countries, the parties included the following provision for sharing data among licensees:

3.10.3 Right of Access. Each Party shall provide the other Party with access to all clinical project plans and clinical data, results and information derived from or relating to all Clinical Trials conducted, and all Regulatory Filings prepared, with respect to Collaboration Compounds and/or Licensed Products (collectively, “Product-Related Data”) in English and at no additional cost or expense. Notwithstanding anything to the contrary in this Agreement, ARQULE (a) may use, and provide to its Third Party licensees and collaborators, such Product-Related Data; provided, that, (i) ARQULE shall only have the right to share such Product-Related Data to its Third Party collaborators and licensees that have granted ARQULE the reciprocal right to share with DS clinical data, results and information, and information derived from or related to Regulatory Filings controlled by such Third Party collaborators and licensees for use with Licensed Products under this Agreement and (ii) ARQULE shall, upon DS’s request, use Commercially Reasonable Efforts to coordinate a global clinical trial targeting both within the Territory and the Asian Territory involving its Third Party collaborators and DS; (b) may use such Product-Related Data for the performance of its obligations and exercise of its rights under this Agreement; and (c) shall have a right of access, a right of reference and a right to use and incorporate all such Product-Related Data in any Regulatory Filings and Drug Approval Applications it makes with respect to Licensed Products. The Parties shall cooperate so that such Product-Related Data is transferred to ARQULE as expeditiously as possible.

These may or may not be model provisions, but they are two real-world examples of terms that have been used to provide a licensee with rights to data generated by the licensor or other licensees.

Solving Utility Problems

Posted by Courtenay Brinckerhoff on Posted in Federal Circuit Decisions

The Federal Circuit decisions in Cancer Research Technology Ltd. v. Barr Labs., Inc. (Nov. 2010) and In Re ’318 Patent Infringement Litigation ("Janssen") (Sep. 2009) present an interesting contrast in utility issues. In Cancer Research, the USPTO raised utility rejections that the applicant eventually overcame and the patent was found to be enforceable, while in Janssen, the USPTO never raised the issue but both the district court and the Federal Circuit found the patent invalid for lack of utility. The Federal Circuit may address a similar situation again this week, when it hears oral arguments in Eli Lilly & Co. v. Actavis on Thursday.

The Janssen Case

The Janssen Patent & Prosecution History

The patent at issue in Janssen (U.S. 4,663,318) was directed to:

A method of treating Alzheimer’s disease and related dementias which comprises administering to a patient suffering from such a disease a therapeutically effective amount of galanthamine or a pharmaceutically-acceptable acid addition salt thereof.  

As characterized by the Federal Circuit:

The specification of the ’318 patent was just over one page in length, and, according to the courts, provided almost no basis for its stated conclusion that it was possible to administer "an effective Alzheimer’s disease cognitively-enhancing amount of galanthamine."

The specification cited prior art publications reporting the administration of galanthamine to humans or animals for other purposes with other effects, such as increasing plasma cortisol levels in humans, increasing short-term memory in dogs, and antagonizing scopolamine-induced amnesia in rats. But, the specification did not explain how these results supported the use of galanthamine to treat Alzheimer’s disease.

The USPTO rejected the claims for obviousness, but withdrew the rejection when the applicant explained that the subjects in the prior art studies were "normal," and so the "circumstances [of the prior art studies] [had] no relevance to Alzheimer’s disease." The applicant also stated:

[E]xperiments [are] underway using animal models which are expected to show that treatment with galanthamine does result in an improvement in the condition of those suffering from Alzheimer’s disease.

The USPTO granted the ’318 patent without asking for that data and, indeed, before the data were available.

The ’318 Patent Litigation

Janssen’s product received FDA approval in 2001. In 2005, a number of generic drug manufacturers filed Abbreviated New Drug Applications (ANDAs) with "Paragraph IV" certifications alleging that the ’318 patent was invalid.

The district court found that the patent was invalid for lack of enablement under 35 USC § 112 for failing to demonstrate a utility under 35 USC § 101. On appeal, the Federal Circuit summarized several principles of the utility requirement in the context of therapeutic methods:

  • patents claiming new methods of treatment typically are supported by test results
  • testing need not be conducted by the inventor
  • human trials are not required for a therapeutic invention to be patentable
  • results from animal tests or in vitro experiments can be sufficient

Because the ’318 patent had no data whatsoever "involving the use of galanthamine to treat Alzheimer’s-like conditions," the Federal Circuit affirmed the finding of invalidity.

The Brana Footnote

In In re Brana (Fed. Cir. 1995), the court held that data submitted during prosecution

can be used to substantiate any doubts as to the asserted utility [in the specification] since this pertains to the accuracy of a statement already in the specification. . . .  It does not render an insufficient disclosure enabling, but instead goes to prove that the disclosure was in fact enabling when filed (i.e., demonstrated utility).

 In a footnote that I find troubling, the Federal Circuit in Janssen distinguished Brana on two grounds:

(1) the finding in Brana did not depend on the post-filing date test results and
(2) in Brana the testing was submitted to the USPTO during prosecution.

But, in Brana the court did say that

Even if one skilled in the art would have reasonably questioned the asserted utility, i.e., even if the PTO met its initial burden thereby shifting the burden to the applicants to offer rebuttal evidence, applicants proffered sufficient evidence to convince one of skill in the art of the asserted utility. . . . Such evidence alone should have been sufficient to satisfy applicants’ burden.

Moreover, the Janssen opinion offers no rationale for drawing a line between data submitted to the USPTO during prosecution and data submitted to a court during litigation.

The Cancer Research Case 

The Cancer Research Patent & Prosecution History

The patent at issue in Cancer Research (U.S. 5,260,291) was directed to a class of tetrazine derivatives and therapeutic methods using them, including methods of treating cancer. The teachings relating to anti-cancer use are found in this paragraph:

The new tetrazine derivatives of general formula I possess valuable antineoplastic activity, for example against carcinomas, melanomas, sarcomas, lymphomas and leukaemias. They possess useful activity against glioma and mycosis fungoides. They have proved particularly active in mice at daily doses between 0.5 and 16 mg/kg animal body weight, administered intraperitoneally, against TLX5 (S) lymphomas according to the procedure of Gescher et al, Biochem. Pharmacol. (1981), 30, 89, and ADJ/PC6A and M5076 (reticulum cell sarcoma). Against leukaemia L1210, grafted intraperitoneally, intracerebrally and intravenously, and P388, according to the procedure described in "Methods of Development of New Anticancer Drugs" (NCI Monograph 45, March 1977, pages 147-149, National Cancer Institute, Bethesda, United States), the compounds were active both intraperitoneally and orally at doses of between 2.5 and 10 mg/kg animal body weight. Inhibition of both primary tumour and metastasis was obtained against the Lewis lung carcinoma by similar dosage regimes. Against the B16 melanoma and C38 tumour in mice (NCI Monograph 45, op cit.) the compounds were active intraperitoneally at doses of between 6.25 and 25 mg/kg animal body weight.

The examples relate to the synthesis of the compounds and pharmaceutical compositions.

The USPTO rejected the cancer treatment claims for lack of utility. (Indeed, back in those days—1983—the treatment of cancer was viewed as "per se" in-credible by the USPTO—you might as well have been claiming a perpetual motion machine or cold fusion method). The USPTO examiner indicated that the rejection could be overcome with human clinical data.

Instead of responding to the Office Action, the applicant abandoned the application in favor of a continuation application. That application eventually was rejected for lack of utility. Again, the applicant simply abandoned the application in favor of a continuation application. This cycle continued for eight more times (a near impossibility now with the 20-year term), until the final continuation application was filed in 1991.

By 1991, the applicant had obtained some favorable human clinical data (and some less favorable data), but it was never submitted to the USPTO.  Rather, in the 1991 continuation application the applicant challenged the utility rejection, citing the animal data in the specification and favorable case law on point. Eventually, the USPTO was convinced, and the patent was granted in 1993.

The Cancer Research Litigation

The patentee obtained FDA approval for a product within the scope of the patent (Temodar®) in August 1999, and obtained a 1,006 day Patent Term Extension under 35 USC § 156. In 2007, Barr filed an ANDA with a Paragraph IV certification alleging that the patent was unenforceable for prosecution laches and inequitable conduct.

Although the district court agreed with Barr, the Federal Circuit reversed on both counts.

On the laches issue, the Federal Circuit found that Barr could not prevail because it did not allege any prejudice due to the prosecution delays. (The court also noted that the facts here are not likely to be repeated in view of the 20-year term.)

On the inequitable conduct issue, the Federal Circuit found that the district court had erred by relying "solely on its finding of materiality to infer intent." Moreover, the Federal Circuit stated that while the publication of the clinical trial data at issue "does not foreclose a finding of deceptive intent," it "is inconsistent with finding that intent to deceive is the single most reasonable inference to draw from the evidence."

 The Eli Lilly Case

The Eli Lilly case relates to Lilly’s Straterra® product for ADHD. The patent at issue is U.S. 5,658,590 which claims:

A method of treating attention-deficit/hyperactivity disorder comprising administering to a patient in need of such treatment an effective amount of tomoxetine.

In addition to making assertions of usefulness and disclosing appropriate therapeutic doses, the specification states the following regarding tomoxetine’s activity:

Tomoxetine is a well-known drug, the chemical name of which is (R)-(-)-N-methyl-3-(2-methylphenoxy)-3-phenylpropylamine. It is regularly used as a salt, and salts are included in the term tomoxetine as used here. See, for example, Gehlert, et al., Neuroscience Letters 157, 203-06 (1993), for a discussion of the mechanism of tomoxetine’s activity as a norepinephrine reuptake inhibitor. Tomoxetine is quite active in that function, and moreover is substantially free of other central nervous system activities at the concentrations or doses at which it effectively inhibits norepinephrine reuptake. Thus, it is quite free of side effects and is properly considered to be a selective drug.

In the pending ANDA litigation, the claims were challenged for lack of enablement. The district court followed Janssen by finding that Eli Lilly could not rely on post-filing date evidence to support utility because it had not been submitted to the USPTO, but noted that unlike Janssen, Eli Lilly had explained how the prior art discussed in the specification would have been understood to support utility.  Thus, the court denied the motion for summary judgment of invalidity.

As noted above, the Federal Circuit is scheduled to hear oral arguments in this case on Thursday, December 9, 2010.

Solving Utility Problems

I am troubled by the doctrine that seems to be sprouting from these cases:

An applicant can solve a utility problem—overcome a utility/enablement rejection—with post filing-date evidence as long as the problem is raised by the USPTO examiner, but a patentee cannot solve the same problem with the same evidence if its not raised until litigation.

Because this "doctrine" stems from a mere footnote in Janssen that provides no supporting rationale, I am at a loss as to where it comes from and why the court finds the need to draw this line.

Given the ever-evolving nature of patent law—where thresholds, standards and burdens can change with each Federal Circuit or Supreme Court decision—there is always a possibility that a patent that satisfied the law as it was understood, interpreted and applied at the time of prosecution may require additional evidence to establish that it satisfies a higher (or different) threshold, standard, or burden that may apply when it is challenged years later. Why should the patentee be limited to evidence made of record at the USPTO when the USPTO had no reason to require more evidence at the time and the applicant had no reason to believe that more was warranted? 

Maybe the Federal Circuit will take a closer look at this "doctrine" in the Eli Lilly case. If if doesn’t reconsider it or rein it in, I hope it will at least explain it.

Is Pre-Appeal Brief Review Worth The Effort?

Posted by Courtenay Brinckerhoff on Posted in Patent Office Practice

The USPTO provided outcome statistics from the Pre-Appeal Brief Review program in the notice of proposed rulemaking for the proposed changes to ex parte appeal practice before the USPTO Board of Patent Appeals and Interferences. The data reveal mixed results, but are encouraging enough to justify the relatively low costs of the program.

The Pre-Appeal Brief Review Program

The Pre-Appeal Brief Review program was started as a pilot program in 2005. The program permits an applicant to obtain panel review of appealed rejections before an Appeal Brief is filed. The panel is made up of three examiners, including the examiner of record on the application.

According to the USPTO, an applicant should consider using the program "[i]f the applicant feels the rejections of record are clearly not proper and are without basis, . . . based upon a clear legal or factual deficiency in the rejections rather than an interpretation of the claims or prior art teachings."

A Request for Pre-Appeal Brief Review must be filed with the Notice of Appeal, and can include up to five pages of arguments against the rejections. No additional fee is required for this program. Thus, the costs of participating in the program are minimal, relating to the costs of preparing the brief summary of arguments.

The panel can reach one of four decisions:

  1. The application remains under appeal because there is at least one actual issue for appeal.
  2. Prosecution on the merits is reopened and an appropriate Office communication will follow in due course. In appropriate circumstances, a proposed amendment may accompany the panel’s decision proposing changes that, if accepted, may result in an indication of allowability for the contested claim(s).
  3. The application is allowed on the existing claims and prosecution remains closed.
  4. The request fails to comply with the submission requirements and is dismissed.

If the panel decides that the application should proceed to appeal on any rejection, the panel decision will not indicate whether it agreed with the applicant on any other issue. Thus, such a decision does not give the applicant any insight into the panel’s view of the strength of the applicant’s position on any individual rejections.

For applications that proceed to appeal, the Appeal Brief is due two months from the filing date of the Notice of Appeal or one month from the panel decision, whichever is later.

Appeal Conferences

Appeal conferences are held in every appeal after a compliant Appeal Brief is filed, unless the examiner decides that the appeal should not proceed and a supervisory patent examiner (SPE) agrees.

The panel makeup for an appeal conference is similar to that for Pre-Appeal Brief Review, and includes the examiner of record, a SPE, and another examiner. The panel considers whether any or all of the rejections should be maintained.

The Examiner’s Answer reflects the outcome of the appeal conference, and may indicate that one or more rejections have been overcome. Alternatively, prosecution may be reopened or the application may be allowed.

The Statistics

In promulgating the new proposed appeal rules, the USPTO addressed the comments received in response to the December 22, 2009 Advance Notice of Proposed Rulemaking (ANPRM) relating to ex parte appeal practice. One comment requested statistics on the Pre-Appeal Brief program. The USPTO provided data for each full fiscal year (FY) since the program was launched, and also provided statistics from Appeal Conferences. The following chart (taken from the Federal Register notice) shows:

  1. The annual number of such requests.
  2. The percent of notices of appeal that contain a request
  3. The outcomes of the conferences
  4.  A comparison of the outcomes of the Pre-Appeal Brief Conference to the Appeal Conference.

If an applicant files a Request for Pre-Appeal Brief Review in the hopes of having all rejections reversed, he is likely to be disappointed, as only 2-5% of Requests have that positive outcome.

On the other hand, nearly 40% of Requests result in prosecution being reopened, which suggests that at least some rejections are overcome or modified.

Still, slightly more than 50% of all Requests result in a determination that the appeal should proceed.

It is interesting to see that the percent of appeals in which Requests for Pre-Appeal Brief Review are filed has slowly but steadily increased each year. Still, usage is low (at about 33%), given the low costs of the program. This could be due to the complexities of the issues on appeal, a belief that the panel makeup is stacked against the applicant, the lack of information provided when the panel decides that the appeal should proceed, or a desire to expedite the appeal process.

Appeal Conferences are three times more likely to result in all rejections being reversed (15%). This is not surprising given that the Appeal Brief is likely to present the applicant’s position more thoroughly and with citations to legal authority, while a Request for Pre-Appeal Brief Review is limited to five pages of arguments regardless of the number of issues on appeal.

What is more concerning is the steady drop in the Appeal Conference reversal rate since 2002, with the current reversal rate being less than half that of the 2002 rate (34%). This could be due to stronger rejections, but recent statistics from the Board still show about a 30% reversal rate, with a further 14.5% of cases being reversed-in-part.

Why Bother?

If barely 5% of Requests for Pre-Appeal Brief Review result in the rejections being reversed, why should an applicant participate in the program? Looking at the statistics from a different perspective, they indicate that in 44% of the cases prosecution is advanced in some way, with prosecution being reopened even if not all rejections are reversed. Given the inexpensive and simple procedures of the program, even a low success rate can be worth the costs.