In 1984, Congress passed the Drug Price Competition and Patent Term Restoration Act, also referred to as the Hatch-Waxman Act, primarily to balance incentives for pharmaceutical firms to make the investment to develop new drug applications (NDAs) through limited patent term extension provisions based on regulatory market delays, with additional provisions for generic drug companies to file abbreviated new drug applications (ANDAs) to bring cheaper versions of drugs to market after patent expiration.
Section 271(e)(1) provides protection for competitors from pre-commercial sales infringement as long as their activities are reasonably related to the development and submission of data under a Federal Law.
By its language, however, 271(e)(1) is not limited to entities seeking to produce generic drugs, and could be invoked by any organization seeking to make, use, sell, or offer to sell a patented invention so long as the use is reasonably related to the development and submission of information for FDA approval.
Determining the extent of the safe harbor protection from patent infringement has been the source of so much legal debate for the last two decades because in the words of the Supreme Court in Eli Lilly v. Medtronic, the hastily drafted 1984 statute is simply not plainly comprehensible in anyones view.
It was initially understood that 271(e)(1) was implemented to balance the patent term extension provided to patentees for regulatory approval delays under 35 U.S.C. 156. Extensions under 156 can be obtained for new drugs for human use, new Class III medical devices, new food or color additives, new animal drugs, and new veterinary biological products.
The Federal Circuit extended the safe harbor protections of 271(e)(1) to Class I and/or Class II medical devices, stating that the language of 271(e)(1) makes no distinction among the different FDA classes of medical devices or drugs (Abtox v. Exitron).
The courts have since determined that the manufacture and the sale of devices to a hospital, which are then used to generate data for the FDA, are exempt from infringement. Additionally, continuing to sell patented devices to hospitals even after the submission of an application for pre-market approval falls under the 271(e)(1) exemption since a company may need further data to satisfy the FDA requirements.
Selling devices for further clinical trials after FDA approval has been obtained, however, would not fall under the safe harbor exemption since the information obtained would no longer be necessary to satisfy FDA requirements.
One lower court has held that the safe harbor statute reaches all the way up the chain to research that involves identifying analogs. In Bristol-Myers Squibb v. Rhone-Poulenc Rorer, the court for the Southern District of New York held that the safe harbor immunizes early-stage research to develop analogs.
The defendant was infringing the patents-in-suit, covering certain intermediates (taxane derivatives), to research and develop analogs of taxol. While the research group was identifying 23 analogs per week and conducting therapeutic screening tests, the Rhone court, however, simply held that the safe harbor applies to the intermediates.
On the other hand, the court for the Western District of Wisconsin held that the protection of 271(e)(1) does not extend to protect the use of a research tool not regulated by the FDA in Infigen v. ACT. Infigen was the assignee of patents claiming a process for activating bovine oocytes for use in cloning cattle and claiming a bovine embryo culture medium used to grow and develop bovine embryos.
Both Infigen and ACT were interested in the development of transgenic cattle that would produce a pharmaceutical drug in their milk, and the commercialization of such a drug would require FDA approval.
The court stated that the safe harbor exemption did not apply to the product or methods claimed by the Infigen patents since the patent claims were not eligible for FDA-based patent term extension under 156.
While the 156 distinction has been deemed moot by more recent holdings of a broader safe harbor exemption, the question now remains whether such activity is still reasonably related to submission of information to FDA, or is an infringement of a research tool patent.
Despite the Supreme Courts recent ruling in Merck v. Integra, there is still insufficient clarification of whether the use of a patented research tool to develop therapeutic agents regulated by FDA is protected by the safe harbor exemption. The Court specifically declined to address the topic in Merck.
Research tools were defined by the 1998 NIH Working Group on Research Tools as embracing the full range of resources that scientists use in the laboratory, including cell lines, monoclonal antibodies, reagents, animal models, growth factors, combinatorial chemistry libraries, drugs and drug targets, clones and cloning tools (such as PCR), methods, laboratory equipment and machines, databases, and computer software.
When the Federal Circuit applies the facts surrounding the preclinical drug discovery research conducted on behalf of Merck under the guidelines established by the Supreme Court in Merck v. Integra, observers hope for further clarification as to which patented research tools are eligible for the safe harbor protections from infringement liability.