Opinion
95 Civ. 8833 (RPP)
November 27, 2001
Counsel for Plaintiff: Thomas H. Beck, Esq., Fitzpatrick, Cella, Harper Scinto, New York, N.Y. 10112-3801
Counsel for Defendants: Philip E. Roux, Esq., Clifford Chance Rogers Wells LLP, New York, N.Y. 10166-0153
Gaynell C. Methvin, Esq., Dallas, TX 75201
OPINION AND ORDER
Rhone-Poulenc Rorer, Inc., Centre National De La Recherche Scientifique, and Rhone-Poulenc Rorer, S.A. (collectively, "RPR") have filed a motion for partial summary judgment of infringement pursuant to 35 U.S.C. § 271(a) based upon Bristol-Myers Squibb Company's ("Bristol") use of intermediates patented under RPR's U.S. Patent Re. No. 34,277 (June 8, 1993) ("the `277 patent"), not in the commercial marketplace, but in Bristol's research and development program. Bristol has filed a cross motion for summary judgment of non-infringement claiming that its use of RPR's patented intermediates in its research and development program was non-infringing use pursuant to 35 U.S.C. § 271(e)(1). Due to the Court's impending major surgery, the matter was referred to a Special Master to hear and report. The Special Master has issued a Report and Recommendation dated July 23, 2001 (the "Report"). Both parties have served objections to this Report.
Standard of Review
The Court's review and consideration of the parties' briefs, exhibits, declarations, statements of material facts pursuant to Local Rule 56.1, relevant authorities, the Special Master's Report, the objections thereto, responsive papers, reply papers, and further filings by the parties is de novo.
Factual Background
The following facts are undisputed:
The Court's review of the parties' Local Rule 56.1 Statements reveals, as it did on the previous motion under Section 271(f), that, instead of providing the Court with evidence in the form of quotes from documents and affidavits and excerpts from depositions, counsel engage in lawyer's arguments and unacceptable practices, e.g., inaccurate citations to the evidence, adding lawyer's conclusions or unsupported facts to the facts cited, and making lengthy legal arguments. This Court has commented previously as to the attorneys' failure to comply with Rule 56.1 and the consequent burdens it places on the Court by emasculating the function for which the rule was designed.
1. RPR's `277 patent discloses and claims semi-synthetic processes for preparing the drug taxol ("paclitaxel") and four intermediates (taxane derivatives) obtained during and used in process claim 1. (Declaration of Joel N. Bock, sworn to February 28, 2001 ("Bock Decl."), Ex. 1 at ¶ 1.) Three of those intermediates, claims 12, 13, and 14, are the subject of this motion.
Although RPR also claims that Bristol has infringed the process claims of the `277 patent, those claims are not the subject of this motion.
2. The intermediates of claims 12, 13 and 14 are chemical compounds formed from the combination of certain molecules, and are used to make other intermediates or end products in the processes claimed by RPR.
3. Documents and testimony show that Bristol has "used" the intermediates claimed in claims 12, 13 and 14 of the `277 patent in experiments during its research and development activities regarding taxol (paclitaxel) analogs. (Bock Decl., Ex. 27; Bristol's Supplemental Responses to RPR Interrogatories ("Bristol's Supp. Resp.") at 16-18.)
Applicable Statutes 35 U.S.C. § 271 (1994) states, in relevant part:
(a) Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor infringes the patent . . . .
(e)(i) It shall not be an act of infringement to make, use, offer to sell or sell within the United States a patented invention . . . solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use or sale of drugs . . . .Analysis
Bristol and RPR agree that Section 271(e)(1) acts as an exception to the broad reach of Section 271(a). The parties disagree, however, on the applicability of Section 271(e)(1) to Bristol's activities. Bristol claims that its use of RPR's patented intermediates falls within the scope of Section 271(e)(1) because its use of the patented intermediates in taxane research was "solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use or sale of drugs." ( 35 U.S.C. § 271(e)(1).) RPR claims that Bristol's use of the patented intermediates is outside the scope of Section 271(e)(1) because 1) the intermediates are not a "patented invention" within the meaning of that term in Section 271(e)(1) and 2) Bristol's uses were not "reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use or sale of drugs." (id.)
"Patented Invention"
Section 271(e)(1) applies to "a patented invention." RPR argues that because 35 U.S.C. § 156 and 271(e) were both part of the Drug Price Competition and Patent Term Restoration Act of 1984, Congress intended the two sections to be construed in a complementary fashion such that only products that are covered under Section 156 should be considered "patented inventions" within the scope of Section 271(e)(1). (RPR Mem. in Supp. ("RPR Mem. in Supp.") dated Feb. 28, 2001 at 14.) Because RPR's patented intermediates are not products covered under Section 156, RPR contends that Section 271(e)(1) does not apply to Bristol's use of those intermediates.
Section 156 extends the patent terms of drug products, medical devices, food additives, and color additives whose entry into the commercial marketplace is subject to lengthy delays due to the necessity of regulatory review under the Federal Food, Drug, and Cosmetic Act. ( 35 U.S.C. § 156(a), (f).)
Nothing in the text of Section 271(e)(1) indicates that Congress intended to restrict the scope of the term "patented invention" to those products covered by Section 156. As the U.S. Supreme Court noted,
The term patented invention in 271(e)(1) is defined to include all inventions, not drug-related inventions alone. See 35 U.S.C. § 100(a) (when used in this title unless the context otherwise indicates . . . the term "invention" means invention or discovery.)Eli Lilly v. Medtronics, 496 U.S. 661, 665 (1990). Additionally, absent clear Congressional intent to the contrary, the term "patented invention" should be interpreted consistently with other subsections of Section 271; i.e., Section 271(a), where it applies to all patented inventions, and Section 271(f), where RPR has successfully argued that the term applies to all patented inventions.
Bristol had previously argued that Section 271(f) did not apply to chemical patents. RPR successfully took the position that the term "patented invention" applies to inventions of all types. (Opinion and Order dated Oct. 18, 2001.)
Furthermore, two decisions of the Federal Circuit have interpreted Section 271(e)(1) as applying to the use of allegedly infringing products not within the scope of Section 156. In Abtox, Inc. v. Exitron Corp., 122 F.3d 1019, 1028 (Fed. Cir. 1997), amended by 131 F.3d 1009 (Fed. Cir. 1997), the patent owner argued that the Section 271(e)(1) exemption was not available because the allegedly infringing plasma sterilizer for medical instruments was a class II medical device which may be marketed without advance approval (and hence was not a product covered by Section 156). The Federal Circuit rejected this argument, noting that the U.S. Supreme Court had "explicitly accepted a statutory interpretation `in which a patentee will obtain the advantage of the [section 156] extension but not suffer the disadvantage of the [section 271(e)(1)] noninfringement provision, and others in which he will suffer the disadvantage without the benefit.'" (Abtox, 122 F.3d at 1029 (quoting Eli Lilly, 496 U.S. at 671-72).) The Federal Circuit held that the Section 271(e)(1) exemption for testing a patented device applied even though the alleged infringing Class II device was not eligible for patent extension under Section 156. Id. at 1028.
In Chartex Int'l PLE v. M.D. Pers. Prod. Corp., 5 F.3d 1505 (Fed. Cir. 1993), the patent owner alleged that the defendant's female condom, which was either a Class I or II medical device, was not within the scope of Section 271(e)(1) because neither a Class I nor Class II device is eligible for a patent extension under Section 156. The Court rejected this argument, stating that:
Chartex would read limitations that may apply to 35 U.S.C. § 155 and 156 (1988) into Section 271(e)(1). Sections 155 and 156, however, deal with term extensions for patents relating to products subject to lengthy delays. Although section 156 and section 271(e)(1) of title 35 passed as sections 201 and 202 of the Drug Price Competition and Patent Term Restoration Act of 1984, this Court declines to read possible limitations from one section into another.
(Id. at n. 2 (internal citation omitted).)
Abtox and Chartex are clear Federal Circuit precedent that the term "patented invention" means all patented inventions or discoveries, and not merely those that are covered by Section 156. Accordingly, the Court applies the term "patented inventions" in accordance with its plain meaning and rejects RPR's argument that the patented intermediates of the `277 patent are not "patented invention[s]" under Section 271(e)(1). Having determined that the patented intermediates come within the meaning of Section 271(e)(1), the Court proceeds to determine the other issue: whether Bristol's use of RPR's intermediates was "solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs. . . ." ( 35 U.S.C. § 271(e)(1).)
RPR's reliance on Ifigen Inc. v. Advanced Cell Technology, Inc., 65 F. Supp.2d 967 (W.D. Wis. 1999) is misplaced as not in accordance with the broader reading of Section 271(e)(1) by the Federal Circuit in Abtox and Chartex. It is noteworthy that in reaching its narrow reading of Section 271(e)(1), the Ifigen court evidently misread the Abtox decision. (Id. at 980.)
RPR cites the legislative history of Section 271(e)(1) for the proposition that "the only activity which will be permitted by [§ 271(e)(1)] is a limited amount of testing so that generic manufacturers can establish the bioequivalency of a generic substitute." (RPR's Mem. in Supp. at 16 (quoting 1984 U.S.C.C.A.N. at 2692).) This statement notwithstanding, the Court finds that the legislative history contains contrary indicia and, in any event, is insufficient to outweigh the plain language of Section 271(e)(1).
The Court notes that the statement cited by RPR was made by the Committee of the Judiciary in response to a failed amendment, offered by of one of its members, Mr. Moorhead. Mr. Moorhead recognized that the language of Section 271(e)(1) was so broad that it would apply to all drug patents, not merely those that are covered under Section 156, and would only disallow commercial use of a patent. (1984 U.S.C.C.A.N. at 2719-20.) Despite the broad scope of the language used in Section 271(e)(1) having been expressly brought to the attention of members of Congress, no attempt was made to refine or narrow the language used in the text of Section 271(e)(1).
In addition, the Court recognizes that one of Congress' stated purposes in enacting the 1984 Amendments was to encourage innovation and allow new drug products to be brought to market in a quicker fashion while upholding patent rights. All drug products are subject to regulatory delay. In balancing the need to allow new drug products to be brought to market in quicker fashion with the need to uphold the rights of patent owners, the House Committee on Energy and Commerce stated:
Section 271(e)(1) provides that it shall not be an act of infringement to make, use or sell a patented invention solely for uses reasonably related to the development and submission of information under a federal law which regulates the approval of drugs. This section does not permit the commercial sale of a patented drug by the party using the drug to develop such information, but it does permit the commercial sale of research quantities of active ingredients to such party. The information which can be developed under this provision is the type which is required to obtain approval of the drug. A party which develops such information, but decides not to submit an application for approval, is protected as long as the development was done to determine whether or not an application for approval would be sought.
1984 U.S.C.C.A.N. at 2678. This balance is reiterated in a footnote to the Report stating, "The situation presented in H.R. 3605 does not result in the total extinguishment of the patent owner rights, because the patent owner still maintains a right to exclude others from the commercial marketplace." (1984 U.S.C.C.A.N. 2714, fn. 19.) These sections indicate that the House Committee on Energy and Commerce believed that Section 271(e)(1) struck an appropriate balance by prohibiting competitors using the patented invention to develop such information from entering the commercial market until expiration of patent rights.
Lastly, members of the Supreme Court have cautioned against relying too heavily on the stated views of a small number of the members of Congress. See, e.g., Crosby v. National Foreign Trade Council, 530 U.S. 363, 390-91 (2000) (Scalia, J., concurring) ("The only reliable indication of [what a majority of both Houses of Congress intended when they voted for the statute before us] — the only thing we know for sure can be attributed to all of them — is the words of the bill that they voted to make law.")
"Solely for Uses Reasonably Related to the Development and Submission of Information Under a Federal Law which Regulates the Manufacture, Use, or Sale of Drugs or Veterinary Biological Products"
Both parties agree that the District Court's decision in Intermedics, Inc. v. Ventritex, Inc., 775 F. Supp. 1269 (N.D. Cal. 1991), aff'd 991 F.2d 808 (Fed. Cir. 1993), sets forth the controlling legal standard concerning the exemption under 35 U.S.C. § 271(e)(1). (Bristol's Objs. to the Special Master's Report dated Aug. 21, 2001 ("Bristol's Objs.") at 6-8; RPR's Resp. to Bristol's Objs. dated September 4, 2001 ("RPR Resp.") at 1.)
The Special Master's Report had recommended that the Court address this issue by requiring Bristol to "prove that its uses of patented intermediates follow standard industry practices for (1) the preparation of potential drug products from intermediates; (2) screening and testing of such products; (3) evaluation of such tested products for further testing, and/or submission of applications to the FDA for IND or NDA." (Report at 9-10.) Both parties object to the Report insofar as it suggests adopting a "standard industry practice test" to determine whether Bristol's use of the intermediates of claims 12, 13 and 14 are reasonably related to an FDA submission. (RPR's Response to Bristol's Objections (RPR's Response) at 1, 7; Bristol's Objections at 1, 4.) The Court declines to follow the Special Master's recommendation as not supported by legal precedent and impractical in a case which is now six years old and ready for trial.
In Intermedics, 775 F. Supp. at 1280, the Court stated:
We infer that the phrase "reasonably related" (to development of information for the FDA) as used in § 271(e)(1) reflects Congress' acknowledgment that it will not always be clear to parties setting out to seek FDA approval for their new product exactly what kinds of information, and in what quantities, it will take to win that agency's approval. Thus, Congress used this phrase to communicate its intention that the courts give parties some latitude in making judgments about the nature and extent of the otherwise infringing activities they would engage in as they sought to develop information to satisfy the FDA. Contrary to the suggestion seemingly made by plaintiff, we do not believe that Congress intended a party to lose the exemption simply because it turns out, after the fact, that some of that party's otherwise infringing "uses" either failed to generate information in which the FDA was interested or generated more information than turned out to be necessary to secure FDA approval. Instead, with respect to this aspect of the test, we should ask: would it have been reasonable, objectively, for a party in defendant's situation to believe that there was a decent prospect that the "use" in question would contribute (relatively directly) to the generation of kinds of information that was likely to be relevant, in the process by which the FDA would decide whether to approve the product?
Applying the Intermedics test to this case is made difficult by the parties' failure to comply with Rule 56.1 as previously discussed in footnote one. Nevertheless, the Court's review of certain admissions, undisputed facts, and uncontradicted testimony leads it to conclude that a rational jury could only determine that Bristol's experiments using the patented intermediates were reasonably related to the submission of information to the FDA.
After consideration of Bristol's Local Rule 56.1 Statement and RPR's Counter Rule 56.1 Statement, the Special Master recommended that Bristol's cross-motion for summary judgment be denied. In view of their failure to comply with Local Rule 56.1, the Court has chosen to disregard Bristol's Local Rule 56.1 Statement and RPR's Counter Statement. Instead, the Court has focused on RPR's admissions in its motion for summary judgment and in this cross motion, and on uncontradicted testimony submitted by both parties on Bristol's cross motion. On review of these materials, the Court concludes that Bristol's cross-motion should be granted.
Most of the relevant facts supporting the Court's determination are found in admissions by RPR. RPR acknowledges that "Bristol embarked on a taxane research and development program in an attempt to discover a new, more active drug that could replace taxol as the preeminent anti-cancer drug as soon as Bristol's exclusive right to market taxol expired" and that, "[a]s a starting point for its research and development activities Bristol has used various intermediates, including the intermediates claimed by RPR in claims 12 through 14 of the `277 patent." (RPR Mem. in Supp. at 7). More specifically, RPR states that Bristol used RPR's patented intermediates to run "hundreds of experiments for purposes of possibly identifying a drug candidate" in its Drug Discovery Department. (RPR's Resp. at 4.) RPR expounded on Bristol's use of RPR's patented intermediates in its Statement of Undisputed Material Facts Relevant to Bristol's Cross Motion dated May 1, 2001:
(1) Each of the infringing acts were done by Bristol scientists working in the Anti-tumor Chemistry group of the Drug Discovery Department. (¶ 14 at 26.)
(2) The Drug Discovery Group is responsible for Bristol's basic research activities, including the synthesis of new drug compounds (taxol analogs), the initial and preliminary testing of those compounds and the determination as to whether the compounds synthesized indicate activity in certain tumor lines. (¶ 7 at 24.)
(3) Within Bristol's Drug Discovery Department, the patented intermediates were used to assist Bristol's basic researchers in developing a structure-activity relationship ("SAR") database, an important tool used by Bristol in its basic research. (¶ 17 at 27.)
(4) Bristol's exploratory basic research activities conducted in Drug Discovery resulted in collecting "substantial SAR information (in vitro and in vivo data) on more than 1,000 compounds" synthesized in Drug Discovery. (¶ 18 at 27.)
(5) If any compounds synthesized in Drug Discovery show activity against any of the tumor lines against which they are tested, the compound is then run through a series of tests to determine if it is worthwhile to pursue further development activities. (¶ 8 at 25.)
(6) The decision-making body within Bristol which determines whether to pursue further development of a molecule synthesized and identified in Drug discovery is the Drug Discovery Management Committee ("DDMC"). DDMC does not decide whether an IND or a new drug application should be filed with the FDA. (¶ 9 at 25.)
(7) If DDMC decides to continue development, the compound is then transferred to Chemical Process Development where a process for making the compound is developed and the compound is further optimized, synthesized, tested, analyzed and scaled up. (¶ 10 at 25.)
In addition, the Court relies on the following uncontradicted testimony:
(8) Dr. Dolatrai Vyas, Director of Chemistry at Bristol, stated that for the five years spanning 1991 to 1996, his group conducted basic research creating new analogs of existing drugs, including the compound paclitaxel ("Taxol"). (Vyas Decl. dated Aug. 7, 1996 at ¶ 4.) "`Analogs' are compounds that incorporate various structural changes to existing compounds" that are made "to acquire additional knowledge about how structural changes and features affect the activity and properties of compounds." (Id.) Dr. Vyas stated that, on average, his group has made two to three new analogs of taxol per week in very small amounts. (Id.) According to Dr. Vyas, "[t]he initial screening tests . . . are the first steps in creating a record that may be submitted to the FDA with an investigational new drug application ("IND") and, following successful clinical trials in humans, a new drug application ("NDA")." (Id. at ¶ 6.)
(9) In his deposition, Dr. Vyas stated that SAR data identified whether the modification of each of the compounds resulted in any changes in its activities. (Solander Decl. dated Apr. 6, 2001, Ex. 2 at 209.) Dr. Vyas also testified that new drug candidates are identified through a process of evaluating the various analogs in primary and secondary tests and then "narrow[ing] down the leads until you find the ultimate lead." (Id. at 144.)
(10) Vittorio Farina, principal scientist in Bristol's Drug Discovery group from 1990 until April, 1993, testified that "our major goal was to define the structure/activity relationships in the Taxol series, and we prepared a number of derivatives of Taxol by chemical modification and submitted them to biological evaluation. (Bock Decl. dated May 1, 2001, Ex. 76 at 17.) "The purpose [for defining structure/activity relationships for Taxol] was to develop a second generation compound with some kind of improved properties over Taxol" to be marketed by Bristol. (Id. at 20-21.) A draft PLP (preclinical lead profile) BMS-185660 was prepared on November 4, 1992 to obtain approval from upper management to actually develop this drug as a drug for market. (Solander Decl., Ex. 3 at 176-177; Bock Decl., Ex. 64 at 176-177.) This analog of taxol was water soluble, metabolized quickly to taxol and had in vivo activity superior to that of taxol. (Id. at 177.)
(11) Dr. John Kadow, group leader of Bristol's taxane analog program from the second quarter of 1993, testified that "[a]ll of our work is aimed at trying to get drugs that can eventually be submitted to the FDA . . . ." (Solander Del., Ex. 4 at 40; Bock Decl., Ex. 72 at 40.) "Every analog we make we hope will be an FDA submission, and we hope that eventually they'll work out well enough, but it's kind of a touch and go area, so some of the compounds don't measure up. But we use that information to sort of hone in on the compounds that are the optimum and would become the best drugs, and those are the ones we submit to the FDA." (Id. at 41.) Dr. Kadow testified that "We would make changes [to a specific location on the molecule], we would see the result, we would make a change, see what that did, then try to figure out what between those two molecules was responsible for the difference, and then make another change to determine whether another change might even make a more positive effect" (Solander Decl., Ex. 4 at 69-70.) "Sometimes a change at one position would be good in one analog and bad in another analog because of the rest of the molecule. So it wasn't always black and white. Like, for example, removing a hydroxy group one time might be bad, but removing the same hydroxy group another time might be good [because of something on another position of the molecule]." (Id. at 71-72.)
(12) Since 1993, Bristol has made two submissions in the taxane area, to the FDA (analogs identified as BMS-184476 and BMS-188797) (Id. at 40-41).
RPR's patent on the intermediates at issue did not issue until June of 1993.
Numerous chemists identified Kadow as their manager or supervisor — James Giles Tarrant (Aug. 5, 1998 Dep. at 18 located at Solander Decl. Ex. 11); Paul Scola (Sep. 2, 1998 Dep. at 56 located at Bock Decl. Ex. 58); Mark Wittman (July 8, 1998 Dep. at 34 located at Bock Decl. Ex. 86); Joydeep Kant (Sep. 30, 1998 Dep. at 15 located at Solander Decl. Ex. 15); Donald Cook (July 15, 1998 Dep. at 16-17, 26 located at Bock Decl. Ex. 79, Solander Decl. Ex. 18) (also identifying May Xue and Karen Du as having worked for Kadow); Timothy David Johnson (Aug. 12, 1998 Dep. at 24-25 located at Bock Decl. Ex. 81); Harold Mastalerz (July 1, 1998 Dep. at 80 located at Bock Decl. Ex. 82). See also RPR Memo. in Opp. to Bristol's Cross-Motion dated May 1, 2001 at p. 10, n. 11. Some also agreed that Farina and Kadow reported to Dr. Vyas — Tarrant (Aug. 5, 1998 Dep. at 45 located at Bock Decl., Ex. 85 at 45); Mastalerz (July 1, 1998 Dep. at 80 located at Bock Decl. Ex. 82).
A rational jury could only conclude based on these undisputed facts that it was reasonable, objectively, for a party in Bristol's position to believe that there was a "decent prospect" that its use of the RPR intermediates in Bristol's experiments "would contribute (relatively directly) to the generation of kinds of information that was likely to be relevant in the process by which the FDA would decide whether to approve the product." Intermedics, 775 F. Supp. at 1280. Accordingly, Bristol's experiments with the RPR patented intermediates are entitled to the exemption Congress provided in 35 U.S.C. § 271(e)(1) as "solely for uses reasonable related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs . . . ."
This conclusion is buttressed by Bristol's role in the clinical development of Taxol beginning around 1990. Taxol (the generic name is paclitaxel) is the first in a new class of compounds, the taxanes, which prevents cancer cells from multiplying by interfering with cell division in a unique way (Id., Ex. 4 at 4; BMS-00096, 156-157). Pursuant to an invitation issued in August 1989, Bristol entered into an exclusive collaborative research and development agreement (CRADA) with the National Cancer Institute (NCI) on January 19, 1991 for the clinical development of taxol into an approved drug available to the public. (Bock Decl., Ex. 13.) Bristol submitted a new drug application for taxol to the FDA in July 1992, and in December 1992, Taxol, a brand name, was cleared for use in treating patients with ovarian cancer.
RPR argues that Section 271(e)(1) should only apply after a drug candidate was actually filed with the FDA or after a particular drug candidate has been identified in such filing. RPR's contention that Section 271(e)(1) should apply only after a drug candidate was actually filed with the FDA is contrary to the case law and legislative and unsupported by the statutory language. In Amgen v. Hoechst Marion Roussel, Inc., 3 F. Supp.2d 104 (D. Mass. 1998), defendant's use of the patent for testing in Japan occurred before any FDA approval had been sought. Nevertheless, the Court held that the defendant's efforts to evaluate the effects of alterations in the process were entitled to the protection of Section 271(e)(1) (Id. at 109). The Court stated:
Amgen's post hoc analysis misses the mark. The Defendants are protected by the statute if the production of the three batches of GA-EPO was objectively likely to generate useful information, even if the results were later discarded or abandoned for reasons unrelated to FDA approval. The exemption is not so ephemeral that it will be lost as a result of conduct which post dates the making, using or selling of the patented product.
(Id., 3 F. Supp.2d at 110.) This holding is in accord with the legislative history of Section 271(e)(1) which states:
A party which develops such information, but decides not to submit an application for approval is protected as long as the development was done to determine whether or not an application for approval would be sought.
1984 U.S.C.C.A.N. at 2678.
RPR's contention that Section 271(e)(1) only applies after a particular drug candidate has been selected or filed with the FDA would have the effect of preventing competitors from experimenting with patented inventions in order to create new or improved drugs. This interpretation would seem to negate Congress' intent to have new drugs come to market without delay upon the expiration of a patent. As Bristol states:
At bottom, the § 271(e)(1) exemption has to apply to all activities reasonably related to an actual or possible FDA application from the very first synthesis of an analog. It would be nonsensical for the exemption to apply only in the development process after a drug candidate was identified, or after a drug candidate was actually filed with the FDA. If so, the exemption would never be reached because the underlying preliminary research and development work could not be undertaken. RPR points to no case law in support of that theory which would plainly frustrate Congress' intent.
(Bristol's Reply Mem. dated May 21, 2001 at 5.) The Special Master found Bristol's reasoning on this point to be persuasive and recommended that the Court consider uses of the patented intermediates as reasonably related to an FDA application,
(1) even where each such use does not directly result in an FDA application being filed, so long as the use was made in order to determine whether or not an application for approval would be sought; and (2) even though each such use of the patented intermediates may not directly yield information that could be submitted to the FDA, but relates to a preliminary activity that may facilitate or be useful in generating information that could be submitted to the FDA.
(Report at 10-11.) The Court agrees with the positions taken by Bristol and the Special Master and interprets Section 271(e)(1) accordingly.
In addition, the Court notes that the Drug Discovery Group had already identified a drug candidate during its experiments with taxol analogs as early as 1992.
RPR also argues that it is entitled to summary judgment because Bristol's use of the patented intermediates in early stage research to develop numerous taxane analogs, each of which has only a small probability of being sufficiently useful to warrant an application to the FDA, does not satisfy the Intermedics test's requirement that there be " a `decent prospect' that an FDA filing will result" from each specific use of RPR's patented intermediates. (RPR Resp. at 4.) RPR's position appears to be based on a misreading of the Intermedics standard. The Court in Intermedics stated that there must be "a decent prospect that the `use' in question would contribute (relatively directly) to the generation of kinds of information that was likely to be relevant in the processes by which the FDA would decide whether to approve the product." 775 F. Supp. at 1280. The decent prospect referred to in this statement is the likelihood of the information generated being relevant to information sought by the FDA, not the likelihood of submission of the new product to the FDA.
RPR's final argument, that it is entitled to summary judgment because Bristol's use of the patented intermediates to attempt to create a structure-activity relationship ("SAR") database and obtain a number of patents on the taxane analogs created by its experiments is not reasonably related to an FDA filing, is legally incorrect. RPR has conceded that Bristol used its intermediates to run experiments in an attempt to discover a paclitaxel drug with better properties. Such use of the patented intermediates is, on its face, use reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs. The case law holds that subsequent use of data developed for FDA approval does not violate Section 271(e)(1).
In Telectronics Pacing Systems v. Ventritex, Inc., 982 F.2d 1520 (Fed. Cir. 1992), the Federal Circuit said:
If Congress intended to . . . [prevent] competitors from using, in an admittedly noninfringing manner, the derived test data for fund raising and other business purposes, it would have made that intent clear. The statute contains no such provision.
(Id. at 1525; see also Abtox, Inc. v. Exitron Corp., 122 F.3d 1019, 1029-30 (Fed. Cir. 1997) ("[Section 271(e)(1)] therefore does not look to the underlying purposes or attendant consequences of the activity (e.g., tests led to the sale of the patent), as long as the use is reasonably related to FDA approval"); Elan Transdermal Ltd. v. Cygnus Therapeutic Sys., 24 U.S.P.Q.2d 1926 (N.D. Cal. 1992) (use of data for other potential purposes does not violate Section 271(e)(1) so long as use was reasonably related to obtaining FDA approval). In Intermedics, 775 F. Supp. at 1281-89, the court held that acts such as demonstrating the allegedly infringing devices at various scientific meetings/trade shows and obtaining foreign patent rights on the allegedly infringing device were collateral non-infringing activities irrelevant to the court's inquiry because the court's inquiry should be confined to "uses" that would be infringing. Thus Bristol's use of clinical data obtained through its experiments for preparing and filing patent applications for its new analogs and preparation of a SAR database would not violate the Section 271(e)(1) safe harbor.
Based upon the undisputed facts, a rational jury could only conclude that Bristol's uses of the patented intermediates were "reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs . . . ." Accordingly, the Court denies RPR's motion for summary judgment and grants Bristol's cross motion for summary judgment.
IT IS SO ORDERED.