Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

SMITHKLINE BEECHAM CORPORATION v. APOTEX CORPORATION

July 16, 2004.

SMITHKLINE BEECHAM CORPORATION, SMITHKLINE BEECHAM, P.L.C., BEECHAM GROUP, P.L.C. and GLAXOSMITHKLINE, P.L.C.
v.
APOTEX CORPORATION, APOTEX, INC. and TORPHARM, INC. v. PENTECH PHARMACEUTICALS, INC. and PAR PHARMACEUTICALS, INC. SMITHKLINE BEECHAM CORPORATION, SMITHKLINE BEECHAM, P.L.C. and BEECHAM GROUP, P.L.C. v. GENEVA PHARMACEUTICALS, INC. and SUMIKA FINE CHEMICALS CO., LTD. SMITHKLINE BEECHAM CORPORATION, SMITHKLINE BEECHAM, P.L.C. and BEECHAM GROUP, P.L.C. v. ZENITH GOLDLINE PHARMACEUTICALS, INC. and SUMIKA FINE CHEMICALS CO., LTD. SMITHKLINE BEECHAM CORPORATION, SMITHKLINE BEECHAM, P.L.C. and BEECHAM GROUP, P.L.C. v. ALPHAPHARM PTY, LTD. and SUMIKA FINE CHEMICALS CO., LTD. SMITHKLINE BEECHAM CORPORATION, and BEECHAM GROUP, P.L.C. v. ANDRX PHARMACEUTICALS, INC. ANDRX PHARMACEUTICALS, L.L.C. BASF CORPORATION, BASF PHARMACHEMIKALIEN GMBH & CO. KG and KNOLL AG. SMITHKLINE BEECHAM CORPORATION, and BEECHAM GROUP, P.L.C. v. TEVA PHARMACEUTICALS USA, INC.



The opinion of the court was delivered by: RICHARD B. SURRICK, District Judge

MEMORANDUM AND ORDER

On June 25, 2004, Plaintiffs SmithKline Beecham Corporation, SmithKline Beecham, P.L.C., Beecham Group, P.L.C. and GlaxoSmithKline, P.L.C. ("SmithKline") filed a Motion to Stay the Consolidated Actions and for a Protective Order. (Civil Action No. 99-2926, Doc. No. 106.) SmithKline requested that we temporarily stay all proceedings between it and all Defendants with the exception of the proceedings between SmithKline and Defendants Apotex Corporation, Apotex, Inc., and Torpharm, Inc. (collectively, "Apotex"). On June 23, 2004, we ordered that any responses to SmithKline's Motion be filed within seven days. (Civil Action No. 99-2926, Doc. No. 108.) Expedited briefing was necessary because SmithKline sought to postpone several depositions scheduled for the first week of July, 2004. We received the following responses: Defendant Sumika Fine Chemical Co., Ltd. ("Sumika") requests that we deny SmithKline's Motion and permit Sumika to proceed with its depositions; Apotex opposes SmithKline's Motion to the extent that a stay would limit the discovery Apotex wished to pursue; Defendant Teva Pharmaceuticals USA, Inc. stipulated with SmithKline to a stay of discovery; Defendants BASF Corporation, BASF Pharmachemikalien GmbH & Co. KG, and Knoll Ag (n/k/a Abbott GmbH) conditionally agree not to oppose SmithKline's request to stay discovery;*fn1 and Defendants Andrx Pharmaceuticals, Inc. and Andrx Pharmaceuticals, L.L.C. state that they do not oppose SmithKline's request. In addition, SmithKline and Defendant Zenith Goldline Pharmaceuticals have entered into a Consent Judgment and Injunction, which, if approved by the Court, will end the proceedings between them. On July 2, 2004, we entered an Order granting SmithKline's Motion, temporarily staying all proceedings in Civil Action Nos. 99-2926, 00-5953, 02-1484, 01-1027, 01-3364, 02-8493, 01-2981, 03-6117, and 03-3365, and issuing a protective order postponing any depositions in those Civil Actions. In this Memorandum, we explain why we concluded that a temporary stay of these proceedings was appropriate at this juncture. We also take this opportunity to reconsider, sua sponte, our Order dated March 26, 2004, in which we declined to certify, pursuant to Federal Rule of Civil Procedure 54(b), our December 20, 2002 Order granting summary judgment after determining that several of SmithKline's patent claims were invalid. As explained in more detail below, we now conclude there is no just reason to delay SmithKline's appeal of our decision holding U.S. Patent No. 6,113,944 (the "`944 Patent") invalid. Accordingly, we direct the Clerk to enter that portion of our December 20, 2002 Order as a final, appealable judgment pursuant to Rule 54(b). I. BACKGROUND*fn2

These consolidated cases began with claims of patent infringement made by SmithKline. The patents at issue cover certain forms of paroxetine hydrochloride, processes for making paroxetine hydrochloride, and uses of paroxetine hydrochloride. SmithKline manufactures the hemihydrate form of paroxetine hydrochloride, and then tablets and sells that product in the United States under the trademark Paxil® ("Paxil"). Paxil is an anti-depressant drug used to treat a variety of disorders, and is one of the most widely prescribed prescription drugs in the United States.

  The Defendants in these cases are generic drug manufacturers (and suppliers of those manufacturers) who seek to sell generic versions of Paxil. SmithKline claims that the Defendants' generic products and/or methods of manufacturing the same infringe one or more of SmithKline's patents. One of these generic manufacturers is Apotex. In March, 1998, Apotex became the first generic drug manufacturer to file an Abbreviated New Drug Application ("ANDA") with the U.S. Food and Drug Administration ("FDA") seeking its approval to market a generic version of Paxil.

  A. The Hatch-Waxman Amendments

  We briefly digress to discuss the statutory framework governing the approval of generic drugs. The introduction of new prescription drugs to the marketplace is governed by the Food, Drug & Cosmetic Act. See 21 U.S.C. § 301 et seq. (the "FDC Act"). Generally, any company seeking to market a new drug must first receive the approval of the FDA by submitting a New Drug Application ("NDA"). See id. § 355(a). The NDA is a thorough, time-consuming, and costly process that must include data from clinical studies that support the proposed drug's safety and effectiveness. See Mova Pharm. Corp. v. Shalala, 140 F.3d 1060, 1063 (D.C. Cir. 1998).

  Prior to 1984, both brand name and generic drug manufacturers who wished to bring a drug to market were required to file a NDA.*fn3 Concerned that the NDA was a "cumbersome drug approval process [that] delayed the entry of relatively inexpensive generic drugs into the market place," Mylan Pharm., Inc. v. Shalala, 81 F. Supp.2d 30, 32 (D.D.C. 2000), Congress enacted the Hatch-Waxman Amendments to the FDC Act. See Drug Price Competition and Patent Term Restoration Act of 1984, Pub. L. No. 98-417, 90 Stat. 1585 (1984) (codified in scattered sections of Titles 21, 35, and 42 of the United States Code). The Hatch-Waxman Amendments simplified the approval mechanism for generic versions of drugs that the FDA had approved via the NDA process.

  Under the Hatch-Waxman Amendments, a company that wishes to market a generic version of a pioneer drug no longer needs to file a complete NDA. Instead, Congress created the ANDA process, by which a generic drug manufacturer can rely on the clinical studies performed by the pioneer drug manufacturer and is not required to prove the safety and effectiveness of its generic drug from scratch. Instead, the generic drug manufacturer proves that its product is safe and effective principally by showing that its drug is bioequivalent to the brand name drug it wants to copy. See 21 U.S.C. § 355(j)(2)(A). Although Congress was interested in increasing the availability of generic drugs, it also wanted to protect the rights of those holding patents that claim pioneer drugs. The Hatch-Waxman Amendments, therefore, require that an NDA contain a list of any patents "which claim[] the drug . . . or which claim[] a method of using such drug and with respect to which a claim of patent infringement could reasonably be asserted if a person not licensed by the owner engaged in the manufacture, use, or sale of the drug." Id. § 355(b)(1). The FDA maintains a record of the patents that claim approved drugs in its publication entitled Approved Drug Products with Therapeutic Equivalence, commonly known as the Orange Book. See id. § 355(j)(7)(A). An applicant filing an ANDA must certify whether its proposed generic drug will infringe any of the patents listed in connection with the pioneer drug in the Orange Book and, if not, why not. An applicant filing an ANDA has four certification options. It may certify that: (1) the required patent information has not been filed, (2) the patent has expired, (3) the patent has not expired but will expire on a particular date, or (4) the patent is invalid or will not be infringed by the drug for which the applicant seeks approval. See id. § 355(j)(2)(A)(vii). The last of these options, and the one used by Apotex in its ANDA, is the so-called Paragraph IV certification.

  An applicant who makes a Paragraph IV certification is required to give notice to the holder of the patent alleged to be invalid or not infringed, stating that an ANDA has been filed seeking approval to engage in the commercial manufacture, use, or sale of the drug before the expiration of the patent, and setting forth a detailed statement of the factual and legal basis for the applicant's opinion that the patent is not valid or will not be infringed. See id. §§ 355(b)(3)(B), 355(j)(2)(B)(ii). Upon receiving notice of a Paragraph IV certification, which technically is an act of infringement by the ANDA applicant, see 35 U.S.C. § 271(e)(2), the patent owner has forty-five days in which to initiate a patent infringement suit against the ANDA applicant, or else approval of the ANDA will be effective immediately, 21 U.S.C. § 355(c)(3)(C). If the patent owner brings such a suit, then approval of the ANDA may not be made effective until the court rules that the patent is invalid or not infringed or until the expiration of (in general) thirty months, whichever first occurs. Id.

  B. The Illinois Case

  Since Apotex's ANDA filing constituted a technical act of infringement of those patents SmithKline had listed in connection with Paxil in the Orange Book, SmithKline sued Apotex in the Northern District of Illinois for patent infringement (the "Illinois Case"). The patent at issue in the Illinois Case was U.S. Patent No. 4,721,723 (the "`723 Patent"), which claims crystalline paroxetine hydrochloride hemihydrate, along with certain processes for making it. During the course of that litigation, SmithKline moved for partial summary judgment that claim 1 of the `723 Patent was not invalid by way of the public use bar in 35 U.S.C. § 102(b).*fn4 Although SmithKline had conducted clinical trials in the United States with paroxetine hydrochloride more than one year before it filed the patent application that led to the `723 Patent, SmithKline argued that its clinical trials were experimental uses and therefore did not trigger the public use bar in § 102(b). The Court agreed and granted SmithKline's partial motion for summary judgment. SmithKline Beecham Corp. v. Apotex Corp., 286 F. Supp.2d 925, 936-38 (N.D. Ill. 2001).

  The Illinois Case went to trial in February, 2003. After an approximate three-week bench trial, the Court held that Apotex was likely to market a paroxetine product that contained some of the hemihydrate form. SmithKline Beecham Corp. v. Apotex Corp., 247 F. Supp.2d 1011, 1032 (N.D. Ill. 2003). Though Apotex intended to market only the anhydrate form of paroxetine, for reasons not relevant here, the Court found that Apotex's product was likely to contain at least some small amount of the hemihydrate form. Id. Nevertheless, the Court ruled that Apotex would not infringe the `723 Patent. Id. at 1052. It reached this conclusion by construing the `723 Patent to claim only a "commercially significant" amount of the hemihydrate form of paroxetine. Id. at 1030. The Court found that Apotex's product would likely not contain a commercially significant amount of paroxetine hemihydrate, and, therefore, that it would not infringe the `723 Patent. Id. at 1031.

  SmithKline appealed the Court's non-infringement ruling to the Federal Circuit, and Apotex cross-appealed on the issue of invalidity. SmithKline Beecham Corp. v. Apotex Corp., 365 F.3d 1306 (Fed. Cir. 2004). A unanimous panel of the Federal Circuit disagreed with the Northern District of Illinois' claim construction, holding that the `723 Patent claimed any amount — even a commercially insignificant amount — of paroxetine hemihydrate. Id. at 1313, 1324. The panel agreed that Apotex's product would likely contain some amount of paroxetine hemihydrate, thereby presenting a prima facie case of patent infringement. Id. at 1312, 1324.

  Nevertheless, the Federal Circuit dismissed SmithKline's claims because it held that the `723 Patent was invalid. The majority of the panel held that the `723 Patent was invalid for public use based on SmithKline's clinical trials of paroxetine hemihydrate. Id. at 1320. Those clinical trials were not experimental uses, the majority ruled, because, (1) to qualify as experimental uses, the experiments must have been testing claimed features of the invention, id. (citing In re Theis, 610 F.2d 786, 793 (3d Cir. 1979)); (2) SmithKline's clinical trials tested the safety and efficacy of paroxetine hemihydrate as an antidepressant; and (3) claim 1 of the `723 Patent only claimed the paroxetine hemihydrate molecule, not its possible use as an anti-depressant, id. The Court cautioned that "a patentee should understand that testing the properties, uses, and commercial significance of a compound claimed solely in structural terms may start the clock under § 102(b) for filing a claim that is not limited by any property, commercially significant amount, or other use of the compound."*fn5 Id. On June 4, 2004, SmithKline sought an en banc review of the Court's public use holding. Should that request be denied, SmithKline intends to seek further review of that holding by petitioning for a writ of certiorari from the Supreme Court.

  C. The Pennsylvania Cases

  While the Illinois Case was pending, SmithKline filed the instant patent infringement actions (the "Pennsylvania Cases"), which we have consolidated. In each of these actions, SmithKline asserts patent infringement claims against generic drug manufacturers (and suppliers of those manufacturers) who seek to sell generic versions of Paxil. The Defendants in these cases have counterclaimed against SmithKline seeking declaratory judgments of patent invalidity, non-infringement, ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.