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In a holding that could significantly broaden the antitrust inquiry in the context of the Hatch-Waxman regulatory scheme, on February 13, 2020, the U.S. Court of Appeals for the First Circuit issued an opinion that may have wide-ranging implications for both branded companies that own, and generic companies that challenge, patents listed on FDA’s Orange Book that claim drug delivery devices.
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The Hatch-Waxman Amendments to the Food, Drug & Cosmetic Act, which were passed in 1984, essentially created the current generic drug industry by allowing sponsors to demonstrate bioequivalence without having to conduct costly and time-consuming clinical trials. With that market-entry barrier removed, real competition developed in what was previously a monopolistic marketplace. Generic drugs now account for about 90 percent of the total prescriptions dispensed in the United States but only about 23 percent of all dollars spent on prescription medications, saving American consumers almost two trillion dollars over the last decade.
Hatch-Waxman meaningfully incentivized generic drug companies’ ability to provide life-saving, cost-effective medications by granting 180-days of market exclusivity to the first applicant with a so-called Paragraph IV certification in an Abbreviated New Drug Application (ANDA). Innovator companies were equally incentivized to participate by being granted an automatic 30-month stay of approval of the ANDA upon filing a patent infringement suit against the ANDA applicant within statutory time limits. The United States is one of the only countries in the world to link regulatory approval of generic pharmaceutical products to its patent system.
The Hatch-Waxman patent certification and regulatory approval process is rife with complexity and nuance. Cozen O’Connor’s experienced attorneys have been lead litigation counsel for generic clients in scores of Paragraph IV litigations, and we have counseled clients on scores more. The vast majority of our cases have been litigated to a successful conclusion or settled favorably for our clients. After one negotiation, our adversary, the chief patent counsel for a well-known innovator company, said that our settlement agreement was so thorough, it addressed generic opportunities that the innovator had not even considered.
We closely track the fast-moving pharmaceutical marketplace to help industry participants identify and pursue market opportunities without delay. Two examples of changes that have significantly altered the competitive landscape for our clients are the Inter Partes Review procedure established by the America Invents Act of 2012 and the Food and Drug Administration’s Safety and Innovation Act of 2012. Cozen O’Connor advises clients on how these and other regulatory shifts alter decisions of how and when to pursue market entry.
In addition to regulatory change, pharmaceutical companies are also coming under increasing scrutiny by federal and state regulators charged with enforcing fraud, abuse and anti-corruption laws. The Cozen O'Connor Hatch-Waxman team works in close coordination with the firm’s recognized Internal Investigations & Criminal Defense group to respond to inquiries, investigations, and civil or criminal charges. We have experience handling enforcement actions by the Food & Drug Administration, Federal Trade Commission, Office of the Inspector General, Centers for Medicare & Medicaid Services, Department of Justice, Department of Health and Human Services, individual U.S. attorney’s offices, and state attorneys general.
The members of Cozen O’Connor’s Hatch-Waxman team are leaders in the intellectual property litigation bar. Our attorneys hold advanced degrees in the natural sciences and nearly all members have experience as research scientists in industry or academia, and we understand the intersection of law and science with respect to small molecules, biosimilars and hybrids. Our team includes former senior government attorneys, registered patent attorneys, and patent examiners for the U.S. Patent and Trademark Office.