IP News

Supreme Court to Rule on Experimental Use via the 'Safe Harbor' of 35 U.S.C. '271(e)(1)

On Jan. 7, 2005, the Supreme Court granted certiorari in Merck KGaG v. Integra LifeSciences I, Ltd., No. 03-1237. The question presented is whether the Federal Circuit erred in limiting the safe harbor exemption to clinical studies designed to provide information for Food and Drug Administration approval of a new drug.

At the trial level, Integra alleged that Merck had infringed its patents by performing animal trials with a potential new anticancer drug. After a jury trial, the U.S. District Court for the Southern District of California ruled that Merck's research was not protected by the safe harbor provision of 35 U.S.C. '271(e)(1). On appeal, the Federal Circuit affirmed the district court's opinion that the safe harbor provision did not apply to Merck's activities. Integra LifeSciences I Ltd. v. Merck KGaA, 331 F.3d 860 (Fed. Cir. 2003) (Rader, J.). The Federal Circuit found that since Merck's research was not “solely for uses reasonably related” to tests for the FDA, it was not covered by the safe harbor provision. Oral argument is expected in April, and a decision is expected by the end of June.

Second Circuit Holds That Federal Dilution Standard Is 'More Stringent' Than NY State Standard

In Savin Corp. v. Savin Group, No. 03-9266, 2004 U.S. App. LEXIS 25479 (2d Cir. Dec. 10, 2004), the Second Circuit vacated in part the lower court's decision that dismissed plaintiff's New York state-law dilution claim. The district court had dismissed plaintiff's state dilution claim based on its finding that plaintiff “failed to produce sufficient evidence to create a triable issue under the FTDA.” Relying on Winner Int'l LLC v. Omori Enters., 60 F. Supp. 2d 62 (E.D.N.Y. 1999), the lower court held that “[t]he standards for dilution under Section 360-1 are 'essentially the same as that under '43(a) [sic (c)] of the Lanham Act.'” The Second Circuit found that the Supreme Court's decision in Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 433 (2003) made the federal standard of actual dilution more stringent than the New York standard, which only requires a likelihood of dilution. Thus, the Second Circuit vacated the judgment of the district court on the state-law dilution claim and remanded this claim for consideration under New York's likelihood of dilution standard.

India Amends Law to Allow Drug Patents

India has amended its patent laws to allow product patents as part of a major overhaul of the country's intellectual property regime. India's new patent laws allow patents for food, drugs and chemicals, and embedded software. The impetus behind India's reform was a World Trade Organization (WTO) commitment to recognize foreign patents from Jan. 1, 2005, the culmination of a 10-year process. The amendment to the patent laws was made through a presidential decree and will become law if ratified by parliament at its next session in February. India already allowed process patents.

The new patent regime has provisions to ensure that prices will not spike, including compulsory licenses, the ability to revoke patents for the public interest, use inventions for public good, and the importation of products for their availability at the cheapest price. The new rules do not apply to drugs patented before 1995.

Previously, the Indian drug industry was dominated by generic drug manufacturers. Since the early 1970s, India allowed its drug companies to copy drugs patented in other countries as long as they used different manufacturing processes. This policy enabled some Indian drug makers to prosper, but also discouraged investment by multinational drug makers.

The new policy will likely stimulate investments in research and development in India and could lead to increased outsourcing by foreign drug companies, which are attracted by India's cheaper labor costs and the high skill level of the work force. The new patent laws, however, could adversely affect India's top generic manufacturers, such as Ranbaxy, Dr. Reddy's Labs, Cipla, Wockhardt, and Sun Pharmas. Analysts believe these companies will continue to challenge patents in other countries and to seek contracts as suppliers of drug ingredients for pharmaceutical companies.

Southern District of New York Finds Listerine Advertising Campaign Is Misleading

Judge Denny Chin of the U.S. District Court for the Southern District of New York preliminarily enjoined Pfizer Inc. from running commercials claiming that clinical studies proved that its Listerine mouthwash works as well as dental floss in fighting plaque. McNeil-PPC, Inc. v. Pfizer Inc., No. 04 Civ. 7684, 2005 WL 23307 (S.D.N.Y. Jan. 6, 2005).

McNeil-PPC, the plaintiff in this action, is a unit of Johnson & Johnson and is the top-selling floss manufacturer. Judge Chin held that the Pfizer campaign was misleading and “poses a public health risk,

as the advertisements present a danger of undermining the efforts of dental professionals ' and the A.D.A. ' to convince consumers to floss on a daily basis.” Id. at *23. In support of its advertising claims, Pfizer relied on two clinical studies that compared the efficacy of flossing and Listerine. Judge Chin found that the cited studies did not support Pfizer's claims and were not sufficiently reliable.

Pfizer also argued that its advertisements were not false or misleading because the American Dental Association (ADA) had approved its “as effective as floss” campaign. Judge Chin also dismissed this argument, finding, inter alia, that the ADA's approval was wrong.

Supreme Court to Rule on Experimental Use via the 'Safe Harbor' of 35 U.S.C. '271(e)(1)

On Jan. 7, 2005, the Supreme Court granted certiorari in Merck KGaG v. Integra LifeSciences I, Ltd., No. 03-1237. The question presented is whether the Federal Circuit erred in limiting the safe harbor exemption to clinical studies designed to provide information for Food and Drug Administration approval of a new drug.

At the trial level, Integra alleged that Merck had infringed its patents by performing animal trials with a potential new anticancer drug. After a jury trial, the U.S. District Court for the Southern District of California ruled that Merck's research was not protected by the safe harbor provision of 35 U.S.C. '271(e)(1). On appeal, the Federal Circuit affirmed the district court's opinion that the safe harbor provision did not apply to Merck's activities. Integra LifeSciences I Ltd. v. Merck KGaA , 331 F.3d 860 (Fed. Cir. 2003) (Rader, J.). The Federal Circuit found that since Merck's research was not “solely for uses reasonably related” to tests for the FDA, it was not covered by the safe harbor provision. Oral argument is expected in April, and a decision is expected by the end of June.

Second Circuit Holds That Federal Dilution Standard Is 'More Stringent' Than NY State Standard

In Savin Corp. v. Savin Group, No. 03-9266, 2004 U.S. App. LEXIS 25479 (2d Cir. Dec. 10, 2004), the Second Circuit vacated in part the lower court's decision that dismissed plaintiff's New York state-law dilution claim. The district court had dismissed plaintiff's state dilution claim based on its finding that plaintiff “failed to produce sufficient evidence to create a triable issue under the FTDA.” Relying on Winner Int'l LLC v. Omori Enters., 60 F. Supp. 2d 62 (E.D.N.Y. 1999), the lower court held that “[t]he standards for dilution under Section 360-1 are 'essentially the same as that under '43(a) [sic (c)] of the Lanham Act.'” The Second Circuit found that the Supreme Court's decision in Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 433 (2003) made the federal standard of actual dilution more stringent than the New York standard, which only requires a likelihood of dilution. Thus, the Second Circuit vacated the judgment of the district court on the state-law dilution claim and remanded this claim for consideration under New York's likelihood of dilution standard.

India Amends Law to Allow Drug Patents

India has amended its patent laws to allow product patents as part of a major overhaul of the country's intellectual property regime. India's new patent laws allow patents for food, drugs and chemicals, and embedded software. The impetus behind India's reform was a World Trade Organization (WTO) commitment to recognize foreign patents from Jan. 1, 2005, the culmination of a 10-year process. The amendment to the patent laws was made through a presidential decree and will become law if ratified by parliament at its next session in February. India already allowed process patents.

The new patent regime has provisions to ensure that prices will not spike, including compulsory licenses, the ability to revoke patents for the public interest, use inventions for public good, and the importation of products for their availability at the cheapest price. The new rules do not apply to drugs patented before 1995.

Previously, the Indian drug industry was dominated by generic drug manufacturers. Since the early 1970s, India allowed its drug companies to copy drugs patented in other countries as long as they used different manufacturing processes. This policy enabled some Indian drug makers to prosper, but also discouraged investment by multinational drug makers.

The new policy will likely stimulate investments in research and development in India and could lead to increased outsourcing by foreign drug companies, which are attracted by India's cheaper labor costs and the high skill level of the work force. The new patent laws, however, could adversely affect India's top generic manufacturers, such as Ranbaxy, Dr. Reddy's Labs, Cipla, Wockhardt, and Sun Pharmas. Analysts believe these companies will continue to challenge patents in other countries and to seek contracts as suppliers of drug ingredients for pharmaceutical companies.

Southern District of New York Finds Listerine Advertising Campaign Is Misleading

Judge Denny Chin of the U.S. District Court for the Southern District of New York preliminarily enjoined Pfizer Inc. from running commercials claiming that clinical studies proved that its Listerine mouthwash works as well as dental floss in fighting plaque. McNeil-PPC, Inc. v. Pfizer Inc., No. 04 Civ. 7684, 2005 WL 23307 (S.D.N.Y. Jan. 6, 2005).

McNeil-PPC, the plaintiff in this action, is a unit of Johnson & Johnson and is the top-selling floss manufacturer. Judge Chin held that the Pfizer campaign was misleading and “poses a public health risk,

as the advertisements present a danger of undermining the efforts of dental professionals ' and the A.D.A. ' to convince consumers to floss on a daily basis.” Id. at *23. In support of its advertising claims, Pfizer relied on two clinical studies that compared the efficacy of flossing and Listerine. Judge Chin found that the cited studies did not support Pfizer's claims and were not sufficiently reliable.

Pfizer also argued that its advertisements were not false or misleading because the American Dental Association (ADA) had approved its “as effective as floss” campaign. Judge Chin also dismissed this argument, finding, inter alia, that the ADA's approval was wrong.