On November 7, 2023, a press release from the FTC announced that “the Federal Trade Commission (FTC) challenged more than 100 patents held by manufacturers of brand-name asthma inhalers, epinephrine autoinjectors, and other drug products as improperly or inaccurately listed in the Food and Drug Administration’s (FDA) publication of “Approved Drug Products with Therapeutic Equivalence Evaluations,” commonly known as the “Orange Book” (here). The FTC is using the current FDA procedures for requesting delisting of the patents that it finds objectionable. The FTC also sent letters to ten firms notifying them of the FTC’s action and warned that additional enforcement action might be taken if the patents are not delisted. The FTC notes that many of these patents are device patents, wherein the patents do not claim the active ingredient or the drug.
The FTC also issued a policy statement on September 23, 2023 (here) supported by the FDA regarding its perception of improper patent listings. The goal of this policy statement is to put market participants on notice that the FTC intends to scrutinize improper Orange Book patent listings to determine whether these constitute unfair methods of competition in violation of Section 5 of the Federal Trade Commission Act. The subsequent November 7th action clearly signals that the FTC is serious about ensuring that only appropriate patents are listed in the Orange Book.
This sounds like a big win for ANDA or 505(b)(2) applicants that might otherwise have to initiate a patent challenge against one of these patents, and this certainly may be the case in certain circumstances. However, remember that the Hatch-Waxman Act’s patent certification provisions create the artificial act of infringement, giving the ANDA or 505(b)(2) applicant the ability to challenge a listed patent during the thirty-month stay of approval if they are sued after giving proper paragraph IV notification to the patent and application holder. This gives the applicant a chance to litigate challenged patents during the application review process and prior to approval. However, not listing some of these “improperly listed” patents (in this case, for devices used for the delivery of a drug-device combination, as well as others) may be valid and won’t go away because a patent is no longer listed in the Orange Book. If an ANDA or 505(b)(2) applicant must then seek approval without being able to avail themself of the patent challenge procedures under Hatch-Waxman, then they could be subject to a lawsuit once their application is approved, delaying the potential lengthy patent-litigation process until after approval, or they could choose to go to market at risk, not knowing whether they are going to be sued for infringement after approval and marketing. If they market their product, are sued, and lose, they could be liable for treble damages.
A Hatch-Waxman patent lawyer friend of mine indicated that the generic or 505(b)(2) applicant might be able to bring a declaratory judgement, asking the court to find that the patent was invalid or not infringed during the review process, but suggested that the question of standing would likely be raised. That is because there was no product approval, and the litigation was brought outside of Hatch-Waxman’s “artificial infringement” provision, so there would be no actual controversy until the application was approved.
The question we all should be asking, framed by the FTC action, is: Should under-listing patents really be worse than over-listing patents?
While I believe that the FTC’s actions are warranted, I always worry about the law of unintended consequences, which, in this instance, could further delay bringing a generic or 505(b)(2) product to market as any patent litigation could kick the can down the road until after approval. Think about that before you celebrate.
