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No Safe Harbor for Preclinical General Biomedical Research

June 06, 2003

Decision icon Decision

Last Month at the Federal Circuit - June/July 2003

Judges: Rader (author), Newman, and Prost

In Integra LifeSciences I Ltd. v. Merck KGaA, No. 02-1052 (Fed. Cir. June 6, 2003), the Federal Circuit upheld a district court’s claim construction and affirmed its ruling that 35 U.S.C. § 271(e) did not immunize Merck KGaA (“Merck”) against liability for patent infringement. The Federal Circuit remanded to the district court consideration of a jury’s $15,000,000 reasonable royalty reward, after the district court granted Merck’s SJ motion asserting invalidity of one of Integra LifeSciences I Ltd.’s (“Integra”) claims.

Integra owns U.S. Patent Nos. 4,789,734; 4,792,525; 4,879,237; 4,988,621; and 5,965,997 (“the ‘734, ‘525, ‘237, ‘621, and ‘997 patents,” respectively), which are all related to a short peptide with the amino acid sequence arginine-glycine-aspartate referred to as the “RGD peptide.” This peptide mediates the adhesion of cells to their surroundings and plays a role in wound healing and the growth of blood vessels. In the hands of a scientist from the Scripps Institute, for example, it purportedly showed promise for promoting wound healing, attaching prosthetic devices, and treating a plethora of diseases, including cancer and diabetic retinopathy.

Merck entered into an agreement with the Scripps Institute to fund experiments necessary to satisfy the biological bases and FDA regulatory requirements for clinical trials with drug candidates derived from the RGD peptide. Scripps scientists conducted research directed at explaining the mechanism of action of several candidate drugs, determining which could be safely tested in humans, and determining the mode of administering the candidate drugs that would produce the optimum therapeutic effect. This research resulted in the identification of a lead candidate for clinical development.

Integra sued Merck, Scripps, and the scientist in charge of the research that identified the leading drug candidate based on the RGD peptide, asserting that the research infringed its patents. Merck answered that the research was protected by the safe harbor provided by 35 U.S.C. § 271(e)(1), and that Integra’s patents were invalid.

The district court granted Merck’s SJ motion on claim 2 of the ‘621 patent, and a jury found Merck liable for infringing the ‘734, ‘525, ‘237, and ‘997 patents.

The 35 U.S.C. § 271(e)(1) safe harbor encompasses actions “solely for uses reasonably related to the development or submission of information under a Federal law which regulates the manufacture, use, or sale of drugs or veterinary biological products.” The Federal Circuit interpreted 35 U.S.C. § 271(e)(1) by determining whether the safe harbor reaches back down the chain of experimentation to include the identification and development of new drugs that will be subject to FDA approval. It considered that the Scripps- Merck experiments did not supply information to the FDA, but rather identified a lead candidate for testing under the FDA procedures, and concluded that the experiments were not solely for uses reasonably related to FDA clinical tests.

The Federal Circuit reasoned that the central purpose of the exemption is to allow the production of information to the FDA. The term “reasonably” permits some activities that do not directly produce information for the FDA, but, according to the Court, these activities do not include new drug development.

The Federal Circuit placed the context of the safe harbor as facilitating the expedited approval of patented pioneer drugs. It confined the scope of 35 U.S.C. § 271(e)(1) to de minimus encroachment on the rights of the patentee, reasoning that sheltering the Scripps-Merck experiments would effectively vitiate the exclusive rights of patentees owning biotechnology-tool patents, since patented tools facilitate research that identifies candidate drugs.

With respect to claim construction, the Federal Circuit interpreted the term “peptide” as representing two or more amino acids covalently joined together by peptide bonds. The term “peptide” encompasses peptides of differing structural forms and is not limited to linear peptides, even when the patent does not explicitly refer to a nonlinear, e.g., a cyclic configuration.

With respect to the damages award, the Federal Circuit determined that the record was unclear regarding the date of a hypothetical negotiation between the patentee and the infringer at a time before the infringing activity began. It remanded the issue to the district court to determine when the first infringing activity occurred.

Judge Newman concurred-in-part and dissented-in-part. She concurred that the 35 U.S.C. § 271(e)(1) safe harbor does not reach back down the chain of experimentation to include identification and development of new drugs. Her dissent focused on the question of whether, and to what extent, a patentee’s permission is required to study that which is patented. She argued that the Scripps-Merck experiments were exempt from requiring such permission because the experiments were conducted to understand, improve upon, or modify patented subject matter, and did not include activity associated with the development and commercialization of infringing subject matter.