Addressing Breach Of Method-Of-Use Patents By Generics

The U.S. Court of Appeals for the Federal Circuit on April 16, 2012, in Bayer Schering Pharma AG v. Sandoz Inc., Nos. 2011-1143, -1228 (Yasmin), affirmed a district court's holding that as a matter of law, generic drug makers could not infringe patent claims reciting a method of use of a U.S. Food and Drug Administration (FDA)-approved drug where the FDA had not approved the drug for the claimed uses, and where the FDA-approved labeling did not indicate instructions or intent to encourage the claimed use.

Yasmin is a drug Bayer produces and markets under FDA approval as an oral contraceptive. The asserted patent did not claim the drug Yasmin itself or the use of Yasmin solely as an oral contraceptive. Rather, the patent was directed to a method of use narrowly focused on simultaneously achieving three effects in patients: an anti-androgenic effect (anti-acne), an anti-aldosterone effect (diuretic) and a contraceptive effect.

The FDA-approved label for Yasmin undisputedly indicated the drug was approved as an oral contraceptive. However, the parties disputed whether the label could also be interpreted to indicate that Yasmin should be used as claimed, i.e., as an anti-acne and diuretic drug as well as a contraceptive.

Watson Pharmaceuticals Inc. and Sandoz argued that Yasmin was approved only for contraceptive use, that their abbreviated new drug applications (ANDAs) necessarily included an "indications and usage" section which provided information related only to contraceptive use and that such contraceptive-only indications were not covered by Bayer's patent.

The majority opinion identified the critical question in this case to be whether the FDA affirmatively found Yasmin to be safe and effective for the additional purposes of inducing anti-acne and diuretic effects in a patient with a specific need for all three of those effects.

It was not enough that the FDA was aware that Yasmin could cause the patented effects, or even that the FDA approved marketing materials promoting the use of Yasmin to achieve those effects.

The majority identified the U.S. Court of Appeals for the Federal Circuit's previous decisions in Warner-Lambert Co. v. Apotex Corp., 316 F.3d 1348 (Fed. Cir. 2003), and Allergan Inc. v. Alcon Labs. Inc., 324 F.3d 1322 (Fed. Cir. 2003), as informing the current opinion.

In both cases, the generic drug manufacturer sought FDA approval to market either an unpatented or expired patented drug for an unpatented FDA-approved use...