Alert: Supreme Court Extends Safe Harbor Protections for Research and Development Activities Using Patented Compounds
June 17, 2005
In a decision that has been followed closely by the biotech industry, the U.S. Supreme Court this week has expanded the scope of research and development activities that would be exempt from infringement of an existing patent. The Court unanimously held in Merck KGAA v. Integra Lifesciences I, Inc., 2005 WL 1383624, *1, 8 (U.S. June 13, 2005) that the Federal Circuit too narrowly construed the safe harbor exemption to patent infringement contained in 35 U.S.C. § 271(e)(1) in holding that Merck’s research activities did not qualify for protection under that section. The Court concluded that the safe harbor provision of section 271(e) not only exempts research activities that lead directly to the creation of information that is used in a submission to the Food and Drug Administration (“FDA”), but also covers the use of patented compounds where “there is a reasonable basis for believing the experiments will produce ‘the types of information that are relevant to an [investigational new drug application] or [new drug application].’” Id.
Respondent Integra Lifesciences I, Ltd., (“Integra”) owned five patents related to the tripeptide sequence Arg-Gly-Asp (“RGD peptide”), which promotes cell adhesion. As part of a research project aimed at identifying and developing potential drug candidates for angiogenesis inhibition, Merck sponsored research that utilized the RGD peptides as “positive controls” in the experiments. Integra filed a patent infringement suit against Merck, alleging that Merck willfully infringed and induced others to infringe its RGD peptide patents. Merck took the position that its research involving the RGD peptides was protected under the exemption to patent infringement carved out by 35 U.S.C. § 271(e)(1) and thus not infringing.
Section 271(e)(1) provides a safe harbor from infringement of an existing patent for research and development activities in connection with a drug or biological product that are “reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs . . . .” In its defense to Integra’s suit, Merck contended that section 271(e)(1) covered its use of the RGD peptides even though the information from that research was not included in a submission to the FDA. At trial, the jury concluded that Merck infringed the Integra patents and that its use of the RGD peptides was not protected by section 271(e)(1).
A divided panel of the Federal Circuit affirmed the trial court’s judgment of infringement. The court held as a matter of law that section 271(e)(1) did not apply to Merck’s use of the RGD peptides because “it was not clinical testing to supply information to the FDA, but only general biomedical research to identify new pharmaceutical compounds.” Integra Lifesciences I Inc. v. Merck KGAA, 331 F.3d 860, 866 (Fed. Cir. 2003). The court thus read section 271(e)(1) narrowly as applying only to activities that directly resulted in a submission to the FDA. Id. at 865.
In reversing the Court of Appeals, the Supreme Court held that section 271(e)(1)’s exemptions from infringement extended to all uses of patented inventions that were reasonably related to the development and submission of any information to the FDA. The Court based its decision in large part on the language of the statute, stating:
There is simply no room in the statute for excluding certain information from the exemption on the basis of the phase of research in which it is developed or the particular submission in which it could be included.
Merck, 2005 WL 1383624, at *6 (footnote omitted). According to the Court, the section 271(e)(1) exemption does not “categorically” exclude either (1) experimentation on drugs that are not ultimately the subject of an FDA submission or (2) the use of patented compounds in experiments that are not ultimately submitted to the FDA. Id., at *8. To construe the statute as the Federal Circuit did would, the Court declared, “effectively...limit assurance of the exemption to the activities necessary to seek approval of a generic drug,” which neither the language of section 271(e)(1) nor its history supports. Id. The Court concluded that section 271(e)(1) protects research using a patented compound as long as there is a “reasonable basis” for believing that that compound could be used to produce an effect that if successful, would be appropriate to include in a submission to the FDA. Id.
While the Court’s ruling unquestionably gives an expansive scope to the section 271(e)(1) safe harbor, the decision also left unanswered several key questions. For instance, how far down the pipeline of research and development do the provisions of section 271(e)(1) extend under the Court’s “relevance” standard? What constitutes “a reasonable basis for believing” that particular experiments will produce information that is potentially relevant to an FDA submission? What will the impact be of footnote 7, which expressly leaves open the question of whether
271(e)(1) exempts the use of research tools from infringement? What is the status of the common law research exemption, which the Court, notably, did not address? Courts will undoubtedly struggle in the future to answer these and other questions relating to the applicability to research of section 271(e)(1)’s safe harbor provisions.
For more information about this or other intellectual property-related matters, please contact Robert H. Sloss, Nan E. Joesten or Sangeetha Raghunathan, members of Farella Braun + Martel's Intellectual Property and Technology Group.