An insight into generic patent strategies

Paul Tunnah interviews Pam Politis

Endo Pharmaceuticals

pharmaphorum caught up with Pam Politis, Senior Patent Attorney for Endo Pharmaceuticals in the US, to talk about generic patent strategies ahead of her presentation on this topic at the forthcoming marcus evans “3rd Annual Product and Pipeline Enhancement for Generics” conference in Washington, commencing June 28th. During this extensive interview, Pam provided some great, detailed insight into the world of patents and how generics companies manage the complex legal and financial risks in this area.

To listen to the full interview, please click on the play button below, with a shortened transcript of some key highlights shown in print below.

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Selected highlights

PT: What do you see as the biggest changes that you’ve seen in recent years in the area of drug patent and patent strategies?

PP: Well...the Hatch-Waxman law...is what allows generic competition at all, it allows the abbreviated application with the FDA and it’s been a growing level of assertiveness among the generics over that period of that time. The large generic companies have extensive resources and they have the ability to make more aggressive patent challenges...and also more aggressive between the generics, so we are seeing some in-fighting among one generic to the other. So I think that the biggest shift has just been for companies trying to exploit any avenue they can to get an edge.

PT: So what role do regulators as such the US Food and Drug Administration have in shaping patent law and strategy?

PP: I think that they work together... so patents serve to restrict the market based on the term of the patent that’s branded for the invention but the FDA also restricts the market for our products. So the branded pharmaceutical, once they get approval...give the FDA a list of patents that they say cover their approved drug. And now the FDA...requires the ANDA applicant to say something about every patent that is listed in the Orange Book, whether they are going to challenge it or whether they are going to wait for it to expire and the FDA withholds their approval based on the statements concerning the patents. They’ve definitely intertwined and that Hatch-Waxman process has become a primary criteria for generic strategy, I think, and how to bring products to market.

PT: So under Hatch-Waxman we have this Paragraph IV patent challenge route, which often seems a logical route for a generics company to go down but there are some dangers with this approach. What would you say these dangers are?

PP: So when the ANDA applicant wants to file their application...they basically tell the FDA we don’t think that that patent either covers our drug or we think it’s invalid and shouldn’t be preventing access to the market for anybody. There are dangers to that strategy and the first one...is if you file a Paragraph IV certification you are required by the statute to notify the patent holder and the NDA holder that you are making a challenge. Once you send that letter you’ve no longer kept your application secret...and then probably the biggest concern is that it’s expensive and you’re launching basically inviting patent lawsuit. The whole process brings in a great deal of uncertainty in the entry date. If a lawsuit is filed it triggers a 30 month stay. What that means is that the FDA cannot approve the ANDA applicant’s application for at least 30 months, and that is started just by the brand pharmaceutical company filing a complaint. But aside from that...the other issue is that if you file a Paragraph IV certification there is likely to have been another company that has filed or will file and if you weren’t the first one to file or among the first wave, first day filers you will be subject to waiting for the first filer’s 180 days exclusivity. So the first filer gets six months of being the only approved ANDA and they can make a settlement with the brand and you have no control over that date. So it’s definitely a balance, it’s not always the most desired strategy for sure.

"...probably the biggest concern is that it’s expensive and you’re launching basically inviting patent lawsuit."

PT: Assuming a generics company is successful with a Paragraph IV patent challenge, what are the most common reasons you would see that they succeed in declaring a patent invalid?

PP: First of all, a successful challenge can be non-infringement...for complex formulation patents where the generic has found a way to formulate an extended release drug that can provide the same level of drug for 24 hours, they’ve been able to devise a technology that can achieve that delayed release profile without using the exact recipe that is in the patent that the brand used...but in terms of the declaration of invalid...we are getting cases that before would have been too close to call and now are falling over the line on being termed obvious. That just means that at the time the invention was made someone...put together different components that were known. And the other, I suppose not so invalid but it’s held unenforceable, in the US is that we have inequitable conduct and that means that in the process of getting the patent someone involved in that process, whether it’s an inventor or an attorney or an advisor, an expert asked to opine on the technology made a declaration that was considered fraud on the office.

PT: Now as with any legal area you tend to find that case law tends to shape the way that the landscape is defined, so just to briefly touch on some of the key case studies, if we look back over the last 10 to 20 years what would you say are the key case studies that have really shaped the way that both branded pharma and generics companies have defended or challenged products patents?

PP: So there have been some developments...that obviousness case where the Supreme Court in the US actually heard a patent case, which was rather unusual. Patent cases don’t usually rise to the level of meriting attention from the Supreme Court, and when the Supreme Court looked at the case law that had developed around how obviousness is determined they changed the standard...said you can’t have a hard and fast rule when it comes to a determination of what’s obvious or not...that really opened the door to evaluating and taking a new look at all our issued patents. That’s certainly how a lot of development is happening, and so the KSR case…the subject matter of that case was a gas pedal for a car, but it’s then the key piece of case law in the last ten years that has impacted our industry. Some of the others that I think we will be talking and seeing more on, most recently heard was Ariad versus Lilly, in that established a standard for the written description, which I think as we move into the biologics, and biopharmaceuticals it’s going to have a very large impact in that area.

PT: Two areas that you’re talking about are the use of authorised generics and reverse pay settlements. Can you just give a brief overview of what those strategies involve?

PP: So authorised generics is basically where the branded pharmaceuticals, when faced with generic competition, will take their same formulation and market it under their new drug application, their NDA, so it’s not a separate application, but they simply re-label it with a generic name and offer it at a price that competes with the ANDA approved generic. Sometimes they do that through their own distribution, but often times they’ll partner with a generic company and offer to basically say the same bottle off the same line but a different label and distribute it through the supply means that the generics typically use. What reverse pay settlements refers to is that...when there comes time to make a settlement the generic says, “I don’t think your patent covers my drug, I want to launch in 2010,” and the patent holder in the pharmaceutical space, or pharmaceutical company says, “My patent goes up to 2015, I don’t want you to come to the market until 2015.” They disagree, and the generic will say, “Well I’ll hold off coming to market until 2012, but I’m going to need some money to compensate me for my delay, because I think I should be able to come to market in 2010.” And so the branded pharmaceutical will pay the generic for part of that settlement, they’ll agree on a date in the middle, or somewhere before the patent expires and make a payment, and the reason would be called the reverse pay settlement is because the patent holder pays the accused infringer. And how those come together...is that the Federal Trade Commission has made a quite public and a purposeful agenda item that they think that the reverse pay settlements between generic and branded companies is anti-competitive, that it’s basically the market monopoliser paying proposed competition off, to stay off the market, so it ultimately hurts consumers.

"...the Federal Trade Commission has made a quite public and a purposeful agenda item that they think that the reverse pay settlements between generic and branded companies is anti-competitive..."

PT: When you look at this from a perspective of a generics company what would you say are the key factors to consider when you’re looking at the potential risk of a launch strategy for any individual product?

PP: Our key risks are the access to the market. There’s many ways in which our access to the market can be delayed or prevented entirely. The FDA, just absent any patent challenge, is taking longer and longer and longer to review ANDA applications and get them to tentative approval...and we’re seeing those companies that are able to get their ANDA application in early, they may be the first to file a patent challenge and so the presumed holder of the 180 day period of being the only generic on the market, we’re seeing a lot more concerns about this...those 180 days can be forfeited for a number of reasons. The big risk there is that you ultimately lose the patent challenge and you’d be subject to being on the hook for the lost profits of the brand, it’s not just what the generic company made off of their launch, but it’s what they cost the large pharma company, so that could be devastating to many of our generic companies.

PT: If you roll that up to a portfolio perspective...what role does the patent attorney play in really prioritising which generics to launch and where to focus?

PP: The patent attorney works carefully in understanding the business and every business has a different strategy in terms of what they’re trying to achieve with their portfolio...something that the patent attorney has to work really hard to accommodate, but they can also have some inner play in that. We can find opportunities and probably also be instrumental in discouraging certain proposals.

PT: One area that you mentioned earlier on is biopharmaceuticals...what opportunities do you see here for the generics companies that are willing to invest in the development of biogeneric or biopharmaceutical products?

PP: Well there’s a lot of opportunity. We don’t have a lot of history to go on, we can look to some other countries, there’s been a process that’s been happening in Europe, Japan and a little bit in Canada. The healthcare reform bill gave 12 years of data exclusivity for biopharmaceuticals, so I think what we’re going to see for the next several years is that this pathway probably won’t be exploited too much. Twelve years is a long time to wait and we’re already seeing traditional generic companies bringing biopharmaceuticals to the market, but they are using the traditional biologics licence application process...in a few years we’ll start to see some exploration on the abbreviated BLA...and once we see the first couple jump in you’re going to see the whole industry going there.

PT: Well Pam I’d just like to say it’s been a real pleasure talking to you today, I think you’ve gone into great detail into the world of generic patent strategies. I’m sure your presentation will be very well received at the marcus evans event on the 29th of June, so I just want to say thank you very much for your time.

PP: Well thank you so much Paul it was really a pleasure talking with you.

About the interviewee:

Pam Politis is a Senior Patent Attorney with Endo Pharmaceuticals, based in the US. She is presenting on the topic of “Mastering successful patent strategies to achieve profitable IP” at the marcus evans “3rd Annual Product and Pipeline Enhancement for Generics” conference in Washington, commencing June 28th.

For queries regarding this article please contact Michele Westergaard at marcus evans on michelew@marcusevansch.com.

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