GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc., 18-1976 (Fed. Cir. 2022)
Context: This is a case I have been personally following for a while because of its potentially substantial impacts on the pharmaceutical industry, particularly involving generics. In short, the drug cardevilol was unpatented, except for GSK’s patent for one particular use of the drug (treatment of congestive heart failure or “CHF”) under U.S. Patent Reissue No. 40,000 (“the ‘000 Reissue”). In 2002, Teva sought to release a generic version of cardevilol with a so-called “skinny label” which carved out GSK’s patented use of the drug. This version of the generic launched in 2007, but by 2011, the FDA required that Teva amend the skinny label to add back the patented use of the drug (“full label”).
Procedural History: GSK sued Teva for infringement of their patent, not only during the full label period, but even before 2011, during the skinny label period. GSK asserted an induced infringement theory in the lower court, and the jury found for GSK. However, Judge Stark reversed the jury decision, finding judgement as a matter of law for Teva. Judge Stark indicated that, despite evidence that physicians were prescribing the Teva generic for CHF, GSK failed to prove that Teva actually caused the physicians to do so.
GSK proceeded to appeal to the Federal Circuit, which reversed the lower court’s decision and found that substantial evidence supported the jury’s finding of induced infringement. Teva then requested en banc rehearing, arguing that this decision could be read to impose liability broadly on producers of generics, and defeat the purposes of skinny labels, in direct opposition to the purposes of the Hatch-Waxman Act. The Federal Circuit interpreted this request to also be a request for a panel rehearing, and this panel also found for GSK, indicating that GSK had provided substantial evidence that even the skinny label had directly encouraged the method of use of cardevilol for CHF in GSK’s patent. Teva now requests a full en banc hearing.
Claim 1 of the ‘000 Reissue is the representative claim here. It reads:
1. A method of decreasing mortality caused by congestive heart failure in a patient in need thereof which comprises administering a therapeutically acceptable amount of carvedilol in conjunction with one or more other therapeutic agents, said agents being selected from the group consisting of an angiotensin converting enzyme inhibitor (ACE), a diuretic, and digoxin,
wherein the administering comprises administering to said patient daily maintenance dosages for a maintenance period to decrease a risk of mortality caused by congestive heart failure, and said maintenance period is greater than six months.
The previous cases in this line of cases were met with great skepticism from the generic pharmaceuticals industry. In particular, amici raised serious issues with these rulings regarding when generics producers could be held liable for their products and the potential to “nullify” the Hatch-Waxman Act. In response, the Federal Circuit in its panel rehearing appeared to have attempted to narrow the impact of the ruling by focusing on what it deems to have been Teva’s failure to correctly exclude the patented use from its skinny label.
The en banc petition, along with the panel rehearing, raised an interesting issue, however. GSK was involved in the FDA process for issuing the skinny label, and GSK failed to name an indication (post-MI LVD) as being an infringing use. However, during trial, GSK asserted that post-MI LVD was, in fact, equivalent to the CHF that was recited in the ‘000 Reissue. The Court thus raised the issue of equitable estoppel, namely that GSK’s failure to prevent post-MI LVD from appearing on the skinny label resulted in the induced infringement, and thus GSK should be estopped on fairness principles from suing for this use.
Although Teva’s en banc hearing was denied here by the Federal Circuit, it appears that each of the Judges here have indicated some amount of support for this equitable estoppel position. Interestingly enough, the en banc hearing was denied at least in part because the concurrence asserts that Teva did not raise the equitable estoppel argument at the Federal Circuit – instead, these equitable estoppel issues are credited to the dissenting opinions[1]. Chief Judge Moore, however, states in the concurring opinion that “I too am concerned that GSK’s representations to the FDA are at odds with its enforcement efforts in this case. It would be troubling to hold Teva liable for relying on GSK’s representations to the FDA.” Chief Judge Moore notes that “[t]he dissents’ fairness concerns – which are limited to the [skinny] label period – track [the] three-element framework [for equitable estoppel] precisely.”
The dissent, written by Judge Prost, goes even further, indicating that not only does this case reveal an underlying conflict between the FDA regulatory framework and patent law, but that the Court here is abdicating its responsibilities by refusing to hear it. The dissent, in fact, refuses the equitable estoppel framework by stating that the facts are directed towards the issue of inducement of infringement, although it endorses the underlying argument itself.
There are two interesting takeaways from this decision. The first is that Teva, despite losing in its en banc petition, may ultimately win this case after all (at least on the issue of its skinny label). As noted in the concurrence, this equitable estoppel issue must now go back to the lower court for a decision, and each of the Judges here indicated support for the argument. The second is that producers of generics may indeed have some protection under the FDA framework for skinny labels. The persistent fear from generics has been that a producer like Teva could follow the FDA’s rules to attempt to not induce infringement through a skinny label and still be found liable in the end. If Teva ultimately wins this case on equitable estoppel, this should provide at least some relief to generics producers.
[1] Strangely enough, however, the majority opinion in the panel rehearing, which included Judge Moore, indicated that Teva had indeed raised an equitable estoppel issue at oral hearings, and expressed some amount of doubt about the success of such an argument