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25 August 2022FeaturesBig PharmaJeanna Wacker and Tasha Francis Gerasimow

Navigating the murky waters of the Hatch-Waxman ‘safe harbour’

The Hatch-Waxman “safe harbour” is a valuable tool for companies looking to develop FDA-regulated products based on existing patented inventions. But the boundaries surrounding the safe harbour are not always so clear. Here, we’ll dive into the statutes and recent case law surrounding the provision to shed some light on its contours.

What is the safe harbour provision?

The safe harbour provision, codified in 35 USC §271(e)(1), was introduced in 1984 as part of the Hatch-Waxman Act. It provides: It shall not be an act of infringement to make, use, offer to sell, or sell within the US or import into the US a patented invention […] solely for uses reasonably related to the development and submission of information under a federal law which regulates the manufacture, use, or sale of drugs or veterinary biological products.

Courts have interpreted the purpose of the safe harbour provision as correcting an “unintended distortion” in the effective patent term of certain products due to FDA pre-approval requirements (Eli Lilly and Co v Medtronic (1990) [Eli Lilly]).

Prior to the Hatch-Waxman Act, it would be an act of infringement to manufacture, use or sell a patented invention, including for the purpose of conducting the research or testing required for FDA approval.

As a result, competitors would have to wait until the patent term expired before initiating the regulatory process, which could take several more years. This resulted in a “de facto extension of effective patent life at the end of the patent term” which the safe harbour provision was designed to correct (REGENXBIO v Sarepta Therapeutics (2022)).

What does the safe harbour protect?

The Supreme Court has stated that the safe harbour provision provides a “wide berth” for the use of patented drugs in activities related to regulatory approval (Merck v Integra Life Sciences I(2005) [Merck I]). However, there are two key phrases in the provision which have been subject to significant debate. The first is the definition of “patented invention” and the second is the scope of “reasonably related uses.”

What is a ‘patented invention’?

At first glance, the term “patented invention” seems to cover any patented invention that could be used in activities relating to FDA approval. However, it’s not quite so simple. In early cases invoking the safe harbour provision, there was some confusion as to whether the term “patented invention” included only drugs, or also other products subject to regulatory approval.

This debate was cleared up in Eli Lilly, where the Supreme Court held that the phrase “patented invention” includes drugs, but also medical devices, food additives, and colour additives.

A second point of contention revolves around whether the use of patented “research tools” used in activities necessary for FDA approval are protected under the safe harbour. “Research tools” refers to the “tools that scientists use in laboratory including cell lines, monoclonal antibodies, […] methods, laboratory equipment and machines” (Integra Lifesciences I v Merck (Fed Cir, 2007) [Merck II]).

The Federal Circuit examined the scope of protection for research tools in Proveris Sci v Innovasystems (Fed Cir 2008). The key question was whether Innova’s sale of allegedly infringing Optical Spray Analyzers (a “research tool”) to third parties solely for the development and submission of information to the FDA was covered under the safe harbour provision.

The court held that it was not, reasoning that “because the OSA device is not subject to FDA premarket approval, […] Innova is not a party who, prior to the enactment of the Hatch-Waxman Act, could be said to have been adversely affected by the [distortion that the safe harbour provision was designed to address]” (Proveris Sci v Innovasystems (Fed Cir, 2008) [Proveris]).

Other courts have since reached the same decision, finding research tools excluded from the safe harbour exemption. For example, PSN Illinois v Abbott Lab’ys (2011), found that “only ‘patented inventions’ for which regulatory approval is required fall within the scope of the safe harbour exemption”.

Similarly, in Allele Biotechnology & Pharms, v Pfizer (2021), the court found that the use of a patented probe to evaluate COVID-19 neutralising antibody levels was not protected because the probe itself was not subject to FDA premarket approval, although it was used in the development of FDA regulatory submissions relating to the COVID-19 vaccine.

The court in REGENXBIO (2022) also adopted this reasoning, holding that Sarepta’s use of patented cultured hosts cells to make rAAV gene therapy products was not protected by the safe harbour.

An opposing view emerged in Teva Pharms USA v Sandoz (2013) where the court held that the use of patented molecular markers and methods which were not themselves subject to FDA approval but were used as “research tools” in the development of FDA submissions for their generic glatiramer acetate products were covered under the safe harbour.

In coming to this conclusion, the court read Proveris as being limited to the facts of that case – where the defendant is actively commercialising the infringing product.

Given this backdrop, entities should be aware that research tools used during the development of FDA approval do not automatically qualify for safe harbour protection, though the specific facts of the case may allow for some protection.

What are “reasonably related uses”?

Generally, courts have found that an activity is “reasonably related” to federal regulatory activities if “an accused manufacturer has a reasonable basis for believing that a device may work to achieve a particular result, and uses the device in research that, if successful, would be appropriate to include in a submission to the FDA” (Edwards Lifesciences v Meril Life Scis (2020).

Courts have found activities reasonably related to federal regulatory activities regardless of the phase of research, including preclinical studies.

However, “basic scientific research, performed without the intent to develop a particular drug or a reasonable belief that the compound will cause the sort of physiological effect the researcher intends to induce” are not reasonably related.

For example, in Isis Pharms v Santaris Pharma, (2014), the court held that Santaris’ use of patented methods to identify targets or screen molecules for activity (using antisense technology) was not protected because Santaris had not shown “a reasonable basis for believing” that the antisense compounds in its libraries would have a particular biological effect through a particular biological process”.

At the other end of the regulatory timeline, courts have held that the safe harbour can cover certain post-FDA approval activities. In two cases involving Classen Immunotherapies, the Federal Circuit held that the safe harbour provision does not apply to “routine” post-approval submissions to the FDA (Classen Immunotherapies v Biogen (2011) [Classen I]) but does apply to “non-routine” activities conducted to satisfy specific FDA requirements  (Classen Immunotherapies v Elan Pharms (2015) [Classen II]).

For example, in Classen II, the use of a patented method in research submitted to the FDA to obtain a labelling change was protected by the safe harbour. In contrast, “routine” quality control testing was not protected in Momenta Pharms v Teva Pharms (2015).

Who is eligible?

Another open question around the safe harbour provision is whether it extends to third parties that are not the entity seeking FDA approval. In Shire v Amneal Pharm (Fed Cir, 2015), the safe harbour was found to protect third parties supplying the active pharmaceutical ingredient to generic filers developing products for FDA approval.

On the other hand, you may recall that the Federal Circuit in Proveris had denied protection for a third party supplying a research tool to be used for the development and submission of information to the FDA.

A reasonable conclusion to draw from these cases is that the protection may depend on whether the product supplied qualifies as a “patented invention”.  Thus, ambiguity remains for CROS and other third parties that may seek to utilise the safe harbour provisions.

How and where can it be used?

In Amgen v Int’l Trade Comm (Fed Cir, 2009), the Federal Circuit confirmed that the safe harbour provision applies not only to district court infringement proceedings but also to ITC proceedings relating to infringement of process and product patents.

The provision offers an affirmative defence: even if a plaintiff is able to establish infringement apart from the safe harbour; the defendant can defeat this by introducing evidence showing that the safe harbour applies (Allele Biotechnology & Pharms v Pfizer (2021)).

Conclusion

The safe harbour provisions remain a robust defence for patent infringement allegations, but the boundaries of the defence are still being actively litigated and defined.

Thus, parties seeking to use or defeat such a defence are advised to critically analyse the facts of the case in light of these open questions surrounding the safe harbour protections.

Jeanna Wacker is a partner at Kirkland & Ellis. She can be contacted at:  jeanna.wacker@kirkland.com

Tasha Francis Gerasimow is a partner at Kirkland & Ellis. She can be contacted at:  tasha.francis@kirkland.com


More on this story

Americas
6 January 2022   Sarepta Therapeutics won’t be able to rely on a “safe harbour” provision to protect its gene therapy invention from a patent infringement suit from biotech Regenxbio and the University of Pennsylvania, a Delaware court has ruled.
Americas
5 January 2021   One of the architects of the Hatch-Waxman Act has urged judges to reverse a decision which he says nullifies a key provision of the generic drug legislation.
Generics
18 July 2023   Generic drug makers are watching two cases that will determine whether pharmaceutical firms can deduct—rather than capitalise—legal fees for defending against patent infringement suits, say Carina Federico and Anne Li of Crowell & Moring.

More on this story

Americas
6 January 2022   Sarepta Therapeutics won’t be able to rely on a “safe harbour” provision to protect its gene therapy invention from a patent infringement suit from biotech Regenxbio and the University of Pennsylvania, a Delaware court has ruled.
Americas
5 January 2021   One of the architects of the Hatch-Waxman Act has urged judges to reverse a decision which he says nullifies a key provision of the generic drug legislation.
Generics
18 July 2023   Generic drug makers are watching two cases that will determine whether pharmaceutical firms can deduct—rather than capitalise—legal fees for defending against patent infringement suits, say Carina Federico and Anne Li of Crowell & Moring.