PhRMA and BIO take legal action against Nevada law
Two biotech associations have filed litigation in a district court challenging the provisions of a Nevada law, saying it violates patent rights.
The Pharmaceutical Research and Manufacturers of America (PhRMA), which represents the country’s leading innovative biopharmaceutical research companies, and the Biotechnology Innovation Organisation (BIO), a trade association representing biotechnology companies, are the two groups involved.
SB 539, which was approved by the governor in June this year, infringes patent rights and counteracts trade secrets protection for designated diabetes medicine, the organisations claimed.
BIO and PhRMA brought the suit to “block an unprecedented and unconstitutional” law.
SB 539 “strips pharmaceutical manufacturers of trade secret protection for confidential, competitively sensitive, proprietary information regarding the advertising, cost, marketing, pricing, and production of their patented diabetes medicines”, according to the complaint.
PhRMA and BIO are also seeking an injunction preventing the implementation of some of the laws’ provisions.
The law violates the Takings Clause of the Fifth Amendment of the US constitution, which prohibits the government from taking property without just compensation, according to the associations. It also breaches the Commercial Clause of the US constitution, which prohibits Nevada from impeding commerce in other states, they said.
Tom DiLenge, BIO’s president for advocacy, said: “In 2016 more than 170 medicines for diabetes and related conditions were in development. The vast majority of these drugs are potentially ‘first-in-class medicines’ that offer a new approach to fighting a disease that afflicts millions across the United States.
“Nevada’s law is, in actuality, an attempt to set de facto price controls on the few successful products that do make it to market, and in doing so, it will chill the massive private investment needed to spur our amazing biomedical innovation ecosystem that is providing hope to patients in Nevada and throughout the world.”
James Stansel, PhRMA executive vice president, said: “If provisions of SB 539 go unchallenged, then Nevada’s law will conflict with, and in many cases override, federal law and the laws of 49 other states—laws that foster pharmaceutical innovation and protect IP and trade secrets. For this reason and others, provisions of SB 539 are unconstitutional and should not be implemented.”
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