A company that fears it will be sued for patent infringement can go to court and attempt to overturn the patent. But what if the company thinks the patent is unfair and doesn’t have reason to fear an infringement suit? That’s the key issue in MedImmune v Genentech-dismissed twice but alive again after the Supreme Court last week agreed to get involved. The suit could have major implications for how biotech licensing is handled in the United States.

    The high court will decide whether MedImmune has a right to sue Genentech over the validity of its “Cabilly” patent on a technology for manufacturing antibodies. (The patent was named for Shmuel Cabilly, the discoverer of the technology.) MedImmune claims that Genentech violated antitrust laws by colluding with UK-based Celltech R&D Ltd. to extend Cabilly’s life

    But the court will not determine this issue, explained Stephen Bent, partner at Foley and Lardner LLP’s Washington D.C. office. It will focus on the simple, but important, issue of whether MedImmune should even be allowed to sue Genentech.

    According to a 1969 Supreme Court decision, 

, a person or company using patented technology could sue the patent-holder if they thought they were at risk of being sued for infringement, Bent explained. 

    The catch is that even though MedImmune claims the patent is invalid, it continues to pay licensing fees for using the patented technique in the manufacture of its respiratory drug Synagis (palivizumab). As a result, two lower courts rejected the lawsuit, saying there was no threat.

 cases, the challenger-licensee was thrown out of court because he, unlike the licensee in Lear, continued to pay royalties under the license, seeking, in effect, to have his cake and eat it, too,” Bent said via email.

    The heart of the case is a constitutional issue, according to Ron Daignault, partner at Jenner & Block LLP’s New York office. Article III of the US Constitution, which establishes the role of the courts, states that the judicial system should only be used when there is an actual “controversy.” This is interpreted to mean that courts should not be called in as merely advisors when two parties are in disagreement, Bent explained. 

    If MedImmune breached the licensing agreement, then it would have an actual “controversy,” under the current interpretation, said Daignault. But because the company continues to pay royalties, there is no risk, and no controversy in the sense the Constitution intended.

    “Right now this keeps the court card out of the negotiation poker game,” Bent said.

    If the high court decides that MedImmune should be able to sue, it would allow companies to enter an agreement to use patented technology and at the same time challenge the validity of the patent, explained Tom Dewey, partner at Dewey Pegno and Kramarsky LLP.

    “If the Supreme Court reverses [the lower courts’ decisions], it will be a huge event,” Dewey said.

    Daignault said he could see no upside for patent-holders if MedImmune is granted the right to sue.

    It would probably shift the balance of power in licensing negotiations towards licensees, Bent said. This might encourage patent holders to settle disputes with terms they would not previously consider acceptable in order to stay out of court, he added.

    One potential result, according to Bent, would be a change in the base rates of royalty payments. Dewey agreed that this is a possibility.

    Either way, the court’s decision is unlikely to spur Congress to write new legislation, said Daignault.

Articles

The high court’s decision on this licensing dispute could have far-reaching implications for patent negotiations, legal experts say.

Supreme Court Will Decide if MedImmune Can Sue Genentech

Despite a surprise setback, Sanofi-Aventis still hopes to launch its eagerly awaited Acomplia (rimonabant) in the United States during the second half of 2006, company executives announced in an earnings call Friday.

    The announcement came a week after news that the Food and Drug Administration had delayed the approval of rimonabant for weight loss until certain conditions were met, and it issued a “non-approvable" letter for the drug in a second indication: smoking cessation.

    The French company is keeping the details close to its vest, but it did reveal that FDA’s Metabolism and Endocrinology division did not ask for any new trials in order to gain approval for the weight-loss indication-but that new trials would be required before the drug could be approved for smoking cessation.

    Industry analysts are still sorting out what this delay might mean, especially considering that drugs accounting for 40 percent of the company’s revenues will go off patent in the next five years.

    “It’s a little disappointing,” said Morningstar analyst, Tom D’Amore. “But there’s still a long road ahead.”

    D’Amore added that the “approvable” letter for obesity shows that there are no major problems or disqualifying side effects.

    But Amit Roy, Citigroup analyst, expressed skepticism about Acomplia in a Feb. 23 report. Roy cited concerns over psychiatric side-effects in the obesity trial published in the Feb. 17 issue of the 

Journal of the American Medical Association

    On the smoking side, Bear Stearns analyst Alexandra Hauber wrote in a Feb. 20 report that questions about the drug’s effectiveness seem unlikely.

    “It is difficult to say whether this points to a serious ‘absolute’ safety concern (regardless of clinical benefit), or the FDA is unhappy about the risk/benefit profile of Acomplia in smoking cessation,” Hauber wrote.

    On the other hand, Wood Mackenzie senior analyst Martyn Link said the delayed weight-loss approval might not be such a bad turn of events.

    “It may not be as negative as some people are thinking,” he said, noting the example of Ambien CR, which had a delayed approval, but debuted with a stronger label as a result.

    Link added that other companies developing drugs to help people lose weight or quit smoking would pay special attention to the regulatory back-and-forth about Acomplia. This is especially true for any company working on compounds targeting the cannabinoid type-1 receptor, since Acomplia is the first drug in that class.

    One potential beneficiary of Acomplia’s delayed entry into the anti-smoking arena is Pfizer, Link said. The company’s smoking-cessation drug Champix (varenicline) now might reach the market before Acomplia is approved for this secondary indication.

    Acomplia has been hailed as a potential blockbuster, partly on the strength of its usefulness in multiple indications. But in order to live up to that potential, says Hauber, it needs to win approval for additional indications, particularly diabetes treatment and cardiovascular risk prevention.

    Link agreed, noting that approval for weight-loss could serve as a platform to help Sanofi-Aventis launch Acomplia as a widely prescribed drug down the road.

    “Post-marketing studies will be essential to get the large sales Sanofi-Aventis will be looking for,” he said.

    If the drug is approved for obesity in 2006 and diabetes in 2007, sales could approach $892 million by 2010, according to Wood Mackenzie’s March 2006 Productview.

FDA pushed back the expected approval of this would-be blockbuster by giving manufacturer Sanofi-Aventis one ?approvable? letter and one non-approval. Analysts say the drug?s success depends on approval for more indications, and delay could give advantage to a competitor in the smoking-cessation category.

Acomplia Approval Delayed

Body weight may predict how a patient would respond to various asthma treatments, according to an analysis published in the March 1 issue of the 

    The analysis, which draws on data from three clinical trials of Merck’s Singulair (montelukast), provides some evidence that body mass index (BMI) could be used to predict a patient’s response to asthma drugs, according to lead author Marc Peters-Golden. But Peters-Golden, a professor of internal medicine at the University of Michigan's medical school, stressed that these results are preliminary, since the data were collected for a different purpose, and retrospectively analyzed.

    “It raises potential new ideas for future study,” he said. “But it does not have the same level of conclusiveness as a brand new study designed to look at this.”

    Nonetheless, the study may point to some important links between obesity and asthma.

    The results indicate that obese people may respond better to asthma drugs that act against leukotrienes, molecules associated with inflammation and airway constriction, Peters-Golden said. Lean people respond better to inhaled steroids, which act on a variety of inflammatory molecules, but don’t have much effect on leukotrienes, he added.

    This information fits in to the growing understanding that asthma can be caused by a variety of problems, Peters-Golden explained. It’s not really a single disease, but more of a “wastebasket term” for a variety of problems that result in airway constriction.

 analysis may provide a link in developing the theory that asthma in obese people is related to higher-than-normal levels of leukotrienes, Peters-Golden said. Fat cells produce a hormone called leptin, which inhibits the appetite and promotes inflammation, according to Peters-Golden. It can also increase production of leukotrienes.

    If this theory is correct, it could explain why leukotriene-blockers, such as montelukast, were more effective at combating asthma in obese people.

    “Based on all the pieces of the puzzle that we know about,” Peters-Golden theorized. “Perhaps asthma in obese people is particularly driven by leukotrienes.”

    Further study should measure levels of leptin and leukotrienes in patients with varying BMIs both before and after treatment with inhaled steroids and leukotriene-blockers, Peters-Golden said. The studies should also examine a variety of asthma drugs that act against leukotrienes, either by blocking receptors or inhibiting production, he added.

An analysis of Merck’s clinical trial data for Singular (montelukast) indicates that obese people may respond to asthma treatments differently than lean people. A University of Michigan professor explains his recently published paper.

Pharmaceutical Executive-02-28-2006

Supreme Court Will Decide if MedImmune Can Sue Genentech

Acomplia Approval Delayed

Weight May Influence Response to Asthma Treatments