Amicus Curiae Brief — Thryv, Inc., fka Dex Media, Inc., Petitioner v. Click-To-Call Technologies, LP, et al.

Supreme Court briefFeb 13, 2019

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No. 18-916

IN THE

Supreme Court of the United States

__________________________________________

DEX MEDIA, INC.,

Petitioner,

CLICK-TO-CALL TECHNOLOGIES, LP,

AND

ANDREI IANCU, UNDER SECRETARY OF COMMERCE FOR

INTELLECTUAL PROPERTY AND DIRECTOR OF THE UNITED

STATES PATENT AND TRADEMARK OFFICE,

Respondents.

__________________________________________

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

______________________________

BRIEF OF AMICUS CURIAE THE ASSOCIATION

FOR ACCESSIBLE MEDICINES IN SUPPORT OF

THE PETITION FOR CERTIORARI

______________________________

JEFFREY K. FRANCER

ASSOCIATION FOR

ACCESSIBLE MEDICINES

601 New Jersey Ave.,

N.W., Suite 850

Washington, D.C. 20001

WILLIAM A. RAKOCZY

Counsel of Record

LARA E. FITZSIMMONS

TRANG H. LIN

CHRISTOPHER P. GALLIGAN

RAKOCZY MOLINO

MAZZOCHI SIWIK LLP

6 W. Hubbard St.,

Suite 500

Chicago, IL 60654

(312) 527-2157

wrakoczy@rmmslegal.com

TABLE OF CONTENTS

TABLE OF AUTHORITIES ....................................... iii

INTEREST OF THE AMICUS CURIAE..................... 1

SUMMARY OF ARGUMENT ...................................... 2

ARGUMENT ................................................................ 7

THIS CASE PRESENTS AN

OPPORTUNITY FOR THIS COURT TO

CORRECT A HIGHLY PREJUDICIAL

AND INCORRECT RULING THAT WILL

RESULT IN HARMFUL AND COSTLY

CONSEQUENCES TO IPR PETITIONERS

AND PATIENTS IN THE U.S. ......................... 7

Generic and Biosimilar Medicines

Save Money and Improve Patient

Access to Critical Therapies.................... 7

IPR Is A Critical Tool For Clearing

The Patent Thickets Used To Protect

Brand-Name Product Monopolies. ....... 10

The Federal Circuit’s En Banc

Decision Leads To Absurd And

Prejudicial Results. ............................... 13

The Federal Circuit’s Decision

Provides an Incentive and

“Mechanism for

Manipulation.”............................ 13

The En Banc Decision Would

Have Drastic Unintended

Consequences On Generic And

Biosimilar Companies And

Patients....................................... 17

II.

SECTION 315(b) SHOULD NOT BE

INTERPRETED IN A WAY THAT

DEFEATS THE PURPOSE AND

STRUCTURE OF THE STATUTE. ................ 20

CONCLUSION ........................................................... 24

iii

TABLE OF AUTHORITIES

Federal Cases

Apple Inc. v. Rensselaer Polytechnic Inst.,

No. IPR2014-00319, 2014 WL 2735064

(P.T.A.B. Jun. 12, 2014) ..................................15

Cabell v. Markham,

148 F.2d 737 (2d Cir. 1945) .............................23

Food & Drug Admin. v. Brown & Williamson

Tobacco Corp.,

529 U.S. 120 (2000).................................... 20, 21

FTC v. AbbVie Inc.,

No. 14-cv-05151, 2017 WL 4098688

(E.D. Pa. Sept. 5, 2017) ...................................16

Graves v. Principi,

294 F.3d 1350 (Fed. Cir. 2002) ........................15

Kasten v. Saint-Gobain Performance Plastics

Corp.,

563 U.S. 7 (2011)..............................................23

King v. Burwell,

135 S. Ct. 2480 (2015)......................................20

Macauto U.S.A. v. BOS GmbH & KG,

No. IPR2012-00004, 2013 WL 5947694

(P.T.A.B. Jan. 24, 2013) ...................................15

Oracle Corp. v. Click-to-Call Techs. LP,

IPR2013-00312, 2013 WL 11311788

(P.T.A.B. Oct. 30, 2013) ...................................15

Public Citizen v. United States Dep’t of Justice,

491 U.S. 440 (1989)..........................................23

Util. Air Regulatory Grp. v. EPA,

573 U.S. 302 (2014)..........................................20

Federal Statutes

28 U.S.C. § 1295(a)(4) .............................................6

35 U.S.C. § 141(c) ..................................................11

35 U.S.C. § 314(a)..................................................16

35 U.S.C. § 315(b)....................................................3

35 U.S.C. § 316(a)(11) ...........................................11

35 U.S.C. § 319 ......................................................11

35 U.S.C. § 6 ..........................................................11

Pub. L. No. 112-29, § 6, 125 Stat. 284 (2011) .......10

Other Authorities

Andrew Pollack,

Makers of Humira and Enbrel Using New

Drug Patents to Delay Generic Versions,

N.Y. Times, July 15, 2016 ...............................11

ASS’N FOR ACCESSIBLE MEDICINES, GENERIC

DRUG ACCESS & SAVINGS IN THE U.S. (2017) .....9

ASS’N FOR ACCESSIBLE MEDICINES, GENERIC

DRUG ACCESS & SAVINGS IN THE U.S.:

ACCESS IN JEOPARDY (2018) ....................... 7, 8, 9

Carl Shapiro,

Navigating the Patent Thicket: Cross

Licenses, Patent Pools, and Standard

Setting, 1 INNOVATION POL’Y & ECONOMY

119 (2001) ...........................................................4

I-MAK, OVERPATENTED, OVERPRICED: HOW

EXCESSIVE PHARMACEUTICAL PATENTING IS

EXTENDING MONOPOLIES AND DRIVING UP

DRUG PRICES (2018) .........................................10

Jacob S. Sherkow,

Protecting Products Verses Platforms,

34 NATURE BIOTECHNOLOGY 462 (2016) ..........18

Jonathan J. Darrow et al.,

The Generic Drug Industry Embraces a

Faster, Cheaper Pathway for Challenging

Patents, 17 APPLIED HEALTH ECONOMICS &

HEALTH POLICY 47 (2019) ................................12

JULIETTE CUBANSKI & TRICIA NEUMAN,

KAISER FAMILY FOUNDATION, THE FACTS ON

MEDICARE SPENDING AND FINANCING (2018) .....9

Peter Olson & Louise Sheiner,

The Hutchins Center Explains: Prescription

Drug Spending, BROOKINGS INST.

(Apr. 26, 2017) ..................................................9

Press Release, Food & Drug Admin.,

Remarks from FDA Commissioner Scott

Gottlieb, M.D., as prepared for delivery at

the Brookings Institution on the release of

the FDA’s Biosimilars Action Plan

(Jul. 18, 2018) ..................................................10

U.S. FOOD & DRUG ADMIN., Generic

Competition and Drug Prices

(Nov. 28, 2017) ...................................................8

U.S. PATENT & TRADEMARK OFFICE, CHAT WITH

THE CHIEF: ORANGE BOOK-LISTED PATENT

STUDY (Mar. 2018) ...........................................12

Legislative Materials

157 CONG. REC. S1349 (Mar. 8, 2011) ...................11

157 CONG. REC. S5409 (Sept. 8, 2011) ..................11

157 CONG. REG. S5429 (Sept. 8, 2011)............ 21, 22

H.R. REP. NO. 112-98, pt. 1 (2011) ........................21

INTEREST OF THE AMICUS CURIAE1

The Association for Accessible Medicines (“AAM”)

is a nonprofit, voluntary association representing the

interests of the leading manufacturers of generic and

biosimilar medicines in the United States. Its

members provide Americans with generic and

biosimilar medicines that are as safe and effective as

their brand-name counterparts, but are substantially

more affordable.

In 2017, generic medicines

accounted for 90% of all prescriptions dispensed in

the United States but only 23% of total spending.

Generic medicines saved patients, taxpayers, and

health care payers over $265 billion in 2017

compared to their brand-name counterparts.

AAM seeks to provide courts with the perspective

of the generic and biosimilar pharmaceutical

industry on important legal issues impacting its

members, and to highlight the potential industrywide consequences of significant pending cases.

AAM’s members frequently participate in

pharmaceutical patent litigation, at times involving

dozens of patents purportedly protecting a single

1 Pursuant to Supreme Court Rule 37.2(a), AAM certifies that

all parties have consented to this filing and that notice was

provided at least ten days prior to filing. Pursuant to Rule 37.6,

AAM certifies that no counsel for any party authored this brief

in whole or in part, and no party, counsel for any party, or

person other than amicus curiae or its counsel made a

monetary contribution to preparing or submitting this brief.

pharmaceutical product.

Relevant here, AAM’s

members also frequently take advantage of the inter

partes review (“IPR”) process, because the efficiency

and speed of IPRs fit, and indeed further, the

industry’s mission of delivering generic and

biosimilar alternatives to brand-name products to

patients as soon and as cost-effectively as possible.

Limiting access to this critical administrative

tool—as the Federal Circuit’s decision below does

here—reduces the opportunity for AAM’s members to

cancel improperly issued patents that undermine the

legitimacy of the patent system, stifle competition,

and impede consumers’ access to lower-cost

medicines. AAM’s members thus have a significant

interest in ensuring that unnecessary restraints are

not improperly read into the IPR process, making it

impossible for its members—and patients—to take

advantage of this efficient patent challenge

mechanism for both current and future drug

products.

SUMMARY OF ARGUMENT

AAM supports Petitioner’s challenge to the

Federal Circuit’s en banc decision, holding that the

one-year bar in Section 315(b) applies to a patent

infringement complaint that was dismissed without

AAM will not repeat Petitioner’s

prejudice.2

arguments on the merits of that decision. AAM

submits this brief instead to highlight the

2 AAM takes no position on Petitioner’s arguments with respect

to Wi-Fi One.

anticompetitive and unintended consequences of

ignoring the fundamental purpose behind the oneyear bar and extending that bar to voluntarily

dismissed actions, particularly as they would play

out as a result of a brand-name company’s tactics to

block competition from generic and biosimilar

medicines.

IPR plays an important role in the

pharmaceutical industry, for both traditional generic

and biosimilar medicines. Congress created the IPR

process to serve as an efficient and effective

mechanism for the United States Patent and

Trademark Office (“PTO”) to reconsider its prior

patentability decisions with input from interested

third parties. Congress knew that many of the

patents subject to challenge through the new IPR

procedure would also be subject to ongoing or future

patent infringement actions. Congress thus sought

to reduce duplicative proceedings where district

court

litigation

was

long-underway,

while

simultaneously ensuring that IPR petitioners had

the benefit of understanding the patent claims at

issue in the litigation before filing an IPR. Balancing

these

interests,

Congress

gave

prospective

petitioners one year after being served with a

complaint to identify the patents most relevant and

best suited for an IPR challenge and to file an IPR

petition. 35 U.S.C. § 315(b).

Just as Congress intended, AAM’s members

frequently invoke the IPR pathway to clear “patent

thickets” protecting brand-name products.3 Sponsors

of brand-name pharmaceutical products are

notorious for patenting every conceivable aspect of

their products, from the manufacturing process to

the formulation, to each and every approved use,

including even minor, non-innovative changes to

each. This, of course, includes classic “evergreening”

strategies to pursue patents on trivial or nontherapeutic changes to an existing drug product, all

with the ultimate goal of preventing lower-cost

competition with the brand-name drug. Moreover,

pharmaceutical patents are commonly asserted with

respect to multiple drug products—including line

extensions and other products covered by the same

platform technology. It is often difficult to know

(especially in the biologic and biosimilar space)

which patents will be asserted with respect to any

particular product. For any or all of these reasons,

IPR is a critical tool in the arsenal of generic and

biosimilar companies for knocking out improperly

granted patents that never should have issued in the

first place, and which block more affordable

competition.

3 The term “patent thicket” is often used to describe an overlap-

ping set of patents rights covering a single product—a strategy

that increases litigation and development costs for would-be

competitors. See, e.g., Carl Shapiro, Navigating the Patent

Thicket: Cross Licenses, Patent Pools, and Standard Setting, 1

INNOVATION POL’Y & ECONOMY 119, 120-21 (2001) (describing a

patent thicket as “a dense web of overlapping intellectual property rights that a company must hack its way through in order

to actually commercialize new technology”).

The Federal Circuit’s en banc decision will

inevitably constrain the rights of generic and

biosimilar companies to use the IPR process to clear

the pathway to market.

The en banc court

interpreted the time bar under 35 U.S.C. § 315(b) to

prohibit a company that has been sued for patent

infringement from filing an IPR after one year has

passed from the date the complaint was served, even

when that suit is dismissed voluntarily without

prejudice.

The anticompetitive and unintended

consequences of this decision are manifest.

First, as Judge Dyk (joined by Judge Lourie) aptly

recognized in the dissenting opinion, the decision

provides an obvious mechanism for manipulation.

That is, patent owners are now incentivized to file

suit and voluntarily dismiss the complaint after

service in order to start the one-year clock, which

continues to tick even when the litigation is no

longer pending. This, in turn, forces the defendant

to use its IPR rights or forfeit them forever. It is an

understatement to say, as Judge Dyk observed, that

Congress could not have intended to provide a

mechanism for such manipulation.

Second, even beyond the recipe for such

gamesmanship, the unintended consequences of the

en banc decision for the generic and biosimilar

industries are startling. For many pharmaceuticals,

patents often cover multiple brand-name products—

this is especially true for biologics. In the event of a

voluntary dismissal, a generic or biosimilar company

must now decide whether to file an IPR against the

dismissed patents to avoid losing that option

altogether—not only for the medicine at issue in that

particular case, but for all future products that might

be covered by those patents, including products not

yet in development.

Once again, this absurd

interpretation results in unnecessary forfeiture of

critical IPR rights that could block patient access to

more affordable medicines and is inconsistent with

the statutory structure and purpose and could not

possibly have been what Congress intended.

In short, taking the IPR arrow out of the quivers

of generic and biosimilar companies in these

circumstances could have disastrous consequences

for patients, healthcare payers, and taxpayers who

rely on generic and biosimilar drug companies to

provide safe and lower-cost alternatives to brandname medicines.

AAM thus respectfully urges this Court to grant

Petitioner’s petition and review the Federal Circuit’s

en banc decision. Because the Federal Circuit has

exclusive jurisdiction over these disputes, no other

court of appeals will have an opportunity to correct

this prejudicial ruling. 28 U.S.C. § 1295(a)(4). And

unless Section 315(b) is given its proper reading, the

harm to generic and biosimilar pharmaceutical

companies and to patients will be immediate and

costly.

ARGUMENT

I. THIS CASE PRESENTS AN OPPORTUNITY

FOR THIS COURT TO CORRECT A HIGHLY

PREJUDICIAL AND INCORRECT RULING

THAT WILL RESULT IN HARMFUL AND

COSTLY

CONSEQUENCES

IPR

PETITIONERS AND PATIENTS IN THE U.S.

Generic and Biosimilar Medicines

Save Money and Improve Patient

Access to Critical Therapies.

Manufacturers of generic drugs have long ensured

affordable access to medicines for millions of

American consumers.

Taxpayers, employers,

insurance companies, and state and federal

governments have benefited from trillions of dollars

in savings from lower-cost alternatives to brandname medicines. Biosimilar manufacturers are now

starting to add to that considerable savings.

The principal difference between generic or biosimilar medicines and brand-name prescription drugs

or biologic products is cost.4 Generics account for

90% of prescriptions dispensed in the United States,

but only 23% of total drug costs.5 In total, generic

medicines generated $265.1 billion in savings for the

4 ASS’N FOR ACCESSIBLE MEDICINES, GENERIC DRUG ACCESS &

SAVINGS IN THE U.S.: ACCESS IN JEOPARDY 24 (2018) (“GENERIC

DRUG ACCESS 2018”).

5 Id. at 10.

American healthcare system in 2017, and $1.79

trillion in savings over the last decade.6

But the benefits of more affordable generic and

biosimilar medicines extend beyond mere cost

savings. Generic drugs reduce the problem of lack of

adherence because new patients are three times

less likely to stop taking generic medications than

brand-name drugs.7

All of these benefits flow directly from the

competition that generic and biosimilar medications

provide to brand-name drugs that would otherwise

enjoy monopoly status.

The more competitors

there are, the greater the savings: The entry of a

second generic manufacturer into the market

reduces the average generic price to nearly half the

brand-name price, and for medicines that attract a

large number of generic manufacturers, the average

generic price falls to less than 20% of the branded

price.8

Not only is the generic marketplace good for

patients, but it benefits taxpayers, too. Although

brand-name drugs account for only around 10% of

prescriptions dispensed in the U.S., they account for

6 Id. at 11.

7 Id. at 16.

U.S. FOOD & DRUG ADMIN., Generic Competition and Drug

Prices (Nov. 28, 2017), https://www.fda.gov/AboutFDA/CentersO

ffices/OfficeofMedicalProductsandTobacco/CDER/ucm129385.ht

more than 75% of total drug spending.9 One of the

largest subsidizers of pharmaceutical prescriptions

is the federal government, which contributes more

than $70 billion dollars annually to subsidize

Medicare Part D premiums.10 In 2015, the U.S.

government paid roughly 43% of all retail

prescription drug costs—29% through Medicare and

10% through Medicaid.11 Medicare and Medicaid

saved $82.7 billion and $40.6 billion, respectively,

in 2017 due to savings associated with lower-cost,

generic drug options.12 This equates to an average

annual savings of $1,952 per Medicare enrollee and

$568 per Medicaid enrollee.13

With health

expenditures climbing 5.8% in 2015 and accounting

for 17.8% of Gross Domestic Product, the savings

associated with generic drug options has become an

indispensable component of national health

policy.14

9 GENERIC DRUG ACCESS

2018 at 10.

See JULIETTE CUBANSKI & TRICIA NEUMAN, KAISER FAMILY

FOUNDATION, THE FACTS ON MEDICARE SPENDING AND

FINANCING 6 (2018).

11 Peter

Olson & Louise Sheiner, The Hutchins Center

INST.

Explains: Prescription Drug Spending, BROOKINGS

(Apr. 26, 2017), https://www.brookings.edu/blog/up-front/2017/

04/26/the-hutchins-center-explains-prescription-drug-spending/.

12 GENERIC DRUG ACCESS 2018 at 4.

13 Id.

14 ASS’N FOR ACCESSIBLE MEDICINES, GENERIC DRUG ACCESS &

SAVINGS IN THE U.S. 8 (2017).

IPR Is A Critical Tool For Clearing

The Patent Thickets Used To Protect

Brand-Name Product Monopolies.

Before a generic or biosimilar product can enter

the market and start saving patients and payers

money, it often must cut through a patent thicket

protecting the brand-name company’s monopoly.15

One way is through costly and time-consuming

patent litigation. But litigation often takes several

years and several millions of dollars to resolve.

Another way is through the IPR process created by

Congress in the America Invents Act (“AIA”). Pub.

L. No. 112-29, § 6, 125 Stat. 284, 299-305 (2011).

Consistent with Congressional intent, IPRs have

become a critical tool for clearing away brand-name

drug and biologic patents that never should have

issued and that unnecessarily delay lower-cost

generic and biosimilar competition.

The IPR pathway was designed “to ensure that

the poor-quality patents can be weeded out through

administrative review rather than costly litigation”

to “improve patent quality and limit unnecessary

Press Release, Food & Drug Admin., Remarks from FDA

Commissioner Scott Gottlieb, M.D., as prepared for delivery at

the Brookings Institution on the release of the FDA’s Biosimilars Action Plan (Jul. 18, 2018); (acknowledging that brandname companies commonly use patent thickets to discourage

competition and raise the overall cost of entering the market);

see also I-MAK, OVERPATENTED, OVERPRICED: HOW EXCESSIVE

PHARMACEUTICAL PATENTING IS EXTENDING MONOPOLIES AND

DRIVING UP DRUG PRICES 6 (2018) (finding brand-name companies for the top 12 grossing drugs of 2017 have sought on average 38 years of patent protection to block generic competition).

and counterproductive litigation costs.”16 Indeed, the

IPR process offers many advantages over litigation.

For one, Congress designed the IPR process to be fast

and efficient. The statute requires the Patent Trial

and Appeal Board (“PTAB”) to complete an IPR

within 12 months of institution, absent good cause.

35 U.S.C. § 316(a)(11). The PTAB’s final decision is

reviewable solely by the Federal Circuit. 35 U.S.C.

§§ 319, 141(c). Further, IPRs are overseen by a

panel of at least three PTAB members—senior

personnel required by law to be qualified in both

“legal knowledge and scientific ability.” 35 U.S.C.

§ 6. In short, IPRs serve a distinct and crucial role in

a healthy patent system, allowing the PTO to take a

second look at its patentability decision.

IPRs are particularly important in the

pharmaceutical and biologic context, where brandname companies routinely seek dozens, if not

hundreds, of patents covering a single brand-name

drug or biologic and use second-, third-, and even

fourth-generation patents to extend a monopoly.17

What’s more, IPRs are working as intended to knock

out blocking pharmaceutical patents that never

16 157 CONG. REC. S5409 (daily ed. Sept. 8, 2011) (statement of

Sen. Schumer); 157 CONG. REC. S1349 (daily ed. Mar. 8, 2011)

(statement of Sen. Leahy).

17 See, e.g., Andrew Pollack, Makers of Humira and Enbrel

Using New Drug Patents to Delay Generic Versions, N.Y. Times,

July 15, 2016, https://nyti.ms/2kUxW18 (noting that the

manufacturer of Humira “amassed more than 70 newer

patents, mostly in the last three years, covering formulations of

the drug, manufacturing methods and use for specific

diseases”).

should have issued in the first place. In the smallmolecule context alone, the PTO reports that 66% of

IPRs challenging Orange Book18 patents are

instituted, with 49% of those IPRs resulting in final

written decisions finding at least one claim

unpatentable.19 In fact, according to a recent study,

between September 2012 and April 2017, generic

drug manufacturers used the IPR process to

challenge 198 patents covering 134 different drugs

and, in 43% of the cases, generic drug makers

succeeded in canceling all patent claims that were

challenged.20 All told, many decades of patent life

that never should have blocked competition in the

first instance have been eliminated, paving the way

for more affordable medicines.

Extending Section 315(b)’s one-year bar to

petitioners whose suits have been voluntarily

dismissed will take away their option to use this

valuable tool for patents that may cover a number of

different products. The harm will be felt not only by

generic and biosimilar companies, but also by

patients, who rely on such challenges to lower prices.

18 The “Orange Book” is an FDA publication that, among other

things, lists patents that purportedly cover and protect a brandname drug.

19 U.S. PATENT & TRADEMARK OFFICE, CHAT WITH THE CHIEF:

ORANGE BOOK-LISTED PATENT STUDY 43, 45 (Mar. 2018).

20 Jonathan J. Darrow et al., The Generic Drug Industry

Embraces a Faster, Cheaper Pathway for Challenging Patents,

17 APPLIED HEALTH ECONOMICS & HEALTH POLICY 47, 50-51

(2019).

The Federal Circuit’s En Banc

Decision Leads To Absurd And

Prejudicial Results.

The Federal Circuit’s en banc decision has the

very real potential to have a disparate impact on

generic and biosimilar companies given the sheer

volume of patents that purportedly protect brandname products, and will inevitably lead to absurd

results. On the one hand, the decision provides a

recipe for overt manipulation by patent owners. But

even beyond that, the natural and unintended

consequences of the en banc decision would likely be

just as severe, due to the regular overlap of patents

covering multiple products.

1. The Federal Circuit’s Decision

Provides

Incentive

and

“Mechanism for Manipulation.”

As observed in the dissenting opinion, the Federal

Circuit’s en banc decision opens the door to, and

indeed incentivizes, manipulation by patent owners

who may seek to bar future IPR challenges by

filing—and then dismissing—suits after serving the

complaint. App. at 105a-106a. Judge Dyk explained:

Finally, the purposes of section

315(b) will be defeated if the

patentee plaintiff is allowed to

manipulate

the

filing

infringement actions in order to bar

a future IPR challenge. Indeed, if

dismissals without prejudice did not

nullify the underlying complaint, patent

owners would have an incentive to file

suits

alleging

infringement

and

subsequently voluntarily dismiss these

suits without prejudice after service of

the complaint.

Such actions would

effectively begin the one year clock for

the accused infringer to file an IPR,

even where there was no longer an

underlying

infringement

action.

Congress could not have intended to

provide a mechanism for such

manipulation.

App. at 105a-106a (emphasis added).

There are, in fact, any number of ways in which

such manipulation could play out. A patent owner

could, for example, serve a complaint alleging

infringement of several patents purporting to cover

the brand-name company’s reference biologic

product, only to voluntarily dismiss some, if not all,

of the patents shortly thereafter to start the clock

running. The dismissal then leaves the biosimilar

sponsor guessing which, if any, of the patents could

be asserted later, and whether to expend the money

and resources now to challenge such patents in an

IPR. The clock, moreover, is also running for future

products that might be implicated by those same

patents, thereby substantially increasing the penalty

to any defendant who fails to invoke IPR. Patent

owners could make the decision even harder by

purposefully waiting to dismiss their patent claims

until a date nearing the end of the one-year period,

effectively eliminating IPR as a viable option

altogether.

Judge Taranto, in his concurrence, dismissed this

possibility as “purely hypothetical,” having been

presented with no evidence of this occurring. App. at

89a. But that is no surprise. Until the decision

below, all parties and the Board operated on the

principle that suits that had been voluntarily

dismissed did not, in fact, trigger the one-year time

bar for filing a petition.21 The settled expectation

was that a voluntarily dismissed action without

prejudice was a complete nullity.22 Now, settled

expectations of all stakeholders that were once in

accord have been turned on their head in a manner

that not only upsets decades of understanding

regarding the impact of a dismissal without

prejudice, but creates a perverse incentive to

manipulate the bar.

It is clear that the decision will foster and encourage gamesmanship of the process that will defeat the purposes of the AIA. By way of another example, a patent owner could file an objectively baseless lawsuit, only to voluntarily dismiss the action to

start the one-year clock running. This tactic would

be particularly appealing to a company that may believe it has relatively weak infringement claims with

See, e.g., Apple Inc. v. Rensselaer Polytechnic Inst., No.

IPR2014-00319, 2014 WL 2735064, at *3 (P.T.A.B. Jun. 12,

2014); Macauto U.S.A. v. BOS GmbH & KG, No. IPR201200004, 2013 WL 5947694, at *7-8 (P.T.A.B. Jan. 24, 2013).

22 Oracle Corp. v. Click-to-Call Techs. LP, IPR2013-00312, 2013

WL 11311788, at *7 (P.T.A.B. Oct. 30, 2013), citing Graves v.

Principi, 294 F.3d 1350, 1356 (Fed. Cir. 2002).

respect to a currently-approved product, but whose

patents could be asserted in connection with future

line-extensions as well. In one fell swoop, a patent

owner could effectively insulate its patents from IPR,

for all time, and for all products—even where “there

is a reasonable likelihood that [a] petitioner would

prevail with respect to at least 1 of the claims challenged in the petition.” See 35 U.S.C. § 314(a).

A patent owner could achieve the same effect by

asserting numerous patents in its original complaint,

and then dropping several patents in an amended

complaint. Under the en banc court’s expansive

interpretation, it may not matter that such patents

were dismissed via amended complaint rather than a

Rule 41(a) dismissal. Under the current ruling, any

complaint that was served triggers the one-year bar,

“irrespective of subsequent events.” App. at 47a.

When companies have billions of dollars in

annual revenue at stake, brand-name companies

have every incentive to take advantage of this

judicially-created loophole. It would certainly not be

the first time a brand-name drug company engaged

in sham litigation to protect its monopoly. See, e.g.,

FTC v. AbbVie Inc., No. 14-cv-05151, 2017 WL

4098688, at *12 (E.D. Pa. Sept. 5, 2017) (granting

summary judgment “on the objective[ly] baseless[]

element of the sham litigation prong of [FTC’s]

monopolization claim”).

A statutory interpretation that provides such an

obvious mechanism for manipulation, as described by

Judge Dyk, could not possibly have been what Congress intended.

The En Banc Decision Would Have

Drastic Unintended Consequences

Generic

And

Biosimilar

Companies And Patients.

Unfortunately, the potential for gamesmanship

merely scratches the surface of what is at stake if the

Federal Circuit’s en banc decision is not reversed.

As noted above, brand-name companies routinely

build a “patent thicket” around their brand-name

drug or biologic, patenting every aspect, from the

compound, the formulation, dosage forms and

strengths, uses, delivery devices, and line extensions,

including combination products containing the same

active ingredient. Many of these patents often cover

more than one brand-name product.

For instance, two of the patents listed in FDA’s

Orange Book for Gilead’s Truvada® tablets, an HIV

medication, also are listed for nine other Gilead

products, plus an eleventh HIV product held by

Janssen. Significantly, not all of these products were

approved at the same time; these approvals span the

course of 15 years—from 2003 to 2018.

This

illustrates the problem with closing off a defendant’s

IPR options when litigation over one product is

voluntarily dismissed.

Even if that defendant

diligently searches for related products covered by

the same patents-in-suit during the one-year period

after the original complaint is served, its search

could come up empty, and any failure to file an IPR

at that time could unknowingly prejudice its rights

with respect to later-approved products.

The problem is amplified for biologic products, for

which the patent thicket is even more imposing.23 In

addition to product- and use-based patents, biologic

companies obtain numerous patents covering various

platform

technologies,

including

laboratory

diagnostics, testing devices, and different forms of

gene therapy or gene sequencing technologies, just to

name a few.24 Biologic products also are typically

protected by large numbers of method-ofmanufacturing patents, including, for example,

patents directed to methods of purifying antibodies,

methods of refolding proteins, and methods of

producing antibody compositions using certain host

cells. Moreover, these patents may be licensed to

multiple manufacturers, and thus may cover not just

a single company’s portfolio, but multiple portfolios.

Interpreting Section 315(b) to prevent companies

who were sued over one product from being able to

petition for IPR with respect to other future products

if the original litigation is dismissed will have a

disparate impact on the generic and biosimilar

For example, at least 16 of the patents asserted against

companies seeking approval for a biosimilar to Herceptin® have

also been asserted against companies seeking approval for a

biosimilar to Avastin®. Of these 16 patents, 14 have also been

asserted against companies pursuing approval for a Rituxan®

biosimilar.

24 See Jacob S. Sherkow, Protecting Products Verses Platforms,

34 NATURE BIOTECHNOLOGY 462 (2016).

industries and hamper the ability of such companies

to utilize this important tool.

Voluntary dismissals entered under Rule 41(a)

are common in pharmaceutical and biologic patent

litigation. Patent owners often drop asserted patents

for a variety of strategic, evidentiary, practical, and

cost reasons. Beyond that, parties might agree to

settle litigation with respect to one accused product,

even where the patents at issue cover other approved

products or future products in development that

have not yet been approved. Moreover, a generic or

biosimilar company may decide to discontinue

pursuing approval for a particular product, once

again leading to the voluntary dismissal of any

pending litigation. Simply put, even without overt

gamesmanship, dismissals without prejudice are

frequent

throughout

pharmaceutical

patent

litigation.

Under the en banc ruling, if the original litigation

is dismissed before the one-year deadline, the generic

or biosimilar company would nevertheless be forced

to decide whether to spend the resources to file an

IPR, solely because that patent could cover a

separate product one day in the future. Indeed, the

generic or biosimilar company could be forced into

this Hobson’s choice even before any such separate

product has been added to that company’s research

and development portfolio. This complicates the

decision further because, if the company has not yet

begun development for such future products, it might

not have constitutional standing to appeal any

unfavorable IPR decision. There is no legitimate

reason to snuff out IPR rights in these

circumstances—and even less reason to believe that

Congress intended to do so.

These manifestly absurd results cannot be

squared with Congress’s intent in enacting Section

315(b).

II. SECTION

315(b)

SHOULD

NOT

INTERPRETED IN A WAY THAT DEFEATS

THE PURPOSE AND STRUCTURE OF THE

STATUTE.

Where, as here, an interpretation of a statute

produces unreasonable—if not absurd—results, this

Court can, and should, look beyond the words of the

statute to interpret its meaning, consistent with

Congress’s intent and the overall statutory scheme.

This Court has recognized that “a reviewing court

should not confine itself to examining a particular

statutory provision in isolation. The meaning -- or

ambiguity -- of certain words or phrases may only

become evident when placed in context.” Food &

Drug Admin. v. Brown & Williamson Tobacco Corp.,

529 U.S. 120, 132-33 (2000) (internal quotations and

citations omitted); see also King v. Burwell, 135 S.

Ct. 2480, 2489 (2015) (A court’s “duty, after all, is to

construe statutes, not isolated provisions,” therefore,

“when deciding whether the language is plain,

[courts] must read the words in their context and

with a view to their place in the overall statutory

scheme.”) (internal quotations and citations omitted);

Util. Air Regulatory Grp. v. EPA, 573 U.S. 302, 320

(2014) (finding EPA’s statutory interpretation

“incompatible” with “the substance of Congress’

regulatory scheme”)

citations omitted).

(internal

quotations

and

Turning to the statutory scheme and legislative

history here, it becomes clear that the real world

implications of the Federal Circuit’s en banc decision

“plainly contradict[s] congressional policy” and is

incompatible with the “substance of Congress’

regulatory scheme.” Brown & Williamson, 529 U.S.

at 139, 156. The one-year deadline imposed by

Section 315(b) is grounded in concerns over

duplicative proceedings before federal courts and the

patent office.

As Judge Dyk observed in the

dissenting opinion, “one of the purposes of section

315(b) in setting a one year time period was to bar

the filing of an IPR when, typically, the district court

action would have already consumed the time and

attention of the court and parties.” App. at 105a.

Congress feared that IPRs could be used to harass

patent owners through duplicative litigation and

administrative actions.25

To address this concern, Congress set a one-year

deadline for a defendant served with a complaint to

file an IPR petition. Congress selected this time

period in recognition of the “multiple patents with

large numbers of vague claims” that were regularly

asserted against defendants.26 Congress acted to

ensure that defendants had a “reasonable

25 H.R. REP. NO. 112-98, pt. 1, at 48 (2011).

26 157 CONG. REG. S5429 (daily ed. Sept. 8, 2011) (statement of

Sen. Kyl).

opportunity to identify and understand the patent

claims that are relevant to the litigation” before the

one-year bar went into effect.27

Importantly, as explained in the dissenting

opinion, these concerns are no longer implicated

when the underlying district court litigation is

dismissed without prejudice. App. at 104a-105a. At

that point, the patent owner has chosen not to

continue asserting its patent, and the parties are no

longer using the resources of the court. Moreover, to

the extent the one-year bar conveys some noticeconferring purpose to help reduce the need for dual

proceedings, the entry of a dismissal without

prejudice in the underlying litigation effectively

eliminates the need for that bar. Thus common

sense dictates that Congress did not intend the oneyear bar to insulate a patent from PTAB review

where there is no concurrent proceeding.

The en banc court concerns itself with the

“ordinary, contemporary, [and] common meanings” of

the terms “served” and “complaint” in Section 315(b),

relying on definitions supplied by Black’s Law

Dictionary as support. App. at 47a. But the

meaning of Section 315(b) cannot be ascertained

without looking further at the particular objective of

that provision within the context of the statutory

scheme. This Court previously has explained that “it

is one of the surest indexes of a mature and

developed jurisprudence not to make a fortress out of

27 Id.

the dictionary; but to remember that statutes always

have some purpose or object to accomplish, whose

sympathetic and imaginative discovery is the surest

guide to their meaning.’” Public Citizen v. United

States Dep’t of Justice, 491 U.S. 440, 454-55 (1989)

(quoting Cabell v. Markham, 148 F.2d 737, 739 (2d

Cir. 1945)). “Looking beyond the naked text for

guidance is perfectly proper when the result it

apparently decrees is difficult to fathom or where it

seems inconsistent with Congress’ intention.” Public

Citizen, 491 U.S. at 455; see also Kasten v. SaintGobain Performance Plastics Corp., 563 U.S. 7, 11

(2011).

As explained above, interpreting Section 315(b)

without reading in the context, structure, and

purpose of the entire statute will inevitably lead to

unreasonable, if not patently absurd, results that

cannot be squared with the purpose behind the oneyear bar, let alone the underlying purpose of the IPR

pathway to create an efficient mechanism to review

patents that should not have issued in the first place.

CONCLUSION

This case presents a critical issue of first

impression that can be addressed and corrected only

by this Court. Absent review, the Federal Circuit’s

en banc decision will have a disparate impact on the

generic and biosimilar industry, which will face

unnecessary barriers to utilizing the IPR process to

strike down improperly-issued patents that keep

brand-name products at monopoly prices.

The

petition for certiorari should be granted.

FEBRUARY 13, 2019

Respectfully submitted,