Inducing Infringement by Making a Product Available

GlaxoSmithKline LLC v. Teva Pharmaceuticals (Fed. Cir. 2020)

GSK’s patent at issue here covers a method of treating congestive heart failure with the drug carvedilol (Coreg) along with an ACE inhibitor, a diuretic  and digoxin.  RE40,000. Claim 1 below is representative and shows the limitation added during the reissue process:

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.

RE40,000 (original US Pat 5,760,069). Each of these drugs were already known for treating heart disease, and the narrowing reissue was filed after Teva first challenged the patent.

Teva did a couple of things to avoid infringement. First, Teva waited until 2007 to launch its product — that was when the underlying patent on the drug carvedilol expired.  Second, Teva attempted to avoid directly market its drug for the purposes of treating congestive heart failure.  In particular, its product labelling focused instead on hypertension and Ventricular Dysfunction following MI (two non-patented approved uses of the drug).   However, in 2011 the FDA required Teva to alter its labelling to be identical-in-content to the approved GSK product.  Thus, in 2011 Teva added treatment for heart failure as an indication for treatment.

Once the labeling was changed, GSK then sued for inducing doctors to infringe.

271(b) Whoever actively induces infringement of a patent shall be liable as an infringer.

At trial the jury sided with the patentee — finding the patent valid and willfully infringed and then awarding $234 million in lost profit damages.

Post-trial, the district court flipped the award — finding insufficient evidence that Teva “actually caused” any particular physician to infringe. “Without proof of causation, which is an essential element of GSK’s action, a finding of inducement cannot stand.”  District Ct. Awarding JMOL.  The district court noted lots of publications and promotions informing physicians about how to use the product to treat heart failure — none of which came from Teva.  Practicing doctors don’t read the fine-print on the side of the bottle. In fact, GSK’s MD expert admitted that he did not read the Teva label before prescribing.

On appeal here, the Federal Circuit has reversed — holding that the circumstantial evidence of inducement was sufficient.  In particular, in this situation Doctors relied upon Teva’s statements that its drug was interchangeable with GSK’s — a “complete replacement.”  My Mizzou colleague, Professor Erika Lietzan testified as a FDA-expert for GSK at trial. Her testimony includes the conclusion that (1) the “AB-rating” of the generic indicates that the products are interchangeable; and (2) comparing GSK’s product by-name creates an implication of interchangeability.

The majority opinion here was written by Judge Newman and joined by Judge Moore. Chief Judge Prost wrote in dissent — arguing that the decision here undermines the balance between innovator incentives and the introduction of lower-cost generics.

Teva waited until GSK’s patent covering the carvedilol compound expired to launch its product covering two unpatented indications hypertension and post-MI LVD. So, when GSK’s ’000 reissue patent later issued—reciting a narrow method of treating a third indication, CHF—Teva’s skinny label did not even suggest using its product according to the patented method.

At the FDA’s direction, Teva amended its label years later to include the patented method, but there was still no inducement via the full label. Nothing changed in the market, and doctors’ prescribing decisions were not affected. By that time, GSK could not rely on Teva’s ANDA as an artificial act of infringement. Thus, to prove induced infringement, GSK had to show that Teva actually caused doctors to directly infringe the ’000 patent. It failed to do so.

Dissent.  With regard to Prof. Lietzan’s testimony, the dissent quoted to her same statement regarding AB-rating — noting that “AB rating reports therapeutic equivalence only ‘if the generic drug is used in accordance with the label.'” The AB-rating does not apply to “off-label uses.”

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The majority also sustained the jury’s damages verdict.  Teva argued that the lost-profit award was improper because there were other generic versions on the market.  If Teva hadn’t been on the market then the sales would have gone to the other generic producer — not back to the higher-priced GSK.  In its decision, the district court identified the other generic versions as “infringing alternatives” (GSK is in a separate lawsuit against them) and thus should not count in the economic picture of lost profits.  On appeal, the Federal Circuit affirmed — holding that “The district court correctly instructed the jury that the availability of carvedilol from other generic producers is not a ‘noninfringing substitute.'”

Thus, in the end, the jury verdict is reinstated and Teva will have to pay the money. Note — the ‘000 patent is also expired and so generics continue to be available.

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Presumably, Teva could have avoided infringement by sending notices to pharmacies and doctors to avoid proscribing its product for congestive heart failure.

9 thoughts on “Inducing Infringement by Making a Product Available

  1. 5

    Who still uses “said” in claims today, and why?

    1. 5.1

      Randall,

      On the Address and Attorney tab in Public PAIR for the original application, the Newest registration number is 33870 – with at least four listed in the 20,000 series.

      As to why, while perhaps archaic, it does not rise to the level of patent profanity that has pushed changes in other terms.

  2. 4

    Not enough info here. Why did the FDA stop allowing the carve-out and insist on identical labeling, several years after the initial label was approved with the carve-out?

    Newman is, of course, correct that once the label was identical, Teva induced infringement, but the policy issue to which Prost points is a legitimate concern. I’m just not sure it’s a legitimate concern for the *court*, which is why I wonder why the FDA changed its mind (and why it was allowed to require Teva to use an identical label).

  3. 3

    Is there any way that Teva could have sold this supposedly “public domain” product while avoiding infringement? I doubt the proposed notice to doctors and pharmacists would have been sufficient. It would have only further highlighted the product’s potential use.

    And perhaps it wasn’t Teva, but rather the FDA, that was the actual party inducing infringement by insisting on the label alteration as a condition for approval.

  4. 2

    “However, in 2011 the FDA required Teva to alter its labelling to be identical-in-content to the approved GSK product.”

    I feel like this needs some explanation. Was there some way that Teva could have avoided this labeling requirement, and they just didn’t do it?

    1. 2.1

      I hear you, Apotu (me and Paul Harvey think that there is a “rest of the story” awaiting).

    2. 2.2

      Nope – Nothing they could have done absent conducting their own trials to prove the effectiveness of the therapy.

      1. 2.2.1

        Absent coat-riding on the works of others…

        Seems at its face to be a legitimate trade-off of expense for convenience (with only buyers remorse as to what that expense actually entailed).

  5. 1

    “Presumably, Teva could have avoided infringement by sending notices to pharmacies and doctors to avoid proscribing its product for congestive heart failure.”

    Not after it amended its label in response to FDA’s request. Would be interested in seeing how vigorously Teva objected to FDA’s request.

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