All the big life sciences patent news from May
In May’s round-up of life sciences-related patent news, we report on new research revealing a sharp surge in CRISPR patent filings in Asia, on mistaken claims that China has introduced a new 25-year pharma patent term and on the data showing the crucial role immune-oncology is playing in pharma patent deals.
Market radar:
IAM-commissioned research reveals rapid increase in Asia CRISPR filings – Last month, IAM commissioned and published cutting-edge research, undertaken by iRunway, providing new insights into the geographical spread, technological focuses and top owners of CRISPR-related patent applications, as detailed here. Among its key finding were that, while the US has had the most CRISPR filings until recent years, there has been a more recent surge in patent registrations in Asia, especially in China and Japan. And whereas the US has a relatively high grant-rate for applications (14.5%), the rate in Asia is significantly lower at 6%-8%. The research also showed that DowDuPont, revealed by previous iRunway research to be the world leader in CRISPR filings, actually lags behind Harvard University and MIT when it comes to US patent applications and grants, while outstripping other entities before the Chinese, Korean and Japanese patent offices.
Trump drug price proposals leave pharma patents untouched – May saw US president Donald Trump set out in greater detail his plans to bring down the country’s high drug costs. Early during his time in office, Trump accused pharmaceuticals companies of “getting away with murder”; and his choice of health secretary, Alex Azar, though himself a former Eli Lilly executive, vowed to tackle the “gaming or exploitation of exclusivities or patents by branded drug companies”. But right holder fears that the country’s unpredictable president might seek to water down life sciences patents were allayed in February, when a drug pricing white paper from the Trump’s executive office made a robust defence of pharma innovators’ rights, identifying regulatory and insurance issues, as well as foreign “free-riding” as the causes of high medical prices. And the Trump administration’s new policy blueprint, published last month, further suggests that this presidency will not see anti-patent reforms with the intention of lowering healthcare costs. It is the “gaming” of regulatory processes, rather than the “gaming” of the patent system, that comes under fire in the document; whereas a “generational loss of patent exclusivity” is even identified as a challenge for the country’s healthcare market.
Delaware tops the patent litigation charts, but trouble could be brewing - Lex Machina’s 2018 ANDA Litigation Report was released in May, shedding light on the most recent trends in US district court and PTAB litigation over Orange Book-listed pharmaceuticals patents. Among its key findings – outlined in more detail in this IAM blog – is that the US district court for the District of Delaware (already the most popular venue for these conflicts) increased its lead as the court with the most filings for pharma patent lawsuits in 2017. One interesting point made by Lex Machina’s Chief Evangelist, Owen Byrd was that this trend, combined with a shortage of judges in the district, could have an adverse on the court’s performance in years to come.
German patent troll claims it is closing in on pharma patent deal – IAM spoke to a German company, once described as a new-style European patent troll, which claims it is now on the brink of monetising pharma patent rights that it acquired through a loophole in the European Patent Convention (EPC). IP Gesellschaft für Management (IPGM) came to prominence in late-2016, when a German patent law firm raised concerns about its activities. The company has implemented a novel strategy, applying for several patents – at least one of which has now been granted – on innovations very similar to those developed by major pharmaceuticals innovators, making use of Article 54(3) of the EPC, which states that the inventive step of an application is not affected by an earlier application published on the same day it is filed. A representative of IPGM told IAM that it is now waiting for the organisations with conflicting rights to gain marketing approval, at which point it intends to approach them with a view to obtaining a negotiated patent infringement settlement. He also stated that IPGM has been engaged in discussions with prominent US patent monetisation entities as a means of boosting its litigation capabilities. But, with European litigation much cheaper and quicker than in the US, and a greater likelihood of having to repay the other side’s legal fees if defeated, it remains to be seen whether IPGM will enjoy success in its endeavours.
25-year Chinese patent term headlines mistaken, but pharma reforms are in the pipeline – A flurry of headlines was generated following a report that China had introduced 25-year patent terms for innovative drugs. This, however, turned out to be false, with several sources telling IAM no such changes had been implemented. The misunderstanding seems to have been caused, as I wrote in a recent blog, by the Chinese government’s ongoing consideration of several pharma patent reforms, including a potential five-year patent term extension for original drugs launched in China at the same time as elsewhere, as well as an extension of data exclusivity rights and new compulsory drug licensing initiatives. So, while five-year patent extensions are not yet available to pharma innovators, changes to the country’s IP regime look set to be made in the near future.
Legal radar:
Indivior and Par Pharmaceutical settle Suboxone suit – Indivior reached a settlement with Par Pharmaceutical, which seeks to bring a generic version of its Suboxone Film to market. Litigation – which was due to take place in Delaware – had previously been initiated following an ANDA for the copycat opioid addiction treatment, which Indivior claimed infringed its patents. But the need for a court decision has now been dissipated by an agreement which prevents the generic from being brought to market until 2023. Indivior’s chief executive Shaun Thaxter welcomed the settlement, and commented that the company would seek to resolve its remaining Suboxone Film patent disputes in a way that reflects the strength of its intellectual property, which includes three new Orange Book patents for the treatment.
Method of treatment claims held patent eligible - Two sets of US patents for methods of treatment withstood a section 101 challenge before the Delaware federal district court. The patents, which are owned by Pernix Ireland Pain DAC, protect methods of treating pain caused by compromised liver function (hepatic impairment) by administering an oral dosage comprising an extended release formulation of hydrocodone bitartite. Having been targeted by an infringement lawsuit, Alvogen Malta Operations – which was seeking to market a generic of Pernix’s Zohydro drug – sought to invalidate the patents, claiming that they were directed towards laws of nature and therefore cover patent ineligible subject matter. This was because the claims are “premised on the relationship between (hepatic impairment) and the bioavailability of hydrocodone in the body after administration of Devane’s (extended release hypocodone) prior art formulation – namely that the response of the human body to this formulation is similar in patients with and without mild or moderate (hepatic impairment)”. But on 15th May, the court ruled that the claims made by Pernix’s asserted patents “do more than merely report…physiological responses” and add something of significance to the natural laws they observe; they describe an application of a specific dosage to treat a specific ailment given a patient’s medical status. As explained in greater detail here, the court distinguished the case from Mayo, and cited two recent federal rulings – in Rapid Litigation Management Ltd v CellzDirect Inc and Pharmaceuticals Inc v West-Ward Pharmaceuticals International Ltd. – in its decision.
Lizness patent dispute brought to a close – Early last month, Ironwood and Allergan settled another patent lawsuit with a producer of a generic version of Lizness, a treatment for irritable bowel syndrome. Their dispute with Aurobindo Pharma was brought to an end, with the defendant agreeing to a very lengthy delay of US market launch until 5th August 2030. This highly favourable outcome echoes Ironwood and Allergan’s recent settlement with Sun Pharma, which agreed that its copycat Lizness would not be brought to market in the US until February 1st 2031.
Deal watch:
Immuno-oncology driving pharma deals, suggests Clarivate Analytics data – In a guest blog for IAM, Bob Stembridge, who heads up communications at Clarivate Analytics, wrote that cancer immunotherapy assets have become “The major driver behind deal making in the pharmaceutical industry, with 32 of the 35 multi-billion deals in the last five years being focused on immuno-oncology”. This corroborates previous IAM analysis, in which – drawing on an exclusive interview with EvaluatePharma’s head of forecasting – I argued that a broader “gold rush” towards oncology has had, and will increasingly have, a profound effect on transactions in the sector. Stembridge stated that an explosion of cutting-edge immuno-oncology research in recent years has led to a rapid growth in the number of patent applications being made for innovations in the field.
Johnson & Johnson acquires oncolytic virus company for up to $1 billion – At the start of May, Janssen, Johnson & Johnson’s pharmaceuticals business, announced that it had agreed to buy BeneVir Biopharma, a biotech specialising in oncolytic viruses. The deal, potentially worth as much as $1 billion, sees Johnson & Johnson – like many other life sciences organisations – moving to strengthen its pipeline in the immune-oncology space. Most of the value of the deal - $900 million – will depend on the achievement of various milestones, with $140 million to be paid upfront.
Eli Lilly moves to strengthen oncology presence – Eli Lilly announced not one, but two new deals last month aimed at bolstering its position in the increasingly lucrative oncology treatment area – where it is thought to lag behind many of its closest Big Pharma rivals. First came the purchase of ARMO Biosciences for as much as $1.6 billion – a deal that sees Lilly acquire the rights to the biotech’s promising immune-oncology drug, pegilodecakin. Just days later, it was revealed that the Indiana-based corporation had agreed to buy Canadian start-up AurKa Pharma in a deal potentially worth $576 million. In the latter acquisition, Eli Lilly will buy back AK-01 (Aurora kinase A inhibitor), which it offloaded in 2016 when the oncology asset was considered a low priority.
Takeda mega-deal could spawn spin-offs - In our last monthly life sciences IP round-up, we reported on the Takeda’s $60 billion deal to buy Shire – the largest ever acquisition by a Japanese company. While Takeda continues to seek support for the agreement from its shareholders, its CEO Christophe Weber has commented on some of the deal’s strategic implications. Notably, he said that following the purchase – in which the Japanese company will take on significant debt – large spending cuts would be needed, including cuts to R&D outgoings. This, Weber continued, meant that Takeda could not “waste resources on assets that moderately innovative. When you combine two pipelines you can be more stringent.” These words suggest that the headline-grabbing deal could have the knock-on effect of bringing several pipeline assets onto the market, thereby potentially spawning a series of smaller transactions.