Terms Of Terminally Disclaimed Patents Can Be Extended

In Merck & Co. v. Hi-Tech Pharmacal Co., (No. 06-1156; March 29, 2007), a Federal Circuit panel affirms a district court’s judgment denying Hi-Tech’s motion to dismiss and holding that a patent term extension under § 156 may be applied to a patent subject to a terminal disclaimer.

Merck secured patent protection for the active ingredient in TRUSOPT® by filing a terminal disclaimer disavowing any term of the product patent that would extend beyond the expiry of an earlier Merck patent. Merck was then granted a patent term extension under 35 U.S.C. § 156 and that extension was based on the effective date of the terminal disclaimer, i.e., the expiry of the earlier Merck patent. Years later, Hi-Tech sought approval of a generic version of TRUSOPT®, asserting that the product patent had expired because the terminal disclaimer foreclosed the patent term extension. Hi-Tech moved to dismiss Merck’s claim for infringement and in response, Merck moved for judgment on the pleadings. The district court dismissed Hi-Tech’s motion, enjoining Hi-Tech from commercializing the drug claimed in the product patent until the end of the patent term extension. Hi-Tech appealed.

In affirming the district court’s decision, the Federal Circuit dismisses Hi-Tech’s argument that a terminal disclaimer is a waiver of patent term and the grant of an extension on such a patent improperly uncouples the extended patent and the earlier patent. The court noted that “[t]he purpose of the terminal disclaimer—to prevent extension of patent term for subject matter that would have been obvious over an earlier filed patent—remains fulfilled by virtue of the fact that the date from which any Hatch-Waxman extension is computed is the terminally disclaimed date. At the same time, the purpose of the patent term extension—to restore some of the patent term lost due to regulatory review—is also satisfied.”