Insights

The Federal Circuit recently addressed a case of first impression involving AI patented technology under 35 U.S.C. § 101 to hold that “claims that do no more than apply established methods of machine learning to a new data environment” are not patent eligible. This case provides helpful guidance for patent prosecutors on how to draft claims directed to AI technology to be patent-eligible and for litigators on how to attack or defend AI patents.

Following federal lawmakers’ initiative to lower prescription drug prices under the Inflation Reduction Act of 2022, several states have taken similar steps to limit certain drugs’ prices. Drug affordability for consumers is a top priority for federal and state lawmakers and regulators because it is a bipartisan issue that directly impacts consumers’ wallets. With negotiations between the federal government and drug manufacturers over 10 drugs’ prices for Medicare beneficiaries well underway under the Inflation Reduction Act, 11 states, including Maryland and Colorado, have created drug affordability review boards to more directly tackle rising prices for both brand and generic drugs.[1] And another 12 states have pending legislation to create these boards.[2] 

On March 1, 2024, Judge Colm F. Connolly of the District of Delaware granted the government’s motion for summary judgment in the first substantive ruling on the constitutionality of the Inflation Reduction Act (“IRA”).  The court first held that AstraZeneca Pharmaceuticals LP and AstraZeneca AB’s (collectively, “AstraZeneca”) lacked Article III standing to challenge the Center for Medicare and Medicaid Services’ (“CMS”) guidance under the Administrative Procedure Act (“APA”).  The court then rejected AstraZeneca’s challenge to the IRA as an unconstitutional taking on the merits because, in its view, AstraZeneca “ha[d] not identified a property interest protected by the Constitution that is put in jeopardy by the Program.”[1] The court’s opinion comes on the eve of oral argument in a closely-followed related case in the District of New Jersey and marks a significant development in IRA jurisprudence.

On February 12, 2024, Judge David Alan Ezra of the Western District of Texas dismissed a lawsuit challenging the constitutionality of the Drug Price Negotiation Program of the Inflation Reduction Act of 2022, P.L. 177-169 (IRA).[1]

In Vanda Pharmaceuticals, Inc. v. United States, No. 23-629C (Fed. Cl. 2024), 2024 WL 201890, the Court of Federal Claims (COFC) addressed whether government disclosure of a company’s trade secrets and commercial information could create a viable claim for a taking under the Fifth Amendment or for breach of an implied-in-fact contract.  The company, Vanda Pharmaceuticals (Vanda), claimed that the government’s disclosure of its confidential trade secrets—including its trademarked drugs’ dissolution rates—to competitors seeking U.S. Food and Drug Administration (FDA) approval of generic drug alternatives was an unlawful regulatory taking that diminished the value of Vanda’s brand name drugs and infringed upon Vanda’s right to exclude generics from the market.  The government moved to dismiss Vanda’s claims for lack of subject matter jurisdiction and for failure to state a claim.  The COFC denied the government’s motion in part, holding as a matter of first impression that Vanda adequately stated a takings claim based on the government’s disclosures but failed to state a claim for breach of an implied-in-fact contract.  The COFC also held that Vanda’s claims involving one generic drug manufacturer were outside the Tucker Act’s six-year statute of limitations and were time barred. 

Drug development in the United States is expensive and time-consuming, which makes pharmaceutical patents an important asset for pharmaceutical companies to protect their investment in bringing new drugs to market.  Equally important to the public and other drug companies is that any pharmaceutical patents that are issued by the Patent Office cover only technology that is new and not obvious. Clinical trials frequently lie at the intersection of these two competing interests. Pharmaceutical companies must engage in clinical trials to test their new products and the existence of those clinical trials may become public. But can the announcement of a trial itself render the resulting invention obvious and unpatentable?

Since the Supreme Court’s 2017 sea change venue decision in TC Heartland v. Kraft Food Group Brands, the Northern District of West Virginia has seen an uptick in substantive Hatch-Waxman litigation involving local pharmaceutical company, Viatris Inc. (formerly known as Mylan Pharmaceuticals). Viatris is frequently named as a defendant in Hatch-Waxman litigations, each of which is triggered by Viatris’s service of a statutorily-required notice letter stating why the patents that allegedly cover the brand name drug are invalid and/or not infringed by a proposed generic drug. Hatch-Waxman litigants have battled over the requirements for these notice letters in other courts. In Bausch Health Ireland Ltd. et al. v. Mylan Pharms. Inc., the Northern District of West Virginia has now added to that body of law, adopting a holding consistent with other courts that a generic drug company is not foreclosed from asserting additional defenses in litigation even if those defenses were not raised in the generic drug company’s notice letter. See No. 1:22CV20, 2023 WL 2726432, at *3 (N.D.W. Va. Mar. 30, 2023).

The case of Juno Therapeutics, Inc. v. Kite Pharma, Inc.[1]has captured the attention of the legal community and beyond, as it delves into the complex world of written description in patent law.  The Supreme Court recently made a significant decision in Juno by denying certiorari on appeal from the Federal Circuit.  On January 9, 2023, the Supreme Court denied Juno’s petition for rehearing.