Novartis Pharma Corp v. Teva Pharma USA Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Novartis Pharmaceuticals Corporation (Delaware) and Novartis AG (Switzerland)
  • Defendant: Teva Pharmaceuticals USA, Inc. (Delaware)
  • Plaintiff’s Counsel: McCarter & English, LLP; Fitzpatrick, Cella, Harper & Scinto
• Case Identification: 1:17-cv-00867, D. Del., 06/30/2017
• Venue Allegations: Venue is asserted on the basis that Defendant is a Delaware corporation.
• Core Dispute: Plaintiff alleges that Defendant’s submission of an Abbreviated New Drug Application (ANDA) to market generic everolimus tablets constitutes an act of infringement of a patent covering the everolimus compound and its pharmaceutical use.
• Technical Context: The technology relates to chemical derivatives of rapamycin, specifically everolimus, an immunosuppressant compound used in oncology and for preventing organ transplant rejection.
• Key Procedural History: The lawsuit was initiated under the Hatch-Waxman Act following Defendant's submission of an ANDA with a Paragraph IV certification. This certification alleged that certain claims of the asserted patent are invalid and others are not infringed by the proposed generic product. The complaint was filed within the 45-day statutory window, triggering an automatic 30-month stay of FDA approval for the generic. The asserted patent was the subject of several inter partes review (IPR) proceedings (IPR2016-00084, IPR2016-01023, IPR2016-01102), which concluded with a certificate issued on May 17, 2019, confirming the patentability of claims 1-3 and 8-10.

Case Timeline

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 5,665,772 - O-ALKYLATED RAPAMYCIN DERIVATIVES AND THEIR USE, PARTICULARLY AS IMMUNOSUPPRESSANTS

• Issued: September 9, 1997

The Invention Explained

• Problem Addressed: The patent identifies rapamycin as a potent immunosuppressant whose clinical utility is limited by "very low and variable bioavailability," "high toxicity," and high insolubility, which complicates the creation of stable pharmaceutical formulations ('772 Patent, col. 1:35-40).
• The Patented Solution: The invention discloses novel O-alkylated derivatives of rapamycin designed to overcome the parent compound's deficiencies. These derivatives are described as having an "improved pharmacologic profile," "greater stability and bioavailability," and being easier to formulate ('772 Patent, col. 1:41-45). The key modification is the substitution at the C40 position of the rapamycin macrocycle, with one preferred embodiment being 40-O-(2-hydroxy)ethyl-rapamycin, the compound known as everolimus ('772 Patent, col. 2:30, 56-62).
• Technical Importance: This chemical modification strategy provided a pathway to develop a clinically viable therapeutic that retained the potent immunosuppressive activity of rapamycin while possessing more favorable drug-like properties ('772 Patent, col. 1:41-45).

Key Claims at a Glance

• The complaint alleges infringement of "one or more claims" of the '772 patent and references a notice letter concerning claims 1-10 (Compl. ¶¶ 16, 20). The key independent and specific claims are:
• Independent Claim 1:
  • A compound of the rapamycin derivative formula depicted in the claim
  • wherein R¹ is hydroxy(C1-6)alkyl or hydroxy(C1-3)alkoxy(C1-3)alkyl
• Dependent Claim 10 (as corrected by a 1998 Certificate of Correction):
  • The compound according to claim 1 which is 40-O-(2-hydroxyethyl)-rapamycin.

III. The Accused Instrumentality

Product Identification

Teva's generic everolimus tablets in 2.5 mg, 5 mg, 7.5 mg, and 10 mg dosage strengths, for which Teva filed an ANDA seeking FDA approval (Compl. ¶15). The complaint refers to these as the "ANDA Products" (Compl. ¶15).

Functionality and Market Context

The complaint alleges that Teva’s ANDA Products, if approved, will contain the active ingredient everolimus, chemically identified as 40-O-(2-hydroxyethyl)-rapamycin (Compl. ¶¶ 12, 20). This is the same active ingredient as in the Plaintiffs' branded drug, AFINITOR®, which is approved for treating various forms of cancer (Compl. ¶11). Teva's filing of an ANDA represents a commercial effort to market a generic equivalent to AFINITOR® prior to the expiration of the '772 Patent (Compl. ¶¶ 15, 18).

IV. Analysis of Infringement Allegations

The complaint alleges infringement under 35 U.S.C. § 271(e)(2), which defines the submission of an ANDA for a patented drug as a statutory act of infringement. The infringement theory is that the product described in Teva's ANDA is covered by the claims of the '772 Patent.

’772 Patent Infringement Allegations

Identified Points of Contention

• Validity vs. Infringement: The complaint states that Teva's notice letter did not contest that its ANDA Products would infringe claims 1-3, 7, and 10 if those claims are valid, instead alleging they are invalid (Compl. ¶16). This frames the primary dispute for these claims as one of patent validity. The subsequent IPR decision finding claims 1-3 and 8-10 patentable raises the question of what invalidity defenses, if any, remain available to Teva in the district court action.
• Scope Questions: For claims 4-6 and 8-9, Teva's notice letter alleged non-infringement (Compl. ¶16). The complaint does not provide sufficient detail for analysis of Teva's specific non-infringement theories for these claims. The dispute will likely turn on whether the specific formulations or methods of use associated with Teva's product fall outside the scope of these dependent claims.

No probative visual evidence provided in complaint.

V. Key Claim Terms for Construction

The dispute appears to center more on validity than claim construction, especially for the compound claims. However, the scope of the method claims could be at issue.

The Term: "immunosuppressant effect" (from independent method Claim 8)

Context and Importance

This term defines the scope of the patented method. Practitioners may focus on this term because Defendant's non-infringement defense for method claims could, in theory, hinge on arguing that the intended use of its generic product does not constitute inducing an "immunosuppressant effect" as defined by the patent, thereby avoiding infringement of claims like Claim 8.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: The specification describes the invention as useful for a wide array of conditions, including "organ or tissue transplant rejection" and numerous "autoimmune disease and inflammatory conditions" such as rheumatoid arthritis and multiple sclerosis ('772 Patent, col. 3:22-55). This could support an interpretation covering a broad range of therapeutic applications that rely on suppressing the immune system.
• Evidence for a Narrower Interpretation: The patent uses specific in vitro and in vivo assays, such as the Mixed Lymphocyte Reaction (MLR) and Kidney Allograft Reaction tests, to demonstrate and quantify the "immunosuppressive effect" ('772 Patent, col. 4:16-41; col. 5:34-42). A party might argue that the term should be limited by the context of these experimental models and the specific biological activity measured therein.

VI. Other Allegations

Indirect Infringement

The complaint's primary allegation is statutory infringement under 35 U.S.C. § 271(e)(2) based on the ANDA filing itself (Compl. ¶18). It also seeks a declaratory judgment that the future commercialization of Teva's product "will directly infringe one or more claims" (Prayer for Relief ¶D). The complaint does not plead specific facts to support a separate count of inducement or contributory infringement, though it does allege Teva has taken "active steps towards the commercial manufacture, use, offer for sale, or sale" of its products (Compl. ¶22).

Willful Infringement

The complaint does not contain an explicit allegation of willful infringement or a prayer for enhanced damages. It does allege that Teva was "aware of the '772 patent" at the time it filed its ANDA, a necessary factual predicate for a willfulness claim (Compl. ¶19).

VII. Analyst’s Conclusion: Key Questions for the Case

• A central issue is the residual impact of invalidity challenges. Given that Teva's primary defense to infringement of the core claims was validity (Compl. ¶16), and that an IPR proceeding subsequently confirmed the patentability of claims 1-3 and 8-10, a key question is what legal or factual grounds for invalidity, if any, remain for Teva to pursue in district court.
• The case may also present a question of infringement scope for method claims. For the claims Teva alleges it does not infringe, the dispute will likely focus on whether the specific instructions for use in its proposed product label direct a method falling within the patent's description of an "immunosuppressant effect" or other limitations of the asserted method claims.
• A final point of analysis concerns the legal certainty of the compound claim. The 1998 Certificate of Correction, which amended Claim 10 to recite the precise chemical name for everolimus, creates a very direct basis for literal infringement. The key question is whether any viable argument exists to challenge the straightforward application of this corrected claim to Teva's everolimus product.