Is a Patent Term Adjustment (PTA) equivalent to a Patent Term Extension (PTE)?

calculation

In Israel, Patent Term Extensions are available for basic patents to ensure at least 9 years of monopolistic sales from the first regulatory approval for a drug covered by the patent. The extension may be for anything up to five years. So as not to limit Israel’s generic drug industry, the patent term extension is only for as long as an extension granted by one of the countries that have similar laws, i.e. Bolar countries.

This ruling relates to whether a patent term adjustment by the USPTO, which typically occurs to compensate for examination delays. See here. There are “A”, “B” and “C’ delays and these may overlap or not overlap. Then thereare Applicant delays that may reduce the patent term adjustment. For more details see here.

On 24 April 2014, a request was filed for a patent term extension for Israel Patent Number 181673 to Genentech INC. The patent is entitled “Pyridyl Inhibitors of Hedgehog Signalling Compounds, Compositions Comprising Them, Process for Their Preparation and use of said Compounds for the Manufacture of Medicaments for Treatment of Cancer In a Mammal”.

Without going into details, apparently the cancer treatment is not limited to cancer in hedgehogs, but also may be used in the treatment of humans.

Without a patent term extension the basic Israel patent will lapse on 2 September 2025.

Erivedge

The basis for the request for the Patent Term Extension was the pharmaceutical sold as Erivedge which includes the active ingredient Vismodegib and which received regulatory approval in Israel on 6 February 2013.

Although the request for a patent term extension was filed on 26 February 2013, it was considered only on 1 May 2014 after the patent was granted. Since the application was filed in February 2013, the relevant legal system is the transitory arrangement of Section 16C of the eleventh amendment to the patent law 2014.

As is apparent from the facts submitted by Genentech’s legal counsel, Ms Lily Ackerman, Genentech received United States FDA marketing approval on 30 January 2012 and in the relevant European markets from 12 July 2013.

With respect to the Request for patent term extension in Israel based on the US patent US 7,888,364 Ms Ackerman noted that “The patent term will end on 11/11/2028 by extension granted under 35 U.S.C. §154(b) Adjustment of Patent Term”.

During prosecution of the request, the Examiner considered it wasn’t clear if the Patent Term Adjustment (PTA) is the equivalent of a Patent Term Extension (PTE). To put it another way, is the extension based on a ruling to the patent due to regulatory delays of the FDA as required by Section 64D of the law?

The applicant filed a response including an affidavit by a US patent attorney and one by the product manager.

The Applicant considers that there are two separate legal questions. The first one is whether the Israel application is entitled to a Patent Term Extension based on the corresponding US patent and if so, how should the length of the Patent Term Extension be calculated?

The Applicant asserted that the fact that the US patent was extended is sufficient for it to serve as the basis for a Patent Term Extension in Israel, regardless of why the patent was extended, which, in the case, was due to a Patent Term Adjustment (PTA) to compensate for delays in the prosecution of the US patent application caused by the USPTO.

Once one accepts the premise that the US patent is a fair basis for extending the Israel patent, the second question is what extension is appropriate. Here the US patent attorney opined that the correct extension is 151 days which is would have been granted under US law as a Patent Term Extension (PTE) had this not been rendered moot by the Patent Term Adjustment which was for 1166 days (over three years) and so overlapped and went beyond this extension. The Patent Term Extension (PTE) of 151 is calculated as to provide 14 years from regulatory approval which is the correct extension under both US and Israel Law.

The Israel Examiner was not convinced. In his decision of 17 February 2015, he explained that according to his understanding of Section 64D(5) of the Israel Law, the Patent Term Extension (PTE) in Israel is for the shortest equivalent extension given by a Bolar country, and in the US no extension was given.

A week later, the Applicant appealed this decision under Section 161 of the Law.

Under Regulation 151, the commissioner Asa Kling ruled as follows:  The Applicant has alleged a serious breach of his rights that contradicts the purpose of the legal arrangement in Israel which, according to the Applicant is to prevent adversely affecting the Israel generic industry with respect to foreign generic players.

In other words, since the patent in the US is valid over this period and US generic manufacturers cannot manufacture, there is no reason not to similarly bind Israel generic companies and, at the same time, provide 14 years post first regulatory approval (i.e by the FDA) in Israel as well.

The request was backed by an Affidavit detailing the R&D involved in developing this drug for treatment of skin cancer. In respect to the Affidavit, the Commissioner correctly noted that the importance of the pharmaceutical is totally irrelevant to the question of patent term extension, and cited the district court in 223/09 H. Lundbeck vs. Unipharm (2009) to this effect, which was upheld by the Supreme Court in 5367/09 H. Lundbeck vs. Unipharm (2010). [MF – here the Commissioner is clearly correct. The issue is one of balancing contrary economic considerations. Indeed, the more important a drug, the more one could argue that there is a public interest for it to come off patent to reduce prices to the consumer]. See also 13281-06-12 Neurim Parmaceuticals (1991) LTD vs Commissioner of Patents, Designs and Trademarks (2012) paragraph 28.

Furthermore, the Commissioner rejected that Patent Term Adjustment (PTA) in the US could be considered as being “An extension of the basic patent in the United States of America” as required by Section 64d(5) as the basis for a Patent Term Extension (PTE). The reason for this is that the term “extension of the basic patent” is defined in section 64a(1) as being granted a Patent Term Extension (PTE) by an appropriate Authority on the grounds of regulatory Approval, etc. which is simply not the case.

In this instance, the Extension in the US was the result of a Patent Term Adjustment (PTA) under Section 154b. Furthermore, Section 35 USC 156 states that:

“(a) The term of a patent which claims a product, a method of using a product, or a method of manufacturing a product shall be extended in accordance with this section from the original expiration date of the patent, which shall include any patent term adjustment granted under section 154(b) if —…”

Section 35 USC 156 was the basis of the Patent Term Extension in Israel under the Eleventh amendment.

In his Affidavit the US patent attorney (Zelano) stated that:

“…pursuant to 35 U.S.C. §156, under certain conditions and the fulfillment of several requirements, a US patent is eligible to receive a patent term extension (PTE), i.e., the extension of the patent’s term passed its original expiration date…”.

In general, a PTA is added onto the “original expiration date” of the US patent thereby resulting in a “new expiration date” of the patent. If the US patent is eligible for a PTE as well, the PTE will be added onto this “new expiration date” under the conditions specified below”. Thus according to Genentech’s Expert witness on USPTO law, the USPTO did not grant an extension beyond the expiration date at all!

The 151 days Patent Term Extension calculated by Zelano was not authorized by an Authority in the USPTO and was never granted.

Citing the ruling concerning the request for a Patent Term Extension (PTE) in IL 110669 Kirin-Amgen Inc. (27 Sept 2012), the Commissioner concluded that the legislator set a methodology for calculating Patent Term Extensions that has conditions that are not applicable in this case. The lack of these conditions does not imply a lacuna in the Law since the US law of 1994 was before the Knesset, as was the amendment before the amendment was amended.

The Commissioner noted that on Appeal, his ruling re IL 110669 Kirin-Amgen Inc. was upheld by the District Court who explicitly rejected the judicial legislation approach. He also cited a ruling concerning IL 9434 Sir Roy Calne (2014) that explained that “pediatric exclusivity” is not a Patent Term Extension (PTE) in the sense of Section 64a.

According to the Commissioner, the purpose of the law is indeed a compromise between the conflicting interests of the drug development and the generic patent industries, but that does not mean that there is a lacuna in the law. The Patent Term Adjustment (PTA) was before the legislative when they worded the law concerning Patent Term Extensions (PTE). He rejects all other interpretations of the intention of the legislative and notes that section 4 of the word of explanation for the Seventh amendment stated explicitly that a patent term extension in Israel would not be granted until a request for an extension in a country that grants extension had been granted. Despite the later amendment, Patent Term Extension (PTE) the Commissioner did not consider that this had changed.

Having found that the Law reflects the intention of the legislative the Commissioner rejected the Appeal under Section 151 but, under section 152, grants the Applicant a month to request a hearing.

COMMENT

In the case of Neurim, Judge Robin Jacob rejected a formalistic understanding of the Law and referred the case to the ECJ who affirmed that the fact that the active ingredient of an insomnia treatment for humans was known in a vetinary treatment for sheep that caused them to enter the mating season earlier, was not sufficient grounds to not grant a Patent Term Extension. However, since previous Deputy Commissioner Axelrod was sideways promoted from the Patent Office for creatively interpreting the Israel Law in favour of drug developers which resulted in the Knesset amending the Law again, I can understand why the Commissioner is taking a formalistic approach.

I suspect that this ruling may be appealed to the courts.

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