Apotex’s appeal of a grant of a preliminary injunction by the United States District Court for the Southern District of New York in favor of Sanofi-Synthelabo was smacked down by the CAFC. See Sanofi-Synthelabo et al. v. Apotex (06-1613).
Sanofi markets Plavix®, a platelet aggregation inhibiting agent used to reduce thrombotic events such as heart attacks and strokes. The active ingredient of which is clopidogrel bisulfate, covered by U.S. Pat. 4,847,265.Clopidogrel is the dextrorotatory enantiomer of the free base methyl alpha-5-(4,5,6,7-tetrahydro(3,2-c)thienopyridyl)-(2-chlorophenyl) acetate, which the parties refer to as “MATTPCA.” The active ingredient in Plavix® is the bisulfate salt of the d-enantiomer of MATTPCA, which is specifically recited in claim 3 of the ’265 patent.
Apotex had filed an Abbreviated New Drug Application (“ANDA”) pursuant to the Hatch-Waxman Act seeking FDA approval to manufacture and sell a generic version of clopidogrel bisulfate. When Apotex filed a Paragraph IV certification with its ANDA asserting that the ’265 patent is invalid, Sanofi sued Apotex on the ’265 patent. Apotex counterclaimed, asserting that the patent is invalid and unenforceable.
The parties negotiated a settlement agreement that provided for actions in the event that the settlement failed to receive regulatory approval. After state attorneys general said they would not approve the settlement, litigation resumed.
Pursuant to the agreement, Apotex launched its generic clopidogrel bisulfate product on and Sanofi filed for a preliminary injunction and requested a recall of Apotex’s products that were already distributed. The district court granted the motion for injunctive relief but denied the request for recall. Noteworthy is that Apotex shipped a six-month supply of its product to distributors in the US.
In reaching its decision, the district court applied the established four-factor test for preliminary injunctive relief, and found that the factors weighed in favor of an injunction. Regarding the likelihood of success on the merits, the court noted that Apotex conceded that its accused products infringe claim 3 of the ’265 patent. The court then found that Apotex failed to establish a likelihood of proving invalidity at trial — rejecting its anticipation, obviousness, and obviousness-type double patenting invalidity defenses. The court also determined that Apotex failed to raise a substantial question as to whether the ’265 patent is unenforceable due to inequitable conduct. Additionally, the court found that the remaining three factors of the test favored issuance of a preliminary injunction. Apotex then appealed.
A preliminary injunction is granted only if a party establishes four factors: “(1) a reasonable likelihood of its success on the merits; (2) irreparable harm if an injunction is not granted; (3) a balance of hardships tipping in its favor; and (4) the injunction’s . . . impact on the public interest.” Amazon.com, 239 F.3d at 1350. Permanent injunctive relief requires success on the merits as a precondition to grant by a court.
(1) A reasonable likelihood of its success on the merits
In order to satisfy the first element of the test, Sanofi must demonstrate that, “in light of the presumptions and burdens that will inhere at trial on the merits,” Sanofi will likely prove that Apotex’s product infringes the ’265 patent and that it will withstand Apotex’s challenges to the validity and enforceability of the ’265 patent. Thus, the first element was properly found satisfied if Apotex failed to raise a “substantial question” with regard to the validity or enforceability of the ’265 patent — or, if it succeeded in doing so, Sanofi demonstrated that those defenses “lack substantial merit.”
Apotex asserted that U.S. Pat. 4,529,596 anticipates claim 3 of the ’265 patent. The district court rejected Apotex’s argument on two grounds. First, the court found that the ’596 patent does not describe clopidogrel bisulfate. Second, the court determined that the ’596 patent does not enable a person of ordinary skill in the art to make clopidogrel bisulfate without undue experimentation.
On appeal, Apotex argues that the district court erred by improperly focusing its anticipation analysis on claim 1 of the ’596 patent, which claims a broad genus of compounds, and by failing to consider claim 2, which claims the free base of clopidogrel, MATTPCA. According to Apotex, claim 2 describes clopidogrel bisulfate and thus anticipates claim 3 of the ’265 patent.3 Apotex advances two main arguments in support of this position.
Apotex argued that a person of ordinary skill in the art would interpret claim 2 of the ’596 patent in light of the specification as not only disclosing the racemate free base, but also the dextrorotatory and levorotatory enantiomers, as well as pharmaceutically acceptable salts, including the bisulfate. According to Apotex, the genus disclosed in claim 2 of the ’596 patent is a small class to which clopidogrel bisulfate belongs, which describes all members of that class.
Apotex’s anticipation argument on appeal is solely based on Apotex’s assertion that claim 3 of the ’265 patent is unpatentable in view of claim 2 of the ’596 patent. Claim 3 of the ’265 patent reads as follows:
3. Hydrogen sulfate of the dextro-rotatory isomer of methyl alpha-5 (4,5,6,7-tetrahydro (3,2-c) thienopyridyl) (2-chlorophenyl) – acetate substantially separated from the levo-rotatory isomer.
Thus, the claim consists of the following key limitations: 1) the d-enantiomer; 2) of the compound MATTPCA; 3) the bisulfate salt; and 4) substantial separation from the levorotatory isomer.
However, claim 2 of the ’596 patent, in contrast, reads as follows:
2. Methyl α-(4,5,6,7-tetrahydro-thieno(3,2-c)-5-pyridyl)-o.chlorophenyl-acetate.
Thus, claim 2 only recites the free base, MATTPCA, and does not expressly describe the dextrorotatory or levorotatory enantiomers or any salt. The CAFC held that because claim 2 fails to describe each and every limitation of claim 3 on its face, claim 2 does not anticipate claim 3.
(2) Irreparable harm if an injunction is not granted
The district court applied a presumption of irreparable harm in light of its conclusion that Sanofi established a likelihood of success on the merits. The court also found that Sanofi proffered substantial evidence establishing other forms of irreparable harm, including irreversible price erosion, loss of good will, potential lay-offs of Sanofi employees, and the discontinuance of clinical trials that are devoted to other medical uses for Plavix®.
Apotex argued that the settlement agreement entered into by Sanofi and Apotex negated any finding of irreparable harm since their settlement agreement measured the harm it would suffer in the event Apotex marketed a generic product — specifically, 40%-50% of Apotex’s net sales. The CAFC disagreed that by entering into that agreement, Sanofi bargained away its right to seek preliminary injunctive relief, and thus its right to prove irreparable harm, in the event the settlement was not approved, holding:
“[M]erely because a patentee is able to identify a monetary amount that it deems sufficient to avoid or end litigation does not necessarily mean that it automatically foregoes its right to seek a preliminary injunction or that any potential irreparable injury ceases to exist if infringement resumes.”
(3) Balance of hardships tipping in its favor
As to the third factor of the test, Apotex argued that the harms Sanofi would suffer are a result of its own conduct. The court laughed this argument off so hard it wouldn’t even consider it.
(4) The injunction’s impact on the public interest.
Apotex argued that the district court erred in failing to consider certain public harms that would result if an injunction issues stating that if the generic products were removed from the market, consumers would be inclined not to purchase their medication because of the accompanying price increase for the brand name drug, leading to possible deaths. The CAFC sided with Sanofi that the interest in encouraging pharmaceutical research and development outweighed the public interest advanced by Apotex stating:
We have long acknowledged the importance of the patent system in encouraging innovation. Indeed, the “encouragement of investment-based risk is the fundamental purpose of the patent grant, and is based directly on the right to exclude.” … Importantly, the patent system provides incentive to the innovative drug companies to continue costly development efforts.
