Regional Seminar on multilateral legal framework and practice of patent protection in the pharmaceutical field
Peter R. Thomsen, IP Policy and Litigation
Issyk Kul, May 27&28, 2014

Aging population
The world’s population is aging. More healthcare treatments are needed, which is prompting payors to aggressively manage costs
Unhealthy lifestyles
Poor nutritional habits and sedentary lifestyles are increasing the prevalence of chronic diseases
Emerging markets
Economic growth in emerging countries is expanding access to healthcare
Advances in science and technology
New technological discoveries and trends are enabling the development of innovative medicines but also increasing the cost of innovation
2 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

Environment Patient needs
Originators
Innovative medicines
Prevention
Affordable options
Self medication
Full range of healthcare options
Generics
Over-The-Counter
Vaccines
3 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


Innovative drugs with substance patent protection
• Small chemical entities
• Biologics, e.g. antibodies

Requiring a prescription

Products available in pharmacies and hospitals

All kinds of mostly potentially severe medical conditions
• Oncology
• Cardiovascular
• Antibiotics and antivirals
4 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


Drugs which have lost (compound) patent protection

Generic product also needs marketing approval from
Health Authorities and needs to show to be safe and equally effective compared to originator reference product

Drugs requiring a prescription
• since around 10 years including follow-on biologics or biosimilars

Products available in pharmacies and hospitals in the same way originator products are available
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(over - the - counter)

Drugs typically without patent protection or with patent protection only for certain aspects of the formulation

Drugs requiring no or no longer a prescription

Usually for less severe medical conditions
• pain killer
• cough and cold
• allergy

Products available in drugstores and pharmacies
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
Products are antigens to stimulate the patient’s immune response

Antigen itself often not patent protected

But formulation, adjuvants, production processes, technology and combinations are patent protected

Prevention against severe infectious conditions, e.g.
• Influenza, including pandemic
• Against «children diseases»
• New generation of vaccines against e.g. cervical cancer

No significant generic activity (so far)

Products available in pharmacies and hospitals
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Cumulative cost per
Medicine: 800M
– 1.3B USD*
*: J Dimasi & H G Grabowski, “The Cost of Biopharmaceutical R&D: is Biotech Different?” Managerial and Decision
Economics No. 28 (2007): 469 –79 ; J Dimasi, R W Hansen, and H G Grabowski, “The Price of Innovation: New Estimates of
Drug Development Costs ,”Journal of Health Economics 22 (2003): 151–185.

10 years Data exclusivity t = 0 : Filing date of the basic “Active Ingredient” patent
Prosecution for grant
Marketing Approval (MA)
Patent: 20 Years
PTE/SPC: Patent
Term Extension
+ Up to 5 Years
Priority application
(1 year)
Generic entry
Publication
18 months
Around 7 to 12 years
Date of
Launch
8 to 13 years Market exclusivity
- First MA granted around 7-12 years after the filing date of the Basic Compound patent
- PTE/SPC is aimed to compensate a patent holder for time during regulatory review when he/she could not exploit the invention being the subject of the patent
9 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

Source: IFPMA
10 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

Innovation in the Pharmaceutical and Biotech field totally relies on sufficient protection by Intellectual
Property Rights

Patents

Regulatory Exclusivities
11 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

PCT=Patent Cooperation
Treaty: one application with an option to have patent in
148 countries
PCT P+30m
AR
BR
JP
EAPO
US
EP
P
TW
F=P+12M
+ other non-PCT country
EP= European Patent Convention: unified granting procedure for up to 38 countries
12 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

13 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

Molecules

Pharmacologic compound or active metabolite

Protein, DNA, or antibody
Processes

Manufacturing process

Purification method

Diagnostic processes
Compositions/formulations

New compositions of two or more ingredients

New formulations (e.g., extended release, gel, patch)
Specific forms of molecules

Enantiomers/Isomers

Polymorphs

Salts, Esters

Prodrugs
C
Other

Diagnostic tests

R&D-technology

Targets/biomarkers

Devices such as inhalers
New Uses/Indications
 compounds for use to treat disease
 methods of treatments
 new patient sub-groups
 dosage regimen
* A patent grants the right to exclude; right to market comes from other authorities (e.g., EMA)
14 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

Patent
Regulatory
Compound patent
Feb 91
NDA submission
Dec 95
NDA approval
Dec 96
First Para IV challenge to compound patent
Aug 07*
Expected Gx entry Sep 12
Discovery research
Development
Registration
Market exclusivity
Market competition
US Patent Expiry

Product, compound

Product, hydrates

Product, salts

Composition (Valsartan/Amlodipine)

Composition (Valsartan/HCTZ)**
Patent extensions for delays***

PTO
Jan 03
Jul 01
Jul 99
Jun 97
FDA exclusivity

Pediatric indication
* First Para IV filer converted later to a Para III
** 3 separate patents
*** No FDA delay compensation due to maximum total effective patent life of 14 years
Source: IMS, Evaluate Pharma, FDA Orange Book, interviews
15 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals
Mar 12
Sep 12

Case Example: Cyclosporin microemulsion
• Cyclosporin used in drug for immune suppression after transplantation
• Compound/indication patent for Cyclosporin expired 1995
• 1988 improved formulation invented with micro-emulsion
• Formulation patents filed and granted
Claims of Micro-emulsion patent:
“1. A pharmaceutical composition comprising a cyclosporin as active ingredient,
1) a hydrophilic phase,
2) a lipophilic phase, and
3) a surfactant, which composition is an oil-in-water microemulsion pre-concentrate."
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Case Example: Cyclosporin microemulsion (ctd)
• Patentee claimed patent infringement by a generic product in development by IVAX called «Equoral(R)»
Composition of Equoral(R) i) Cyclosporin (9%); ii) Polyglycerol (3) oleate (30%); iii) Polyglycerol (10) oleate (30%); iv) Macrogolglycerate hydroxystearate (27%);
Lipophilic phase ?
Surfactant v) Ethanol (15%);
Hydrophilic phase vi) Fatty acids (~1%); vii) [capsules only] D,L-( tocopherol (vitamin E, an antioxidant)(<1%).
• GB High Court found no separate lipophilic phase component and only 14% of Cyclosporin in micelles similar to a microemulsion
• Overall no oil-in water microemulsion and patent therefore not infringed!
• Confirmed in Court of Appeal (Novartis v Ivax [2007] EWCA Civ 971)
17 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


Protecting own R&D investments by obtaining and enforcing IP-rights

Ensuring Freedom-To-Operate against IP-rights of others
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
Enforcement of Patents in Court litigation very common
• To ensure a certain period of exclusivity
• To recuperate high R&D costs
• To push third parties to take licenses (rare for pharmaceuticals, more common for e.g. diagnostics)

Freedom-to-Operate
• To make sure patents of others are not infringed
• By legally designing-around the patents
• By invalidate potentially relevant third party patents
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-20.0%
-30.0%
-40.0%
-50.0%
-60.0%
-70.0%
-80.0%
-90.0%
-100.0%
Generic Erosion Comparison: Time Aligned
Trileptal Tab Erosion Zonegran Erosion Trileptal Total Erosion
0.0%
Pre-
Gx
Week
1
Week
2
Week
3
Week
4
Week
5
Week
6
Week
7
Week
8
Week
9
Week
10
Week
11
Week
12
Week
13
Week
14
Week
15
Week
16
Week
17
Week
18
Week
19
Week
20
Week
21
Week
22
Week
23
Week
24
Week
25
-10.0%
20 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

Simvastatin Germany
Hexal launched first Gx
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Q1
2003
Q3
2003
Q1
2004
Q3
2004
Q1
205
Q3
2005
HEXAL (HEXAL)
RATIOPHARM
(RATIOPHARM)
BETAPHARM (BETAPHARM)
STADA (STADA)
SANDOZ (SANDOZ)
CT ARZNEIMITTEL (CT
ARZNEIMITTEL)
1A PHARMA (1A PHARMA)
TAD (TAD)
AWD.PHARMA
(AWD.PHARMA)
ALIUD PHARMA (ALIUD
PHARMA)
MERCK DURA (MERCK
DURA)
BASICS (BASICS)

T
Process
Patent 1
Process
Patent 2
 If Development / TechOps would select “direct” approach
(red): probably being held infringing 3 patents

Patent Function:
• Identifying a way through and around protection of third party patents!
• Cannot design around compound patent (covers every form, use, production of compound)
22 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


Process and intermediate patents: find an alternative manufacturing process that is not likely to be held infringing

Indication patents: consider carving-out of labeling and marketing authorization

Formulation patents: find an alternative formulation that meets regulatory requirements (Bioequivalency) but is not likely to be held infringing
23 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


GSK held patent on special formulation of cefuroxime axetil having a film-coating:

Gx developed a Cefuroxime Axetil tablet being bioequivalent but having a non-film coating

Gx product was launched well before expiry of film-tablet
GSK patent and
24 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


GSK sued and asked for a preliminary injunction (PI)

Court refused PI and Gx could stay on the market

GSK withdrew claim on patent infringement of film-coating tablet
25 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


Glaxo tablet-coating embodiment film-forming agent

Sandoz tablet-coating embodiment
No film-forming component
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27 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


Patent infringement litigation started by patentee in view of actual or imminent launch of an allegedly infringing product

Request for Declaratory Judgement of Noninfringement started by alleged infringer

Revocation action started by potentially alleged infringer
• Administrative route, e.g. opposition
• Court route

Formal linkage between patent status and ability of
Health Authorities to issue generic marketing authorization («patent linkage»)
28 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals

Key elements of strong IP-regime
• Complying with standards set by international agreements
- TRIPS, PLT and PCT, Paris Convention, Madrid Agreement/Protocol
• Limited Exclusions from Patentability, e.g. for biotechnological inventions
• Efficient procedures to examine and grant patents and trademarks
• Strong Court system allowing effective enforcement of IP-rights
- availability of timely preliminary measures
- Enforceability of court decisions
- Ideally specialized IP-Courts
- Possibility to have patent validity re-examined
• Availability of Trademark protection
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Key elements of strong national IP-regime (contd)
• Willingness of local authorities to combat against counterfeiting
- Customs
• Regulatory Data Exclusivity
- Sufficiently long period
- to protect regulatory data from being disclosed and being referred to by unauthorized third parties
• Possibility to obtain patent term extensions to compensate for regulatory delays
- E.g. for up to 5 years
30 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals


Different drug businesses use patents in different ways

Establishing and maintaining strong national IPR-regimes is essential to ensure that companies can continue to undertake the costly and risky R&D process to develop next generations of innovative medicines and vaccines

Intellectual property rights can also stimulate technology transfer and building of technical skills within developing countries and fuel economic growth

Robust national procedures to obtain and enforce IP-rights such as patents, trademarks and regulatory data exclusivity

Also for generic sector efficient mechanisms to decide on patent disputes are important , e.g. on non-infringement or validity of granted patents in the interest of legal and business certainty

Many barriers exist that prevent access to healthcare and medicines, including lack of sustainable financing and inadequate infrastructure and supply systems.
It is critical to address the entire health system in order to improve health outcomes
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peter_r.thomsen@novartis.com
32 | Practice of Patent Protection in Pharma | P.R. Thomsen | May 27, 2014 | Role of Patents for pharmaceuticals