Sunday, December 11, 2005

Article in 2005 Journal of Law and Policy on the CAFC decision in Merck v. Integra

In INTEGRA v. MERCK: EFFECTS ON THE COST AND INNOVATION OF NEW DRUG PRODUCTS, 13 J.L. & Pol'y 311, Alison Ladd explores the 2003 Federal Circuit decision (not the 2005 Supreme Court decision) in Merck v. Integra. Too little, too late?

The article notes: Although [the CAFC decision in] Integra may have brought the safe harbor back in line with Congress's original intent of allowing generic manufacturers swifter access to the marketplace, it has done so with serious detriment to innovative drug discovery. Congress clearly stated that one of the purposes of the Hatch-Waxman Act was to make available more low-cost generic drugs available. n259 It is clear, however, that Congress also intended to create a new incentive for increased expenditures for research and development. n260 The intended net effect of these two purposes is thrown off balance by Integra.

Without establishing clear guidelines regarding when innovative drug development may be protected by the safe harbor, Integra provides pioneer drug companies with little information as to when and for how long research tools must be licensed. This
uncertainty may result in the necessity to license access to these tools on the basis of reach-through royalties. Problematically, however, reach-through
royalties reduce a manufacturer's recovery of already-high research and
development costs. To avoid the high cost of accessing necessary research tools,
innovative companies may choose to perform innovative research abroad, given that
the importation of information resulting from overseas research activities
does not carry infringement liability. n264 Or worse yet, innovative companies
may choose not to conduct research at all.

The article does address the language "solely" in 35 USC 271(e)(1):
In Scripps Clinic & Research Found. v. Genentech, Inc., the Northern
District of California became the first court to consider the types of uses covered
by the safe harbor exemption. n79 The court focused on the "solely for"
language of section 271(e)(1). n80 The section, by its plain language, allows for
an infringement exemption for the use of a patented invention "solely for
uses reasonably related to the [*326] development and submission of
information under a Federal law which regulates the manufacture, use, or sale of
drugs or veterinary biological products."

Needless to say, the article in Journal of Law and Policy does not cite to my earlier article in JPTOS on Merck v. Integra.


Post a Comment

<< Home