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Merck & Co. v. Apotex, No. 2008-1133 (Fed. Cir. 2008)

In 2005, Hi-Tech Pharmacal (NASDAQ:HITK) became the first company to file a paragraph IV certification relating to Merck's (NYSE:MRK) glaucoma drugs Trusopt and Cosopt. Hi-Tech filed paragraph IV certifications with respect to all three of the Orange Book-listed patents for these drugs: U.S. Patent Nos. 4,797,413; 6,248,735; and 6,316,443.

In response, Merck sued Hi-Tech for infringing the '413 patent. Merck did not assert the '735 and '443 patents against Hi-Tech, but instead disclaimed the patents under 35 U.S.C. §253. Last year (as reported here), the Federal Circuit affirmed a district court decision in favor of Merck and against Hi-Tech, causing Hi-Tech to be enjoined from marketing its generic versions of Trusopt and Cosopt until October 28, 2008, when the '413 patent (plus six months of pediatric exclusivity) will expire. Although Hi-Tech lost the case, it retained its 180-day exclusivity on Trusopt and Cosopt due to its paragraph IV certifications against the '735 and '443 patents.

In 2006, Apotex filed its own ANDA for generic versions of Trusopt and Cosopt.  Like Hi-Tech, Apotex included paragraph IV certifications against all three Orange Book-listed patents. Merck sued Apotex for infringing the '413 patent and Apotex counterclaimed for a declaratory judgment of noninfringement and invalidity of the '735 and '443 patents (notwithstanding that Merck had disclaimed them). Apotex agreed to be bound by the results of Hi-Tech's appeal to the Federal Circuit on the '413 infringement issue, and thus, like Hi-Tech, became enjoined until October 28, 2008.

On November 15, 2007 (as reported here), the district court dismissed Apotex's counterclaims relating to the '735 and '443 patents for lack of subject matter jurisdiction.  In an opinion released August 21, the Federal Circuit affirmed the dismissal.

The Federal Circuit observed that Apotex pursued its counterclaims under the

theory that if it can obtain a final judgment in its favor (invalidity or non-infringement) on these patents, such a judgment would act as a forfeiture trigger should Hi-Tech fail to market its generic version of Cosopt within 75 days of the date of Apotex's final judgment.

According to the court,

since Hi-Tech is enjoined from marketing its generics any time before October 28, 2008, Apotex asserts that a final judgment of invalidity or non-infringement as to the '735 and '443 patents obtained on or before August 14, 2008 would create a forfeiture of exclusivity for Hi-Tech and would allow Apotex to market its competing generic immediately upon final approval of its ANDA.

The Federal Circuit applied the standard for declaratory judgment jurisdiction enunciated in MedImmune: the dispute must be

definite and concrete, touching the legal relations of parties having adverse legal interests; . . . real and substantial, and admit of specific relief through a decree of a conclusive character, as distinguished from an opinion advising what the law would be upon a hypothetical state of facts.

Here, the court found that as a practical matter, it could not provide any realistic relief:

Even with prompt action by this panel, the final judgment sought by Apotex cannot be provided in time to be meaningful.

Accordingly, the court concluded,

the dispute presented does not 'admit of specific relief through a decree of a conclusive character' and, thus, does not present a justiciable case or controversy.

Source: Federal Circuit Affirms Merck’s Victory in Trusopt/Cosopt Case