Summary Judgment in Seroquel Case Favors AstraZeneca; Teva and Sandoz to Appeal

Includes: AZN, TEVA
by: Aaron F. Barkoff

AstraZeneca v. Teva Pharms. USA and Sandoz, No. 05-5333 (D.N.J. 2008)

On July 1, the U.S. District Court for the District of New Jersey granted AstraZeneca's (NYSE:AZN) motion for summary judgment that its patent on quetiapine fumarate, the active ingredient in Seroquel, is not unenforceable for inequitable conduct.  The decision disposed of the last remaining issue in the case, as Teva (NYSE:TEVA)  and Sandoz, which are challenging the patent, had already conceded infringement and validity.

The district court's opinion explained that Seroquel, which is indicated for the treatment of schizophrenia and bipolar disorder, is in a class of drugs known as "atypical antipsychotics."  According to the opinion, early ("typical") antipsychotic medications were plagued by undesirable side effects, including acute dyskinesias (uncontrollable muscle movements).  In 1985, Astra scientists discovered quetiapine, which showed reduced potential to cause dyskinesias, and in 1989 Astra was issued U.S. Patent No. 4,879,288 on the compound.

Teva and Sandoz offered four arguments for the unenforceability of the '288 patent:

  • Astra misrepresented and/or omitted material information concerning certain prior art compounds in its prosecution of the '288 patent;
  • In response to a request by the patent examiner, Astra falsely asserted that generating data regarding a particular prior art compound would have been "very expensive";
  • Astra deceived the PTO by representing that a record reference taught that a particular compound was a typical antipsychotic; and
  • Astra failed to disclose to the PTO the death of a cebus monkey during testing of quetiapine.

The district court rejected each of these arguments, concluding that the information allegedly withheld or misrepresented by Astra during prosecution of the '288 patent was not sufficiently material to support a finding of inequitable conduct.

In addition, the court rejected as a "facile argument" the defendants' suggestion that a trial is necessary "in order for the parties to present expert testimony and to allow the court to make credibility determinations with respect to fact witnesses."  According to the court, "there are no credibility determinations to be made here; the prosecution record speaks for itself.  Moreover, experts engaging in hindsight cannot change the facts and circumstances of the patent application process that occurred two decades ago."

Seroquel is Astra's best-selling drug, with global sales of $4 billion last year (accounting for 10% of Astra's revenues) and annual U.S. sales of $3.5 billion.  Teva and Sandoz have announced their intention to appeal the district court's decision to the Federal Circuit.  The '288 patent is currently set to expire in 2011, though pediatric exclusivity could extend Astra's protection until 2012.