The Final Word on an Alleged Infringer’s Intent in a Hatch-Waxman Safe Harbor Analysis

Background

We have been monitoring the dispute between Edwards Lifesciences Corp. (“Edwards”) and Meril Life Sciences Pvt., Ltd. (“Meril”) before¹ and after² the initial Federal Circuit decision.³

The dispute focused on whether Meril’s importation of two transcatheter heart valve systems to display at an industry conference fell within the Hatch-Waxman safe harbor. Neither system was used or even displayed at the conference. The Federal Circuit, with Judge Lourie dissenting, affirmed the lower court’s decision that the accused conduct was protected by the safe harbor.³ Edwards then sought reconsideration and en banc review; both of which were recently denied.⁴ As this ruling will be last word on the issue, absent an unlikely Supreme Court review, we thought it useful to summarize the positions raised by Edwards and Meril one last time.

Applicable statute

Because the arguments rely heavily on the precise wording of the Hatch-Waxman safe harbor, the pertinent section is set forth below:

It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention… solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs or veterinary biological products.⁵

Edwards’ argument

As before, Edwards argued that the court misread the applicable statute, namely the interpretation of the word “solely.” According to Edwards, “any protected use automatically insulates all non-protected uses. If ‘a use’ is covered, the safe harbor applies, sweeping in ‘alternative uses’ irrelevant to regulatory approval.”⁶ Thus, “[s]o long as some ‘use’ qualifies for protection, everything is protected.”⁷ In essence, Edwards argued that the Federal Circuit has deleted the term “solely” from the statute.

Regarding “solely,” “[t]he majority acknowledged the term ‘solely’ [is] in the statute, but still disregards that ‘the use must only’ concern regulatory approval.”⁸ Rather, the majority found “‘the relevant inquiry’ is ‘whether the act of importation was for use reasonably related to submitting information to the FDA.’”⁸ Since the “court found that Meril had identified at least one such qualifying use,” Meril’s importation was within the safe harbor.⁹

In view of the court’s majority decision, Judge Louie dissented and stated that the Federal Circuit’s holding “perpetuates the failure of the court and others to recognize the meaning of the word ‘solely’ in interpreting §271(e)(1).”¹⁰

Meril’s position

Meril enumerated the significant steps it had taken toward obtaining FDA approval for its valve systems before the conference.¹¹ The conference was integral to those efforts, e.g., selecting qualified investigators for clinical testing. It is somewhat unclear how this factor was relevant to the final decision.

Meril emphasized the court’s holding on the term “solely,” i.e., “for each act of infringement the safe harbor is available only [“solely”] for acts that bear a reasonable relation to the development and submission of information to the FDA.”¹² Since there was only one use — importation of the two devices, and that use was reasonably related to the statutory purpose of § 271(e)(1) — the safe harbor applied.¹³ Meril then emphasized the court’s holding that the act focuses “on uses” and not “underlying purposes or attendant circumstances of the activity.”¹⁴ Emphasizing that each act of alleged infringement is separately evaluated, Meril cited Amgen, Inc. v Hospira, Inc.,¹⁵ where only seven of the 21 manufactured batches were protected by the safe harbor.¹⁶

Conclusion

In denying Edwards’ motions, the Federal Circuit essentially reiterated its prior holdings. Thus, the law is and remains clear: (1) an alleged infringer’s intent is irrelevant in determining whether the Hatch-Waxman safe harbor applies; and (2) each use is separately evaluated in making such determinations.