Locke Lord QuickStudy: Federal Circuit Places “Skinny Labels” in Danger

Locke Lord LLP
October 15, 2020

Section viii of the Hatch-Waxman Act, 21 U.S.C. § 355(j)(2)(A)(viii), allows a generic applicant to “carve out” indications and other use information from its labeling that are protected by patents listed in FDA’s Orange Book if the reference listed drug has been approved for other indications or uses.  The resulting label, commonly called a “skinny label,” permits FDA to approve the generic applicant’s ANDA for only the specific indications and uses that have not been carved out.  Id. at 27.  In a long line of cases, the Federal Circuit has repeatedly held that a generic manufacturer’s marketing of a product under a skinny label would not induce infringement of patents for carved out uses, even if those uses were known by physicians or common uses for the product.  See Warner-Lambert v. Apotex Corp.,‎ ‎316 F.3d 1348, 1360 (Fed. Cir. 2003) (quoting the legislative history and concluding that “Congress recognized that a single drug could have more than one indication and yet that the ANDA applicant could seek approval for less than all of those indications”); see also Allergan, Inc. v. Alcon Labs., 324 F.3d 1322, 1324 (Fed. Cir. 2003); see also AstraZeneca Pharms. LP v. Apotex Corp., 669 F.3d 1370, 1378 (Fed. Cir. 2012).‎

On October 2, 2020, the Federal Circuit reversed course, issuing a precedential opinion vacating a district court’s judgment as a matter of law and reinstating a jury verdict finding induced infringement of a patented use that had been carved out of a generic applicant’s label.  GlaxoSmithKline LLC v. Teva Pharms. USA, Inc. (Teva II), Nos. 2018-1976, 2018-2023, slip op. (Fed. Cir. Oct. 2, 2020).

At issue in the case was whether Teva’s marketing of carvedilol first with a skinny label, and later an amended label including the carved out indication as required by FDA, induced infringement of GSK’s reissue patent, RE40,000 (“the ’000 patent”).  Id. at 22.

GSK’s branded carvedilol product, Coreg®, was first approved by FDA in 1997 for treating hypertension and congestive heart failure (“CHF”).  Id. at 28.  Later, in 2003, a third indication, post-myocardial infarction left ventricular dysfunction (“post-MI LVD”), was approved and added to Coreg®’s label.  Id.  Post-MI LVD affects patients that have recently suffered heart damage from a heart attack.  Id.

After March 2007, GSK’s only Orange Book-listed patents, including the patent that would be reissued as the ’000 patent, related to using carvedilol to treat CHF.  Id.  There were no Orange Book-listed patents related to the treatment of hypertension or post-MI LVD.  Id.

Teva initially carved out the CHF indication from its proposed label. Id. at 29.  In September 2007, when FDA approved Teva’s generic carvedilol product, the only indications in Teva’s skinny label were for hypertension and post-MI LVD—neither of which was covered by an Orange Book-listed patent.  Years later, in 2011, Teva revised its label to include the CHF indication at FDA’s direction.  Id. at 32.

In July 2014, GSK filed suit against Teva for induced infringement of the ’000 patent.  Id. at 6.  Following a seven-day trial, the district court jury found that Teva induced infringement of the ’000 patent during both the skinny label period and the period after Teva revised its label to include the CHF indication.  GlaxoSmithKline LLC v. Teva Pharms. USA, Inc. (Teva I), 313 F. Supp. 3d 582, 589 (D. Del. 2018).  In overturning the jury verdict, the district court held that as a matter of law, the jury could not reasonably have found that Teva caused prescribers to infringe the ’000 patent during the skinny label period, and that GSK failed to prove that prescribers relied on the 2011 revision to Teva’s label in making their prescribing decisions.  Id. at 589-598.

On appeal to the Federal Circuit, the majority, citing only to circumstantial evidence, found the evidence substantial enough to support the jury’s finding of induced infringement during the skinny label period.  Teva II, slip op.. at 18, 42.  The circumstantial evidence cited by the majority includes press releases and product catalogs published by Teva.  Id. at 42.  Both of the press releases cited by the majority were published before the issuance of the ’000 patent but remained on Teva’s website throughout the life of the ’000 patent.  Id. at 15.  Neither the press releases nor the product catalogs make any mention of treating CHF.  Id. at 13, 29.  Rather, the press releases are directed to FDA’s grant of tentative and final approval, respectively, for Teva’s generic carvedilol product, and the product catalogs merely list Teva’s carvedilol product as generic for Coreg®.  Id. at 13, 15.  The majority, citing to precedent not directed to skinny labels, further held that “the ‘content’ of Teva’s skinny label alone was sufficient to prove induced infringement—even though Teva’s skinny label did not encourage, promote, recommend, or even suggest the patented method.” 16, 23.  In so finding, the majority suggested that intent to induce infringement could be found based on the fact that Teva “deliberately” carved the CHF indication out of its label.  Id. at 14.

In a lengthy dissent, Chief Judge Prost set up a possible avenue for en banc rehearing by the Federal Circuit or Supreme Court review by arguing that “[t]he Majority’s holding that the content of Teva’s skinny label can itself establish inducement nullifies Congress’s provision for skinny labels.  The Majority is wrong as a matter of law.”  Id. at 37.  Criticizing the majority, Chief Judge Prost pointed out that because, other than the skinny label itself, the only documentary evidence the majority cited in finding induced infringement of the ’000 patent during the skinny label period were press releases and product catalogs, the “inferences required to reach a finding of inducement [from this evidence] exceed the bounds of reason.”  Id. at 48.  Chief Judge Prost further criticized the majority for upending years of precedent, including Warner-Lambert v. Apotex, and offered that the majority’s opinion frustrated Congress’s intent in enacting the Hatch-Waxman Act by allowing “one patented method to discourage generics from marketing skinny labels—thus, slowing, rather than speeding, the introduction of low-cost generics.”  Id. at 23.

Based on the majority opinion and dissent, there will likely be further litigation defining the extent, if any, to which generic applicants may be held liable for infringement relating to indications carved-out of their skinny labels.  At this time, however, ANDA applicants choosing to rely on section viii carve outs as a means of avoiding patented indications or uses will need to consider carefully whether extraneous information, such as press releases or product catalogs, could put them at risk for an infringement claim regardless of the information set forth in their skinny labels.