In a recent 2-1 decision after a rehearing, GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc. (No. 2018-1976), the Federal Circuit confirmed that substantial evidence supported the jury's findings of induced infringement throughout the term of GSK's patent, including the "partial label period" when Teva used a skinny label to carve out a patented method.

The case arose from GSK's carvedilol drug, which was approved for three indications including hypertension, congestive heart failure (CHF) and left ventricular dysfunction following a myocardial infarction (post-MI LVD). In 2002, Teva submitted an Abbreviated New Drug Application (ANDA) for approval of its generic version not to be launched until the expiration of the patent on the compound in 2007. Teva certified invalidity under Paragraph IV of U.S. Patent No. 5,760,069, which was reissued in 2008 as RE 40,000 ('000 patent), covering "a method of decreasing mortality caused by congestive heart failure in a patient in need thereof" comprising administration of a carvedilol combination "to said patient daily maintenance dosages for a maintenance period," which is "greater than six months."

In 2004, Teva issued a press release after its ANDA was tentatively approved. In 2007, Teva launched its generic product and issued a second press release. Teva used a skinny label including two indications only?hypertension and post-MI LVD?and carved out the patented indication CHF as authorized in 21 U.S.C. § 355(j)(2)(A)(viii). In 2011, when required by the FDA to have a full label, Teva amended its label to include treatment of heart failure (i.e., CHF).

In 2014, GSK sued Teva for induced infringement of the '000 patent. The jury found Teva induced infringement and awarded GSK $235 million in damages. The district court granted Teva's motion for judgment as matter of law and overruled the verdict. In October 2020, on appeal, the Federal Circuit overturned the district court's decision. In this 2021 decision following a motion for rehearing, the Federal Circuit panel confirmed its original 2020 decision.

A plaintiff must show a defendant's specific intent to encourage another's infringement to establish a finding of induced infringement. Intent can be proved through circumstantial evidence. The Federal Circuit's opinion centers on an analysis of the evidence, including expert testimony for inferring Teva's intent. For the partial label period, the court majority agreed with GSK that Teva's partial label encouraged an infringing use of the patented indication (i.e., CHF) via the post-MI LVD indication on the label; and that Teva's marketing materials encouraged prescribing carvedilol in a manner causing infringement of the '000 patent.

First, the court majority concluded that substantial evidence supported that the partial label's indication for post-MI LVD did not effectively carve out the patented use. During the trial, GSK's cardiology expert provided element-by-element testimony. Teva's partial label stated that "[c]arvedilol is indicated to reduce cardiovascular mortality" in post-MI LVD patients. GSK's expert stated such a label satisfied the limitation of "decreasing mortality caused by congestive heart failure in a patient in need thereof" as recited in the '000 patent; and post-MI LVD is "intertwined with heart failure." Teva's expert agreed that a post-MI LVD patient as recited on the partial label would be diagnosed as suffering from congestive heart failure. The majority pointed out that whether the post-MI LVD indication instructed a physician to prescribe carvedilol for the claimed use is a question of fact, and that the district court erred in treating it as a legal question to decide de novo after the jury's finding.

Teva argued that GSK failed to identify the post-MI LVD use in its submission to the FDA for Orange Book listing, and such a failure was at odds with GSK's infringement allegations and created equitable estoppel. The court majority stated that the FDA does not determine patent infringement and the estoppel issue had not been tried. Additionally, the majority relied on Teva's press releases, product catalog and other promotional materials, which described the equivalence of Teva's carvedilol to GSK's drug. Teva's 2007 press release, posted before the issuance of the '000 patent, remained on Teva's website throughout the patent term. The majority concluded substantial evidence supported the jury's finding of induced infringement for both the partial and full label periods, with causation.

Judge Sharon Prost issued a strong dissenting opinion stating that the majority weakened the intent requirement for induced infringement, eviscerated the causation requirement and created confusion about using skinny labels.

Addressing public concerns, the majority stated, "This narrow case-specific review of substantial evidence does not upset the careful balance struck by the Hatch-Waxman Act" regarding the carveouts. However, this case still brings uncertainty and confusion about skinny labels. A generic company may need to perform technical and legal analysis to ensure that a skinny label fully carves out a patented use, especially when a patented indication and a labeled indication are possibly intertwined with each other. In addition to drug labels, any promotional materials such as press releases, product catalogs and websites need to be scrutinized.

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