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Federal Circuit Provides Clarity For Contract Manufacturing On-Sale Invalidity Claims

By Daniel Melman
August 01, 2016

In The Medicines Company v. Hospira, Inc., App. No. 14-1469, 14-1504 (Fed. Cir. July 11, 2016) (slip op.) (en banc), the Federal Circuit provided clarity and guidance to companies that rely on contract manufacturing, holding that “to be 'on sale' under '102(b), a product must be the subject of a commercial sale or offer for sale, and that a commercial sale is one that bears the general hallmarks of a sale pursuant to Section 2-106 of the Uniform Commercial Code.” Id. at 3.

The case arose in the context of Hospira's Abbreviated New Drug Application (ANDA) submissions seeking FDA approval to sell generic versions of The Medicines Company's (TMC) Angiomax', an anticoagulant used in heart surgery. In the ensuing litigation, alleging that Hospira's ANDA submissions infringed two of TMC's patents, Hospira raised several grounds of invalidity, including that TMC's inventions were sold or offered for sale before the critical date under '102(b).

TMC is a specialty pharmaceutical company that does not have its own manufacturing facilities. Therefore, it contracted with a third-party provider, Ben Venue Laboratories (Ben Venue), to manufacture commercial quantities of Angiomax'. The active pharmaceutical ingredient in Angiomax', bivalirudin, is an acidic compound that requires processing before it can be injected into patients. A potential adverse effect of the compounding process used to adjust bivalirudin's pH is the formation of certain impurities such as Asp9-bivalirudin. Id. at 4-5. In June 2005, Ben Venue manufactured a batch of bivalirudin with an Asp9 level that exceeded the FDA's allowable limit. In 2006, another batch was manufactured that again had an unacceptable level of Asp9. TMC's subsequent investigation to resolve the issue led to the development of a new compounding process. U.S. Patent Nos. 7,582,727 (the '727 patent) and 7,598,343 (the '343 patent) contain product and product-by-process claims for pharmaceutical batches of the improved drug product with a maximum Asp9 impurity level of 0.6%. The applications for the '727 and '343 patents were filed on July 27, 2008. Thus, the critical date for purposes of the on-sale bar of '102(b) is July 27, 2007. Id. at 5-6.

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