Over a year ago, I took a look at a study of the success rate for inter partes reviews (IPRs) of pharmaceutical patents. That study showed that drug and biologic patents are significantly more likely to be upheld at the PTAB than the average patent.
Recently, there’s been a wave of additional studies looking at this issue, confirming that what we saw a year ago is still true—drug patents are successfully upheld in IPRs at a significantly higher rate.
How Successful Are Pharmaceutical IPRs?
The first study was conducted by a pair of Harvard Medical School professors, as well as a professor at the University of Calgary. The Harvard study examined all pharmaceutical IPRs through April 2017.
The second study, by a recent Northwestern J.D., extended its dataset to all pharmaceutical IPRs over a 6 year period from March 2012 to March 2018.
Both drew similar conclusions regarding the success rate of pharmaceutical IPRs. Pharmaceutical IPRs are relatively rare, around 5% of all IPRs, and similarly to non-pharmaceutical patents, pharmaceutical IPRs usually relate to patents that are also being litigated in district court.1
Looking beyond their frequency, pharmaceutical IPRs are quite different from the average IPR. While pharmaceutical IPRs are instituted at roughly similar rates to other IPRs, they are significantly less likely to find some or all claims invalid if they are instituted. Of the 134 distinct drugs (covered by 198 distinct patents) challenged in the Harvard study, only 44 drugs received at least one final written decision. And of those 44 drugs, only 18 (13%) had all of their claims invalidated—and even then, all but 2 of those drugs still had other patents protecting the drug.
When Are Patents Challenged?
In addition to patent protection, new drugs receive a separate form of protection called New Chemical Entity (NCE) exclusivity. NCE exclusivity extends for 5 years after the drug is approved, regardless of whether a patent on the drug exists, and prevents others from marketing their own drug using that active ingredient.
The Northwestern study makes an interesting point about this type of exclusivity. Of the 412 IPRs against pharmaceutical patents filed in the 6 year period of the study, only 11 were filed against drugs within the NCE exclusivity period. While this shouldn’t be surprising—there’s limited reason for drug makers to challenge a drug patent when they would still be prevented from selling the drug by the NCE exclusivity—it also illustrates the fact that the pharmaceutical industry has meaningful protections that go beyond patent protection.
What Patents Are Actually Challenged?
The Harvard study drew one particularly interesting conclusion—the patents that are being challenged aren’t the ground-breaking patents that are commercially critical. Instead, the challenged patents tend to be either formulation patents that cover the combination of an active ingredient with inactive binders for delivery or method of use patents that cover how the active ingredient is used.
In fact, only 17% of challenged pharmaceutical patents covered the active ingredient of a drug. And only 2 active ingredient patents (approximately 1% of all challenged pharmaceutical patents) had all of their claims invalidated.
This suggests that the key use for IPRs in pharmaceuticals has been to challenge the kind of follow-on patents that pharmaceutical companies use to try to extend protection of their key active ingredients, rather than the innovator patents that claim newly created pharmaceuticals.
What Does This Mean For The IPR System?
Given that pharmaceutical IPRs are rare and generally less successful than other IPRs, the notion that the IPR system represents a serious threat to the Hatch-Waxman balance between new and generic drugs does not appear to be correct.
Instead, the IPR system appears to be mostly used to trim back the scope of follow-on patents that attempt to extend the original drug monopoly in order to make sure generics can enter once that original patent expires. This would appear to be completely consistent with the goals of Hatch-Waxman—ensuring that the original innovation is protected, but allowing for generics to efficiently provide that innovation after the original period of protection ends.
Given these recent studies, as well as others (such as the PTO’s Orange Book study), it does not appear to be necessary to modify the IPR process to accommodate the Hatch-Waxman process.
- I will note that, from anecdotal conversations with pharmaceutical industry lawyers, IPRs are often not filed by the generic company that is involved in the litigation but by third party generic companies. Neither study addresses whether the litigant is also the IPR filer in pharmaceutical IPRs. ↵