Endo Pharms. Inc. v. Amneal Pharms. LLC

Robins Kaplan LLP

Robins Kaplan LLP

January 23, 2017

Case Name: Endo Pharms. Inc. v. Amneal Pharms. LLC, Civ Nos. 14-1382-RGA, 14-1389-RGA, 2016 U.S. Dist. LEXIS 140112 (D. Del. Oct. 7, 2016) (Andrews, J.) 

Drug Product and Patent(s)-in-Suit: Opana® ER (oxymorphone hydrochloride); U.S. Patent No. 8,871,779 (“the ’779 patent”)

Nature of the Case and Issue(s) Presented: There are two molecules at issue in this case. The first is 14-hydroxydihydromorphinone, also referred to as “oxymorphone” and the other is 14-hydroxymorphinone, also referred to as “oxymorphone ABUK.” ABUK stands for alpha, beta-unsaturated ketone, a known organic impurity having a carbon-carbon double bond next to the ketone group. Oxymorphone was first patented in 1955 and first approved by the FDA in 1959. Prior to 2002, oxymorphone manufacturers were aware of the presence of ABUK. During the period before 2002, manufacturers regularly sold oxymorphone with ABUK levels in the range of hundreds of parts per million (“ppm”). In 2002, the FDA informed plaintiffs and several other manufacturers that it was concerned about the levels of ABUK in certain products, and that it intended to impose limits on ABUK levels as low as 0.001 percent (or 10 ppm). In 2004, the FDA mandated that opioid manufacturers lower the levels of ABUK in opioid pharmaceuticals to less than 10 ppm. In 2005, plaintiffs made low-ABUK oxymorphone and applied for a patent on its new product. The application ultimately issued as the ’779 patent. The asserted claims of the ’779 patent4 are all composition claims directed to low-ABUK oxymorphone.

Both Amneal and Teva conceded that their proposed products infringed. Teva contended, however, that because it obtained an implied license from plaintiffs, it did not infringe. Both defendants argued that the ’779 patent was invalid as obvious. The court found in favor of plaintiffs.

Why Plaintiffs Prevailed: The scope and content of the prior art centered on two references: Weiss and Chapman. Weiss describes the process of hydrogenating oxymorphone ABUK, thereby converting it into oxymorphone HCl. But Weiss does not provide the all of the reaction conditions required to reproduce the described reaction. Specifically, Weiss lacks details about hydrogen pressure, amount of acid, amount and composition of catalyst, and reaction time. Moreover, Weiss does not provide any information about the level of oxymorphone ABUK or other impurities remaining after hydrogenation. Finally, analytical methods available at the time of Weiss (1957) would only have been able to determine the remaining ABUK levels in the hundreds of ppm. Chapman does not discuss oxymorphone; rather, it describes a process for using hydrogenation to convert oxycodone ABUK into oxycodone. Chapman uses a “double hydrogenation” process that involves an initial step of hydrogenating oxycodone ABUK, resulting in oxycodone which still contains relatively high levels of oxycodone ABUK. Then, the oxycodone product from the first step is hydrogenated again under specific parameters, producing oxycodone with less than 25 ppm of oxycodone ABUK.

Amneal’s expert testified that carrying out a hydrogenation experiment, like that in Weiss, for a long enough time would result in the claimed low-ABUK oxymorphone, and that the result in Chapman, although on a different, related molecule, would give a skilled artisan a reasonable expectation of success. The court faulted Amneal’s expert because there was no indication, and certainly no experimental evidence, that the hydrogenation procedure described in Weiss could result in ABUK levels below 10 ppm. The court found that at the time of the invention it was “very unusual” and “remarkable” to achieve impurity levels down to 10 ppm. Amneal’s expert’s opinion did not account for the fact that oxymorphone had numerous impurities, aside from the ABUK, the most important of which is oxymorphone diol. Oxymorphone diol becomes hydrated and converts back into oxymorphone ABUK. This was described at various times as the “reappearing ABUK.” This regeneration is significant, since the FDA requires, and the ’779 patent claims, such low levels of oxymorphone ABUK. Although Weiss discloses a method for removing oxymorphone diol from his starting material for the hydrogenation reaction, the court credited Plaintiffs’ expert’s opinion that Weiss does not “completely remove the compound you’re trying to wash away.” Concerning Chapman, the court found that its hydrogenation procedure differs from Weiss in some critical respects. Most importantly, Chapman describes the hydrogenation of oxycodone, rather than oxymorphone. While related, the evidence demonstrates that oxycodone and oxymorphone react in different ways. These differences are attributable to certain structural variations. Oxycodone and oxycodone ABUK contain anisole, a benzene ring with an OCH3 (methoxy) group attached. Oxymorphone and oxymorphone ABUK, on the other hand, contain phenol, a benzene ring with an OH (hydroxy) group attached.

The court found that neither Weiss nor Chapman actually suggested to one of ordinary skill in the art how to make the claimed apparatus with a reasonable likelihood of success. Neither Weiss, nor Chapman, disclose low-ABUK oxymorphone. Additionally, Amneal and Teva did not prove that the combination of those references would enable a person of ordinary skill to make low-ABUK oxymorphone with a reasonable expectation of success. Although the Chapman inventors succeeded in creating low-ABUK oxycodone with a double hydrogenation process, due to the differences between oxycodone and oxymorphone, that would not suggest to a person having ordinary skill that the same process would have been effective in creating low-ABUK oxymorphone. Therefore, Defendants failed to prove prima facie obviousness.

Next, the court addressed Teva’s implied license defense. Teva and plaintiff Mallinckrodt, in 2008, entered into a supply agreement for the supply of non-low-ABUK oxymorphone to Teva. That agreement expired in 2009. In late 2010 and early 2011, Teva purchased two batches of low-ABUK oxymorphone from Mallinckrodt pursuant to stand-alone purchase orders. Those purchase orders were dated October 31, 2010 and February 3, 2011, respectively. Mallinckrodt shipped the requested quantities of low-ABUK oxymorphone API, and Teva paid Mallinckrodt the amount due. Since those purchase orders, Teva has not purchased any low-ABUK oxymorphone API from Mallinckrodt. In February 2012, Teva requested a Letter of Authorization (“LOA”) for low-ABUK oxymorphone API from Mallinckrodt. On March 8, 2012, Mallinckrodt sent a copy of an LOA for low-ABUK oxymorphone API to Teva. This LOA allowed the FDA to review, in connection Teva’s ANDA filing, the information contained in Mallinckrodt’s Drug Master File, without Mallinckrodt having to share that information with Teva. On April 17, 2012, Teva submitted an ANDA to the FDA, requesting approval for its generic version of Opana ER. Teva incorporated Mallinckrodt’s DMF into its ANDA. Mallinckrodt is the only supplier of low-ABUK oxymorphone API referenced in the Teva CRF ANDA. In August 2012, Mallinckrodt and Teva began negotiating a supply agreement for low-ABUK oxymorphone API. The parties never reached an agreement for the supply of low-ABUK oxymorphone API. On November 7, 2014, less than two weeks after the issuance of the ’779 patent, Endo and Mallinckrodt sued Teva for infringement of the ’779 patent.

Teva’s implied license defense relates only to API which may be supplied by Mallinckrodt. According to Teva, since Mallinckrodt is the only API supplier identified in its ANDA, the product that is likely to be sold will contain Mallinckrodt API. Teva argues that it must be entitled—or, impliedly licensed—to use low-ABUK oxymorphone API that it receives from Mallinckrodt. To succeed, Teva must show that Mallinckrodt consented to Teva’s use of the patented invention in the product likely to be sold. The court did not so find. The 2010 and 2011 purchase orders concerned discrete, stand-alone purchases. By the terms of the purchase orders, Mallinckrodt granted Teva permission to use the low-ABUK oxymorphone API however it wished. As the terms and conditions of the purchase orders make clear, however, the scope of that permission does not extend beyond the “manufacture of goods covered by th[e] [purchase] order.” The only material covered by the terms and conditions is the low-ABUK oxymorphone API Teva actually purchased. No evidence suggests that, by selling low-ABUK oxymorphone API to Teva on two occasions, Mallinckrodt consented to Teva’s commercial sale of products embodying the ’779 patent through the use of low-ABUK oxymorphone API not covered by the purchase orders. The two purchases of low-ABUK oxymorphone API do not create an implied license. Next, because the LOA places no binding obligation on Mallinckrodt, it would have no reason to withdraw the LOA. Additionally, leaving the LOA in place allows the FDA to review Teva’s ANDA while Teva seeks to find, and qualify, additional suppliers of low-ABUK oxymorphone API. This is standard within the industry, as ANDA applicants seek to qualify multiple suppliers for pharmaceutical products. Mallinckrodt is not, however, suing Teva for using the low-ABUK oxymorphone API it previously supplied. Rather, Mallinckrodt is suing Teva for including low-ABUK oxymorphone API in the product that is likely to be sold in the future. Teva has not pointed to any evidence demonstrating that Mallinckrodt granted Teva a license to include low-ABUK oxymorphone API in the ANDA product it ultimately sells. “That is a fatal shortcoming,” the court found.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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