FDA Law SSRN Reading List (September 2017)

Here’s what to read on SSRN, relating to FDA law, from September 2017.  One piece contributes to a growing literature on the relationship between inter partes review and Hatch-Waxman litigation, and one piece dives into application of intended use doctrine to synthetic nicotine products.

Jennifer Sturiale, Hatch-Waxman Patent Litigation and Inter Partes Review: A New Sort of Competition, forthcoming in the Alabama Law Review.  The author is an associate at Quinn Emanuel and also an adjunct professor (antitrust, I think?) at Georgetown.  She is concerned that despite the Supreme Court’s ruling in FTC v. Actavis (relating to reverse payment settlements), drug innovators and generic companies will continue to settle their patent litigation disputes, depriving the public of rulings on patent validity and delaying generic entry on account of patents that might have been found invalid.  She believes that inter partes review (IPR) of patents at PTO can solve this problem — if three additional changes are made.  To begin with, she would have the Patent Trial and Appeals Board (PTAB) proceed to a final written decision in an instituted IPR even if the parties settle any parallel district court litigation.  To me, the more interesting suggestions are her legislative proposals.

First, she would rewrite the 180-day exclusivity scheme.  Currently, the first generic applicant to challenge a patent listed for the reference product (via a paragraph IV certification in its application) is eligible for 180-day exclusivity.  Thanks to an April 1998 decision of the D.C. Circuit (Mova v. Shalala), there is no requirement that the generic applicant be sued or win the resulting patent litigation.  Today, if the applicant does not launch and does not litigate, subsequent applicants are stuck in limbo unless and until a forfeiture provision applies.  A subsequent applicant can trigger a forfeiture clock with a court decision, and I’ve seen articles arguing that they should be able to trigger forfeiture with a PTAB ruling as well.  But Sturiale isn’t focused on the plight of subsequent applicants per se; she is trying to get more rulings on  patent validity.  So she argues that exclusivity should be awarded only to the first generic applicant to secure a determination of patent invalidity or non-infringement, whether in district court or before the PTAB.  (The latter of course would just be a ruling on validity).  She would also make the exclusivity forfeit if the generic applicant did not enter the market within a fixed period of time.  (I would have to think about this more, but I think the language here would have to be a bit more complex than she describes.  A fixed deadline of 75 days past the PTAB decision might not work, if the generic company succeeded with its inter partes review before its generic application was approvable for some reason — for instance, if it was waiting out one patent that it had chosen not to challenge.)

Second, she would change the 30-month stay provisions.  Under current law, if the innovator brings a timely suit following a paragraph IV patent challenge, approval of the generic application is stayed for 30 months.  A district court finding of invalidity or non-infringement will end the 30-month stay, permitting FDA to approve the generic drug.  She would have a PTAB decision of invalidity also end the stay, which she argues would “harmonize” the recent changes to the patent law (enactment of IPR) with the Hatch-Waxman scheme.  (I suppose that truly harmonizing the schemes would entail also imposing a 30-month stay in situations where PTO institutes inter partes review in the first instance, but that could be tricky to draft and is not covered.)

It’s an interesting piece, and others (such as – she notes – Profs. Hemphill and Lemley) have taken an interest in amending the 180-day exclusivity scheme.  If inter partes review survives Supreme Court review this term (Oil States), it would not surprise me to see these recommendations grow legs.  In the interests of full disclosure I commented on an early draft of this article.

Patricia Zettler, Natalie Hemmerich, and Micah Berman, Closing the Regulatory Gap for Synthetic Nicotine, forthcoming in the Boston College Law Review.  The authors are one of this blog’s founders as well as a professor at Ohio State and a postdoctoral fellow at Ohio State’s Center of Excellence in Regulatory Tobacco Science.  Health policy folks will like the robust analysis of FDA’s authority to regulate synthetic nicotine products.  FDA regulatory wonks will enjoy the contribution on FDA’s intended use doctrine.

Synthetic nicotine  — which now appears in e-cigarette liquids, among other things — does not satisfy the FDCA definition of “tobacco product.”  (In addition, it isn’t as dangerous; the authors note that nicotine makes tobacco products addictive, but their other components and properties make them deadly.)  The authors argue that FDA should regulate synthetic nicotine products as drugs, partly so that these products do not escape regulation when (similarly situated) tobacco-based nicotine products are regulated, partly for consumer protection, and partly to encourage research into the effects of these products.  Indeed, as the authors point out, FDA already regulates some nicotine-containing products (smoking cessation products) as drugs.  The authors do not appear to be insisting that FDA require new drug applications (or impose a prescription requirement); they address ways of reducing the burden of drug oversight, including (perhaps) adding synthetic nicotine to the OTC review.

My favorite sections are I-B (a history of FDA’s use of the drug authorities to regulate tobacco and nicotine) and section II (the legal case for regulating synthetic nicotine as a drug).  The jurisdiction question amounts to whether the drug definition applies, which in turn depends on the “intended use” of the products.  The authors conclude that synthetic nicotine companies routinely represent their products as intended to affect the structure or function of the body and argue that the companies also make disease claims (by comparing the risk of their products with the risk of tobacco products, and sometimes with advertising testimonials that mention using the products when “sick”).  They also argue that the design of the products justifies an inference that the products are intended to affect the structure or function of the body, a theory which the authors concede has not yet been expressly confirmed by any court.  (As they note, FDA has itself sometimes cited product design aspects as evidence of intended use.)  The authors also argue that consumer intent is relevant to the question whether synthetic nicotine is a drug, relying on a controversial clause in the agency’s intended use regulation (that the “circumstances surround the distribution” of a product may be evidence of its intended use).  They admit this is their most controversial argument, but have buttressed it by laying out the other two grounds (express claims and product design) for FDA to assert jurisdiction.

For my own part, I would love to see another piece exploring the “what next” question — how these products would be regulated, if the agency did assert drug authorities.  The foreshadowing in section III-D about OTC monographs and other “options” to reduce the burden is very intriguing.

Happy reading!



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