Letter from AmeriKat: Hospira's Angiomax win, Apple jury award vacated & Obama's Pacific trade deal

The AmeriKat is no stranger to hissing
when she thinks change is needed...or if she is hungry

Harmony is overrated.   Passivity for the sake of a peaceful life can leave bad behavior unchallenged. Agreement for the sake of agreement can result in missed opportunities.   We all need a degree of discord and disruption to light the path for innovation and, perhaps, a chance of real harmony and internal peace.  Some of the world's most creative and innovative people are said to be creative because, not despite, internal discord and struggle (see Beethoven, Munch, Georgia O'Keefe, Irving Berlin, Virginia Woolf and Vincent van Gough).  Art and music are all about specific types of distortion that change a sound or image in order to stimulate our emotions.  In the words of VS Ramachadran, distortion is designed to "optimally titillate these 30 visual areas of the brain and excite visual emotions."  Disruptive technologies are similar.  They distort how we consume and interact with technology and pave the way for new creation. This disruption often results in IP litigation in the hope that clarity in the law is achieved.  And what could be more harmonious than legal clarity?

Angiomax patents' life span cut short by CAFC:  As the Medicines Company found out a few days ago, sometimes legal certainty can be a bad thing.  The Court of Appeals for the Federal Circuit (CAFC) held that Hospira's generic version of The Medicines Company's anticlotting drug bivalirudin, sold under the brand name Angiomax, was not infringing.  Angiomax accounts for almost 83% of its total revenues in the US in 2014.  The CAFC overturned the district court's earlier decision holding that The Medicine Company's patents protecting Angiomax were valid, but not infringed by Hospira's abbreviated new drug applications.  The CAFC held that both patents subject to the dispute - US Patent No 7,582,727 and 7,598,343 - were invalid.  The patents were due to expire in July 2028. In the lead up to the decision, Angiomax's revenues declined due, commentators suggested, to the legal uncertainty regarding its patent exclusivity.  With the latest decision from the CAFC, sales were expected to further decline but following the decision, The Medicines Company's share price actually increased.  This increase has stumped some analysts but others point to the company's recent FDA approvals including its approval for an authorized generic launch of Angiomax (in collaboration with Sandoz) (see link here).

The jury award that took a bite out
of Apple gets vacated by Judge Gilstrap

Jury award vacated in Smartflash v Apple litigation:   Challenging a bad  jury verdict resulted in a happier Apple last week.  On Wednesday, US District Judge Rodney Gilstrap ordered that the jury's February damages verdict of $532.9 million in Smartflash's patent infringement suit against Apple be vacated.  Smartflash, who depending who you talk to is either a patent assertion entity with no employees or the product of savvy inventor Patrick Racz, commenced patent infringement proceedings against Apple in respect of three of its patents - 7,334,720, 8,118,221 and 8,336,772.  Apple was found to have infringed the patents, all which relate to downloading digital content.  Following the jury verdict, Apple renewed a motion for Judgment as a Matter of Law on the issue of damages on the basis that the entire market value rule of patent damages (subject to the jury instruction) was not not applied by Smartflash in its model.  The confusion created by the instruction persuaded the court "in the clarity of post-trial hindsight" that such an instruction "may have created a skewed damages horizon for the jury."  The court has ordered that jury selection for a new trial concerning the issue of damages be set for September 2015.  Obviously buoyed by its success following February's jury verdict, Smartflash commenced a second patent action relating to Apple's iPhone 6, 6 Plus and iPad Air 2.

The calm Pacific waters
of the Trans-Pacific Partnership deal

Boost for patent proprietors in Trans-Pacific Partnership deal:  The Obama administration is hard at work negotiating a trade deal with 12 Pacific Rim nations as part of an economic policy to respond to China's growing economic influence.  The deal would bind US, Canada, Mexico, Japan, Australia, New Zealand, Chile, Malaysia, Peru, Singapore, Vietnam and Brunei, which together account for 40% of global GDP.  Importantly, the deal would pave the road for the US to guide economic policy in these countries.  In a radio address to the nation a couple of weeks ago, President Obama stated that if the US does not do it "countries like China will write those rules in a way that benefits their workers".  What does this have to do with IP?  The Obama administration is bound by congressional imposed instructions to import as much current US law as possible into the trade accords.  In a leaked draft of the agreement, robust protection is sought for patented drugs with 12 years of data exclusivity and patent linkage systems which would make it more difficult for generic challenges.  The draft also emphasizes protection for biologic drugs.  However, these protections have met with resistance from Australia, New Zealand and Canada.  According to Bloomberg, Chile's foreign minister has said that his country will not accept these provisions.  Richard Gold of McGill University has commented that "some IP is good, but that the brand name pharmaceutical demands, as represented in the leaked TPP draft, go far, far beyond this. What the evidence strongly suggests is that the level of IP proposed will not only hinder access to medicines but actually slow down the ability of these countries to innovate both in the pharmaceutical industry and more generally." But, most commentators are quick to point out that the ultimate agreement is likely to be far different from the leaked draft.  Only time will tell.  To read the latest about these ongoing negotiations, see these articles in Bloomberg, Politico and Fortune.