Drugs

Induced Infringement Decision Analyzed

Eight Mintz attorneys say a recent unanimous Supreme Court decision makes clear that “skinny label” generic drug manufacturers do not induce patent infringement by simply complying with industry practice and equating the generic drug to the reference drug. In Hikma Pharmaceuticals USA v. Amarin Pharma, the court held that Amarin, the sponsor of the reference drug Vascepa (icosapent ethyl), failed to state a claim for active inducement of patent infringement.

The attorneys review the history of the closely-watched case in which a federal district court granted Hikma’s motion to dismiss for failure to state a claim. That dismissal was reversed by the U.S. Court of Appeals for the Federal Circuit, which found it plausible that doctors could read Hikma statements as instructions or encouragement to infringe. The Supreme Court agreed to hear the case to decide whether Hikma’s statements, taken together, satisfy federal requirements for stating a claim.

The SCOTUS decision says that induced infringement requires “purposeful, culpable expression and conduct,” affirmative actions designed to bring about patent infringement, and not merely passive conduct that might lead to it. It expressly rejected what it described as the recent trend in Federal Circuit case law that focused on whether statements could be read by medical providers as instructions to infringe, the attorneys say.

The court then undertook a three-prong analysis:

compliance with law and industry practice;
omissions are not active steps; and
vague statements plus speculation.

The analysis lists these three key takeaways:

“plausibility” requires stronger facts;
active inducement requires intentional encouragement;
active inducement requires affirmative statements; omissions will not do;
the “totality” theory of induced infringement has limits; and
the door is not completely shut because the court left open the possibility that a generic drug manufacturer could cross the line into inducement liability through implicit but “clear” and “affirmative” encouragement.

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