This week, we take a closer look at two precedential cases concerning pharmaceutical patent protections as applied to drugs in development.

In Incyte Corp. v. Sun Pharm., Judge Hughes entered a dissent pushing back on the Court’s trend of dismissing appeals from post-grant PTAB proceedings for lack of standing, arguing that pharmaceutical patent challengers should not have to make major investments in development before being able to appeal an unsuccessful patent challenge.  In Jazz Pharms. v. Avadel CNS Pharms., the Federal Circuit cut down a permanent injunction for impermissibly encroaching on the safe-harbor development provisions of 35 U.S.C. § 271(e)(3), and raised—but did not answer—a new question concerning whether submitting a new drug application could infringe under § 271(e)(2) if the patent at issue is not listed in FDA’s “Orange Book” publication.

Incyte Corporation v. Sun Pharmaceutical Industries, Inc., Appeal No. 2023-1300 (Fed. Cir. May 7, 2025)

In the most recent case to address standing to appeal an adverse decision in a post-grant proceeding at the Patent Office, the Federal Circuit again found no standing to appeal.  As noted in a concurrence by Judge Hughes, this is a trend among cases involving patents for pharmaceuticals.  In his concurrence, Judge Hughes advocates for a change in the Federal Circuit’s jurisprudence.

This case concerns a deuterium modification of ruxolitinib, a compound used to treat autoimmune disorders.  The patent at issue treats hair loss disorders such as alopecia areata.  Sun Pharmaceuticals obtained the ‘659 patent, which covers a method for treating a hair loss disorder using a particular dosage of the pharmaceutical.  Incyte filed a petition for post grant review of the patent.  The Patent Trial and Appeal Board found in favor of Sun, and held that Incyte failed to prove the patent was unpatentable.

Incyte appealed, and Sun challenged that the Court did not have Article III jurisdiction over the appeal because there was not a sufficient “case or controversy.”  Sun’s position was based on the assertion that Incyte would not suffer an injury in fact from the adverse finding in the post grant review.

The Federal Circuit agreed.  Citing the lineage of cases it has developed concerning Article III standing to review adverse decisions in Patent Office proceedings, the Federal Circuit found that Incyte had failed to establish an injury in fact.  Incyte had argued its injury stems from potential infringement liability stemming from its development of a topical deuterated ruxolitinib product for treating alopecia areata, and submitted evidence that it was in the process of developing such a product.  But the Federal Circuit found its plans were “too speculative” to be seen as “concrete plans for future activity.”   The declarations it submitted in support showed its plans amounted to only “an expression of intent to create a product that runs a substantial risk of infringement if it is able to clear all development hurdles, secure FDA-approval, and bring its claims to market.”  Because these were not sufficiently “concrete,” the Federal Circuit found it did not have standing to hear the appeal.

Judge Hughes concurred because he believed the panel’s decision was consistent with Federal Circuit precedent.  However, he expressed concerns about the precedent as relates to pharmaceutical products.  Judge Hughes noted that the Federal Circuit has found it lacked standing disproportionately in cases involving pharmaceutical products.  He noted that “[a] party seeking to develop a drug that may infringe an existing patent has a significant interest in trying to invalidate that patent before making the large financial and time investments such development efforts demand.  Requiring these investments to be made before finding standing . . . is inefficient and contradicts the spirit of Article III standing as setting a minimum threshold to ensure the party initiating suit has a real personal stake in the outcome.”  Absent the existing caselaw, he would have concluded that Incyte had standing to appeal.

The opinion can be found here.

By Nika Aldrich

Jazz Pharmaceuticals, Inc. v. Avadel CNS Pharmaceuticals, LLC, Appeal Nos. 2024-2274, -2277, -2278 (Fed. Cir. May 6, 2025)

In a case concerning infringement by a planned sleep disorder drug, the Federal Circuit addressed questions concerning the proper scope of permanent injunctive relief as pertains to drugs in development under the Hatch-Waxman Act.  It was found that Avadel’s “Lumryz” medication would infringe a patent owned but not practiced by Jazz Pharmaceuticals, and the district court had entered an injunction prohibiting Avadel from commencing new clinical studies of the drug; from offering open-label extensions to current study participants; and from applying for FDA approval of Lumryz under a new indication.  The Federal Circuit reversed-in-part, vacated-in-part, and remanded.

The Federal Circuit reversed the injunction as it pertained to new clinical studies and open-label extensions.  The Court found that the injunction encroached upon the safe-harbor provisions of 35 U.S.C. § 271(e)(3), which provides that acts undertaken solely to develop data for regulatory approval are non-infringing.  The Court rejected Jazz’s argument that § 271(e)(3) provides an affirmative defense that Avadel had failed to plead and prove.  The Federal Circuit explained that certain invocations of § 271(e)(3) may require factual development to determine whether a given use is non-infringing, but that as a facial challenge to forward-looking relief against acts that had not yet occurred, the district court’s injunction was overbroad as a matter of law.

However, the Federal Circuit vacated and remanded the injunction as it pertained to the submission of FDA applications for approval of Lumryz under a new indication.  Because Jazz did not itself practice the patent at issue, it was not listed in the Orange Book, and for that reason, the Court noted an open legal question as to whether submitting a new drug application would be an act of infringement under § 271(e)(2).  If submitting an application for a drug covered by any patent infringes under § 271(e)(2), then enjoining new applications exceeded the statutory scope of remedies for such an infringement, and the injunction was unlawful.  However, if § 271(e)(2) infringement is limited to applications for drugs practicing patents listed in the Orange Book, then the district court was required to consider whether enjoining a new application—which would itself be non-infringing—was necessary to prevent actual infringement under § 271(a)-(c).

Because the question was not raised until oral argument on appeal, the Federal Circuit remanded this portion to the district court to determine in the first instance whether § 271(e)(2) applied.

The opinion can be found here.

By Jason A. Wrubleski 

ALSO THIS WEEK

Incyte Corp. v. Sun Pharm. Indus., Ltd., Appeal No. 2025-1162 (Fed. Cir. May 7, 2025)

In a related but distinct case from our Case of the Week, the Court dissolved a preliminary injunction in district court litigation brought by Incyte concerning one of its own patents.  The district court granted the preliminary injunction, finding that Incyte would suffer irreparable harm if Sun were allowed to launch its competing product.  Incyte had argued that Sun would achieve an unfair head start and obtain first mover benefits from getting its product on the market.  But Incyte’s patent expires in 2026, and it is still several years away from launching its own product.  Accordingly, Sun is going to have a head start regardless, even if it waits to launch when the patent expires in 2026.  The Federal Circuit held it was clearly erroneous to hold there would be irreparable injury under such circumstances, and reversed the grant of the preliminary injunction.

The opinion can be found here.

By Nika Aldrich

Ingenico Inc. v. Ioengine, LLC, Appeal No. 2023-1367 (Fed. Cir. May 7, 2025)

In this case, the Court of Appeals affirmed the jury verdict from the district court finding challenged claims of U.S. Patent Nos. 9,059,969 (“the ’969 patent”) and 9,774,703 (“the ’703 patent”)—which relate to secure communications for portable devices—invalid as anticipated and obvious by the prior art. Among other things, the Court of Appeals rejected Appellant IOENGINE’s argument that the district court should have precluded Ingenico from introducing prior art at trial pursuant to IPR estoppel under 35 U.S.C. § 315(e)(2). Section 315(e)(2) prohibits an IPR petitioner from asserting that a claim is invalid “on any ground that the petitioner raised or reasonably could have raised” in the IPR proceedings. The panel explained that a petitioner has no opportunity to raise certain grounds for invalidity at IPR, such as that the claimed invention was known or used by others, on sale, or in public use. See Lynk Labs, Inc. v. Samsung Elecs. Co., 125 F.4th 1120, 1128 (Fed. Cir. 2025).  The Court therefore concluded that IPR estoppel applies only to a petitioner’s assertions in district court that the claimed invention is invalid on grounds available in IPR, i.e. it was patented or described in a printed publication. Thus, IPR estoppel does not preclude invalidity assertions that a claimed invention was known or used by others, on sale, or in public use in district court, nor the use of patents or printed publications as evidence for these assertions.

The opinion can be found here.

By Elizabeth Graves

In re: Miodrag Kostic, Guy Vandevelde, Appeal No. 2023-1437 (Fed. Cir. May 6, 2025)

In an appeal from the Patent Trial and Appeal Board sustaining an Examiner’s rejection of a reissue claim due to improper broadening of the claim, the Court affirmed. On appeal, Appellants argued that the proper inquiry is whether the reissue claim is broader than the “intended scope” rather than the actual scope as written. However, the Court rejected the argument because it “construe[s] the claims as written, not as the patentee wish they had written it.” As such, the Court compared the scope of the reissue claim with the actual scope of the original claim. Here, the scope of the reissue claim was broader because it attempted to make the processes involved optional rather than mandatory (“either/or” rather than “and”). This broadening was improper because it was more than two years after the grant of the original patent, which is a statutory bar pursuant to 35 U.S.C. § 251(d).

The opinion can be found here.

By Jeff Liao

This article summarizes aspects of the law and does not constitute legal advice. For legal advice with regard to your situation, you should contact an attorney.