In Proveris Scientific Corporation v. InnovaSystems, Inc., the defendant sought to invoke the so called "Safe Harbor" provisions of 35 U.S.C §271(e) in order to avoid liability for patent infringement. The patent at issue covered a system and apparatus that allowed those seeking FDA approval to provide necessary data demonstrating the efficiency and effectiveness of drug delivery for drugs delivered in an aerosol spray via a nasal pump or inhaler. Defendant manufactured and sold a testing/calibration device that provided essentially the same information by using technology similar to that enunciated in the patent. Defendant claimed that §271(e), which exempts the use of a patented invention solely for uses reasonably related to the development and submission of information to the FDA, sheltered its actions.
The defendant never found a port in the storm for its position. The district court granted JMOL in the patent holder's favor and the Federal Circuit affirmed on appeal.
What sunk the defendant? The fact that neither its device nor the patent holder's was subject to FDA approval-both merely facilitated the process for others. The Federal Circuit noted the almost "perfect" symmetry between the two distortions to patent term that §271(e) was enacted to eliminate. The first occurs when a patent holder's term is unfairly shortened because of the need to obtain FDA approval prior to commercialization. The second happens when the term is unfairly extended at its end by a patent holder preventing competitors from beginning the approval process until after the expiration of the patent.
The Federal Circuit found that research, testing or manufacturing equipment or products ancillary to the FDA's approval process are simply not subject to the distortion of patent terms contemplated by §271(e). Because it did not need FDA approval for its equipment, the patent holder here faced no limitations to use at the start of the patent term. Similarly, no FDA action will hinder the defendant from moving forward when the patent holder's term expires. This similar symmetry meant the defendant could not claim the succor of the Safe Harbor provision.
All litigants in these industries on deck! Even if activity is "reasonably related" to the submission of data to the FDA, a party still faces exposure if a meaningful distinction can be drawn between the "thing" that is being submitted for approval and the materials, systems or equipment used to assist in that process. Participants in these industries would be well served by reviewing the standards and language under the Federal Food Drug and Cosmetic Act to determine whether their inventions -- depending on how claimed -- would be subject to FDA approval.
Note also that its handling of expert testimony is ultimately what capsized defendant's case. Defendant never submitted a formal Rule 26 report for one of its proffered witnesses because it claimed the patent was so simple enough that it did not require expert testimony. Its other proposed expert lacked experience in the relevant area and the district court excluded the testimony of both. Without any contradictory expert testimony regarding the patents validity, the Federal Circuit had no choice but to affirm the JMOL granted to the patent holder.
Clearly, the defendant did not give serious consideration to the role of expert testimony in a patent case, to its ultimate detriment. While litigants are always trying to "simplify" matters for jurors, this case serves as a reminder that properly prepared and qualified experts remain a key part of any patent trial.
The lesson? Chart a course which fails to heed to the current direction of expert winds and risk watching your patent litigation action run aground just like the defendant in Proveris.
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