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Congressman Synar was finally able to pry that data loose from PMA in the latter part of 1983. It revealed that the arguments for shrinking patent life were based on the first patent to issue which covered a new chemical entity that had never before been used as a drug. When full consideration was given to the existence of other (later) patents and to the regulatory delays encountered by generic drug makers in bringing products to the market, the effective commercial monopoly life for the 50 top selling drugs turned out to be 15.5 years and for the 100 top selling drugs it was almost 14 years. Although the Commissioner continues to deny the existence of "evergreening", the data presented to Congressman Synar and analyzed by Congressman Waxman's staff established that there are numerous instances in which more than one patent must expire before there can be any competition. most typical situation involves an early issued product patent followed by a later issued therapeutic use patent claiming the only FDA approved use.

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HR 3605, incorporates the knowledge gleaned from the foregoing data and is therefore more restrictive than earlier versions of patent term extension legislation such as S. 255 and H.R. 6444. More specifically, the bill is based on the simple principle that only the earliest issued patent which either claims or fully discloses an approved drug product can be extended one time. That extension is for a maximum period of five years or for 14 years following the drug approval date whichever is shorter. These rules do not, prevent the research-intensive drug companies from continuing to apply for large numbers of related patents or to control the filing or issue dates of those patents in relation to the commercial development. Rather, they provide a reasonable period of extension for the only problem which the PMA companies have even alleged to exist shortened patent life for the first patent covering a new chemical entity while discouraging the use of patent extensions to slow down new developments or as a new tool for manipulating the patent system so as to unfairly lengthen patent monopolies. The ultimate test of the fairness of the patent term extension provisions of HR 3605 is the endorsement of the bill by a 2 to 1 majority of PMA members. If PMA did not believe that the bill fairly addresses and solves the problem of shortened patent life it would not have endorsed this compromise. In view of that fact, it simply makes no sense for the Commissioner to attack those provisions as being too arbitrary or restrictive or to argue in favor of a more liberal patent extension policy.

The Commissioner's lack of appreciation for the problem which HR 3605 addresses and equitably solves is highlighted by his testimony with respect to the Bolar decision. GPIA and PMA were able to reach a compromise only because patent owners were assured of a longer commercial

monopoly period and generic drug manufacturers were assured of obtaining the necessary approval to engage in competition immediately after that well-defined monopoly period ended. The parties recognized that it was essential to this compromise that generic companies engage in the necessary steps required to obtain ANDA approval prior to the patent expiration date so that they could commence marketing immediately after the patent expired rather than 2 or 3 years later. The agreement to accomplish that result was reached without controversy because it was consistent with common industry practice extending back over many years and therefore did not infringe on any vested economic interest of drug patent owners. The Commissioner's disregard for the fairness of the compromise is demonstrated by the fact that he is anxious to provide patent owners with relief (in the form of patent extension) for the time which they lose in getting to market because of regulatory delay but is unwilling to give generic companies the same relief from the same problem at the end of the patent monopoly period.

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Finally, it should be noted that throughout the course of the many hearings which have been held on the subject of patent term extension, the Commissioner has not come forward with any data whatsoever which would suggest that the commercial life of patented inventions in any field remotely approaches 17 years; that the commercial life of drug patents is materially shorter than the commercial life of patents in other fields; or that extending patent life in any field for any reason would stimulate investment in research or development. Rather, the Commissioner has consistently supported whatever proposal would lead to longer patents without regard for any demonstrated need for such a change in the patent law or the impact of such a change on the competitive environment or on consumers. an institutional bias is not surprising but it is disappointing that the Patent Office is unable to make a more constructive contribution to this compromise effort.

Such

ABE:11k

Respectfully submitted,

AMSTER, ROTHSTEIN & ENGELBERG

Alfred

B.Engelberg

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holder and is authorized to submit this application for extension of the above-identified patent pursuant to 35 U.S.C. $156. A copy of the patent for which extension is sought is enclosed.

I hereby declare the following with respect to this application:

1.

The patent for which this extension is sought claims a product (method of using a product) which was subject to a regulatory review period under the Food, Drug and Cosmetic Act prior to its commercial marketing. The relevant dates of that regulatory review period are set forth above.

2.

The patent for which this extension is sought has never been extended.

3.

5.

The patent for which this extension is sought does not claim a product (method of using a product) which received permission for commercial marketing under the Food, Drug and Cosmetic Act before the NDA Approval Date set forth above.

The active ingredient(s) in the approved product, including any salt or ester thereof, as a single entity or in combination with another active ingredient has never received permission for commercial marketing under the Food, Drug and Cosmetic Act before the NDA Approval Date set forth above.

The following patents have been identified in the application under Section 505(b) of the Food, Drug and Cosmetic Act far the above-identified approved product as patents for which a claim of patent infringement might reasonably be asserted in the event of the unlicensed manufacture, use or sale of the approved product:

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7.

To the best of my knowledge, the approved product (method of using the product) is not claimed in another patent having an earlier issuance date or which was previously extended.

but it is not identically disclosed or described

The approved product is claimed in U.S. Patent No.
therein. U.S. Patent No.
has never been and will never be held by the patent holder herein and the
patent for which extension is sought has never been and will never be held by the holder of U.S. Patent No.

To the best of my knowledge, the approved product and the use approved for the approved product are not identically disclosed or described in another patent having an earlier issuance date or which was previously extended. An extension of years, [Date] is sought based upon

the following calculation:

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The extension does not exceed five years and will not extend the expiration date of the patent for more than fourteen years from the NDA Approval Date.

I acknowledge the duty to disclose information which is material to the examination of this application in accordance with Title 37, Code of Federal Regulations, $1.56(a).

I hereby declare that all statements made herein of my own knowledge are true and that all statements made on information and belief are believed to be true: and further that these statements were made with the knowledge that willful false staturents and the like so made are punishable by fine or imprisonment, or both, under Section 1001 of Title 18 of the United States Code and that such willful false statements may jeopardize the validity of the application or any patent extension issued thereon.

APPLICANT'S SIGNATURE

POST OFFICE ADDRESS

DATE

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Honorable Robert W. Kastenmeier

Chairman, Subcommittee on Courts, Civil Liberties

and the Administration of Justice

Committee on the Judiciary

House of Representatives

Washington, D.C. 20515

Dear Mr.

Re: H.R. 3605 Drug Price Competition and
Patent Term Restoration Act of 1984

Chairman:

I am patent counsel to the Generic Pharmeceutical Industry Association (GPIA) and am writing this letter to provide the Committee with important new information bearing on the alleged constitutional law issue which the dissident pharmeceutical companies have raised. This new information establishes, that the decision in Roche law and was contrary to industry V. Bolar made completely new Accordingly, Section 202 practices and expectations. possibly upset any reasonable investment-back expectations.

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On December 23, 1975, Hoffman-LaRoche Inc. commenced a Civil Action (Civil Action No. 75-2221) in the United States District Court for the District of New Jersey charging Zenith Laboratories, a generic manufacturer, with infringement of Roche's patent covering valium. In an Answer (copy enclosed) filed by Zenith on March 26, 1976, Zenith asserted that it was not liable for patent infringement Accordingly, because the only activity in which it had engaged was experimental studies for the purpose of seeking F.D.A. approval. Zenith filed a counterclaim seeking a declaratory judgment that experimental use did not constitute patent infringement.

In early June 1976, Roche sought to have Zenith's counterclaim dismissed on the ground that there was no case or controversy. In support of that motion, Roche made the following statement:

"It has been clear from the outset of this
case that Roche does not seek to interfere with
in seeking
Zenith's legitimate activities
F.D.A. approval of a New Drug Application (NDA)

for diazepam. Nor has Roche done anything to
interfere with Zenith's bidding for U.S. Gov-
ernment contracts. Roche's brief in opposition
to Zenith's Rule 12 motion expressly states:

"Roche does not seek to enjoin Zenith from
doing the experimental work necessary for it to
secure F.D.A. approval or from bidding for U.S.
Government contracts.""

On June 14, 1976, a hearing was held on Roche's motion before the Honorable Frederick B. Lacey. At that hearing, Roche's attorney stated:

"We have indicated

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we've taken the position

that attempts to secure NDAS in the proper
manner do not constitute patent infringement.

"1

On August 2, 1979, Zenith and Roche entered into an Agreement which led to a Consent Judgment in the foregoing Civil Action. A copy of that Consent Judgment is enclosed. The Consent Judgment clearly states that Zenith was engaged in FDA related experimental activities and wished to continue with such activities. Paragraph 9 of the Consent Judgment permitted Zenith to retain 5 kilograms of diazepam so that it could engage in such experimentation.

It is respectfully submitted that the foregoing facts establish beyond question that until the recent decision in Roche v. Bolar, no one in the industry believed that F.D.A. experimental activity constituted patent infringement. Certainly, there is no other reasonable explanation for Roche's statements with regard to experimental activity involving the most important drug in Roche's recent history.

The foregoing facts cast serious doubt on the testimony of both Professor Dorsen and Commissioner Mossinghoff in stating that the decision in Roche v. Bolar was a mere reaffirmation of a 200 year old principle of patent law. In actual fact, the decision is a total departure from past industry practice. Accordingly, the enactment of Section 202 will clearly not upset any reasonable investment-backed expectations and is not unconstitutional.

Respectfully submitted,

AMSTER ROTHSTEIN & ENGELBERG

ABE/jm
Encs.

Alfred B. Engelberg

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