Intellectual Property – Patent Term Extension – Hatch-Waxman Act – ‘Business Hours’ Interpretation

An Alexandria U.S. District Court vacates the U.S. Patent & Trademark Office’s denial of plaintiff The Medicines Company’s application for a patent extension term under the Hatch-Waxman Act, which allows for extension of the term of a pharmaceutical patent under exclusive license, and remands for reconsideration of plaintiff’s application.

Plaintiff is a pharmaceutical company that specializes in developing acute care medicines that larger drug companies have chosen not to pursue. This case involves an anticoagulant called Angiomax. This drug works by directly inhibiting a key contributor to the formation of blood clots.

For years, in applying 35 U.S.C. § 156(d)(1)’s 60-day deadline, the PTO followed the general rule of starting the count on the first day after the triggering event. In a 2007 decision, however, the PTO concluded that it had been misreading § 156(d)(1). It then changed course and announced it would count the date of FDA approval as one of the 60 days included in the time period for filing a PTE application. Applying this new interpretation, the PTO or the FDA has taken the position that at least seven applications for patent term extensions were untimely, even though they would have been timely under the PTO’s prior interpretation of § 156(d)(1). Moreover, as this case demonstrates, the PTO takes the view that the date of FDA approval counts as the first day of the 60-day period even where the application is not approved until after the close of business – i.e., as late as 11:59 p.m. – and the PTO’s interpretation can thus mean that an applicant is afforded only 59 days rather than 60 days.

In this case, the PTO and the FDA interpreted the word date to have two different meanings in the very same provision, and the PTO offered no explanation for that inconsistency. The PTO also misperceived the scope of its authority. The PTO believed it was precluded from adopting a business hours interpretation of the word date in § 156(d)(1). But neither the statutory text nor any other authority forecloses that reading. While the PTO believed the term date can only be construed to mean calendar day, the statute cannot be so inflexible because the FDA interprets the same word in the same section to mean business day.

The PTO incorrectly thought a business hours interpretation was foreclosed and did not consider central arguments MDCO advanced, and gave no reason to rejecting them. The PTO erroneously believed it was compelled to follow the FDA’s interpretation of the provision of § 156(g)(1)(B)(ii) marking the end of the regulatory review period. The agency also incorrectly believed that a business hours interpretation of § 156(d)(1) was foreclosed by the plain text of the statute, Federal Circuit precedent and its own regulations. Because it believed its hands were tied, the PTO never even considered whether it should exercise its discretion to adopt a “business hours” rule. The PTO must have believed it had no option but to construe the statute as it did: had the PTO recognized any statutory ambiguity, it should have addressed in its decision the issues raised by MDCO.

The PTO’s decision was also flawed because the Office erroneously concluded that a next business day rule would be contrary to regulations.

The PTO’s denial of MDCO’s patent term extension application is vacated and this case is remanded to the PTO for reconsideration as to the date of approval under § 156 and to take such actions as necessary to ensure the ‘404 patent does not expire pending further resolution of these proceedings.

The Medicines Co. v. Kappos (Hilton, J.) No. 11:10cv81, March 16, 2010; USDC at Alexandria, Va. VLW 010-3-124, 18 pp.