The use of an inter partes review (IPR) proceeding proved to be a useful tool for a generic drug manufacturer, which settled an IPR with the Patent Owner without the need of costly litigation.  See Ranbaxy Laboratories, Ltd v. Vertex Pharms., Inc. IPR2013-0024.  Ranbaxy, an Indian-based company which develops and markets generic drugs, challenged the validity of Vertex’s U.S. Patent No. 6,436,989 for Lexiva®, an HIV protease inhibitor.  Vertex had previously asserted the ‘989 Patent against Mylan Inc., in the district of Delaware on August 22, 2012 (12-1065-RGA (D. Del)), but Ranbaxy was not a party to the litigation.  Rather, a few months after the litigation had started, Ranbaxy filed a petition at the USPTO challenging all of the ‘989 patent claims as obvious over several prior art combinations.  IPR2013-00024 (Paper No. 1).

The Board instituted the proceeding on March 5, 2013.  (Paper No. 16).  In finding “a reasonable likelihood that the petitioner would prevail with respect to at least” one claim, the Administrative Patent Judge undertook a “lead compound” analysis and determined that prior art provided an express reason for a skilled artisan to modify the lead compound to enhance its solubility, and therefore its bioavailability, by “forming a phosphate ester salt … by derivitizing a free hydroxyl positioned similarly to that of the free hydroxyl of [the lead compound],” with a reasonable expectation of success. (IPR2013-00024 at pp. 7-14).

On October 31, 2013, the parties jointly filed a motion to terminate the IPR, informing the Board that the parties have reached an agreement resolving the dispute and any potential Hatch-Waxman litigation on the patent between these parties.  See Paper No. 69, pg. 1, emphasis added.  Thus, only a few months after the proceeding was instituted, the parties were  able to resolve the IPR, including any future potential litigation.  Interestingly, Mylan, who was sued only two months before Ranbxy’s petition was filed, did not elect to participate in any IPR proceeding involving the ‘989 Patent.  Moreover, the Delaware Court denied Vertex’s motion to stay the litigation against Mylan pending the competition of the IPR with Ranbaxy.  Vii Healthcare Co. et al.  v. Mylan, Inc., Civ. No., 12-1065-RGA, (D. I. 59).  Thus, Mylan’s litigation regarding the validity of the ‘989 patent will continue in the district court under the evidentiary burdens required of proving invalidity under the federal rules,whereas Ranbaxy’s preemptive petition effectively resolved its dispute with Vertex without resort to litigation.  It remains to be seen whether ANDA applicants will continue to use IPR as a strategy for resolving any patent disputes that would have arisen based on the identification of patents in the Orange Book and any potential challenges to them.