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PATENT CERTIFICATION COMPROMISE FRAMEWORK COULD BE BUILT ON DECLARATORY JUDGMENT OF PATENT INVALIDITY, TIME-LIMIT PROTECTION FOR GENERIC COMPANIES IN COURT

Executive Summary

The starting point for a resolution to the patent certification issue in the final round of negotiations on the Waxman ANDA bill is a provision that would require a generic marketer to get a declaratory judgment of patent invalidity in court before me-too marketing could begin. The declaratory judgment requirement would protect brandname mfrs. from having to track down potential patent jumpers ex post facto. Generic mfrs. would be protected in the compromise by a limit on the amount of time that they would have to wait for a court decision. The exact length of time will, obviously, be important to the final bill; a reasonable time limit for seeking judgments would be in the two-to-three year range. Compromise based on the concept of declaratory judgment prior to marketing is at the heart of the final negotiations. The first meeting of the final round of negotiations was held Friday, May 11 and lasted late into the afternoon The only deadline for the negotiations is the legislative calendar, foreshortened in this election year. Rep. Kastenmeier's (D-Wisc.) Judiciary/Courts Subcmte., which has jurisdiction over patent legislation in the House, is waiting for all constituents to agree upon the ANDA/patent restoration compromise before calling hearings. The subcmte. -- which had hoped for May 16 hearings -- is now defering hearings on the bill at least until June. Sen. Kennedy Reportedly Lining Up Behind ANDA/Patent Compromise Legislation Negotiators on both sides of the issue continue to keep the talks close to the vest. One of the difficulties, however, in arriving at a final resolution has been presenting compromises to all interested parties ex post facto. Those various constituencies must then ratify ideas without having been a party to the negotiations. PMA devised a board cmte. approach at its annual meeting to prevent problems in this final round. Aside from Rep. Waxman (D-Calif.), the driving force behind the compromise, there is substantial activity on Capitol Hill to pave the way for final legislation. For example, last week Sen. Hatch (R-Utah), whose Labor & Human Resources Cmte. has jurisdiction in the Senate over the ANDA portion of the compromise, signed a letter to the PMA board indicating his support for the bill. Reportedly, Sen. Kennedy (D-Mass.), the ranking Democrat on the Hatch cmte. and an influential member of the Judiciary Cmte., which has Senate jurisdiction over the patent portion of the legislation, signed onto the proposal this week. Kennedy and Sen. Metzenbaum (D-Ohio) were ardent opponents of a patent restoration bill two years ago. The April 25 draft of Waxman's bill required patent holders to obtain a preliminary injunction against a generic firm seeking a market a me-too version of a drug covered by the challenged patent ("The Pink Sheet" April 30, p. 10). PMA companies are arguing that the onus should be on the patent challenger to prove that the brandname drug's patent is no longer valid. In addition to shifting the burden of winning a court decision from the patent holder to the patent challenger, PMA's proposal would require declaratory judgment. Generally it is considerably faster to obtain a preliminary injunction than a declaratory judgment from a federal court.
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