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BURROUGHS WELLCOME DENIED SUMMARY JUDGMENT IN AZT PATENT INFRINGEMENT COMPLAINT v. BARR, NOVOPHARM; JUSTICE DEPT. BRIEF TO SUPPORT NIH IS SOUGHT

Executive Summary

Burroughs Wellcome's request for summary judgment in its AZT patent infringement complaint against Barr Labs and the Canadian generic drug firm Novopharm was denied June 4 by New Bern, N.C. federal court Judge Malcolm Howard. "The court finds that genuine issues of material fact exist on the issue of inventorship which preclude the entry of summary judgment on the '232 and '130 patents," Judge Howard's order states. Noting that the case was "close on the issue of summary judgment," Howard said that "courts must exercise caution in the realm of summary judgment proceedings and may deny summary judgment 'in a case where there is reason to believe that the better course would be to proceed to a full trial.'" He concluded: "In the light of the complexity of the issues and the national and global impact of this case, the court finds that this case fits into that category." Barr and Novopharm filed ANDAs for generic AZT in March 1991 and June 1992, respectively, challenging Burroughs' Retrovir (zidovudine) patent on the grounds that National Institutes of Health scientists Samuel Broder and Hiroaki Mitsuya were co- inventors of the antiviral agent. Burroughs Wellcome countered with a patent infringement suit in May 1991. Judge Howard also denied a motion by Burroughs Wellcome for partial summary judgment that the company did not act inequitably with regard to its patent filing in failing to name inventors with deceptive intent. Novopharm has argued that Burroughs intended to deceive the U.S. Patent & Trademark Office by not naming Broder and Mitsuya as inventors. Judge Howard said he will decide the issue of inequitable conduct and deceptive intent "based upon [his] own factual findings and observations during the trial." Howard's ruling clears the way for the case to go to a jury trial on June 28 in New Bern, which lies on the eastern seaboard of North Carolina. The trial is expected to draw testimony from as many as 260 witnesses. Howard heard oral arguments on the motion for summary judgment May 28. In its May 3 filing, Burroughs argued that company scientists were the sole inventors of the use of AZT as an AIDS drug. Burroughs argued that its "inventors had fully conceived the inventions" contained within U.S. patents 4,724,232 ('232) and 4,833,130 ('130) and prepared draft patent applications "before Burroughs sent NIH employees a sample of AZT, under code as 'Compound S,' for screening." Barr and Novopharm contend that the two NIH scientists, Broder and Mitsuya, co-invented the use of AZT to treat AIDS and that the Burroughs patents therefore are defective. Burroughs argued that "it is undisputed that the [company] scientists, not Dr. Broder or Dr. Mitsuya, first thought of using AZT as a treatment for people with HIV infection." Judge Howard writes in his opinion that "although the court finds that the evidence strongly favors [Burroughs Wellcome] on this issue, the court believes that whether Dr. Broder and Dr. Mitsuya were merely 'a pair of hands' performing tests at the direction of [the company's] inventors, or whether they collaborated with [the firm's] inventors in conceiving of the idea that AZT would be an effective therapy for AIDS is a question of fact for the jury to determine." Howard comments that Burroughs Wellcome "has presented compelling evidence" that the company inventors' conception of the '232 and '130 was "complete and operative" without any contribution from Broder and Mitsuya. He cites a Feb. 6, 1985 draft patent application drawn up by the company that discloses dosage ranges for AZT that encompassed the recommended dosage approved by FDA for the treatment of AIDS in 1987. The decision states that "notwithstanding this compelling evidence, the court is hesitant to grant summary judgment on an issue which ultimately rests upon the determination of an individual's state of mind." Evidence that casts some doubt on Burroughs Wellcome's contention that conception was complete, the judge noted, is the fact that the company did not file the patent application until March 1985, "after test results were obtained from Dr. Broder." In its motion for summary judgment, Burroughs argued that its scientists by June 1984 had developed murine retroviruses for testing potential AIDS treatments. Over the next five months, the company said, it "tested approximately 100 compounds for retrovirus-inhibiting activity," most of which were "nucleoside analogs." On Oct. 29, 1984, Burroughs said, its antiviral group discussed "possible compounds that might work against" HIV, and chemist Janet Rideout made personal notes and "listed several compounds which she intended to submit for testing in [the company's] murine retrovirus screens," including compound number '509U81,' which was the "in-house name for AZT." On Nov. 16, results were obtained which "indicated that AZT completely inhibited replication of [Friend leukemia virus] at all concentrations." In December 1984, the motion states, Burroughs notified FDA "that it would soon be seeking approval to commence clinical trials on a new AIDS drug." Such notification provides "clear evidence that [company] inventors had conceived of the use of AZT as an anti-HIV therapy," Burroughs argued. The evidence "led NIH's own lawyers to conclude at least three times that they had no case." On Feb. 6, 1985, Burroughs patent attorney Michael Garrett drafted a patent application. Burroughs sent "Compound S" to NIH for screening on Feb. 4, 1985. "Dr. Broder did not know that Compound S was AZT," the motion states. On March 1 Burroughs Wellcome VP Research, Development and Medical David Barry "told Dr. Broder that Compound S was AZT." The motion also cites depositions taken from Broder and Mitsuya, who, Burroughs said, have acknowledged that company scientists "had the specific idea to use AZT to treat HIV infection before" NIH tested Compound S. In its May 17 memorandum in opposition to the motion for summary judgment, Barr contended that one is not an inventor under the law "simply by having an idea." Barr asserts that Burroughs "admits" that testing against mouse viruses "was not predictive of AZT's effect against HIV." Yet, Burroughs motion is structured on the theory "that the putative inventor need not have any basis whatsoever for believing that the idea will work in the intended manner," Barr said. "That is simply not the law." In the period 1984-1985, Barr asserted, "nobody had any basis to believe that a drug would be effective until it was actually used in a test with live HIV. The individuals who actually discovered that AZT is effective against HIV, and therefore AIDS, made a contribution to the invention of AZT as a method of treating AIDS in humans," the generic drug maker's motion maintains. Because of the difficulty of obtaining live HIV virus for testing in 1984, Duke University scientists recommended that Burroughs screen potential candidates for testing against HIV through the use of a non-HIV screen, and the parties "decided on a mouse virus screen," Barr said. "The major problem was that nobody knew all the similarities and differences" between HIV and murine viruses, and "therefore the screen could not predict how drugs would work against HIV." Broder visited Burroughs in October 1985 and discussed with Barry the possibility of collaborating on the search for a drug for AIDS. Broder "offered to test compounds against live HIV in his laboratory. He offered to invite [Burroughs] scientists to his laboratory to learn his methods for working with live HIV, and he offered to send [the company] his technology," Barr maintained. However, the company "did not want to work with live HIV," Barr said. Broder was told that Barry had a "very moving and life- altering" experience, "when a technician he had known died while working with a lethal virus." They agreed on a collaboration in which the company would provide NIH "with drug which Broder would study." Burroughs initially sent five other compounds to NIH for testing, Barr said. Burroughs first sent AZT for outside testing to Duke and FDA, which "did not immediately discover positive results." Duke reported a positive result on March 18, 1985, "after Broder and Mitsuya had made their discovery." FDA did not achieve a positive result for AZT. NIH received Compound S on Feb. 4, 1985 and reported positive results to Burroughs on Feb. 20, Barr said. Burroughs "recognized that it had a possible treatment for AIDS only after Broder and Mitsuya's results arrived," Barr said. The opposition memo cites a 1985 Burroughs chronology that states that after receiving the NIH results, the company decided "to move ahead and develop [AZT] as an antiviral." Burroughs' Feb. 6 draft patent application "was not actually even recommended for filing by Garrett until March 5, 1985, after Broder and Mitsuya's testing," the opposition memo states. Two reasons that led to the recommendation for filing of the patent application on March 5 were AZT's activity against a mouse retrovirus and its efficacy against HIV. "If the first reason alone had been sufficient," Barr argued, "the application could have been filed as far back as November or December 1984." NIH entered the AZT patent fray in 1991 when it granted a nonexclusive license to Barr to develop a generic AZT. The institutes' action reflected its belief that NIH is a co-inventor of the antiviral agent. NIH Director Bernadine Healy, MD, said her agency granted the license to Barr on the grounds that its scientists "made vital contributions to the discovery of AZT's activity in humans against the AIDS virus." A number of key members of Congress have agreed with NIH, including Democratic Sens. Metzenbaum (Ohio) and Pryor (Ark.). In a May 18 letter to Barr President Bruce Downey, Pryor said: "The federal government had a very active role in the discovery and development of AZT," and the Justice Department should "seriously consider supporting our efforts." Attorney General Janet Reno has indicated that she will investigate the matter and reconsider whether Justice should be a party to the litigation. House Energy & Commerce/Health Subcommittee Chairman Waxman (D-Calif.) and House Small Business/Regulation Subcommittee Chairman Wyden (D-Ore.) sent a joint March 23 letter to the Justice Department, asking Attorney General Reno to direct her department to intervene in the litigation on behalf of NIH.

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