Three milestones to watch for in 2019 that could impact generic entry for Celgene’s Revlimid.
Since announcing the pending acquisition of Celgene ($CELG) by Bristol Myers ($BMY), investors have focused upon the patent-cases involving Revlimid®. There are multiple cases and petitions for inter partes review (IPRs) at various stages of resolution. The key question among investors is whether there will be any key milestones in those cases--especially during 2019 before the Bristol acquisition closes—that will clarify exactly when any of the pending generics will enter. In this post, we identify three potential milestones to watch for from the Revlimid® patent landscape in 2019.
Dr. Reddy’s Polymorph Case
The most important case to focus on is Celgene’s first Hatch-Waxman lawsuit against Dr. Reddy’s, filed in 2016. (There are at least two other lawsuits related to Revlimid® also pending against Dr. Reddy’s.) The first case, however, asserts two polymorph patents. Those patents do not expire until 2024 and 2027, respectively. Any resolution on either of these two patents in 2019 would be very material.
For instance, if Celgene were to prevail at trial on the 2027 polymorph patent alone, that would substantially increase the likelihood that Dr. Reddy’s would not enter for another eight years, and not until after Natco’s entry. This would be true even Celgene lost on all the other asserted patents, including the method of use and REMS patents, since those patents expire much earlier.
Alternatively, if Dr. Reddy’s prevails on the two polymorph patents, either by showing it does not infringe them or that they are invalid, that would almost guarantee an entry by Dr. Reddy’s in 2023, at the latest. That’s because all the other asserted patents pending against the generics expire by 2023.
Thus, the critical question is, when is the trial? Expert discovery is likely to conclude by the end of February, and the trial is likely to be scheduled sometime in 2019. (Indeed, a recent discovery dispute suggests that expert discovery may not end until March.) Whether or not the Court permits summary judgment motions will impact the timing of the trial. Paying attention to the Court’s docket to determine scheduling will therefore be critical to assessing how likely it will be to have a resolution of the polymorph patents this year.
Either way, the trial will be a bench trial, rather than a jury trial. That means, after it happens, the Court will have to draft and issue an opinion. Those opinions typically take a matter of months. Thus, even if the trial itself happens in the latter half of 2019, which is not wholly unlikely, the decision itself is unlikely to issue before Q4 2019, at the earliest.
The IPRs have attracted considerable focus from investors since they will yield tangible data points within the next few months. Dr. Reddy’s has filed three IPRs against three MDS patents, and Lotus has filed a single IPR against one of the multiple myeloma patents. The PTAB is scheduled to issue institution decisions for each of the IPRs on dates between the middle of February and the middle of March.
Unlike resolution of the polymorph patents, the outcome of the IPRs is not necessarily dispositive. For instance, if Dr. Reddy’s were to be denied institution of all three of its IPRs, that would not be terminal. It could still challenge the patents in the pending district court cases, or regardless of that, simply carve out the MDS indication from its generic label.
That said, the upcoming IPR institution decisions could be nevertheless be a material data-point for 2019. All four IPRs cover method of use patents. While they include dosage regimes, and do not simply require taking lenalidomide for treatment of MDS or multiple myeloma, the odds are greater than not that the generics will infringe at least one of the asserted patents for each indication. That is why invalidating them is so important if any generic wishes to enter before 2023, when the last of them expire.
This is where the IPRs may provide read-through. If the IPRs filed by Dr. Reddy’s and Lotus are all denied institution, that data-point could suggest that the MDS and multiple myeloma patents are probably not invalid. And if the generics have a lower likelihood of designing around these patents, that could suggest no generics will enter until the method-of-use patents expire, which is 2023.
The Bifurcation Issue
The litigation against Dr. Reddy’s has attracted considerable focus, but there are several other litigations pending against ANDA-filers for Revlimid®. In addition to Dr. Reddy’s, there is Cipla, Lotus and Zydus that all have pending ANDAs, which has triggered Hatch-Waxman lawsuits filed by Celgene. The landscape is complicated by the fact that Celgene has multiple suits pending against each generic, which assert different categories of patents. (For instance, there are technically three separate Revlimid® patent cases pending against Dr. Reddy’s.)
The good thing is that all these other cases—except for the initial case against Dr. Reddy’s, which asserts the polymorph patents, discussed above—are currently on the same schedule. And that schedule previously provided that a claim construction hearing—otherwise known as a Markman hearing—was likely to happen sometime in April or May, with a decision soon thereafter.
However, before the parties filed their Markman briefs, they filed sealed letters with the Court indicating a dispute over bifurcating an issue in the cases. In light of this issue, the Court has indefinitely stayed any further Markman briefing. Further, in the interim, on January 30, Celgene revoked a covenant-not-to-sue of the ‘217 patent. And the parties in the Cipla action indicated a Markman hearing was no longer necessary.
The ‘217 patent is one of the polymorph patents. The previously-filed covenant-not-to-sue indicated that it will remain in effect as long as Lotus does not change the “solid state(s) or “crystalline form(s)” of its ANDA formulation. By revoking the covenant-not-to-sue suggests that Lotus may have altered its ANDA.
What exactly is the “bifurcation issue”? Without the benefit of the letters filed by the parties—which are sealed from the public—we cannot say for sure. What we do know is that it relates to the pending claim construction briefing, and likely to the polymorph patents. The parties appear to be jockeying over the applicability of the polymorph patents to the pending ANDAs.
Exactly how this issue eventually resolves may provide read-through into how likely it is that Celgene can show infringement of the polymorph patents. This issue, therefore, is equally important for investors to watch for the Bristol trade.