The following are cases in the United States wherein compulsory licensing as a limitation on the remedies for infringement (Trips Article 44 cases) relating to medical technologies.
2012: Conceptus, Inc. v. Hologic, Inc.
Conceptus, inc. filed a patent infringement case against Hologic, Inc. alleging that Hologic’s transcervically introduced permanent contraception system infringed Conceptus’ ‘Essure’ system. The court ruled in favor of Conceptus, but denied an injunction. The court found that “that public interest would be undoubtedly harmed by an injunction.” Conceptus was awarded lost profits and a 20% royalty.
Case Citation:
- Conceptus, Inc. v. Hologic, Inc., No. C 09-02280 WHA, 2012 WL 44064 (N.D. Cal. Jan. 9, 2012)
2012: Boston Scientific Corp. v. Cordis Corporation
In 2009, Boston Scientific Corporation (BSC) filed a patent infringement action against the Cordis Corporation for infringement of its US Patent No. 5,922,021, which is a patent involving cardiovascular stents. The court ruled in favor of BSC in this case, which follow several previous patent infringement claims and counterclaims between the two parties (which also were decided in favor of BSC). The claim in this case was ruled to be a separate instance of infringement from the previous cases (which also involved cardiovascular stents). The jury awarded $18,531, 022 in lost profits damages and $1,000,470 in reasonable royalties to BSC. BSC did not seek a permanent injunction, asserting,
“that a permanent injunction would be appropriate under the facts of this case, it appreciates that courts have been reluctant to issue injunctions in stent cases, and seeks instead an award of an ongoing 32% royalty rate.”
In order to reach the requested 32% royalty rate, BSC’s expert testified that they,
“calculated the effective damages rate that reflects all of Cordis’s infringing sales through March 2011 based on the jury’s total damages verdict, including both reasonable royalty and lost profits damages. This effective damages rate is the equivalent percentage of Cordis’s sales revenues that reflects the jury’s determination of damages to [BSC] (both lost profits and reasonable royalty damages) resulting from Cordis’s infringement of the [‘021] patent with the 2.25 mm Cypher stent. . . Based on Cordis’s total sales of approximately $60.7 million from September 2009 to March 2011, . . . total damages, including reasonable royalty and lost profit damages, correspond to an effective damages rate of 32 percent.”
In Cordis’ counter argument, they stated that since cardiologist have other choices of olimus-eluting stents now, that there was not a “realistic possibility” that future sales of the infringing stent would take sales or profits from BSC, and asserted that even a 2.95% royalty rate would be insufficient for a reasonable profit margin. The court granted BSC’s motion for ongoing damages in lieu of a permanent injunction at a rate of 32%.
Case Citation:
- Boston Scientific Corporation and Boston Scientific Scimed, Inc. v. Cordis Corporation, Civ. No. 10-315-SLR (US District Court, Del., March 13, 2012)
2012: University of Pittsburgh v. Varian Medical Systems, Inc.
In 2012, the US District Court decided that Varian Medical Systems had found to be infringing on two patents owned by the University of Pittsburgh and had been used in Varian’s Real-time Position Management Respiratory Gating System (RPM System). The RPM System is used in imaging and radiation therapy to target tumors during cancer treatment. The court ruled in favor of the University of Pittsburgh, awarding the university more than $36.8 million in damages. Additionally, the judge found that the university was entitled to an ongoing royalty for the infringement, with a rate of 10.5% for the sales of Varian’s RPM Systems and a rate of 1.5% for its sales of the Clinac and Trilogy linear accelerators, which were sold in conjunction with the RPM Systems.
Case Citation:
- University of Pittsburgh of the Commonwealth System of Higher Education d/b/a/ University of Pittsburgh v. Varian Medical Systems, Inc., No. 08-CV-1307 (US District Court, W.D. Pa., April 25, 2012)
2011: Edwards Lifesciences AG v. CoreVALVE, INC.
On February 7, 2011, a federal judge in Delaware rejected a request for an injunction to prevent the continued infringement of United States Patent No. 5411552, for “Valve prosthesis for implantation in the body and a catheter for implanting such valve prosthesis.” The patent in question relates to the CoreValve device, which is used to treat Aortic valve stenosis (AS) , a disease of the heart valves in which the opening of the aortic valve is narrowed.
This case, Edwards Lifesciences v CoreValve, was notable for several reasons.
- The compulsory licensing of the patent involves a medical technology — at a time when the Obama Administration is trying to block mention of compulsory licensing of medical patents at a UN high level meeting on non-communicable diseases.
- At least for now, the compulsory license will be used exclusively for manufacturing and exporting the infringing medical device. This is an example of how a compulsory license issued under Part III of the TRIPS is not bound by the restrictions on exports under a compulsory license granted under Article 31 of the TRIPS (31.f), or even the 30 August 2003 Decision of the WTO to implement Para 6 of the Doha Declaration on TRIPS and Public Health.
- The decision to order the compulsory licensing of the invention was in part to avoid the relocation of the manufacturing from the United States to Mexico. That is, the compulsory licensing of the patent saved U.S. manufacturing jobs that would have otherwise gone to a country with no patent for the invention.
The patent, originally obtained by three Danish inventors, was apparently assigned to Edward Lifesciences AG and Edwards Lifesciences LLC, the plaintiffs in the infringement action. Edward Lifesciences (AG and LLC) had earlier won a jury verdict that CoreValve, Inc. and Medtronic CoreValve, LLC (“CoreValve”) were infringing the patent. Edward Lifesciences sought an injunction. The judge in the case rejected the request of the injunctions, noting that since the court was denying the request, the parties may negotiate a licence regarding future use of a patented invention before imposing an ongoing royalty. Also, the courted noted that since CoreValve would remain in the market with little or no interruption if the court were to enjoin its infringing US manufacturing operations due to its ongoing efforts to move its manufacturing of the accused product to Mexico, an injunction in this case would not affect the alleged harm.
Case Citation:
- Edwards Lifesciences AG and Edwards Lifesciences LLC v. CoreValve, Inc. and Medtronic Corevalve, LLC, Nos. 2011-1215, 2011-1257 (US District Court, Fed. Cir., November 13, 2012)
2009: Medtronic Sofamor Danek USA, Inc. v. Globus Med., Inc.
The fourth example was in a 2009 Pennsylvania infringement action between patentee Medtronic Sofamor Danek USA, Inc. and Globus Medical, Inc. concerning a dispute over patents pertaining to devices and methods used by spinal surgeons to stabilize bony structures, manufactured and marketed by Medtronic in a commercial embodiment called the “Sextant System,” and by Globus as the “Pivot System.” A jury found the patents infringed. Following unsuccessful settlement discussions, the parties agreed to a bench trial on the matter of damages and injunctive relief. The court refused to grant an injunction, and determined that a royalty rate of 15% of Globus’ sales would be applied to a royalty base of $13,901,795, resulting in a reasonable royalty of $2,085,269.20, plus prejudgment interest.
Case Citation:
- Medtronic Sofamor Danek USA, Inc. v. Globus Med., Inc., No. 06-4248 (US District Court, E.D. Pa., July, 16 2009)
2009: Bard Peripheral Vascular, Inc. v. W.L. Gore & Associates
In a 2009 case, patentee Bard Peripheral Vascular, Inc. sued W.L. Gore & Associates in Arizona for infringement of a patent for a prosthetic vascular graft. Finding infringement, the jury awarded damages, including reasonable royalty set at 10 percent. The court denied Bard’s motion for a permanent injunction, holding that a compulsory license was appropriate compensation; it wrote:
“The Court is satisfied that a fair and full amount of compensatory money damages, when combined with a progressive compulsory license, will adequately compensate Plaintiffs’ injuries, such that the harsh and extraordinary remedy of injunction-with its potentially devastating public health consequences–can be avoided.”
Case Citation:
- Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs., 2009 U.S. Dist. LEXIS 31328 (D. Ariz. 2009)
2007: Innogenetics, N.V. v. Abbott Labs
In 2007, Innogenetics brought suit in Wisconsin against Abbott Laboratories alleging that Abbott had infringed its patent for a method of genotyping the hepatitis C virus, marketed in the form of diagnostic test kits. The jury found that the patent had indeed been infringed, and, based on a consideration of a hypothetical negotiation for a license, it determined that Abbott should pay $7 million, which included a running royalty of 5 to 10 euros per test sold up until that time. The court evaluated Innogentic’s motion for injunctive relief by evaluating the eBay factors, finding that the public interest favored the denial of a permanent injunction, but that all other factors cut in favor of granting it. The court therefore granted the injunction. On appeal in 2008, however, the Federal Circuit vacated this injunction. Additionally, it found that the $7 million verdict was not a royalty limited only to Abbott’s past infringement, saying: “The reasonable royalties awarded to Innogenetics include an upfront entry fee that contemplates or is based upon future sales by Abbott in a long term market. When a patentee requests and receives such compensation, it cannot be heard to complain that it will be irreparably harmed by future sales.”
Case Citation:
- Innogenetics, N.V. v. Abbott Labs., Nos. 2007-1145, 2007-1161 (US Court of Appeals, Fed. Cir., January 17, 2008)
- Innogenetics, N.V. v. Abbott Labs., No. 05-C-0575-C (US District Court, W.D. Wis., January 3, 2007)
2006: Voda v. Cordis Corporation
In a 2006 case, Dr. Jan K. Voda alleged that three patents concerning an angioplasty guide catheter were infringed by Cordis (a Johnson and Johnson company). A jury found for Dr. Voda on infringement, and determined that he was entitled to a reasonable royalty of 7.5% of Cordis’ gross sales of the infringing catheters. Finding that Dr. Voda failed to demonstrate either irreparable injury or that monetary damages would be inadequate, the court denied his request for a permanent injunction.
Case Citation:
- Voda v. Cordis Corp., 2006 U.S. Dist. LEXIS 63623 (W.D. Okla. 2006)