The estoppel provision of 35 U.S.C. § 315(e) does not “relax” the injury-in-fact standard required to establish standing under Article III of the U.S. Constitution.
Earlier this month, the Federal Circuit dismissed an appeal from the Patent Trial and Appeal Board (Board) where the Board upheld the patentability of a biologics patent. After Momenta Pharmaceuticals petitioned the Board for an inter partes review (IPR) of the patentability of Orencia® (abatacept), the Board sustained patentability and Momenta appealed. During the course of the appeal, Momenta ceased development of an abatacept biosimilar. The Federal Circuit held that the cessation of potential infringement mooted the injury and removed Momenta’s standing to maintain the appeal. Momenta Pharm., Inc. v. Bristol-Myers Squibb Co., No. 2017-1694, 2019 U.S. App. LEXIS 3786 (Fed. Cir. Feb. 7, 2019) (Before Newman, Dyk, and Chen, Circuit Judges) (Opinion for the Court, Newman, Circuit Judge).
The case began in July 2015 when Momenta petitioned the USPTO for IPR of Bristol-Myers Squibb’s (BMS) patent on the biologic abatacept. At the time of the petition, Momenta was pursuing a biosimilar counterpart to the innovator drug. After the Board found Momenta failed to establish the abatacept patent is unpatentable, Momenta appealed under 35 U.S.C. § 319.
BMS first challenged Momenta’s Article III standing to appeal by stating Momenta failed its Phase 1 clinical trials for the biosimilar, and the biosimilar had been withdrawn from Food and Drug Administration (FDA) review. Momenta responded by asserting (i) “it had not abandoned its intent to produce” a biosimilar, (ii) the abatacept patent is an obstacle to produce a biosimilar, and (iii) it was “injured by the estoppel provision, 35 U.S.C. § 315(e).” Momenta cited a “‘relaxed’ standard for Article III compliance when the right of appeal is established by statute.”
In October 2018, Momenta filed a Letter to the Court citing a press release stating, “The company has initiated discussions with its collaboration partner, Mylan, to exit its participation in the development of” the abatacept biosimilar. Momenta informed the Court it would update the Court as to any outcome of those discussions.
The Court issued an Order to Show Cause why the appeal should not be dismissed. Momenta argued that it was still jointly responsible for the development of the biosimilar, and that Momenta and its partner, Mylan, still face the “same fork in the road about the commercial formulation for their biosimilar product.” A declaration from Momenta’s Chief Business Officer also stated Momenta had yet to reach an understanding about withdrawing from the development of the biosimilar, and that Momenta may still potentially have the right to receive royalties from Mylan should Mylan continue development. BMS responded stating “the possible future royalty . . . is too speculative to support standing.”
In December of 2018, BMS filed a Letter and enclosed Momenta’s submission to the Securities and Exchange Commission (SEC) stating Momenta had “elected to terminate [its] collaboration with Mylan with respect to the development” of an abatacept biosimilar. Momenta did not respond, nor did it withdraw the appeal.
Article III: A Hard Floor
The Court began its analysis of Momenta’s standing by stating, although immediacy and redressability may be “relaxed” by statute, “the requirement of injury in fact is a hard floor of Article III jurisdiction that cannot be removed by statute.” Citing Summers v. Earth Island Institute, 555 U.S. 488 (2009). The Court stated that, despite Momenta’s arguments about spending millions of dollars on development of the biosimilar, Momenta had not shown “‘an invasion of a legally protected interest’ … that is ‘actual or imminent, not conjectural or hypothetical.’” Quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992).
Momenta first argued that the America Invents Act provided an alternative to district court litigation, and “appeal should be available from the PTAB as it would be from a district court decision.” Momenta cited the estoppel provision in 35 U.S.C. § 315(e). The Court disagreed, stating it now has “exited” any potential infringing activity by ceasing development of the biosimilar.
Momenta next argued that it may receive a royalty from Mylan should Mylan produce an abatacept biosimilar. The Court held that this was too speculative of the “choices made by independent actors not before the court.” Quoting Clapper v. Amnesty Int’l USA, 568 U.S. 398, 415 n.5 (2013).
Finally, Momenta argued that, because it was engaged in potentially infringing activities when it petitioned for IPR, it has not lost standing in this appeal. The Court reiterated that “jurisdiction must exist throughout the judicial review, and an intervening abandonment of the controversy produces loss of jurisdiction.” Citing Arizonans for Official English v. Arizona, 520 U.S. 43, 67 (1997).
In rejecting Momenta’s arguments that it maintained standing, the court held “momenta no longer has the potential for injury, thereby mooting the injury.” The Court subsequently dismissed Momenta’s appeal of the Board’s decision upholding the validity of BMS’s abatacept patent.