Keeping pace with the ever-changing life sciences industry, Morrison Foerster stays on top of the trends and political, legal, and economic drivers to support striking the balance between innovative discovery and purposeful business planning to assure our clients continued success. MoFo Life Sciences shares timely legal and business insights and in-depth analyses on trends and the complex technologies at the heart of the global pharmaceutical, biotechnology, diagnostics, medical devices, digital health, and AgTech fields.Learn more about our <a href="https://www.mofo.com/capabilities/life-sciences-healthcare" target="_self">Life Sciences practice</a>.<h2 dir="ltr">ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

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Dr. Meghan Poon counsels clients on patent preparation and prosecution, portfolio strategy, and IP due diligence in the areas of biotechnology and biologics. She has significant experience in diverse technologies including antibodies, cell therapies, gene therapies, diagnostics, and gene-edited plants. She represents clients ranging from large international pharmaceutical companies to midsized companies, startups, and universities.Meghan has filed numerous Patent Term Extension applications to secure additional term for her clients’ patents, which cover FDA-approved products. In addition, Meghan has extensive experience addressing complex obviousness-double patenting and subject matter eligibility issues impacting her clients’ patent portfolios. Meghan also represents clients in both investor-side and target-side due diligence, in deals from seed funding to initial public offerings.Prior to law school, Meghan attended graduate school at the University of California, Los Angeles, where she received a Ph.D. in biological chemistry based on her work on protein-protein and protein-DNA interactions at a molecular level. Meghan is the author of several scientific publications and has presented her research at international conferences.Meghan received her J.D. from the University of Southern California Law School and spent a year as a visiting student at Santa Clara University, where she focused on intellectual property.

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Dr. Meghan Poon counsels clients on patent preparation and prosecution, portfolio strategy, and IP due diligence in the areas of biotechnology and biologics. She has significant experience in diverse technologies including antibodies, cell therapies, gene therapies, diagnostics, and gene-edited plants.

Meghan Poon

Wolfgang advises clients on contentious and non-contentious matters involving their most valuable intellectual property assets in life sciences, digital, and high-tech industries.His subjects of focus include research and development collaborations, complex licensing agreements, and other technology transactions, as well as know-how protection strategies, and employee invention law. He also has substantial experience in litigating patents, trademarks, and other intellectual property assets, often in a multijurisdictional context. In addition, Wolfgang and his team frequently clear trademarks and ad campaigns and prosecute trademark applications.Wolfgang is co-editor of our <a href="https://lifesciences.mofo.com/" dir="ltr" target="_blank">MoFo Life Sciences Blog</a>.Wolfgang is a partner of Morrison Foerster based in our German office in Berlin.<h4 dir="ltr">Representative Transactional Matters</h4><ul dir="ltr"><li>U.S.-based BioTech fund on various research collaborations and other transactions with German start-ups or research institutions.</li><li>Negotiate multimillion-euro strategic partnership between two AgTech leaders concerning the development and commercialization of pest-resistant transgenic traits.</li><li>Craft global multi-million collaboration regarding AI-powered robotic MaaS.</li><li>UK-based digital health company on product roll-out of RPM applications in Germany; coordinate international expansion.</li><li>Advise numerous German start-ups on their U.S. expansion.</li><li>Draft diverse global patent and know-how license agreements in the areas of AgTech and life sciences—including gene licensing and licensing of genome editing technologies (e.g., CRISPR)—and medical devices; draft correlating supply and distribution agreements.</li><li>Structure IP rights in connection with joint ventures and other M&A transactions, including the carve-out of a patent-heavy semiconductor business comprising nine jurisdictions into a German–U.S. joint venture.</li><li dir="ltr">Advise on government-funded, multi-partner R&D projects and/or R&D projects with academic institutions, as well as on employee invention law.</li></ul><h4 dir="ltr">Representative Contentious IP Matters</h4><ul dir="ltr"><li>Lead counsel in an international dispute between software companies on rights and obligations following termination of a multi-million licensing and distribution arrangement; coordinate local counsel.</li><li>Defend Japanese chip manufacturer in high-profile SEP-litigation; advise on global settlement arrangement.</li><li>Represent leading internet retailer in patent infringement and concurrent invalidity proceedings in the context of a multijurisdictional dispute concerning touch-screen technology.</li><li>Represent diverse pharmaceutical and life sciences companies in national and cross-border patent infringement proceedings and other technology-related disputes, including preliminary injunctions as well as pre‑trial discovery and inspection proceedings, concerning, inter alia, drug-coating technologies, toner cartridges, medicinal gases, transgenic plants, and vaccines.</li><li dir="ltr">Conduct trademark, copyright, and false advertising litigation, including, most notably, a high-profile trademark litigation for a German bank, and a nine-country cross-border trademark litigation involving a famous pharmaceutical brand.</li></ul>

Dr. Wolfgang Schönig berät Mandanten zum Schutz des geistigen Eigentums sowohl in streitigen als auch nichtstreitigen Angelegenheiten, mit einem besonderen Fokus auf die IP-rechtliche Beratung von Unternehmen aus den Bereichen Life Sciences, Digitalwirtschaft und High-Tech.Zu seinen Beratungsschwerpunkten gehören Forschungs- und Entwicklungskooperationen, komplexe Lizenzvertragsgestaltungen und andereTechnologie-Transaktionen, sowie Know-how-Schutz-Strategien und das Arbeitnehmererfinderrecht. Er verfügt zudem über umfangreiche Prozesserfahrung zur Durchsetzung von Patenten, Marken- und anderen IP-Rechten, häufig auch in einem grenzüberschreitenden Kontext. Darüber hinaus bewertet Dr. Wolfgang Schönig zusammen mit seinem Team regelmäßig die Rechtskonformität von Werbekampagnen, prüft die Verfügbarkeit von Marken und entwickelt entsprechende Anmeldestrategien.Dr. Wolfgang Schönig ist Co-Editor des Life Sciences Blogs von Morrison Foerster.Er hat seinen Doktortitel an der Heinrich-Heine-Universität Düsseldorf und seinen LL.M. an der Fordham School of Law in New York erworben, jeweils mit Schwerpunkt im gewerblichen Rechtsschutz. Seinen MBA-Abschluss erhielt er von der European University in Barcelona.Dr. Wolfgang Schönig ist Partner des deutschen Büros von Morrison Foerster in Berlin.<h4 dir="ltr">Repräsentative Transaktionen</h4><ul><li dir="ltr">BioTech-Fonds mit Sitz in den USA bei verschiedenen Forschungskooperationen und anderen Transaktionen mit deutschen Start-ups oder Forschungseinrichtungen</li><li dir="ltr">Verhandlung einer hochvolumigen strategischen Partnerschaft zwischen zwei Technologieführern im Bereich Crop Science betreffend der Entwicklung und Kommerzialisierung von bestimmten Resistenzen</li><li dir="ltr">Gestaltung einer globalen Multi-Millionen-Zusammenarbeit für KI-gestützte Roboter</li><li dir="ltr">Ein in Großbritannien ansässiges Unternehmen für digitale Gesundheit bei der Markteinführung von RPM-Anwendungen in Deutschland; Koordination der internationalen Expansion</li><li dir="ltr">Beratung zahlreicher deutscher Start-ups bei deren US-Expansion</li><li dir="ltr">Strukturierung und Verhandlung diverser Patent- und Know-How-Lizenzen in den Bereichen Ag Tech und Life Sciences – einschließlich Fragen zu genome editing wie CRISPR-Medizingeräte, sowie Gestaltung von Softwarelizenzverträgen und Erstellung korrespondierender Liefer- und Vertriebsvereinbarungen</li><li dir="ltr">Strukturierung von IP-Rechten im Zusammenhang mit Joint Ventures und anderen M&A-Transaktionen, darunter die Koordination eines neun Länder umfassenden IP Carve-Outs im Rahmen eines Halbleiter-JVs</li><li dir="ltr">Beratung zu staatlich geförderten Multi-Partner F&E-Projekten und/oder F&E-Projekten mit akademischen Einrichtungen sowie zum Arbeitnehmererfindungsrecht</li></ul><h4 dir="ltr">Repräsentative IP-Streitigkeiten</h4><ul><li dir="ltr">Lead Counsel in einem internationalen Rechtsstreit zwischen Softwareunternehmen über Rechte und Pflichten nach Beendigung einer millionenschweren Lizenz- und Vertriebsvereinbarung; Koordinierung der lokalen Anwälte</li><li dir="ltr">Verteidigung eines japanischen Chipherstellers in einem prominenten Streitfall bezüglich Standardessentieller Patente (SEP); Beratung zu einer globalen Vergleichsregelung</li><li dir="ltr">Verteidigung einer führenden Internetplattform gegen Ansprüche eines Patenttrolls wegen vermeintlicher Verletzung von Patent bezüglich Touchscreen-Technologie sowie korrespondierende US-Streitigkeiten</li><li dir="ltr">Vertretung von Pharma- und Life Science-Unternehmen in nationalen und grenzüberschreitenden Patentverletzungsverfahren und anderen technologiebezogenen Streitigkeiten, einschließlich einstweiliger Verfügungsverfahren und vorprozessualer Beweissicherungs- und Besichtigungsverfahren, unter anderem in Bezug auf Arzneimittelbeschichtungstechnologien, Tonerkartuschen, medizinische Gase, transgene Pflanzen und Impfstoffe</li></ul>

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Wolfgang Schönig is a partner of Morrison Foerster (International) LLP based in our German office in Berlin. His practice specialty is advising on IP aspects relative to transactions in, among others, the life sciences, AgTech and pharmaceuticals industry, as well as legal representation in IP disputes. Wolfgang is specialized in research and development collaborations, complex licensing agreements, technology acquisitions, know-how protection strategies, and employee invention law.

Wolfgang Schönig focuses his practice on IP aspects relative to transactions in the digital, telecoms, high tech, life sciences, and pharmaceuticals industry, as well as legal representation in IP disputes.

Wolfgang Schönig advises clients on IP aspects relating to transactions in, among others, the life sciences, AgTech and pharmaceuticals industry, as well as legal representation in IP disputes. His additional focus areas include research and development collaborations, complex licensing agreements, technology acquisitions, know-how protection strategies, and employee invention law.

Wolfgang Schönig

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Because No One is Immune to the Law

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Daralyn Durie, Janet Xiao and Katherine McNutt of Morrison Foerster explore strategies to reduce the threat of infringement liability in the complex environment of gene therapy development.

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Mitigating Patent Risk in Gene Therapy Development | MoFo Life Sciences

Daralyn Durie

Janet Xiao Ph.D.

Katherine E. McNutt

This article was first published by IAM on June 2, 2023 in its <a href="https://www.iam-media.com/report/special-reports/q2-2023/article/mitigating-patent-risk-in-gene-therapy-development" target="_blank">Special Report 2023 Q2: New Frontiers of Pharma and Biotech IP Strategy</a>.Daralyn Durie, Janet Xiao and Katherine McNutt of Morrison Foerster explore strategies to reduce the threat of infringement liability in the complex environment of gene therapy development.The Hatch-Waxman Act created a statutory safe harbor, codified in Section 271(e)(1), Chapter 35 of the US Code, which immunizes drug developers from patent infringement liability for certain activities related to developing and submitting information to regulators. For example, the safe harbor immunizes a generic drug manufacturer from patent infringement liability for using a branded company’s patented drug product to develop and submit information to the FDA as part of the approval process for that generic drug.Recent cases have limited its scope such that it may not protect the use of research tools or intermediate products in the development and submission of information to the FDA for approval of gene therapies. In view of this, gene therapy developers should consider other ways to mitigate exposure to patent infringement liability occasioned by the FDA approval process.Overview of the safe harborThe safe harbor was enacted as part of a response to two perceived distortions of patent terms for products subject to FDA approval. These were based on the interaction of FDA premarket approval requirements and limitations on patent term.First, patent holders effectively lost a portion of their patent term for FDA-approved products “[b]ecause patent applications were filed early in the regulatory process, but market entry was delayed pending regulatory review” (Proveris Sci Corp v. Innovasystems Inc.; 536 F3d 1256, 1265; Fed Cir, 2008).Second, those same patent holders gained a de facto PTE after their patents had expired because the patents delayed competitors’ ability to develop information for FDA approval of their competing products. That is, competitors could be liable for patent infringement if they used the patented, FDA-approved products to submit information to the FDA for approval of their competing products before the patents on the FDA-approved products had expired. To address the first perceived distortion, Congress enacted Section 156 (f)(1), Chapter 35 of the US Code, which provides for PTE to compensate for regulatory delays associated with obtaining FDA approval of a drug product, medical device, food additive or color additive subject to regulation under the Food, Drug and Cosmetic Act. The safe harbor was intended to address the second perceived distortion by immunizing the use of patented products subject to FDA premarket approval in FDA submissions seeking approval for competing products.In relevant part, Section 271(e)(1) provides:It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention . . . solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use or sale of drugs or veterinary biological products.Safe harbor in the courtsAlthough Section 271(e)(1) refers broadly to “a patented invention”, courts have interpreted this as limited by the policy considerations and perceived patent-term distortions that motivated the enactment of the statute. Specifically, they have limited “a patented invention” to a patented product subject to premarket FDA approval. This reflects “a ‘perfect’ product fit” between Sections 271(e)(1) and 156, the provisions that Congress enacted to address the “roughly offsetting … dual distorting effects of regulatory approval requirements in this entire area” (Eli Lilly & Co v. Medtronic Inc.; 496 US 661, 672 and 674; 1990). When a patented product does not require FDA pre-market approval, there is no de facto extension of the patent term – competitors may start using that patented product commercially immediately upon expiration of the patent – so the second perceived distortion that the safe harbor was designed to address does not occur. Applying that rationale, the Federal Circuit held in Proveris that Section 271(e)(1) did not immunize the use of a patented device from infringement when the device was “used in the development of FDA regulatory submissions but is not itself subject to the FDA premarket approval process” (536 F3d at 1265).In the gene therapy context, one court, applying Proveris, has held that using an intermediate patented product not subject to FDA approval to develop a gene therapy does not fall within the safe harbor. There, the Delaware district court concluded, at the motion-to-dismiss stage, that gene therapy developer Sarepta had not demonstrated that the safe harbor applied to its use of patented cultured host cells (an “intermediate patented product”) to develop gene therapies for Duchenne muscular dystrophy (REGENXBIO Inc v. Sarepta Therapeutics Inc.; 20-1226-RGA, 2022 WL 609141, at 1; D Del, 4 January 2022).Relying on Proveris, the court concluded that “a patented product that is not subject to FDA premarket approval is not a ‘patented invention’ under Section 271(e)(1)” (Id at 4). The court rejected Sarepta’s argument that the safe harbor should apply because its use of the patented cultured host cells “w[as] solely related to the development and future submission of a Biologics License Application to the FDA” (Id at 2). As Sarepta was “using the patented cells to develop its own patentable product” rather than “using the patented cultured host cells to obtain FDA approval to introduce generic cultured host cells”, the court found that the rationale underlying the safe harbor did not apply; Sarepta could begin using the patented cultured host cells immediately after the asserted patent expired (Id at 4). The logic was that the patentee would not receive a de facto PTE that the safe harbor was intended to address, notwithstanding that Sarepta’s inability to freely use the patented cultured host cells might delay the development and submission of information to the FDA for approval of its gene therapy.Sarepta is consistent with decisions of some other courts concluding that the use of patented ‘research tools’, themselves not subject to FDA approval, does not trigger the protections of the safe harbor, even when those tools are used to develop information for purposes of regulatory approval of another product. Research tools include “tools that scientists use in the laboratory including cell lines, monoclonal antibodies, reagents, animal models, growth factors, combinatorial chemistry and DNA libraries, clones and cloning tools (such as PCR), methods, laboratory equipment and machines” (64 Fed Reg 72,090, 72092, footnote 1; 23 December 1999). For example, courts have found that the safe harbor did not cover the use of a patented fluorescent protein and certain G-protein coupled receptors to develop information for regulatory approval of other products (see Allele Biotech & Pharms Inc v. Pfizer Inc.; 20-cv-01958-H-AGS, 2021 WL 1749903, at 7; SD Cal, 4 May 2021- denying motion to dismiss based on safe harbor defense when plaintiff’s complaint alleged that fluorescent protein was used as a research tool and that it was not subject to FDA review and approval; see also PSN Ill LLC v. Abbott Lab’ys; 09 C 5879, 2011 WL 444825, at 1 and 6; ND Ill, 20 September 2011 - denying defendants’ motion for summary judgment based on safe harbor defense when defendants used patented G-protein coupled receptors that did not require FDA approval to screen potential drug candidates and “develop their own patentable product”).At least one court has viewed these issues differently. In that case, the defendants used patented polypeptide markers to measure the molecular weight characteristics of their generic drug products to demonstrate to the FDA that their generic products’ active pharmaceutical ingredient was the same as the active pharmaceutical ingredient in the plaintiff’s branded drug (Teva Pharms USA Inc v. Sandoz Inc.; 09 Civ 10112(KBF), 2013 WL 3732867, at 1; SD NY, 16 July 2013). The court noted that “[t]he claimed markers are not themselves drug products, nor do they need approval from the FDA” (Id at 2). In reaching its conclusion that the safe harbor nonetheless covered the use of the polypeptide markers, Teva relied on the Supreme Court’s decision in Merck KGaA v. Integra Lifesci I Ltd for the proposition that “the Supreme Court held that use of patented peptides to conduct research not ultimately submitted to the FDA, but which furthered research and led to the development of testing for another drug, fell within the safe harbor” (Id at 6; citing Merck, 545 US 193, 206-07; 2005). In Merck, there was no dispute that the asserted patents covered the cyclic RGD polypeptides developed by the petitioner, and the “[r]espondents ha[d] never argued that the RGD peptides were used at Scripps as research tools” (Merck, 545 US 193, 201-02, 205, footnote 7; 2005). Some of the patented peptides at issue in Merck were used for research on other drug candidates, and one of the patented peptides was ultimately submitted for FDA approval in an investigational new drug application (Id at 197-99).Considerations for gene therapy developersGiven that some courts considering the issue have concluded that the safe harbor does not protect the use of research tools or intermediate products not subject to FDA approval to generate information for FDA approval of other products, gene therapy developers may face potentially significant patent infringement liability. For example, using patented research tools or intermediate products, such as host cells used to culture viral vectors that subsequently deliver gene therapies, may lead to patent infringement suits against gene therapy developers. Gene therapy developers should therefore be mindful of potential FTO risks with regard to patents covering research tools or intermediate products, even though those patents may expire before the projected commercialization date of their gene therapies. Defensively, these decisions counsel in favor of considering risk mitigation strategies, including conducting due diligence to determine whether third-party patents cover any intermediate products used in developing or manufacturing their gene therapies.Defensively, patent exhaustion may provide an alternative to the safe harbor for avoiding patent infringement liability based on the use of patented intermediate products not subject to FDA approval. When a patentee authorizes the sale of an item that substantially embodies the patentee’s patent claims, all patent rights to that item are exhausted, and the patentee loses the ability to bring an infringement suit related to that item (Quanta Comput Inc v. LG Elecs Inc.; 553 US 617, 638; 2008). Assuming that those intermediate products are patented, gene therapy developers should investigate whether any third-party supplier sells the intermediate product and whether they have a license from the patentee. To the extent that a gene therapy developer purchases patented products needed to develop gene therapies from a patentee or a licensee of the patent holder, patent exhaustion may be available as an affirmative defense, assuming the licensee has permission from the patent holder to sell the patented product to the developer (see, for example, PSN, 2011 WL 444825, at 9-11 - holding, based on language of license agreements, that patent exhaustion applied to receptors purchased from licensees after concluding that use of receptors was not covered by safe harbor).Gene therapy developers should consider whether to conduct due diligence to verify that their suppliers have such permission. The relevant license agreements may be confidential, making them unavailable to verify that the licensee has the requisite permission to sell the patented product. In that case, a gene therapy developer may be able to seek indemnification against patent infringement liability from the intermediate product supplier. Patent exhaustion may not provide a defense with regard to any subsequent cloning or manufacture of intermediate products by the developer.Once litigation has commenced, gene therapy developers may also be able to limit available damages for the use of an intermediate product by asserting that the patentee or its licensees failed to mark the patented intermediate product. (eg, Id at 12). To the extent that the patentee or its licensees manufacture the patented product and fail to mark that product, damages for infringement may be contained to the period beginning when the accused infringer had actual notice of the accused infringement (35 USC §287(a)). Absent a demand letter, a defendant may not receive actual notice until the complaint is served.From an offensive perspective, gene therapy developers should consider maintaining a broad patent portfolio with regard to innovations related to gene therapies and seeking PTE for patents covering their approved products whenever it is available. Obtaining PTE for patents on approved products may compensate for any regulatory delay in obtaining FDA approval. However, any PTE may not compensate for any time during which a third-party patent prevented the developer from submitting information to the FDA during the approval process.From a portfolio and enforcement perspective, gene therapy developers should consider drafting a varied set of patent claims to cover their gene therapies under development, including patents directed to newly developed research tools or intermediate products that do not require FDA approval. Having patents on research tools or intermediate products may position developers to manage competition and receive passive licensing revenue. Given the safe harbor defense, patents covering research tools or intermediate products that do not require FDA approval may hold significant value as against another developer working on a gene therapy to treat the same condition.Close attention to applicable license agreements and transactions involving intermediate patented products will benefit developers both offensively and defensively. From an offensive perspective, placing limitations on the scope of sales that licensees can make may limit the applicability of an exhaustion defense in subsequent offensive litigation; sales by the licensee that exceed the scope of the license may be found to be unauthorized, such that patent exhaustion would not apply. Defensively, it would behoove gene therapy developers to ensure that any applicable licenses provide, at every step in the chain from the patentee to the developer, all rights necessary for the development and manufacture of gene therapies. Patent exhaustion may not provide a defense if a developer obtains intermediate patented products through a sub-license rather than a purchase and later exceeds the scope of the rights to the patented product granted by the applicable sub-license. Seeking indemnification from suppliers of intermediate products may help gene therapy developers to mitigate the patent risk associated with those intermediate patented products. Indemnification may also assist gene therapy developers in mitigating potential risks related to non-patent claims, but such claims fall beyond the scope of this article.Mitigating risk in the futureThe implementation of statutory or regulatory reform may facilitate gene therapy development. Possibilities range from creating a new set of rules specific to gene therapies to implementing a compulsory licensing scheme for research tools or intermediate products akin to the fair, reasonable and non-discriminatory licensing scheme for SEPs. Unless and until that happens, gene therapy developers should take care to scrutinize any applicable licenses, pursue patents covering research tools or intermediate products and gene therapy products, preserve defenses to patent infringement, such as patent exhaustion, and preserve arguments to limit damages.

Mitigating Patent Risk in Gene Therapy Development

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