November 3

David Mitchell

Allergan, a multibillion-dollar drug corporation, is attempting to perpetrate a fraud on the American people that would make Bernie Madoff blush — even as it casts itself as a victim.

Allergan makes several products, including Restasis, a very expensive brand-name drug that people with dry eye and related conditions take to increase tear production. Failure to treat this condition can impair vision and even lead to blindness.

Allergan is using an unprecedented legal ploy to keep a cheaper generic of Restasis from coming to market: transferring its patent rights for Restasis to the Saint Regis Mohawk tribe in upstate New York. By doing so, it aims to sidestep what’s called inter partes review, a type of patent challenge that is easier and faster to file than a lawsuit. As a sovereign tribal government, the Saint Regis Mohawk tribe claims immunity in inter partes review proceedings.

Congress created the inter partes review as part of the bipartisan Leahy-Smith America Invents Act of 2011 to more efficiently address patent challenges using expert panels at the U.S. Patent and Trademark Office. It is an alternative to costly litigation in federal court. Allergan has stated unabashedly that it transferred the patent to defeat an inter partes review.

The company said that it took this approach because the law is unfair. The company has whined about double jeopardy because patents can be challenged two ways — in federal court and under inter partes review.

In a ruling last week, federal judge William Bryson saw through the ruse. He not only invalidated several Restasis patents, but he also rebuked Allergan. “The Court has serious concerns about the legitimacy of the tactic that Allergan and the Tribe have employed,” he wrote in his decision. “The essence of the matter is this: Allergan purports to have sold the patents to the Tribe, but in reality it has paid the Tribe to allow Allergan to purchase — or perhaps more precisely, to rent — the Tribe’s sovereign immunity in order to defeat the pending IPR proceedings. … What Allergan seeks is the right to continue to enjoy the considerable benefits of the U.S. patent system without accepting the limits that Congress has placed on those benefits through the administrative mechanism for canceling invalid patents.”