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January 31, 2025
This month the Supreme Court denied certiorari on Edwards Lifesciences Corp. v. Meril Life Sciences Pvt. Ltd., and in doing so, seemingly indicated its support for a broad interpretation of the Hatch-Waxman safe harbor provision of 35 U.S.C. § 271(e)(1).1 (Prior to its inclusion in the Hatch-Waxman Act it was known as the Bolar exemption). The exemption protects from patent infringement activities “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.”2 At issue in Edwards is the meaning of the word “solely” within the statute.3
The Federal Circuit has already had numerous encounters with the safe harbor provision. That the Supreme Court twice issued opinions on the issue (Eli Lilly & Co. v. Medtronic, Inc., 496 U.S. 661 (1990) and Merck KGaA v. Integra Lifesciences I, Ltd., 545 U.S. 193 (2005)) demonstrates the importance of the exemption. This question of statutory interpretation has split Federal Circuit panels,4 divided district courts,5 and sparked industry debates.6
Meril, an India-based medical device company, imported two transcatheter heart valves into the United States for the 2019 Transcatheter Cardiovascular Therapeutics Conference in San Francisco.7 The valves were never displayed or offered for sale at the conference, but were imported by Meril to use in discussions with potential FDA clinical researchers.8 As it turns out, Meril never presented the valves at the conference, and the valves remained in a storage closet for the duration of the conference.9 In October 2019, following the conference, Edwards, a competing medical device company, alleged that the importation of the two valves constituted patent infringement.10 Meril countered that its actions fell within the safe harbor provision of 35 U.S.C. § 271(e)(1), which exempts “an act of infringement to … import into the United States a patented invention … solely for uses reasonably related to the development and submission of information”11 under Federal laws regulating medical devices.12
The Federal Circuit, in a split decision, affirmed the Northen District Court of California’s summary judgment finding of noninfringement.13 The majority held that when “read in context, ‘solely’ modifies ‘for uses,’” and so, the safe harbor exception in Section 271(e)(1) applies to “acts or uses that bear a reasonable relation to the development and submission of information to the FDA.”14 The Federal Circuit also stated that the safe harbor protection applies irrespective of intent or ancillary commercial uses, as long as the actions bear a reasonable connection to FDA submission.15 In other words, as long as an act has some regulatory use, it will fall under the protection of the safe harbor provision – “it is not that the use must only be reasonably related to the development and submission of information to the FDA.”16
Here, the majority found that the importation of the transcatheter heart valves was “reasonably related” to the federal regulatory process.17 The Federal Circuit emphasized that because Meril brought the heart valves to a conference attended by a significant number of clinical trial investigators and was in continuous communication with the FDA about its submission and possible clinical study, Meril imported the valves in furtherance of obtaining FDA approval.18 The Federal Circuit then concluded that although Meril may have had additional alterative incentives in importing the heart valves, because the importation had a regulatory use, Meril’s act was still protected by the safe harbor provision.19
Judge Lourie dissented.20 He argued that the majority failed to recognize the meaning of the word “solely” in interpreting Section 271(e)(1) and that the term “solely” should strictly confine the safe harbor to activities exclusively intended for FDA submissions.21 He cautioned against an overly expansive interpretation that could lead to abuse, emphasizing the importance of considering the infringer’s intent and suggesting that mixed-purpose acts should disqualify those acts from the safe harbor protection.22
Edwards, in its petition for certiorari, agreed with Judge Lourie and argued that the Federal Circuit improperly interpreted the safe harbor provision of Section 271(e)(1).23 Edwards similarly contended that the Federal Circuit diluted the term “solely,” allowing acts that have mixed regulatory and commercial uses to fall under the protection of the safe harbor provision.24 Advanced Medical Technology Association filed an amicus curiae brief in support of Edwards’s petition.25 Edwards reply restated its position.26
Meril’s opposition agreed with the Federal Circuit and contended that “solely” modifies “for uses,” so that the safe harbor applies to acts or uses that are “reasonably related” to FDA approval, not to acts or uses that are exclusively related to FDA approval.27 In other words, the safe harbor provision requires first identifying the relevant “acts or uses,” and then determining whether those acts or uses are “reasonably related” to FDA approval.28 Here, Meril contends there was only one act – the importation of two heart valves for a medical conference – which was reasonably related to regulatory approval, and thus, within the safe harbor provision of Section 271(e)(1).29
The Supreme Court declined to consider the case. The issue of statutory interpretation raised in Edwards is an important one as it underscores the balance between patent protections and regulatory requirements. The Supreme Court’s denial of certiorari may indicate support for a broader interpretation of the safe harbor provision. This aligns with the provision’s intent to allow development efforts without infringing existing patents and is certainly favorable news for medical device and pharmaceutical companies.
Nonetheless, the Supreme Court’s denial of cert leaves open the interpretation of the scope of the safe harbor for another day. And any party relying on the safe harbor should remember that presently it is the defendant’s burden to establish that each activity falls within the safe harbor.30 And failure to factually establish the safe harbor has resulted in significant verdicts including for, example, a $70 million verdict for merely manufacturing a biologic that was never sold to customers.31 Thus, contemporaneously evaluating with counsel and documenting facts supporting a safe harbor exemption is still a best practice to mitigate risk.