WASHINGTON The U.S. Supreme Court on Wednesday appeared closely divided as it weighed Teva Pharmaceutical Industries Ltd's high-profile fight with generic drug manufacturers over patent protections for Copaxone, its top-selling multiple sclerosis drug.
Israel-based Teva is battling to protect a key patent for the $4-billion-a-year MS drug that is due to expire in September 2015. Copaxone accounts for 50 percent of Teva profits, and the patent fight is one of the most important business cases of the current term for Supreme Court's nine justices.
There are two teams developing cheaper generic forms of Copaxone: one involving Novartis AG's Sandoz Inc and Momenta Pharmaceuticals Inc and another involving Mylan Inc and Natco Pharma Ltd.
The justices appeared unsure over to what extent the U.S. Court of Appeals for the Federal Circuit, which hears all patent appeals, should have leeway to second-guess findings made by a district court judges about patent claim construction, the key issue in the case.
The appeals court ruled in favor of the generic companies, overturning a lower court ruling that had gone Teva's way.
Several justices, including Chief Justice John Roberts and Justice Samuel Alito, appeared reluctant to tinker with the existing system in which the appeals court is accorded great latitude in rethinking lower court findings.
"Is it worthwhile as a practical matter?" Alito asked, referring to the notion of disrupting the status quo.
Justice Sonia Sotomayor added, "Why don't we defer, as has been done now forever, to the Federal Circuit?"
Other justices seemed more concerned about the appeals court exerting too much power over lower court judges. Justice Stephen Breyer cited other areas of the law in which lower court judges have discretion.
Federal district judges, unlike appeals court judges, can preside over lengthy hearings and weigh all the evidence firsthand before issuing decisions, which is a "powerful reason for saying in a technical case, 'Don't overturn the judge's factual findings,'" Breyer said.
Justice Elena Kagan made a similar point that under federal law there is a "very blanket rule" that restricts what issues appeals courts can normally review on appeal.
In July 2013, the appeals court ruled the patent was invalid, prompting Teva to seek Supreme Court review. The Supreme Court declined to stay the appeals court ruling pending appeal, meaning Copaxone currently has no patent protection.
With the fate of the patent uncertain, Mylan has said it plans to launch as soon as it has government approval, which could be before the end of 2014. Sandoz and Momenta declined to comment on when they expect their product to be available.
Teva, meanwhile, is switching patients with multiple sclerosis, an often-disabling nervous system disease affecting the brain and spinal cord, who use Copaxone over to a new patent-protected formulation of it.
A ruling is due by the end of June. The case is Teva Pharmaceuticals v. Sandoz, U.S. Supreme Court, No. 13-854.
(Reporting by Lawrence Hurley; Editing by Will Dunham)