Secondary patents are good – they incentivize improvements to existing drugs, make up for development costs, and are easily worked around

Because later-filed patents often claim aspects of a drug other than its active ingredient, these patents are sometimes called “secondary” patents.386 Critics of evergreening maintain that, by obtaining secondary patents on minor improvements or ancillary aspects of a pharmaceutical product, manufacturers effectively extend patent protection beyond the 20-year term set by Congress. In doing so, according to these critics, secondary patents unfairly shield pharmaceutical products from generic or biosimilar competition, thereby resulting in higher drug prices.387 In the view of evergreening critics, moreover, many of these secondary patents are of questionable validity.388 While secondary patents tend to be challenged more frequently by generics and more successfully than patents covering a pharmaceutical’s active ingredient, 389 the combination of secondary patents and a strong primary patent creates a barrier to generic entry because a generic manufacturer may delay or decline entry when faced with the prospect of defeating both patents.390 In 2019, the cost of litigating a Hatch-Waxman lawsuit was estimated to be around $5 million in cases involving over $25 million in risk.391 Commentators have suggested that these costs can be compounded when there are several patents at issue, even if some of those patents are relatively weaker.392 Thus, critics of evergreening argue that the costs of invalidating even comparatively weak patents strengthen the branded product’s position in the market and can lengthen its effective period of exclusivity.393 Defenders contend that there is nothing inherently suspect about secondary patents, which must meet the same requirements for patentability and pass through the same examination procedures as any other patent.394 Those requirements bar secondary patents on any obvious variation of the primary patent or on another product or invention already available to the public.395 “[I]t is often the case,” defenders contend, “that the value of a follow-on patent is comparable to, or might even exceed, that of a primary patent.”396 One example arguably supporting this view is the drug Evista (raloxifine). Evista was “initially studied as a potential treatment for breast cancer” but, in 1997, FDA approved the drug for the prevention of osteoporosis.397 At that time, there were a few years left on Evista’s initial patent, which was filed in 1983.398 One commentator has argued that if the brand could not patent the new use of the drug (i.e., for prevention of osteoporosis), insufficient incentives would have existed to make the investment in R&D necessary to bring the drug to market for the new use. 399 Thus, critics of the notion of “evergreening” argue the term is imprecise and unfairly pejorative, creating an inaccurate impression that secondary pharmaceutical patents somewhat exploit the patent system.400 Defenders also argue that the ability to receive a patent on a later-developed drug formulation provides a significant incentive to improve on or address problems with the original formulation. For example, the original formulation of Lumigan, which is used to treat glaucoma, could cause sufficiently severe red eye that patients would discontinue its use.401 Researchers subsequently developed an improved formulation with significantly decreased risk of this side effect.402 Defenders of secondary patents contend that without the possibility of patent protection for improvements, there would have been little incentive to perform this sort of research due to the significant costs involved.403 Secondary patents are also defended as necessary to recoup development costs. One study found that even though the patent term can last as much as twenty years, delays in PTO and FDA approval decrease the nominal Orange Book patent term to 15.9 years on average, and generic competition can result in an effective market exclusivity of 12.2 years.404 This effective market exclusivity is less than the sixteen years that another commentator suggests is necessary to recoup the brand’s costs for research, development, and clinical testing.405 Moreover, as secondary patents tend to be improvements to primary patents, they are typically narrower than those primary patents.406 Thus, brands argue that when the primary patent expires, any other company—including a generic—may enter the market and produce the invention covered by that primary patent, assuming the generic can design around any unexpired secondary patents.407 Doctors and patients can then decide whether the benefit conferred by a product covered by a secondary patent is worth the increased cost over the generic version of the product formerly covered by the primary patent.408 Defenders also note that congressional action has decreased the cost of challenging patents, potentially reducing the effect of later-filed secondary patents. After Congress enacted the AIA in 2011, generic and biosimilar manufacturers can use PTAB processes such as IPR,409 which was intended to “provid[e] a more efficient system for challenging patents that should not have issued; and reduc[e] unwarranted litigation costs.”410 Generally, any person who is not a patent’s owner may file a petition for IPR beginning nine months after the patent issues.411 The PTO then decides whether to initiate review of the patent.412 If review is initiated, then the patent challenger must prove that the patent is invalid by a preponderance of the evidence413—a lower requirement than the clear-and-convincing-evidence standard used when challenging the patent in court.414 The statute requires that the PTO’s final decision be issued not more than one year after the decision to institute review.415 The median cost for litigating an IPR to that final decision is $324,000. 416 Thus, IPR provides a faster and less expensive method to challenge issued patents, as compared to litigating patent validity in the courts.