What’s wrong with having lots of patents? Humira ‘patent thicket’ survives antitrust challenge


Last week, on 1 August, the US Court of Appeals for the Seventh Circuit issued a long-awaited ruling in the Humira antitrust litigation, affirming a June 2020 decision by District Judge Shah that AbbVie’s patent acquisition and enforcement practices did not breach federal antitrust laws.

Humira (adalimumab) is an anti-inflammatory biologic used in the treatment of rheumatoid arthritis, Crohn’s disease, and psoriasis, among other conditions.  It’s the world’s best-selling drug, earning more than $20 billion globally in 2021.  The basic US patent for Humira expired in 2016, but AbbVie, its owner, obtained 132 additional patents relating to the drug, the last of which expires in 2034.  Indirect purchasers of Humira brought a class action against AbbVie in 2019, alleging that the ‘thicket’ of additional patents and related settlement agreements illegally prevented AbbVie’s rivals from entering the market with cheaper biosimilar alternatives.

In rejecting the claimants’ contention that the sheer number of Humira-related patents scared off competitors and enabled AbbVie to earn illegitimate monopoly profits, the Seventh Circuit asked: “But what’s wrong with having lots of patents? If AbbVie made 132 inventions, why can’t it hold 132 patents?”  The Court observed that US patent laws “do not set a cap on the number of patents any one person can hold – in general, or pertaining to a single subject”.  The Court recognised that “invalid patents cannot be used to create or maintain a monopoly”, but emphasised that the claimants did not allege that all of the patents were invalid or that AbbVie had committed fraud on the US patent office by filing the patent applications.  The claimants’ argument that AbbVie’s patents were ‘weak’ was given similarly short shrift: “Weak patents are valid; to say they are weak is to say that their scope is limited, not that they are illegitimate.”

The Seventh Circuit also agreed with the district court judge that AbbVie’s settlements with biosimilar companies, which delayed their market entry in the US but permitted earlier entry in Europe, were not illegal ‘pay-for-delay’ agreements.  According to the claimants, AbbVie gifted biosimilar manufacturers more than four years of profits in Europe, in exchange for their agreement not to enter the US market until 2023.  The Seventh Circuit was unpersuaded, viewing the US and EU settlements as “traditional resolutions of patent litigation”.  The Court concluded: “On each continent AbbVie surrendered its monopoly before all of its patents expired, and the rivals were not paid for delay. It would be much too speculative to treat the different entry dates as some kind of ‘reverse payment’ rather than a normal response to a different distribution of legal rights under different patent systems.

The Seventh Circuit’s ruling sets a high bar for challenging large portfolios of patents under US antitrust law and will doubtless be welcomed by patent owners in the pharma sector.  If patent thickets are a problem, as leaders at the FDA and the US House of Representatives’ Committee on Oversight and Reform have suggested, then a legislative solution may be required.  District Judge Shah said as much in his June 2020 decision: even if patent examiners are “having the wool pulled over their eyes more than half the time […], the proper fix is not to use antitrust doctrine” because that “will not revamp the FDA’s biologics application process or the USPTO’s drug patenting process”.

Without structural reform of the US patent system and other patent regimes around the world, aggressive patent strategies of the type at issue in the Humira case are likely to be a feature of the pharma sector for some time to come.