Team Merck to SEC, Tonight: “What We Know” and “What We Don’t.”

Another merger update was provided to Merck employees today, and filed, by Merck, with the SEC, tonight. It is interesting how careful Merck is to point out that the shareholders might not vote in favor of this particular reverse-merger structure — THRICE. (I’ve reprinted, and bolded it — below, along with some of the more salient bits), here. Wide tables don’t do well here — in this particularly narrow WordPress template.

More on the “Trouble for Temodar”, Today — Post-Trial Patent-Challenge Briefs Filed

“An Egregious Misuse of the Patent System. . . .“

After clearing a madatory one-week delay, to allow the redaction of trade secret material, Barr/Teva, Schering-Plough’s opponents in the Temodar patent litigation (Cancer Research Technologies, et al. v. Barr Laboratories, et al., Case 07-457 (SLR), US Dist. Ct., Del. — trial complete April 2, 2009 — awaiting decision) have laid waste to one of Schering-Plough’s central patent protection strategies in this challenge to the exclusivity for Temodar. Do click it to enlarge [a massive 2.6 Mb PDF File of the 60-page brief, full text]:

Background, from earlier SEC Form 10-Q, and federal District Court filings:

. . . .in July 2007, Schering-Plough and its licensor, Cancer Research Technologies, Limited, filed a patent infringement action against companies seeking approval of a generic version of certain strengths of TEMODAR capsules. The trial concluded April 2, 2009. A decision has not yet been rendered. . . .

[Much more on Schering-Plough's "In Substance" Patent Cliffs, more generally, here.]

[From the Delaware filings -- Barr/Teva's Disputed Questions of Law:]

. . . .‘291 Patent is Unenforceable Due to Prosecution Laches Resulting from [Schering's] Delay in Prosecuting the Applications Leading to the Issuance of the ‘291 Patent

Prosecution laches is an equitable doctrine that “may render a patent unenforceable when it has issued only after an unreasonable and unexplained delay in prosecution,” and may be applied even though a patent applicant complies with pertinent statutes and rules. Symbol Tech., Inc. v. Lemelson Med. Educ. & Research Found., 422 F.3d 1378, 1385 (Fed. Cir. 2005); In re Bogese, 303 F.3d 1362, 1367 (Fed. Cir. 2002). When addressing the issue of the burden of proof applied to prosecution laches, this Court has agreed with other district courts that “the preponderance of the evidence standard should apply. . . .”

. . . .As an equitable doctrine, there are no firm guidelines for determining when prosecution laches should render a patent unenforceable, and the determination is “subject to the discretion of a district court before which the issue is raised.” Symbol Tech., 422 F.3d at 1385. Prosecution laches requires “an examination of the totality of the circumstances.” Id. at 1386. Factors district courts have considered to determine whether a delay in prosecution was unreasonable are (1) whether the prosecution history of the patentee’s patents is atypical of patents in that field or patents generally; (2) whether there are unexplained gaps in the prosecution history; (3) whether the patentee took any unusual steps to delay the application process; (4) whether a change in the patentee’s prosecution of the application coincided with or directly followed commercial developments or evolutions in the field of the claimed invention; and (5) whether legitimate grounds can be identified for the abandonment of prior applications. . . .

With so much focus on health care reform, this case may well become the “poster child” for Big Pharma’s more-than-occasional alleged abuse of the United States patent system — to (in this case) delay the start date of patent protection, until the manufacturer (Schering-Plough) is in the best position to keep any potential generic competitors (Barr/Teva) off the US market-shelves for the longest period of time imaginable. Once again, pressing too hard – torturing the facts, and the law — Schering-Plough may yet reap the exact opposite of the result it originally sought. We shall see.

Merck’s Zostavax is “Back” — Raw Material Potency Returns — Has Cleared Order Backlogs

Vaccine manufacturing is a very complicated proposition — and almost-unimaginably more complicated, when one needs to acheive the immense-scale bulk operations a blockbuster franchise biological requires — to reach many markets in vast quantities, and in a timely fashion, to boot. Merck’s biological engineeers know this only too well:

Per this morning’s The Wall Street Journal — this looks to be $320 million added back into revenue — assuming the Whitehouse Station biological engineers have solved the bulk raw material potency problems, for good:

. . . .Merck & Co. (MRK) is back to normal shipping times for its Zostavax shingles vaccine after a year of prolonged delays caused by supply constraints for a key ingredient.

The resolution of back orders is just one milestone in Merck’s attempt to bounce back from various problems plaguing its vaunted vaccines unit.

The Whitehouse Station, N.J., company cleared back orders for 10-dose packs of the vaccine in April and for single-dose shipments earlier this month, said spokeswoman Amy Rose. Merck has resumed shipping the product to doctor’s offices and other health-care providers within three to five days of order placements. . . .

Thus, Merck is up about 2.5 percent on the NYSE this morning; Schering-Plough is up about half of that.