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Generic drug manufacturers have greater protection from claims of induced infringement in “skinny label” cases following a unanimous 9-0 victory before the U.S. Supreme Court in Hikma Pharmaceuticals v. Amarin Pharma. Skinny labels, more formally known as Section viii carve-outs, refer to the regulatory pathway that allows generic companies to enter the market by carving out still-patented medical indications from their labeling. Characterizing Amarin’s claims of Hikma’s actions as speculative and vague, the Court held that Amarin’s complaint cannot withstand Hikma’s Rule 12(b)(6) motion to dismiss.
The legal dispute centered on Amarin’s cardiovascular medication, Vascepa. Hikma sought approval of a generic version of the drug, submitting a skinny label that included only the non-patented indication. Amarin filed its complaint alleging induced patent infringement, arguing that “the totality of Hikma’s statements across several documents encouraged infringing uses.” The statements referenced in Amarin’s complaint included Hikma describing its product as a “generic version” or “generic equivalent” of Vascepa, providing selective sales metrics in investor and press communications that did not distinguish between the patented and nonpatented uses and online categorization of its generic drug in a broad category that encompassed both the patented and nonpatented uses.
Writing for the Court, Justice Ketanji Brown Jackson rejected Amarin’s argument. The Court clarified that to prove induced infringement:
Brand-name companies must prove the generic company took affirmative, active steps to encourage illegal use.
Merely describing a product as a generic version or matching labels to brand-name drugs does not constitute illegal inducement.
Speculative connections regarding how medical providers might read between the lines cannot be used to penalize standard industry practices.
Justice Jackson noted that the Court refused to put generic manufacturers “between a rock and a hard place by turning adherence to the law and industry standards into building blocks for illegal conduct.” And while Justice Jackson credited Amarin’s adherence to the Federal Circuit’s approach, “which has increasingly trained its focus on whether the relevant statements [from the generic company] could be read by medical providers as instructions to infringe,” she made clear that this “trend” was rejected by the Court. Rather, “the key question is whether a defendant actively encouraged infringement through its statements, not merely how others may understand those statements.”
With this ruling, the skinny-label pathway remains open, lowering barriers to market entry for generic manufactures.
