A Day Late, A Buck Short: Or How to Lose PTE Without Really Trying

One of the most stringent rules that must be followed to obtain a patent term extension (PTE) after drug approval is the submission of an application for said PTE within 60 days.  As we noted in an earlier post, there have been various instances in which FDA-regulated companies (or their counsel) have failed to timely submit a PTE application to the U.S. Patent and Trademark Office (PTO) within the statutory 60-day window (see, e.g., here), the most famous of which concerns U.S. Patent No. 5,196,404 covering ANGIOMAX (bivalirudin).  In 2024, that’s exactly what happened when Taiho Pharmaceutical Co. Ltd. (“Taiho”) submitted its PTE application for LYTGOBI a day late—on November 29th instead of November 28th—arguing that a corrected approval letter dated October 5, 2022 superseded the original approval letter from September 30, 2022.  Unfortunately for Taiho, that argument did not prevail.

As background, PTE is available to compensate sponsors for the time on their patents lost to regulatory development and approval.  But there are several caveats.  Relevant here, the PTE application must be submitted within 60 days in accordance with the language of the PTE statute at 35 U.S.C. § 156(d)(1), which states:

To obtain an extension of the term of a patent under this section, the owner of record of the patent or its agent shall submit an application to the Director. Except as provided in paragraph (5), such an application may only be submitted within the sixty-day period beginning on the date the product received permission under the provision of law under which the applicable regulatory review period occurred for commercial marketing or use, or in the case of a drug product described in subsection (i), within the sixty-day period beginning on the covered date (as defined in subsection (i)). . . .

For purposes of determining the date on which a product receives permission under the second sentence of this paragraph, if such permission is transmitted after 4:30 P.M., Eastern Time, on a business day, or is transmitted on a day that is not a business day, the product shall be deemed to receive such permission on the next business day. For purposes of the preceding sentence, the term “business day” means any Monday, Tuesday, Wednesday, Thursday, or Friday, excluding any legal holiday under section 6103 of title 5.

Thus, the 60-day period starts on the day of approval unless that approval was transmitted after 4:30 pm eastern, in which case the 60-day period starts the next day.

In this case, FDA sent Taiho an initial approval letter on September 30, 2022 at 12:08 pm with a copy by email at 12:15 pm.  However, Taiho alerted FDA to problems with the FDA-approved labeling that same day and sent a formal letter on October 3, 2022.  FDA corrected the issues and sent a Corrected Approval Letter on October 5, 2022.  Importantly, that Corrected Approval Letter expressly stated, “The effective action date will remain September 30, 2022, the date of the original [Approval] letter.”  Taiho submitted a PTE application on November 29, 2022, which expressly stated that Taiho received permission for commercial marketing or use on September 30, 2022.  Taiho sought an extension until September 30, 2036.

On September 30, 2023, the PTO indicated—and FDA eventually affirmed—that Taiho’s PTE applications were not timely filed because they were submitted a day too late and, therefore, Taiho’s PTE would not be eligible for an extension of the patent term under 35 U.S.C. § 156.   Taiho amended its PTE application two weeks later to revise the approval date to the date of the Corrected Approval Letter, October 5, 2022, and argued that the errors in the Original Approval Letter prevented FDA from granting permission for commercial marketing or use because it would have constituted false or misleading branding under the FDCA’s enforcement provision. Taiho thus contended that valid FDA permission for commercial marketing or use did not exist until October 5, 2022.  The PTO disagreed: On March 18, 2024, the PTO determined that Taiho’s PTE application was ineligible for an extension due to untimely submission—the application was actually due November 28, 2022 based on 60 days from the September 30, 2022 approval.   The PTO explained that its PTE determination was based on the representations contained in the PTE application, citing to Taiho’s own admissions that its product received permission for commercial marketing use on September 30, 2022, and rejected Taiho’s position that it received valid permission on October 5, 2022.

Taiho sued, which required the District Court for the District of New Jersey to decide whether the government correctly interpreted the statute to start running the clock for the 60-day filing period on September 30, 2022; whether the government’s application of the 60-day window was arbitrary and capricious; and whether the government acted contrary to law.   The government argued, and the Court agreed, that the statutory language unambiguously creates a 60-day filing period that commences on and includes the date on which FDA transmits its permission to commercially market a new drug.   “A full reading of the plain language of Section 156(d)(1) leaves no room for equivocation,” which the Court found was also supported by congressional intent. Taiho Pharm. Co. v. Squires, 2026 U.S. Dist. LEXIS 244401, at *16.  Further, Taiho had admitted in its initial PTE application that it received permission from FDA for marketing and commercial use on September 30, 2022, and that the 60-day period to file the PTE application commenced on the same date.   Accordingly, the Court concluded that the government did not act arbitrarily or capriciously when it began counting the 60-day period on the same date Taiho received FDA approval for commercial and marketing use.

While Taiho contended that the government’s decision, recognizing September 30, 2022 as the date on which LYTGOBI received permission for commercial marketing and use, was arbitrary and capricious because the product was at that time misbranded, the fact that Taiho admitted in its PTE application that September 30, 2022 was the date on which it received permission persuaded the Court.  Further, Taiho failed to show that FDA actually deemed LYTGOBI to be misbranded or, otherwise, withdrew permission of Taiho’s NDA for commercial marketing or use on that basis.  Nor did FDA condition its approval for commercial marketing or use on Taiho submitting any subsequent labeling.  Accordingly, there was no basis to use October 5, 2022 as the approval date.

The Court recognized that the “consequences” of its decision were “drastic,” as Taiho lost valuable patent rights over “a mere administrative oversight involving a single day,” but noted that both the statute and administrative record were clear that the relevant approval date was September 30, 2022.  Id. at *32.  “The Court is bound by them. Had there been any discretion allotted under these circumstances, the Court would quite confidently have reached a different result. But no such discretion is given here.” Id.

Taiho has taught us an unfortunate lesson: Always submit your PTE application early.