January 22, 2019
Decided January 22, 2019
Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA Inc., No. 17-1229
Today, the Supreme Court held that confidential licensing agreements can trigger the Leahy-Smith America Invents Act’s “on-sale” bar, which prohibits awarding patents to claimed inventions that have already been “in public use, on sale, or otherwise available to the public.”
In order to finance the development of a new pharmaceutical drug, Helsinn entered into a licensing agreement with another pharmaceutical company, MGI Pharma. Under the agreement, MGI Pharma received the right to purchase and eventually distribute the drug if it obtained the appropriate governmental approval. Although the existence of the licensing agreement was itself made public, MGI Pharma was required to keep confidential all proprietary information related to the drug. More than a year after entering into the licensing agreement with MGI Pharma, Helsinn applied to patent its new drug. The Leahy-Smith America Invents Act’s “on-sale” bar prohibits awarding patents for claimed inventions that were “in public use, on sale, or otherwise available to the public” for more than one year before a patent application is filed.
Whether entering into a confidential licensing agreement can place the underlying invention “on sale” such that it triggers the Leahy-Smith America Invents Act’s “on-sale” bar.
Yes. A commercial sale to a third party who is required to keep the invention confidential may place the invention “on sale” under the Leahy-Smith America Invents Act.
“In light of this settled pre-[America Invents Act (“AIA”)] precedent on the meaning of ‘on sale,’ we presume that when Congress reenacted the same language in the AIA, it adopted the earlier judicial construction of that phrase.”
Justice Thomas, writing for the unanimous Court
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