Case 1:05-cv-12237-WGY

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UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS ) ) ) Plaintiff, ) ) v. ) ) ) F. HOFFMANN-LA ROCHE ) LTD., a Swiss Company, ROCHE ) DIAGNOSTICS GmbH, a German ) Company and HOFFMANN-LA ROCHE ) INC., a New Jersey Corporation, ) ) Defendants. ) __________________________________________) AMGEN INC.,

Civil Action No.: 05-12237 WGY

AMGEN’S POST-TRIAL BRIEF FOR THE REMEDY PHASE AND RESPONSE TO DEFENDANTS’ JANUARY 28, 2008 PROPOSAL

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Case 1:05-cv-12237-WGY

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TABLE OF CONTENTS Page No. I. II. INTRODUCTION .............................................................................................................. 1 AMGEN PROVED AT TRIAL THAT A PERMANENT INJUNCTION SHOULD BE ENTERED BECAUSE THE FOUR FACTORS WEIGH HEAVILY IN FAVOR OF AN INJUNCTION. ................................................................ 8 A. B. C. D. E. Overview of the evidence and legal standard. ........................................................ 8 Amgen will suffer from irreparable injury unless a permanent injunction is granted.............................................................................................. 12 Remedies available at law are inadequate to compensate for Amgen’s irreparable injury................................................................................................... 15 The balance of hardships weighs in Amgen’s favor............................................. 17 The public interest would not be disserved by an injunction................................ 19 1. 2. The public interest is best served by a result that honors a robust and predictable patent system that rewards innovation. ........................... 19 There is no assurance that permitting the infringement of Amgen’s patents under terms compelled by the Court will reduce public health care spending. .......................................................... 24 The public interest would not be disserved by an injunction where peg-EPO does not address an unmet medical need and is not clinically superior to currently available ESAs. ................................. 28 a. b. F. The public interest is in gaining access to therapies that address unmet medical needs and peg-EPO does not................... 29 There is no evidence that Roche’s product is clinically superior to established ESAs. ....................................................... 35

3.

A permanent injunction is not precluded by Roche’s unclean hands or patent misuse defenses.......................................................................................... 36 1. Amgen’s agreement with Fresenius — voluntarily negotiated and entered into without coercion — is lawful and does not support Roche’s unclean hands defense. .................................................. 38 Amgen does not and cannot incentivize overuse of ESAs. ...................... 40

2.

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3. 4. 5. III.

Amgen’s pro-competitive, multi-product rebates in oncology do not constitute unclean hands or patent misuse.......................................... 41 Amgen is entitled to enforce Dr. Lin’s Patents and is not obligated to guarantee discounts in perpetuity.......................................... 42 Amgen does not withhold products from dialysis providers .................... 44

RESPONSE TO ROCHE’S JANUARY 28, 2008 PROPOSAL ...................................... 45 A. B. C. Roche’s Proposal would exact a higher reimbursement from Medicare. ............. 46 Roche’s proposed 20% royalty will not adequately compensate Amgen for even its economic losses. ................................................................................ 49 Roche is asking the Court to take the profits of Amgen, the proven innovator, and award them to Roche for its infringement — all in the name of the public interest.................................................................................... 53

IV.

CONCLUSION................................................................................................................. 53

ii

.. Bard.........3d 1369 (Fed............. 16 Critikon. 11......... Dist.......... Supp. Schering-Plough Corp..................... v................................ SciMed Life Sys... v.. A............. Nortron Corp.. 1996) .................................. 37 Bell & Howell Document Mgmt............. Co.... v........... 11................ 04-1098........ v.. v.............. v..Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 4 of 63 TABLE OF AUTHORITIES Page No.. Tex. v.. 132 F.. Nov.......S. v.... May 28. 1993 U... CASES Abbott Lab........................ M3 Sys............... July 16........... Cir............. 2005)....................... Dist............. Del..... 03-238.... 2d 600 (E... 23........ v.. 33......... App........ 20........................ 18................ LEXIS 21338 (D............ Kirschner Med.... 713 F..... Cir........... Gen........ 28 Cordis Corp......... Cir..........J....... 16 Bio-Tech. 500 F.. 10.. 22 AG v. 2003 U.. Inc.. Sandoz... LEXIS 19959 (D..... 106 F... 28... No..... 492 F. Corp.. Prods... Dillon & Co............ 11 Cordis Corp.............................. 1994).... 813 (D........... Altek Sys... Buffalo Tech..........2d 782 (Fed...... Apr.. 2004 U........S... Minn... 28 Allan Block Corp...... 2001) . 1993) ..... Boston Scientific Corp. 2d 696 (D......... Inc. 17 C....... Cir.. E................G. 2d 807 (N... Supp...... 1990) ... Supp... Dist....... Inc. No....... Inc................... 2004). 1990 U............ v...... 41 Boehringer Ingelheim Vetmedica............................. Ill.... 04-3511..3d 1340 (Fed... Research Org..... July 1..... LEXIS 14584 (D............. v.. v................. 6:89-1622-3.................. Cir......3d 1553 (Fed................ Boston Scientific Corp..... Genentech..... 852 F.................... No..R....S.. 269 F......... 80 F.3d 701 (Fed. Becton Dickinson Vascular Access.. Supp.S.. 157 F. Dist...S..... 17... v............ 2003)... LEXIS 13566 (D....D. Inc.. 2000) ....... 1983) . 34 Aptix Corp........ 39....................... 2007)....... Del..........D...........N.. Inc..........S. Inc............................ 21............... 41 Carl Schenek....... No........ 1998) ....... & Indus.... 28 iii ........ 1997) ..... Quickturn Design Sys.............. 40 ALM Surgical Equip... 2 Commonwealth Sci...... No.............. Inc. Minn. 93-108-JJF.. Cir......................... Inc.. 2005 U... Corp.. Inc....C..... LEXIS 11557 (Fed............... 2007) .... Inc....

........... Aug.... Dist..... Dist................ 21 eBay Inc............ Abbott Labs................................. Alaris Med............. 269 F..... v.... 2007 U.......... 22 ICU Med........................... 386 (1897)... WDQ-06-2711.........................S..... Inc......... 126 S.......................................S.............. 849 F................ 11 Hybritech Inc.........................3d 11 (1st Cir.......2d 873 (3d..D.. 18... 2007)... 4 U. 706 F.... 36 Dr.... Va. Inc.........2d 120 (3d Cir.............. 240 (1933)........ General Excavator Co.............. Sys........... July 30.....P.. Cal........ 1959) ................ 10.......... Ct.... Inc.............. Cal. v...... 1999) . Inc............... v.S.................... Del......... José S...... Premo Pharm....... 22 Johns Hopkins Univ.......... 1987). v.................3d 517 (3d Cir.......... Belaval.................. 17 Novozymes A/S v............. Datascope Corp.. Labs............. 2d 578 (D..................................................... Cir........... 630 F.................... 1987 WL 123997 (C.......... v.................S........... Cir.......... 2d (BNA) 1001..... Mellon.. Reinhard....................................... Nos.2d 1446 (Fed...... aff’d.... Perez-Perdomo..... 2007) ....... Datascope Corp........ 474 F................... Supp. 1988)...... 39... 10........... Md..... 2004) ........ 37................ Inc....... WDQ-05-0759............ Inc... 9...................... Cir....D............... v.... v............... 2004 U.C. 1989).. 181 F...................... duPont deNemours & Co. 2007) ................. Genencor Int’l............ Del....................... Md......... 2007).........L.... Polaroid Graphics Imaging............. 10.......Supp...... 9... 2007) ...........................I... 8 iv ................. 1988) ............ LEXIS 19949 (C................C....... 41 MercExchange...... eBay........ v... v.. 2d 556 (E......................... 36...........................2d 1446 (Fed................. Inc...... 1980) ....... 1135 (D........................................................... 165 U.S........... 37 Johns Hopkins Univ.................... 41 E.... 21 Gaudiosi v........ MercExchange.........Q.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 5 of 63 Deweese v...... 39.. 11 In re New Valley Corp.... L.................. 290 U....... 10.............. 1837 (2006).... v................................ 37 Hybritech Inc......... Abbott Labs................ Supp... 28 Keystone Driller Co............... 513 F.............. L............... 488 F........... 2d 592 (D. Supp. 500 F...... 8..L....................D... 849 F... LEXIS 68972 (D... v... 16 Eli Lilly & Co..

.................. 13.... 429 F... v........... 20 Sanofi-Synthelabo v........ May 24... Mossinghoff.... 10. Inc..........................N.... Osborne. 1983 U.... 813 (D..... 10......... Teva Pharms... 1990 U... 2d 317 (S........................... 1994)........ Feb............) 516 (1870)........ No..D...2d 985 (Fed...... May 11..S..Y. Inc.. Essex Group.... 10........................ InnovaSystems......................................... Hughes Tool Co...... 1983) ..3d 1368 (Fed.................. Bentley Labs. Supp.................... 525 U.................. Inc............ 34 Seymour v..D... 90-0242.... 806 (1945).............S.. 9........ 37 v ....... 601 F....... 18. Inc.....Y............. LEXIS 48475 (D... 55 (1998).......... 37.. 488 F.... Cir.....D... Co... 758 F........................ Supp. Inc... 21 Sanofi-Synthelabo v... 492 F......... Dist....... 9 Schneider (Eur........ Dist...S... 1985) .. No... 2d 978 (W........ 2007 U.................... Corp....... 2006) .... 28 Smith Int’l........... Apotex........ v.... 324 U.......... Inc........ 2d 353 (S.D... v.......... 21 Patlex Corp.... Corp............... 2007).......... 11.. Supp..........S... 1985) ......... 12... 39.. v.......... Reebok Int’l Ltd...... 10............3d 1364 (Fed... Ill... 2006) ......... 10..... 41 Proveris Sci... 28 Sanofi-Synthelabo v...... 998 F....S......... Inc. 10 Pfaff v.............D........... Pa..... 21 Payless Shoesource..... LEXIS 16724 (N............ Inc............................................ Co.... 18............. 78 U...2d 594 (Fed..... Cal................ Apotex... 964 (C.... 23....... (II Wall.......................... LEXIS 1951 (E.........Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 6 of 63 Ortho Pharm..... Inc... v................. Maint............................... 2007) .....)......... 19....................N... Inc. 466 F....... 718 F.) AG v.. Inc... v........................S. 1993) ... Mach. Cir. Synthes (U.............. 852 F.. Smith....D... Minn.... v.. 81 C 3313................ 19 Pfizer.... Inc... 20...... Cir.A.... 1983) .. 2005) . Wells Elecs.... Supp............... 19 Shiley..... Mass........ Dist............... Inc..... Apotex........... Cir..2d 1573 (Fed........ 28.... SciMed Life Sys... USA.... 2006) ........... 34 Smith & Nephew. 21 Precision Instrument Mfg... Supp................................................ 28...... No......... v.... Auto........... 470 F.S........... 1990) ................. 11.. 4.. Inc............................. v................................ 21 Southwire Co..... Cir. 05-12424-WGY........ v......... Tenn.........................

...2d 995 (Fed.............. Corp.................... Vonage Holdings Corp........................... Found..... 2006 U....... § 271(d)(3) (2007).....3d 1295 (Fed...... 1997) ..S...D............... I................... 503 F....................................... H-03-2910.....S..........................S................................ No........ 2006) ...... 178 (1933).................................. Dec..... v. 18 STATUTES 35 U. v... 146 F...................... v............ Cir.... Const................ 4 Verizon Servs...................2d 941 (9th Cir.......................Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 7 of 63 Transocean Offshore Deepwater Drilling.. 8 United States v........... 8........... v....C. Dist............. Cir............... Inc................................................................................ 44 35 U.............. 14 Virginia Panel Corp.. Inc.. MAC Panel Co........... 19 vi ........................ 2007) . Cir. 42 Vitamin Technologists.. GlobalSantaFe Corp.................. cl.. 1945) ........... Dubilier Condenser Corp................. Alumni Res.S..... 133 F..... 1986) ... 782 F......... LEXIS 93408 (S................ Wis.. § 8............... v............ 27........ 17...................................... Tex.......3d 860 (Fed............S. 44 Windsurfing Int’l Inc....... Inc............................................. 50 OTHER AUTHORITIES U........ art..........................................C.......................... § 284 (2007) ............................ AMF...... 289 U.....

in an attempt to conjure up some countervailing public interest. 1 . From Roche’s own marketing plans it was clear that peg-EPO’s initial price as well as its price three years after it enters will be significantly higher than what Medicare pays today for Amgen’s EPOGEN®. Although Roche talks of the great economic and public health benefits that its “new and different medicine” could bring. denial of an injunction in this case would greatly disserve that public interest.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 8 of 63 I. Rather. Likewise. Roche’s product is not some new and different molecule that meets some unmet medical need. the evidence at trial disproved any basis for these assertions. Whatever hardship Roche bears it brought on itself. Roche’s bold assertions of saving billions of dollars for the government and taxpayers are false as the evidence showed that Roche’s peg-EPO will actually increase the cost to Medicare for treating anemia in patients with chronic renal failure. In fact. INTRODUCTION The evidence introduced at trial in the remedy phase convincingly established that Amgen is entitled to an injunction to prevent Roche from importing. for it knew about Amgen’s proven patent rights before it began development of peg-EPO. Entry of an injunction will serve the public interest in upholding the basic premise of the patent system — to give the patent owner the right to exclude others from using the claimed inventions during the term of the patent. Roche’s product is EPO — the same EPO that Dr. As demonstrated in the results of Roche’s clinical trials. and selling any pegEPO product in the United States for the term of the four patents Roche was held to infringe. using. peg-EPO has no clinical benefit over Amgen’s products and is associated with a higher incidence of serious side effects. Lin invented and Amgen brought to patients around the world to treat their anemia — with the addition of a peg to it. There can be no doubt that Amgen will suffer irreparable injury for which monetary damages are inadequate to compensate and that the balance of hardships weighs in Amgen’s favor.

economy. the principle underlying the Patent Act is to promote the progress of science 1 Carl Schenek. On Amgen’s side. 2 . Lin’s inventions have dramatically improved and continue to improve the lives of hundreds of thousands of patients throughout the world.2d 782. Amgen conducted the clinical trials that supported FDA approval for EPOGEN and made this novel medicine available to anemic patients desperately in need of a treatment. If a patentee or licensee enjoys widespread sales. and research — all much to the benefit of the U. Lin’s patents are valid and enforceable. development. Cir. By every measure. the facts could not be more compelling in favor of an injunction. As the evidence demonstrated. courts. Dr. Dr. v. A. Lin’s pioneering inventions exemplify the patent system working at its best.” (emphasis added)).G. 1983) (“Disclosure of an invention found to have revolutionized an industry is but a classic example of the ideal working of the patent system. the Patent Office awarded Dr..Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 9 of 63 Roche’s recent proposal that would slightly lower peg-EPO’s initial price does nothing to change this result as the peg-EPO launch price (which would be the basis for its reimbursed price as a new entrant in the ASP system) would still be significantly higher than EPOGEN’s reimbursed price. sales. and now a jury. and enforcement of the legal rights protecting Dr. In recognition of his inventive contributions. distribution. quality control and assurance.S. Lin seven patents. 713 F. Nortron Corp. Amgen built a company around these inventions and created thousands of new jobs in manufacturing. 1 As provided in the Constitution. validation. the creation. that too is but an example of the incentive-useful arts promoting element in the patent system. 784 (Fed. have agreed that Dr. Lin invented and patented breakthrough recombinant human EPO products and processes for making them. These inventions and the legal protection afforded them under the patent system largely made possible Amgen’s success as an innovator in a highly valuable but risky industry. Time and again.

Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 10 of 63 and the useful arts by securing for limited times to inventors the exclusive right to their discoveries. but all similarly situated companies that invest heavily in research and development and rely on the patent system to protect that investment would have their business models threatened by the denial of an injunction in this case. Enforcing that exclusivity in the instant case serves to insure that the incentives as originally intended continue to remain in place so as to encourage individuals to make extraordinary sacrifices and brilliant advances — like those of Dr. Roche was well aware of its infringement and made a business decision to take the risk of 3 . then what patent owner would feel confident that its rights would be enforced? Roche can point to nothing to counter the great harm that will be caused to Amgen. And. The evidence presented at trial showed that Amgen’s core business of pursuing high risk research and innovation that propel the discovery and development of new therapeutic products. and Amgen’s customer relationships would be irretrievably damaged if a permanent injunction against Roche’s continued infringement were denied. Amgen’s very existence as an independent company could be threatened. And Roche brought on its own problems. Lin’s — as well as make available the significant risk and human capital required to make miracle products — like EPOGEN — available to the public. Failing to enforce such exclusivity here would seriously undermine the incentive structure of the patent system. the impact would not just be on Amgen. Long before the jury’s verdict and this Court’s judgment. The jobs built on these patented inventions could be lost. Amgen’s product revenues that sustain this discovery and development. If not in this case.

whose market entry would increase choice. Inc. Dubilier Condenser Corp. TX 67 (May 2001 Research and Development Committee Development Plan) at R10004305819 (providing that the risk of entering the U. 289 U. Roche went so far as to impugn Dr. 178.. United States v. 55.”)..” And. But Roche’s own documents show that the needs of patients. and their doctors.S. With all the sincerity of a snake-oil salesman. for it is not created by the executive authority at the expense and to the prejudice of all the community except the grantee of the patent. drive down prices. market anyway. accurately speaking. 3/22/07 Abercrombie Dep. and save the government and taxpayers billions of dollars. as it expressly stated. Roche’s true interest was See.. 4 3 2 4 . 63-64 (1998). 2 Indeed. market in light of Amgen’s patents was “justifiable”). at 32:24-33:2 (the Abercrombie deposition testimony cited herein was submitted to the Court by Amgen as remedy-related deposition designations on 12/14/07). it was developing and would launch its infringing product “at risk.S. 525 U. Roche hyped its infringing product as a purportedly “new” medicine conferring a different medical benefit. Roche went on to spin a tale of fanciful benefits that would befall the public if only it would close an eye to its theft.” 3 Desperate to deflect attention from its theft.S.g. e.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 11 of 63 pursuing the U. suffering from anemia associated with chronic renal failure are already satisfied by currently available ESAs and that its infringing product delivers at best “non-inferior” or “comparable” results. 4 Hardly the champion of public interest that it purports to be. Lin’s integrity and accomplishments by asserting he did not invent anything at all and that his patents served to give rise to an illegal “monopoly. a patent is not. Wells Elecs.S. a monopoly. Moreover. Pfaff v. its internal forecasts reveal a truth starkly different from its tale of lowering prices and reducing taxes — namely a scheme in which Roche will maintain a high price to the government in order to fund discounts and rebates which it intends to use in order to take share from Amgen.. 186 (1933) (“Though often so characterized. Tr.

Well. Because we’re not particularly interested in the after-patent generics market. J. the market share you want is the market share from the entry of my order. generics will be on the field in 2013. lest there be any doubt. at 562:9 (Senich) (admitting that all of Roche’s public interest arguments are subject to whether peg-EPO would “ultimately provide a return to the company. at 598:6-12 (Young. Senich). at 567:17-18 (Senich). you won’t come in anyway because the. 5 12/7/07 Remedy Hr’g Tr. at 683:19-24 (Young. Senich). Barbara Senich. As Roche’s Vice President of Marketing and Sales. at 598:6-12 (Young. we’re not going to see Mircera in the United States. that’s sort of an end of it in the United States. J. candidly conceded. marketplace if it can be assured that it can enjoy the financial benefits of Dr.) (“But here’s what I heard [Senich] say. 12/7/07 Remedy Hr’g Tr.”). the Court’s questioning made Roche’s true intent ever so clear: THE COURT: You’re telling me that if I enjoin and I’m upheld. 5 6 .S. and it has to be economically worthwhile to us.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 12 of 63 laid bare at trial. J. 5 And.. see also 12/7/07 Remedy Hr’g Tr. 12/7/07 Remedy Hr’g Tr. in order for us to enter into these negotiations. we’ll assume my orders are all upheld. see also 12/7/07 Remedy Hr’g Tr. at 597:18-20 (Senich). they have to be economically viable for Roche. 12/7/07 Remedy Hr’g Tr. We want to get into the market which is protected by valid and upheld Amgen patents.”). Have I got that right? THE WITNESS: Pretty much.. to 2013. Lin’s exclusivity rights: I don’t believe [Roche] would enter the market at all if the value were only after generics came into the marketplace. But Roche’s recent proposal adds nothing new and cannot be considered a serious proposal because the royalty is grossly inadequate to compensate Amgen for Roche’s infringement and it still results in peg-EPO having a higher price to the government by up to 45% than Amgen’s EPOGEN. 6 The only thing more astonishing than Roche’s false assertions of its public interests is its chutzpah now in proposing that the Court order a license at a royalty rate of 20%. But you’re also telling me that if I let you into the market but make it so uneconomic. despite its yarn about making available to patients a “new” medicine and saving billions in tax dollars. Roche is only interested in entering the U. We want a piece of that market.

Senich testified Roche insists upon for it to come into the marketplace. merely collects a royalty. Rather. which would account for any savings. Besides exposing themselves to willful infringement and treble damages. The legal precedent fully supports the entry of an injunction in this case. Roche still would enjoy the profits Ms. Roche’s disdain for the jury verdict and the decisions of this Court only serve to reinforce the need for an injunction to stop Roche’s attempts to irreparably harm Amgen. in lieu of practicing the inventions or selling a patented product in the market. Amgen faces both the risk of market share and price erosion resulting in further injury to Amgen not compensated for by the payment of royalties on Roche’s sales. ironically it would be the price reductions (and lower profit) of Amgen. would result from what amounts to an unfair and inappropriate taking of property rightfully belonging to the party who took all the risk and devoted all the resources needed to create the market opportunity in the first place. The factual paradigm presented the Court in the instant case is not one in which the patentee. not Roche.S.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 13 of 63 Indeed. the proposal seems more intended to deliver the message that despite the jury verdict and the Court’s decisions that Roche intends to launch peg-EPO in the U. the patent innovator. If Roche’s economic incentives produce a precipitous shift for EPOGEN to peg-EPO. Roche’s profits and Amgen’s loss. Roche’s recent proposal would compensate Amgen only about 20 cents for every dollar of Amgen lost sales. next month. There is no court decision post eBay that would support the denial of an injunction. Even if the Court assumes that Roche’s future infringement of Amgen’s patents would reduce the total cost of EPO therapy (an assumption that Roche’s own evidence disproves). this is a case in which the patentee not only invented and commercially developed the pioneering inventions into a blockbuster product but also literally created the market by means of its 6 .

Amgen respectfully submits that the Court should permanently enjoin Roche against any future infringement of Amgen’s patents in accordance with the jury’s verdict and this Court’s prior rulings. Roche’s recent proposal changes nothing from his analysis and conclusions presented at trial. In one fell swoop. Thus. and then have the courts revise the patentees’ rights. The paradigm here involves a demand by an infringer that its infringing product be allowed to take sales away from the patentee’s product in return for a royalty rate that will not fully compensate the patentee for the profits it would have received from the sales of its own patented product. Bernheim’s declaration (submitted herewith) details. failing to grant injunctive relief here would broadcast a signal to all would-be infringers to flat out copy the few patented products that are proven successes. Indeed. The evidence fully confirms the need for an injunction in this case. much less compensate it for all of the other irreparable harm it would suffer as a result of the government reneging on the promise of exclusivity it made in granting the patents in the first place. But the point of patents is exclusivity and the point of injunctive relief is deterrence. Roche asks this Court to legislate an end to all of that.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 14 of 63 inventions. There is no precedent for such relief. As Dr. and certainly none fitting the facts of this case. 7 .

a remedy in equity is warranted. a vast majority of courts have confirmed that a permanent injunction is the appropriate relief for a patent holder against a patent infringer in the 7 Amgen refers the Court to its 11/21/07 Mem. This Brief summarizes the facts set forth therein and adds additional evidence adduced during the remainder of the Remedy Hearing on December 5-7. 8 . 2007 Remedy Hearing as it applies to the four injunction factors. both through its own witnesses as well as from Roche witnesses. The evidence of record leaves little doubt that Roche’s infringement will cause irreparable injury to Amgen. which demonstrated that the four-factor test set forth by the Supreme Court in eBay Inc. (3) that. (D. AMGEN PROVED AT TRIAL THAT A PERMANENT INJUNCTION SHOULD BE ENTERED BECAUSE THE FOUR FACTORS WEIGH HEAVILY IN FAVOR OF AN INJUNCTION.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 15 of 63 II. Amgen submitted evidence. At the remedy trial. 1578) (hereinafter Amgen’s Inj. Specifically. Amgen has demonstrated: (1) that it has suffered an irreparable injury. MercExchange. L. of Amgen’s Req. such as monetary damages. considering the balance of hardships between the [parties].. OVERVIEW OF THE EVIDENCE AND LEGAL STANDARD.N. in Supp. v.L. Because Amgen markets EPOGEN for use in dialysis patients — one of the main indications for which Roche’s peg-EPO product was approved — every sale by Roche is a lost sale to Amgen. 2007 and any exhibits admitted thereafter by the Court. Applying the eBay standard. and (4) that the public interest would not be disserved by a permanent injunction. 7 A. and that the balance of harm tips heavily in Amgen’s direction.). Amgen has developed a market that Roche now seeks to misappropriate for itself while offering only a nominal royalty.C. 8 As the innovator of a product that has proven to be hugely beneficial to patients. weighs decidedly in favor of an injunction. Mem. for a Permanent Inj. setting forth the evidence presented through the November 15. (2) that remedies available at law. that monetary damages are inadequate to compensate for the injury. are inadequate to compensate for that injury.

Rather. Synthes (U. Dec... e.g. LEXIS 93408. Roche focused on the public interest factor as the justification for avoiding an injunction citing purported public health and economic benefits of its infringing product. 492 F. 1839 (2006). Supp. 10 See. 10 In its briefing and at trial. and the patented invention is not an inconsequential component of the infringing product. the infringer usurps the core functionality and commercial appeal of the patented invention. MercExchange. the infringer’s product would directly compete for sales with the patentee’s own products. 2006) (medical). Sanofi-Synthelabo v. GlobalSantaFe Corp. See. Courts routinely find that the traditional four-factor test is met and grant injunctive relief where the patent-holder practices its invention. 2007) (pharmaceutical). Ct. Inc.C. v.Y. v. but in fact. Supp. Inc. Inc. Supp. Transocean Offshore Deepwater Drilling. 466 F. Tex.D. Del. 126 S. L. 9 . Inc. No. and take on added weight where the patented inventions are pioneering breakthroughs.D.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 16 of 63 circumstances presented here. 2d 353. Dist.D.L. Roche’s peg-EPO provides no clinical or medical benefit and will actually cost more than Amgen’s EPOGEN.A. e. Apotex. 474 F. Roche’s assertions that peg-EPO meets the market need for an extended dosing product ignores the evidence that both Amgen’s Aranesp and Ortho’s Procrit are routinely used at dosing intervals up to once a month. 1837. 27. 2006).. 2d 978 (W. 2d 592. Tenn. Although wrong in its positions. 2007).. at *12 (S. neither of those reasons has been recognized as a justification for denying an injunction and allowing an infringer on the market.N. H-03-2910.g.S. 9 These principles apply with equal force in the context of medical and pharmaceutical patents. Roche ignores the most significant public interest factor: the strong public interest in enforcing patent 8 9 eBay Inc.). As demonstrated.S.. Roche acts as if the only public interests were treatment costs and patient convenience. 397-98 (S. 2006 U. Genencor Int’l. Smith & Nephew. 612 (D.. But the evidence at trial disproved a claim of such benefits. v. Novozymes A/S v.

12 13 14 11 eBay. 2005). 998 F.. Research Org. Inc. v. 492 F. Supp. Apotex. 2006).3d 1364.2d 120. v. an infringer” from practicing the patent “against the patentee’s wishes. 607 (E. Cir. Cir.. Inc. 630 F. Ct. the fact that Sanofi-Synthelabo v. eBay. 2d 600.. Cir. Only under “rare and limited circumstances” 14 has an injunction been denied on public interest grounds — such as where there is some “critical public interest that would be injured” by the grant of an injunction. or (4) a business method patent of suspect validity is asserted. Teva Pharms. L. Commonwealth Sci. Tex. 16 Likewise. Justice Kennedy cautioned that damages may be a sufficient remedy without an injunction only in limited situations. v.”). 15 Allegedly promoting competition and lowering prices at the cost of destroying the property of another is not such a critical public interest.). Abbott Labs. at 1841 (Roberts. 138 (3d Cir. 849 F. 500 F.. MercExchange.. 488 F. see also Eli Lilly & Co.. Supp. Inc. 126 S. Reebok Int’l Ltd. v.”).” 12 Further. JJ. Supp.. 1980) (“Congress has determined that it is better for the nation in the long-run to afford the inventors of novel. Premo Pharm.D. useful. Payless Shoesource. 2007). See Pfizer. 13 None of these factors are present in this case. Inc. v. 1382 (Fed. USA. 1988). Souter. at 1842 (Kennedy..2d 985.D. 11 This interest resulted in courts routinely issuing injunctions in patent cases for over 200 years..2d 1446. Inc. 429 F.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 17 of 63 rights.” in that the fundamental right of a patent holder is “a right to exclude . joined by Scalia and Ginsburg. & Indus. Inc. 2d 556. 15 16 Hybritech Inc. JJ. As Justice Roberts noted in his concurring opinion in eBay: “This ‘long tradition of equity practice’” in the “vast majority of patent cases” is “not surprising. J. 470 F. concurring. 2007). 1458 (Fed.).L. and nonobvious products short-term monopolies on such products than it is to permit free competition in such goods. 2006) (“[T]he public interest in lower-priced drugs is balanced by a significant public interest in encouraging the massive investment in 10 . 1383-84 (Fed. joined by Stevens.Y. J. (2) a patent covers only a small component of the infringing product.C. concurring. Va. Buffalo Tech.. (3) the patentee uses the threat of an injunction for negotiation leverage. 991 (Fed. 586 (E. Inc. such as where: (1) a patentee is primarily concerned with licensing. 1993) (“Selling a lower priced product does not justify infringing a patent. v. Cir. . 345 (S. 2d 317. and Bryer. SanofiSynthelabo.N.3d 1368. Id. Labs.D. .

See. 20 Hybritech Inc. 19 (3) no treatment alternatives are available. 849 F..). 19 18 17 Shiley. Synthes (U. Abbott Labs. LEXIS 68972 (D. 2003 U. Mass. Inc. 9. Inc. at 964 (finding short-term supply problems). v. SciMed Life Sys. Del. 2d (BNA) 1001. Md. No. Dist. aff’d. InnovaSystems. LEXIS 19959 (D.S. Aug. v. 1015.S. 2007) (permanently enjoining treatments for fragmenting clots within hemodialysis grafts).. courts have denied an injunction for a limited set of public health reasons — but none are analogous to the facts of this case. 6:89-1622-3. 2007 U. Those limited circumstances include where: (1) the patentee cannot ensure adequate supply to the public. No.S.S. 05-12424-WGY.. 21. 23. 601 F. Inc. Kirschner Med. Shiley. Johns Hopkins Univ. WDQ-06-2711. Inc.. injunctions have been granted where there the public will have an adequate supply of the patented medical device or therapy.. Tenn. 2006) (permanently enjoining use of intramedullary nails and methods to treat femoral fractures).Q.2d 1446 (Fed. 1990 U. Supp.C. 813 (D. 2007 U. 1988) (excluding cancer patients from the effects of a preliminary injunction because the court “will not cut off the supply of monoclonal test kits for 11 .. 852 F.S.D. LEXIS 48475 (D.. Inc. 4 U. Supp. In contrast. Cordis Corp. Supp.A.Y. Datascope Corp. Boston Scientific Corp. ALM Surgical Equip.N.D. Dist.. v. 601 F.P.. 93-108-JJF.) AG v.g. Nov. Bentley Labs. 1987 WL 123997 (C. v. Inc.. Cal. May 11.g. Smith & Nephew.S. 1985) (permanently enjoining bubble blood oxygenator for use in open heart surgery). July 16. Corp. v.. Inc.”). No. 1990 U. Corp. See. v. as argued by Roche. 17 In a few cases. e. Minn. Supp.D. 03-238. 466 F.D. Del. 20 or (4) there are research and development that is required before a new drug can be developed and brought to market. 1993 U. LEXIS 14584 (D. Apr. 492 F. 2d 978 (W. 964 (C. 601 F. 2d 353 (S. Dist. Dist..S.S. 2007) (permanently enjoining solutions that increased the accuracy of the testing of pharmaceutical spray drug products). Nos. 1987). Shiley. Critikon. 964 (staying injunction to provide efficient and non-disruptive changeover for practitioners due to lag time in training staff). Supp. 2003) (finding patentee could not ensure an adequate supply of drug-eluting stents).. 1990) (permanently enjoining use of prismatic surgical light system). Inc. Becton Dickinson Vascular Access. SanofiSynthelabo v. Dist. Cal. WDQ-05-0759. ALM. 2007) (permanently enjoining generic platelet aggregation-inhibiting agent). v. Proveris Sci. e. Dist.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 18 of 63 an injunction might affect medical treatments or tests or denied medicines to patients. LEXIS 14584. 18 (2) there is lag-time in training of medical staff or other interruption of medical care. LEXIS 21338 (D. No. Apotex.. Supp. 1994) (permanently enjoining balloon dilation catheter for treating coronary heart disease). Inc. at *52 (finding there would be “no delay in supplying prismatic surgical lights to the public”). v. 1993) (preliminarily enjoining safety catheters designed to eliminate risk to healthcare professionals of accidental exposure to AIDS). Schneider (Eur. Cir. have not been recognized as reasons to deny injunctions.S.

Supp. 23 To successfully innovate and compete. 1578) at 13-14. are granted where the infringing product is not superior or has similar safety issues associated with the patented invention. the purported medical and economic benefits are simply not the type of sufficient public interests to justify denial of an injunction. July 30..P. at 970 (granting injunction where infringing catheter was not “objectively superior in performance or that either is defective or unsafe in any way or does not properly perform as intended and required in the operating room”). ICU Med.S. e. See. Sanofi-Synthelabo v. there must be sufficient protection for those products that succeed. and selling of medicines based on the company’s innovations. unsafe. 2d (BNA) at 1015 (denying preliminary injunction against hepatitis test kits because “the public interest is served by the availability of safe. 21 Even if Roche’s claimed product benefits were true. Schneider. (D. 23 Amgen’s Inj. at 26:11-21 (Sharer). Dist. 22 Research and development of these medicines are extremely risky and expensive. 2004) (denying preliminary injunction where needleless valves would be suddenly absent from the marketplace). Mem.. 22 21 11/15/07 Remedy Hr’g Tr. at 34:12-19. or incapable of performing as intended”). however. Amgen’s business is based on innovation and the development. Hybritech. Alaris Med. Inc. Amgen is not in the business of licensing its inventions to its competitors. marketing. v. Supp. Amgen has consistently taken the revenues from its successful products and reinvested them into discovery and clinical research.N.. Injunctions. Sharer also noted. 601 F. 35:11-20 (Sharer). at 851 (granting injunction where infringing catheter was not “significantly objectively superior to other catheters in performance or that all other catheters are defective.. Inc. 2004 U. 25 Thus. Cir.S. Inc. 852 F. At its core.Q. Sys. at 76:3-77:12 (Sharer). 470 F. 1383 (Fed.g. to attract investors to continue to invest in Amgen. Apotex. 4 U. LEXIS 19949 (C.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 19 of 63 significant safety issues associated with the patented invention not present in the infringing product. B. Cal. Shiley. 11/15/07 Remedy Hr’g Tr. with few products ever successfully developed and marketed.3d 1368. 2006). as cancer patients”). 24 25 12 . which they are not.D. 24 To continue with this model. sure reliable tests kits for hepatitis”). AMGEN WILL SUFFER FROM IRREPARABLE INJURY UNLESS A PERMANENT INJUNCTION IS GRANTED. Id. As Mr. and as a corollary. 11/15/07 Remedy Hr’g Tr. at 28:9-19.

Amgen will suffer irreparable injuries to its customer relationships. investors would be reluctant to invest in Amgen due to fear that the patent system would fail to protect their investments and Amgen’s way of doing business would be irreparably harmed. 13 . 28 27 Amgen’s Inj. likely requiring a reduction in its workforce. at 29:7-30:11. (D. 1578) at 8-9.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 20 of 63 Amgen’s Chief Executive Officer testified. 27 as well as a shift in how resources (in terms of personnel and money) are applied to research and product development. ¶ 19.g. 29 See. if a party found to infringe a patent was allowed to enter the market for some fee. e. See Sanofi-Synthelabo. RTX 119 (MIRCERA Pricing and Contracting Recommendation) at R003907912. 1578) at 8.N. 11/15/07 Remedy Hr’g Tr. including dialysis providers.. Mem.N. 2/15/08 Bernheim Decl. at 30:23-24 (Sharer). e. 30 See. 32:16-33:10 (Sharer) (testifying that if the security provided by the patent system is removed. Mem. 26 In addition to inexorably changing Amgen’s business model. the risk of investing will no longer be worthwhile).g. 29 As its documents show.. 11/15/07 Remedy Hr’g Tr. 28 Similarly. RTX 100 (MIRCERA Business Plan 2007) at R003905826. RTX 119 (MIRCERA Pricing and Contracting Recommendation) at R003907912. Amgen’s Inj. Amgen’s business operations would be dramatically altered. Amgen would suffer an immediate drop in revenue because every Roche sale in dialysis is a lost sale to Amgen. (D. (D. MIRCERA. since Roche has frequently stated its goal of disrupting customer satisfaction with current ESAs to sell its pegylated EPO product. 470 F. 1578) at 9. 11/15/07 Remedy Hr’g Tr. Roche repeatedly has attempted to harm the reputation of Amgen’s products.3d at 1382-83 (noting potential reduction in workforce as a factor in establishing irreparable harm).N. if Roche were allowed to commercialize pre-EPO in the United States. Mem. RTX 100 (MIRCERA Business Plan 2007) at R003905826. at 38:9-39:3 (Sharer). Roche’s potential market entry will also have the effect of stifling Amgen’s further innovation in the 26 Amgen’s Inj.30 In addition to impairing Amgen’s research and development on a broader scale.

¶¶ 18-19. Roche expects that some dialysis providers immediately will begin switching to pegEPO and this will necessarily result in a lowering of Amgen’s ASP over time (even if Amgen does not change its pricing) because of rebate and discount overhang. 28. 2007) (finding price erosion to be an area of irreparable harm). at 196:24-197:5 (Bernheim). See Verizon Servs. Roche will be in a better position than it would have been had it not marketed peg-EPO as an infringer. Roche’s entry may also result in some price erosion. Vonage Holdings Corp. and would represent further irreparable harm to Amgen to the extent that it does occur. in addition to market share loses. 31 For example. 34 In the short-term.3d 1295. such opportunities will also be lost and Amgen’s ability to innovate stifled. 11/15/07 Remedy Hr’g Tr. But if Amgen loses the customer relationships built on the basis of its patented product to Roche’s infringing product. Corp. Id. at 196:24-197:5 (Bernheim). Amgen will 31 32 11/15/07 Remedy Hr’g Tr. 36 On the other hand. Cir. 33 Such information and opportunities spur innovation. 32. Id. Finally. 1310 (Fed. at FMCNA000010-11.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 21 of 63 treatment of kidney patients with anemia. at 178:21-188:6 (Bernheim). placing Roche in a position to take even more sales away from Amgen. Amgen’s agreement with Fresenius affords Amgen access to important medical and market information and data 32 and lays out plans to develop new products and engage in joint research for better inventory management. the evidence shows that because of economic considerations (to increase profits). RTX 20 (Sourcing and Supply Agreement between Amgen and Fresenius) at FMCNA000010. v. 503 F. 2/15/08 Bernheim Decl. 37 To the extent that such erosion occurs. 25. but when its patents expire it will be in a worse position than it would have been had Roche not infringed. 35 36 37 14 . not only will Amgen lose revenue now. at 191:10-192:3 (Bernheim). when Amgen’s patents expire.. 35 The long-term effect of this price erosion is especially harmful since. 33 34 Id.

at 127:5-24 (“[A]s a practical matter in patent damages cases. Mem.N. as evidenced by Roche’s own internal 38 39 Amgen’s Inj. .”) (the Schwartz deposition testimony cited herein was submitted to the Court by Amgen as remedyrelated deposition designations on 12/14/07). No amount of money damages can repay Amgen for the damage to its reputation. .Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 22 of 63 be irreparably harmed. the loss of investor confidence. I think that’s almost a given. Steven Schwartz. C. For example. 6/7/07 Schwartz Dep. The evidence shows that no prospective damages award would be adequate compensation for Roche’s infringement. a patent holder cannot be made whole for the effects of infringement by a royalty. 1578) at 10. 39 This is in part because it is impossible to know prospectively the extent that Amgen will be damaged. when a reasonable royalty is awarded. 38 Thus. (D. . acknowledges. Tr. In a royalty situation. 41 40 See id. 15 . at 237:17-238:2 (noting Roche’s net sales projections for 2007 vary from $49 million to $113 million). that royalty may not fully compensate the patent holder for the effects of infringement. See id. It’s almost a tautology that the patent holder may not be made whole for the effects of infringement. 40 Likewise. as even Dr. A simple transfer of profits would not make up for Roche displacing Amgen in the marketplace. or the loss of further research opportunities. at 102:22-103:4. there is no way to know how Roche’s entry will affect the price for ESAs. Roche’s own economics expert. REMEDIES AVAILABLE AT LAW ARE INADEQUATE TO COMPENSATE FOR AMGEN’S IRREPARABLE INJURY. 41 While Roche argues that prices may decrease as the parties compete for share. it is impossible to know how much share Roche may capture — Roche’s own estimations vary by more than 100% among its different scenarios. Even if Roche were ordered to pay Amgen all of Amgen’s lost profits on the sales made by Roche. the award would be inadequate.

As demonstrated above. 43 Finally. Tr.L. the effect of an eroding price (and the rebate overhang) on Amgen’s ASP cannot be calculated. concurring). e. 126 S. Amgen’s damages cannot be quantified with any reasonable certainty because actual price (including dose conversion. As Justice Kennedy noted in eBay. 1842 (2006) (Kennedy. 46 45 44 eBay Inc. discounts and rebates) and market share cannot be accurately predicted. L.5% increase in price every six months. at 102:22-103:21. RTX 5 (4/6/07 Bernheim Report) ¶ 66. damages may be sufficient remedy for infringement in place of an injunction in only such cases as where the patentee is not in the market itself but has licensed the invention to multiple parties or the invention is but a small part of a larger product. at 585:14-22 (Senich) (testifying that Roche anticipates changes to the regulatory framework in 2010). Tr. 11/5/07 Remedy Hr’g Tr. RTX 131 (2007 MIRCERA Business Plan) at R11-000638012. future events such as the entry of new competitive products 44 or changes in the Centers for Medicare and Medicaid Services’ (CMS) regulations 45 cannot be predicted with any reasonable certainty and thus any impact Roche’s entry could have on such events is incalculable. and in turn. MercExchange. 1837.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 23 of 63 documents. v..C. Ct. 16 . 188:8-18 (Bernheim).. 6/7/07 Schwartz Dep. 42 In either event. 43 See RTX 130 (2007 MIRCERA Business Plan) at R10-001303069 (Roche expects new noninfringing product on the market in 2010). J.. at 181:18-182:22. prices could just as easily rise upon Roche’s entry. 187:12-190:7. those are not the circumstances here. the patentee is made whole by the grant of a reasonable royalty in place of an injunction. 42 Roche’s 2007 Business Plan lays out an expected 1. 12/07/07 Remedy Hr’g.g. See. 46 In such cases.

50 Roche knowingly sought to enter the market despite Dr. Cir. 04-1098. v. because Roche elected to “build a business on a product found to infringe.D.L. 708 (Fed. Lin’s Patents. at *12 (Fed. Tr. the balance clearly weighs in Amgen’s favor. e.”). Inc. 17 .2d 995. 47 When Amgen’s and Roche’s hardships are compared. almost half of Amgen’s total pharmaceutical sales come from EPOGEN and Aranesp 49 and these sales will be at risk if Roche is permitted to commercialize peg-EPO in the U. 500 F. App. Supp 2d 556.g. Co. 49 50 See RTX 67 (Amgen 10-Q filing) at 26. THE BALANCE OF HARDSHIPS WEIGHS IN AMGEN’S FAVOR. L. Roche’s CEO George Abercrombie said that Roche would continue to proceed 47 48 Id.S. After litigation ensued. Va. Roche attempts to introduce testimony regarding the “harms” that Roche will suffer if an injunction is granted. 2004) (unpublished) (“[R]elative market effects may factor into balancing the relative hardships. No. 2004 U. v. May 28. Prods. eBay.C. Cordis Corp. First.. Inc.S. MercExchange. 132 F. 584 (E. Roche does not stand to lose any market share and its current sales will be unaffected because it does not sell peg-EPO in the United States. 48 Amgen has a large share of sales for the treatment of anemia associated with chronic renal failure. The third prong of the four-factor test considers the balance of the relative hardships. 2007) (citing Windsurfing Int’l Inc. the parties’ relative market effects should be considered. See generally 3/15/07 Kokino Dep. See. Altek Sys. AMF. Unlike Amgen.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 24 of 63 D. 782 F. 1986)). Through its designations. 1003 (Fed. (the Kokino deposition testimony cited herein was submitted to the Court by Roche as remedy-related deposition designations on 12/14/07). 1997) (considering the relative impact on both parties in balancing the relative hardships).. in balancing the hardships. LEXIS 11557. at 1839 (majority opinion). v. v. Second.. Cir. Additionally.. Boston Scientific Corp.” any purported harm to Roche is self-inflicted and should not serve as a basis for denying Amgen an injunction. Cir.3d 701. Bell & Howell Document Mgmt.

1986))). Moreover. at 32:24-33:2. If every infringer could use this argument. “at risk.D.N. v.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 25 of 63 to the market. should not serve to shift the balance. in Opp’n to Amgen’s Req. & Indus. 51 52 3/22/07 Abercrombie Dep. for a Permanent Inj.S.2d at 1003.” Roche has previously claimed that it will suffer harm to its reputation because it has promised to launch peg-EPO and failure to do so will cause skepticism towards Roche and any new Roche product entry. 606 (E. 2d 696. thus mitigating Roche’s alleged harm.”). 52 Furthermore. Mem. Roche’s clinical trials supported both U.S. it is unlikely that it will suffer any damage to its reputation except the loss of face suffered by an infringer who sought to launch by its own admission “at risk.S. regulatory approval and undertake steps needed to sell peg-EPO in the U. Supp. as it threatens to do in its January 28 Proposal by launching peg-EPO in the United States despite the jury’s verdict. 2d 600. Tr. 53 Since Roche is not yet selling ESAs in the U.. “one who elects to build a business on a product found to infringe cannot be heard to complain if an injunction against continuing infringement destroys the business so elected” (quoting Windsurfing.’ Mem. 782 F. (D. Finally. 18 . market in light of Amgen’s patents was “justifiable”). 1589) at 42 [hereinafter Roche’s Opp’n to Amgen’s Inj. 54 Roche’s argument that it should be allowed to infringe because it has promised that it will infringe fails to hold water. n. Schering-Plough Corp. and overseas registrations.J. 106 F..S. See also TX 67 (May 2001 Research and Development Committee Development Plan) at R10-004305819 (providing that the risk of entering the U. 707 (D. Tex. See Boehringer Ingelheim Vetmedica. 51 After having made the business decision to seek U..12 (Fed.N. Research Org.S.].” any harm incurred now that it must cease its activities does not outweigh Amgen’s harm. Inc. Cir. See Commonwealth Sci. Buffalo Tech. Supp. 2007) (“Mere hardship incurred in the process of ceasing operations is not sufficient. Inc. any attempt by Roche to “better” its situation. the patent laws would be meaningless. 2000) (finding that despite any harm to the infringer’s reputation as a result of an injunction. 492 F. 54 53 See Defs. damage to Roche’s reputation if it is not allowed to infringe Amgen’s products is not a cognizable hardship. v.

S.. Osborne.. 138 (3d Cir. e. Const. 1980). art. v. Sanofi-Synthelabo. Lab. for the limited term therein mentioned. as contemplated by the Constitution and sanctioned by the laws of Congress.g. Inc.2d 120. 56 [Patents are to be regarded] as public franchises granted to the inventors of new and useful improvements for the purpose of securing to them.”). Inc. 533534 (1870).. 63 (1998). Wells Elecs.. 630 F.. 2006) (“[T]he patent system provides incentive to the innovative drug companies to continue costly development efforts. 8 (directing Congress to “promote the Progress of Science” by granting inventors exclusivity).S. courts consistently grant injunctive relief in medical product cases because the public’s short-term interest in choice is outweighed by its long-term interest in promoting the development of new and potentially life-saving products. Premo Pharm. The public interest is best served by a result that honors a robust and predictable patent system that rewards innovation. Amgen is an innovation company and it operates on the riskiest and most costly edge of 55 56 Buffalo Tech. 525 U. I. at 63-64 (quoting Seymour v. Pfaff v. Cir. the exclusive right and liberty to make and use and vend to others to be used their own inventions. cl. and expense in making the inventions. (11 Wall. Sanofi-Synthelabo v. Eli Lilly & Co. 58 This bargain is at the core of the modern biotechnological and pharmaceutical arts.3d 1368. as tending to promote the progress of science and the useful arts.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 26 of 63 E. § 8. 57 58 19 .. and reducing the same to practice for the public benefit. THE PUBLIC INTEREST WOULD NOT BE DISSERVED BY AN INJUNCTION.S.S. and as matter of compensation to the inventors for their labor. Pfaff. 1. 470 F. Apotex. At the core of the Patent Act is the public interest in promoting innovation and the progress of science and the useful arts. 525 U. 470 F. see also U.. Supp. 1383 (Fed. toil. Inc.) 516. 55 The patent system represents a carefully crafted bargain that advocates both the creation and the public disclosure of new and useful advances in technology. 492 F. in exchange for an exclusive monopoly for a limited period of time. 3d at 1383. 55. 78 U. 57 Thus. 2d at 607. See. as such inventors.

“[p]atents are central to Amgen’s business.” 59 Kevin Sharer. companies such as Eli Lilly might well choose not to undertake such large expenditures and instead devote themselves to other endeavors.. . 846 (N.3d at 1383 (noting that the “average cost of developing a blockbuster drug is $800 million”). 2007). at 30:4-11 (Sharer). Amgen increased its research and development budget in 2006 by 45% to $3. if we’re able to make the advances we hope to. As such. will be protected and rewarded. RTX 55 (Amgen 10-K filing at 29.D. Patents allow us to go to investors and say your investment dollars. . Sandoz.. [T]he development and perfection of new drugs frequently requires the devotion of years of research time and the expenditure of millions of dollars. in 2007. 2d 807. RTX 10 (Amgen 10-Q filing) at 56. 61 Courts continue to acknowledge the immense cost involved in this process. Without patents. To the extent this occurs. Unless this type of an investment of human and capital resources is rewarded by some form of patent protection. 470 F. Patents allow us to have confidence that if we bring an innovation to market that we’ll be able to practice that. Supp. at 30:4 (Sharer). Id. Amgen’s Chairman and CEO.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 27 of 63 innovation. v. . 500 F. 630 F. Ill. 20 . 62 Today. at 29:11-15 (Sharer). it 59 60 11/15/07 Remedy Hr’g Tr. resources would be diverted from activity that is socially beneficial — the development of new drugs. 60 Nowhere is the public interest in protecting the rights of patent holders and enforcing adequate remedies for patent infringement more critical than in the development of biological pharmaceuticals. Premo Pharm. here. 61 62 Abbott Lab.2d at 137 (emphasis added).36 billion. Sanofi-Synthelabo. see also id. our business model just falls apart. Inc. 63 Not surprisingly. testified that Amgen’s success depends in part on its ability to obtain and defend intellectual property rights crucial to the commercialization of Amgen’s products and product candidates: Patents make the investment we make in research and development and innovation justified. it takes approximately $1 billion and 15 years to develop a single drug.

”). RTX 68 (Tr. Cir. In fact. anchor the entire business model. 65 But sustained long-term development of drugs requires more than resources. RTX 55 (Amgen 10-K filing) at 37 (“Product candidates that appear promising the early phases of development . we invest in don’t reach market. Amgen has had over 100 products close to or actually in human testing. 11/15/07 Remedy Hr’g Tr. 64 65 66 See id. at 35:11-20 (Sharer). . our business model just falls apart. .3d 1368 (Fed. at 30:11 (Sharer) (“Without patents. aff’d. 11/15/07 Remedy Hr’g Tr. but only six have successfully made it to market. at 35:4-7 (Sharer). Sanofi-Synthelabo. 66 Patents. therefore.”). RTX 1 (Amgen 2006 Annual Report) at 28. “for every drug that does make it to market many others do not”). Supp. . So it’s the winners have to pay for the losers. . Amgen’s research and development costs have tripled since 2002. 67 68 See id. 70 69 See 11/15/07 Remedy Hr’g Tr. at 27:19-28:8 (Sharer). 67 Nor is it guaranteed that an investment of $1 billion and 15 years will produce a commercial medicine. 35:4-20 (Sharer). . unfortunately. at 27:1-28:19. It requires an incentive for these resources to be systematically reinvested.”). at 35:8-10 (Sharer). 69 That these therapies appeared promising and progressed successfully through preclinical and earlier clinical trials speaks to the inherently unpredictable nature of modern drug discovery. See id. 21 . at 77:10-12 (Sharer) (“So it’s the winners have to pay for the losers. since 2000. 68 For example. . 488 F.”).Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 28 of 63 invested 24% of its annual revenues in research and development. 2d at 346 (noting that despite the average cost of $800 million to bring a drug to market. may fail to reach the market for a number of reasons. at 27:4-11 (Sharer). the likelihood of any single product making it from research to market is very small. 470 F. at 77:6-10 (Sharer) (“Most of the things we invest in do not work. 70 63 11/15/07 Remedy Hr’g Tr. . And most of the things. 2006). 64 Since 2000. 11/15/07 Remedy Hr’g Tr. Amgen has invested $15 billion in research and development. of Sharer and Dolan of Forbes Magazine) at 9. . See id.

1146 (D. Del. 718 F. 1382 (Fed. 2d at 346. duPont deNemours & Co. path-breaking therapeutics rests on the promise that future competitors will be excluded from practicing those inventions without the patentee’s permission. Dist. 73 However. No. 1990 U. Polaroid Graphics Imaging. If patent infringers.. and undermines virtually every role that the patent system plays in encouraging modern drug discovery. A denial of a permanent injunction would promote the exact opposite incentives by undermining “the public interest in creating beneficial Pfizer. And patients with unmet medical needs and no alternatives will be ignored in favor of offering patients choice between two or more products that already meet their medical needs. Smith Int’l.2d 1573. Roche argues that Amgen “already has made profits” in excess of the amount it originally invested in EPOGEN. 1990) (“If a patent holder cannot rely on its patent to exclude others then ‘research and development budgets in the science and technology based industries would shrink. Roche’s myopic argument ignores. resulting in the public no longer benefiting from the labors of these talented people. 706 F.. LEXIS 1951. Lab. breakthrough therapies. Cir. (D. 22 .N.2d 120. Mossinghoff. Sanofi-Synthelabo. 1985). In the face of this extreme risk and long-term competition. 1989)). Supp. Inc.D. v. 23.2d 594. Feb. Inc. Teva Pharms. there would be no reason or incentive for companies such as Amgen to continue to fund the huge investment and incur the enormous risk required to discover and develop new. Supp. 1589) at 4-5. 1980). 137 (3d Cir. v. 599 (Fed.. 1135.3d 1364. Hughes Tool Co. Smith. such as Roche. 72 73 71 Patlex Corp. 630 F. Inc. Cir. Mem. Inc.. are allowed to copy and appropriate such path-breaking therapeutic inventions notwithstanding the inventor’s patents. 2005).” 72 The premise on which Amgen and others make the enormous investments to search for and develop new. Roche’s Opp’n to Amgen’s Inj. v. 429 F. v.’”) (quoting E. 758 F. v. and is based directly on the right to exclude. Inc. Pa.S. 488 F. Cir. at *28 (E. 1983). Eli Lilly & Co. Ortho Pharm. 71 “The encouragement of investment-based risk is the fundamental purpose of the patent grant.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 29 of 63 The promise of a secure financial reward is essential if any project is to be pursued.I. 90-0242. v. Corp. 1578 (Fed. Premo Pharm. USA..

v. Denial of an injunction against Roche puts Amgen’s entire product portfolio at risk. at 190:6-18 (Bernheim).] 78 A free-loader could significantly reduce its own risk by waiting and seeing which drugs — researched and developed by Amgen — are the most lucrative to usurp. 77 As Amgen’s Chief Executive Officer testified at trial. 1456 (Fed. .76 Besides. Amgen attempted to introduce its products in China.. even if you infringe Amgen’s patents. 76 77 78 79 In fact. at 32:19-33:1 (Sharer). life-saving therapies.”). Supp. Inc. 2d 578. 189:21-190:18 (Bernheim). see also 11/15/07 Remedy Hr’g Tr.2d 1446.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 30 of 63 and useful products and the cost involved in that process. It would create a powerful incentive to copy a successful product and simply pay a tax to get onto the market.2d. 846 (N.” 74 First. however. at 137.D. Cir. Datascope Corp. see also Hybritech Inc. . 630 F. external investors would lack confidence in Amgen’s intellectual property. 11/15/07 Remedy Hr’g Tr. See Premo Pharm. 1988) (noting that “in the absence of the injunction. 513 F. thereby reducing if not eliminating the incentive to discover and develop new. at 30:12-25. 849 F. Md. Johns Hopkins Univ. Supp. but doing so many times over to allow for investment and risk in hundreds of other product opportunities most of which will fail. For example. Sandoz. . 79 Instead of having the 74 75 Abbott Lab.. you don’t have to take all of the risks.. at 32:2-33:10. a lack of adequate patent enforcement has affected Amgen’s business in the past. The government. 37:15-21 (Sharer). See 11/15/07 Remedy Hr’g Tr. v. other potential infringers will be encouraged to infringe”).. chose 23 . 2007). you don’t have to invest all the money and research and development. 37:1539:3 (Sharer). thus devaluing the Plaintiffs’ property. 500 F. Id. you can infringe and just kind of pay a tax to come on the market[. 586 (D. 75 Additionally. v. Ill. the prize is not simply recouping the original investment. 2d 807. such denial would tell others in the world the only thing you have to worry about when you come on the market. Abbott Labs. 2007) (“[O]thers may be encouraged to infringe their patents and risk litigation. innovators would have no hope or certainty that even their investments could be recovered because competitors could copy and sell the patented inventions of true pioneers.

The evidence demonstrates that Roche is not truly interested in reducing health care spending or offering the choice of a novel biologic. at 205:11-206:21 (Bernheim). Roche’s February 2007 WAC Pricing and Contracting Strategies Review Meeting presentation 80 makes it plain that Roche’s entry will drive Medicare’s costs up — not down.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 31 of 63 incentive to take on the tough medical problems we face. etc. 2. and for the benefit of Roche and its chosen providers. Innovation would be replaced by copying. 80 81 RTX 6 (MIRCERA WAC Pricing). There is no assurance that permitting the infringement of Amgen’s patents under terms compelled by the Court will reduce public health care spending. 11/15/07 Remedy Hr’g Tr. In that presentation. at 29:16-30:1 (Sharer). Roche compares its intended ASP for Mircera with the ASP for an equivalent dose of EPOGEN. heart disease. permitting the continued infringement of Amgen’s patent rights provides no assurance that health care spending on anemia treatment will be reduced — let alone result in taxpayer savings so significant that they justify usurping the innovation incentives embodied in the patent system. forcing Amgen to withdraw. Contrary to Roche’s unsubstantiated promises. Roche’s driving interest is to take advantage of incentives created for new entrants in the ASP-based reimbursement system to attract providers with higher prices (not an innovative new medicine) — to the detriment of Amgen and Medicare. at R10-004975195. Id. By contrast Medicare’s cost for an equivalent dose of EPOGEN was $9.. Instead. Alzheimer’s. such as cancer. marketplace in third quarter 2007. 11/15/07 Remedy Hr’g Tr. 24 . Roche planned to launch with a reimbursement rate over $16. 81 Assuming its peg-EPO product would enter the U. pharmaceutical companies would have greater incentive to simply copy the successful products of others at little risk. as even its recent proposal shows.10 at that time (EPOGEN’s ASP for not to enforce Amgen’s patents and a number of copyists immediately entered the market.S.

Factoring in a competitive response. RTX 115 (CERA update regarding ASP Reimbursement) at R001619971. an advantageous pricing and contracting strategy “[a]voids downward pricing spiral in ESRD from Epogen contracting wars that would then effect [sic] the value of the ESA For Medicare Part B reimbursement rates. 82 Medicare would pay nearly double the current reimbursement rate for the same therapeutic response. Roche anticipated that Mircera’s ASP would be approximately $11 in the third quarter of 2010. at R001619973-974. And without a competitive response — and it has been shown that a price-cutting competitive response may be disfavored by businesses with a longer term competitive view — Roche forecasts that its infringing product will have an ASP of almost $13. at R10-004974846. at 205:11-206:21 (Bernheim).gov/McrPartBDrugAvgSalesPrice/.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 32 of 63 the current quarter is $8. 87 From Roche’s point of view. Medicare reimbursement rates will increase. Medicare will pay more for Roche’s infringing product than it currently pays for an equivalent dose of EPOGEN today. organized by year and by quarter at http://www. even after three years of Roche’s forecasted competitive response.” 86 It was also Roche’s view that excessive price competition would result in an undesirable downward price spiral. 85 Roche’s analysis of ASP’s dynamics observed that a “price increase can be good for both providers and manufacturers in the long run. The J-code for EPOGEN (Epoetin-alfa) is J0886. 25 . 84 Under either circumstance. Medicare will pay significantly more for an equivalent therapeutic response with Roche’s infringing product than for EPOGEN.cms. As business shifts from Amgen to Roche.46). RTX 6 (MIRCERA WAC Pricing) at R10-004975195. 83 Surprisingly.hhs. Aranesp (Darbepoetin) is J0881. the public will pay more. Id. Id. see Medicare’s ASP Pricing Files. 83 84 85 86 87 82 11/15/07 Remedy Hr’g Tr. Roche recognizes the tension between payers and providers and is reliant on both for success.

however. at R000228626 (emphasis added).” was based on a comparison of WAC prices. 90 91 92 93 94 RTX 6 (MIRCERA WAC Pricing) at R10-004974887. Id. 91 Recognizing that “the Glide Path does not initially address the issue of Budget Minimization for the payers. 93 But. Roche planned to launch at a 12% premium to Aranesp. 12/7/07 Remedy Hr’g Tr. 26 . Id. at 584:2-7 (Senich).Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 33 of 63 market.” 89 By pricing its infringing EPO product at a premium to established ESAs. Roche concluded. by the time of trial.” 88 To this end. But all of this occurs at Medicare’s expense. And by avoiding heavy discounting. Id. Roche planned to launch at a 12% “discount” to Aranesp. 94 Importantly. Roche has come up with a plan to avoid a “race to the bottom” and prolong the economic advantage conferred to new entrants — a strategy it calls the “Glide Path. RTX 99 (CERA NAOC Update) at R003917523. Roche intends to take advantage of the unique incentives offered to new entrants under the ASP system and exploit the uncertainties of dose conversion to give providers a compelling economic justification to switch ESAs all the while promote “on label” monthly dosing as a differentiator over existing ESAs (which also happens to be the dosing interval with the least dose efficiency).” 92 Roche explored ways to obscure the increased cost to Medicare that will result from the entry of its infringing product. 88 89 RTX 112 (CERA 5 Year Business Plan) at R000228589. that “discount. First. “we will not discount competitively in order to gain share in the ESRD business.”). R000228616 (“Roche will not discount to gain share with these chains. RTX 6 (MIRCERA WAC Pricing) at R10-004975031. at R10-004974963. at R10-004974960-963.” 90 The Glide Path will preserve Roche’s new entrant advantage providing Roche with substantial net revenues and providers will receive superior cost recovery.

95 96 97 98 RTX 6 (MIRCERA WAC Pricing) at R10-004975055 (emphasis added). Since Roche’s infringing product would be reimbursed based on its WAC at launch. Id. it pricing scheme at trial of 12% “discount” relative to Aranesp actually provides a basis for reimbursement that is higher than Aranesp’s ASP. 97 Although Roche’s January 28 Proposal purports to abandon efforts to peg the price of its infringing product relative Aranesp’s WAC. “[a]t launch. Aranesp is reimbursed ASP+6%. Roche conceded such was the case in its own planning documents.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 34 of 63 which of course masks the true cost to Medicare. the entry of Roche’s infringing product will increase — not decrease — Medicare’s costs. a “12% discount off WAC” translates to a 38% premium over Medicare’s reimbursement rate for Aranesp. Id. at R10-004975033. 2/15/08 Bernheim Decl.” 96 According to Roche’s calculations. Established ESAs. such as Aranesp and EPOGEN. MIRCERA will be priced higher than Aranesp ASP. are not reimbursed based on WAC.” 95 Roche’s various “discount” pricing schemes to preserve new entrant advantages all translate to substantial increases in reimbursement costs for Medicare. which is considerably lower than its list price (WAC). 98 If Roche is allowed to launch its infringing product. the Aranesp WAC becomes a less meaningful comparator . as Dr. are inappropriate for comparison — a fact Roche admits in its documents: “With the introduction of ASP. 27 . WAC prices. . Medicare (and patients) will pay substantially more for an infringing product than is currently paid for Amgen’s established ESAs. . ¶¶ 10-17. Indeed. Bernheim explains in his declaration accompanying this brief. Under every scenario uttered by Roche to date. the cost of Roche’s infringing product would still be significantly greater than that of EPOGEN — the product primarily used to treat dialysis patients. . therefore.

Roche bragged that given a compelling economic incentive. The public interest would not be disserved by an injunction where peg-EPO does not address an unmet medical need and is not clinically superior to currently available ESAs. 28 . DaVita would choose its product and that it had previously shifted 95% of its patients to a new therapeutic in a 90 day window. RTX 115 (CERA Update ASP Reimbursement) at R001619985.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 35 of 63 When the government shifted to ASP-based reimbursement.100 3. There are two questions properly at the center of whether the public interest would be disserved by the issuance of an injunction in this case: (1) (2) Does peg-EPO serve a significant medical need unmet by currently available medicines and medical practices.S. Roche viewed the change as a tremendous profit-making opportunity for it as a new entrant. Roche’s entry in the U. so that the medical benefits to the public outweigh the public’s other (non-medical) interests.S. Roche’s documents show that with such new entrant economics. Roche will choose to withhold its product from the U. market. and Is peg-EPO so medically superior to currently available medicines. market is premised on its ability to extract an immediate and significant premium. it is highly revealing that if the opportunity for a large windfall is removed. Roche seeks to offer sufficient cash recoveries to providers so as to drown out the attraction of EPOGEN — namely its well-proven efficacy and safety. R001620039 (Roche will walk away from LDO contract if price war ensues). as well as the other injunction prongs set forth in eBay? As discussed above. this calculus must be considered against the background that injunctions have only been denied in “rare and limited” circumstances for public health and 99 RTX 17 (Hickman Voicemail) at R001587133. 99 In the final analysis. at 597:18-24 (Senich). 100 12/7/07 Remedy Hr’g Tr. it can convince DaVita to choose Mircera at the formulary level.

See RTX 23 (4/6/07 Chertow Report) ¶ 25. 1990) (permanently enjoining use of prismatic surgical light system). v. 1990 U. 105 101 Commonwealth Sci. 601 F. 2007) (permanently enjoining solutions that increased the accuracy of the testing of pharmaceutical spray drug products). The public interest is in gaining access to therapies that address unmet medical needs and peg-EPO does not.”). v. the one medical need that most patients and doctors agree has been addressed is the treatment of anemia associated with chronic renal failure with currently available ESAs. Md.. v. Supp. ALM Surgical Equip. Corp.. 29 . Critikon. 2d 353 (S. 607 (E. 422:21-24 (Chertow) (“So. 104 In contrast. 23. 1994) (permanently enjoining balloon dilation catheter for treating coronary heart disease). Inc. Dist. Buffalo Tech. 2007) (permanently enjoining treatments for fragmenting clots within hemodialysis grafts). Research Org. 466 F. 6:89-1622-3. Tex. at 421:23-422:6. Dist. Inc. Inc. Tenn. 2007). but the need of anemia correction has been fully met in my opinion..D. Johns Hopkins Univ.D. 492 F. Apr. 05-12424-WGY.A. at 422:7-16 (Chertow). v. currently unmet medical needs include the need for improved arteriovenous access devices to reduce infection.).S. Inc. Inc. 813 (D. Becton Dickinson Vascular Access. Inc. LEXIS 14584 (D.S. SciMed Life Sys. Dist. v. Inc. v. Inc. Shiley. LEXIS 48475 (D. Schneider (Eur.. WDQ-06-2711. Minn.) AG v. 1993) (preliminarily enjoining safety catheters designed to eliminate risk to healthcare professionals of accidental exposure to AIDS). 93-108-JJF. Datascope Corp. WDQ-05-0759. Supp 2d 600. May 11. 2006) (permanently enjoining use of intramedullary nails and methods to treat femoral fractures).. Mass. July 16. 1985) (permanently enjoining bubble blood oxygenator for use in open heart surgery). 102 a. 2007 U. 2007) (permanently enjoining generic platelet aggregation-inhibiting agent). & Indus. suffer from a wide range of ailments for which there are inadequate treatments. Apotex. No.S. 964 (C. InnovaSystems. No. Supp. 2007 U. 103 For example.Y. Cal.S. Del. 103 104 105 12/6/07 Remedy Hr’g Tr. 12/6/07 Remedy Hr’g Tr.D. v.S.N. Aug. LEXIS 68972 (D. 1993 U. Supp. Dist. Kirschner Med.. 101 Thus. SanofiSynthelabo v. in general there are immense unmet [medical] needs in this population. Bentley Labs. 12/6/07 Remedy Hr’g Tr. LEXIS 19959 (D.D.. No. Inc. Supp. and the need to develop therapies to reduce mortality in these patients. 852 F. 9. courts have held that the impact on public health interests alone has been insufficient to warrant a denial of an injunction. at 422:7-24 (Chertow).. Synthes (U.S.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 36 of 63 safety concerns. Inc.. Corp. Patients with chronic renal failure. 492 F..C. and especially those on dialysis. 2d 978 (W.. Smith & Nephew. Nos.. 102 Proveris Sci.

In stark contrast. including that the number of administrations is relevant to dialysis patients. without regard for its effect. Roche argues to this Court that its “new” medicine allows for less frequent dosing and shots. Roche’s pegylated EPO product does not treat any medical need other than the correction of anemia associated with chronic renal failure. 106 As the label approved by the FDA plainly states. that EPO and Aranesp cannot be administered according to the same dosing scheduled as peg-EPO. and that the so-called convenience of fewer administrations should be considered in isolation. 12/6/07 Remedy Hr’g Tr. 108 Thus.109 Rather. (D.” 110 As a result. Mem. greater patient compliance. at 421:10-424:22 (Chertow). Roche has asserted that there is a benefit to “fewer shots.N.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 37 of 63 As its own documents and filings with the FDA acknowledge. and a slower rate 106 107 108 See RTX 4 (FDA Approval Letter for MIRCERA) at R008892352. as Dr. peg-EPO is an “erythropoiesis-stimulating agent (ESA) indicated for the treatment of anemia associated with chronic renal failure.]” 107 It is particularly telling that Roche has neither asserted nor identified in its regulatory documents any medical need addressed by peg-EPO that currently available ESAs do not. acting as if the jury has not already determined that its product infringes Dr. including patients on dialysis and patients not on dialysis[. Lin’s patents. Roche asserts that its pegylated EPO product must provide “substantial health and medical benefits” because it is a “new and different medicine” that has a “significantly longer half-life. 1589) at 1. Chertow testified. Roche’s ESA product is merely a me-too product and its availability to the public is not necessary to satisfy any unmet medical need.N. Mem. fewer doctor visits. 1589) at 15. The “convenience” of fewer injections is founded on a number of false premises. Roche’s Opp’n to Amgen’s Inj. 30 109 110 .” Roche’s Opp’n to Amgen’s Inj. Id. peg-EPO does not address or satisfy any unmet medical need. (D.

And.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 38 of 63 of hemoglobin rise in patients. matters of convenience. they are. EPOGEN is administered to nearly all dialysis patients via the IV tubing. at 655:22-656:3 (Fishbane). as matters of convenience. at 449:16-450:7 (Chertow). 114 Second. As an initial matter. their significance is grossly overstated. And. 113 EPOGEN’s recommended dosing regimen aligns with patients’ visits to dialysis centers. none of the so-called differences between peg-EPO and the currently available ESAs address an unmet medical need. Extended dosing does not reduce the need to visit a dialysis center. Aranesp delivers anemia management with extended dosing intervals. the IV route is recommended. and allows for dosing adjustments as needed. 12/5/07 Remedy Hr’g Tr. 12/6/07 Remedy Hr’g Tr. and is FDA approved for dosing intervals up to 111 112 See id. 31 . is also available to CKD patients (those patients who are not dialyzed). Roche’s “convenience” arguments fail to recognize that Amgen’s second ESA product. characterizing each of these differences as “unmet medical needs” or matters of “patient choice. and IV administration is recommended in the FDA-approved label. at 227:8-24 (Bernheim). For doctors. 12/7/07 Remedy Hr’g Tr. Roche’s arguments that its pegylated EPO product would be more convenient to use because fewer injections would be required ignores the realities of the vast majority of the lives of chronic renal failure patients. or providers who prefer less-frequent dosing. Most patients on dialysis (who are usually dosed three times per week) receive medications through an IV line. 113 114 RTX 53 (EPOGEN Label) at 26 (“In patients on hemodialysis. at 13-20. Aranesp. 112 They therefore do not receive “shots” at all. patients. delivered through the dialysis machine. whether or not they receive epoetin therapy. First. Rather.” 111 The evidence does not support Roche’s claims.”). patients with ESRD are required to undergo dialysis to have their blood cleaned. at best.

. RTX 50 (Aranesp Label) at 16. If. 119 Dr. . Note that peg-EPO is not FDA approved for the treatment of oncology-related anemia. and once-weekly or once-every-two-weeks for patients with anemia due to CKD or ESRD. Dr. Q4W dosing of epoetin alfa may provide added flexibility and convenience for patients and providers.000 U QW. Schmidt. id at 219 (“Extended [epoetin alfa] dosing intervals of every 2 wk to once every 4 wk have shown to be effective in maintaining Hb levels.”). 116 Patients are not even required to visit doctors in order to receive an injection. 18-21. results demonstrated that epoetin alfa can be initiated safely and effectively at an extended dosing interval of 20. or 40. 118 Indeed.”).000 U Q2W. 18. currently available 115 The FDA-approved label for Aranesp includes once-weekly and once-every-three-week dosing intervals for the treatment of cancer patients receiving chemotherapy. 120 This testimony stands in stark contrast to Roche’s attorney arguments regarding patient compliance. another doctor who testified for Roche.”).Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 39 of 63 once-every-three-weeks. at 626:9-18 (Schmidt). as its clinical trials were terminated due to safety concerns. acknowledged that she had used either EPO or Aranesp according to a once-monthly dosing protocol. RTX 50 (Aranesp Label) at 1.000 IU every 2 [weeks] in patients with [chronic kidney disease who are not on dialysis]. RTX 4 (MIRCERA Label) at R008892352. . 117 Moreover. but is more commonly used for the treatment of patients with CKD who do not receive dialysis.000 U Q4W was effective for the treatment of anemia in patients with CKD not receiving dialysis. according to such evidence. 115 Aranesp is used in some dialysis centers. as patients may self-inject Aranesp at home. . . Fishbane. there are multiple publications that teach that EPO and Aranesp may be used as infrequently as every two weeks to once a month to achieve stable hemoglobin levels within an appropriate target range. 116 117 RTX 105 (Spinowitz poster) (“Initiation of epoetin alfa using extended dosing regimens of 10. Aranesp is available in prefilled SureClick™ autoinjectors for patient convenience. See also RTX 34 (Benz publication) at 215 (“In this study. 20. 32 .000 U Q4W. 119 118 12/7/07 Remedy Hr’g Tr. was a member of an editorial board that published an article teaching physicians that Epoetin alfa and Aranesp can be effectively used to treat CKD patients once every four weeks. the doctor Roche presented at trial in support of its convenience argument. and in oncology patients. . 20.

Roche’s own expert witness has published his findings that higher degrees of hemoglobin variability are associated with negative consequences. 12/5/07 Remedy Hr’g Tr. and the person charged with providing the drug (the head administrator in a dialysis center). at 344:9-345:13 (Lipps). one of Roche’s Phase III clinical trials). 443:17445:12 (Chertow). and Roche’s forecasts suggest that almost all ESRD patients may be converted back to Q2W dosing if bundling is implemented — making peg-EPO no more convenient than other FDA-approved dosing regimens. concluded “that greater hemoglobin variability is independently associated with higher mortality”). See also 12/6/07 Remedy Hr’g Tr. 12/6/07 Remedy Hr’g Tr. at 425:22-426:7. however. 121 Third. 122 Roche’s public statements.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 40 of 63 ESAs already can be administered once every two. Fishbane. if a doctor is truly worried about patient compliance. Compare RTX 26 (Levin publication) at fig. Roche’s advocacy also ignores that an extended regimen carries with it additional complications. 433:2-439:15 (Chertow). at 2641:13-2643:23 (Benet). 122 10/15/07 Trial Tr. Simply put. 120 121 Id. 124 Roche attempts to direct the Court’s attention away from these facts. peg-EPO’s purported extended dosing regimen results in higher degrees of hemoglobin variability and less control over hemoglobin levels. See also 12/6/07 Remedy Hr’g Tr. at 511:5-16 (Lubina). however. the person charged with treating the kidney patient (a nephrologist). at 659:17-660:14 (Fishbane).or four-weeks. The data show much more variability when the weekly hemoglobin values are plotted. at 439:7-442:12. 123 Importantly. RTX 39 (Yang publication) at 3164 (analyzing data from a large national cohort of hemodialysis patients. 124 123 33 . including Roche’s Dr. nor is it sufficient to override our patent laws. obscure this fact. they already have the ability to prescribe products with an extended dosing interval. the authors. See RTX 131 (2007 MIRCERA Business Plan) at R11-000637998. Note that many patients will be required to use Q2W dosing regimens. the “convenience” that peg-EPO’s Q2W or Q4W dosing may offer is not an unmet need in the marketplace. with RTX 31 (presenting mean weekly hemoglobin values for the same study).3 (presenting mean monthly hemoglobin values for MAXIMA. As evidenced by the testimony of the person charged with monitoring what the drug does to the body (a pharmacologist).

and it may be the catheter of choice among physicians. (D. RTX 53 (EPOGEN Label). Bentley Labs.”). In Schneider (Europe) AG v. even regarding medical devices.. 1990 U. Inc. 1589) at 16-17. Inc. 851 (D. RTX 50 (Aranesp Label). but mere personal preference alone does not justify denying an injunction. at 344:9-18 (Lipps). 23. at *49.. several courts have held otherwise. . Kirschner Medical Corp. Inc. Dist. 34 .S. 127 But even assuming that peg-EPO provides some marginal convenience or some ephemeral value in the form of choice despite only a demonstration of non-inferiority in clinical trials. where the court held that the “incentive to engage in the toils of scientific and technological research” outweighed “inconvenience to customers. v. .C. LEXIS 14584. this phenomenon does not speak to the medically acceptable hemoglobin rate of rise of currently available ESAs 126 and certainly does not address the real world issue confronted by dialysis providers. *52-53 (D. Inc. see also Shiley. No. Schneider (Eur. Minn. like Fresenius.. 852 F. Inc. .Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 41 of 63 by relying on a purported “slower rate of rise” in hemoglobin levels. who want the better hemoglobin control that comes with a shorter acting agent.” 128 A similar conclusion was reached in ALM Surgical Equipment. the court observed: “It is undoubtedly true that some physicians strongly prefer the [infringing device] . 6:89-1622-3. In fact. 1994). There is no precedent supporting Roche’s request that the rights of a practicing patentee be trampled in the name of convenience.D. its availability does not outweigh our nation’s patent laws and the innovation they encourage. 12/5/07 Remedy Hr’g Tr. Kirschner Med. 964. 601 F. Mem. 1985) (“[N]o credible evidence in the trial record supports any finding that either is objectively superior in performance or that either is defective or unsafe. . Scimed Life Systems.S. Inc. ALM Surgical Equip. Cal. Supp. 970 (C.) AG v. Corp... Scimed Life Sys. 813. Supp. .N. 125 Taken as true. v.” 129 125 126 127 128 129 Roche’s Opp’n to Amgen’s Inj. 1990).. The evidence amounts to no more than a mere expression of preference. v.. Apr..

” 131 Indeed Roche admitted as much in its 2005 negotiations with LDOs. 134 more studies are needed to understand the full spectrum of health and safety issues presented by peg-EPO. RTX 25 (11/13/07 Chertow Report) ¶¶ 12-15 (discussing the findings of the European Medical Association (EMEA)). significant clinical differentiation.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 42 of 63 In truth.. at 426:23-427:5. Roche specifically reported to FDA that in its Phase III clinical trials. 431:18-432:11 (Chertow). at 512:2-8.” 132 Similarly. 512:2-8 (Lubina). is at best non-inferior in efficacy to the currently available ESAs. 35 . Roche’s peg-EPO. the data showed only that Roche’s peg-EPO product was “non-inferior” and “comparable. and thrombocytopenia than patients receiving currently available 130 131 132 133 134 12/6/07 Remedy Hr’g Tr. in its Integrated Summary of Efficacy. Roche asks this Court at Amgen’s and Medicare’s expense to allow Roche onto the market so that it can increase its profits and those of select providers who are interested in increased cost recovery. This is because patients receiving peg-EPO are statistically more likely to suffer from sudden death throughout the study. RTX 108 (E-mail regarding economic considerations) at R001593762. 133 Rather. 514:22-515:3 (Lubina). There is no evidence that Roche’s product is clinically superior to established ESAs. “CERA would need to appeal to the LDOs on economic factors” because “CERA’s phase III clinical trials are not powered to demonstrate . 130 For example. e. As Roche’s former Vice-President of Anemia Products noted in an email following her discussions with DaVita. .g. RTX 103 (Integrated Summary of Efficacy) at ITC-R-BLA-00040110. death during the titration phase of the study. gastrointestinal bleeding. Roche simply has no evidence that its product is safer. 12/6/07 Remedy Hr’g Tr. b. by its own representations to the FDA. RTX 4 (Mircera Label) at R008892361 (noting the increased likelihood of gastrointestinal bleeding in patients treated with peg-EPO). See. . as set forth in FDA’s approval letter and the European regulatory agency’s scientific discussion of the Roche clinical trials.

136 137 Roche’s Opp’n to Amgen’s Inj. 139 138 12/6/07 Remedy Hr’g Tr. patients having one or more excursions outside the target hemoglobin range were significantly more likely to suffer from serious adverse events. 16. A PERMANENT INJUNCTION IS NOT PRECLUDED BY ROCHE’S UNCLEAN HANDS OR PATENT MISUSE DEFENSES. 136 as discussed above. (3) Amgen offers multi-product rebates for Aranesp in oncology. in stark contrast to Roche’s claim that peg-EPO provides a slower and steadier rate of hemoglobin rise and control. (2) Amgen promotes overdosing of ESAs. (D. 12/6/07 Remedy Hr’g Tr. 433:2-439:15 (Chertow). 508:15-511:16 (Lubina). see also RTX 31 (Mean Dose and Mean Hemoglobin BA16739 Maintenance Study). 137 These differences are significant. at 433:2-439:15. In its brief. 139 F. Roche’s expert has directly tied increased hemoglobin variability to an increased likelihood of death. 138 As Roche’s own clinical trials show.5 g/dL results in a 53% increased likelihood of death). Mem. 1589) at 2. 451:3-22 (Chertow). 515:15-516:4 (Lubina). 515:15-516:4 (Lubina). 510:13-511:16. at 424:10-13. even in the well-controlled environment of clinical trials. see also RTX 33 (Incidence of Specific Events).2 (showing that hemoglobin variability of greater than 0. 135 And. tbl. 135 12/6/07 Remedy Hr’g Tr. 36 . the hemoglobin levels of patients receiving peg-EPO are more variable and more likely to fall outside safe target ranges than patients receiving established ESAs. Roche argues that Amgen is not entitled to an injunction because “Amgen has committed misconduct in the ESA market which bears an ‘immediate and necessary relation to the equity that [Amgen] seeks’ and amounts to unclean hands. 508:15509:16. and that variability of greater than 1.5 g/dL results in a 15% increased likelihood of death. RTX 33 (Incidence of Specific Events). RTX 39 (Yang publication) at 3167.N.’” 140 While Roche did nothing to develop these points at trial. 443:17-446:3. Roche casts aspersions at Amgen regarding the following alleged misconduct: (1) Amgen has entered into a long term agreement with Fresenius.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 43 of 63 ESAs. at 451:23-460:4 (Chertow).

Quickturn Design Sys. General Excavator Co.N. 1586) at 1-5. on Roche’s Antitrust and State Law Countercl. 142 No evidence has been submitted and no argument advanced that justifies denying Amgen’s request for an injunction based on any actions Amgen has taken in the ESA marketplace. 141 But Roche failed to prove that Amgen has engaged in any actions that are either unlawful or otherwise rise to the level of unclean hands or patent misuse. 324 U. v. 269 F. and (5) Amgen withholds Aranesp discounts and products from dialysis centers.. Mach. v. 1589) at 30.S.g.. 386. 144 143 See. of Amgen’s Mot.S. 819 (1945). to Prevent Roche from Introducing Alleged Antitrust Evidence to Supp. 142 See Amgen’s Patent Misuse Mem. Regarding the Inapplicability of Patent Misuse to the Facts of this Case (D. Reinhard. 2001)... an Unclean Hands or Patent Misuse Defense (D.]. Cir.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 44 of 63 (4) Amgen has refused to guarantee discounts to customers and has notified them of their potential infringement liability. for Summ. Amgen also respectfully refers the Court to Amgen’s Mem. 290 U.F. Id.N. v. Co. Mem.3d 1369. J.” 143 Courts have applied the doctrine of unclean hands in patent cases involving fraud during the procurement or enforcement of a patent-in-suit or where litigation misconduct was involved. Keystone Driller Co. the act must “affect the equitable relations between 140 141 Roche’s Opp’n to Amgen’s Inj. Precision Instrument Mfg. (D. Aptix Corp. for a recitation of the law of patent misuse and the reasons why such defense should not preclude the issuance of an injunction. This brief primarily focuses on Roche’s unclean hands theory. The doctrine of unclean hands provides a defense to an otherwise valid legal claim only if Roche first proves that Amgen has performed “some unconscionable act. Inc.3 (discussing Roche’s abandonment of its tying allegations in response to Amgen’s Bench Mem.” that is. 519). See infra Part II. Co.N. 165 U. of Law in Supp. Maint. Auto.. (D.N. e. at 30-33.S. 240. 806. 245 (1933) (quoting Deweese v.” which is an act that is “offensive to the dictates of natural justice. Roche’s Opp’n to Amgen’s Bench Mem. 144 Roche must next demonstrate that the alleged unconscionable act bears an “immediate and necessary relation to the equity that [Amgen] seeks in respect of the matter in litigation. 390 (1897)). 1632) [hereinafter Amgen’s Patent Misuse Mem. 1374-75 (Fed. 37 .

the “immediate and necessary relation” limitation means that a plaintiff must “have engaged in misconduct which bears upon the validity of the patent or defendant’s infringement of the patent for the unclean hands defense to be available. 882 (3d. .N. at *3 (N. 147 At bottom. [w]hile we explicitly stated that no injury needed to be shown. 1586) at 2. for this proposition.” In re New Valley Corp.”145 Prior cases have held that in the context of a patent infringement suit. 146 Southwire Co. (D. Roche’s Opp’n to Amgen’s Bench Mem. Inc. this court applied the doctrine of unclean hands in a proxy contest context. Roche suggests that unclean hands “has nothing to do with the rights or liabilities of the parties” and that the defendant “need not be damaged” to assert unclean hands.101. . 1999) (emphasis added). Roche complains that Amgen’s agreement with Fresenius constitutes an unconscionable act sufficient to prohibit issuance of an injunction. 81 C 3313. 1589) at 31 n. No. May 24. as described in further detail below. to Prevent Roche From Introducing Alleged Antitrust Evidence to Supp. v. 269 F. at 245. . 38 147 . Roche relies extensively on non-binding precedent in Gaudiosi v.N. Mem. which concerned the validity of a corporate election. 526 (3d Cir. Amgen has committed no misconduct and certainly nothing that approaches an unconscionable act regarding the marketplace for ESAs. 1589) at 32-33.D.. Dist. Amgen’s agreement with Fresenius — voluntarily negotiated and entered into without coercion — is lawful and does not support Roche’s unclean hands defense.” and defers competition and price decreases through its fiveyear Fresenius agreement. 290 U. See Roche’s Opp’n to Amgen’s Inj. an Unclean Hands or Patent Misuse Defense (D. 1983). 181 F. any actions that Amgen has taken have been completely lawful and within its rights as a patent owner. Mem. but fails to disclose that the Third Circuit has limited its own holding in Gaudiosi: “In Gaudiosi.S.S.. (D.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 45 of 63 the parties in respect of something brought before the court for adjudication. Cir. LEXIS 16724. 1959).2d 873. Ill. Essex Group. Roche alleges that it is inequitable for Amgen to receive injunctive relief because Amgen “artificially maintains high prices.3d 517. 1983 U. Mellon. 1.N. But more importantly. it is crystal clear from the facts of the case that Gaudiosi’s misconduct—the intimidation of shareholders—was directly related to the case before the court. 145 Keystone.” 146 Roche cites to no case law in support of its position that marketplace activities of the type alleged can justify denying an injunction. In contrast. Roche’s Opp’n to Amgen’s Inj.

A. 1632). 153 Nor can Roche demonstrate how Amgen’s voluntarily negotiated contract with a willing third party bears any “immediate and necessary relation” to the claim at issue or otherwise 148 149 Amgen’s Patent Misuse Mem. 344:4-346:15 (Lipps). Roche cannot prove that Amgen’s agreement with Fresenius can legally be considered an unconscionable act. Tr. to Amgen’s Patent Misuse Mem. As set forth in Amgen’s Patent Misuse Memo. Roche’s assertion that Amgen’s conduct artificially maintains high price fares no better because all of the evidence shows that EPOGEN’s ASP has actually decreased over time. Roche’s Resp. at 52:13-21 (the McGorty deposition testimony cited herein was submitted to the Court by Roche as remedy-related deposition designations on 12/14/07). McGorty is Fresenius Medical Services’ Vice President of Finance and Administration.]. Regarding the Inapplicability of Patent Misuse to the Facts of This Case (D. arguing that “there is no reason to require Fresenius to make a sole source commitment. 323:10-16. Mr. at 319:8-320:9. 12/5/07 Remedy Hr’g Tr. 1642) at 7 [hereinafter Roche’s Resp. (D. the evidence shows that Roche intends to enter the marketplace at a price higher than the EPOGEN’s ASP to maximize cost-recovery for ESA providers and profits for itself. 152 In contrast. (D. 148 however. 9-10.N.N. 3/30/07 McGorty Dep. 1632) at 2. Roche therefore focuses on the agreement’s “sole source” provision. See infra Part III. 149 Based on this fact alone. 344:4-346:15 (Lipps). See 12/5/07 Remedy Hr’g Tr. 323:10-16.N.” 150 This argument ignores that Fresenius desired a long-term contract with Amgen because it preferred EPOGEN over peg-EPO for its dialysis patients.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 46 of 63 As more fully set forth in Amgen’s Patent Misuse Memo. 151 not because Amgen required it or otherwise coerced Fresenius into an agreement. 150 151 152 153 39 . to Amgen’s Bench Mem. at 318:4-320:9. there can be no dispute that Fresenius entered into its agreement with Amgen because it preferred EPOGEN. See Amgen Patent Misuse Mem.

Maint. v.S.S. Roche’s Resp. 1565 (Fed.N. E..Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 47 of 63 affects the equities between the parties before this Court.” 156 2. As described by Fresenius’s CEO. 2005 U. 240. 806. v. 154 Roche attempts to satisfy its burden by pointing to overlapping subject matter. Dillon & Co. v. 04-3511. BioTech. Gen. Auto. Roche’s next allegation is that Amgen acted untoward because the Fresenius agreement did not include a contractual “bounty to encourage lack of over-administration. 1996). Co. 40 . 155 156 157 158 159 160 154 Roche’s Opp’n to Amgen’s Inj. Inc. Roche’s theory is counter to the public interest in the enforcement of valid contractual agreements. has held that this argument fails as a matter of law: “The mere fact that the ‘misconduct’ arises from some overlapping facts is not enough. Cir. see also Precision Instrument Mfg. In fact. 80 F. Co. José S. the government withholds reimbursement for ESAs if patients’ hematocrit levels remain too high. 290 U.N. Dr. Allan Block Corp. 324 U. 245 (1933).. Amgen does not and cannot incentivize overuse of ESAs. Inc. v. 155 The First Circuit. This represents an unprecedented and unwarranted stretch of the doctrine of unclean hands.. Amgen’s purported failure to provide another disincentive to the over-utilization of its products is hardly an unconscionable act offensive to the dictates of natural justice. General Excavator Co. however.3d 11. Id. 814-15 (1945). 1642) at 9. 2007). 160 See Keystone Driller Co. 15-16 (1st Cir. No. at 413:2-6 (Lipps). Corp. v. by taking issue with the contractual terms of a contract (to which it is not a party). Roche presumably asks this Court to take the extraordinary step of reforming a valid contract to include such a bounty. Mem. Mach. 488 F.S. (D.3d 1553.” 157 But Roche’s conclusion that Fresenius “is more likely to over-administer ESA’s than if those contractual incentives did not exist” 158 is not only unsubstantiated by any evidence. (D. Perez-Perdomo. to Amgen’s Patent Misuse Mem. 1589) at 30-33. Lipps. Genentech.. but ignores the countervailing evidence of disincentives for over-utilization provided by the government’s strict reimbursement policy. Belaval. 12/6/07 Remedy Hr’g Tr. 159 Under these circumstances. arguing that Amgen’s alleged misconduct involves “the ESA market” and that Amgen’s patents also relate to ESA products. Mr.

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3.

Amgen’s pro-competitive, multi-product rebates in oncology do not constitute unclean hands or patent misuse.

Roche has re-packaged its prior bundling contentions 161 by arguing that Amgen “refuses” to grant rebates on Aranesp to oncology providers unless they also agree to purchase Amgen’s white-blood cell related products, Neulasta® and NEUPOGEN®. 162 Amgen does provide lawful discounts in oncology, but that fact has no bearing on an unclean hands defense because pegEPO is not approved by FDA for use in any oncology indication. 163 The law is clear that this cannot be the basis for unclean hands because the unclean hands doctrine does not apply to conduct which is not related to the merits of the controversy between the parties. 164 Indeed, Roche’s approved label specifically includes a “black box” warning against use in oncology since there was a statistically higher incidence of death for oncology patients using peg-EPO than established ESAs. 165

Dist. LEXIS 13566, at *25-26 (D. Minn. July 1, 2005) (“[T]he public interest is served by upholding the parties’ contractual obligations.”), aff’d without op., 170 Fed. Appx. 130 (Fed. Cir. 2006). Until the remedy phase of trial, Roche’s antitrust claims and unclean hands defense focused on allegations that Amgen was impermissibly leveraging its patents covering its white-blood cell products to extract monopoly prices for Aranesp. See, e.g., Roche’s Answer and Countercls. to Pl.’s Compl. (D.N. 140) ¶ 56; Roche’s First Am. Answer and Countercls. to Pl.’s Compl. (D.N. 344) ¶ 75. Roche has belatedly flipped this argument on its head by arguing that Amgen’s practices extend its EPO patents into the white-blood cell-related product market in an attempt to conform its allegations to the elements required to show patent misuse. While Roche should not be allowed to change its allegations at the thirteenth hour, taken either way, Roche cannot meet its burden of showing that Amgen’s acts derive their force from the asserted EPO claims.
162 163 161

Roche’s Opp’n to Amgen’s Inj. Mem. (D.N. 1589) at 32-33.

Roche’s oncology clinical trials were terminated due to safety concerns. RTX 4 (MIRCERA Label) at R008892352.
164 165

See Dr. José S. Belaval, Inc. v. Perez-Perdomo, 488 F.3d 11, 16 (1st Cir. 2007).

RTX 4 (MIRCERA Label) at R008892353 (“Cancer: Mircera is not intended for the treatment of anemia due to cancer chemotherapy. A dose-ranging study of Mircera was terminated early because of significantly more deaths among patients receiving Mircera than another ESA.”).

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In the context of an unclean hands defense, Roche fails to establish that Amgen’s multiproduct rebates in oncology have in any way dirtied Amgen’s hands. The challenged discounts are not improper because: (1) they are all above cost; (2) hospitals are not required to purchase any Aranesp from Amgen; and (3) Amgen does not bar its customers from purchasing competing products. The contracts complained of presented an option to customers by which they could qualify for additional rebates on certain products if they meet or exceed a percentage-based purchase threshold for Aranesp. 166 Again, this hardly implicates conduct that is offensive to the dictates of natural justice. Roche simply transforms the legitimate acts of a patentee “into an open-ended pitfall for patent-supported commerce.” 167 Roche also fails to demonstrate how offering pro-competitive multi-product rebates in oncology to willing third parties bears any “immediate and necessary relation” to the claim at issue or affects the equities between the parties before this Court. 168 Moreover, Roche ignores that NEUPOGEN, Neulasta, and Aranesp have been separately patented. 169 Amgen’s actions are all within the legitimate rights of a patent owner to market its various products, and Roche has made no showing to the contrary. 4. Amgen is entitled to enforce Dr. Lin’s Patents and is not obligated to guarantee discounts in perpetuity.

Roche alleges that Amgen “threatened” customers by explaining their potential infringement liability and informing them that they would not be guaranteed the same contract
166

3/28/07 Manak Dep. Tr. at 20:2-21:4 (the Manak deposition testimony cited herein was submitted to the Court by Roche as remedy-related deposition designations on 12/14/07). C.R. Bard, Inc. v. M3 Sys., Inc., 157 F.3d 1340, 1373 (Fed. Cir. 1998).

167 168

See Keystone Driller Co. v. General Excavator Co., 290 U.S. 240, 245 (1933); see also Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 814-15 (1945); BioTech. Gen. Corp. v. Genentech, Inc., 80 F.3d 1553, 1565 (Fed. Cir. 1996).

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price for EPOGEN if, after dropping EPOGEN for peg-EPO, they returned to negotiate a new contract with Amgen. Specifically, of the hundreds of small dialysis organizations (SDOs) in the United States, administrators from two, Tracey Mooney and Maureen Michael, testified that Leslie Mirani, Amgen’s Vice President of Sales, told them that their clinics may not receive the same contract if they switched to another product and came back, and that they could be subject to legal liability if they switched to peg-EPO. 170 As an initial matter, the fact that purchases of peg-EPO could create infringement liability was independently confirmed by an attorney with whom Ms. Michael spoke. 171 Again, these actions are entirely lawful as Amgen must be allowed to make its rights known to all potential infringers. 172 Nor has Roche demonstrated how Amgen’s notifying third parties of their potential liability bears an “immediate and necessary relation” to the equity sought before this Court. A threat to third-party retailers or competitors (even where a communication did constitute a threat) is not grounds for an unclean hands defense where the competitive product was held to infringe valid and enforceable patent claims.

169

See, e.g., U.S. Patent Nos. 5,580,755 (covering NEUPOGEN and Neulasta), 5,824,784 (covering Neulasta) and 7,217,689 (covering Aranesp). 3/27/07 Mooney Dep. Tr. at 21:23-22:9; 3/9/07 Michael Dep. Tr. at 43:9-24, 45:16-23 (the Mooney and Michael deposition testimony cited herein was submitted to the Court by Roche as remedy-related deposition designations on 12/14/07).

170

3/9/07 Michael Dep. Tr. at 62:11-15, 62:20-64:3, 65:5-66:6; 3/20/07 Torley Dep. Tr. at 127:12-25; 4/2/07 Mirani Dep. Tr. at 129:20-130:5, 155:19-156:5 (the Torley and Mirani deposition testimony cited herein was submitted to the Court by Roche as remedy-related deposition designations on 12/14/07).
172

171

See Virginia Panel Corp. v. MAC Panel Co., 133 F.3d 860, 869 (Fed. Cir. 1997) (“[A] patentee must be allowed to make its rights known to a potential infringer so that the latter can determine whether to cease its allegedly infringing activities, negotiate a license if one is offered, or decide to run the risk of liability and/or the imposition of an injunction.”).

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” without the benefit of rebates or discounts. by reason of his having . Mem. The evidence does not support this characterization. at 38:9-39:7 (Sharer). 155:19156:8. the public cannot be assured access to a longer-lasting ESA. Roche presented no evidence that any of Amgen’s alleged statements adversely affected a single customer or otherwise had any anticompetitive effect. Amgen has never refused to sell its patented goods to any customer who also wishes to purchase Roche’s infringing ESA. at 180:17-182:7. Amgen does not withhold products from dialysis providers Roche alleges that Amgen “effectively” withholds Aranesp from dialysis providers and. . (D. Roche characterizes Amgen’s communications as threats to its customers of having to pay “list prices. 173 The statements made by Ms. 1642) at 13.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 51 of 63 Similarly.C. 175 176 3/20/07 Torley Dep.N. 126:24-127:22. 174 Furthermore. In Roche’s Resp. Amgen’s refusal to guarantee future discounts and pricing is a matter of contract law based on the great uncertainty about what will happen to Amgen’s pricing if peg-EPO comes to the U. . 177 Roche’s argument is 173 See 35 U. Tr. 175 Still. Mirani were not threats at all. 129:6-130:5. 44 . deemed guilty of misuse . See 3/20/07 Torley Dep. 176 Roche cannot demonstrate how Amgen’s failure to guarantee discounts bears an immediate and necessary relation to this case. Tr.”). 5. (D. at 38:9-39:7 (Sharer).S. 177 Roche’s Resp.S. to Amgen’s Patent Misuse Mem. Roche’s Opp’n to Amgen’s Inj.N. at 180:17-182:7. Tr. 11/15/07 Remedy Hr’g Tr. . . at 125:12-126:11. to Amgen’s Patent Misuse Mem. . but factually correct statements made in an effort to address customer concerns. There is also no basis for Roche’s argument that a failure to guarantee discounts in perpetuity constitutes an unconscionable act. 174 4/2/07 Mirani Dep. 11/15/07 Remedy Hr’g Tr. 1589) at 31. Amgen’s good-faith attempt to communicate with its customers about potential infringement liability does not constitute patent misuse as a matter of law. sought to enforce his patent rights against infringement or contributory infringement.N. 1642). . (D. marketplace. § 271(d)(3) (2007) (“No patent owner otherwise entitled to relief from infringement or contributory infringement of a patent should . therefore. 155:2-7.

and it is remains the case that Roche’s peg-EPO would be priced such that it will cost Medicare more than it is currently paying for Amgen’s EPOGEN. Roche’s assertions of misconduct were not proven at trial and form no basis for denying an injunction to Amgen to prohibit Roche’s further infringement. Roche’s Resp. nonsensical. 943-45 (9th Cir. 4. Inc. III. Kogod is the President of DaVita’s Western Operating Group. RESPONSE TO ROCHE’S JANUARY 28. it is clear that Roche’s theories are inconsistent and. Except for a slightly lower launch price than it had previously planned. Roche filed a “proposal for economic terms” under which it believes the Court should allow Roche to market its infringing EPO product in the United States. however. Roche’s Proposal 4/2/07 Kogod Dep. Roche’s peg-EPO still does not meet any unmet medical need. indeed. Both of Amgen’s ESAs — EPOGEN and Aranesp — are available to all dialysis providers.” while faulting Amgen for not offering enough “essential rebates” to dialysis customers..Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 52 of 63 factually incorrect. (D. 179 178 Contrasting Roche’s allegations regarding the Fresenius agreement with its arguments here. This belated submission was not a serious proposal. because the terms were grossly inadequate to compensate Amgen for Roche’s infringement.N. Roche next argues that Amgen “effectively” refuses to market Aranesp presumably because its current discounts are not to Roche’s satisfaction. however.g. 179 This. at 26:18-27:7. 180 45 . Vitamin Technologists. Wis. 146 F. Found. 1945) (denying permanent injunction where patentee refused altogether to apply a new process of fortifying oleomargarine with vitamin D). e. Alumni Res. See also 11/15/07 Remedy Hr’g Tr. at 44:9-45:6 (Sharer). Tr. 180 In summary. 1642) at 1. 2008 PROPOSAL More than a month and a half after the injunction trial was completed (and more than two months after the Court initially requested one). Mr. See.2d 941. Roche simultaneously argues that Amgen’s rebates to Fresenius constitutes a “bribe.. 28:10-18 (the Kogod deposition testimony cited herein was submitted to the Court by Roche as remedy-related deposition designations on 12/14/07). 178 Lacking evidence and legal precedent. to Amgen’s Patent Misuse Mem. v. is easily distinguishable from cases where a patentee refuses to practice its invention to the detriment of the public.

If it were otherwise. While Roche waved its proposal in front of the press to generate attention. such assertions by Roche are completely without merit. next month. Obviously. A. Roche intends to launch peg-EPO in the U. enforceable.S. and Amgen’s validated patent rights only reinforces the need for the issuance of an injunction at the earliest time possible to stop Roche’s belligerent actions. and easily in the billions of dollars. Roche is attempting to force its way onto the market and cause immediate and irreparable harm to Amgen. its recent “new” plan would still cost the government more than the current expenditures on Amgen’s EPOGEN because both the price and dose of peg-EPO would be 181 Mem. 2007 (D. the Court should disregard Roche’s Proposal as coming too late and should decide the injunction issue based on the evidence presented at trial rather than some unsubstantiated and untested post-trial proposal by Roche. ROCHE’S PROPOSAL WOULD EXACT A HIGHER REIMBURSEMENT FROM MEDICARE. the real reason for Roche filing it seems to be to alert the Court and Amgen that despite the jury verdict and Court decisions to date upholding the patent as valid.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 53 of 63 changes nothing regarding the evidence presented to the Court during the trial. of Roche’s Proposal Pursuant to the Court’s Instruction of December 7. Roche will still come in at a reimbursement advantage to Amgen’s EPOGEN (and Procrit which shares the same ASP as EPOGEN) — thus allowing Roche to offer greater economic incentives to attract customers — and the glide path analogy still describes the likely pricing scenario over time. this Court’s timely efforts. Just as with its marketing plans in place before trial. Without providing any details of its analysis. Roche’s display of complete disdain for the jury’s decision.N. 46 . 1651) at 2.” 181 As demonstrated at trial. and infringed. In Supp. Roche asserts that the savings to Medicare under its Proposal “will be substantial.

at R10-004975077 (“The more robust MIRCERA/Epoetin data validates the 1:1 Aranesp conversion ratio. RTX 6 (MIRCERA WAC Pricing) at R10-004975076 (“Selected conversion factor = 1 mcg CERA per 1 mcg Darbepoetin for Q4W. taking instead the dose conversion ratios calculated by Dr.000 IUs per week). 183 In so doing.”). A (D. RTX 6 (MIRCERA WAC Pricing) at R10-004975068-69. For example. 185 As further example. 182 Consequently. According to Roche’s own documents and product label. Roche’s assertion that Roche’s Proposal will result in billions of dollars in savings is completely unfounded. 2/15/08 Bernheim Decl. e. not to EPOGEN.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 54 of 63 higher than those for EPOGEN. Dose conversion also drives a higher usage and higher costs for switching to peg-EPO from EPOGEN. peg-EPO’s use in dialysis will cost Medicare about 45% more than EPOGEN. Roche shows its true colors by obscuring the reality that peg-EPO would cost Medicare up to 45% more than EPOGEN for the treatment of anemia in dialysis. even under Roche’s new Proposal.”). ¶ 14. Lubina.N. Market with Mircera. App. See. B at 8 (providing DCR estimates of 303 IU/mcg for Q2W dosing and 240 IU/mcg for Q4W dosing).g. Roche’s Proposal ties its launch price to the ASP of Aranesp. While the realworld dose conversion ratio remains uncertain. 184 185 186 RTX 30 (5/11/07 Lubina Rebuttal Report) Ex. ¶ 14. the cost of therapy for peg-EPO under Roche’s Proposal would be approximately 45% higher than the weekly cost of therapy for a patient currently receiving an EPOGEN dose of 19. Even though Roche is targeting dialysis providers and would be competing directly against Amgen’s EPOGEN. RTX 4 (MIRCERA Label) at R008892353-54. taking the peg-EPO “starting doses” set forth in Roche’s FDA label 184 and the average weekly EPOGEN dose (19. 1651-2) [hereafter Roche’s Proposal] (“[MIRCERA’s] per unit WAC would be calculated based on the conversion of monthly MIRCERA dosing to the equivalent monthly Aranesp dosing. 186 if peg-EPO were utilized entirely on a once every four weeks 182 183 2/15/08 Bernheim Decl. 47 . Roche’s Proposal for Entering the U..000 IUs per week (the average weekly EPOGEN dose).S. id. Roche’s forecasts determined the peg-EPO-toAranesp relationship to be one-to-one on a weekly equivalent basis.”).

but given the particular clinical trial exclusion criterion used in Roche’s clinical trials and FDA’s recognition that its particular exclusion criteria was not representative of the general patient population. at 570:6-8 (Senich). ¶ 13. 190 For example. See supra Part II.3 (regarding the dialysis patient’s treatment regimen and the need. its cost of therapy would still be 28% higher than the cost of therapy with EPOGEN.E.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 55 of 63 (Q4W) dosing regimen. but assumed to be utilized entirely on a once every two weeks (Q2W) dosing regimen. Roche is still seeking to set its price “as high as [it] can that payers will pay for and then glide down given the regulatory scheme. Id. 12/7/07 Remedy Hr’g Tr. 189 To be sure. the exact premium will depend on how peg-EPO dosing translates from clinical trial to clinical practice. or lack thereof. appreciates. rather than lowering cost to Medicare. its cost under Roche’s Proposal would still be higher than the cost of EPOGEN. RTX 4 (MIRCERA Label) at R008892348. Lubina’s dose conversion ratio estimates. of a product that can be given on an extended dosing regimen). the FDA has required Roche to conduct additional post-marketing studies that include problematic CRP patients. Id. 191 192 48 . 192 As Roche’s Vice President of Sales and Marketing admitted. 190 the evidence suggests that Roche’s forecasted dose conversion ratio underestimates the doses that would be required if the population tested in clinical trials were representative of the patient population at large. Roche’s intent is to set its price “as 187 188 189 2/15/08 Bernheim Decl. Thus. regardless of the proportion of Q2W versus Q4W usage. 187 If peg-EPO were priced based on once every four week utilization. peg-EPO under Roche’s Proposal would be more costly to Medicare than EPOGEN.” 191 Evidence confirms that Roche comprehends. 188 Based on Dr. See RTX 6 (MIRCERA WAC Pricing) at R10-004974846. and intends to exploit the advantages conferred to new entrants under the current Medicare reimbursement system. because Roche excluded patients from its clinical trials with high CRP values.

2/15/08 Bernheim Decl. RTX 115 (CERA update regarding ASP Reimbursement) at R001619971. 194 By setting its WAC at a price that is up to 45% greater than the ASP for EPO. “we will not discount competitively in order to gain share in the ESRD business. 197 198 199 RTX 112 (CERA 5 Year Business Plan) at R000228626 (emphasis added). id. J. Roche can still take advantage of the glide path. 198 To this end. See Roche’s Proposal (“Roche will likely engage in contractual discounting to customers. 195 Additionally.. ¶ 9.”) (emphasis added).” 193 Roche’s Proposal does not do anything different. Senich).S. Roche’s Proposal is couched in language that promises only the possibility of savings. coupled with the ASP reimbursement mechanism itself.”199 Roche’s promises of the possibility of savings to Medicare ring hollow in the face of all the evidence of record including Roche’s own internal documents.. Senich). Id. there can be no justification. J. Roche’s Proposal does not guarantee lower prices in the long term. a “price increase can be good for both providers and manufacturers in the long run. at R000228616 (“Roche will not discount to gain share with these chains. . without any economic support or justification. Like its initial WAC pricing offer. ROCHE’S PROPOSED 20% ROYALTY WILL NOT ADEQUATELY COMPENSATE AMGEN FOR EVEN ITS ECONOMIC LOSSES.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 56 of 63 high as [it] can that payers will pay for and then glide down given the regulatory scheme. at R001619973-974. Rather. at 570:5-9 (Young. 196 But substantial savings are not likely. will likely deliver lower net costs to providers and payers. ¶¶ 10-15. Clearly. Roche’s proposal is grossly inadequate to compensate Amgen for the harms it will face if Roche is permitted to commercialize peg-EPO in the U. Roche proposes a 20% royalty rate on the net sales of peg-EPO. . From Roche’s point of view. These discounts and the competition they will engender. . 570:10-571:9 (Young. Id.. 49 . B.” 197 and that excessive price competition would result in an undesirable downward price spiral.”). Roche concluded. and it ignores that the law mandates that 193 194 195 196 12/7/07 Remedy Hr’g Tr.

200 201 35 U.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 57 of 63 injunctions should be fashioned on “principles of equity to prevent the violation of any right secured by patent. Roche’s proposed 20% royalty grossly under compensates Amgen for even the most immediate lost profits that Amgen will realize when a sale of peg-EPO displaces a sale of EPOGEN or Aranesp and leaves wholly unanswered the harm to Amgen which is not amenable to calculation with reasonable certainty. ¶ 18. there are no comparisons between Roche’s current position as an adjudged infringer and J&J’s position in 1985 when it licensed non-competing and uncertain medical indications for EPO from Amgen. 203 In contrast. using Roche’s expert’s calculations for Amgen’s unit costs and profit margin. 50 . §§ 283-284 (2007) (emphasis added).S. Roche would keep approximately 77% of the profits associated with each unit. Elhauge. 201 for every sale of peg-EPO into dialysis Amgen will lose its 89% profit margin and will receive only a 20% royalty from Roche on its net price (whatever that may be). Id. For example. 202 203 204 2/15/08 Bernheim Decl. and that any damages award must be “adequate to compensate for the infringement. 202 Assuming that EPOGEN and peg-EPO are priced equivalently on a cost-of-therapy basis.” 200 Roche’s only explanation for the 20% royalty offer is that the amount is “about double that paid currently by Johnson & Johnson for its Procrit product. estimates that Amgen’s profit margin on EPOGEN is 89%. Id. Mr. Roche has done nothing to deserve such a windfall. See RTX 42 (4/6/07 Elhauge Report) ¶ 41.” (not make it profitable for the infringer to infringe).” But as explained below. Roche’s expert.C. 204 Roche cites to no reason why it should be allowed to infringe Amgen’s patents but capture three times the profit that Amgen would make. Amgen will receive only 23% of the profits that it would have earned on each unit but for Roche’s infringement.

it is a product license agreement that grants to Ortho a limited license to sell a particular product in a limited field of use. ¶ 20. Rather. For example. Roche also ignores the other consideration given to Amgen by Ortho. Roche seeks to compete directly with Amgen across all ESA usage. granting to Amgen 205 206 207 Roche’s Proposal (emphasis removed). In addition. 8807-09. and initially fund Amgen’s internal development efforts. the structure of the relationship between Amgen and Ortho was fundamentally different than the position of Roche today. Ortho agreed to develop and expand indications in which EPO would be sold. RTX 22 (Amgen/Ortho Product License Agreement) at AM-ITC 00508749. Amgen did not license Ortho to compete with it in the dialysis indication but imposed on Ortho the risk and the costs of developing EPO for non-competing uses. This is far different from the unrestricted access that Roche is requesting to uses already established by both Amgen and Ortho. 207 Importantly. years after ESAs were established as the standard of care through the efforts and commitment of Amgen and Ortho to prove their value.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 58 of 63 Roche’s reliance on the royalty provision in Amgen’s agreement with Ortho Biotech (Johnson & Johnson’s subsidiary) and its offer to “double that paid currently by Johnson & Johnson” 205 is wholly inappropriate. In contrast. share its improvements with Amgen. 2/15/08 Bernheim Decl. 51 . 206 The position of the parties and the development risks associated with the products were radically different in 1985 as compared to today. RTX 46 (Amgen/Ortho Technology License Agreement) at AM-ITC 00508814-15. Ortho agreed that Amgen would be Ortho’s sole manufacturer. Ortho had the obligation to develop the clinical basis for the use of EPO in non-dialysis settings. At its most fundamental level. the Ortho Agreement is not a patent license agreement.

It knows that there is a substantial market for treatment of anemia in the United States. RTX 22 (Amgen/Ortho Product License Agreement) at AM-ITC 00508764. 8814-15. 211 210 By comparing its Proposal to the Ortho royalty. Roche also ignores the other consideration given to Amgen by Ortho. share its improvements with Amgen. at 34:2035:3 (Sharer). Importantly. 30. Blessed with hindsight and Amgen’s pioneering efforts. the IND for Epoetin alfa which allowed testing in humans to begin had not even been filed. The product license application for Epoetin alfa (EPOGEN) was submitted to FDA on October 30. Roche faces little comparative risk. See. Ortho agreed that Amgen would be Ortho’s sole manufacturer. It knows that EPO can be safely manufactured to treat patients with anemia. 208 The Amgen/Ortho product license was executed long-before EPOGEN or Procrit were approved for sale by the FDA. and agreed to incur risk for the possibility of a financial reward.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 59 of 63 the benefits afforded by the economies of scale. and initially fund Amgen’s internal development efforts. at the time Amgen and Ortho entered into its license. ¶ 20. and was approved by the FDA on June 1. 209 When Amgen granted the limited license to Ortho. 209 The license agreement was executed on Sept. marketing and distribution. 1985. 11/15/07 Remedy Hr’g Tr. at 34:1-11 (Sharer). It knows all of these things because Amgen and Ortho took the risk to develop and market Dr. 11/15/07 Remedy Hr’g Tr. Lin’s inventions.. Ortho agreed to develop and expand upon the potential EPO markets. 210 Indeed. Lin’s inventions are lucrative. as well as input in regulatory issues. Amgen was in need of capital in order to fund additional clinical trials. In contrast. RTX 46 (Amgen/Ortho Technology License Agreement) at AM-ITC 00508806-09. 1987. and lacked experience with clinical trials. For example. RTX 46 (Amgen/Ortho Technology License Agreement) at AM-ITC 00508806-09. e. as well as input in regulatory issues. RTX 22 (Amgen/Ortho Product License Agreement) at AM-ITC 00508764. 2/15/08 Bernheim Decl. at 1955:13-22 (Browne). 10/1/07 Trial Tr. 11/15/07 Remedy Hr’g Tr. 8814-15. RTX 22 (Amgen/Ortho Product License Agreement) at AM-ITC 00508736.g. Roche knows that Dr. 1989. Ortho agreed to provide capital. 52 . granting to Amgen the benefits afforded by the economies of scale. at 34:20-35:3 (Sharer). Amgen was in its infancy as a corporation. at 34:1-11 (Sharer). 211 208 11/15/07 Remedy Hr’g Tr.

Lin’s Patents expire allows Roche to enjoy the benefits of the patents at Amgen’s expense. As Roche’s witness. 212 Roche’s Proposal ignores that what it is asking the Court to do is punish Amgen and encourage copyists like Roche — a result that is the 180° opposite of the purpose of an injunction. ¶¶ 18-19. 2/15/08 Bernheim Decl. Any Medicare savings would be based on losses to Amgen. or desire to reduce health care spending while laudable is not an appropriate factor to consider in weighing the public interest.S. dream. 53 . The hope. at Amgen’s expense. and Roche will gain $2. testified at trial. Permitting Roche to commercialize peg-EPO in the U. it cannot possibly outweigh the public interest in encouraging innovation reflected in our nation’s Constitution and our patent laws.5 billion. 212 213 214 CONCLUSION 11/15/07 Remedy Hr’g Tr. for the $500 million in ESRD savings he says Medicare will receive. sales gained by Roche will be taken from Amgen (or Ortho. IV. And even if it were. Such an outcome rewards Roche for infringing Amgen’s patents. That result in no way reflects an appropriate view of the public interest. Mr. before Dr. THE PROVEN INNOVATOR.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 60 of 63 C. Elhauge. at 672:4-673:12 (Elhauge). 213 Nothing in Roche’s Proposal changes this fundamental dynamic. Amgen will lose $3 billion. at 102:10-103:5 (Bernheim). Roche will not gain share by significantly expanding the demand for ESAs in the treatment of anemia of chronic renal failure (the only indication for which peg-EPO is approved). AND AWARD THEM TO ROCHE FOR ITS INFRINGEMENT — ALL IN THE NAME OF THE PUBLIC INTEREST. 214 Roche is asking this Court to take Amgen’s rightful profits and award them to Roche for its infringement — all in the name of the public interest. ROCHE IS ASKING THE COURT TO TAKE THE PROFITS OF AMGEN. Amgen’s licensee). 12/7/07 Remedy Hr’g Tr.

. WHITEFORD MONIQUE L. Of Counsel: STUART L. DOTSON KIMBERLIN L. Under the facts before the Court. (pro hac vice) DAY CASEBEER MADRID & BATCHELDER LLP 20300 Stevens Creek Boulevard. any other remedy would only encourage infringement rather than deter and would thereby disserve the principles underlying injunctions. WATT WENDY A. OLSON AMGEN INC. FLOWERS (pro hac vice) MARSHALL. MA 02210 Telephone: (857) 488-4200 Facsimile: (857) 488-4201 mrgottfried@duanemorris. GERSTEIN & BORUN LLP 54 .com LLOYD R. JR. Suite 500 Boston. DAY. CA 95014 Telephone: (408) 873-0110 Facsimile: (408) 873-0220 WILLIAM GAEDE III (pro hac vice) McDERMOTT WILL & EMERY 3150 Porter Drive Palo Alto. CA 94304 Telephone: (650) 813-5000 Facsimile: (650) 813-5100 KEVIN M. CA 91320-1789 (805) 447-5000 _/s/ Michael R. Gottfried _______ MICHAEL R. GOTTFRIED (BBO#542156) D. AMGEN INC. Suite 400 Cupertino. MORLEY ERICA S. DENNIS ALLEGRETTI (BBO#545511) PATRICIA R. Respectfully Submitted. CORDRAY DARRELL G. RICH (BBO#640578) DUANE MORRIS LLP 470 Atlantic Avenue. One Amgen Center Drive Thousand Oaks. Roche should be permanently enjoined from commercializing its infringing peg-EPO product in the United States. By its attorneys.Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 61 of 63 Amgen has shown that each of the four factors considered under eBay favor issuance of a permanent injunction and that Roche’s allegations of unclean hands and patent misuse are without merit. As such.

Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 62 of 63 233 South Wacker Drive 6300 Sears Tower Chicago IL 60606 Telephone: (312) 474-6300 Facsimile: (312) 474-0448 February 19. 2008 55 .

filed through the ECF system will be sent electronically to the registered participants as identified on the Notice of electronic filing and paper copies will be sent to those indicated as non-registered participants. Gottfried Michael R.com 901658_4 1 .Case 1:05-cv-12237-WGY Document 1656 Filed 02/19/2008 Page 63 of 63 CERTIFICATE OF SERVICE I hereby certify that this document. Gottfried mrgottfried@duanemorris. /s/ Michael R.

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