Part 1: 2024 Hatch-Waxman Year in Review

In today's episode, first in a two part series, we’re going to unpack the year in review for the Hatch-Waxman Act—a critical framework in the pharmaceutical industry that continues to shape the dynamics between brand-name drugmakers and generics.  

2024 has been a fascinating year, with significant trends and legal shifts that have implications for innovation, accessibility, and regulatory strategy. Whether you’re a legal professional, a business leader in pharma, or simply interested in the interplay between patents and healthcare, this episode will give you key insights into what shaped the legal landscape this year. 

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2024 Hatch-Waxman Year in Review

About the authors
Ben Bourke
Alexander P. Wharton

Transcript

Welcome to Womble Perspectives, where we explore a wide range of topics, from the latest legal updates to industry trends to the business of law. Our team of lawyers, professionals and occasional outside guests will take you through the most pressing issues facing businesses today and provide practical and actionable advice to help you navigate the ever changing legal landscape.

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Welcome to Womble Perspectives, where we share updates and insights on the latest legal developments. In today's episode, first in a two part series, we’re going to unpack the year in review for the Hatch-Waxman Act—a critical framework in the pharmaceutical industry that continues to shape the dynamics between brand-name drugmakers and generics.  

2024 has been a fascinating year, with significant trends and legal shifts that have implications for innovation, accessibility, and regulatory strategy. Whether you’re a legal professional, a business leader in pharma, or simply interested in the interplay between patents and healthcare, this episode will give you key insights into what shaped the legal landscape this year.  

And don’t worry—we’ll keep things clear and actionable for everyone, no matter your level of familiarity with the Hatch-Waxman framework.  

First, a quick refresher on why the Hatch-Waxman Act remains vital nearly four decades after it was enacted. It’s all about balance—on the one hand, it incentivizes innovation by granting market exclusivity to brand-name drugmakers. On the other, it facilitates generics entering the market through mechanisms like Abbreviated New Drug Applications (ANDAs).  

This legal framework isn’t just a relic—it drives modern legal battles and regulatory policies in the pharmaceutical world. Without it, our market might lack affordable generics, or innovators might not have the protections they need to justify billions in R&D investments.  

But in 2024, Hatch-Waxman didn’t just "maintain the balance"—it played out across 312 cases, a rise from 259 in 2023, with a particular focus on jurisdictions like Delaware and New Jersey. Why these jurisdictions? They’re hubs for pharma—many companies are either incorporated in Delaware or headquartered in New Jersey. Judges in these courts are steeped in the nuances of Hatch-Waxman litigation, which makes them hugely influential in how these cases evolve.  

This brings us to the bigger question for 2024—how has the legal needle moved?  

Now, for some hard data. Hatch-Waxman litigation saw 312 new filings in 2024, with 283 ongoing cases either resolved or terminated. A couple of trends stand out in the numbers.

First up, declining settlements. Settlement rates in 2024 were noticeably lower—39% compared to 50% in 2023. This is significant because it means more cases are going through the courts, and outcomes often lean in favor of brand-name drugmakers. Innovators prevailed on issues 20% of the time, compared to just 2% for generic companies.  

Why? Well, many generics tend to settle when faced with a likely unfavorable judgment. It’s a strategic choice—fighting long-term litigation can get expensive.  

2024 also showed trends in trial outcomes. When cases did go to trial, findings of infringement were more frequent than non-infringement, and patent validity held up more often than not. Interestingly, the small number of patents ruled invalid were primarily on grounds of obviousness. 

And finally, we'll touch on jurisdictional trends. Nearly half of all Hatch-Waxman cases filed in 2024 were assigned to just five judges across Delaware and New Jersey. Specialized judges mean consistency, experience, and familiarity with the unique complexities of ANDA cases—a key advantage for litigants.  

This brings us to another area that shaped 2024—Federal Circuit decisions.  

The Federal Circuit saw an uptick in Hatch-Waxman-related rulings last year, jumping to seven decisions, compared to five in both 2023 and 2022. Next week, we'll dig deeper into some of 2024's significant cases and why they matter. But, for now, let's touch on two of the most impactful cases.

First up: Edwards Lifesciences v. Meril Life Sciences  

This case revolved around the "safe harbor" provision, a critical aspect of Hatch-Waxman that protects pre-approval activities from patent infringement. The court upheld that even demo products brought to conferences for recruitment purposes can fall under this safe harbor.  

What does this mean for practitioners? It solidifies peace of mind for innovator companies during early product development stages, but be cautious—this protection diminishes post-FDA approval. 

And second, Salix Pharmaceuticals v. Norwich Pharmaceuticals 

This case highlighted two key issues. First, the court maintained stringency for polymorph patents, finding certain claims obvious due to prior art. Secondly, it rejected attempts by ANDA filers to amend applications post-trial to circumvent infringed patents.  

Key takeaway for generics? Tactical maneuvers post-trial to expedite market entry are no longer viable, setting a high bar for future cases.  

Alongside these decisions, broader industry trends like the FDA’s labeling policies and proposed legislative amendments—such as the Skinny Labels, Big Savings Act—hint at potential regulatory shifts in 2025.  

What does this mean for the future of the pharma industry? There are a few key implications to consider. First, the Federal Circuit’s rulings highlight the need for strategic intellectual property management. It’s crucial for innovators to proactively manage their patent portfolios and strengthen protections, especially for high-value drugs. For generics, the landscape is becoming more challenging due to stricter court rulings. However, they must continue to innovate their strategies around ANDA filings, particularly for section viii carve-outs. Lastly, regulatory changes are on the horizon. With the FDA and USPTO actively considering public input, and potential legislation around experimental use and skinny labels expected by 2025, the competitive landscape could undergo significant changes.

That wraps up part one of our 2024 Hatch-Waxman Year in Review. From rising litigation numbers to significant Federal Circuit rulings, it’s clear that this legal landscape continues to evolve, challenging both innovators and generics alike.  

Next week, we'll discuss three important cases from 2024 and what they mean for the pharmaceutical industry. If you'd like to dig deeper into what we covered in today's episode, follow the link in the show notes.

Thank you for listening to Womble Perspectives. If you want to learn more about the topics discussed in this episode, please visit The Show Notes, where you can find links to related resources mentioned today. The Show Notes also have more information about our attorneys who provided today's insights, including ways to reach out to them.

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