By Suresh Pillai —

Capricorn Keeps Zicam® IP Suit Active, But Loses
Bid for Inventorship Change

The U.S. District Court for the District of
Delaware has ruled that Capricorn Pharma, Inc. can proceed
with its suit against Matrixx Initiatives Inc. for allegedly infringing Capricorn's patent covering Zicam®, a cold medication.  The patent-in-suit, U.S. Patent No.
6,375,982,
covers rapid semi-solid compositions and methods of making such
compositions.  In its complaint,
Capricon alleges that Matrixx infringed the '982 patent following the expiration of a manufacturing
agreement between the two companies, under which Capricorn had used its
proprietary technology to manufacture RapidMelt® disintegrating tablets that
would be sold under the Zicam® brand by Matrixx.  At the time, Matrixx had knowledge of the technology, and
Capricorn has alleged that Matrixx was bound by non-disclosure terms in the
agreement not to disclose this technology.  However, after the agreement was executed, Matrixx, through
Zicam® LLC, filed two provisional patent applications which, according to
Capricorn, contained its proprietary and confidential information.

In the latest action, Matrixx attempted to dismiss
Capricorn's claims of breach of contract, specific performance, misappropriation of trade
secrets, fraud, and negligent misrepresentation under the reasoning that
such claims were time barred under a three-year statute of limitations.  Capricorn countered Matrixx's arguments
by stating that Matrixx had fraudulently concealed its misappropriation of
trade secrets and breach of the manufacturing agreement, thereby negating the
application of the statute of limitations.  Capricorn also sought to correct inventorship on a pending
patent application related to the '982 patent.

Though the District Court sided with Capricorn on the
statute of limitations issue, the Court refused to correct inventorship,
holding that such changes were under the exclusive control of the U.S. Patent and Trademark Office.

Bayer Suit over Nexavar® Dismissed

The Delhi (India) High Court has dismissed Bayer
HealthCare AG's
lawsuit challenging Cipla Ltd.'s
application with the Drugs Controller General of India to market and
manufacture Nexavar® in India.  Currently, Bayer holds Indian patent protection for Nexavar® until 2020;
the patent was granted in 2008, and Cipla filed its opposition to that patent
this past April.  In spite of Bayer's patent, the Indian Court held that Bayer was "attempting
to tweak public policy" and that Bayer's lawsuit was "vexatious"
in nature.  Nexavar is an oral
anti-cancer therapy that has been approved in numerous countries for the
treatment of liver cancer and advanced kidney cancer.

Bayer's attempt was viewed by the Indian Court as a means
to link the patent process with that of regulatory approval by preventing
generic companies from utilizing the drugs for efficacy tests in anticipation
of generic production, thereby lengthening the amount of time required to get
the generics on the market.

Mylan Appeals Federal Court Validation of Benicar®
Patent

Mylan Pharmaceuticals Inc. has filed a notice of appeal in the U.S.
District Court for the District of New Jersey, formally objecting to the Court's
ruling that Mylan had infringed on Daiichi Sankyo Co. Ltd.'s patent covering
Benicar® and Azor®, two drugs for the treatment of hypertension (see
"Biotech/Pharma Docket," August 11, 2009).  The patent-in-suit, U.S. Patent No.
5,616,599,
covers the active ingredient in both drugs.  Sankyo Co. Ltd., the owner of the patent, and Daiichi Sankyo
Inc., its American licensee, originally filed suit in 2007 following Mylan's
filing of an ANDA seeking FDA approval to make and market a generic version of
Benicar® prior to the expiration date of the patent (see "Court Report," July 9,
2007).  A second suit was filed in 2008
following Matrix Laboratories Inc.'s
submission of an ANDA seeking FDA regulatory approval to market a generic
version of Azor®.

At trial, the District Court held the patents to be valid, and dismissed Mylan's counterclaims of noninfringement and invalidity.  The Court enjoined Mylan
from producing generic versions of both drugs until after the patent expires
in April 2016.