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  • Genentech, Inc. v. Hospira, Inc. (Fed. Cir. 2020)

    By Kevin E. Noonan —

    Federal Circuit SealLast week, the Federal Circuit affirmed invalidation of claims to methods for reducing Protein A leaching in affinity column chromatographic methods important inter alia in purifying monoclonal antibodies, in Genentech, Inc. v. Hospira, Inc.  In doing so, the panel majority (over a dissent by Judge Newman) illustrated anew the importance of the deference the U.S. Patent and Trademark Office (and particularly the Patent Trial and Appeal Board) is due under the Administrative Procedures Act, and how that deference can be outcome determinative under the right circumstances.

    The case arose before the PTAB in an inter partes review (IPR) of U.S. Patent No. 7,807,799, which claimed methods for purifying antibodies comprising a CH2/CH3 region using Protein A affinity chromatography.  The claimed methods are directed to an improvement wherein the amount of Protein A contaminant in the antibody eluate is minimized (substantially to zero).  The opinion characterized the claimed method as a "standard purification technique," relying on high affinity, reversible binding to CH2/CH3 regions, which methods were capable of "reducing leaching of protein A . . . by reducing [the] temperature" of the "composition that is subjected to protein A affinity chromatography."  The inventors found that leaching can be minimized by performing chromatography at temperatures between 10-18°C (the specification also disclosing a broader range of 3-20°C).  Claim 1 of the '799 patent is representative:

    A method of purifying a protein which comprises CH2/CH3 region, comprising subjecting a composition comprising said protein to protein A affinity chromatography at a temperature in the range from about 10°C to about 18°C.

    The primary references asserted by Hospira in its IPR was International Publication No. WO 95/22389 and a scientific reference contributed by van Sommeren and colleagues to a treatise entitled Effects of Temperature, Flow Rate and Composition of Binding Buffer on Adsorption of Mouse Monoclonal IgG1 Antibodies to Protein A Sepharose 4 Fast Flow, 22 PREPARATIVE BIOCHEMISTRY 135 (1992), as well as other secondary references that were applied in combination with the '389 PCT publication for the Board's obviousness determinations.  The '389 PCT publication disclosed Protein A purification of antibodies performed at room temperature, defined as 18-25°C, which overlapped with the '799's temperature range of from about 10°C to about 18°C.  The Board held all claims in IPR (1-3 and 5-11) to be anticipated by the '389 PCT publication or obvious in light of the '389 PCT publication or the van Sommeren reference as primary reference, in combination with other secondary references.  Genentech appealed and also challenged the constitutionality of applying IPRs retroactively in view of the '799 patents priority date; the Federal government intervened to address this issue on appeal.

    The Federal Circuit affirmed, in an opinion by Judge Chen joined by Chief Judge Prost; Judge Newman dissented.  Regarding the Board's anticipation decision, the Federal Circuit relied on the overlap of the temperature ranges, on the basis that the method disclosed in the '389 PCT publication was directed to purifying antibodies comprising the CH2/CH3 region and included a Protein A purification step performed at room temperature, defined in the specification as the range of 18-25°C.  The Federal Circuit's opinion  states that "[a] prior art reference that discloses an overlapping but different range than the claimed range can be anticipatory, even where the prior art range only partially or slightly overlaps with the claimed range," citing Ineos USA LLC v. Berry Plastics Corp., 783 F.3d 865, 870–71 (Fed. Cir. 2015).  The question that a court must answer, according to the opinion, is "whether the patentee has established that the claimed range is critical to the operability of the claimed invention," citing Ineos and E.I. DuPont de Nemours & Co. v. Synvina C.V., 904 F.3d 996, 1008 (Fed. Cir. 2018).  The Board found that Genentech had not carried this burden and (curiously, perhaps) Genentech did not challenge this finding on appeal.

    The Board also found that the '389 PCT publication taught that Protein A column chromatography was performed throughout at room temperature (18-25°C, i.e., the overlapping temperature range).  Genentech attempted to challenge this interpretation on the ground that "room temperature" as disclosed in the '389 PCT publication was precisely that, the temperature of the room in which the chromatography was performed and not the temperature of the components, buffers, etc. used in the purification.  Genentech based this argument in part on the temperature of the source material to be subjected to chromatography (i.e., antibody preparations from cells cultured at 37°C) in the absence of instructions in the '389 PCT publication to cool this material to "room temperature" and relied on testimony from its expert.  Hospira's expert, on the contrary, argued that those of skill in the art would perform chromatography at "ambient" (room) temperature.  The Federal Circuit majority held that "substantial evidence supports the Board's finding that the HCCF subject to protein A affinity chromatography in WO '389 is within the claimed temperature range of claim 1."  The majority identified portions of Genentech's expert's testimony that it disagreed with (correctly, in the majority's view) and held that "to the extent the experts disagreed with one another, the Board reasonably chose to credit the testimony of [Hospira's expert] over the testimony of [Genentech's expert], another instance where the deference the Court is mandated to give fact questions to the Board under Dickinson v. Zurko was dispositive.  The Federal Circuit majority also rejected Genentech's argument that the Board's decision was contrary to the Court's precedent (thus converting the issue to a question on law) and affirmed the Board's determination that Genentech's claims were invalid for anticipation by the disclosure in the '389 PCT publication.

    Turning to the Board's decision that the claims were also obvious over the combination of the disclosure of the '389 PCT publication in combination with a variety of other prior art references, the panel majority relied on their precedent that "[i]f the relevant comparison between a disputed claim limitation and the prior art pertains to a range of overlap-ping values, 'we and our predecessor court have consistently held that even a slight overlap in range establishes a prima facie case of obviousness,'" citing In re Peterson, 315 F.3d 1325, 1329 (Fed. Cir. 2003).  This has the effect of raising a presumption of obviousness, according to the opinion, thus shifting the burden on the patentee to rebut the presumption (which the Board held Genentech did not do and the panel majority affirmed).  Genentech neither showed that the temperature range was critical to the invention nor that the prior art did not recognize temperature as being "result-effective" (two ways to achieve the required rebuttal).  This latter stratagem was ineffective in the Board's view because the prior art understood Protein A leaching to be the result of proteolysis, and that proteolysis was affected by temperature.  Moreover, according to the Court, "[t]he Board reasonably found that a skilled artisan would have been motivated to optimize the temperature given the teachings of the prior art, and that given the ease with which temperature can be varied, finding an optimal temperature range would have been nothing more than routine experimentation."  The panel majority rejected Genentech's argument that the purported desire to reduce Protein A leaching was relevant only in large-scale, industrial applications of the technique, not at least because Genentech's claim was not limited to these circumstances.

    Finally, the Board held that the objective indicia of nonobviousness did not change their conclusion that Genentech's claims were obvious, and the panel majority affirmed this determination.

    The majority's opinion closes with the Court's rejection of Genentech's challenge that inter partes review are an unconstitutional violation of the Fifth Amendment (for reasons substantially identical to the Court's earlier opinion in Celgene Corp. v. Peter, 931 F.3d 1342, 1356–63 (Fed. Cir. 2019)), nor the Seventh Amendment nor Article III.

    Judge Newman dissented, on the basis inter alia that the invention had actually solved a real world problem and that the majority's affirmance ignored the value the invention brought to the art.  "The court presents a hindsight determination that this apparently simple solution to a difficult problem is anticipated and obvious, although it was not known or obvious to the scientists who were attempting to solve the problem of leaching contamination, and the experts for both sides agreed that the solution presented in the '799 patent was new to them," Judge Newman writes.  She sees the complexities involved in arriving at this solution, and the failure in the art to disclose the solution rebuts, for the Judge the Board's invalidation on anticipation and obviousness grounds.  On the merits, Judge Newman discounts the overlap at 18°C as supporting anticipation, because her understanding of the law would require the temperature range disclosed in the  '389 PCT publication (18-25°C) to be the same as the claimed temperature range (10-18°C).  And Judge Newman rejects the "optimization" basis for the Board's obviousness determination (and the majority's affirmance), stating that:

    [T]he question is not whether it would have been easy to cool the material to the 10°C – 18°C range; the question is whether it would have been obvious to do so.  Contrary to the Board's and the court's view, this is not a matter of optimizing a known procedure to obtain a known result; for it was not known that cooling the material for chromatography would avoid contamination of the purified protein with leached protein A.

    Genentech, Inc. v. Hospira, Inc. (Fed. Cir. 2020)
    Panel: Chief Judge Prost and Circuit Judges Newman and Chen
    Opinion by Circuit Judge Chen; dissenting opinion by Circuit Judge Newman

  • Hospira, Inc. v. Fresenius Kabi USA, LLC (Fed. Cir. 2020)

    By Kevin E. Noonan —

    Federal Circuit SealIt seems that memes can be as compelling in the law as in social media, and the meme of the moment in patent law is inherency, particularly as applied to obviousness determinations (see, for example, Persion Pharmaceuticals LLC v.  Alvogen Malta Operations Ltd.; Acorda Therapeutics, Inc. v. Roxane Labs., Inc.).  This tendency was most recently illustrated in the Federal Circuit's decision in Hospira, Inc. v. Fresenius Kabi USA, LLC.

    The issue arose in ANDA litigation, where the District Court found claim 6 of U.S. Patent No. 8,648,106 to be obvious:

    6.  A ready to use liquid pharmaceutical composition for parenteral administration to a subject, comprising dexmedetomidine or a pharmaceutically acceptable salt thereof disposed within a sealed glass container, wherein the liquid pharmaceutical composition when stored in the glass container for at least five months exhibits no more than about 2% decrease in the concentration of dexmedetomidine, wherein the dexmedetomidine or pharmaceutically acceptable salt thereof is at a concentration of about 4 μg/mL.

    (Wherein the italicized portion of the claim is recited expressly in independent claim 1, from which claim 6 depends.)

    The claim encompasses Hospira's Precedex (dexmedetomidine) product, a sedative, first developed in the 1980's.  However, its earliest developer (Farmos) had difficulty getting FDA approval, and it was later sold by Abbott as a concentrate (at a concentration of 100 micrograms/mL) in 2mL vials, that needed to be diluted for use at a concentration of 4 micrograms/mL (the prevailing belief being that the drug was unstable at its therapeutically effective concentration.  Hospira determined that it could be prepared at the lower concentration, the inventors having discovered that the diluted formulation was stable and active over a prolonged period of time, with there being some evidence that nitrogen sparging was important to confer the stability properties.  The advantages of the invention (i.e., not needed to be dilutes at point of care) included avoidance of errors/overdose, greater convenience, and reduced frequency of contamination, among others.

    The District Court held claim 6 to be obvious over the prior art concentrate and knowledge of one having skill in the art.  The Court further depended on the 4 microgram/mL formulation being expressly taught in the prior art with the sole distinction recited in the claim being the "less than 2% degradation limitation," which the Board held was an inherent property of the 4 microgram/mL embodiment.  The District Court considered fact and expert testimony, specifically defendant expert's testimony (disputed by Hospira) regarding that the concentration of the drug had no effect on stability.  The basis for the District Court's decision was synopsized in the Federal Circuit's opinion:

    A [person of ordinary skill in the art] would have a considerable understanding of organic chemistry.  Based on his or her understanding of the chemical properties of dexmedetomidine, a [person of ordinary skill in the art] would have expected it to be stable in room-temperature storage conditions for at least five months (based presumably on evidence adduced at trial).

    The Court heard (ultimately persuasive) expert testimony that the chemical structure of dexmedetomidine would be "a rock stable molecule" under normal conditions based on its aromatic ring structure and lack of hydrolyzable and oxidizable groups.

    The Federal Circuit affirmed, in an opinion by Judge Lourie, joined by Judges Dyk and Moore.  The Court affirmed the District Court's application of the inherency doctrine as applied to its obviousness determination, noting that inherency is established in the context of obviousness when "the limitation at issue necessarily must be present, or the natural result of the combination of elements explicitly disclosed by the prior art" and that Fresenius had satisfied this standard.

    On appeal, Hospira argued that the evidence that the 2% limitation was inherent was adduced from samples made according to the patent disclosure, and thus not prior art; the weakness of this argument is that inherency almost by definition arises where the inherent property existed in the prior art but was not appreciated in the art.  The opinion notes that, as here, "extrinsic evidence can be used to demonstrate what is 'necessarily present' in a prior art embodiment even if the extrinsic evidence is not itself prior art," citing Monsanto Tech. LLC v. E.I. DuPont de Nemours & Co., 878 F.3d 1336, 1345 (Fed. Cir. 2018), and Schering Corp. v. Geneva Pharm., Inc., 339 F.3d 1373, 1377 (Fed. Cir. 2003).  In addition, the opinion states that "the work of the inventor or the patentee can be used as the evidence of inherency," citing Alcon Research, Ltd. v. Apotex Inc., 687 F.3d 1362, 1369 (Fed. Cir. 2012), and Telemac Cellular Corp. v. Topp Telecom, Inc., 247 F.3d 1316, 1327–28 (Fed. Cir. 2001).

    An important aspect of the Federal Circuit's opinion is that "[t]he inherent teaching of a prior art reference is a question of fact," Par Pharm. v. TWI Pharm., Inc., 773 F.3d 1186, 1194 (Fed. Cir. 2014), and under the standard of review for fact issues (clear error), the District Court's fact determinations are entitled to substantial (almost plenary, in practice) deference.  The opinion sets forth the importance of this deference explicitly:

    Hospira's arguments on appeal cannot change the trial record, which included more than 20 samples that all met the about 2% limitation.  The trial record also included testimonial and statistical evidence that dexmedetomidine is a very stable drug at any concentration; thus, simply adding solvent to dilute it by a factor of 25—from 100 μg/mL, which was known to be stable, to 4 μg/mL—does not affect its inherent stability.  On that record, it was not clearly erroneous for the district court to find that the about 2% limitation was necessarily present in the prior art.

    The opinion particularly notes regarding Hospira's failure to rebut the application of inherency principles that "Hospira did not present evidence of even a single sample of the 4 μg/mL preferred embodiment that failed to meet the about 2% limitation."

    Another issue Hospira raised against the District Court's decision related to the interplay between the inherency standard and obviousness determination with regard to the requirement that there be a reasonable expectation of success.  To the extent that the District Court erred the Court said it was harmless error, specifically because the Court "engag[ed] in unnecessary analysis in evaluating whether the chemical properties of the dexmedetomidine molecule, the information in the Precedex Concentrate and Dexdomitor labels, and the industry guidance for stability testing would enable a person of ordinary skill to have had a reasonable expectation of successfully achieving the about 2% limitation."  Presumably the panel's basis for this analysis of because once the inherent property is appreciated or discovered that would supply the reasonable expectation of success.

    Finally, the opinion notes that, as in many cases, disclosure in the patent specification (in hindsight) provides support for the argument that the claims are invalid:

    Here, the '106 patent itself states that the invention was based on "the discovery that dexmedetomidine prepared in a premixed formulation . . . remains stable and active after prolonged storage."  '106 patent, col. 3 ll. 6–10 (emphasis added).

    In addition to the promulgation of the idea that inherency is available to be used to support for obviousness, this decision makes clear that the Court (or some members of the Court) is of a mind to consider claims in a restrictive, rather than permissive way.  It is clear that like "mere" isolation in other contexts the discovery of novel properties, not appreciated in the prior art will be treated as inherently present in the art and thus can be used for determining obviousness.  This tendency has support in earlier Federal Circuit decisions (for example, that "[i]t is well-settled that the inclusion of an inherent, but undisclosed, property of a composition does not render a claim to the composition nonobvious," Atlas Powder Co. v. Ireco Inc., 190 F.3d 1342, 1347 (Fed. Cir. 1999)) but its extension to obviousness under the recent case law indicates that prudence suggests applicants limit statements of discoveries as the basis for their inventions and to include some evidence that claims to an invention, like this one, contain limitations that distinguish over any inherent properties (e.g., by reciting the need for treating the diluted formulation by nitrogen sparging).  Doing so might (just might) provide a basis for asserting that what provokes or illustrates the inherent property was itself not inherent and thus preclude determining that the invention is obvious.

    Hospira, Inc. v. Fresenius Kabi USA, LLC (Fed. Cir. 2020)
    Panel: Circuit Judges Lourie, Dyk, and Moore
    Opinion by Circuit Judge Lourie

  • U.S. Supreme Court on Eligibility: Nothing to See Here, Move Along

    By Kevin E. Noonan —

    Supreme Court Building #2The Supreme Court today entered orders denying certiorari in all five cases having petitions on subject matter eligibility, including Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC; Hikma Pharmaceuticals USA Inc. v. Vanda Pharmaceuticals Inc., and Berkheimer v. HP Inc.

    It can only be concluded that the Court is comfortable with the state of diagnostic method patenting (i.e., it does not exist in the U.S.).  There are members of the Court who have expressed skepticism or outright hostility to such claims, fearing that they will inhibit the practice of medicine, as well as statements (some of dubious provenance) that diagnostic methods are unlike pharmaceuticals and don't need patents (mostly from legal academics and economists).  Although Bilski was a business method patent case, some of the Justices there seemed unimpressed with method claims more generally, and this prejudice may be affecting their certiorari behavior.  And there is the animus many of the Justices have voiced about the Federal Circuit over the past 15-20 years, which may have made the Court less inclined to come to their rescue.

    Or maybe the Court believes that this decision (not to decide) will motivate Congress to change the law; after all, in Mayo, Justice Breyer said something along the lines of "if you disagree with us, go to Congress."  And genuinely, the Court may be facing up to the reality that, even if its concerns are real, the Justices don't have a solution to the problem, in which case Congress is the only answer.

    What needs to be done (although it won't be) is for the PTO and courts to distinguish in individual cases the application of the Mayo/Alice cases to come to a determination of patent eligibility.  The Court can speak in generalities all it wants, but if pressed by advocates who point out the economic consequences of the recent jurisprudence there is a chance the Court will moderate its views.  After all, the Court certainly does not want the business section of the Wall Street Journal to run the headline "Supreme Court Destroys U.S. Industry, Public at Risk, Healthcare Costs Sure to Rise."

    On the bright side, by denying cert. in Vanda, the Court kept alive the glimmer of hope that there is a way to draft enforceable claims related to diagnostics leading to real world therapeutic interventions, as well as in Berkheimer, which increases the burden on patent challengers and may inhibit plenary dismissal on eligibility grounds.

    And in view of the Court's denial of certiorari in Regents of the University of Minnesota v. LSI Corp., maybe the Court believes that the other petitioners have more compelling interests in the Court's disposition of their cases than patentees have.  This sentiment would not be inconsistent with the Court's views on patent law enunciated in many cases over the past decade.

  • Becon Medical, Ltd. v. Bartlett (E.D. Pa. 2019)

    By Donald Zuhn –-

    District Court for the Eastern District of PennsylvaniaLast month, in Becon Medical, Ltd. v. Bartlett, Senior District Judge Jan E. Dubois of the U.S. District Court for the Eastern District of Pennsylvania denied a motion to stay filed by Defendants Scott P. Bartlett, M.D. and TalexMedical, LLC ("TalexMedical").  In denying TalexMedical's motion, the District Court concluded that all three factors for determining whether to stay an action pending inter partes review weighed against granting a stay.

    Plaintiffs Becon Medical, Ltd. and Henry Stephenson Byrd, M.D. ("Becon") initiated the dispute between the parties by filing suit against TalexMedical for infringement of U.S. Patent Nos. 8,167,942 and 8,852,277, contending that TalexMedical infringed the patents by making and selling its non-surgical infant ear correction device, InfantEar (Becon makes and sells the EarWell device).  TalexMedical was served with Becon's complaint on October 10, 2018, and filed its motion to stay approximately three weeks before it requested IPR on October 9, 2019.  By the time TalexMedical requested IPR, the parties had completed fact discovery, the Court had conducted a Markman hearing, and the Court had construed the disputed claim terms.

    The District Court noted that in determining whether to stay an action pending an IPR, courts consider three factors:  (1) whether a stay would unduly prejudice or present a clear tactical disadvantage to the non-moving party; (2) whether a stay will simplify the issues in question and trial of the case; and (3) whether discovery is complete and whether a trial date has been set.  With respect to the first factor, the District Court noted that courts look to four sub-factors:  (1) the timing of the request for IPR; (2) the timing of the request for stay; (3) the status of the IPR proceedings; and (4) the relationship of the parties.

    In assessing the sub-factors to be considered with respect to the first factor, the District Court indicated that TalexMedical waited until "the last possible day before the statutory deadline" to request IPR, and that "[d]efendants offer no reason for filing their IPR petitions just before the deadline."  The Court also noted that Becon filed its Initial Infringement Contentions approximately seven months before TalexMedical filed for IPR, and that "defendants do not explain the near seven-month delay in filing for IPR after they learned of plaintiffs' infringement contentions."  In view of the above, the Court found "that the timing of defendants' request for IPR suggests that defendants are seeking an inappropriate tactical advantage," and determined that this sub-factor (the timing of the request for IPR) weighed against granting a stay.

    With respect to the second sub-factor (the timing of the request for stay), the District Court determined that because TalexMedical filed its motion to stay approximately three weeks before it filed for IPR, this sub-factor weighed in favor of granting a stay.  However, because the PTAB had not yet instituted review, and the IPR proceedings could extend into early 2021 if review was instituted, the Court determined that the third sub-factor (the status of the IPR proceedings) weighed against granting a stay.

    Moving to the fourth and final sub-factor (the relationship of the parties), the District Court began by noting that courts are reluctant to stay proceedings where parties are direct competitors because "[w]here parties are direct competitors, a patent infringer can take market share and build brand loyalty while the case is pending, and these injuries may not be recoverable in damages or later injunctive relief" (citing Zillow, Inc. v. Trulia, Inc., No. C12-1549JLR, 2013 WL 5530573, at *6 (W.D. Wash. Oct. 7, 2013)).  In this case, the Court indicated that the parties are direct competitors since they both make non-surgical infant ear correction devices that are marketed and sold to physicians, and therefore, that Becon would likely be unduly prejudiced by a stay.  The Court also noted that Becon had presented strong evidence of willful infringement, and while acknowledging that willful infringement is not traditionally considered by courts in determining whether to grant a stay (and despite noting that Becon did not move for a preliminary injunction), the Court found that the evidence of willful infringement "is relevant to the exercise of its discretion."  The Court therefore concluded that the fourth sub-factor weighed against a stay, and because three of the four sub-factors weighed against granting a stay, determined that the first factor weighed against granting a stay.

    Turning to the second factor (whether a stay will simplify the issues in question and trial of the case), the District Court noted that courts in the Third Circuit have generally held that this factor weighs against a stay when the PTAB has not yet decided whether to institute IPR proceedings.  Because the PTAB had not yet decided whether to institute IPR proceedings, the Court concluded that the second factor weighed against granting a stay.

    Finally, with respect to the third factor (whether discovery is complete and whether a trial date has been set), the District Court pointed out that while expert discovery had not yet been completed and a trial date had not yet been set, fact discovery had been completed, the Court had conducted a Markman hearing, and the Court had construed the disputed claim terms.  Thus, the District Court determined that both the Court and the parties had already expended significant resources, which weighed against granting a stay.

    Having concluded that all three factors weighed against granting a stay, the District Court therefore denied Defendants' Motion to Stay the litigation pending IPR.

    Becon Medical, Ltd. v. Bartlett (E.D. Pa. 2019)
    Memorandum by Senior District Judge Dubois

  • Program on IP Issues for Recreational Cannabis Industry

    IPLACThe Intellectual Property Law Association of Chicago (IPLAC) Young Members' Committee will be presenting a program entitled "Pot Topic: IP Issues for the New Recreational Weed Industry in Illinois" on January 22, 2020 from 5:30 to 9:00 pm (CT) at the Chicago-Kent College of Law Auditorium and Lobby in Chicago, IL.  Nicole Cosby of Fyllo, Nicole Grimm of McDonnell Boehnen Hulbert & Berghoff, Emily Tupy of Cresco Labs, and Adam Wolek of Taft Stettinius & Hollister will discuss the evolving recreational cannabis industry in Illinois and IP issues that involved companies will face going forward.

    The registration fee for the presentation is $50 (non-members), $25 (IPLAC members or seniors), or $15 (students).  Those interested in registering for event can do so here.

  • FCBA Patent Law Year in Review

    Federal Circuit Bar Association_2The Federal Circuit Bar Association (FCBA) will be offering a webcast entitled "Patent Law Year in Review 2019" on January 16, 2020 from 12:00 pm to 1:00 pm (EST).  A panel consisting of Susan Tull of Finnegan, Henderson, Farbow, Garrett & Dunner, LLP; Jill Schmidt of Genentech, Inc.; Sharonmoyee Goswami of Cravath, Swaine & Moore LLP; and Andrew R. Sommer of Greenberg Traurig, LLP will cover developments in patent law with a focus on patent law decisions from the U.S. Supreme Court and U.S. Court of Appeals for the Federal Circuit, including developments in the law of patentability, infringement, damages, design patents, and various issues that come up in PTAB trial proceedings.

    The webinar is complimentary for FCBA members, $50 for government, educator, or retired practitioners, or $175 for private practitioners.  Those interested in registering for the webcast, can do so here.

  • Webinar on PTAB Developments

    Foley & LardnerFoley & Lardner will be offering a webinar entitled "PTAB Year in Review" on January 23, 2020 from 1:00 to 2:00 pm (CT).  Jeanne Gillis, Stephen Maebius, and George Quillin of Foley & Lardner LLP will discuss the year's major developments and how they may impact practice before the PTAB going forward, and address the following specific topics:

    • 2019 Trends and Statistics
    • Recalibrating IPR Strategy Post-SAS
    •     Constitutionality of PTAB Judges
    • Motion to Amend Pilot Program (started March 15, 2019) and Interim Decisions on Motion to Amend
    • State Sovereign Immunity
    • Appeal of Institution Decision
    • Retroactively Invalidating Patents
    • Patent Eligibility for Life Science Companies – PTAB Trial Practice Guide (Updated July 2019)
    • Real Party in Interest (RPI): What's Next?

    While there is no cost to participate in the program, advance registration is required.  Those interested in attending the webinar can register here.

  • The “Ending the Diagnostic Odyssey Act of 2019”

    By Kevin E. Noonan —

    Washington - Capitol #3On January 6, 2020, a bi-partisan coalition of Senators, including Senator Collins (R-ME), Doug Jones (D-AL), Martha McSally (R-AZ), and Bob Menendez (D-NJ), introduced the "Ending the Diagnostic Odyssey Act of 2019" to permit states to use Medicaid funding for whole genome sequencing (WGS) analysis in children having certain rate diseases.  The bill is a counterpart of H.R. 4144, introduced by Rep. Scott Peters (CA-52), joined by Rep. Shimkus and Mr. Vargas, on August 2, 2019.

    The stated purpose of the bill is "[t]o enable States to better provide access to whole genome sequencing clinical services for certain undiagnosed children under the Medicaid program" and, of course, "for other purposes."  The bill purports to effectuate this legislative purpose by providing the States with an option to expressly achieve the stated objective.  This is to be done by amending Title XIX of the Social Security Act, codified at 42 U.S.C. ch.7, by inserting new section 1947, which states in pertinent part:

    [A] State, at its option as a State plan amendment, may provide for medical assistance under this title to an eligible individual for purposes of providing the individual with whole genome sequencing clinical services.  Sec. 1947 (a)

    Section (b) provides authorization for the state to pay a "health care provider" for WGS to an "eligible individual" (defined later in the bill as individuals who are "eligible for medical assistance under the State plan (or a waiver of such plan)" and are under 21 (or 20, 19, or 18 "as the state may choose" and has been "referred or admitted to an intensive care unit, or has been seen by at least 1 medical specialist, for a suspected genetic or undiagnosed disease; or is suspected by at least 1 medical specialist to have a neonatal- or pediatric- onset genetic disease") (Section 1947(f(1)).  During the first 12 fiscal year quarters (i.e., the first three fiscal years), the Federal percentage applicable to these payments would only provide 75% of the costs.  Part of the Federal support for this program includes planning grants (which shall also require a percentage of State matching funds as determined under section 1905(b) of the statute), and the State plan must establish procedures for referring any eligible individual to a health care provider qualified to provide WGS services (Sec. 1947(c)).

    The bill also contains requirements for the States (Section 1947(d)) to provide within three years of initiation a program under these provisions of the Act reports to the Administrator of the Centers for Medicare & Medicaid Services and the Administrator of the Health Resources and Services Administration on the extent to which these service "reduce health disparities" (presumably disparities existing between those who can and those who cannot afford WGS services under existing law) and the converse, "the extent to which coverage under the State plan (or a waiver of such plan) impedes the use of genetic and genomic testing that may improve clinical outcomes for eligible individuals enrolled in the State plan (or under a waiver of such plan).  Health care providers (Section 1947(e)) must report to the State "on all applicable measures for determining the quality of such service."  Finally, "whole genome sequencing" is expressly defined as:

    [T]he unbiased sequencing of all deoxyribonucleic acid bases in the genome of such individual and, if for the sole benefit of the individual, a biological parent of such individual for the purpose of determining whether one or more potentially disease-causing genetic variants are present in the genome of such individual or such biological parent; and . . . includes any analysis, interpretation, and data report derived from such sequencing.''  (Section 1947(f)(2)).

    Senator Collins's Homepage defines the "genetic odyssey" in the bill's title as the delay children with rare genetic diseases endure, which the Senator says last 5-7 years on average.  The tragedy of this odyssey is that many of these children do not live more than 5 years, making the provisions of the bill a life-and-death proposition for them.  According to the website, "[t]here are approximately 7,000 rare diseases known today; approximately 80 percent of rare diseases are genetic, and about one-half of all rare diseases affect children."  The Senator asserts that her bill is supported by over 100 patient advocacy groups, including "the Genetic Alliance, the Parent Project Muscular Dystrophy, Tuberous Sclerosis Alliance, Alström Syndrome International, Epilepsy Foundation, and the Asthma and Allergy Foundation of America."

    The bill is expected to be taken up in due course; H.R. 4144 has been referred to the House Committee on Energy and Commerce but the committee has taken no further action since August.

  • Amgen Inc. v. Amneal Pharmaceuticals LLC (Fed. Cir. 2020)

    By Kevin E. Noonan —

    Federal Circuit SealTransitional terms in patent law (conventionally, "comprising," "consisting of," and the more arcane "consisting essentially of") have their own provenance and meaning, denoting limitations that are "open" (comprising) or "closed" (consisting).  But how should a court construe instances where these terms seem to be at odds with one another?  The Federal Circuit provided an answer, at least with regard to the interplay between "comprising" and Markush group language ("selected from the group consisting of") in one of its first opinions of the New Year, Amgen Inc. v. Amneal Pharmaceuticals LLC.

    The case arose in ANDA litigation over generic versions of Amgen's Sensipar® formulation for treating "secondary hyperparathyroidism in adult patients with chronic kidney disease who are on dialysis and to treat hypercalcemia in patients with parathyroid cancer and primary and secondary hyperparathyroidism."  Amneal (and its affiliated companies), Piramal Healthcare UK Ltd., and Zydus Pharmaceuticals (and its affiliated companies) each filed an ANDA to market a generic version of the drug, and Amgen brought suit, asserting various claims of U.S. Patent No. 9,375,405 against the three defendants (claims 1, 2-4, 6, 8-12, and 14-18 against Amneal, claim 1-6 and 8-20 against Piramal, and claims 1-4, 6, 8-9, 15-17, and 19 against Zydus).  The parties agreed (for the purposes of the appeal) that claim 1 was representative:

    A pharmaceutical composition comprising:
        (a) from about 10% to about 40% by weight of cinacalcet HCl in an amount of from about 20 mg to about 100 mg;
        (b) from about 45% to about 85% by weight of a diluent selected from the group consisting of microcrystalline cellulose, starch, dicalcium phosphate, lactose, sorbitol, mannitol, sucrose, methyl dextrins, and mixtures thereof,
        (c) from about 1% to about 5% by weight of at least one binder selected from the group consisting of povidone, hydroxypropyl methylcellulose, hydroxypropyl cellulose, sodium carboxymethylcellulose, and mixtures thereof; and
        (d) from about 1% to 10% by weight of at least one disintegrant selected from the group consisting of crospovid[o]ne, sodium starch glycolate, croscarmellose sodium, and mixtures thereof,
        wherein the percentage by weight is relative to the total weight of the composition, and wherein the composition is for the treatment of at least one of hyperparathyroidism, hyperphosphonia, hypercalcemia, and elevated calcium phosphorus product.

    The District Court bifurcated proceedings and determined infringement first.  The panel opinion states that "[t]he prosecution history is particularly relevant to [this] appeal."  The relevant portions of this history involved introduction of the Markush groups in subparts (b), (c), and (d), which were not recited in the claim as filed.  The applicant introduced this language into subpart (b) and the Examiner (by Examiner's amendment) introduced the language into subparts (c) and (d) as a condition for allowance to overcome rejections over the prior art (to which the applicant acquiesced).  The significance of this history before the District Court related to whether or not the claim elements should be open to the presence of other components in formulations that would be infringing; Amgen contended such infringing formulations could comprise these unrecited components and the District Court disagreed.  According to the opinion, the District Court held that "Amgen ha[d] not overcome the very strong presumption that the Markush groups for the binder and disintegrant elements are closed to unrecited binders and disintegrants," relying on Multilayer Stretch Cling Film Holdings, Inc. v. Berry Plastics Corp., 831 F.3d 1350 (Fed. Cir. 2016).  Under this construction, the District Court found that Amneal did not infringe because its accused formulation contained as a binder Opadry Clear YS-1-7006, a product that contains hydroxypropyl methylcellulose ("HPMC"), polyethylene glycol 400, and polyethylene glycol 8000, which was not recited in subpart (c) (which recited HPMC).

    Similarly, the District Court found that Piramal's accused formulation used pregeletinized starch as a binder which the District Court held was not equivalent to povidone, a compound recited in the Markush language recited in subpart (c) of the claim.  That Amgen accepted the Examiner's amendment to obtain allowance of the claim raised prosecution history estoppel that precluded the District Court from considering any purported equivalents to the compounds expressly recited in the claim according to the District Court.

    On the other hand, the District Court found that Zydus's accused formulation was infringing under § 271(e)(2) because the function of pregelatinized starch in its formulation was as a diluent, and starch was recited as a diluent in the claim.  Thus, the District Court found Zydus literally infringed the claim.

    The Federal Circuit vacated and remanded as to the District Court's decision that Amneal did not infringe based on incorrect claim construction, but affirmed with regard to Piramal's non-infringement under the doctrine of equivalents and Zydus's literal infringement.  The opinion notes that, "as a preliminary matter," the panel needed to consider its jurisdiction over Zydus, because Zydus had pending defenses and counterclaims of invalidity against Amgen and thus the District Court's judgment was not final.  The opinion further noted, however, that Zydus's counsel at oral argument agreed to abandon these defenses should the Federal Circuit affirm the District Court's infringement decision, resolving any jurisdictional concerns.

    Regarding the District Court's claim construction, that the presence of the phrase "consisting of" in the Markush language introduced during prosecution prevented Amgen from extending its claim to formulations containing other elements, the Federal Circuit held that the District Court had "read more into Multilayer and Shire [Dev., LLC v. Watson Pharm., Inc., 848 F.3d 981, 984 (Fed. Cir. 2017)] than is properly found there."  Further the opinion states that:

    Multilayer and Shire did not hold broadly that, whenever "consisting of" Markush group language is present in a particular claim limitation, even when the limitation follows a general claim transition phrase of "comprising," all components of an accused product that perform the general function of the particular limitation must meet the requirements of that limitation, thus precluding components outside the Markush group.  No such issue was presented in those cases.  Rather, each decision held only that the terms of a particular claim limitation that used "consisting of" Markush group language were restricted to members of the Markush group.

    Here, the question before the panel was whether the "binder" and "disintegrant" limitations, written in Markush format, precluded other binders or disintegrants from being in the claimed composition (or an accused infringing embodiment thereof), and the Federal Circuit held that they did not.  The Court's explication of both Multilayer and Shire supported this conclusion (because if not, this panel could not overturn the earlier panels' decision to the contrary).  The panel finds as a "critical[] differen[ce]" here that "[t]here is no language in Amgen's claim indicating that every binder or disintegrant in the claimed formulation must be within the Markush group" because the claim also recites "at least one" of a binder or disintegrant.  Moreover, the opinion states that the remaining limitations in the claims with regard to these components "merely require that those particular binders or disintegrants meet the specified weight-percentage requirements," which the panel asserted "is not inconsistent with the overall composition containing other binders or disintegrants."  Relying on the plain meaning of the claim language (and finding that the specification and prosecution history do not mandate a different conclusion), the Federal Circuit held that the Markush language is not sufficient to support the District Court's construction that the claims do not encompass formulations containing other disintegrants or binders.

    The opinion also found it significant that the claims recite "comprising " with regard to the components contained in the claimed formulations.  Having found nothing in the expressly recited limitations that would be "inconsistent with the presence of binders and disintegrants beyond those identified in those limitations" recited in Markush language, the panel further relied on Amgen's use of the term "comprising" to "reinforce[] the conclusion that the language of those limitations is best construed not to foreclose such additional binders and disintegrants."

    Accordingly, the panel held that the claims properly construed do not preclude infringement if the accused formulation included an "additional component [that is] functionally similar to the component identified in the Markush group limitation," unless there was another basis, not found here, for such a finding.  The panel found that the District Court's claim construction was incorrect and vacated the determination that Amneal's ANDA formulation did not infringe, remanding to the District Court for further proceedings based on the panel's construction.

    The Federal Circuit also vacated the District Court's finding that Amneal's formulation, comprising Opadry, did not satisfy the claim limitation that an infringing formula comprise HPMC, holding that on remand the District Court should determine whether the amount of Opadry in Amneal's formulation comprises 1% to 5% by weight of HPMC.

    Regarding Piramal's product, the question before the Court was whether Amgen was precluded by prosecution history estoppel from a finding that this formulation infringed under the doctrine of equivalents.  The District Court found, and the Federal Circuit affirmed, that Amgen had narrowed the claims for "reasons related to patentability" by accepting the Examiner's amendment that inserted Markush language regarding the binder and disintegrant limitations.  Thus, Amgen was estopped from asserting that the Piramal formulation's pregelatinized starch was an equivalent to the expressly recited povidone in its claims (despite a paper submitted on the record during prosecution after the Examiner issued a Notice of Allowance that "[t]hese amendments have not been made in response to a prior art rejection but rather to place the claims in proper format and to better define the claimed subject matter, including equivalents").  And the panel also found unavailing Amgen's argument that these amendments were tangential to patentability because they were made to avoid the prior art.

    Finally, with regard to Zydus's product, the Federal Circuit affirmed the District Court's finding that its product would infringe Amgen's claims.  In this case, Zydus's product comprised starch as a diluent, a component expressly recited amongst the Markush group of diluents in Amgen's claims.  The panel did not find credible Amgen's expert testimony (proffered with regard to Piramal's product and asserted by Zydus against Amgen's infringement contentions) that starch was a binder and not a diluent (on the ground that the expert proffered inconsistent testimony, changing it somewhat three times).  The panel held that the District Court did not err in it infringement finding and affirmed that Zydus's ANDA formulation literally infringed Amgen's asserted claims.

    Amgen Inc. v. Amneal Pharmaceuticals LLC (Fed. Cir. 2020)
    Panel: Circuit Judges Newman, Lourie, and Taranto
    Opinion by Circuit Judge Lourie

  • USPTO Support for Filing in DOCX Format Still a Work in Progress

    By Michael Borella —

    USPTO SealIn August, the U.S. Patent and Trademark Office announced that it planned on raising various fees.  One of those involved an additional $400 fee for non-provisional utility application filings with a PDF specification.  This fee would be avoidable if the specification was filed in DOCX format.  The USPTO's electronic filing system (EFS) has supported DOCX specification filings for over two years.

    As of the time of this writing, the USPTO has not made a final decision on this issue.  In anticipation of the fee increase, patent attorneys, agents, and paralegals have been trialing DOCX uploads.  So far, the EFS DOCX parser has proven to work well with many files, but it is rather fragile in some cases, and outright buggy in others.

    DOCX is an open standard for word processing files.  Since Microsoft Word 2007, it has been the default choice for the save format of that application.  Unlike the proprietary DOC files that Microsoft Word used to produce, DOCX files are structured in XML.  This makes them more portable between word processing applications and easier to parse.

    The USPTO justified its encouragement of DOCX adoption based on the format's ability to facilitate instant feedback in EFS regarding common document errors, improved searchability, metadata removal, and general compatibility.  Behind the scenes, it is likely that the USPTO intends to automate some of its application intake processes, such as automatically detecting the number and type of claims and classifying applications into art units.

    We have been testing the USPTO's DOCX upload options in EFS.  What we found was not particularly encouraging.  Most notable was that EFS will often reject a DOCX specification upload, stating that it found one or more particular types of errors in the application file.  But upon inspection, we found that the indicated errors frequently did not exist.  Instead, the parser flags false positives when it encounters legitimate formatting or content that it cannot properly handle.

    One such issue relates to font support.  For one particular application, we received dozens of error messages alleging that the file contained text in the unsupported Century font.  We thoroughly reviewed the application and determined that there was no Century characters present.  After some trial and error, we ultimately determined that this error was actually being caused by our custom Microsoft Word styles.  These styles allow the drafter to rapidly format applications so that they are consistent with one another and pleasing to the eye.  But some of our styles had been based on other styles.  Apparently this was problematic, because the errors went away once we changed these styles to be based on "no style".

    Even worse, one of our applications kept getting rejected because it allegedly contained two or more of the specification, claims, and abstract (EFS DOCX support requires these three sections of the application be uploaded in three separate DOCX files).  Yet, the file clearly contained only the specification.  After manually removing sections of the application in a systematic fashion, we found the culprit — the USPTO's DOCX parser apparently will not accept the word "conclusion" on a line by itself.  When placed in a sentence, no problem.  But on its own, "conclusion" consistently resulted in a rejected upload.  Again, the error provided had nothing to do with the purported problem with the DOCX file.  Only after hours of manual debugging were we able to satisfy EFS.

    Needless to say, DOCX support is not ready for prime time.  Practically speaking, an attorney or agent up against a bar date may find that he or she cannot upload a reasonably-formatted DOCX file, and may be unable to address the issue in the necessary time frame due to the DOCX parser's obtuse and misleading error messages.  Instead, he or she may have to just eat the $400 fee and file a PDF.

    But that's not all.  When you can successfully upload a DOCX file, the USPTO converts it into a PDF.  Afterward, EFS provides a link to the PDF and displays the message, "The PDF(s) have been generated from the docx file(s).  Please review the PDF(s) for accuracy.  By clicking the continue button, you agree to accept any changes made by the conversion and that it will become the final submission."  This effectively puts the onus on the attorney or agent to manually check, line by line, that the USPTO's conversion from DOCX to PDF is correct.  Doing so is especially important if your application contains complex mathematical expressions or chemical formulas.

    We are not to the first to point out some of these issues.  I highly recommend an article by Carl Oppedahl criticizing the USPTO's implementation of DOCX.

    While the USPTO may have legitimate reasons for transitioning to DOCX, the fundamental defects in the DOCX parser reflect a lack of adequate software quality assurance.  Thus, it needs to address these problems before imposing the $400 fee on non-DOCX specification filings.  If anything, the USPTO's attempt to reduce its application intake burden currently transfers much of that burden to individuals preparing the applications.