Patent Docs

Amgen v. Sandoz Update — Amgen’s Continuing Efforts to Obtain Preliminary Injunction

April 28, 2015

By Andrew Williams —

Amgen is once again seeking a preliminary injunction in the Amgen v. Sandoz case, this time at the Federal Circuit while that Court resolves the issues on appeal from the District Court. Sandoz has only agreed to stay off the market until May 11, 2015. Therefore, this may be Amgen's last opportunity to forestall the launch of the first biosimilar drug product in the U.S.

As background, in 2014, Sandoz became the first company to file a BLA pursuant to the Biologics Price Competition and Innovation Act's ("BPCIA") abbreviated pathway found at 42 U.S.C. § 262(k). This application was for approval to market a biosimilar version of Amgen's NEUPOGEN^® (filgrastrim) drug. However, despite availing itself of this pathway for FDA approval, Sandoz refused to participate in the patent resolution component (the disclosure and information exchange provisions, also known affectionately as the "patent dance"), alleging that it was not a mandatory component. Amgen disagreed, but was disadvantaged without access to Sandoz's application and manufacturer information as contemplated by the BPCIA. Amgen's material U.S. patents on filgrastim had already expired, but it was in possession of approximately 400 other patents that could cover the manufacturing of the biosimilar drug. Nevertheless, without access to Sandoz's information, Amgen could not definitely identify which patents would be implicated. Therefore, it filed suit on October 24, 2014, requesting in part an injunction to prevent Sandoz from marketing Zarxio^TM. Amgen followed this up with a preliminary injunction in District Court to prevent Sandoz from entering the market before the issues can be resolved by the Court.

United States District Judge Seeborg of the Northern District of California denied Amgen's motion for a preliminary injunction, ruling that the disclosure and notice provisions of the BPCIA were not mandatory. The Court entered final judgment on March 25, and two days later Amgen filed an appeal with the U.S. Court of Appeals for the Federal Circuit. Amgen also sought another preliminary injunction from the District Court pending appeal, or in the alternative, an injunction lasting until the Federal Circuit can rule on the appeal of such an order. Not surprisingly, the Court denied the motion on both grounds on April 15, 2015.

Two days later, on April 17, 2015, Amgen filed an emergency motion for an injunction pending appeal pursuant to Fed. R. App. P. 8(a). To grant this motion, the Federal Circuit will need to determine "(1) whether the movant has made a strong showing of likelihood of success on the merits; (2) whether the movant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceedings; and (4) where the public interest lies." Amgen asserted that it will likely succeed on the merits because the District Court erred in its interpretation of the BPCIA. Instead of balancing the interests of an applicant and a reference product sponsor ("RPS"), Amgen argued, the District Court's interpretation vitiates the benefits afforded to the RPS. This balance includes that, on the one hand, the applicants and public will benefit from the use of the RPS's data, to which it previously had a permanent and exclusive right. On the other hand, the RPS and the public benefit from the preservation of the patent system. According to Amgen, by converting the provisions of the BPCIA from mandatory to optional, the District Court "toppled the statutory balance in favor of the Applicant and allowed Applicants to game the system." Amgen also argued that the District Court erred in allowing Sandoz to give its 180-day notice of first commercial marketing before the FDA has licensed the biological product.

Amgen also alleged that the District Court's finding that the evidence was highly speculative was in error. The Court "based [its decision on the] as-yet unproven premise that Sandoz has infringed a valid patent belonging to Amgen." Instead, Amgen pointed out that the harm "arises independently from Sandoz's product entering the market on a biological license it secured without have compiled with the Patents provision of the BPCIA." Amgen also alleges that there will be price erosion absent an injunction, because (in part) it would be difficult to raise prices back to current levels because of the Medicare reimbursement rules. Amgen also believed that there will be a loss of goodwill and harm to customer relationships. Finally, Amgen asserted that, in balancing the equities, the Court should side with it, because any harm to Sandoz is its own doing. And, there is a strong public interest in encouraging investment in drug development.

Sandoz filed its opposition on April 24, 2015. Sandoz pointed out the unique nature of Amgen's request — an injunction motion pending appeal without a claim of patent infringement. Instead, according to Sandoz, the motion is based solely on the supposed violation of the procedures of the BPCIA. Sandoz also focused on the California state law claims found in Amgen's pleadings at the lower Court, even though Amgen did not highlight these claims in its motion.

With regard to the required factors, it is not surprising that Sandoz disagreed that Amgen has shown a strong likelihood of success on appeal. Sandoz has maintained throughout that the "shall" language of the BPCIA with regard to the requisite disclosures and patent dance is only mandatory to the extent that both parties wish to partake of the patent resolution provisions. If one party does not so wish to do so, the statute provides the appropriate recourse — in this case, Amgen was allowed to file an immediate declaratory judgement action. Also, Sandoz maintained that the 180-day notice of commercial marketing can occur at any time, and to hold differently would provide a RPS with a de facto extension of exclusivity. The remaining factors are too speculative, according to Sandoz. First, Amgen cannot show any purported harm, because any harm is "based on the as-yet unproven premise that Sandoz has infringed a valid patent belonging to Amgen." In addition, Sandoz pointed out that any price erosion was "highly uncertain." This also purportedly negates the goodwill harm asserted by Amgen. Moreover, Sandoz questioned Amgen's assertion of harm, because of Amgen's own decision to delay suing Sandoz until October 2014. Finally, the balance of hardships favors Sandoz, it argued, because any delay would cut into Sandoz's "head start" over two other biosimilar applicants who expect to receive approval in 2015 or early 2016, and besides, Amgen has already enjoyed a 24-year exclusivity period.

The Federal Circuit put Amgen's appeal on its calendar for June 3, 2015. Obviously, the Court will need to decide the present motion before that date to prevent Sandoz from launching in mid-May. The briefing for the appeal should be complete in the next week. We will continue to monitor the situation and provide any updates as warranted.
Biosig Instruments, Inc. v. Nautilus, Inc. (Fed. Cir. 2015)

April 27, 2015

By Kevin E. Noonan —

The Federal Circuit considered the question of indefiniteness on remand from the Supreme Court's reversal in Nautilus v. Biosig and, perhaps not surprisingly, found again that the Biosig's claims were not indefinite.

To recap, this case involves claims to heart rate monitors on exercise equipment that determine heart rate by detecting electrocardiograph ("ECG") and subtracting the confounding electromyogram ("EMG") signals. Claim 1 of U.S. Patent No. 5,337,753 is illustrative:

1. A heart rate monitor for use by a user in association with exercise apparatus and/or exercise procedures, comprising:
    an elongate member;
    electronic circuitry including a difference amplifier having a first input terminal of a first polarity and a second input terminal of a second polarity opposite to said first polarity;
    said elongate member comprising a first half and a second half;
    a first live electrode and a first common electrode mounted on said first half in spaced relationship with each other;
    a second live electrode and a second common electrode mounted on said second half in spaced relationship with each other;
    said first and second common electrodes being connected to each other and to a point of common potential . . .
    whereby, a first electromyogram signal will be detected between said first live electrode and said first common electrode, and a second electromyogram signal, of substantially equal magnitude and phase to said first electromyogram signal will be detected between said second live electrode and said second common electrode; so that, when said first electromyogram signal is applied to said first terminal and said second electromyogram signal is applied to said second terminal, the first and second electromyogram signals will be subtracted from each other to produce a substantially zero electromyogram signal at the output of said difference amplifier.

(where the italicized term "in spaced relationship" was at issue in the indefiniteness determination).

In the earlier proceedings in this litigation, the District Court had found the term "in spaced relationship" indefinite as a matter of law. The Federal Circuit reversed, using its "insolubly ambiguous" test enunciated in Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342, 1347 (Fed. Cir. 2005), to hold that the claim was amenable to construction and thus not indefinite. Relevant to its decision on remand, the Court held that "[c]onsidering the 'intrinsic evidence,' we found that it provided 'certain inherent parameters of the claimed apparatus, which to a skilled artisan may be sufficient to understand the metes and bounds of 'spaced relationship.'" But the Supreme Court rejected this standard, holding that "a patent is invalid for indefiniteness if its claims, read in light of the specification delineating the patent, and the prosecution history, fail to inform, with reasonable certainty those skilled in the art about the scope of the invention," according to the Court, and reversed and remanded for reconsideration by the Federal Circuit under this standard.

On remand the Federal Circuit again reversed the District Court's indefiniteness determination, in an opinion by Judge Wallach joined by Judges Newman and Schall. The opinion noted that its review is plenary on questions of law, such as indefiniteness, but that its review is based on how the claims are construed. For claim construction, the Federal Circuit's review falls within the framework set forth by the Supreme Court in Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 842 (2015), where conclusions of law are reviewed de novo but findings of fact ("based on extrinsic evidence") are reviewed using a "clear error" standard. However, the opinion also stated that, provided that the District Court's construction as based solely on the intrinsic evidence there are no "facts" to be found and, thus, the Federal Circuit can apply de novo review.

Regarding the question of indefiniteness, the opinion cited precedent that "words of degree" used in a claim are not per se indefinite but depends on "whether the patent provides 'some standard for measuring that degree.'" Enzo Biochem, Inc. v. Applera Corp., 599 F.3d 1325, 1332 (Fed. Cir. 2010); Seattle Box Co., Inc. v. Indus. Crating & Packing, Inc., 731 F.2d 818, 826 (Fed. Cir. 1984). Nor did the panel believe that the Supreme Court's Nautilus decision was to the contrary, as the Court stated in Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1370 (Fed. Cir. 2014) ("Claim language employing terms of degree has long been found definite where it provided enough certainty to one of skill in the art when read in the context of the invention.") Moreover, the opinion asserted that whether a claim limitation recited in functional language was indefinite was "highly dependent on context," i.e., the disclosure in the specification and the knowledge of those skilled in the art, citing Halliburton Energy Servs., Inc. v. M-I LLC, 514 F.3d 1244, 1255 (Fed. Cir. 2008).

The panel acknowledged that the Supreme Court had changed the standard in Nautilus, but also referenced the Court's recognition of "competing interests" (i.e., the inherent ambiguities in language and the need for sufficient certainty for the claims to satisfy their notice function), as well as the policy consideration that the definiteness requirement counters "powerful incentives to inject ambiguity into [patent] claims." These considerations resulted, according to the panel, in the "reasonable certainty" standard that the Supreme Court mandated the Federal Circuit to apply in this case.

Turning to the claims on appeal, the opinion sets forth the parties' reasoning, wherein Nautilus contended that the Supreme Court set out a "new, stricter standard" which requires the Federal Circuit to affirm the District Court's indefiniteness conclusion. According to Nautilus, the intrinsic evidence "point[s] in two opposite directions" and thus the claims are indefinite. Biosig, on the other hand, argued that "reasonable certainty" is not a new standard but rather requires a "degree of clarity" consistent with a century of precedent and that the Federal Circuit's enunciation of its insolubly ambiguous standard "could send the wrong message to district courts and the patent bar."

With regard to the "reasonable certainty" standard, the panel cite (in footnotes) copious precedent for "reasonableness" in its own, Supreme Court, and other courts' cases far afield of patent law (including Palsgraf v. Long Island R.R. Co., 162 N.E. 99 (N.Y. 1928)), and then turned to how it had interpreted the "reasonable certainty" standard in DDR Holdings, LLC v. Hotels.com, 773 F.3d 1245, 1260–61 (Fed. Cir. 2014), and Interval Licensing in particular:

We do not understand the Supreme Court to have implied in Nautilus [II], and we do not hold today, that terms of degree are inherently indefinite. . . . Although absolute or mathematical precision is not required, it is not enough as some of the language in our prior cases may have suggested to identify "some standard for measuring the scope of the phrase." . . . The patents' "unobtrusive manner" phrase is highly subjective, and, on its face, provides little guidance to one of skill in the art. . . . The patents contemplate a variety of stimuli that could impact different users in different ways. As we have explained, a term of degree fails to provide sufficient notice of its scope if it depends on the unpredictable vagaries of any one person's opinion.

With these precedents in mind, the panel concluded that Biosig's claims were not indefinite. The opinion reminds that the Court did not express an opinion regarding whether Biosig's claims were indefinite (and thus, impliedly, that it was not constrained by that decision to come to a different conclusion under the Court's standard). The opinion also asserts that the District Court had relied entirely on the intrinsic evidence in construing the claims related to rendering its indefiniteness determination, and thus that its review was entirely de novo.

Returning to the grounds for its earlier decision reversing the District Court, the panel states that "[w]e noted an ordinarily skilled artisan would be able to determine this language requires the spaced relationship to be neither infinitesimally small nor greater than the width of a user's hands." Further:

[T]he district court is correct that the specification of the '753 patent does not specifically define "spaced relationship" with actual parameters, e.g., that the space between the live and common electrodes is one inch. Nevertheless, the '753 patent's claim language, specification, and the figures illustrating the "spaced relationship" between the live and common electrodes are telling and provide sufficient clarity to skilled artisans as to the bounds of this disputed term. For example, on the one hand, the distance between the live electrode and the common electrode cannot be greater than the width of a user's hands because claim 1 requires the live and common electrodes to independently detect electrical signals at two distinct points of a hand. On the other hand, it is not feasible that the distance between the live and common electrodes be infinitesimally small, effectively merging the live and common electrodes into a single electrode with one detection point. See '753 patent col. 3 ll. 26–31 (describing how each hand is placed over the live and common electrodes so that they are "in physical and electrical contact with both electrodes").

The prosecution history was not to the contrary according to the opinion, particularly with regard to the whereby clause in claim 1 that was used during reexamination to over come rejection. This clause "describes the function of substantially removing EMG signals that necessarily follows from the previously-recited structure consisting of the elongate member, the live electrode, and the common electrode" and:

The EMG signal is detected between the live and common electrodes, which are in a "spaced relationship" with each other. Even more significantly, the PTO examiner found this function to be "crucial" as a reason for overcoming the cited prior art and confirming the patentability of the asserted claims upon reexamination. . . . Thus, the recitation of this function in claim 1 is highly relevant to ascertaining the proper bounds of the "spaced relationship" between the live and common electrodes.

The panel thus concluded:

In this case, a skilled artisan would understand the inherent parameters of the invention as provided in the intrinsic evidence. The term "spaced relationship" does not run afoul of "the innovation-discouraging 'zone of uncertainty' against which [the Supreme Court] has warned," and to the contrary, informs a skilled artisan with reasonable certainty of the scope of the claim [citing Interval Licensing, 766 F.3d at 1374 (quoting Nautilus II, 134 S. Ct. at 2130)].

Biosig Instruments, Inc. v. Nautilus, Inc. (Fed. Cir. 2015)
Panel: Circuit Judges Newman, Schall, and Wallach
Opinion by Circuit Judge Wallach
Court Report

April 26, 2015

By Sherri Oslick —

About Court Report: Each week we will report briefly on recently filed biotech and pharma cases.

Medicis Pharmaceutical Corp. v. Taro Pharmaceuticals U.S.A., Inc. et el.
3:15-cv-02841; filed April 22, 2015 in the District Court of New Jersey

• Plaintiff: Medicis Pharmaceutical Corp.
• Defendants: Taro Pharmaceuticals U.S.A., Inc.; Taro Pharmaceutical Industries, Ltd.

Infringement of U.S. Patent Nos. 8,236,816 ("2x2x2 Week Dosing Regimen for Treating Actinic Keratosis with Pharmaceutical Compositions Formulated with 3.75% Imiquimod," issued August 7, 2012), 8,299,109 ("Method of Treating Actinic Keratosis with 3.75% Imiquimod Cream," issued October 30, 2012), and 8,598,196 ("Methods of Treating Dermatological Disorders and Inducing Interferon Biosynthesis with Shorter Durations of Imiquimod Therapy," issued December 3, 2013) following a Paragraph IV certification as part of Taro's filing of an ANDA to manufacture a generic version of Medicis' Zyclara® Cream (3.75% imiquimod cream, used for the topical treatment of clinically typical, visible, or palpable actinic keratoses ("AK") of the full face or balding scalp in immunocompetent adults). View the complaint here.

Shire Pharmaceutical Development Inc. et el. v. Amneal Pharmaceuticals LLC et el.
3:15-cv-02865; filed April 22, 2015 in the District Court of New Jersey

• Plaintiffs: Shire Pharmaceutical Development Inc.; Shire Development LLC; Cosmo Technologies Limited; Nogra Pharma Ltd.
• Defendants: Amneal Pharmaceuticals LLC; Amneal Pharmaceuticals of New York, LLC; Amneal Pharmaceuticals Co. (I) PVT. Ltd.; Amneal Life Sciences PVT. Ltd.

Infringement of U.S. Patent No. 6,773,720 ("Mesalazine Controlled Release Oral Pharmaceutical Compositions," issued August 10, 2004) following a Paragraph IV certification as part of Amneal's filing of an ANDA to manufacture a generic version of Shire's Lialda® (mesalamine, used to induce remission in patients with active, mild to moderate ulcerative colitis). View the complaint here.

Glycobiosciences, Inc. v. Fidia Farmaceutici S.P.A.
1:15-cv-00592; filed April 20, 2015 in the District Court of the District of Columbus

Infringement of U.S. Patent No. 6,387,407 ("Topical Drug Preparations," issued May 14, 2002) based on Fidia's manufacture and sale of its Bionect Gel (hyaluronic acid gel, used for various skin diseases and disorders). View the complaint here.

Vivus, Inc. v. Teva Pharmaceuticals USA, Inc. et el.
2:15-cv-02693; filed April 15, 2015 in the District Court of New Jersey

• Plaintiff: Vivus, Inc.
• Defendants: Teva Pharmaceuticals USA, Inc.; Teva Pharmaceutical Industries Ltd.

Infringement of U.S. Patent Nos. 7,056,890 ("Combination Therapy for Effecting Weight Loss and Treating Obesity, issued June 6, 2006), 7,553,818 (same title, issued June 30, 2009), 7,659,256 (same title, issued February 9, 2010), 7,674,776 (same title, issued March 9, 2010), 8,580,298 ("Low Dose Topiramate/Phentermine Composition and Methods of Use Thereof," issued November 12, 2013), 8,580,299 ("Escalating Dosing Regimen for Effecting Weight Loss and Treating Obesity," issued November 12, 2013), 8,895,057 (same title, issued November 25, 2014) and 8,895,058 ("Low Dose Topiramate/Phentermine Composition and Methods of Use Thereof," issued November 25, 2014) following a Paragraph IV certification as part of Teva's filing of an ANDA to manufacture a generic version of Vivus' Qsymia® (phentermine and topiramate extended-release capsules, used as an adjunct to a reduced-calorie diet and increased physical activity for chronic weight management). View the complaint here.
Conference & CLE Calendar

April 26, 2015

April 27-29, 2015 – M&A and Strategic Alliances in the Life Sciences Industries*** (American Conference Institute) – New York, NY

April 27-28, 2015 – Paragraph IV Disputes conference*** (American Conference Institute) – New York, NY

April 30, 2015 – "Interim Guidance on Patent Subject Matter Eligibility" (American Bar Association) – 1:00 to 2:30 pm (ET)

May 12, 2015 – "Patent Prosecution: Leveraging Declarations to Strengthen Patents Against Post-Grant Proceedings" (Strafford) – 1:00 to 2:30 pm (EDT)

May 12, 2015 – 31st Annual Joint Patent Practice Seminar (Connecticut, New Jersey, New York, and Philadelphia Intellectual Property Law Associations) – New York, NY

May 19, 2015 – "Best Practices for Cost-Effective Filing of PCT and EPO Patent Applications" (Technology Transfer Tactics) – 1:00 to 2:00 pm (Eastern)

May 19-21, 2015 – EU Pharmaceutical Law Forum (Informa Life Sciences) – Brussels, Belgium

May 20, 2015 – "Never Been a Better Time (For IP) Than Right Now?" (Intellectual Property Owners Association (IPO) European Practice Committee) – London, UK

June 9-10, 2015 – Due Diligence Summit for Life Sciences (ExL Events) – Boston, MA

***Patent Docs is a media partner of this conference or CLE
Due Diligence Summit for Life Sciences

April 25, 2015

ExL Events will be holding its 2nd Due Diligence Summit for Life Sciences on June 9-10, 2015 in Boston, MA. The conference will offer presentations on the following topics:

• Organize and Support Due Diligence for Out-Licensing or Partnering (case study)
• Explore How International Due Diligence Differs (case study)
• Due Diligence and Integration Planning (case study)
• Find Your Next "Blockbuster" Drug Through Comprehensive Portfolio Assessment and Measure the Market Potential of Products
• Virtual Due Diligence and Leveraging Data Rooms
• Compose and Run a Successful Gap Analysis to Determine Strengths and Weaknesses (keynote)
• Tackle Internal Interdepartmental Pressures to Lead to Compromise and Successful Deal Execution
• Animal Health Best Practices During the Mergers and Acquisitions Process (case study)
• Strategic Use of Outside Counsel
• Successful Due Diligence Across Functional Lines Through Cross-Functional Teams (case study)
• Accurately Assessing the Patent State of the Product

In addition, a pre-conference workshop, entitled "Transaction Process Management — Coordinating Due Diligence, Including Valuation and Financial Analysis from Inception Through Completion" will be offered from 9:00 am to 12:00 pm on June 9, 2015.

An agenda for the conference can be found here. A complete brochure for this conference, including an agenda, detailed descriptions of conference sessions, and list of speakers can be obtained here.

The registration fee for the conference is $1,995 (conference alone) or $2,295 (conference and workshop). Those interested in registering for the conference can do so here.

Patent Docs is a media partner of the Due Diligence Summit for Life Sciences.
EU Pharmaceutical Law Forum

April 25, 2015

Informa Life Sciences will be holding its 24th Annual EU Pharmaceutical Law Forum on May 19-21, 2015 in Brussels, Belgium. The conference will offer presentations on the following topics:

• Feedback from the EU Commission on competition law (keynote presentation) — to be presented by a representative from DG Competition, European Commission;
• Reverse payment patent settlements;
• Examining recent EU merger control cases in the pharmaceutical industry;
• Assessing pricing: Discounts and rebates;
• Review of high profile national cases/decisions in competition law;
• Unified Patent Court: Feedback from the European Commission (keynote presentation) — to be presented by Michael Koenig, Deputy Head of Unit, European Commission;
• Unified Patent Court: Feedback from private practice;
• Cross-border relief for patent infringement – should the practice be encouraged? Lessons learned from pemetrexed;
• Understanding European patent litigation and SPC's;
• Lifecycle management with respect to IP, competition law and regulatory frameworks;
• Second medical use claims (evening seminar);
• 2015 – 50 years of EU pharmaceutical legislation — an area where law does not stand still;
• Transparency of clinical trial data, regulatory data and prices plus a review of the clinical trials regulation;
• Pricing and reimbursement and market access in the EU: Pharmaceutical and medical devices;
• The EU Data Protection Regulation — Where do we stand?
• Update on IP regulatory rights: What’s new?
• Examining unlicensed use and off-label use;
• Adaptive licensing and early access to medicines;
• Transparency with regard to the relationship with healthcare professionals;
• Innovative stakeholder (customer and patients) engagement;
• Feedback from the EU Commission on the EU regulatory framework for medical devices (keynote presentation) — to be presented by Erik Hansson, Deputy Head of Unit, EU Commission;
• IVDs and revisions to the regulation;
• Biosimilars and the regulatory frameworks (evening seminar);
• Detailing effective negotiation strategies;
• Examining commercial intellectual property issues in collaboration and licensing agreements;
• The importance of due diligence;
• Obligations to exploit;
• Assessing the financial aspects of licensing and collaboration agreements;
• Dealing contractually with 3rd party IP rights;
• The European Unified Patent from a transactional and property perspective;
• Structuring the alliance management in licensing deals: A legal and commercial perspective;
• Negotiating and drafting termination provisions; and
• Asset centric corporate structures (evening seminar).

A complete brochure for this conference, including an agenda, detailed descriptions of conference sessions, list of speakers, and registration form can be obtained here.

Registration fee packages for the forum can be found here. Those interested in registering for the conference can do so here, by e-mailing registrations@informa-ls.com, by calling +44(0) 20 7017 7481, or by faxing a registration form to +44(0) 20 7017 7823.

Patent Docs is a media partner of the EU Pharmaceutical Law Forum.
Fine-structure Genetic Mapping of Human Population in Britain

April 23, 2015

By Kevin E. Noonan —

One of the consequences of the explication of human genomic DNA by the Human Genome Project and related efforts has been a better understanding of anthropological history, i.e., how the human population has changed geographically over time. This better understanding has been set forth in broad strokes based on mitochondrial DNA differences in historical and contemporary human populations (leading to the "African Eve" hypothesis of human ancestry) as well as analyses of Y-chromosome polymorphism (or lack of it; Genghis Khan has a frightfully large number of descendants). References to this part of the human story are many and include Deep Ancestry by Spencer Wells (National Geographic: 2006), and The Seven Daughters of Eve: The Science that Reveals our Genetic Ancestry by Brian Sykes (Carrol & Graf: 2002).

Recently a group of researchers from the U.S., U.K and Australia have conducted another type of study, looking at the fine structure of human population diversity in England. These results were reported in Nature in an article entitled "The fine-scale genetic structure of the British Population," Nature 519: 304-314 (19 March 2015); doi:10.1038/nature14230. These authors* showed what the authors termed "a rich and detailed pattern of genetic differentiation with remarkable concordance between genetic clusters and geography," based on genome-wide single nucleotide polymorphism (SNP) analyses of "a carefully chosen geographically diverse sample of 2,039 individuals." The results include maps of where Anglo-Saxon influence is strongest (and where it is absent) and reveal evidence of migrations from the European continent that predate the Roman conquest. The authors also report that the non-Saxon regions of Britain were populated by "genetically differentiated subgroups" of people of Celtic ancestry possessing greater genetic diversity than heretofore appreciated.

The populations studied were from throughout Great Britain (as conventionally defined to include England, Scotland, Wales and Northern Ireland) and comprised a data set termed the People of the British Isles (PoBI). By using samples from rural areas wherein all four grandparents of living study participants lived within 80 km of each other, the authors assert that they had "effectively sample[d] DNA from the grandparents" (who had an average date of birth in 1885). The study also interrogated the same SNP patterns from 6,209 samples from ten continental European countries from 500,000 SNPs.

The authors reported that "[t]he correspondence between the genetic clusters and geography [was] striking: most of the genetic clusters are highly localized, with many occupying non-overlapping regions." As set forth in the Figure, 17 clusters were chosen for convenience of the analysis. The clustering and their integrity is shown for Cornwall and Devon, where the genetic clusters "closely match" existing county boundaries and (perhaps less surprisingly) in Orkney, the region off the northern coast of Scotland, reflecting the contributions of Norse Viking "settlers."

The article also supplies a "tree" reflecting the relationships between the clusters, which the authors describe as follows:

The coarsest level of genetic differentiation (that is, the assignment into two clusters) separates the samples in Orkney from all others. Next the Welsh samples separate from the other non-Orkney samples. Subsequent splits reveal more subtle differentiation (reflected in the shorter distances between branches), including separation of north and south Wales, then separation of the north of England, Scotland and Northern Ireland from the rest of England, and separation of samples in Cornwall from the large English cluster. There is a single large cluster (red squares) that covers most of central and southern England and extends up the east coast. Notably, . . ., this cluster remain[ed] largely intact and contains almost half the individuals (1,006) in [the] study.

The authors correctly point out that the genetic differentiation they detect is small and the differentiation between clusters is "subtle." When compared with existing European populations the genetic results showed ancestry in all clusters from western Germany, Flemish Belgium, northwestern France, Denmark, southern France and Spain. Norwegian ancestry was found disproportionately in the Orkney-derived clusters ("and to a lesser extent the clusters involving Scotland and Northern Ireland") and Swedish groups were found in the ancestry profiles of other British clusters.

The authors conclude that:

The clustering [shown inter alia in Fig. 1] is notable both for its exquisite differentiation over small distances and the stability of some clusters over very large distances. Genetic differentiation within the UK is not related in a simple way to geographical distance. Examples of fine-scale differentiation include the separation of: islands within Orkney; Devon from Cornwall; and the Welsh/English borders from surrounding areas. The edges between clusters follow natural geographical boundaries in some instances, for example, between Devon and Cornwall (boundaries the Tamar Estuary and Bodmin Moor), and Orkney is separated by sea from Scotland. However, in many instances clusters span geographic boundaries; for example, the clusters in Northern Ireland span the sea to Scotland.

These conclusions support a reconstruction about how migrations produced the modern British distribution:

The authors were able to interpret these results to give a picture about how migrations of various groups has changed over time:

[T]he earliest migrations whose descendants survive to make a substantial contribution to the present population are best captured by three groups in our European analyses, GER6 (western Germany), BEL11 (Belgium), and FRA14 (north-western France). These groups still contribute to current patterns of population differentiation []. Other European groups may reflect early migrations into the UK, but with smaller contribution, including SFS31 (southern France/Spain), at least part of DEN18 (Denmark), and possibly parts of Norway and Sweden. A subsequent migration, best captured by FRA17 (France), contributed a substantial amount of ancestry to the UK outside Wales. []Migrations represented by FRA12 essentially only affect Wales and Northern Ireland and/or Scotland. We also see clear signals of some of the known historical migrations and settlements, including the Saxons (GER3, northern Germany, and probably much of DEN18, Denmark) and the Norse Vikings (NOR53–NOR90).

Finally, these researchers applied more sophisticated genetic analytical techniques (related to the rate of decay of shared haplotype segments) to assess population admixture, and found "strong evidence (P < 0.01) that the largest Orkney cluster (Orkney 1) was influenced by a recent (about 29 generations ago, or in 1100 A.D.) admixture event with an overall contribution of ~25% of the DNA from groups in Norway."

The article also notes that the known historical migration events frequently have less of a genetic impact that might be presumed; for example, the authors reported seeing "no clear genetic evidence of the Danish Viking occupation and control of a large part of England" and "no evidence of a general 'Celtic' population in non-Saxon parts of the UK." Rather, with regard to the Celtic populations in Britain the article reports "there were many distinct genetic clusters in these [non-Saxon] regions, and the Welsh clusters "represent populations that are more similar to the early post-Ice-Age settlers of Britain than those from elsewhere in the UK."

The article closes by reminding readers that such genetic studies "can augment archaeological, linguistic and historical approaches to understanding population history" and also "complements them, in providing evidence relating to the bulk of ordinary people rather than the successful elite."

* Stephen Leslie (Murdoch Childrens Research Institute, Royal Children's Hospital, University of Melbourne, Department of Mathematics and Statistics, Victoria, Australia and University of Oxford, Department of Oncology, Oxford UK), Bruce Winney (University of Oxford, Department of Oncology, Oxford UK), Garrett Hellenthal (University College London Genetics Institute, London UK), Dan Davison (Counsyl, South San Francisco, California), Abdelhamid Boumertit (University of Oxford, Department of Oncology, Oxford UK), Tammy Day (University of Oxford, Department of Oncology, Oxford UK), Katarzyna Hutnik (University of Oxford, Department of Oncology, Oxford UK), Ellen C. Royrvik (University of Oxford, Department of Oncology, Oxford UK), Barry Cunliffe (University of Oxford, Institute of Archaeology, Oxford), Wellcome Trust Case Control Consortium 2, International Multiple Sclerosis Genetics Consortium, Daniel J. Lawson (University of Bristol, Department of Mathematics, Bristol UK), Daniel Falush (College of Medicine, Swansea University, Swansea UK), Colin Freeman (The Wellcome Trust Centre for Human Genetics, Oxford UK), Matti Pirinen (University of Helsinki, Helsinki, Finland), Simon Myers (University of Oxford, Department of Statistics, Oxford UK), Mark Robinson (University of Oxford, University Museum of Natural History, Oxford UK), Peter Donnelly (University of Oxford, Department of Statistics, Oxford UK) & Walter Bodmer (University of Oxford, Department of Oncology, Oxford UK)
A Modest Proposal (or Two)

April 22, 2015

By Kevin E. Noonan —

Any observer of the interaction between the Federal Circuit and the Supreme Court over the past decade has recognized that the Court has become increasingly critical of the Federal Circuit's patent jurisprudence and of patents and patent law in general. This attitude approaches disdain in many instances, for example when Justice Kagan declares that the U.S. Patent and Trademark Office is "patent happy," or when Justice Alito says in a published opinion that "[t]he Federal Circuit's analysis fundamentally misunderstands what it means to infringe a method patent," or when the Chief Justice states in open court "Well, [appellate courts] don't have a choice, right? They can't say, I don't like the Supreme Court rule so I'm not going to apply it, other than the Federal Circuit"" (to chuckles all around). (This situation must be particularly galling to the Federal Circuit, tasked as it is with trying to apply the Court's "less than pellucid" patent law opinions.)

The consequence of this tussle between the courts is that 30 years of relative certainty has evaporated in seemingly an instant. An honest assessment of the current level of certainty in patent law is that there is much more uncertainty concerning eligibility and enforceability of issued patents; eligibility and patentability of pending applications; and the value of patents for licensing, which negatively impacts, inter alia, technology transfer from universities and other research institutions by suppressing the bargaining power of innovators when negotiating with corporations better positioned to bring useful products to market for the benefit of the populace. And thus the reason why the Founders gave Congress the power to grant patents ("to Promote . . . Progress of . . . the Useful Arts") is thwarted for apparently no good purpose.

One strand of the Court's thinking is clear: relying on legal academic theories having little empirical support (like the "Tragedy of the Anticommons"), the Court believes that patents are like the various items of furniture in "Goldilocks": you can have too much patenting or too little patenting, as stated in the two most recent decisions related to biotech and pharma patent law:

"As we have recognized before, patent protection strikes a delicate balance between creating 'incentives that lead to creation, invention, and discovery' and 'imped[ing] the flow of information that might permit, indeed spur, invention.'"

Justice Thomas, Myriad

"Patent protection is, after all, a two-edged sword. On the one hand, the promise of exclusive rights provides monetary incentives that lead to creation, invention, and discovery. On the other hand, that very exclusivity can impede the flow of information that might permit, indeed spur, invention . . ."

Justice Breyer, Mayo v. Prometheus

And, of course, the only people who know the correct balance are the members of the Court; this didn't work with regard to pornography and it certainly does not work for patent law precisely because it is certainty-destroying (besides being impractical). Indeed, it only makes sense if the Court purposefully wishes to return to the days when Justice Jackson could correctly state that "the only valid patent is one which this Court has not been able to get its hands on." Jungerson v. Ostby & Barton Co., 335 U.S. 560, 572 (1949) (Jackson, J., dissenting)

The Court's antipathy to patents, patent law and the Federal Circuit ultimately extends (intentionally or not) to how Congress has exercised the patent power. For example, the Court seems to think that "mere" discovery is not enough, despite the explicit recitation in the statute that "[w]hosoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title." 35 U.S.C. § 101. And unlike earlier embodiments of the Court, there is little acknowledgement of or compliance with Congress's intent that "anything under the sun made by man" should be patent-eligible. This raises the question of why this is so; after all, the Court is perfectly aware of the limits of its Constitutional role, as set forth by the Chief Justice in his opinion affirming Congress's power to implement the various aspects of "Obamacare" (National Federation of Independent Business v. Sebelius, 567 U.S. ___ (2012)):

Our permissive reading of these powers is explained in part by a general reticence to invalidate the acts of the Nation's elected leaders. "Proper respect for a co-ordinate branch of the government" requires that we strike down an Act of Congress only if "the lack of constitutional authority to pass [the] act in question is clearly demonstrated." United States v. Harris . . . . Members of this Court are vested with the authority to interpret the law; we possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our Nation's elected leaders, who can be thrown out of office if the people disagree with them. It is not our job to protect the people from the consequences of their political choices.

Perhaps it is this simple: in rendering decisions on Obamacare, or the "milk" cases familiar to any first year law student studying the Commerce Clause, the Court is determining whether Congress's actions fall within the scope of an enumerated power. The right to grant patents, in contrast, is an enumerated power of Congress:

The Congress shall have the power to promote the Progress of Science and useful Arts, by securing for limited times to Authors and Inventors the exclusive Rights to their respective writings and Discoveries. U.S. Const. art. I, sec. 8, cl. 8.

And maybe the Court feels it has a responsibility to scrutinize more carefully how Congress implements this power (including how the Patent Office exercises and the Federal Circuit interprets this power). The plenary effect of this review has led us to the present state of the law; again as stated by Justice Jackson:

Reversal by a higher court is not proof that justice is thereby better done. There is no doubt that if there were a super-Supreme Court, a substantial proportion of our reversals of state courts would also be reversed. We are not final because we are infallible, but we are infallible only because we are final. Brown v. Allen, 344 U.S. 443, 540 (1953) (concurring)

It is important to keep this finality in mind when thinking about how best to address the further reaches of the Court's recent patent jurisprudence, to try to reestablish some contact between the Constitution's mandate that the patent laws promote progress and the Court's assiduous efforts to the contrary.

Taking a page from Hippocrates, it is certainly the case that whatever is done must not make the situation worse. When thinking about actions that Congress could take, the wrong approach could lead precisely to this unwanted outcome, because nothing short of a Constitutional amendment could reverse a decision negating an Act of Congress that attempted to force the Court to overrule its recent precedent. And that, of course, will never happen.

History can in this instance be a guide, and one relevant historical fact is how P.J. Federico and Giles Rich wrote the portion of the 1952 Patent Act codified as Section 103, which introduced obviousness as a statutory requirement for patentability. The concept of obviousness (stated in other terms) had been introduced into U.S. patent law by the Court in Hotchkiss v. Greenwood (1850), where the Court said:

Unless more ingenuity and skill in applying the old method . . . were required in the application of it to [the new product of the method] than were possessed by an ordinary mechanic acquainted with the business, there was an absence of that degree of skill and ingenuity which constitute essential elements of every invention. In other words, the improvement is the work of the skillful mechanic, not that of the inventor.

This language is frighteningly reminiscent of language in the Court's recent Mayo and Myriad decisions, insofar as it renders patentability categorical: if the basis for obtaining a patent is on the existence vel non of an inventor, this is not so far from the current Court's categorical decisions about the existence of an invention.

Messrs. Rich and Federico avoided this outcome by directing the Court's attention to the underlying basis for their unease about "inventions" that were the product of efforts by a mere mechanic, by drafting a requirement that the claims not be obvious (a determination based on the content of the prior art, albeit still not providing the clearest basis for making a decision on patentability). That Section 103's drafters were successful can be ascertained from the Court's first post-1952 decision on this new part of the statute:

In [Section] 103 of the 1952 Patent Act Congress added the statutory nonobvious subject matter requirement, originally expounded in Hotchkiss, which merely codified judicial precedents requiring a comparison of the subject matter sought to be patented and the prior art, tying patentable inventions to advances in the art. Although 103 places emphasis upon inquiries into obviousness, rather than into "invention," the general level of innovation necessary to sustain patentability remains unchanged under the 1952 Act.

Graham v. John Deere, 383 U.S. 1 (1966). With these precedents in mind there may be a way to find a middle course that can accommodate the Court's needs to cabin the patent right and innovators' needs for certainty in patent law. The first area is in "natural products" patenting, where the Court (for the first time) extended a preclusion against patenting for compounds that were "merely" isolated. Although the Court ostensibly rendered an extremely limited decision ("We merely hold that genes and the information they encode are not patent eligible under § 101 simply because they have been isolated from the surrounding genetic material") that hasn't been how it has been interpreted. The Court's language "suggests" (or "mandates") interpretations putting the patent-eligibility of previously patent-eligible subject matter ("merely" isolated antibiotics, antibodies, vitamins, etc.) at risk. This can be better appreciated by the effect of the PTO's decision on the patent-eligibility of 1355 (small molecule) drugs approved by the FDA between 1981-2010, wherein about 75% of antibacterial drugs and almost 80% of small molecule anticancer drugs were natural products or derivatives of natural products and would have been unpatentable under the Office's first guidance implementing the Court's decisions. This cannot be what the Court intended, and it is up to the patent community to help remedy what the Court has recently wrought.

One way to do so would be to include a new section 35 U.S.C. § 100(j):

The term "composition of matter" as used herein encompasses a chemical or other product found or derived from nature provided that the composition has been changed from its natural state in its structure, function, purity, or use.

This language might be sufficient to mollify the Court's concerns about patenting natural products, because it parallels the Court's own language in Chakrabarty, wherein the standard for patent-eligibility was that the invention is "a product of human ingenuity 'having a distinctive name, character [and] use,'" Hartranft v. Wiegmann, 121 U.S. 609 (1887). This is provided, of course, that this Court is as willing as the Court in 1966 to accept that Congress had within its enumerated power the right to make this determination.

The other item of the Court's jurisprudence that has "disturbed the settled expectations" of the patent community is the Mayo v. Prometheus decision. Containing an explanation of its reasoning less straightforward than the Court's decision in Myriad, the Court conflated Sections 101, 102 and 103 of the Patent Act in reaching its decision and seemingly reintroduced the inchoate concept of "inventiveness" into patent law. More problematically, the Court's analysis seemed to contravene the holding in Diamond v. Diehr (1981) that claims must be considered "as a whole." And failing to hold true to the Diehr standard has permitted district courts, and even the Federal Circuit to declare claims invalid under Section 101 based on a determination that a claim consists of a "natural law, physical phenomenon or abstract idea" plus nothing "more" than what are "routine, conventional and well-understood" applications of the natural laws or uses of the natural products. See, e.g., PerkinElmer, Inc. v. Intema Ltd.; Ariosa v. Sequenom; Genetic Technologies Ltd. v. Labcorp; and Univ Utah Res. Found. v. Ambry Genetics (Myriad III).

This situation leads to the second proposal, for a new section 35 U.S.C. § 282(d):

When assessing a defense to infringement that a patent claim does not satisfy the requirements of §§ 101, 102 or 103 of this chapter, the invention must be considered "as a whole" and not by its individual limitations. The conventionality of individual limitations shall not be the basis for a determination that a claim is invalid under said §§ 101, 102 or 103.

Additional sections of the statute, or rules promulgated by the Office, may be needed to ensure the same standard is applied during patent prosecution. But, like the proposal for Section 101, this change in the law finds support, at least, under Diehr and thus may pass muster at the Court should they be challenged.

If the past decade has shown the patent community nothing else, it is that innovation cannot be held hostage to political or doctrinaire whims of any branch of government. The idea in 1982 that U.S. patent law needed consistency was a good one; it failed only because it did not recognize that the biggest source of inconsistency would be the Supreme Court. It is a lesson that needs to be well learned, accommodated and its outcome overcome if the U.S. is to retain its lead in global innovation and the economic benefits arising from this innovation.

Note: This post was adapted from a panel discussion at the Spring 2015 BIO IPCC meeting held on April 15-17 in St. Louis, MO.
Amgen v. Sandoz Update — BIO Files an Amicus Brief at the Federal Circuit

April 21, 2015

By Andrew Williams —

On March 19, 2015, U.S. District Judge Seeborg of the Northern District of California denied a motion for a preliminary injunction filed by Amgen to prevent the imminent launch by Sandoz of a biosimilar version of NEUPOGEN^® (filgrastrim). In so doing, the Court ruled that the disclosure and notice provisions of the Biologics Price Competition and Innovation Act ("BPCIA") were not mandatory. The Court entered final judgment on March 25, and two days later Amgen filed an appeal with the U.S. Court of Appeals for the Federal Circuit. According to a subsequent order in the District Court, the Federal Circuit granted an unopposed motion filed by Amgen to expedite briefing, and the parties have requested that the Appeals Court hear the matter in June.

As this case is one of first impression for the interpretation of the relevant provisions of the BPCIA, the Biotechnology Industry Organization ("BIO") filed an amicus brief last week at the Federal Circuit. In addition, two other briefs were filed by Janssen Biotech, Inc., owner of the BLA for Remicade® (infliximab), and Abbvie Inc., owner of the BLA for Humira®. It is unclear, however, whether Abbvie's corrected brief was actually properly filed. In this post, we review the amicus brief filed by BIO.

BIO began by highlighting the fact that it represents more than 1,100 member companies and research organizations, from start-ups to Fortune 500 companies. Not surprising, therefore, the brief focused on the balance struck during the establishment of the statutory pathway found in the BPCIA, which was meant to balance the interests of the biosimilar applicants and the reference product sponsors. Indeed, after noting that BIO played a leading role in the efforts to establish the BPCIA, it focused much attention on the desire of both biosimilar applicants and reference product sponsors to handle any litigation surrounding relevant patents in an expeditious manner. Because it is essentially of first impression, BIO urged the Court to not only consider the impact on this case, but on all "the circumstances to which this statute must be applied for the coming decades."

BIO first explained that in developing the BPCIA, the Hatch-Waxman Act was used as a guide, even if all of the provisions were not copied. One place of commonality was the creation of a "scheme to provide a meaningful opportunity to resolve patent disputes before product launch" (emphasis in original). This includes an artificial act of infringement prior to actual sales, and a required notification that an ANDA or biosimilar application has been filed. The acts differ, of course, in that the BPCIA adds a series of patent exchanges (the so-called "patent dance"). In addition, the reference product is entitled to 12 years of data exclusivity to preserve the incentives for biomedical research.

BIO's main argument was that "the BPCIA's notice procedure (a first notice upon acceptance and second notice prior to commercial marketing) balance the interest of biologic reference product sponsors and biosimilars to address the needs of both for a significant and real opportunity to resolve patent issues prior to the launch of the biosimilar." In fact, in the other biosimilar actions to date (relating to Amgen's Enbrel® (etanercept) product and Remicade®), both the biosimilar applicants and reference product sponsors cited the desire for "a prompt, real opportunity to resolve patent disputes before launch of the biosimilar." In the Enbrel action, Sandoz filed a declaratory judgment ("DJ"), because it allegedly sought a final district court judgement before commercial marketing in order to avoid a potential billion dollar damages claim. However, as we reported, the Federal Circuit upheld the dismissal of the action for lack of subject matter jurisdiction. Similar DJ actions were filed in the matters involving Remicade®, with similar results (one voluntary dismissal, and two motions to dismiss granted by the District court, reported here). Nevertheless, one of those DJ plaintiffs, Celltrion, had argued that the BPCIA provides a mechanism to ensure the expeditious resolution of the patent issues. In case it was not clear, the interests of both the reference product sponsor and the biosimilar applicant were encompassed within the statutory scheme of the BPCIA because it provides an expeditious pathway to resolve any potential patent infringement issues.

In an attempt to paint a similar picture that both parties to the instant action also valued the balance of the BPCIA, BIO pointed to statements by Sandoz highlighting Congress's stated goal of allowing for the resolution of "potential patent disputes prior to the launch of the biosimilar product . . . " (emphasis in original). Nevertheless, no matter the language used, it is clear that Sandoz was satisfied with circumventing these procedures notwithstanding the lack of patent certainty that would result. Indeed, Sandoz has only agreed to refrain from launching its biosimilar product until May 11, 2015, even though the Federal Circuit will certainly have not decided this case by that time.

Interestingly, BIO refers to both the disclosure provisions and the commercial marketing provisions as "notices" — "(1) notice upon application and (2) notice of commercial marketing." Therefore, in a way, Sandoz satisfied both "notice" aspects by informing Amgen via letter that its biosimilar application had been accepted and that it intended to market upon FDA approval. However, BIO did not suggest that Sandoz had satisfied the statutory requirement, because the only form in which notice of application can be provided is through the disclosure of the application and other essential information. Otherwise, as BIO explained, if the biosimilar applicant withholds its application and does not otherwise provide notice, the reference product sponsor may never learn that such an application was filed. "It makes little sense for Congress to devise a carefully orchestrated process for exchanging information, and identifying and enforcing patents that might only begin if the reference product sponsor serendipitously discovered from public sources that a biosimilar application has been filed."

Moreover, the 180-day notice of commercial marketing, under the BPCIA, "effectuates litigation on patents that were listed but not part of the early stage litigation" (emphasis in original). As such, the statute specifies that this notice must occur at the end of the patent dance, not before it has even begun. BIO also pointed to the statute's requirement that this "notice" be with regard to the "licensed" product, not simply with any biosimilar application that has been filed with the FDA. To be a licensed product, it must have FDA approval.

Finally, in response to the arguments below that the 180-day notice period amounts to a de facto extension of the data exclusivity, BIO asserted that this is simply not true. Instead, the patent disputes were meant to be resolved during the final 8 years of data exclusivity — which should be plenty of time for a decision on the merits. In other words, the 180-day notice should normally be provided well before exclusivity expires. Just because scenarios exist where the 180-day notice cannot be provided with sufficient time does not make the statute unfair. "The biosimilar applicants' choice of when to file the application or to defer the litigation over listed patents until 'late stage' preliminary injunction litigation comes with timing consequences." For biologics such as in this case, where the drug has been on the market so long that there is no data exclusivity remaining, "a notice of commercial marketing would provide a modest 6-month respite before commercial launch of the approved biosimilar product to resolve patent disputes before biosimilar launch . . . ." That this timing might not be optimal for all applicants is of no moment.

We will continue to monitor this case and report on the briefing of other parties in subsequent posts.
Legislation Introduced in House to Eliminate Uncertainty Regarding AIA Grace Period

April 20, 2015

By Donald Zuhn —

Last week, legislation was introduced in the House of Representatives that would amend 35 U.S.C. § 102(b) "to correct the drafting problem in the Leahy-Smith America Invents Act relating to the grace period." The bill, entitled the "Grace Period Restoration Act of 2015" (H.R. 1791), was sponsored by Rep. James Sensenbrenner (R-WI) and co-sponsored by Rep. John Conyers, Jr. (D-MI).

As set forth in a summary of the bill provided by the sponsors, the AIA replaced the previous grace period with a new version providing that certain disclosures that occur less than one year before a patent application filing could be considered as prior art, thereby defeating patent rights. The summary contends that "[t]he prior grace period that encouraged early sharing of knowledge was replaced with a system that actually discourages early publication." In particular, the bill's proponents assert that:

The AIA includes language regarding the scope of the grace period during which an inventor who discloses an invention to the public may decide within a one-year period whether to make a patent application filing. The language is ambiguous. To make matters more confusing, the regulatory reading of the AIA by the U.S. Patent and Trademark Office does not comport with the clear intent of the AIA sponsors.

In order "to clarify that the grace period is truly a grace period" and remove uncertainty relating to the AIA grace period, the sponsors note that their bill would:

• protect an inventor against disclosures by anyone after the inventor has made a public disclosure of the claimed invention in a "printed publication"
• apply to any and all of an inventor's acts that are public disclosures that jeopardize right to a patent
• remove prior art under both sections 102 and 103 of the Patent Act

In particular, the bill would amend § 102(b) by adding the following text:

(3) DISCLOSURES BY ANY PERSON AFTER PUBLIC DISCLOSURE OF A CLAIMED INVENTION BY AN INVENTOR.
    (A) DEFINITIONS.—In this paragraph—
        (i) the term "covered person", with respect to a claimed invention, means—
            (I) the inventor;
            (II) a joint inventor; or
            (III) another who obtained the claimed invention directly or indirectly from the inventor or a joint inventor; and
        (ii) the term "relevant section 112(a) requirements" means the requirements for a specification under section 112(a) other than the requirement to set forth the best mode of carrying out the invention.
    (B) PUBLIC DISCLOSURE.—A disclosure by any person shall not be prior art to a claimed invention under subsection (a) or section 103 if—
        (i) the disclosure is made under subsection (a)(1) or effectively filed under subsection (a)(2) 1 year or less before the effective filing date of the claimed invention; and
        (ii) before the disclosure described in clause (i) is made or filed, and 1 year or less before the effective filing date of the claimed invention, the claimed invention is publicly disclosed in a printed publication by a covered person in a manner that satisfies the relevant section 112(a) requirements.
    (C) DETERMINATION THAT PUBLIC DISCLOSURE WOULD HAVE SATISFIED SPECIFICATION REQUIREMENTS.—In determining under subparagraph (B) whether a claimed invention was publicly disclosed in a printed publication by a covered person in a manner that satisfied the relevant section 112(a) requirements—
        (i) only the state of the art known on and before the date of the disclosure may be considered; and
        (ii) satisfaction of the relevant section 112(a) requirements may be—
            (I) established by 1 or more public disclosures in printed publications made by a covered person during the period of 1 year or less between—
                (aa) the disclosure by the covered person described in subparagraph (B)(ii); and
                (bb) the effective filing date of the claimed invention; and
            (II) supported by statements under declaration or oath relating to the existence and content of the public disclosure or disclosures in printed publications described in subclause (I).
    (D) PRESUMPTION OF VALIDITY.—An applicant for a patent shall present to the Patent and Trademark Office, before the Patent and Trademark Office issues a notice of allowance of the application for the patent, each disclosure under subparagraph (C)(ii)(I) and any statement under subparagraph (C)(ii)(II) in order for the section 112(a) support provided by each such disclosure or statement under subparagraph (C)(ii) to be taken into account under the section 282(a) presumption of validity of an issued patent.
    (E) CERTAIN DISCLOSURES NOT PRIOR ART.—A disclosure described in paragraph (1)(A), (2)(A), or (2)(C) shall not be prior art to a claimed invention under this paragraph.
    (F) PROCEDURES.—The Patent and Trademark Office may establish procedures to carry out this paragraph.

Among the findings outlined in the legislation, the bill notes that:

(1) Language in the Leahy-Smith America Invents Act . . . and regulations and examination guidelines issued by the United States Patent and Trademark Office implementing provisions of that Act have created uncertainty regarding the scope of the 1-year grace period during which an inventor who discloses an invention to the public may decide whether to file a patent application for the invention . . . .
(2) The regulatory reading of the Leahy-Smith America Invents Act does not comport with the intent of the sponsors of that Act.

The legilsation particularly focuses on the impact of the AIA grace period on institutions of higher education and government laboratories, which the bill asserts "perform[] more than 50 percent of all basic research in the United States."

The legislation, which was introduced in the House on April 14, was then referred to the House Judiciary Committee. A companion bill is expected to be introduced in the Senate by Senator Tammy Baldwin (D-WI) and David Vitter (R-LA).

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