Patent Docs

Bayer Schering Pharma AG v. Barr Laboratories, Inc. (D. N.J. 2008)

March 6, 2008

By Kevin E. Noonan —

On Monday, the U.S. District Court for the District of New Jersey (Judge Peter G. Sheridan, presiding) found after a bench trial on all issues that Bayer’s U.S. Patent 6,787,531 was invalid for obviousness. In doing so, the Court’s decision illustrated anew the uncertainties that the U.S. Supreme Court’s KSR Int’l Co. v. Teleflex, Inc. decision has (re)introduced into patent law, and the folly of the Supreme Court’s simple-minded "common sense" approach to the issue.

Bayer’s patent claims a pharmaceutical composition of an oral contraceptive marketed as Yasmin® in the U.S., comprising a combination of drospirenone and ethinylestradiol. Claim 1 of the ‘531 patent is representative of the claimed formulation:

1. A pharmaceutical composition comprising from about 2 mg to about 4 mg of micronized drospirenone particles, about 0.01 mg to about 0.05 mg of 17-alpha-ethinylestradiol, and one or more pharmaceutically acceptable carriers, the composition being in an oral dose form exposed to the gastric environment upon dissolution, and the composition being effective for oral contraception in a human female.

This combination as an oral contraceptive was not new; the formulation was. Bayer found that, despite the fact that drospirenone was known to be acid labile and to isomerize into an inactive form, the combination could be advantageously formulated using micronized drospirenone (which increased absorbsion of the drug but was expected to also increase the rate of isomerization) and by not coating the drospirenone with an enteric coating. Since this was an oral formulation, an enteric coating would be expected in the art to protect the drug from isomerization in the acidic environment of the stomach.

The action was initiated pursuant to the provisions of the Hatch-Waxman Act in response to Barr having filed an Abbreviated New Drug Application (ANDA) with the Food and Drug Administration. Barr’s position was that the use of micronization to improve drug absorbsion and enteric coatings to protect acid-labile drugs was "routinely considered" by drug formulators in making drugs for oral administration, and that Bayer’s claims were thus obvious.

The prior art considered by the Court included a common formulation text not particularly directed to oral contraceptives (Aulton, 1988, Pharmaceutics: The Science of Dosage Form Design) and a number of scientific journal articles relating to acid-lability of not drospirenone but a related compound, spirenone, both in vitro and in vivo. Also considered were prior art patents for various combinations of oral contraceptives formulated for different administration schedules.

Bayer also introduced testimony relating to how the invention was made, specifically relating to the surprising findings that formulating the drug in ways that should have increased isomerization (micronizing the acid-labile drospirenone and dispensing with the enteric coating) in fact had the opposite effect. According to this testimony, the reason for this paradoxical result is that the micronized drug was absorbed more rapidly than it isomerized in vivo, and enteric coatings made the effectiveness of the drug more variable; it was uncontested that the drug had to be 99% effective to be useful as a contraceptive. This testimony and other evidence established that Bayer scientists had originally prepared formulations that were unmicronized and enterically-coated, and that they were successful only when they changed direction and prepared the formulation that was the subject of the ‘531 patent.

Judge Sheridan disregarded this evidence, on the grounds that it was not reasonable to him that Bayer’s scientists would have changed direction as abruptly as they purportedly did in their formulation work. Moreover, the Court believed that the Aulton treatise and other scientific journal references, as well as Barr’s expert, taught that acid lability studies in vitro would never be sufficient to establish whether a drug was truly acid labile without complementary in vivo studies, and that had Bayer performed the in vivo studies they would have known that the absorbsion rate was sufficiently fast that enteric coatings were unnecessary and micronization was desirable. In addition, the Court cited three studies (including both in vitro and in vivo arms) with the related drug spirenone that purported to show the absence of spirenone isomers in blood samples from experimental animals or human volunteers administered tableted spirenone. In vitro studies on drospirenone, on the other hand, showed that 80% of the drug had isomerized in a 0.1N HCl solution at room temperature. The Court found that spirenone and drospirenone were related "as close[ly] as fraternal twins" and thus imputed the behavior of spirenone to drospirenone.

The Court conducted its obviousness analysis based on these facts expressly using the rubrics of Graham v. John Deere, citing KSR as the impetus for this analysis. In comparing the differences between the prior art and Bayer’s claimed invention, the Court found this critical factor that informed its analysis:

There is one other principle that is clearly established in the prior art which defeats both claims. The prior art states the in vitro studies are unreliable unless they are correlated to in vivo testing (Aulton, McGilveray). Unlike Nickisch, a person of ordinary skill in the art would conduct such testing. Decisions about drug dose form are then made based upon the in vitro/in vivo testing. That is, the decision whether to micronize and/or enteric coat comes second. In this case, Bayer argues that the person of ordinary skill in the art would reverse this process ("put the cart before the horse"). This does not make sense. Justice Kennedy in KSR observed that in analyzing an obviousness defense, the court must use its common sense. KSR, 127 S. Ct. at 1732. In this instance, Bayer’s alleged exception to the in vitro/in vivo correlation rule (that it does not apply to acid sensitive drugs) does not ring true. A person of ordinary skill in the art must precisely know and verify the characteristics and chemical reactions of a drug in order to evaluate its therapeutic value in humans. To follow McGinity’s alleged exception for acid-sensitive drugs can only lead to sketchy, imprecise formulation results and an increased risk of injury to users.

Judge Sheridan’s Opinion (emphasis added). Using "its common sense," the Court found Bayer’s formulation claims obvious.

It is an everyday occurrence to note that "common sense" is anything but common, even among the most mundane of human activities. Most would agree that pharmaceutical formulation is hardly a mundane activity, and is fraught with uncertainties exacerbated by the unpredictability of patient response to a particular formulation; indeed, a great deal of the regulatory apparatus for approving new drugs is based on establishing that the vast majority of patients will be helped and, more importantly, not be harmed by a formulation. The evidence presented to Judge Sheridan established just this sort of unpredictable result, where an acid-labile drug is provided in a better formulation when it is treated in ways expected to increase isomerization and drug inactivation in the acidic environment of the stomach.

And yet Judge Sheridan, harkening to the admonitions of the Supreme Court that he should employ "common sense," disregards the extensive evidence of these uncertainties and decides that, to him, Bayer’s activities "put the cart before the horse." Never mind the Supreme Court’s equal admonitions against the insidious effects of hindsight, or how "obvious" the result may be once it is found that the drug, surprisingly, is absorbed faster than it can isomerize. No, Judge Sheridan is comfortable substituting his "common sense" interpretation of what is the cart and what is the horse, and the order they should go in, to decide that Bayer’s formulation would be obvious.

This is madness. It cannot be the Supreme Court’s intention to unleash the generally uninformed "common sense" of the generalist judiciary to trump testimony by the individuals — the inventors — who actually perform the experiments and produce the inventions whose disclosure fulfills the Constitutional mandate to "promote the progress of the useful arts." But that is precisely the effect that the KSR decision, and most of the rest of the Supreme Court’s obviousness jurisprudence will have (and is having) on U.S. patent law. It is not enough that the Court mistakes the proper emphasis of the correct Constitutional analysis by putting the cart of restricting monopolies before the horse of promoting disclosure of new inventions. In KSR and the rest of the Supreme Court’s "totality of the circumstances," "we know an obvious invention when we see one" jurisprudence, it substitutes judicial common sense for scientific common sense. Folly, pure and simple.

Barr made two other allegations against the claims of the ‘531 patent. First, that the clinical trials performed in the U.S. were a public use, because earlier clinical trials in Europe had established that the formulation was safe and effective and because the study participants were not bound by confidentiality to withhold from their personal physicians the identity of the drugs they were administered. The Court found that Bayer’s proffered reason for performing clinical testing in the U.S. — the greater ethnic diversity of the U.S. versus the European population — constituted experimental use, not public use, and that Bayer had established the appropriate confidentiality conditions for the physicians and other healthcare and scientific workers involved with the clinical trials. (It was also persuasive that there were ethical prohibitions against keeping the identity of the administered drugs from trial participants’ physicians.) Second, the Court found that while the evidence of the European clinical trials was material to patentability on the public use question, Bayer declarants showed no intent to deceive the U.S. Patent and Trademark Office by only partially and obliquely referring to these trials (and the data obtained from them) during prosecution of the ‘531 patent.

Additional information regarding this case can be found at the Orange Book Blog.
Patent Profile: Commonwealth Biotechnologies Announces Issuance of Patent Related to Real Time PCR Detection of Herpes Virus

March 6, 2008

By Donald Zuhn —

Commonwealth Biotechnologies, Inc. announced today that it has been granted U.S. Patent No. 7,338,761. According to Commonwealth’s press release, while the ‘761 patent is assigned to Vigen Laboratories, the patent is exclusively licensed to CBI Services, a Commonwealth business unit, which developed the claimed invention under contract to Vigen Laboratories. Commonwealth’s release also notes that the two named co-inventors of the ‘761 patent are CBI President Robert Harris and CBI Executive Vice President Thomas Reynolds. Now that the ‘761 patent has issued, Commonwealth and Vigen are looking to out-license the patented technology to a clinical laboratory
service provider who can commercialize the assay on a large scale, with the two companies to share equally in licensing revenue.

The ‘761 patent is directed to real time PCR-based assays and polynucleotide sets for detecting human herpes viruses. According to Commonwealth’s statement, the platform described in the ‘761 patent provides a "rapid and specific assay of each of the various [human herpes viruses] down to as few as 10 copies of viral DNA in patient samples," and "has been successfully applied to peripheral blood serum, sputum, cerebrospinal fluid, and various laboratory preparations."

There are eight known human herpes viruses (HHVs), which can be divided into three classes: the alpha herpes viruses, which include HSV 1 (simplex virus), HSV 2 (simplex virus), and HHV 3 (varicellovirus); the beta herpes viruses, which include HHV 5 (cytomegalovirus), HHV 6, and HHV 7 (Roseolovirus); and the gamma herpes viruses, which include HHV 4 (Epstein Barr virus) and HHV 8 (Rhadinovirus). The herpes viruses are associated with a number of conditions, including:

• HHV 1 and 2 are the causative agents of genital herpes.
• HHV 4 is associated with infectious mononucleosis (glandular fever), chronic-fatigue syndrome, oncogenesis (particularly in relation to Burkitt’s lymphoma nasopharyngeocarcinoma), immuno-suppression, and Hodgkin’s disease.
• HHV 5 is associated with chronic-fatigue syndrome, and is known to cause lung infections in immune-suppressed persons.
• HHV 6 is associated with roseola and infantum infection in children and with immuno-compromised patients, and may perhaps be involved with multiple sclerosis and chronic fatigue syndrome.
• HHV 8 appears to be associated with Karposi’s Sarcoma.

The ‘761 patent issued from U.S. Application No. 10/399,872, which is a national stage application of International Application No. PCT/US01/31892, filed October 12, 2001, which claims the benefit of U.S. Provisional Application No. 60/242,903, filed October 24, 2000. Representative claims 1, 16, and 17 of the ‘761 patent recite:

1. A set of polynucleotide molecules wherein the set comprises the polynucleotide molecules consisting of SEQ ID NOS: 33, 34, and 35 and optionally a fourth polynucleotide molecule comprising SEQ ID NO: 57.

16. A method for detecting infection by HHV6 in a sample from an individual suspected of being infected with HHV6, comprising:
(a) amplifying, in the course of a single amplification reaction, a target segment of an HHV6 glycoprotein B gene comprising SEQ ID NO: 57 using primers and a probe consisting of SEQ ID NOS: 33, 34, and 35 and
(b) interpolating the number of HHV6 viral nucleic acid copies in the sample by comparing the number of amplification cycles required for detection of the target segment to the number of amplification cycles required to detect a known quantity of the target segment.

17. A method for detecting infection by either HHV6a or HHV6b in a sample from an individual suspected of being infected with either HHV6a or HHV6b, comprising:
(a) amplifying, in the course of a single amplification reaction, a target segment of an HHV6 glycoprotein B gene comprising SEQ ID NO: 57, using primers and a probe consisting of SEQ ID NOS: 33, 34, and 35; and
(b) interpolating the number of either HHV6a or HHV6b viral nucleic acid copies in the sample by comparing the number of amplification cycles required for detection of the target segment to the number of amplification cycles required to detect a known quantity of the target segment.
Biotech and Pharma Companies Spent Millions on Lobbying in 2007

March 5, 2008

By Donald Zuhn —

Last month, we noted that Millennium Pharmaceuticals spent $1.28 million in 2007 lobbying Congress and the Department of Commerce on patent reform and biologics legislation. Under federal law, lobbyists are required to disclose activities and expenditures that could influence members of the executive and legislative branches. Since the news of Millennium’s lobbying spending was released, information regarding the lobbying efforts of other companies and organizations has been published.

In particular, Forbes.com reported at the end of February that Genenech Inc. spent $1.8 million lobbying the federal government in 2007. While a portion of Genentech’s lobbying expenditures were directed to patent reform and biologics legislation, the South San Francisco biotech company also lobbied on other bills that would impact the biotech drug market.

Another Forbes.com report from February indicates that AstraZeneca PLC topped both Millennium and Genentech by spending $4.1 million on lobbying in 2007. According to the Forbes report, AstraZeneca’s lobbying efforts were directed to patent reform and biologics legislation.

Finally, on the other side of the patent reform issue, an Associated Press release from late last month reported that the Coalition for Patent Fairness paid Patton Boggs LLP $500,000 last year to push for patent reform legislation. According to the Coalition’s website, the organization is "a diverse group of companies and industry associations dedicated to protecting consumers and enhancing U.S. innovative potential by strengthening our nation’s patent system," which the Coalition argues " leaves U.S. consumers and businesses at a clear disadvantage" by forcing companies "to focus more on the risks of innovation than the benefits to consumers and society as a whole." The Coalition seeks to reform damages (courts should be required to focus on the value that is attributable to the patent in question, and not on the full value of the entire product); reform the willfulness standard and procedure for litigating willfulness claims; establish a new administrative procedure for post-grant review of patent grants so that wrongfully-issued patents can be effectively reviewed and redressed within the U.S. Patent and Trademark Office, rather than in the courts; and changes to venue standards to prohibit "venue shopping."
USPTO Announces Agenda for Next BCP Art Group Meeting

March 5, 2008

As a reminder, the biotechnology, chemical, and pharmaceuticals (BCP) technology
groups at the U.S. Patent Office will hold their first quarterly customer partnership meeting of the year on March 12, 2008. The schedule and topics for discussion
have been finalized and include:

Morning Session

• Greetings and Overview (9:00 – 9:15 AM): John LeGuyader, Bruce Kisliuk, Christopher Low, Directors, Technology Center 1600

• Patent Prosecution Highway (9:15 – 10:00 AM): Pinchus Laufer, Office of Patent Legal Administration

• Biotechnology, Chemistry and Pharmaceuticals in the Mechanical Arts (10:00 -10:45 AM): Thomas Barrett, SPE, TC3700

• Restriction Petition Update and Rejoinder Practice (11:00 AM – 12:00 PM): Julie Burke, QAS/PM, TC1600

Afternoon Session

• Enablement in Claims to Various Forms of Compounds (1:15 – 2:00 PM): James Wilson, SPE, Art Unit 1624

• Bioinformatics and 35 USC 101 (2:00 – 2:45 PM): Marjorie Moran, SPE, Art Unit 1631

• Enablement in Claims to Therapeutic Treatment (3:00 – 4:00 PM): Jean Witz, QAS, TC1600

* Closing Remarks/Discussion (4:00 – 4:15 PM): John LeGuyader,
Bruce Kisliuk, Christopher Low, Directors, Technology Center 1600

The presentation can be attended in person at Madison Auditorium (600 Dulany Street, Alexandria, VA). In order to attend the meeting in person, you must confirm your attendance with Cecilia Tsang by phone (571-272-0562), fax (571-273-0562), or e-mail (Cecilia.Tsang@uspto.gov). The meeting will also be viewable over the internet (accessible via a link at the PTO's announcement here).
POPA President Critical of USPTO During House Subcommittee Oversight Hearing

March 4, 2008

By Donald Zuhn —

Last week, we reported on appearances by Jon Dudas, the Undersecretary of Commerce for Intellectual Property and Director of U.S. Patent and Trademark Office, and Alan Kasper, the First Vice President of the American Intellectual Property Law Association (AIPLA), at an oversight hearing on the USPTO held by the House Subcommittee on Courts, the Internet, and Intellectual Property. The Subcommittee also heard statements from Robin Nazzaro, the Director of National Resources and Environment for the U.S. General Accountability Office, and Robert Budens, the President of the Patent Office Professional Association (POPA). Today, we address Mr. Budens’ statement, in which the POPA President spared no criticism of the Patent Office’s efforts to increase patent quality and decrease pendency.

Mr. Budens, who represents more than 5,800 patent professionals at the USPTO, began by acknowledging that "[t]he USPTO has been the target of much criticism in recent years for failing to allow high-quality patents and doing so in a timely manner." He noted that "[t]his criticism has resulted in increased scrutiny of the day-to-day operations of the USPTO as well as review of the laws governing the patent system," but argued that the solutions being proposed by the Patent Office and Congress "go far beyond what is truly necessary to improve performance at the USPTO." According to Mr. Budens, the problems facing the Patent Office — namely patent quality and pendency — are "internal problems of the USPTO," and "must be solved in the USPTO." In particular, he contended that these problems could only be resolved by providing patent examiners with the time and tools that they need to do the job right.

The POPA President argued that three key components were required to "do the job right": people, time, and tools. With respect to the first component, Mr. Budens noted that while application filings have continued to rise, "years of inadequate funding and restrictions on hiring [have] left the USPTO severely understaffed." However, in view of the 3,411 examiners the Patent Office hired between 2005 and 2007, Mr. Budens stated that the Office no longer has a significant hiring problem, but rather has a problem keeping the people it does hire. In support of this argument, Mr. Budens pointed out that during the same three-year period, the Office lost 1,478 examiners — or nearly one examiner for every two it hired.

In addition, the POPA President disputed Mr. Dudas’ testimony that the Office’s attrition rate for examiners with less than three years experience was only 15.5%, arguing that the Director’s attrition statistics "do not appear to correlate with previously published USPTO data," which actually show an attrition rate of between 30 and 44%. Mr. Budens also attacked the initiatives (e.g., retention bonuses, increases in examiners’ special pay rate, and part-time employment) the Patent Office "claims" to be instituting to increase examiner retention. Mr. Budens concluded his attack on the Office’s retention policies by stating that:

the one thing management could do to increase retention, it has consistently refused to do for more than thirty years — provide examiners with the time to do the job right. More than any other factor, the most common reason examiners leave the USPTO is the unrelenting stress caused by the agency’s outdated production system.

The POPA President summarized that "[w]hen it comes to retention of examiners, the agency’s anti-employee actions speak much louder than their words."

Moving to the second component of "doing the job right" (i.e., time), Mr. Budens continued his assault on the Patent Office’s antiquated production system, reiterating that "for more than thirty years the agency has refused to adjust examiners’ production goals to compensate for the increasing complexity of technologies, larger and more complex patent applications, and an ever-expanding body of both patent and non-patent literature (prior art)." Calling the examiners’ high-stress environment the equivalent of a "legal sweatshop," Mr. Budens noted that "a GS-12 examiner has, on average, about 20.4 hours, spread over one to two years, to complete the examination of a utility-type patent application." Depending on the technology area, he explained that some examiners may have as little as 11.2 hours, and no more than a maximum of 22.1 hours, to examine an application.

Mr. Budens also noted that while the Patent Office’s production goals have remained essentially unchanged since they were put in place in 1976, examiners currently examine technologies (such as biotechnology) that simply did not exist when the production goals were put in place. In addition, examiners must search ever increasing amounts of information to identify relevant prior art. Using just the collection of U.S. patents as an example, Mr. Budens pointed out that while it took the Patent Office two hundred years to issue its five millionth patent, in the seventeen years since U.S. Patent No. 5,000,000 issued, more than 2.3 million additional patents have issued.

The POPA President argued that "[t]rying to do high quality examination of patent applications in 2008 in the amount of time examiners were given in 1976 has left examiners angry, stressed-out and demoralized." Moreover, he added that "POPA’s data revealed that one third of examiners work unpaid overtime just to keep their jobs!" Finally, Mr. Budens noted that while a 2003 National Research Council of the National Academy of Sciences study indicated that providing examiners with a one-hour increase per application would cost the USPTO $11.3 million, the one-hour increase would decrease litigation expenses by more than $17 million.

Addressing the final component of "doing the job right" (i.e., tools), Mr. Budens argued that:

after neglecting the U.S. classification system and eliminating one of the most useful and unique search tools in the world — the paper search files — the agency wants to finish the job of effectively outsourcing the search to patent applicants by obtaining statutory authority to require all or nearly all patent applicants to perform a mandatory search and submit an Applicant Quality Submission (AQS) in their patent applications.

Mr. Budens contended that the Office’s dogged pursuit of AQS legislation was misplaced since 37 C.F.R. § 1.56 — when properly enforced — was more than adequate to accomplish the goal of increasing patent quality. According to Mr. Budens’ group:

[a] patent search is an integral part of the examination process and represents an inherently governmental function that should not be outsourced to the private sector. As the patent search forms the very basis of determining property rights in the United States, the search should be performed by U.S. Government employees free of any conflicts of interest — USPTO patent examiners.

Mr. Budens added that "[t]he only clear effect of the AQS is to dramatically increase the cost of applying for a patent." As for the Patent Office’s true motivation in seeking an AQS provision in the patent reform legislation, Mr. Budens speculated that the Office desired "to effectively outsource the patent search to applicants so that it can ‘gain efficiency’ by reclaiming that search time from examiners thereby requiring them to examine more cases." He suggested that the because AQSs will "dramatically increase the cost of protecting innovation in America" and the benefits of AQSs were speculative at best, the AQS provision should be deleted from the Senate bill.
USPTO News: USPTO e-Commerce Update

March 4, 2008

By Christopher P. Singer —

In an e-Alert sent out on March 4, 2008, the U.S. Patent and Trademark Office provided a link to an updated "Declaration for Utility or Design Patent Application" (Form PTO/SB/01) which can be accessed here. As we previously reported, the updated Declaration form provides a checkbox that automatically authorized the USPTO to release an unpublished priority document to the European Patent Office (EPO) or the Japan Patent Office (JPO). Applicants can still authorize the USPTO to release such applications using the Form PTO/SB/39.

In an effort to bring more people to e-filing via EFS-Web, the USPTO also announced the launch of a free Computer Based Training (CBT) program called "Getting Started with EFS-Web." The program is intended to provide an overview of EFS-Web functionalities, the benefits of using EFS-Web, digital certificates, and customer numbers. The training program runs for about 30 minutes and can be accessed here.
USPTO’s Bruce Kisliuk Addresses ACI Conference

March 3, 2008

By Donald Zuhn —

At last week’s American Conference Institute (ACI) Pharma/Biotech Patent Claim Drafting and Prosecution conference, Bruce Kisliuk, the Director of the U.S. Patent and Trademark Office’s Technology Center 1600, gave an interesting address in which he touched on a number of topics, and then opened the floor to questions from conference attendees. Perhaps alluding to the Tafas/GSK v. Dudas case, Mr. Kisliuk began his talk by stating that he had "good news" — namely that he didn’t have anything new to report. In view of the unexpected shortage of news regarding the GSK case (and thus, the lack of any new information about the continuation and claims rules and IDS rules), the TC 1600 Director focused instead on patent reform, his Group’s implementation of the new obviousness examination guidelines, and the Office’s other rules initiatives (besides the continuation and claims rules and IDS rules).

Patent Reform

Mr. Kisliuk (at left) reiterated that the Patent Office does not support the Senate patent reform bill, stating that "we don’t believe that some of the proposals are fixing the problems the right way." In particular, the Group Director declared that "the PTO doesn’t want tolerating infringement to become the cost of doing business." As to how the Senate could report such a heavily criticized bill, Mr. Kisliuk speculated that "the reality is that most of the discussions [taking place on Capitol Hill] are not high level."

The Group Director, however, did not hesitate to point out the portions of the Senate bill that the Patent Office found to be acceptable. Not surprisingly, he began with the dreaded Applicant Quality Submissions (AQSs), which he called "fundamental pieces" of the Office’s effort to promote "shared responsibility" between patent applicants and the Patent Office. Somewhat refreshingly, Mr. Kisliuk did not turn a blind eye to the significant problems these "fundamental pieces of shared responsibility" would cause in view of current inequitable conduct jurisprudence. Acknowledging that patent attorneys and applicants have been unable to discuss AQSs apart from inequitable conduct, the Director noted that the Patent Office supported inequitable conduct reform. According to Mr. Kisliuk, the Office supported separate analyses of materiality and intent, an adoption of the pre-1992 materiality standard (both of which have been included in the Senate bill), and a lessening of the "all of nothing" impact of an inequitable conduct finding (presumably so claims not touched by a finding of inequitable conduct might remain enforceable).

As for the other portions of the Senate bill with which the Patent Office finds favor, Mr. Kisliuk mentioned fee setting authority and post-grant review. With respect to the latter, the Group Director noted that the Office supported both a first and second window of review, but wanted to see some revisions to the second window. According to Mr. Kisliuk, the Office is "uncomfortable" about letting anyone challenge a patent during the entire length of its term.

When asked to opine on the possible fate of the Senate bill, Mr. Kisliuk deferred to the grapevine, stating that "most people in the know believe the window [for passage] is closing."

Examination Guidelines for Determining Obviousness

The Group Director spent the bulk of his talk discussing the implementation of the new obviousness examination guidelines in TC 1600. Before addressing the details of this implementation, Mr. Kisliuk declared that neither the Supreme Court’s decision in KSR Int’l Co. v. Teleflex, Inc. nor the Patent Office’s issuance of examination guidelines last October represented a "sea change." Instead, "the basic approach [for examining applications for compliance with 35 U.S.C. § 103] remains the same," and was focused, as always, on the analysis outlined in Graham v. John Deere. In addition, Mr. Kisliuk believed that most of the rationales set forth in the new obviousness examination guidelines would apply to "classical mechanical situations," but he wasn’t sure how applicable these rationales would be to the examination of biotech and pharma applications.

As for implementing the new guidelines, the Group Director noted that "high-level" obviousness training (consisting of a 2-hour session with some small-group follow-up sessions) was nearly complete in TC 1600, with less than 50 examiners remaining to be trained. Moreover, instead of teaching the guidelines’ rationales as bright-line rules (since Mr. Kisliuk believed the Supreme Court had cautioned against the use of rigid, bright-line rules in KSR), the Group Director noted that TC 1600 examiners were being taught to analyze the issue obviousness using eleven key cases as tools. The eleven cases are:

1. Pharmastem Therapeutics, Inc. v. Viacell, Inc. (Fed. Cir. 2007) – as we discussed here;
2. Pfizer, Inc. v. Apotex, Inc. (Fed. Cir. 2007) – as we discussed here;
3. Takeda Chem. Indus., Ltd. v. Alphapharm Pty., Ltd. (Fed. Cir. 2007) – as we discussed here;
4. McNeil-PPC, Inc. v. Perrigo, Co. (S.D.N.Y. 2007);
5. In re Omeprazole Patent Litigation (S.D.N.Y. 2007);
6. Ex parte Kubin (B.P.A.I. 2007) – as we discussed here;
7. In re Sullivan (Fed. Cir. 2007) – as we discussed here;
8. Daiichi Sankyo Co. v. Apotex, Inc. (Fed. Cir. 2007) – as we discussed here;
9. Aventis Pharma Deutschland GmbH v. Lupin, Ltd. (Fed. Cir. 2007) – as we discussed here;
10. Forest Labs., Inc. v. Ivax Pharm., Inc. (Fed. Cir. 2007) – as we discussed here;
11. Syngenta Seeds, Inc. v. Monsanto Co. (D. Del. 2004)

The Group Director stressed that he wanted the examiners to focus on the facts of each case (since the issue of obviousness is very fact specific), and more specifically, on the "science behind the case." Addressing the most controversial of the eleven cases (i.e., Ex parte Kubin), Mr. Kisliuk stated that TC 1600 examiners were not being taught to think of In re Duell as being dead, but rather, were being taught that Kubin illustrates that advances in the state of the art may render something previously unpredictable to be predictable.

Mr. Kisliuk closed his obviousness discussion by predicting that the Office would soon be facing an influx of Rule 132 declarations on the issue of obviousness, and indicated that examiners were currently being trained to properly consider and weigh the probative value of this expected influx of declarations.

Rules Initiatives

Although he spent little time discussing the proposed appeal rules, the Group Director did note that TC 1600 had the lowest percent of pre-appeal conference requests, the lowest success rate (i.e., lowest percent of cases reopened or allowed) on pre-appeal, and the lowest success rate on appeal. With respect to the first measure, Mr. Kisliuk conceded that he didn’t know whether this indicated that his Group was doing a better job at issuing rejections or whether biotech and pharma patent attorneys were simply not using the pre-appeal process as a tool. The Group Director couldn’t explain the low pre-appeal and appeal success rates, but sees the low rates "as a good sign, not a bad one."

On the topic of the proposed alternative claiming rules, Mr. Kisliuk noted that few comments had been submitted in response to the proposed rules, but acknowledged that "people have been distracted" by other events. In defending the need for the alternative claiming rules, the Group Director provided an example in which a claimed formula encompassed some 2.63 x 10(14) variants, and asked the conference attendees where an examiner should start examining such a claim.

Tafas/GSK v. Dudas

The Group Director closed his discussion by briefly touching on the GSK case (even though he had admitted at the start of his talk that he had no news to report). Mr. Kisliuk reported that he had attended both the October and February hearings, and felt that as to the issues of continuation limitations, claims limitations, RCE limitations, and retroactivity, "neither side is going to win it all." Acknowledging that he was only speculating, the Group Director suggested that "the PTO may move forward with what it does get." When asked when he expected the Court to reach a decision, Mr. Kisliuk conceded that he knew little more than the conference attendees, but stated that "insiders" were thinking the Court would announce its decision in about a month from the date of the hearing (February 8th). If his prediction holds true, patent attorneys and applicants could see a decision by the end of this week.
Court Report

March 3, 2008

By Sherri Oslick —

About
Court Report: Each week we will report briefly on recently filed
biotech and pharma cases, and a few interesting cases will be selected
for periodic monitoring.

SmithKline Beecham Corporation v. Barr Pharmaceuticals Inc. et al.
1:08-cv-00112; filed February 25, 2008 in the District Court of Delaware

Infringement of U.S. Patent Nos. 5,565,467 ("Androstenone Derivative," issued October 15, 1996), 5,846,976 (same title, issued December 8, 1998), and 5,998,427 ("Androstenones," issued December 7, 1999) following a paragraph IV certification as part of Barr’s filing of an ANDA to manufacture a generic version of GSK’s Avodart® (dutasteride, used to treat symptomatic benign prostatic hyperplasia (BPH) in men with an enlarged prostate). View the complaint here.

Astellas US LLC et al. v. Anazaohealth Corporation et al.
2:08-cv-01083; filed February 15, 2008 in the Western District of California

Infringement of U.S. Patent Nos. 5,731,296 ("Selective Vasodilation by Continuous Adenosine Infusion," issued March 24, 1998) and 5,070,877 ("Novel Method of Myocardial Imaging," issued December 10, 1991), both licensed to Astellas, based on defendants’ alleged marketing, through its sales agents, of its generic version of Astellas’ Adenoscan® product (adenosine injection, used as a diagnostic for myocardial reperfusion injury) for use in an infringing manner. View the complaint here.
Roche’s Mircera® Remains Off the Market (For Now)

March 2, 2008

By Kevin E. Noonan —

Last Friday, the U.S. District Court for the District of Massachusetts (Judge William G. Young, presiding) granted a preliminary injunction to Amgen against Hoffman La-Roche, preventing Roche from selling its Mircera® drug product, a form of recombinant EPO that has been covalently linked to polyethylene glycol. Last November, the U.S. Food and Drug Administration granted approval for Roche to market Mircera® (it has already been approved in Europe and is sold in Austria, Sweden, Germany, the United Kingdom, and Norway). Roche had moved for the Court to permit it to launch (offering Amgen a 20% royalty), and there has been industry speculation that Roche might decide to launch at risk (see "Roche Plans to Launch Anemia Biologic Miceria [sic] in U.S. Despite Court Setback"). Neither of those options are available to Roche in the face of Judge Williams’ injunction.

The Court’s injunction is pursuant to a jury judgment on October 23, 2007 that Mircera® infringed several Amgen patents. That verdict found Roche’s Mircera® infringed Claims 3, 7, and 8 of Amgen’s U.S. Patent No. 5,547,933 (claim 12 was found not to be literally infringed but infringed under the Doctrine of Equivalents); claims 1 and 2 of U.S. Patent No. 5,441,868; and claims 6 through 9 of U.S. Patent No. 5,618,698. (Amgen’s infringed claims were directed to recombinant methods and recombinant EPO protein.) In addition, the jury found that Roche had not sustained its burden of establishing that any of Amgen’s asserted claims were invalid (see "Amgen Survives Another EPO Challenge").

In its injunction order, the Court analyzed whether Amgen was entitled to an injunction using the four-factor test set forth by the Supreme Court in eBay Inc. v. MercExchange, L.L.C. The District Court relied upon the jury verdict that Amgen’s asserted claims were infringed and not invalid; in addition, the Court found that Amgen’s injury would not be adequately compensated merely with money damages, and that the balance of the hardships weighed in favor of granting the injunction. The most difficult prong for the Court to establish was the public interest, particularly in view of Roche’s representations of the advantages of its Mircera® product over Amgen’s version of EPO (including inter alia less frequent dosing; see "Long-Acting Drug for Dialysis Anemia Equivalent to Weekly Agent").

The Court did not make the injunction permanent, however, and announced that it "may modify" the injunction in 30 days, unless the Federal Circuit exercises jurisdiction by accepting an appeal (presumably from Roche). The District Court did indicate that it would impose the following conditions if it were persuaded (presumably by its considerations of the public interest) not to make the injunction permanent. First, Roche would pay Amgen a royalty of 22.5%; on February 20th, Amgen rejected an offer for a 20% royalty from Roche (see "Amgen Rejects Roche’s Micera [sic] License Payment Offer"). Second, Roche could be introduced to the Medicare patient population at a cost no less than the average sales price of Amgen’s EPO products (sold under the names Epogen® and Aranesp®) (a requirement that would prevent Roche from passing its royalty obligations onto patients, but would not prevent Roche from selling Mircera® at a bargain price relative to Epogen®). Third, Roche would have to provide clinical evidence to permit the Court to determine a "dosage conversion factor" between Mircera® and Epogen®. Fourth, Roche must pay for an independent agency to monitor sales and determine royalty payments owed to Amgen. Finally, Roche must agree to supply Mircera® to any patient needing it, at or below the authorized price (presumably, this is a provision that would prevent Roche from abandoning the Medicare market once it has entered it).

The Court also denied the various post-judgment motions (for judgment as a matter of law and a new trial) by the parties.
Conference & CLE Calendar

March 2, 2008

March 12, 2008 – Biotechnology, Chemical & Pharmaceutical Art Group Customer Partnership Meeting (U.S. Patent and Trademark Office)

March 17, 2008 – Recent Decisions: How They Affect Your Corporate IP Practice (Intellectual Property Owners Association) – Arlington, VA

March 30-April 1, 2008 – Advanced Courses (Patent Resources Group) – Bonita Springs, FL

March 31-April 1, 2008 – Document Management, E-Discovery, and Litigation Readiness (American Conference Institute) – New York, NY

April 3-5, 2008 – Advanced Courses (Patent Resources Group) – Bonita Springs, FL

April 7, 2008 – Successful Mulitlateral Patents (Law Seminars International) – Arlington, VA

April 10-12, 2008 – 23rd Annual Intellectual Property Law Conference (American Bar Association) – Arlington, Virginia

April 25, 2008 – Patent Claim Construction (Law Seminars International) – Atlanta, GA

April 30-May 1, 2008 – Pharma/Biotech Collaborative Agreements (American Conference Institute) – San Francisco, CA

May 28-30, 2008 – PharmaBiotech IP Summit (Worldwide Business Research) – Philadelphia, PA

June 17-20, 2008 – BIO International Convention (Biotechnology Industry Organization) – San Diego, CA

***Patent Docs is a media sponsor of this conference or CLE.

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