Solicitor General Recommends That Supreme Court Deny Certiorari in Hikma Pharmaceuticals v. Vanda Pharmaceuticals

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On Friday, December 6, 2019, the United States filed its brief in response to the March 18, 2019 order of the Supreme Court inviting the Solicitor General to express the views of the United States on the petition for certiorari filed by Petitioners Hikma Pharmaceuticals USA Inc. and Hikma Pharmaceuticals International Ltd. in Hikma Pharmaceuticals USA Inc. v. Vanda Pharmaceuticals Inc.  The Solicitor General concluded that "[i]n the view of the United States, the petition for a writ of certiorari should be denied," stating that the case was "not an optimal vehicle for bringing greater clarity [to the Court's recent § 101 precedents] because the court of appeals majority arrived at the correct result."

The brief begins by explaining that the case concerns claims for methods of using human-made drugs to treat medical conditions.  The dispute between the parties began when Vanda sued Hikma (at the time known as West-Ward Pharmaceuticals International Ltd.) for infringement of U.S. Patent No. 8,586,610, which relates to methods of treating patients suffering from schizophrenia with iloperidone.  Representative claim 1 of the '610 patent recites:

1.  A method for treating a patient with iloperidone, wherein the patient is suffering from schizophrenia, the method comprising the steps of:
    determining whether the patient is a CYP2D6 poor metabolizer by:
        obtaining or having obtained a biological sample from the patient; and
        performing or having performed a genotyping assay on the biological sample to determine if the patient has a CYP2D6 poor metabolizer genotype; and
    if the patient has a CYP2D6 poor metabolizer genotype, then internally administering iloperidone to the patient in an amount of 12 mg/day or less, and
    if the patient does not have a CYP2D6 poor metabolizer genotype, then internally administering iloperidone to the patient in an amount that is greater than 12 mg/day, up to 24 mg/day,
    wherein a risk of QTc prolongation for a patient having a CYP2D6 poor metabolizer genotype is lower following the internal administration of 12 mg/day or less than it would be if the iloperidone were administered in an amount of greater than 12 mg/day, up to 24 mg/day.

As the brief explains, the '610 patent describes that some patients have a variation (genotype) of a particular gene (CYP2D6) that results in poor metabolization of iloperidone, which in turn can lead to a dangerous heart condition called QTc prolongation.

The District Court determined that Hikma's proposed products would infringe Vanda's patent, rejecting Hikma's argument that the '610 patent claimed a patent-ineligible natural law.  The Federal Circuit affirmed, with the majority (Judges Lourie and Hughes) concluding at step one of its Mayo/Alice analysis that the claims of the '610 patent are patent-eligible because they are not directed to a patent-ineligible natural law, but rather are "directed to a novel method of treating a disease."  As explained in the Solicitor General's brief, "[t]he majority explained that, although '[t]he inventors recognized the relationships between iloperidone' and genetically linked side effects, they had not claimed the relationship itself, but instead had 'claimed an application of that relationship' that requires the administration of a specific dosage, 'depending on the result of a genotyping assay.'"  The brief also explained that Chief Judge Prost, writing in dissent, "stated that, '[w]hatever weight can be ascribed to' Mayo's suggestion that 'a new way of using an existing drug' may be patent-eligible, lower courts 'remain beholden' to what she described as Mayo's contrary 'holding.'"  Following the Federal Circuit's denial of rehearing en banc, the Hikma filed a Petition for a Writ of Certiorari, offering the following Question Presented:

Whether methods of using drugs to treat medical conditions are patent-eligible processes under Section 101.

In summarizing the position of the United States, the Solicitor states that:

The court of appeals correctly held that the relevant claims of Vanda's patent constitute patent-eligible subject matter under 35 U.S.C. 101.  Those claims encompass methods of medical treatment.  Historically, such methods were well understood to be patent-eligible.

The decision below, however, implicates important and recurring questions on which the Court's recent Section 101 decisions have fostered substantial uncertainty.  In particular, Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U.S. 66 (2012), has sent conflicting signals.  Language in that opinion indicates that the Court did not intend to overturn the well-settled understanding that method-of-medical treatment claims typically are patent-eligible.  But the decision's logic arguably implies the opposite.  The disagreement between the majority and dissenting opinions below reflects that internal inconsistency.

Although Mayo is the most immediate source of confusion, the uncertainty ultimately stems from the broader framework articulated in the Court's recent Section 101 decisions.  The Court's reconceptualization in Bilski v. Kappos, 561 U.S. 593 (2010), of inherent, long-recognized limitations on Section 101's affirmative scope as freestanding, atextual "exceptions," id. at 601, has given rise to an array of difficult questions.  The confusion created by this Court's recent Section 101 precedents warrants review in an appropriate case.

This case, however, is not an optimal vehicle for bringing greater clarity because the court of appeals majority arrived at the correct result.  In cases involving medical-diagnostic methods, by contrast, the Federal Circuit's recent decisions suggest that the court might well have reached different outcomes if it were not bound by the Mayo framework.  The Court should await a case in which lower courts' confusion about the proper application of Section 101 and this Court's precedents makes a practical difference.

The latter half of the brief is spent fleshing out the summary above.

While acknowledging the historical understanding that a method of using a drug to treat a medical condition constitutes patent-eligible subject matter, the brief notes that "the Court's recent Section 101 decisions leave the proper analysis of such claims unclear."  In support of that historical understanding of patent eligibility, the brief points to the "tens of thousands of patents that included at least one method-of-treatment claim" that the U.S. Patent and Trademark Office has issued since enactment of the 1952 Patent Act (although it should be noted that a similar argument failed to sway the Court in Association for Molecular Pathology v. Myriad Genetics, Inc.) and Congress' enactment of the Hatch-Waxman Act in 1984, which the brief suggests contains "provisions [that] assume that claims for methods of medical treatment, including methods that involve the administration of drugs to patients, are potentially patent-eligible."

As for the Court's decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc., the brief states that:

The Mayo Court . . . appeared to take as its premise that methods of medical treatment are patent-eligible.  Nevertheless, as evidenced by the dissenting opinion below, it is arguably unclear how the longstanding and entirely correct rule that method-of-treatment claims are patent-eligible can be reconciled with mechanical application of Mayo's two-step framework.

The brief argues that the Mayo Court's application of "a new and capacious understanding of patent-ineligible 'laws of nature'" was significant in two respects.  First, the brief asserts that the Mayo Court departed from the prior distinction under § 101 between products of nature and human-made inventions by describing as "laws of nature" biological responses of the human body to conditions that arise solely from human intervention.  Second, the brief contends that the Mayo Court defined the natural law it identified at an extremely high level of specificity, noting that "[w]hen highly specific relationships of that sort are treated as laws of nature, it becomes more difficult for a patent applicant to show that its invention goes substantially beyond an instruction to 'apply the law.'"  With respect to the difficulty of applying Mayo's two-step framework, the brief points out that:

[I]f mechanical application of Mayo's approach leads to the conclusion that the metabolizing of a drug, as in Mayo, is an "entirely natural process[ ]"—merely illustrating a natural law that "exists in principle apart from any human action," 566 U.S. at 77—the same would arguably be true of the biological reactions involved in Vanda's process.  And if the precise mathematical correlations in Mayo qualify for this purpose as "laws of nature," ibid., the same would arguably be true of the highly particularized relationships on which Vanda's treatment method is premised.

And the brief continues:

Indeed, it is arguably unclear whether even a method of treating disease with a newly created drug would be deemed patent-eligible under a mechanical application of Mayo's two-part test.  The proposition that a specified dosage of a new drug has therapeutic benefits for a particular class of patients would seem to constitute a "law of nature" under Mayo's expansive conception of that term.  And once that therapeutic benefit has been identified, an instruction to administer the drug in the specified dosage to the relevant patients might be viewed as nothing more than routine and conventional activity.  The patent-eligibility of such method-of-treatment claims has long been settled, and the Mayo Court did not suggest that it intended such an avulsive effect on established practices.  The potential for rote application of the Mayo two-step framework to call into question such bedrock understandings of the patent system, in a way that the Mayo Court clearly did not envision, suggests that the Mayo framework warrants reconsideration [emphasis in brief].

As for the Federal Circuit's handling of the case, the brief contends that the majority and dissenting opinions "illustrate the conflicting strands within the Mayo opinion."  The brief also suggests that "[t]he current uncertainty as to the proper application of the Mayo framework has considerable practical consequences for various types of medical innovations," with some commentators "liken[ing] Mayo's analysis to an elusive 'I-know-it-when-I-see-it' standard."  The brief also argues that the USPTO's ability to provide direction to its examining corps and administrative patent judges "is constrained by the lack of clarity in judicial precedent."

According to the Solicitor General's brief, "[t]he present difficulties in applying Section 101 ultimately derive in substantial part from the Bilski Court's reconceptualization of the limits on Section 101's coverage as freestanding 'exceptions,' 561 U.S. at 601, rather than as context-sensitive interpretations of the provision’s terms."  The brief states that:

[T]he Bilski Court . . . recast decades of precedent recognizing internal limits on Section 101's reach as "exceptions" that the Court acknowledged "are not required by" Section 101's language.  Id. at 601.  That approach decoupled the Section 101 analysis from the statutory text and context, necessitating an alternative methodology for ascertaining the scope of the exceptions and identifying claims that implicate them.

Mayo and later decisions demonstrate the difficulty of that task.  Mayo "set forth a framework" that Alice distilled to two "step[s]."  Alice, 573 U.S. at 217.  First, courts must ask "whether the claims at issue are directed to one of th[e] patent-ineligible concepts."  Ibid.  Second, "[i]f so," courts must "ask, 'what else is there in the claims,'" while effectively disregarding activities that are "'well-understood, routine, [and] conventional.'"  Id. at 217, 225 (quoting Mayo, 566 U.S. at 73, 78) (brackets omitted).  Both steps have proven problematic.

The brief argues that the Supreme Court's instruction that courts inquire at the first step of the Mayo/Alice analysis whether a patent is "directed at" a law of nature, natural phenomenon, or abstract idea "provides little guidance," and contends that "[t]he second step is similarly ambiguous."  Citing the Court's decision in Alice Corp. Pty. Ltd. v. CLS Bank Int'l, the brief notes that:

Within a single post-Mayo opinion, the Court variously articulated that step as a query regarding "what else is there in the claims"; an examination of "whether the additional elements transform the nature of the claim into a patent-eligible application"; "a search for an inventive concept"; an inquiry into any "additional features to ensure that the claim is more than a drafting effort designed to monopolize" the abstract idea or natural law; a review of whether the claims do "more than simply stating the abstract idea while adding the words 'apply it'"; an evaluation of whether a patent does more than merely "limit the use of an abstract idea to a particular technological environment"; and a determination whether additional features are "well-understood, routine, conventional activit[ies]" previously known to the industry.

In addition to the ambiguity of the second step of the Mayo/Alice framework, the brief argues that the second step "causes the Section 101 inquiry to overlap with the application of other Patent Act provisions," adding that "to the extent Mayo's approach screens out routine activity and considers only those discrete steps that are independently new, it replaces the traditional statutory focus on the invention 'as a whole,' . . . with a more demanding test."

Despite the problems with the Mayo/Alice two-step framework, the brief ultimately concludes that:

This case . . . is not an optimal vehicle to address the confusion stemming from this Court's recent Section 101 decisions.  Despite that uncertainty, the court of appeals majority reached the correct result in concluding that the method of medical treatment claimed in Vanda's patent is patent-eligible subject matter.

Instead, the brief suggests that the Court "should provide additional guidance in a case where the current confusion has a material effect on the outcome of the Section 101 analysis," offering as one example a case involving the patent eligibility of medical-diagnostic methods, and pointing in particular to Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC.  The brief notes that in contrast with Vanda, where rehearing was denied by the Federal Circuit without dissent, "the Federal Circuit's recent order denying rehearing en banc in Athena was accompanied by multiple separate opinions articulating different understandings of Mayo and seeking clarification from this Court."  The brief argues that the eight opinions in the Athena order "provide substantial grounds for inferring that, if the Federal Circuit were not bound by the current Section 101 framework, that court might have reached different outcomes in Athena itself and in other diagnostic-method cases."

The Solicitor General concludes the brief by recommending that the petition for a writ of certiorari in Vanda be denied, and proposing as an alternative that the petition be held pending the Court's decision in Athena, in the event the Court grants the petition for certiorari in that case.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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