What Are the Top Hatch-Waxman and BPCIA Developments for August 2018?

Morrison & Foerster LLP

Morrison & Foerster LLP

This month we highlight a district court opinion from Judge Dyk, sitting by designation, denying a preliminary injunction in a brand-vs-brand litigation, and a lengthy district court opinion from Judge Bryson, sitting by designation, addressing joint infringement, inherent anticipation and obviousness, and written description.


Federal Circuit

PTAB Got Priority Wrong

Otonomy, Inc. v. Auris Medical, AG, 08/01/18 (Fed. Cir. Nos. 2017-1850, 2017-1880)

In this appeal from an interference, the court first held that Auris was not entitled to the benefit of its PCT priority date because the PCT application does not teach the requisite suspension of fluoroquinolone, but rather a dissolved solution.  Moreover, Auris was not entitled to a priority date earlier than the preliminary amendment in which a claim matching the interference count was presented, because there was no written description absent that amendment.  Accordingly, the court reversed the priority finding by the PTAB.  Finally, the court rejected Auris’ cross-appeal stating that the PTAB erred in not finding anticipation of Otonomy’s involved claims.   Substantial evidence supported the Board’s conclusion that nothing in the reference would lead a skilled artisan to “pick and choose among the elements of the disclosure to arrive at a suspended-fluoroquinolone composition as claimed.”

District Court

Preliminary Injunction Prevents Generic Launch

Allergan Sales LLC v. Sandoz, Inc., 08/02/18 (D.N.J. Civ. No. 2:17-cv-10129 (WHW)(CLW)) – subscription required

In a redacted opinion released on August 2 in this ANDA litigation, the district court preliminarily enjoined Sandoz from launching its generic product.  The court first addressed the construction of certain “whereas” clauses concerning efficacy and reduced adverse events, holding them to be limitations on the claims.  Based on this construction, the district court found plaintiffs likely to succeed on the merits, asdefendants’ invalidity arguments were based on a non-limiting construction of the “whereas” clauses.  Defendants’ inequitable conduct argument likewise failed to raise a substantial question.  The remaining preliminary injunction factors all favored plaintiffs.

Court Denies Preliminary Injunction Against Branded Competitor

Baxalta Inc. v. Genentech, Inc., 8/7/18 (D. Del. Civ. Action No. 17-509-TBD)

In an opinion by Judge Dyk, sitting by designation, the court denied Baxalta’s motion for a preliminary injunction against the sale of Helimbra®.  Regarding the likelihood of success, the court first analyzed the parties’ claim construction dispute, which centered on the meaning of the term “antibody.”  Genentech’s proposed construction excluded bispecific antibodies such as Helimbra; Baxalta’s included them.  The court concluded that both sides presented “substantial arguments” regarding infringement.  Addressing written description next, the court found a substantial question regarding validity and that “[t]hese difficult merits questions weight in favor of denying injunctive relief at this stage.” 

The court then found that Baxalta had “failed to establish substantial irreparable harm from price erosion or lost sales or market share” and also rejected its goodwill and reputational harm arguments.  Regarding reputational harm, the court agreed with Genentech’s witness that, “if anything[,] Baxalta’s reputation [stood] to be harmed by [grant of] an injunction.”  Relying on Helimbra’s “unique medical benefits,” the court found that “the public interest weighs strongly against” an injunction. 

Forging Ahead With No Tenable Infringement Theory Is Exceptional

Phigenix, Inc. v. Genentech, Inc., 8/13/18 (N.D. Cal. Case No. 15-cv-01238-BLF)

The district court granted Genentech’s motion for an exceptional case finding and attorney’s fees. “While some of Phigenix’s conduct standing alone would not be independently sanctionable, the Court conclude[d] that taken as a whole, there came a point in this case when Phigenix’s continued prosecution of the case became ‘exceptional.’”  The district court found that “Phigenix’s behavior in the face of losing the 2005 priority date reflect[ed] its unreasonable determination to forge ahead with prolonged litigation when it had no tenable theory of infringement.”  Moreover, Phigenix then, “in a stunning change of course,” altered its claim construction.  “Phigenix’s maneuver [was] particularly egregious as it [was] apparent that the late disclosed new theory was proffered to avoid anticipation of the ’534 patent which Phigenix was repeatedly warned about throughout the litigation.”  The court then granted Genentech’s motion under FRCP 19(a) to join Phigenix’s “controlling shareholder” as a party.

Using Man-made Compound to Amplify Natural Phenomenon Patent Eligible

Genzyme Corp. v. Zydus Pharmaceuticals (USA) Inc., 08/08/18 (D. Del. Civil Action No. 16-540 (KAJ)) – subscription required

In this ANDA litigation (Jordan, J., sitting by designation), the court found the asserted claims not invalid or patent ineligible.  After a lengthy discussion regarding the conception date for the claimed invention, the court found that, while one skilled in the art would have been motivated to combine certain prior art references, the skilled artisan would not have had a reasonable expectation of success.  Secondary considerations, including long-felt need, unexpected results, and praise for the invention, also supported the non-obviousness of the claimed invention. 

The court next addressed the patent eligibility of the claims, which essentially recited a method to obtain progenitor and/or stem cells from a subject comprising administering plerixafor in an amount sufficient to mobilize such cells into the peripheral blood and harvesting the cells by apheresis.  The court first found that the claims were directed to patentable subject matter.  According to the court, “they claim using plerixafor, itself a compound that does not naturally exist, to amplify a natural phenomenon-stem cell mobilization-in an unnatural way.”  It also held that the claims recite an inventive concept that likewise renders them patent eligible “because it was not understood, routine, or conventional at the time of the invention to use plerixafor to mobilize stem cells from the bone marrow into the peripheral blood.” 

TRO and Preliminary Injunction Against At-Risk Launch Denied

Noven Pharmaceuticals, Inc. v. Mylan Technologies, Inc., 8/20/18 (D. Del. C.A. No. 17-1777-LPS) – subscription required

The district court denied Noven’s motion for a temporary restraining order against the at-risk launch of Mylan’s generic product.  The court noted that it was treating the motion as seeking both a TRO and a preliminary injunction.  Noven failed to prove likelihood of success on the merits on infringement, turning on the interpretation of the term “estradiol flux.”  The court also found that Noven had not shown that Mylan’s written description and indefiniteness defenses lacked substantial merit.  The court did grant a limited 2-day TRO (later extended to 10 days) to permit Noven to seek a stay pending appeal.

Noven filed an appeal, which it later dismissed because the parties had “agreed to settle and resolve all disputes. . . and have entered into a confidential settlement agreement.”

Polynucleotide Not Limited to Only Specified Protein

Immunex Corp. v. Sandoz Inc., 8/20/18 (D.N.J. Civil Action No.: 16-1118-CCC-MF) – subscription required

In this BPCIA case, the court construed the term “wherein the polynucleotide encodes a protein consisting of.”  More specifically, the court addressed whether the “consisting of” language limited the protein such that “the polynucleotide cannot contain nucleic acid sequences

that code for amino acid sequences other than those listed in the claim,” even more specifically, a signal peptide sequence.  Based on its review of the intrinsic and extrinsic evidence, the court declined to adopt that limiting construction. 

Court Addresses What It Means to be Human

Immunex Corp. v. Sanofi, 8/24/18 (C.D. Cal. CV-17-02613 SJO) – subscription required

In this antibody case, the court construed the terms “competes” and "binding affinity (Ka)" rejecting defendants’ arguments that these terms were indefinite, and adopting plaintiff’s proposed constructions.  The court also interpreted the term “human antibody,” noting that “[f]or all intents and purposes, the parties are vesting the Court with the rather weighty task of determining what it means to be ‘human.’”  Based on the particular facts presented, the court construed the term as “fully human antibody.”

Judge Bryson on Joint Infringement, Inherent Anticipation/Obviousness, and Written Description

Pernix Ireland Pain DAC v. Alvogen Malta Operations Ltd., 8/24/18 (D. Del. Civil Action No. 16-139-WCB)

In this Hatch-Waxman case, the district court (Judge Bryson sitting by designation) addressed joint direct infringement by physicians and patients of method of use claims and induced infringement.  The court found “that physicians and patients would jointly infringe the two-step claims, because the patients would self-administer the drugs pursuant to the physicians’ direction and control,” and that Alvogen’s label would induce that direct infringement.  According to the court, the case law does not impose a “strict categorical conditioning requirement” in order to find direction and control.  Rather, “[d]irection or control can be shown where an actor crosses the line from merely guiding or instructing to conditioning, even if the conditioning is not categorical in nature.” 

The court next addressed Alvogen’s inherent anticipation argument, finding that a general method of treatment did not inherently anticipate treatment of a special population:  “if a general method-of-treatment claim were deemed to inherently disclose the treatment of all possible special populations, no subsequent patent claiming the treatment of a special population.”  The court did find, however, that all of the asserted claims were obvious in view of the prior art, again addressing inherency, this time in the obviousness context. 

Finally, the court held that the asserted claims lacked adequate written description.  The patent specification’s single embodiment of the claimed invention did not suffice:  “The problem with the claims is that the specification provides no basis for believing that all species falling within the genus display the functional features of the single embodiment that was tested for those features.”   

District Court Will Not Set Aside $70 Million Jury Award Against Hospira

Amgen Inc. v. Hospira Inc., 08/27/18 (D. Del. Civil Action No. 15-839)

Following a jury trial in this Epogen® BPCIA litigation, the court denied Hospira’s post-trial motions.  The jury found that the safe harbor of section 271(e) did not apply to 14 of the 21 accused drug substance batches manufactured by Hospira.  The court concluded that substantial evidence supported the jury’s verdict, citing “Amgen’s presentation of FDA guidance documents, admissions in Hospira’s internal documents, and post-litigation changes to Hospira’s representations to the FDA,” all of which “challenged Hospira’s assertion that each batch at issue was covered by the safe harbor.”  The court held that “a party’s stated intent may be considered as part of whether the manufacture or use of a patented drug was ‘solely for uses reasonably related to’ obtaining FDA approval.”  

The court upheld all of the jury’s findings on infringement and validity, including denying Amgen’s post-trial motions on one patent that the jury found not to be infringed.  Finally, the court found that the jury’s lump-sum reasonable-royalty award was appropriate, both in nature and amount, and awarded Amgen pre- and post-judgment interest.

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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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