United States District Court, D. Delaware
NOVARTIS PHARMACEUTICALS CORPORATION and NOVARTIS AG, Plaintiff;
BRECKENRIDGE PHARMACEUTICAL, INC., Defendant. NOVARTIS PHARMACEUTICALS CORPORATION and NOVARTIS AG, Plaintiff;
WEST-WARD PHARMACEUTICALS INTERNATIONAL LIMITED, Defendant. NOVARTIS PHARMACEUTICALS CORPORATION and NOVARTIS AG, Plaintiff;
PAR PHARMACEUTICAL, INC., Defendant.
M. Silver, Esq., MCCARTER & ENGLISH, LLP, Wilmington, DE;
Nicholas N. Kallas, Esq., FITZPATRICK, CELLA, HARPER &
SCINTO, New York, NY; Christopher E. Loh, Esq., FITZPATRICK,
CELLA, HARPER & SCINTO, New York, NY; Charlotte Jacobsen,
Esq., FITZPATRICK, CELLA, HARPER & SCINTO, New York, NY;
Christina L. Schwarz, Esq., FITZPATRICK, CELLA, HARPER &
SCINTO, New York, NY. Attorneys for Plaintiffs
E. Farnan, Esq., RICHARDS, LAYTON & FINGER, PA,
Wilmington, DE; Selena Molina, Esq., RICHARDS, LAYTON &
FINGER, PA, Wilmington, DE; B. Jefferson Boggs, Jr., Esq.,
MERCHANT & GOULD PC, Alexandria, VA; Matthew L. Fedowitz,
Esq., MERCHANT & GOULD PC, Alexandria, VA; Christopher J.
Sorenson, Esq., MERCHANT & GOULD PC, Minneapolis, MN;
Rachel C. Hughey, Esq., MERCHANT & GOULD PC, Minneapolis,
MN; Daniel R. Evans, Esq., MERCHANT & GOULD PC, Atlanta,
GA. Attorneys for Defendant Breckenridge Pharmaceutical, Inc.
E. Moore, Esq., POTTER ANDERSON & CORROON LLP,
Wilmington, DE; Bindu A. Palapura, Esq., POTTER ANDERSON
& CORROON LLP, Wilmington, DE; Stephanie E. O'Byrne,
Esq., POTTER ANDERSON & CORROON LLP, Wilmington, DE;
Marta E. Gross, Esq., GOODWIN PROCTER LLP, New York, NY;
Keith A. Zullow Esq., GOODWIN PROCTER LLP, New York, NY;
Michael B. Cottier Esq., GOODWIN PROCTER LLP, New York, NY;
Steven J. Bernstein Esq., GOODWIN PROCTER LLP, New York, NY;
Naomi Birbach Esq., GOODWIN PROCTER LLP, New York, NY.
Attorneys for Defendant West-Ward Pharmaceuticals
J. Fineman, Esq., RICHARDS, LAYTON & FINGER, PA,
Wilmington, DE; Katharine L. Mowery, Esq., RICHARDS, LAYTON
& FINGER, PA, Wilmington, DE; Daniel G. Brown, Esq.,
LATHAM & WATKINS LLP, New York, NY; Roger J. Chin, Esq.,
LATHAM & WATKINS LLP, San Francisco, CA; Marc N. Zubick,
Esq., LATHAM & WATKINS LLP, Chicago, IL; Brenda L. Danek,
Esq., LATHAM & WATKINS LLP, Chicago, IL; Parker M.
Tresemer, Esq., LATHAM & WATKINS LLP, Los Angeles, CA.
Attorneys for Defendant Par Pharmaceutical, Inc.
Andrews, U.S. District Judge
brought these patent infringement actions against
Breckenridge Pharmaceutical, Inc., Roxane Laboratories,
Inc., and Par Pharmaceutical, Inc. in 2014.
(D.I. I). Breckenridge, Roxane, and Par each filed
an Abbreviated New Drug Application ("ANDA"),
seeking to engage in the commercial manufacture, use, and
sale of generic versions of Novartis's Zortress product.
(D.I. 141-1, ¶¶44, 52, 59). Plaintiffs allege that
these ANDAs infringe U.S. Patent No. 5, 665, 772 ("the
'772 patent"). Plaintiffs further allege that by
filing these ANDAs, Roxane and Breckenridge induced
infringement of U.S. Patent No. 6, 239, 124 ("the
'124 patent") and Roxane and Par induced
infringement of U.S. Patent No. 6, 455, 518 ("the
issue in these cases is the compound
40-O-(2-hydroxyethyl)-rapamycin, also referred to as
everolimus, which is the active ingredient in Novartis's
Zortress product. Everolimus is a derivative of the compound
rapamycin and is claimed in the '772 patent. The only
difference between rapamycin and everolimus is that the
hydroxyl group at the C-40 position in rapamycin is replaced
with a 2-hydroxyethyl group in everolimus. (Trial Transcript
has long been known to have beneficial medicinal properties,
such as antifungal activity (Tr. 96:11-12), anticancer
activity (Tr. 96:13-97:3), and immunosuppressive activity
(Tr. 95:2-10). Rapamycin is recognized as having limited
utility in pharmaceutical applications as it has low
bioavailability, high toxicity, and poor solubility.
('772 patent at 1: 36-40). Rapamycin derivatives such as
everolimus, however, have been shown to have better stability
and bioavailability, making them more desirable for
pharmaceutical preparations. (Id. at 1:41-45).
issue are methods of treating or preventing transplant
rejection using everolimus and one of a class of compounds
known as IL-2 transcription inhibitors. The '124 patent
claims the use of synergistically effective amounts of
cyclosporin A and everolimus in weight ratios from 2:1 to
180:1. The proposed labels for both Roxane's and
Breckenridge's generic products include instructions for
co-administration of cyclosporin A and everolimus for the
prevention and treatment of transplant rejection in kidney
transplant patients. (D.I. 130-1, ¶¶ 51, 58). The
'518 patent claims the use of synergistically effective
amounts of an IL-2 transcription inhibitor and everolimus in
weight ratios from 2:1 to 180:1. The proposed labels for both
Roxane's and Par's generic products include
instruction for co-administration of the IL-2 transcription
inhibitor FK506, also known as tacrolimus, and everolimus for
the prevention and treatment of transplant rejection in liver
transplant patients. (Id. at ¶¶ 58, 66).
Court held a bench trial on August 29-September 1, 2016.
Defendants concede that their proposed products meet all
limitations of the '772 patent. (D.I. 152 at 3).
Defendants argue that Plaintiffs have not proven by a
preponderance of evidence that Defendants induced
infringement of the '124 and '518 patents. Defendants
further argue that the '772, '124, and '518
patents are invalid as obvious and for obviousness-type
Obviousness-Type Double Patenting
double patenting is a judicially created doctrine that
'prohibit[s] a party from obtaining an extension of the
right to exclude through claims in a later patent that are
not patentably distinct from claims in a commonly owned
earlier patent.'" Pfizer, Inc. v. Teva Pharms.
USA, Inc., 518 F.3d 1353, 1363 (Fed. Cir. 2008)
(internal citation omitted). There are two steps to a
double-patenting analysis. First, the court construes the
claims of the commonly owned patents and identifies the
differences. See Pfizer, 518 F.3d at 1363 (citing
Eli Lilly & Co. v. Barr Labs., Inc., 251 F.3d
955, 967 (Fed. Cir. 2001)). In the second step of the double
patenting analysis, the court determines whether the
differences between the claims render them patentably
distinct. See Eli Lilly, 251 F.3d at 968. A later
claim that is obvious over, or anticipated by, an earlier
claim is not patentably distinct from it. See Id .
patent claim is invalid as obvious under 35 U.S.C. § 103
"if the differences between the subject matter sought to
be patented and the prior art are such that the subject
matter as a whole would have been obvious at the time the
invention was made to a person having ordinary skill in the
art to which said subject matter pertains." 35 U.S.C.
§ 103; see also KSR Int'l Co. v. Teleflex
Inc., 550 U.S. 398, 406-07 (2007). The determination of
obviousness is a question of law with underlying factual
findings. See Kinetic Concepts, Inc. v. Smith &
Nephew, Inc., 688 F.3d 1342, 1359-60 (Fed. Cir. 2012).
"The underlying factual inquiries include (1) the scope
and content of the prior art; (2) the differences between the
prior art and the claims at issue; (3) the level of ordinary
skill in the art; and (4) any relevant secondary
considerations ...." Western Union Co. v. Money Gram
Payment Sys., Inc., 626 F.3d 1361, 1370 (Fed. Cir. 2010)
(citing Graham v. John Deere Co., 383 U.S. 1, 17-18
is required to consider secondary considerations, or
objective indicia of nonobviousness, before reaching an
obviousness determination, as a "check against hindsight
bias." See In re Cyclobenzaprine Hydrochloride
Extended-Release Capsule Patent Litig., 676 F.3d 1063,
1078-79 (Fed. Cir. 2012). Relevant secondary considerations
include commercial success, long felt but unsolved needs,
failure of others, praise, unexpected results, and copying,
among others. Graham, 383 U.S. at 17-18; Ruiz v.
A.B. Chance Co., 234 F.3d 654, 662-63 (Fed. Cir. 2000);
Tex. Instruments, Inc. v. U.S. Int'l Trade Comm
'n, 988 F.2d 1165, 1178 (Fed. Cir. 1993). Secondary
considerations of nonobviousness are important because they
"serve as insurance against the insidious attraction of
the siren hindsight...." W.L. Gore & Assocs.,
Inc. v. Garlock, Inc., 721 F.2d 1540, 1553 (Fed. Cir.
patentee is not required to present evidence of secondary
considerations. See Prometheus Labs., Inc. v. Roxane
Labs., Inc., 805 F.3d 1092, 1101 (Fed. Cir. 2015). That
said, if the patent challenger establishes a prima facie case
of obviousness, "the patentee would be well advised to
introduce evidence sufficient to rebut that of the
challenger." Id. (quoting Pfizer, Inc. v.
Apotex, Inc., 480 F.3d 1348, 1360 (Fed. Cir. 2007)).
There must be enough evidence, however, for a finding that a
given secondary consideration exists by a preponderance of
the evidence. See Apple, Inc. v. Samsung Elec. Co.,
Ltd., 839 F.3d 1034, 1053 (Fed. Cir. 2016) (en banc). If
there is, then the probative value of each secondary
consideration will be considered in light of the evidence
produced. That does not mean, though, that the burden of
persuasion on the ultimate question of obviousness transfers
to the proponent of the secondary consideration. Pfizer,
Inc., 480 F.3d at 1359. That burden stays always with
the patent challenger. Id. at 1359- 60.
asserting that a patent is invalid as obvious must "show
by clear and convincing evidence that a skilled artisan would
have been motivated to combine the teachings of the prior art
references to achieve the claimed invention, and that the
skilled artisan would have had a reasonable expectation of
success in doing so." Pfizer, Inc. v. Apotex,
Inc., 480 F.3d 1348, 1361 (Fed. Cir. 2007). That
"expectation of success need only be reasonable, not
absolute." Id. at 1364. "Whether an
ordinarily skilled artisan would have reasonably expected
success .... is measured as of the date of the invention .
. . ." Amgen Inc. v. F. Hoffman-La Roche Ltd,
580 F.3d 1340, 1362 (Fed. Cir. 2009).
patent is infringed when a person "without authority
makes, uses, offers to sell, or sells any patented invention,
within the United States ... during the term of the
patent...." 35 U.S.C. § 271(a). A two-step analysis
is employed in making an infringement determination. See
Markman v. Westview Instruments, Inc., 52 F.3d 967, 976
(Fed. Cir. 1995) (en banc), aff'd, 517 U.S. 370
(1996). First, the court must construe the asserted claims to
ascertain their meaning and scope. See Id . The
trier of fact must then compare the properly construed claims
with the accused infringing product. See Id . This
second step is a question of fact. Bai v.L&L Wings,
Inc., 160 F.3d 1350, 1353 (Fed. Cir. 1998).
"Literal infringement of a claim exists when every
limitation recited in the claim is found in the accused
device." Kahn v. Gen. Motors Corp., 135 F.3d
1472, 1477 (Fed. Cir. 1998). "If any claim limitation is
absent from the accused device, there is no literal
infringement as a matter of law." Bayer AG v. Elan
Pharm. Research Corp., 212 F.3d 1241, 1247 (Fed. Cir.
2000). The patent owner has the burden of proving
infringement by a preponderance of the evidence. See
SmithKline Diagnostics, Inc. v. Helena Labs. Corp., 859
F.2d 878, 889 (Fed. Cir. 1988).
U.S.C. § 271(b) provides that "[w]hoever actively
induces infringement of a patent shall be liable as an
infringer." 35 U.S.C. § 271(b). "In order to
prevail on an inducement claim, the patentee must establish
first that there has been direct infringement, and second
that the alleged infringer knowingly induced infringement and
possessed specific intent to encourage another's
infringement." ACCO Brands, Inc. v. ABA Locks Mfrs.
Co., 501 F.3d 1307, 1312 (Fed. Cir. 2007) (internal
quotation marks omitted). In other words, "inducement
requires evidence of culpable conduct, directed to
encouraging another's infringement, not merely that the
inducer had knowledge of the direct infringer's
activities." DSU Med. Corp. v. JMS Co., 471
F.3d 1293, 1306 (Fed. Cir. 2006) (en banc). "[S]pecific
intent may be inferred from circumstantial evidence where a
defendant has both knowledge of the patent and specific
intent to cause the acts constituting infringement."
Ricoh Co. v. Quanta Computer Inc., 550 F.3d 1325,
1342 (Fed. Cir. 2008). "[L]iability for induced
infringement can only attach if the defendant knew of the
patent and knew as well that 'the induced acts constitute
patent infringement.'" Commil USA, LLC v. Cisco
Sys., Inc., 135 S.Ct. 1920, 1926 (2015) (quoting
Global-Tech Appliances, Inc. v. SEB S.A., 131 S.Ct.
2060, 2068 (2011)). The knowledge requirement may be
satisfied by showing actual knowledge or willful blindness.
See Global-Tech, 131 S.Ct. at 2068 (2011).
Hatch-Waxman cases alleging that a proposed drug label will
induce infringement by physicians, "The pertinent
question is whether the proposed label instructs users to
perform the patented method." AstraZeneca LP v.
Apotex, Inc., 633 F.3d 1042, 1060 (Fed. Cir. 2010).
"The label must encourage, recommend, or promote
infringement." Takeda Pharm. USA, Inc. v. West-Ward
Pharm. Corp., 785 F.3d 625, 631 (Fed. Cir. 2015).
"The mere existence of direct infringement by
physicians, while necessary to find liability for induced
infringement, is not sufficient for inducement."
Id. Rather, "specific intent and action to
induce infringement must be proven." Id.
(internal quotation marks omitted). Even where a proposed
label does not explicitly track the language of a claimed
method, a package insert containing directives that will
"inevitably lead some consumers to practice the claimed
method" provides sufficient evidence for a finding of
specific intent. See AstraZeneca, 633 F.3d at 1060;
see also Abraxis Bioscience, Inc. v. Navinta, LLC,
630 F.Supp.2d 553, 570 (D.N.J. 2009) ("Statements in a
package insert that encourage infringing use of a drug
product are alone sufficient to establish intent to encourage
direct infringement."), rev'd and vacated on
other grounds, 625 F.3d 1359 (Fed. Cir. 2010).
VALIDITY OF THE '772 PATENT
Findings of Fact
1. The '990 patent is a proper double-patenting reference
for the '772 patent.
2. The '772 and '990 patents are both assigned to
3. Each of claims 8, 9, 11-21, 25, and 27-35 of the '990
patent discloses all limitations of claims 1-3 and 10 of the
4. Each of claims 25 and 27-35 of the '990 patent
discloses all limitations of claim 7 of the '772 patent.
Conclusions of Law
to trial, the parties stipulated that the '990 patent
discloses all limitations of claims 1-3, 7, and 10 of the
'772 patent, and that the two patents are assigned to the
same entity and share named inventors. (D.I. 152 at 5).
The parties further stipulated "that if the Court finds
the '990 patent is a proper double-patenting reference to
the '772 patent, then the claims of the '990 patent
will render the Asserted Claims invalid for non-statutory
double patenting." (Id. at 4). Therefore, the
only issue to be decided is whether the '990 patent is a
proper double-patenting reference.
unusual facts of this case are the result of the Uruguay
Round Agreements Act ("URAA"), which changed how
patent terms are determined, effective as of June 8, 1995.
Any patent issuing from an application filed prior to June 8,
1995, received a term of seventeen years from the date of
issuance or twenty years from the earliest effective filing
date, whichever was longer. 35 U.S.C. § 154(c)(1).
Patents issuing from post-URAA applications receive a term of
twenty years from the earliest effective filing date. 35
U.S.C. § 154(a)(2).
issue in this case is that, through the operation of the
URAA, the '772 patent, which issued from an earlier filed
application, has a later expiration date than the later-filed
application that issued as the '772 patent was filed on
April 7, 1995 with an earliest effective filing date of
September 24, 1993. (D.I. 152 at 6). This pre-URAA patent
received a term of seventeen years from its issue date of
September 9, 1997. (Id. at 6-7). Although the
original expiration date of this patent was, therefore,
September 9, 2014, it received a patent term adjustment of
five years pursuant to 35 U.S.C. § 156 so that it now
expires on September 9, 2019. (Id. at 7).
application that issued as the '990 patent began life as
a divisional of the application that issued as the '772
patent. (Id. at 8). This application was filed in
1997, making it a post-URAA patent. It also has an earliest
effective filing date of September 24, 1993. (Id.).
This patent, therefore, received a term of twenty years from
the earliest effective filing date and expired on September
24, 2013. (Id.).
the Federal Circuit has not addressed the precise issue
presented in this case, the Court has addressed the issue of
whether a later-filed but earlier expiring patent can serve
as a double-patenting reference for an earlier-filed but
later-expiring patent. Gilead Sciences, Inc. v. Natco
Pharma Ltd., 753 F.3d 1208, 1212 (Fed. Cir. 2014). The
patents at issue in Gilead were both post-URAA
patents that were not part of the same family and, therefore,
had different priority dates. Id. at 1210. The
different priority dates led to a situation where the
later-filed patent expired before the earlier-filed patent.
Id. The Gilead court emphasized that the
"bedrock principle of our patent system" that the
prohibition on double patenting seeks to protect is the idea
that when a patent expires, the public is entitled to use the
invention and any obvious modifications of the invention
claimed in the patent. Id. at 1214. According to the
Federal Circuit, what matters in a double patenting analysis,
at least for post-URAA patents, is the expiration dates of
the patents. Id. at 1215. The Federal Circuit has
since revisited this question and made explicit that
"the doctrine of obviousness-type double patenting
continues to apply where two patents that claim the same
invention have different expiration dates." AbbVie,
Inc. v. Mathilda & Terence Kennedy Inst, of Rheumatology
Trust, 764 F.3d 1366, 1374 (Fed. Cir. 2014).
to the instant case is the fact that the Gilead
decision cites to a Board of Patent Appeals and Interferences
("BPAI" or "Board") decision with
substantially similar facts to the instant case. Id.
at 1211 n.2. In that case, the Board found that a later-filed
post-URAA patent with an expiration date in 2015 could serve
as a double-patenting reference for an earlier-filed pre-URAA
patent with an expiration date in 2019. Ex Parte Pfizer,
Inc., Patent Owner & Appellant, 2010 WL 532133, at
*16 (Bd. Pat. App. & Interf. Feb. 12, 2010). The Board
found that the later-expiring pre-URAA patent would
"extend Appellant's right to exclude the public from
practicing" the invention. Id. at *21. This,
the Board concluded, was "precisely what
obviousness-type double patenting was intended to
prevent." Id. This is the same reasoning
applied by the Gilead court. Gilead, 753
F.3d at 1214.
district courts have considered cases with facts
substantially identical to the instant case. In
Janssen, the district court faced the same question
and, in light of the Federal Circuit's decision in
Gilead, reached the conclusion that a later-filed
post-URAA patent with an earlier expiration date is a proper
double-patenting reference for an earlier-filed pre-URAA
patent with a later expiration date. See Janssen Biotech,
Inc. v. Celltrion Healthcare Co., Ltd., 2016 WL 5698362
(D. Mass. Sept. 28, 2016), appeal docketed, No.
17-1120 (Fed. Cir. Oct. 25, 2016). Other district courts have
also reached the same conclusion on identical facts. See
MLC Intellectual Property, LLC v. Micron Technology,
Inc., 2016 WL 4192009, at *3 n.4 (N.D. Cal. Aug. 9,
2016) ("The fact that the patents in Gilead
were governed by the URAA was not relevant to the Court's
reasoning."); DDB Technologies, LLC v. Fox Sports
Interactive Media, LLC, 2014 WL 12167628, at *3-4 (W.D.
Tex. May 15, 2014) (applying reasoning from Gilead
that "expiration date of the patents should
expend considerable effort attempting to distinguish this
case from Gilead. Plaintiffs argue first that
Defendants have misread Gilead. (D.I. 170 at 8).
According to Plaintiffs, double-patenting is an equitable
doctrine requiring Defendants to prove that the patentee has
obtained an unjustified extension of patent rights.
(Id. at 11). Plaintiffs argue strenuously that there
has been no unjustified extension of patent rights in this
case. (Id. at 15). I disagree. Gilead
reaffirms the long-standing principle that when a patent
expires, the public is entitled to make use of the claimed
invention. Gilead, 753 F.3d at 1214. The
"unjustified extension of patent rights" here is
the extension on the patent holder's term of exclusivity
past the expiration date of a patent that discloses the
invention. The patentee in this case chose to seek two
patents on the same invention. If the term of one of those
patents is allowed to extend past the expiration date of the
other, the patentee has obtained an unjustified extension of
next argue that Gilead and Abb Vie are inapplicable
because the patentees in those cases engaged in gamesmanship,
acting strategically to obtain the benefit of a later
expiration date. (D.I. 170 at 8-11). According to Plaintiffs,
Novartis's actions here are unlike those of the patentees
in Gilead and Abbvie because Novartis did
not violate any of the principles of double patenting.
(Id. at 14). Plaintiffs further argue that Novartis
has not engaged in gamesmanship. (Id. at 21). I
disagree that there is no violation of double patenting
principles and I find the argument about the absence of
gamesmanship irrelevant. A patentee need not engage in
gamesmanship or act strategically in order to violate the
principles of double patenting. Neither Gilead nor
AbbVie held that gamesmanship is required. A
patentee can obtain an unjustified extension of patent rights
without engaging in gamesmanship simply by seeking two
patents on the same invention, as the patentee did here. The
only relevant issue is the earlier expiration date of the
'990 patent, as it is the extension of the period of
exclusivity by virtue of the '772 patent's later
expiration date that violates the principles underlying the
double patenting prohibition. The patentee's motives are
next argue that expiration dates alone do not control the
double patenting analysis. (D.I. 170 at 17). According to
Plaintiffs, the holdings and reasoning in Gilead and
AbbVie are limited to the specific factual contexts
of those cases. (Id. at 17-18). While it may be true
that Gilead did not establish a hard and fast rule
that expiration dates control the double patenting analysis,
I am not persuaded that the facts of this case require a
different analysis. I think that the reasoning in
Gilead is equally applicable to the facts of this
case for the reasons I have already stated.
next argue that application of Gilead to the facts
of this case would frustrate legislative intent. (D.I. 170 at
19). Plaintiffs contend that allowing an earlier-expiring
post-URAA patent to serve as a double patenting reference for
a later expiring pre-URAA patent would effectively shorten
the statutorily mandated terms of pre-URAA patents.
(Id. at 19-20). Plaintiffs' argument misses the
mark. A patentee who chooses to seek a second
patent for an obvious variant of his invention, as the
patentee did here, runs this risk and cannot claim in
retrospect that only the later-expiring patent counts.
next argue that there is no harm to the public because
"Novartis has not enjoyed more than one patent term per
invention." (Id. at 20). According to
Plaintiffs, the '772 patent's expiration date
"is the same as it would have been had the '990
patent never issued." (Id.). This argument also
misses the mark. The patentee chose to file the application
that matured into the '990 patent. The patentee knew when
the '990 patent issued on August 27, 2002 that it would
expire before the '772 patent, which had issued five
years earlier. The harm to the public lies in the inability
to make use of an invention disclosed in an expired patent.
That the '772 patent's expiration date would be