Allergan v. Watson: Federal Circuit appeal brief
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Transcript of Allergan v. Watson: Federal Circuit appeal brief
2012-1310
UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT
ALLERGAN, INC., ALLERGAN USA, INC., ALLERGAN SALES, LLC, ENDO PHARMACEUTICALS SOLUTIONS INC.,
and SUPERNUS PHARMACEUTICALS, INC., Plaintiffs Appellants,
v.
WATSON LABORATORIES, INC. – FLORIDA, Defendant-Appellee,
and
SANDOZ INC., Defendant-Appellee,
and
PADDOCK LABORATORIES, INC., Defendant-Appellee.
Appeal from the United States District Court for the District of Delaware in consolidated case 09-CV-0511, Chief Judge Gregory M. Sleet
RESPONSIVE BRIEF OF DEFENDANT-APPELLEE WATSON LABORATORIES, INC. – FLORIDA
Charles A. Weiss Cynthia Lambert Hardman KENYON & KENYON LLP One Broadway New York, NY 10004-1007 (212) 425-7200
John W. Bateman KENYON & KENYON LLP 1500 K Street, NW Washington, DC 20005-1257 (202) 220-4200
Attorneys for Defendant-Appellee Watson Laboratories, Inc. – Florida June 1, 2012
CERTIFICATE OF INTEREST
Counsel for Appellee-Watson Laboratories, Inc. – Florida certifies the following: 1. The full name of every party or amicus represented by me is: Watson Laboratories, Inc. – Florida. 2. The name of the real party in interest (if the party named in the caption is not
the real party in interest) represented by me is: Watson Laboratories, Inc. – Florida. 3. All parent corporations and any publicly held companies that own 10 percent
or more of the stock of the party or amicus curiae represented by me are:
Watson Laboratories, Inc. – Florida is owned by Andrx Corporation which is a wholly owned subsidiary of Watson Pharmaceuticals, Inc. By virtue of this arrangement, Watson Pharmaceuticals, Inc. is a publicly held corporation that owns more than 10% of Watson Laboratories, Inc. – Florida.
4. The names of all law firms and the partners or associates that appeared for
the party or amicus now represented by me in the trial court or agency or are expected to appear in this court are:
KENYON & KENYON LLP: Charles A. Weiss, John W. Bateman, Cynthia Lambert Hardman, Brian J. Robinson; RICHARDS, LAYTON & FINGER, P.A.: Chad M. Shandler, Stephen M. Ferguson, Travis S. Hunter.
Dated: June 1, 2012 /s/ Charles A. Weiss CHARLES A. WEISS
TABLE OF CONTENTS
Page
-ii-
STATEMENT OF RELATED CASES....................................................................1
COUNTER-STATEMENT OF THE ISSUES .........................................................2
COUNTER-STATEMENT OF THE CASE ............................................................4
COUNTER-STATEMENT OF FACTS...................................................................5
I. Trospium Was An Old Drug With Known Properties That Made It An Appealing Candidate For A Once-A-Day Product...........5
II. Shire Used Its Existing Multiparticulate Platform—Already Implemented In Two Marketed Extended-Release Products And Well-Described in the Patent Literature—To Formulate Once-Daily Trospium and Quickly Achieved Success........................7
III. The Applicants Obtained Allowance of the Patents By Representing That Trospium Was Known To Have Negligible Absorption In The Colon, Arguing That Federal Circuit Law Made Extended-Release Claims Nonobvious If the Drug Was Not Thought To Be Absorbed in the Colon .........................................8
SUMMARY OF THE ARGUMENT .....................................................................11
ARGUMENT ..........................................................................................................15
I. Standard of Review ............................................................................15
II. The District Court Did Not Commit Legal Error...............................16
A. The District Court Did Not Fall Into Hindsight.......................16
B. Allergan Invited the District Court to Determine if It Rebutted Prima Facie Obviousness With Evidence of Secondary Considerations........................................................17
C. The Result in Cyclobenzaprine Does Not Mandate Reversal....................................................................................21
III. The District Court’s Factual Findings Are Not Clearly Erroneous............................................................................................24
A. The Testimony By Indevus Employee Dr. Sandage of Alleged Failures and Skepticism By Madaus AG And Bayer Pharmaceuticals Was Hearsay Not Subject To Any Exception .................................................................................24
TABLE OF CONTENTS (continued)
Page
-iii-
B. Allergan’s Attempts to Substitute Madaus and Dr. Fuhr for the Hypothetical Person of Ordinary Skill in the Art Are Improper as a Matter of Law ............................................25
C. The Scope and Content of the Prior Art ..................................26
1. The District Court Correctly Found That Art Suggested Use of Multiparticulate Formulations..........26
2. The District Court Correctly Found That Trospium Would Have Been Considered for Modified-Release Formulation ......................................................28
(a) Allergan’s New Argument Concerning IV/IVC Lacks Factual Support............................28
(b) The District Court’s Finding That a POSA Would Consider Trospium for Once-Daily Formulation Is a Factual Determination and Not Clearly Erroneous.........................................31
(c) The Prior Art Demonstrated Colonic Absorption of Trospium......................................31
(d) The Pharmacokinetic Parameters of Trospium were Known and Would Have Been Considered By a Person of Ordinary Skill in the Art as a Positive Factor in Formulating ER Trospium ..................................35
(e) The Half-Life of Trospium Was Known and Would Have Been Considered By a Person of Ordinary Skill in the Art as a Positive Factor in Formulating ER Trospium...................36
3. A Person of Ordinary Skill in the Art Would Have Known to Increase the Amount of Trospium Released in the Colon to Increase Absorption ..............37
4. The District Court Correctly Found Motivation to Formulate Trospium as Once-a-Day Extended-Release Formulation ......................................................38
D. Differences Between the Claims and Prior Art .......................40
TABLE OF CONTENTS (continued)
Page
-iv-
1. Controlled-Release Multiparticulates Were Legion in the Prior Art ...............................................................41
2. The Prior Art Taught Releasing Drug in the Colon for Extended-Release Formulations ..............................42
3. Steady-State Blood Levels and PK Parameters of Immediate-Release Trospium Are In the Prior Art .......43
E. There Was No Evidence Showing Objective Indicia of Nonobviousness .......................................................................45
1. Allergan Failed to Present Evidence of Long-Felt Need ...............................................................................45
2. There Is No Evidence Anyone Failed Making Once-Daily Trospium ....................................................46
3. Bayer and Madaus’ Alleged Skepticism Does Not Show Nonobviousness...................................................48
4. The Schröder Poster Teaches Toward, Not Away From, the Asserted Claims ............................................49
5. Licensing by Others.......................................................51
F. Reasonable Expectation of Success .........................................53
IV. The District Court Erred in Concluding that Watson Infringed the Method Claims .............................................................................54
A. Allergan Did Not Prove, and Indeed Disproved, that Watson’s Product Meets the Steady-State Cmax Element of Claim 1 of the ’359 Patent...................................................54
B. Allergan Did Not Prove Inducement of the Asserted Method Claims.........................................................................58
1. Allergan Did Not Prove Indirect Infringement of the ’359 Patent By Inducement .....................................58
2. Allergan Did Not Prove Indirect Infringement of the ’449 Patent By Inducement .....................................59
v
TABLE OF AUTHORITIES Page(s)
Cases
Abbott Labs. v. Sandoz, Inc., 544 F. 3d 1341 (Fed. Cir. 2008) ............................................................. 29, 30
Adams Respiratory Therapeutics v. Perrigo Co., 616 F.3d 1283 (Fed. Cir. 2010) .....................................................................57
Alza Corp. v. Mylan Labs., Inc., 391 F.3d 1365 (Fed. Cir. 2004.) ...................................................................17
Alza Corp. v. Mylan Labs., Inc., 464 F.3d 1286 (Fed. Cir. 2006) ............................................................. passim
Amazon.com, Inc. v. Barnesandnoble.com, Inc., 239 F.3d 1343 (Fed. Cir. 2001) .....................................................................25
Anderson v. Bessemer City, 470 U.S. 564 (1985).......................................................................................15
Cordis Corp. v. Medtronic Ave, Inc., 511 F.3d 1157 (Fed. Cir. 2008) .....................................................................18
Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809 (1986).......................................................................................15
Desper Prods., Inc. v. QSound Labs, Inc., 157 F.3d 1325 (Fed. Cir. 1998) .....................................................................56
Giles v. Kearney, 571 F.3d 318 (3d Cir. 2009) ..........................................................................15
Glassroth v. Moore, 335 F.3d 1282 (11th Cir. 2003) .....................................................................18
Glaxo, Inc. v. Novopharm, Ltd., 110 F.3d 1562 (Fed. Cir. 1997) .............................................................. 56, 57
Global-Tech Appliances, Inc. v. SEB S.A., 131 S. Ct. 2060 (2011)...................................................................................58
vi
Graham v. John Deere Co., 383 U.S. 1 (1966)................................................................................... passim
In re Cyclobenzaprine Hydrochloride Extended-Release Capsule Patent Litigation, 676 F.3d 1063 (Fed. Cir. 2012) ............................................................. passim
In re Fulton, 391 F.3d 1195 (Fed. Cir. 2004) .....................................................................50
In re Gurley, 27 F.3d 551 (Fed. Cir. 1994) .........................................................................50
KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398 (2007).......................................................................................54
Leapfrog Enters., Inc. v. Fisher-Price, Inc., No. 03-927-GMS, 2006 WL 891001 (D. Del. Mar. 30, 2006) .....................18
Leapfrog Enters., Inc., v. Fisher-Price, Inc., 485 F.3d 1157 (Fed. Cir. 2007) .............................................................. 18, 19
Lincoln v. Board of Regents, 697 F.2d 928 (11th Cir. 1983) .......................................................................20
Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318 (Fed. Cir. 2008) .....................................................................49
Nagy v. L. Mundet & Son, Inc., 101 F.2d 82 (2d Cir. 1939) ............................................................................47
O2 Micro Int’l Ltd. v. Beyond Innovation Tech. Co., 449 Fed. Appx. 923 (Fed. Cir. 2011) ............................................................18
Pan Am. World Air., Inc. v. Aetna Cas. & Sur. Co., 505 F.2d 989 (2d Cir. 1974) ..........................................................................23
Para-Ordinance Mfg., Inc. v. SGS Importers Int’l, Inc., 73 F.3d 1085 (Fed. Cir. 1995) .......................................................................49
PharmaStem Therapeutics, Inc. v. Viacell, Inc., 491 F.3d 1342 (Fed. Cir. 2007) .....................................................................48
vii
Princeton Biochemicals, Inc. v. Beckman Coulter, Inc., 411 F.3d 1332 (Fed. Cir. 2005) .....................................................................16
Pullman-Standard v. Swint, 456 U.S. 273 (1982).......................................................................................21
Rothman v. Target Corp., 556 F.3d 1310 (Fed. Cir. 2009) .....................................................................25
Ruiz v. A.B. Chance Co., 357 F.3d 1270 (Fed. Cir. 2004) .....................................................................16
SIBIA Neurosciences, Inc. v. Cadus Pharmaceutical Corp., 225 F.3d 1349 (Fed. Cir. 2000) .....................................................................52
Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530 (Fed. Cir. 1983) .............................................................. 51, 52
Syntex (U.S.A.) LLC v. Apotex, Inc., 407 F.3d 1371 (Fed. Cir. 2005) .....................................................................15
Tessera, Inc. v. International Trade Com'n, 646 F.3d 1357 (Fed. Cir. 2011) .....................................................................16
United States v. Price, 458 F.3d 202 (3d Cir. 2006) ..........................................................................16
Statutes
35 U.S.C. § 103................................................................................................... 4, 19
35 U.S.C. § 271(b) ...................................................................................................59
Other Authorities
9 James W. Moore et al., Moore’s Federal Practice (3d ed. 2012) ........................................................20
Rules
Fed. R. Civ. P. 52(a)(6)............................................................................................15
Fed. R. Evid. 201(b).................................................................................................30
viii
Fed. R. Evid. 201(e) .................................................................................................30
Fed. R. Evid. 801(a)-(c) ...........................................................................................24
1
STATEMENT OF RELATED CASES
No other appeal in or from this civil action in the district court was
previously before this or any other appellate court, and no other case is known to
be pending in this or any other court that will directly affect or be directly affected
by this Court’s decision in the pending appeal.
2
COUNTER-STATEMENT OF THE ISSUES
1. Have plaintiffs-appellants shown that the district court clearly erred in its
fact findings on the first three Graham factors, including its findings on the
subsidiary fact issues that:
(a) trospium’s known physical, chemical, and pharmaceutic characteristics
made it a good candidate for a once-a-day formulation;
(b) market pressure to convert trospium to a once-a-day formulation began
shortly before the date of invention, driven by the recent reformulation of
other OAB drugs to once-daily formulations; and
(c) a person of ordinary skill in the art would have been motivated to make
the claimed invention with a reasonable expectation of success?
2. Have plaintiffs-appellants shown that the district court clearly erred in its
fact finding on objective indicia of nonobviousness, when they, inter alia:
(a) sought to prove “tried and failed” through hearsay testimony that (i)
lacked the details required to link this factor to nonobviousness even if
accepted and (ii) related primarily to events that predated the beginning of
the market pressures to switch OAB drugs to once-daily formulations; and
(b) tried to prove “skepticism of others” through hearsay testimony about
supposed events that predated the publication of significant prior art?
3
3. Did the district court, having discounted or rejected the presence of objective
indicia of nonobviousness without clearly erroneous fact finding, commit legal
error in holding the asserted claims invalid as obvious given its largely uncontested
(and not clearly erroneous) factual findings on the first three Graham factors?
4. As to the asserted method claims, did the district court err in holding that
defendant-appellee Watson infringed:
(a) claim 1 of the ’359 patent, which required a steady-state Cmax of less
than 2,400 pg/mL, by relying on data for the branded product Sanctura XR
published in 2010, even though Allergan’s expert testified that his steady-
state modeling—which the district court accepted to prove infringement of
the other claims—showed that Watson’s product had a steady-state Cmax of
3,560 pg/mL; and
(b) claim 1 of the ’359 patent, and claims 1, 10, and 18 of the ’449 patent,
without evidence that Watson had knowledge of, or intended to cause,
patients to practice claim elements that were shown to occur from use of the
branded product but not from use of Watson’s accused product?
4
COUNTER-STATEMENT OF THE CASE
The district court correctly found that defendants established by clear and
convincing evidence that all asserted claims were invalid as obvious. The district
court made detailed findings on each of the factual inquiries, including (i) the
scope and content of the prior art, (ii) the level of ordinary skill in the art, (iii) the
differences between the claimed subject matter and the prior art, and (iv) objective
indicia of nonobviousness. Graham v. John Deere Co., 383 U.S. 1, 17-18 (1966).
The district court found that the prior art taught that trospium could be used
in a once-a-day formulation and that an “extensive tool kit” was available to
accomplish this goal. A24-26; A11470:14-1471:2. It further found that the prior
art disclosed (1) multiparticulate formulations using extended, delayed, and
immediate-release pellets; (2) multiparticulate formulations designed to target the
lower GI tract; (3) properties of trospium that made it a good candidate for once-a-
day formulation; and (4) market pressure for formulate once-daily formulations.
A18-38. The district court carefully considered evidence of secondary
considerations, but found them weak or nonexistent as a matter of fact. A38-49.
Allergan’s nonobviousness argument rests largely on unproven facts of what
a company—Madaus—thought about the prospects of developing once-daily
trospium, and the results of an eight-person study published in a one-page poster.
5
No one from Madaus testified, and nothing substantiates the inadmissible hearsay
testimony of Allergan’s witness Dr. Sandage about what Madaus was thinking.
Allergan’s reliance on papers from 2008 and 2010 as evidence of the
“prevailing wisdom” that drugs with relative colonic absorption below 30% are not
recommended for extended-release (ER) formulation is improper, because articles
from 2008 and 2010 do not show what a person of ordinary skill in the art (POSA)
thought in 2002. Indeed, Allergan’s expert testified that the 30% “rule of thumb”
was developed years after the alleged invention. A11383:3-9; A11455:16-23.
Even though weak, the district court considered these references with all the other
art, and found as a matter of fact that trospium’s low colonic absorption was not
inconsistent with a reasonable expectation of success. A36.
There was no clear error in the district court’s factual findings. It made the
inquiry required by precedent and properly considered all the evidence before
concluding that defendants proved by clear and convincing evidence that the
asserted claims were invalid as obvious.
COUNTER-STATEMENT OF FACTS
I. Trospium Was An Old Drug With Known Properties That Made It An Appealing Candidate For A Once-A-Day Product
Trospium is an old drug that was first sold by Madaus in Europe as an
immediate-release (IR) twice-daily tablet starting in 1967. A16; A97-122 at A110;
6
A10139:7-12. Trospium suppositories were also available in Europe. A97-122 at
A110. Madaus has no U.S. presence or products.
In 1999, the business-development group at Interneuron—a U.S. drug
company that in-licensed products with clinical experience overseas that permits
fewer studies for FDA approval—identified trospium as a “real interesting
compound” based on its approval in Europe and clinical-study information that
Madaus had accumulated over the years. A10136:13-23; A10138:22-139:12.
Trospium was long off-patent, but Interneuron’s business means that it
needed access to Madaus’s clinical studies and dossier. To get these, Interneuron
in-licensed from Madaus know-how and clinical data for the U.S. market.
A10139:21-140:14. In December 2000, Interneuron filed an IND for IR, twice-
daily trospium. A10146:10-21. While awaiting FDA approval, Interneuron began
considering ER trospium (A10148:2-11) because the two dominant OAB drugs in
the U.S. that were previously available only in IR form—oxbutynin (marketed by
Johnson & Johnson as Ditropan) and tolterodine (marketed by Pfizer as Detrol)—
had just switched to ER, once-a-day formulations. A32-3; A10226:6-15;
A10229:2-11; A10272:9-274:4. This motivated doing the same for trospium
because—as Interneuron’s business people easily saw—“the whole market [was]
moving to a once-a-day dosage form” and a once-a-day product was needed to
compete. Id.; see also A45; A8518-19; A10321:2-7.
7
In September 2001, Interneuron published a non-confidential profile for
prospective marketing partners stating that trospium could “be easily converted to
a once-a-day treatment.” A9201-03 at A9203. Interneuron’s head of research and
development, Dr. Bobby Sandage, testified that Interneuron was “very optimistic”
it could make a once-a-day product based on (i) the clinical data it had obtained
from Madaus, and (ii) trospium’s favorable pharmaceutic properties, including its
half-life and known pharmacokinetics. A37; A10149:10-151:5; A10256:20-257:3.
II. Shire Used Its Existing Multiparticulate Platform—Already Implemented In Two Marketed Extended-Release Products And Well-Described in the Patent Literature—To Formulate Once-Daily Trospium and Quickly Achieved Success
Interneuron engaged Shire to make its once-daily trospium formulation in
February 2002, and within a couple months the claimed invention was complete.
A38; A10155:5-14; A5695-5702 at A5695; see also A10351:1-374:11. Over the
next six months, Shire performed experiments required for FDA approval.
A10351:1-374:11. However, it cannot deny that the invention was complete in
early 2002 because it relied on documents from that time (albeit with the dates
redacted) to swear behind a reference during prosecution. A925-35.
In recounting the work at Shire, inventor Dr. Raoufinia agreed that the “a-ha
moment” during development—recognizing that trospium’s limited absorption in
the colon could be handled by simply releasing more drug in the colon—came
8
from people at Interneuron who are not inventors on the patents. A10492:16-
493:19.
III. The Applicants Obtained Allowance of the Patents By Representing That Trospium Was Known To Have Negligible Absorption In The Colon, Arguing That Federal Circuit Law Made Extended-Release Claims Nonobvious If the Drug Was Not Thought To Be Absorbed in the Colon
The applications that led to the patents-in-suit were filed in November 2003.
A97-122 at A98. The Examiner rejected all claims as obvious. A676-706.
Before responding, the applicants interviewed the Examiner and presented a
one-page poster by Schröder describing a study in which eight male volunteers
were given 5 ml (1 teaspoon) trospium solution by rectum. A745-747. They
argued that Schröder reported a “very low concentration of trospium chloride
found after rectal administration,” and thus established a “lack of colonic
absorption of trospium chloride (and, hence, a corresponding lack of reasonable
expectation of success)” in formulating once-a-day trospium. A777-778. The
interview summary describes argument by attorney Villacorta and inventor Bhatt:
Dr. Villacorta detailed that Maudas AG has been marketing trospium for nearly 40 years, however, they disclose that “modified release preparations of the [trospium] using conventional technology are not expected to improve trospium chloride bioavailability.” The prior art also discloses that absorption of trospium chloride within the colon is negligible through studies of administration into the rectum. Dr. Villacorta also referenced a US Court of Appeals, Federal Circuit decision where it states hypothetically that if absorption in the colon is
9
not already achieved by the prior art composition, an extended release formulation of that composition would be non-obvious. Drs. Bhatt and Villacorta then discussed the novelty of the instant application, wherein the controlled release formulations show greater absorption in the colon when compared to the prior art. A747.
The applicants’ argument that once-a-day trospium “show[ed] greater
absorption in the colon when compared to the prior art,” was a straw man.
Allergan never showed that the claimed invention resulted in “greater absorption”
in the colon. Nor do the claims even require absorption in the colon, speaking as
they do to “release” (not absorption). Nor, for that matter, do most of the claims
even require release in the colon, speaking as they do to release in the “lower GI
tract,” which is defined by the specification as the colon and the ileum (A97-122 at
A111), which is the lower third of the small intestine.1
The applicants also argued for allowance based on dicta in a case on a
different extended-release OAB drug (oxybutynin). The patentee in Alza Corp. v.
Mylan Labs., Inc., 464 F.3d 1286 (Fed. Cir. 2006), argued that a POSA would not
expect oxybutynin to be absorbed in the colon, and would thus be dissuaded from
making a once-a-day formulation. In affirming the district court’s obviousness
judgment, the Court hypothesized that if a drug is “simply not absorbed” in the
colon, a POSA may have little motivation to release drug there. Id. at 1291-92.
1 The district court, with all parties’ agreement, construed “lower GI tract” accordingly. A64; A13913-915.
10
But that was not the evidence, and the judgment of invalidity was affirmed. Id. at
1297.
The applicants here used the hypothetical in Alza to create a fictitious
standard by which claims directed to sustained-release (SR) formulations must be
analyzed:
The CAFC in Alza has laid out for future litigations, the USPTO, and the Applicants a standard by which the obviousness/non-obviousness of patent claims of the sort scrutinized in Alza and at issue here may be determine appropriately: that is, whether one of ordinary skill in the art at the time the invention was made would have had a reasonable expectation that trospium chloride would be colonically absorbed and therefore would have been motivated to produce the claimed controlled release or once a day dosage formulation. A777.
They applied this supposed standard to the alleged results of Schröder to argue
teaching away, even though the Examiner had not cited Schröder in his rejection:
The instant application claims the benefit of a November 4, 2003 priority date. Hence, the proper inquiry is what one of ordinary skill in the art would have known in 2003 about the level of colonic absorption of trospium chloride. To answer this question, Applicants presented at the personal interview, as evidence of the prevailing sentiment in the art of a lack of colonic absorption of trospium chloride (and hence corresponding lack of reasonable expectation of success), a poster presentation … by researchers from Germany. Id.
* * *
[T]he poster presentation teaches away from the subject matter of the various pending claims, as the poster presentation teaches that colonic absorption is almost negligible and effectively rules out any hope of improving trospium chloride bioavailability using modified release preparations. A785.
11
In allowing the claims, the Examiner accepted the applicants’ arguments
about Schröder:
However the instant invention has disclosed that trospium chloride-bearing particulates comprising at least one enteric and/or release controlling polymers sufficiently release trospium chloride into the lower GI, tract wherein the trospium chloride is sufficiently absorbed and steady state blood level that are comparable to twice daily administration of 20 mg immediate release trospium chloride tablets is achieved. Therefore, Schroder et al. teach away from the instant invention but the instant invention has shown unexpected results of sufficient absorption of trospium chloride into the lower GI tract when formulated in particulates comprising at least one enteric and/or release controlling polymers. A1172.
The asserted claims do not require absorption in the colon, are not directed to
specific formulations, and do not provide improved bioavailability. They require
only release in the lower GI tract (and in two claims, release in the colon).
Inventor Dr. Kidane acknowledged, “what is in the claims is any combination that
would produce delivery to the lower part of the GI tract.” A10407:25-408:20.
SUMMARY OF THE ARGUMENT
The district court found that defendants carried their burden of proving
obviousness by clear and convincing evidence, and its findings of fact are not
clearly erroneous.
There is no real dispute that all elements of the claims are in the prior art,
that conventional sustained-release technology widely used in commercial
products was fully applicable to trospium, and that substantial market pressure
12
demanded a once-daily formulation. Even if there was a dispute, the district
court’s findings all these points are not clearly erroneous.
On the first three Graham factors, the substantial point of disagreement at
trial was whether a POSA would—despite this knowledge and motivation—throw
up his hands in belief that the entire venture would be futile. Reprising the
argument that carried the day during prosecution, Allergan argued at trial (and now
on appeal) that the Schröder poster—a non-peer reviewed, single-page abstract
reporting an eight-subject experiment with rectal administration of one teaspoon of
trospium solution—so convincingly disproves that trospium is absorbed in the
colon that a POSA would disregard everything else that made trospium an
attractive candidate for once-daily formulation. But the district court found based
on substantial evidence, including the testimony of Allergan’s own expert, that the
Schröder poster did not disprove the absorption of trospium in the colon and would
not have negated a POSA’s expectation of success.
Allergan’s other argument is that the district court gave inadequate weight to
objective indicia of nonobviousness, but this too fails because the district court
found against Allergan on the facts. Here, Allergan sought to prove failure-of-
others and skepticism through hearsay testimony that the district court found
unpersuasive. The district court’s evaluations of the evidence are findings of fact,
and not clearly erroneous.
13
Even if credited, Allergan’s hearsay evidence of failure-of-others lacks the
details necessary to link it to obviousness. In summary, its witness Dr. Sandage
testified that Madaus, which marketed immediate-release trospium in Europe, did
not develop a once-daily product. But he did not testify to, and did not know, what
Madaus attempted, its commercial analysis, the business case for such products in
Europe, what resources were available, or any of the myriad factors that may lead a
pharmaceutical company not to invest in a candidate. It is an unreasonable
inference, and certainly not an inference that the district court was obligated to
accept, to equate every instance of nondevelopment with failure a of development
for reasons that bear on obviousness, such as lack of necessary information in the
prior art or significant technological hurdles.
On the facts properly found by the district court, the asserted claims are
indeed obvious. The findings on the first three Graham factors were powerful, the
evidence of secondary considerations was weak to nonexistent, and all that remains
is the use of routine techniques to make a product that performs as would have
been expected.
Separately, Watson includes alternative grounds for affirmance as to the
asserted method claims. Allergan did not prove inducement because it relied on
information outside the label, and not associated in any way with Watson, to prove
direct infringement without showing that Watson knew of this information or
14
intended its accused product to perform in the patented way. As to one of the
claims, Allergan also failed to prove direct infringement because its expert
admitted that Watson’s accused product did not satisfy all elements of the claim.
15
ARGUMENT
I. Standard of Review
Obviousness is a question of law based on underlying facts. Graham, 383
U.S. at 17. The ultimate determination of obviousness is reviewed de novo, the
Graham factors for clear error. Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809,
810-11 (1986); Syntex (U.S.A.) LLC v. Apotex, Inc., 407 F.3d 1371, 1378 (Fed.
Cir. 2005). Similarly, the presence or absence of (i) motivation to combine
references and (ii) reasonable expectation of success are questions of “pure fact.”
Alza v. Mylan, 464 F.3d at 1289.
The district court’s fact findings can be set aside only if clearly erroneous.
Fed. R. Civ. P. 52(a)(6). Under this standard in the Third Circuit:
It is the responsibility of an appellate court to accept the ultimate factual determination of the fact-finder unless that determination either (1) is completely devoid of minimum evidentiary support displaying some hue of credibility, or (2) bears no rational relationship to the supportive evidentiary data.
Giles v. Kearney, 571 F.3d 318, 322 (3d Cir. 2009). “If the district court’s account
of the evidence is plausible in light of the record viewed in its entirety, the court of
appeals may not reverse … [even if] it would have weighed the evidence
differently.” Anderson v. Bessemer City, 470 U.S. 564, 573-4 (1985).
16
Infringement is a question of fact that requires comparing the accused
product to the properly construed claims. Tessera, Inc. v. International Trade
Com'n, 646 F.3d 1357, 1364 (Fed. Cir. 2011).
Whether a statement is hearsay is a question of law reviewed de novo.
United States v. Price, 458 F.3d 202, 205 (3d Cir. 2006).
II. The District Court Did Not Commit Legal Error
A. The District Court Did Not Fall Into Hindsight
Allergan’s attack on the district court as employing hindsight is misplaced.
Hindsight is using the claims as a roadmap through the prior art, not conducting an
element-by-element analysis. Ruiz v. A.B. Chance Co., 357 F.3d 1270, 1275 (Fed.
Cir. 2004) (assessing prior art with respect to claim elements to determine if claims
as a whole are obvious is not impermissible hindsight); Princeton Biochemicals,
Inc. v. Beckman Coulter, Inc., 411 F.3d 1332, 1336-39 (Fed. Cir. 2005) (affirming
judgment of obviousness that followed element-by-element analysis of prior art
because there was sufficient evidence of motivation to combine).
Allergan even demanded the element-by-element analysis it now complains
of. At trial, it criticized Dr. Kibbe’s opinion of obviousness—which he expressed
after explaining the scope and content of the prior art, and the reasons a POSA
would be motivated to make certain modifications and changes—because there
was no “limitation by limitation, element by element tying of the claims to the
17
prior art.” A11365:1-3. Having complained before that defendants should have
more overtly matched each claim element to the prior art, Allergan’s new
complaint that the district court erred by doing so (Br. at 2, 4) comes with ill-grace,
especially after it told the district court that finding obviousness without doing this
would not “last 10 minutes up at the Federal Circuit.” A11365:8-9.
B. Allergan Invited the District Court to Determine if It Rebutted Prima Facie Obviousness With Evidence of Secondary Considerations
Allergan’s criticism of the district court’s order of analysis—in which it
considered the Graham factors and stated that the claims were prima facie obvious
before moving to secondary considerations—fails because Allergan invited this
approach. The district court acknowledged Allergan’s request, as shown by
comparing Allergan’s post-trial brief with the Opinion:
Allergan’s brief Opinion
105. Plaintiffs are not required to demonstrate any secondary considerations of non-obviousness unless and until defendants establish a prima facie case of obviousness. Alza Corp. v. Mylan Labs., Inc., 391 F.3d 1365, 1373 n. 9 (Fed. Cir. 2004.) The Court finds that defendants did not establish such a case. In any event, had defendants done so, plaintiffs presented evidence of secondary considerations sufficient to rebut any prima facie case, as described below. A15308-15355 at A15349, ¶ 105.
Here, the plaintiffs contend that the defendants failed to establish a prima facie case of obviousness in light of the evidence adduced at trial. The plaintiffs also argue, in the alternative, that should the court determine, as it has, that the defendants established a prima facie case on this issue, the secondary considerations of copying, teaching away, failure of others, licensing, and unexpected results/skepticism sufficiently rebut this prima facie case. A39.
18
Having presented the law this way, Allergan cannot assign error to the district
court’s approach. Cordis Corp. v. Medtronic Ave, Inc., 511 F.3d 1157, 1172 (Fed.
Cir. 2008) (appellant’s challenge to jury instruction it proposed “either constitutes
‘invited error’ that is not reviewable at all, or at most is subject to review under the
‘plain error’ standard”) (Third Circuit law).2
Even if Allergan’s attack is not formally barred as invited error, the
substantial congruence between its statement of law and the district court’s
approach demonstrates that any error was harmless. The Federal Circuit routinely
employs the same shorthand. For example, Leapfrog Enterprises, Inc., v. Fisher-
Price, Inc., 485 F.3d 1157 (Fed. Cir. 2007), came up from the same district judge,
who found the claims obvious and discussed secondary considerations only after
several pages devoted to the prior art:
As to the secondary considerations tending to show nonobviousness, Leapfrog points to only three: commercial success, praise, and long-felt need. While it is true that Leapfrog adduced substantial evidence of these three factors, the court is not convinced that they overcome the very strong case of obviousness presented by Fisher-Price through the testimony of [its expert].
Leapfrog Enters., Inc. v. Fisher-Price, Inc., No. 03-927-GMS, 2006 WL 891001,
*4 (D. Del. Mar. 30, 2006). The Federal Circuit affirmed, rejecting the patentee’s
2 Invited error applies in bench trials. Glassroth v. Moore, 335 F.3d 1282, 1290 (11th Cir. 2003); O2 Micro Int’l Ltd. v. Beyond Innovation Tech. Co., 449 Fed. Appx. 923, 934 (Fed. Cir. 2011) (non-precedential).
19
argument that the district court gave inadequate consideration to secondary
considerations, and using the familiar “prima facie” formulation:
Finally, we do not agree with Leapfrog that the court failed to give proper consideration to secondary considerations. The district court explicitly stated in its opinion that Leapfrog had provided substantial evidence of commercial success, praise, and long-felt need, but that, given the strength of the prima facie obviousness showing, the evidence on secondary considerations was inadequate to overcome a final conclusion that claim 25 would have been obvious. We have no basis to disagree with the district court’s conclusion.
Leapfrog, 485 F.3d at 1162. Indeed, Graham also invites this analysis:
Under § 103, the scope and content of the prior art are to be determined; differences between the prior art and the claims at issue are to be ascertained; and the level of ordinary skill in the pertinent art resolved. Against this background, the obviousness or nonobviousness of the subject matter is determined. Such secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc., might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented. As indicia of obviousness or nonobviousness, these inquiries may have relevancy.
383 U.S. at 17-18. See also KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 426
(2007) (“Like the District Court, finally, we conclude Teleflex has shown no
secondary factors to dislodge the determination that claim 4 is obvious.”).
Unlike the district court’s characterization of the legal role of secondary
considerations in an obviousness analysis—which was legally correct and endorsed
by Allergan—its citation to an ex parte case for the proposition that “once a prima
facie case of obviousness has been established, the burden then shifts to the
applicant to present evidence of secondary considerations” (A38) was misplaced,
20
even though legally correct (because of the reference to “the applicant”). Allergan
does not show, however, that this affected the outcome.
First, the district court’s more detailed statement of the standards for
obviousness (A14-15) was correct. It identified the Graham factors, including
secondary considerations, as framing the factual inquiry and correctly stated that a
party challenging validity bears the burden of proof by clear and convincing
evidence. A14 n.2. Nothing in the Opinion suggests it disregarded these
principles.
Second, because the ultimate legal issue of obviousness is reviewed de novo,
the Federal Circuit would not simply adopt the district court’s legal conclusions in
any event, rendering harmless any misstatement of the law that did not infect the
district court’s factual findings. 9 James W. Moore et al., Moore’s Federal Practice
§ 52.32[4] at 83-84 (3d ed. 2012) (reviewing court may discard fact findings based
on erroneous view of law only if the legal error affected the challenged findings);
Lincoln v. Board of Regents, 697 F.2d 928, 939-40 n.13 (11th Cir. 1983) (“We
need not depart from the ‘clearly erroneous’ standard, however, if application of
the wrong legal standard did not ‘taint or infect’ the district court’s factual
findings.”). No “infection” occurred here: the district court did not assign to
21
Allergan the burden of proving validity, or relieve defendants of their clear-and-
convincing evidentiary burden.3
C. The Result in Cyclobenzaprine Does Not Mandate Reversal
Allergan’s efforts to shoe-horn this appeal into In re Cyclobenzaprine, 676
F.3d 1063 (Fed. Cir. 2012) fails because Allergan erroneously equates its unproven
and properly rejected “failure of others” to the well-documented failure of Alza to
make a once-a-day formulation of cyclobenzaprine.
First, the evidence in Cyclobenzaprine of Alza’s attempt and failure directly
refuted the challengers’ obviousness case by showing that targeting the known-
effective pharmacokinetics of the immediate-release drug—which was at the heart
of the defendants’ obviousness case—did not work. Specifically:
ALZA chose a straight line that cut through the immediate-release profile, staying below the peaks and above the valleys. ALZA hoped that staying below the peaks would avoid side effects and that staying above the valleys would maintain therapeutic effectiveness. Clinical trials, however, revealed that ALZA’s product was not therapeutically effective. ALZA lost $10 million in its unsuccessful attempt to develop an extended-release formulation.
3 If legal error did render the factual findings infirm, the remedy is remand for new findings under the correct standard. Pullman-Standard v. Swint, 456 U.S. 273, 293 (1982) (“It follows that when a district court’s finding on … [a] fact is set aside for an error of law, the court of appeals is not relieved of the usual requirement of remanding for further proceedings to the tribunal charged with the task of fact finding in the first instance.”).
22
Id. at 1081. The Court explained that Alza’s efforts established what “failure of
others” is all about, i.e., showing “the presence of a significant defect in the prior
art, while serving as a simulated laboratory test of the obviousness of the solution
to a skilled artisan.” Id. at 1082 (citation omitted). Because Alza’s failure showed
that “a therapeutically effective PK profile was lacking in the prior art and that
skilled artisans struggled to attain it,” it was “keyed to the problem that the patents
in suit purport to solve.” Id.
The same cannot be said for the alleged “failure” of Madaus, even if the
Court were to reject the district court’s findings of fact as clearly erroneous (which
they are not) and substitute Allergan’s arguments. Here, there is no evidence that
Madaus made any effort to produce a once-daily trospium formulation, much less
evidence that it tried and failed. Without evidence connecting “tried and failed” in
a logical manner to the asserted claims, prior art, motivation, and everything else
bearing on the ultimate legal question of obviousness—as in Cyclobenzaprine—
“tried and failed” is an empty recitation of patent-law jargon.
Allergan’s evidence is no better than the patentee’s evidence in
Cyclobenzaprine of alleged failures by Merck and Schering-Plough, who were
actually working on development of extended-release cyclobenzaprine and
experimenting with formulations. As to them, the Federal Circuit held that the
23
evidence was weak and the district court did not clearly err in disregarding it. Id.
at 1081, n.9.
Second, Alza’s attempt and failure in Cyclobenzaprine was proven by an
Alza scientist who testified to the difference between (i) Alza’s failed attempt
using the conventional approach (cutting through the pharmacokinetic peaks and
valleys of the IR product) and (ii) the “materially different approach” taken by the
patentee, whose success surprised him. Id. at 1081-82.
The same cannot be said for the alleged “failure” of Madaus. Despite
repeated statements in its appeal brief (never supported by record cites) to the
effect that Madaus spent “years” trying to develop a new formulation (see, e.g., Br.
at 14, 59), Allergan presented no evidence from anyone connected to Madaus of
what Madaus did. Its only evidence was the hearsay testimony of Dr. Sandage—
admitted over defendants’ objections—of what people associated with Madaus
allegedly told him. Further, the absence of details about what Madaus supposedly
attempted deprives its alleged failure of probative value. Again, Allergan has only
ritualistic box-checking, not meaningful evidence that logically bears on
obviousness. At minimum, the district court’s decision not to credit this evidence
is a factual determination and not clearly erroneous.4
4 The common receipt of hearsay by district courts in bench trials “for what it’s worth” carries with it a need for circuit courts to afford great deference to findings (continued…)
24
III. The District Court’s Factual Findings Are Not Clearly Erroneous
A. The Testimony By Indevus Employee Dr. Sandage of Alleged Failures and Skepticism By Madaus AG And Bayer Pharmaceuticals Was Hearsay Not Subject To Any Exception
Allergan’s evidence of “tried and failed” and “skepticism of others” is the
testimony of Dr. Sandage, who testified to what people at Madaus and Bayer
supposedly told him. This is hearsay not within any exception. Inventive Music
Ltd. v. Cohen, 67 F.2d 29, 32 (3d Cir. 1984)5
First, the alleged assertions (“statements”) by persons at Madaus and Bayer
(“declarants”) were made out of court, and the declarants were not present at trial.
Fed. R. Evid. 801(a)-(c).
that do not credit (or severely discount) such testimony. As between the party that offers hearsay and the party that objects, such deference puts the risk where it belongs, i.e., on the party that risks trying to prove facts through hearsay. The rule against hearsay would become meaningless if the district courts were permitted to receive hearsay “for what it’s worth” in bench trials—as a matter of convenience to keep things moving—only to have their findings of fact overturned because they did not credit that hearsay testimony. Cf. Pan Am. World Air., Inc. v. Aetna Cas. & Sur. Co., 505 F.2d 989, 996, 1005 (2d Cir. 1974) (noting that district court received hearsay evidence of “dubious probative value” under “the relaxed rules of evidence applicable in bench-tried cases,” holding that it did not commit clear error in giving it little weight, and rejecting proponents’ argument that “clearly erroneous” standard should not apply because hearsay nature of the evidence meant that the district court had not evaluated the credibility of the out-of-court declarants). 5 Defendants preserved this point by objecting. A014546; A14525-14533 at A14528; A10181:8-10183:9.
25
Second, the statements were offered to prove the truth of the matter asserted,
i.e., that Madaus and/or Bayer had not been able to make once-daily trospium
and/or did not believe it feasible. Id. 801(c).
Third, no hearsay exception applies. In response to defendants’ objections,
Allergan argued that statements made by Dr. Fuhr and unnamed persons at Bayer
to Indevus were probative of Indevus’ state of mind, which in turn was relevant to
Indevus’ intent to mislead the PTO. A10180:3-12; A10183:10-16. This only
supports admissibility for a particular purpose (the effect of the declarant’s out-of-
court statement on the testifying witness’s state of mind), not a hearsay exception
under Rules 803 or 804.6
Allergan’s argument at trial that the out-of-court statements were not
admitted for the truth of the matter asserted is contrary to its use of them now.
Assuming arguendo that the out-of-court declarant told Sandage, e.g., that he (or
his company) tried and failed, the statement is probative of “tried and failed” only
if that was true.
6 Defendants’ had pled inequitable conduct and the issue was in play at trial, but after Therasense came down after trial advised Allergan and the Court they were no longer asserting it.
26
B. Allergan’s Attempts to Substitute Madaus and Dr. Fuhr for the Hypothetical Person of Ordinary Skill in the Art Are Improper as a Matter of Law
Because obviousness is based on the hypothetical POSA aware of all the
pertinent art, evidence that a specific individual did not combine the prior art is
largely irrelevant. Indeed, it is “erroneous as a matter of law” to find
nonobviousness based on testimony of an expert that he himself had never thought
of combining the prior art to arrive at the claimed invention. Amazon.com, Inc. v.
Barnesandnoble.com, Inc., 239 F.3d 1343, 1364 (Fed. Cir. 2001); see also
Rothman v. Target Corp., 556 F.3d 1310, 1318 (Fed. Cir. 2009) (expert’s statement
that the invention was “not imaginable” to him “has little relevance to whether …
[the] invention would have been obvious to a hypothetical person of ordinary skill
in the field with attributed knowledge of the relevant prior art”).
C. The Scope and Content of the Prior Art
1. The District Court Correctly Found That Art Suggested Use of Multiparticulate Formulations
Substantial evidence supports the district court’s finding that a POSA would
have known about, and been motivated to use, a multiparticulate system for
extended-release trospium. A18-25; A11558-11585; A9890-9916; A9044-9050;
A9558-9562; A9068-9083; A9795-9823; A9051-9067; A9084-9101; A9102-9114.
The district court credited Dr. Kibbe’s uncontradicted testimony that
multiparticulates were desirable because pellets with different release
27
characteristics can be combined in a single capsule and disperse widely along the
GI tract, promoting absorption. A18; A10870:4-872:2. It also credited Dr. Davis’s
testimony that the POSA would know that once-a-day formulations should deliver
drug throughout the GI tract, and would be able develop formulations to release
drug in the lower GI tract (ileum and colon). A19; A11472:7-11; A11475:12-
1476:14.
Allergan’s assertion that the district court used hindsight in its discussion of
Carbatrol as prior art mischaracterizes the Opinion and knocks down a straw man.
Defendants never argued that Carbatrol was a direction to use trospium, but rather
that this successful extended-release product and associated literature was
instructive in the use of multiparticulate formulations. The district court properly
found that Carbatrol, though a different drug, teaches “that multiparticulate
formulations can be employed to target release in the lower GI tract by adjusting
the polymer blend used to control release.” A21. Dr. Davis largely agreed.
A11472:7-11; A11475:12-1476:14; A11520:8-14.
Allergan’s argument that “there was no dispute at trial that quaternary
ammonium compounds like trospium present absorption problems in the colon that
tertiary amines do not” (Br. at 42) misreads the cited testimony, which addressed
trospium’s generally low absorption throughout the GI tract but does not address
the ease or difficulty formulating tertiary amines. A11012; A11208-09; A1393. In
28
contrast, Dr. Mayersohn testified that oxybutynin, a tertiary amine OAB drug with
even lower bioavailability than trospium, was successfully reformulated into a
once-daily product (Ditropan XL). A11212:1-3. Allergan’s criticism that some
individual references do not recite trospium misses the point, which is that
substantial art disclosed the desirability of multiparticulate systems to make ER
formulations of many different drugs. Allergan’s anticipation-type argument,
holding up each reference and making a statement about what element it does not
disclose, does not negate obviousness.
2. The District Court Correctly Found That Trospium Would Have Been Considered for Modified-Release Formulation
The district court found, and substantial evidence supports, that a POSA
would consider trospium for once-daily ER formulation. A25-32. It further found
that such a person would have looked to all the known characteristics of trospium,
good and bad. A25; A11026:21-1027:22; A11073:13-24; A11074:3-13;
A11400:4-24. Allergan’s argument that one characteristic controls, the alleged
poor colonic absorption, is contrary to its own expert’s testimony (A11400:9-24)
and was properly rejected.
(a) Allergan’s New Argument Concerning IV/IVC Lacks Factual Support
Allergan's argument on appeal that lack of a known in vitro/in vivo
correlation (IV/IVC) “suggested to everyone but the inventors that it was a poor
29
candidate for once-a-day formulation” (Br. at 42, 45-46) is unsupported by the
record. The entirety of the testimony on this point was Dr. Davis’ passing
comment that lack of known IV/IVC “would be a concern.” A11405:1-16.
Allergan’s only mention of IV/IVC in its post-trial brief is one sentence that
includes “lack of IV/IVC” in a list of properties it says “made for a low expectation
of success.” A15308-15355 at A15340, ¶ 85.
Even so, the district court considered the lack of a known IV/IVC. A17,
A25-32. Allergan’s criticism that the district court “relegated the lack of IV/iVC
[sic] to a footnote” is poorly taken because the Opinion recites the entirety of
Allergan’s post-trial argument on IV/IVC. Compare A17 n.7 with A115340, ¶ 85.
Allergan’s attempt to find support in Cyclobenzaprine and Abbott Labs. v.
Sandoz, Inc., 544 F. 3d 1341 (Fed. Cir. 2008), are unavailing. Appellate decisions
do not establish facts that relieve litigants in other cases who need to prove (or
disprove) what a POSA would believe, disbelieve, or find important from putting
on evidence. Indeed, the factual findings in Cyclobenzaprine would not even
apply in a new case on the same patents if an unrelated company (not precluded by
collateral estoppel) tried to prove them invalid as obvious. The Federal Circuit’s
conclusion that District Judge Robinson, sitting as the trier of fact in
Cyclobenzaprine, made some findings that were clearly erroneous on that record,
and that the facts as properly found on that record did not establish obviousness of
30
those claims by clear and convincing evidence, does not establish facts that apply
to other cases on other sustained-release patents.7
Cyclobenzaprine emphasized that no doctrine makes patents to sustained-
release formulations automatically obvious over the immediate-release prior art.
676 F.3d at 1084. But neither does any doctrine make such patents automatically
nonobvious over the immediate-release prior art unless certain subsidiary facts
(like PK/PD relationships) are proven. There are no short cuts in judging
obviousness; importing the facts of one case to an unrelated case would deprive the
parties of their right to a trial in which a court or jury renders a decision or verdict
based on—and based only on—the properly admitted evidence in the case before
it. It is not too much to ask of a litigant that wants to rely on some aspect of
pharmacology and drug development in opposition to (or in support of) an
obviousness challenge to disclose it in response to interrogatories, include it in
expert reports, and present it at trial through a qualified witness subject to cross-
examination. The only factual shortcut permitted by the Rules of Evidence is a
7 The district court’s error in Cyclobenzaprine was not taking into account the substantial evidence that a lack of a known PK/PD correlation belied the challengers’ theory that it would be routine to use the PK profile of immediate-release cyclobenzaprine to make the sustained-release drug. As shown in that case by Alza’s failure to succeed using this approach and the patentee’s success by going well outside the PK profile of the IR formulation, the claimed invention was not the product of routine experimentation. Allergan does not show (and did not prove at trial) that this has anything to do with IV/IVC.
31
request for judicial notice, but that must be done in a way that lets the other side
challenge it. Fed. R. Evid. 201(e). And regardless of how compelling the evidence
may have been in Cyclobenzaprine or Abbott, Allergan would not have been
entitled to judicial notice of the proposition that IV/IVC or a PK/PD relationship is
important to sustained-release formulation development because those are not a
facts “generally known” in the District of Delaware. Id. 201(b)
(b) The District Court’s Finding That a POSA Would Consider Trospium for Once-Daily Formulation Is a Factual Determination and Not Clearly Erroneous
Contrary to Allergan’s arguments, it is not true that “[t]he question of
whether the lower court balanced this evidence correctly is ultimately a legal one–
the content of the prior art is largely undisputed.” Br. at 46. The only legal
determination is the ultimate issue of obviousness. The sifting of evidence to
decide if a POSA would consider trospium viable for once-daily formulation is the
district court’s job as the trier of fact. The sifting of the evidence regarding the
“positive” and “negative” attributes of trospium, the relative weight given to each
witness’s testimony, and the finding that a POSA would have considered trospium
a viable candidate for extended-release formulation are fact issues reviewed for
clear error. Substantial evidence supports the district court’s findings that several
attributes demonstrated that trospium was a good candidate for once-a-day
32
formulation, including its absorption in the GI tract, pharmacokinetics, and half-
life. A25-32 (discussed infra 31-38).
(c) The Prior Art Demonstrated Colonic Absorption of Trospium
Substantial evidence credited by the district court shows that a POSA would
have understood that trospium, while having low absorption overall, is absorbed in
the colon. A42-43. For example, the court credited Dr. Mayersohn’s testimony
(discussing Drees, A9574-9582) that successful use of trospium suppositories for
bedwetting “suggests colonic absorption following rectal administration.” A43;
A11210:4-12; A11259:13-16.
Allergan’s claim that Madaus’ sale of trospium suppositories “did not lead it
to conclude that colonic absorption was a feasible approach for extended-release as
evidenced by its later work and skepticism” (Br. at 57) is lawyer argument, not a
fact or inference the district court was required to accept. There is no evidence that
“Madaus” (a company, not a person) considered the suppositories in making an
alleged decision (never proven) not to pursue an extended-release trospium for
reasons probative of nonobviousness. Allergan’s factually unsupported
supposition that “Madaus” made a legally probative decision not to spend money
on ER trospium is no better than a conjecture that its alleged decision (if any such
decision was actually made) was because (i) the German health-care system has
poor reimbursement for me-too drugs not shown to be clinically superior to
33
existing therapeutics, or (ii) it did not think it could get sufficiently broad patent
claims. Allergan’s failure to secure testimony from Madaus means that neither the
district court nor this Court can find the facts as Allergan argues them.
The district court found, and substantial evidence supports, that a POSA
reading Schröder’s statement about poor colonic absorption based on rectal
administration of 5 ml (1 teaspoon) of trospium solution would find it inconsistent
with “the known therapeutic effectiveness of trospium suppositories.” A42. Dr.
Kibbe explained that because the suppositories gave about the same clinical
response as intravenous trospium, “there must be drug being absorbed [from] the
suppository.” A11010:12-1011:16 (discussing Heynen (A9880-9889 at 5-6
(English translation)), on trospium suppositories in adults with fractures,
appendectomies, or GI problems). Dr. Davis complained that Heynen was not
placebo controlled (A11431:20-1432:7), but acknowledged there was a positive
control, i.e., suppositories were compared to trospium IV and showed similar
efficacy. A11478:15-1480:9. Similarly, inventor Flanner admitted that the
availability of trospium suppositories “would seem to be a contradiction” to the
notion that trospium is not absorbed in the lower GI tract. A11341:5-9.
There is substantial evidence that a POSA would find encouraging the long-
term presence on the market of trospium suppositories, and the district court so
found. A42. There is no evidence that a POSA would try to adjudicate efficacy
34
the way an FDA reviewer would if trospium suppositories were the subject of an
application for approval here. It was not clearly erroneous for the district court to
find, based on the known therapeutic effectiveness of trospium suppositories
detailed in Drees (A9574-9582) and Heynen (A9880-9889), that a POSA would
conclude that trospium is absorbed in the colon.
Allergan relies on Schröder to argue that poor colonic absorption was known
to one of ordinary skill. Br. at 43; see also id. at 15, 16, 56, 57. But the district
court reasonably credited the testimony of all the experts that Schröder would not
have taught to a POSA that there was poor colonic absorption and would not have
taught away from a once-daily extended-release formulation. A40-44. Dr. Davis
agreed that Schröder’s 5 ml mini-enema would not reach the colon (A11462:7-15),
and testified that a POSA “would have ignored the Schröder poster.” A11490:5-
1491:10. Compounding its error, Allergan points to articles that published years
after the date of invention in an attempt to show the existence of a 30% absorption
threshold, even though Dr. Davis testified regarding this threshold that “[i]t was
formulated in an article, I think for the first time, by Karen Jones some years ago,
but after the 2003 date.” A11383:3-9.8
8 On this point, Allergan’s statement that “Watson’s abandoned expert Dr. Park proposed a classification system” (Br. at 43) is factually inaccurate. The article was written by Zhang and Surian, and published in 2010 in a book edited by Dr. Park.
35
Allergan again tries to rely on caselaw to refute the district court’s fact
finding. Br. at 44. In Alza v. Mylan, the Federal Circuit affirmed the invalidity of
claims to extended-release oxybutynin despite the patentee’s argument that a
POSA “would not have believed that oxybutynin could be absorbed in the colon.”
464 F.3d. at 1292. The Court’s “Description of the Technology” provided a
hypothetical where if:
a particular drug is simply not absorbed from the colon to the bloodstream, then it may make little sense to develop an extended-release dosage form that is capable of “withholding” the release of some fraction of that drug until it reaches the colon.
Id. at 1291-92 (emphasis added). As discussed above (infra at 29-30), this does not
establish “precedential facts” that relieve a litigant seeking to prove (or disprove)
what a POSA would know, believe, or disregard from introducing evidence. In
any event, Allergan did not establish that trospium is “simply not absorbed” from
the colon. To the contrary, the district court found, supported by substantial
evidence (discussed in the preceding paragraphs) that a POSA would have known
that trospium is absorbed in the colon.9
9 Nor does Allergan explain how that hypothetical helps its many claims that do not require release in the colon, i.e., those directed to release in the ileum or colon (lower GI tract).
36
(d) The Pharmacokinetic Parameters of Trospium were Known and Would Have Been Considered By a Person of Ordinary Skill in the Art as a Positive Factor in Formulating ER Trospium
Substantial evidence supports the district court’s finding that the PK
parameters of trospium were known in the art and would have provided valuable
information to a POSA designing a once-a-day extended-release formulation.
A26. The district court credited the testimony of Drs. Kibbe, Mayersohn, and
Kidane that a POSA would have used them. A26; A11038:22-1039:21;
A11207:19-1208:2; A10296:3-9, A10302:5-13. For example, Dr. Kibbe testified
without contradiction or impeachment that a POSA would start with the “goal of
having a lower Cmax and slightly higher Cmin” than the IR formulation.
A11035:21-1036:12. He similarly explained that a POSA would be able to use and
apply the literature on immediate-release trospium to make a once-a-day product.
A31; A11035:21-1036:12; A11036:21-1037:8.
(e) The Half-Life of Trospium Was Known and Would Have Been Considered By a Person of Ordinary Skill in the Art as a Positive Factor in Formulating ER Trospium
The district court found, based on substantial evidence, that the half-life of
trospium would have been considered as a significant positive factor. A28-29. It
credited Dr. Kibbe’s testimony that trospium was known to have a relatively long
half-life and relatively long Tmax that only needed to be extended “a little bit” to
37
make a once-a-day product. A26-27; A11014:4-1016:5. It also found that Füsgen
(A9130-9141) and Zerres (A9583-9781) teach that trospium has a half-life of 5 to
17 hours, in the range considered favorable for a once-daily formulation. A27;
A9132; A11206:25-1208:9; A11215:3-7; A11281:19-1283:15; A11469:17-22. Dr.
Davis agreed with Dr. Mayersohn that drugs with a medium half-life, like
trospium, are good candidates for ER formulations because only a small increase in
the effective half-life is needed to provide a 24-hour therapeutic effect.
A11294:11-24; A11513:1-19; A11515:6-23. Additionally, Indevus told
prospective marketing partners that trospium could “easily” be converted to a
once-daily product because of its long half-life. A9201-9203 at A9203; A10256:5-
257:4.
3. A Person of Ordinary Skill in the Art Would Have Known to Increase the Amount of Trospium Released in the Colon to Increase Absorption
The district court found, and substantial evidence supports, that a POSA
would have known to increase the amount of trospium released in the colon to
overcome its binding to mucus (which reduces absorption). A29-31. It found, and
Allergan did not dispute, that Langguth (A9142-9149) disclosed that trospium’s
limited absorption resulted from binding to mucus, particularly at the neutral pH of
the colon, and suggested compensating by saturating the binding sites with excess
quaternary ammonium. A29; A9145. The court credited Dr. Kibbe’s testimony
38
that a POSA would understand that excess trospium could be employed so “the
residual trospium that was available would have an opportunity to be absorbed.”
A29; A11029:10-1030:9. The court further found that this solution was also taught
in U.S. Patent 2,899,357. A29; A11030:24-1031:3; A11101:11-1102:3; A9793-
9794 at col. 1:35-50. And Dr. Davis admitted that increasing the amount of drug
delivered to the colon was a known way to address decreased absorption there.
A11486:24-1489:2.
Shire e-mails and Dr. Kidane’s testimony confirm Dr. Kibbe’s interpretation
of Langguth’s teachings:
Recent transport study results as well as literature search revealed that the low bioavailability of Trospium is at least partially due to its binding to mucin (negatively charged for the most part). Blocking the binding of trospium to mucin by incorporating other quaternary ammonium compounds resulted in permeability enhancement. With this in mind, one avenue of enhancing ‘bioavailability’ is to increase the dose in the DR portion. This is basically to use trospium itself to saturate the binding sites (mucin) hence what comes beyond the saturation point will be absorbed.
A31; A9994; A10398:11-403:17; A11028:17-1033:4; see also A9992-9993.
Allergan’s argument that it is incorrect to use “the fact that an inventor [Kidane]
gleaned an idea from the prior art against him when the inventor’s idea is different
from what was taught” (Br. at 49) misstates the district court’s use of the evidence.
The contemporaneous non-litigation-motivated evidence of how Dr. Kidane read
39
Langguth is probative (but of course not controlling) of what that reference
discloses. In any event, any error in this regard was harmless because other
evidence amply supports the district court’s findings on Langguth.
4. The District Court Correctly Found Motivation to Formulate Trospium as Once-a-Day Extended-Release Formulation
The district court credited substantial evidence that a person of ordinary skill
in the art as of 2002 would have been motivated to formulate trospium as a once-a-
day extended-release product, including Dr. Kibbe’s testimony and the Rovner
review article (A9871-9879). A32-33.
The district court found that Rovner taught “that the OAB market was
moving towards once-a-day formulation.” A32. For instance, Rovner stated that
by 2002, two OAB drugs, Ditropan (oxybutynin) and Detrol (tolterodine), had
been reformulated to once-a-day dosage forms:
The poor tolerability and/or the need for frequent daily dosing with current antimuscarinic IR formulations has led to the search for new treatment approaches. Alternative drug delivery systems, in terms of the development of ER formulations for once-daily administration, is one such approach to improve not only dosing, but potentially also affecting tolerability and efficacy. Indeed, given the established link between prescribed dose frequency and compliance, such formulations can be expected to maximize convenience and thereby improve compliance. This is of direct relevance to patients with OAB, a chronic condition often requiring satisfactory adherence to long-term therapy. Moreover, the pharmacokinetic profile of such ER formulations should lessen the ‘peak-and-trough’ serum concentrations seen following multiple daily dosing with IR
40
formulations. A lowering of peak drug levels may be associated with a reduction in dose-related adverse effects, such as dry mouth. ER formulations of oxybutynin and tolterodine are now available and their profiles and role in the once-daily treatment of OAB are discussed below. A32; A9873; A9876-9877.
The district court found, and Allergan does not dispute, that Rovner taught
“an extended-release formulation should have a lower Cmax and higher Cmin than
its corresponding immediate release formulation.” A32. The court found that
Rovner discloses that the extended-release tolterodine formulation (Detrol LA) fell
within these limits (i.e., a lower Cmax and a higher Cmin than immediate-release
Detrol).10 A32; A9875.
The district court found and the evidence supports that as of 2002,
significant market pressure would have motivated a POSA to develop once-daily
trospium. A32-33. By 2002, the entire market for OAB drugs in the U.S. was
moving to once-daily dosage forms, and this was a significant motivating factor for
the once-a-day trospium project. A8518-8519; A10226:6-15; A10229:2-11;
A10272:9-274:4; see also A10320:1-321:7. The same cannot be said for the many
years before Rovner and this market pressure, contrary to Allergan’s argument that
“decades” of inaction is proof of nonobviousness. Graham, 383 U.S. at 36 (fact
10 The POSA would have also known that oxybutynin, with an even lower bioavailability than trospium, was successfully reformulated into a once-daily product (Ditropan XL), suggesting trospium could also be so formulated. A11212:1-3.
41
that industry did not make an invention before important prior art became available
is not probative of nonobviousness).
D. Differences Between the Claims and Prior Art
The district court found that the prior art discloses each of the claim
limitations and that a POSA would have been motivated to combine these elements
to make a trospium composition for once-daily administration with a reasonable
expectation of success. A16-38.
1. Controlled-Release Multiparticulates Were Legion in the Prior Art
Regarding claim limitations to “controlled release solid, trospium chloride-
bearing particulates” “comprising at least one polymer selected from enteric
polymers, release controlling polymers, or combinations” (A97-122 at A120,
claims 1-3, 19-20; A175-199 at A198, claims 1, 10 and 18), and further limitations
to enteric polymers (A97-122 at A120, claim 18), the district court credited the
testimony of Dr. Kibbe that prior art disclosed multiparticulate controlled-release
formulations utilizing at least one polymer selected from enteric polymers, release
controlling polymers, or combinations. A18-25. It also found that combinations of
XR, DR, and/or IR components (A148-174 at A172, claim 1, A97-122 at A120,
claim 1; A123-147 at A147, claim 1) and combinations of XR and DR components
(A148-174 at A172, claim 10; A175-199 at A198, claim 10) were known in the art.
Id. For example, the district court found that multiparticulate formulations were
42
“standard technology” disclosed in several prior-art references including the ’570
patent on Carbatrol, which teaches the combination of IR, ER, and DR pellets
including pellets coated with enteric or other release controlling polymers. A18-20,
crediting Dr. Kibbe, A10872; A10875-6; A9044-9050.
The court found the claim limitation that the DR component releases at a pH
of about 7.0 (A148-174 at A172, claim 16) was disclosed in the art, including
CA ’155, CA ’560, and the ’819 patent. A19-25; A9068-9083, A9795-9823;
A9051-9067.
The court credited Dr. Davis that multiparticulate dosage forms using
extended-release and delayed-release pellets were “conventional” and “well-known
systems that had been described in the literature and patents” A19; A11472:7-11;
A11475:12-1476:14; A11520:8-14. It credited Dr. Kibbe’s testimony that
multiparticulate formulations were preferred because pellets with different release
characteristics can be combined in a single dosage form, and that they promote
absorption by dispensing particles widely along the GI tract. A18-19; A10870:4-
872:2.
2. The Prior Art Taught Releasing Drug in the Colon for Extended-Release Formulations
The district court found the limitations that the particulate “releases trospium
in the lower GI tract” or “in the ileum, colon or both” (A97-122 at A120, claims 1-
3, 18, 20; A148-174 at A172, claims 1, 10; A175-199 at A198, claims 1, 10, 18;
43
A123-147, claim 1) or more specifically in the colon (A97-122 at A120, claim 19)
were known in the art. A25, A32.11 For example, the court found that several
prior art references, including the ’570 patent, CA ’155, CA ’560, and the ’819
patent taught multiparticulate formulations that release drug in the lower GI tract
and colon. A18-25; A9044-9050; A19-25; A9068-9083, A9795-9823; A9051-
9067. In addition, the district court credited the testimony of Dr. Kibbe that
releasing trospium in the lower GI tract was suggested in the prior art, and because
trospium had limited absorption in the lower GI tract, targeting release there to
obtain a once-a-day formulation would be “a natural consequence of that.” A32;
A11040:22-1042:2; A11042:8-1043:7. Dr. Davis agreed. A11486:24-1489:2.
3. Steady-State Blood Levels and PK Parameters of Immediate-Release Trospium Are In the Prior Art
Finally, the court found that the claim limitation that the once-daily
formulation achieve steady-state blood levels of trospium (i) comparable to the
twice-daily administration of the 20 mg immediate-release tablets (A97-122 at
A120, claim 1, 18, 19); and (ii) in the range of about 0.5 ng/ml to about 6:0 ng/ml
(A97-122 at A120, claim 2, 20; A148-174 at A172, claims 1, 10, 16; A175-199 at
A19, claims 1, 10, 18) are disclosed in the prior art. A26-27; A9121-9129; A9130-
9141; A9583-9781. The court also found that the claim limitation requiring steady 11 The lower GI tract was construed to mean the ileum and/or colon. Thus, the limitations requiring at least some release in the “lower GI tract” or in the “ileum, colon or both” have equal scope. A64; A013913-13915.
44
state Cmax levels of trospium in the range of about 2.5 ng/ml to about 4.5 ng/ml
and Cmin levels of trospium in the range of about 0.5 ng/ml to about 1.5 ng/ml
(A97-122 at A12, claim 3) were disclosed in the art and known to a POSA. Id.
The court found that IR trospium had a known Cmax of 3-5 ng/ml (A9121-
9129; A9130-9141) and a known Cmin of about 0.6 ng/ml (A9583-9781). A24. In
addition, the court credited Dr. Kibbe’s testimony that a POSA making a
sustained-release formulation has the “goal of having a lower Cmax and slightly
higher Cmin” than the IR dosage form. A26-27; A31; A11035:21-1036:12. The
court also found that Rovner (A9871-9879) taught targeting blood levels based on
the IR formulation with the Cmax lower and the Cmin higher than the IR
formulation. A32-33; A9873. Rovner also taught that this approach was
successfully used in the development of a once-daily formulation of the OAB drug
tolterodine (Detrol LA). Id.
Regarding limitations to “minimizing side effects” (A175-199 at A198,
claim 1, 10, 18), the court credited Dr. Kibbe’s testimony that this is a natural
consequence of reducing the Cmax of the once-daily formulation, because there
was a documented relationship between dry-mouth and peak trospium levels.
A32-34; A11053:7-1055:15; see also A9871-9879.
The court also found that the claim limitation requiring “average Cmax at
steady state of less than 2400 pg/ml and at a Tmax of less than 6 hours (A123-147
45
at A147, claim 1) were disclosed in the art. Targeting the trospium levels of a
once-daily formulation to have a lower Cmax than the IR formulation (3-5 ng/ml)
was known, as was the goal to delay the Tmax as compared to the IR trospium
formulation, which is about 5 hours. A31; A11045:7-1048:11, A9583-9781.
E. There Was No Evidence Showing Objective Indicia of Nonobviousness
1. Allergan Failed to Present Evidence of Long-Felt Need
In support of its finding of no demonstrated long-felt need, the district court
cited substantial evidence, including testimony of Drs. Sandage and Kidane, that
once-a-day formulations were where the “market [was] headed” by 2002. A45;
A10226:6-15; A10229:2-11; A10272:9-274:4; A10320:1-321:7. The district court
correctly found this “demonstrate[s] that the need for once-daily OAB
formulations was generated by market development and demand in the early 2000s,
just prior to formulation of the claimed invention.” A45; A8518-8519; A9871-
9879.
Allergan’s argument that this was “clear error caused by . . . hindsight
analysis” because “[t]here is no evidence the need for once-a-day overactive
bladder drugs appeared only in 2000” (Br. at 60), has it backwards: defendants
showed that the need was caused by recent market pressure, and Allergan did not
show otherwise. Ditropan (oxybutynin) and Detrol (tolterodine) were available in
the U.S. as IR products since 1975 and 1998, respectively, and not converted to
46
once-a-day products until 1999 and 2000. A3; A10861:17-862:8; A9871-9879 at
9873 and 9875.
2. There Is No Evidence Anyone Failed Making Once-Daily Trospium
Allergan presented no evidence to show that Madaus failed to make the
claimed invention. Dr. Sandage testified that he was not sure if or when he learned
Madaus was trying to make a once-daily formulation of trospium, and that he
“might have known they were thinking about it and had done some work on it.”
A10158:10-16. He did not testify about how much work, if any, Madaus actually
did. And Sandage was unpersuaded by Fuhr’s alleged nay-saying, telling Madaus
“I have got to try because that’s where the market’s headed.” A10272:19-274:4.
Indeed, even after Fuhr allegedly told Sandage once-daily trospium would not
work, Indevus remained “optimistic” that once-daily trospium could be made
“easily” based on trospium’s long half-life. A37; A9201-9203 at 9203;
A10256:20-257:3.
Madaus’ alleged attempt to reduce the frequency of dosing by doubling the
immediate-release dosage to 80 mg does not compare to the “tried and failed”
evidence found to be compelling in Cyclobenzaprine, in which Alza invested $10
million in formulation development using the conventional approach to sustained-
release formulations and proved by doing so that the conventional approach did not
work for cyclobenzaprine. 676 F.3d at 1081-82. Even if Allergan’s spin on the
47
facts and the inferences were accepted—in disregard of the district court’s fully
justified findings to the contrary—it does not show that Madaus put meaningful
resources into a serious effort to make a once-daily formulation.12
Allergan’s talismanic incantation of “Dr. Fuhr” as some super-formulator
and master of all-things trospium is as pointless as it is tiresome: there is no
evidence that Dr. Fuhr spent time on these supposed efforts, was ever tasked with
developing a once-daily formulation, or had the resources and interest to undertake
such efforts while a full-time professor at University of Cologne. Allergan not
only failed to bring Dr. Fuhr to trial or obtain his testimony by deposition—despite
his role as a consultant to its licensor Madaus, which has a financial interest in the
sales of Sanctura XR in Europe—it did not even have Dr. Davis give him a phone
call. A11507:14-20. Having shielded Dr. Fuhr from cross-examination, and
“proven” his supposed analysis through hearsay, Allergan cannot assign error to
12 Nagy v. L. Mundet & Son, Inc., 101 F.2d 82, 82 (2d Cir. 1939) (L. Hand, J.) (“It is not safe to assume, because a single manufacturer for a few years has not discovered an improvement, that it was beyond the powers of rather commonplace talent; like most people he may have been content to let things stand, if his business was otherwise satisfactory; and that may be true, even when he accepts the change after it is brought to his notice. The case is much stronger for an invention when it appears at the end of a period of active competition among several manufacturers; though even then four years is not a very long time upon which to base any inference.”).
48
the district court’s finding that its evidence was unconvincing, and certainly cannot
show that that the district court made “clear error” in not crediting this evidence.13
3. Bayer and Madaus’ Alleged Skepticism Does Not Show Nonobviousness
The district court found the evidence did not establish skepticism of others.
A47-49. Dr. Sandage could not recall significant facts and had no documents to
support his testimony. A10189:10-12; A10248:5-249:4; A10250:10-23;
A10251:6-17; A10254:9-21.14
Dr. Bhatt’s only memory of his discussions with Bayer was “a general sense
of skepticism from them regarding the chances of success in developing a once-a-
day controlled release product of trospium,” and “that’s it.” A11347:19-1348:2.
Skepticism has relevancy to an obviousness inquiry if it sheds light on the
circumstances surrounding the origin of the subject matter sought to be patented.
Graham, 383 U.S. at 17-18. Skepticism has been rejected when there is no
evidence that the skeptic had knowledge of all the prior art. PharmaStem
Therapeutics, Inc. v. Viacell, Inc., 491 F.3d 1342, 1365 (Fed. Cir. 2007). Similarly,
skepticism has been found insufficient to overcome a strong showing of
obviousness absent a nexus between the skepticism and the claimed invention. 13 Had this been a jury trial, Watson would have requested a missing-witness instruction if Allergan invoked Dr. Fuhr in closing arguments the way it now does on appeal. 14 Dr. Sandage was also paid by Allergan to come to trial, even though he was a fact witness. A10277:12-24.
49
Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318, 1327–28 (Fed. Cir. 2008)
(finding secondary considerations, including praise, skepticism, copying, and
commercial success, to be insufficient due to a lack of a clear nexus or an inability
to overcome a final conclusion that the claims were obvious). Here, the facts were
insufficient to show such nexus.15
4. The Schröder Poster Teaches Toward, Not Away From, the Asserted Claims
Allergan’s argument that Schröder “teaches away” from the claimed
invention is undercut by the district court’s express findings—supported by
substantial evidence—that (i) Schröder does not teach away from the claimed
invention, and (ii) a POSA interested in developing once-daily trospium would
have found Schröder encouraging. A41-43. See Para-Ordinance Mfg., Inc. v. SGS
Importers Int’l, Inc., 73 F.3d 1085, 1088 (Fed. Cir. 1995) (whether prior art teaches
away in an issue of fact). The court credited the testimony of Drs. Kibbe,
Mayersohn, and Flanner, each of whom questioned the legitimacy of Schröder’s
methodology. A42; A11010:17-1011:16; A11020:1027:22; A11210:4-22;
15 Allergan erroneously asserts that the district court was “legally and factually wrong” that the testimony involved unnamed Bayer employees. Br. at 55-56. The document Allergan cites (A8432) is an e-mail from Indevus with names of Bayer personnel scheduled to do a conference call that never took place. See A8503 (“the Indevus/Bayer/Shire conference call . . . will have to be rescheduled.”). The e-mail relied on by Allergan to show Bayer’s alleged skepticism is the same e-mail announcing the cancellation of the call. This e-mail goes on to describe statements by unnamed Bayer employees.
50
A11259:20-1260:20; A11272:9-16; A11335:12-1336:9. Allergan presented no
first-hand testimony concerning how anyone interpreted Schröder other than
through Dr. Davis, whose testimony (i) bolstered Drs. Kibbe and Mayersohn’s
conclusion that the results of the study were speculative, inconclusive, and
inconsistent with known therapeutic effectiveness of trospium suppositories, and
(ii) undermined Allergan’s argument that it taught away from the claimed
invention. A46; A11462:7-15; A11463:12-20; A11458:10-1465:4.
Allergan’s “teaching away” argument also stretches that concept beyond its
proper scope. A reference may teach away when a POSA reading it “would be
discouraged from following the path set out in the reference, or would be led in a
direction divergent from the path that was taken by the applicant.” In re Gurley, 27
F.3d 551, 553 (Fed. Cir. 1994). But the disclosure of one alternative does not
teach away from other alternatives unless it criticizes, discredits, or otherwise
discourages them. In re Fulton, 391 F.3d 1195, 1201 (Fed. Cir. 2004). Here, it
cannot be said that Schröder criticizes, discredits, or otherwise discourages an
extended-release trospium formulation that releases some (unspecified) amount of
drug in the lower GI tract and mimics the PK profile of the IR product, because it
has nothing to do with such subject matter. A4986.
Only by a string of inferences and facts that were rejected by the district
court would Allergan’s theory have legs, i.e., if a POSA believed in 2002 based on
51
a 2008 review article that 30% colonic absorption was important to sustained-
release formulations, and if a POSA read Schröder as meaningfully showing a lack
of colonic absorption, and if a POSA did not consider favorably other prior art
indicating that trospium was absorbed in the colon, and if a POSA did not
understand from the prior art ways of overcoming poor colonic absorption. But
those are factual issues resolved against Allergan and supported by substantial
evidence. Even Allergan’s own expert Dr. Davis said that a POSA would have
largely ignored Schröder and given it no more than a minute’s thought. A43;
A11490:8-1492:19.
5. Licensing by Others
The district court properly concluded that Allergan’s case for licensing as a
secondary consideration of nonobviousness not compelling. A47. Allergan’s
reliance on the license to it from Indevus to market Sanctura XR in the U.S. and
the license to Madaus for Sanctura XR in Europe (A10088:10-15; A10190: 1-17;
A10208:23-209:6) fails because Allergan has shown neither (i) that the licenses are
attributable to a belief in the validity of the patent, nor (ii) a nexus between the
licenses and the claimed invention. Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d
1530, 1539 (Fed. Cir. 1983).
Allergan’s decision to in-license Sanctura from Indevus was motivated by
the desire to move into the new area of urologics. A10088:10-15. Allergan
52
obtained rights under the patents as part of a much larger commercialization and
supply agreement (A10190: 1-17; A8242-A8345) that included transfer of the
NDA to Allergan (A8259-10), know-how and trade secrets (A8259; A8251), and
trademarks (A8301).
Similarly, the license to Madaus under foreign patents (A5306-A5367) was
part of a larger commercialization and supply agreement (see A5307). Madaus
obtained an exclusive license to the Sanctura XR trademark (A5315), all Indevus
know-how, including copies of the FDA submissions (A5309, A5314), and a
supply agreement with Indevus. In addition, because the foreign patents are not in
evidence there is no way of telling whether they are relevant to nonobviousness of
the patents at issue here.
These licenses have no probative value as objective indicia of
nonobviousness because there is no evidence to show that either was motivated by
a belief in the validity of the patents, rather than the other substantial rights granted
under the agreements. Stratoflex, 713 F.2d at 1539 (rejecting plaintiff’s licensing
by others where the license included trademarks and other patents stating that
plaintiff “has shown neither a nexus between the merits of the invention and the
licenses of record, nor that those licenses arose out of recognition and acceptance
of the patent”); SIBIA Neurosciences, Inc. v. Cadus Pharm. Corp., 225 F.3d 1349,
1358–59 (Fed. Cir. 2000) (rejecting licensing by others because “the three licenses
53
or sub-licenses of the … patent, all … were part of larger licensing packages” and
thus “failed to point to any evidence establishing a nexus between the licensing
activity and the merits of the claimed screening method”).
F. Reasonable Expectation of Success
The district court found, and substantial evidence supports, that a POSA in
2002 would have had a reasonable expectation of success in making a once-daily
trospium formulation. A34-38. Dr. Davis testified that he would expect the
difficulty of formulating once-daily trospium as “medium difficulty.” A11380:19-
1381:3. Dr. Kibbe testified that using a multiparticulate dosage form to make the
claimed once-a-day formulations would have been “a reasonable approach that is
expected to be successful. You have high expectations of it working.” A11016:6-
13.
Allergan’s argument of legal error regarding the district court’s findings on
reasonable expectation of success (Br. at 62-64) is misplaced because this is a
question of fact. Alza v. Mylan, 464 F.3d at 1289; Velander v. Garner, 348 F.3d
1359, 1370-71 (Fed. Cir. 2003). Allergan would elevate “reasonable expectation
of success” to a fifth Graham factor such that it must be balanced with the others
de novo, but it is part of the overall inquiry into motivation, i.e., a POSA is
unlikely to make modifications or combinations she thinks unlikely to succeed, and
more likely to make them when she thinks they likely will succeed.
54
The district court carefully considered all the teachings in the prior art about
trospium, both positive and negative, considered and credited testimony from both
side’s respective experts, and reasonably found that a POSA would have been
encouraged by trospium’s positive attributes and the teachings on how to remedy
the negative attributes. A34-36. Allergan’s attempt to reargue the facts are
unavailing.
IV. The District Court Erred in Concluding that Watson Infringed the Method Claims
A. Allergan Did Not Prove, and Indeed Disproved, that Watson’s Product Meets the Steady-State Cmax Element of Claim 1 of the ’359 Patent
Each of the asserted claims—except claims 18 and 19 of the ’978 patent—
recites steady-state PK parameters. Because Watson’s ANDA contained only
single-dose data, Allergan’s expert Dr. Weiner used linear superposition to model
the steady state. Dr. Weiner testified that such modeling is “reliable” and “quite
often used.” A10517:5-518:4. Watson did not contest Dr. Weiner’s modeling, and
the district court credited it to find that Watson’s product would meet the steady-
state elements of the asserted claims of the ’978, ’448, and ’449 patents. A77-84.16
16 Watson’s noninfringement defense as to these claims was that Allergan did not prove the site of release in the lower GI tract or colon. The district court, however, found as a matter of fact that Allergan carried its burden of showing the site of release (A66-75), and Watson does not challenge that as clearly erroneous.
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Dr. Weiner’s modeling of the steady-state PK profile of Watson’s product
showed, however, that it did not meet the element of claim 1 of the ’359 patent that
required steady-state Cmax of less than 2,400 pg/mL. Indeed, his modeling proved
noninfringement by showing that the steady-state Cmax of Watson’s product was
3,560 pg/mL. A82; A10530:20-531:4; A8208-11 at A8211. Dr. Weiner testified
that based on his modeling of the Watson product’s steady-state Cmax from its
single-dose data, which he said was the “preferable approach” (A10577:21-578:2),
Watson’s proposed product does not have a Cmax at steady state less than 2,400
pg/mL:
Q. By your modeling techniques, do defendants’ products meet the limitations of having a Cmax at steady state of less than 2400 picograms per milliliter? A. No, they don’t. * * * Q. Now, you just testified, your modeling measurements, do they meet this limitation or not? A. They do not.
A10545:10-546:2. Allergan’s expert Dr. Davis agreed that using Dr. Weiner’s
modeling, Watson’s product does not infringe the ’359 patent:
Q. The data that [Dr. Weiner] did model from the defendants’ products shows that they do not infringe that claim because the Cmax is above 2400; correct? A. Correct.
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A10697:22-698:5. Rather than dropping this claim, Allergan argued that Watson
infringes because Sanctura XR has a steady-state Cmax of less than 2,400 pg/mL,
and that Watson somehow “adopted” this number by copying the single-dose PK
data from the label of Sanctura XR, even though neither the Sanctura XR label nor
the Watson label includes steady-state data for either product.
Because there is no dispute as to the pertinent characteristic of the Watson
product, the content of the label, or the accuracy of Dr. Weiner’s modeling, the
typical two-step infringement analysis collapses into a single question that can be
resolved as a matter of law. Cf. Desper Prods., Inc. v. QSound Labs, Inc., 157
F.3d 1325, 1332-33 (Fed. Cir. 1998) (resolution of infringement on summary
judgment appropriate when material characteristics of accused product are not
subject to genuine dispute). Here, the district court erred because the proper
infringement inquiry compares the asserted claims to the product that is likely to be
sold following FDA approval, Glaxo, Inc. v. Novopharm, Ltd., 110 F.3d 1562,
1570 (Fed. Cir. 1997), and Dr. Weiner’s linear superposition modeling, relied on
by Allergan and adopted by the district court, proves that Watson’s product will
not infringe claim 1 of the ’359 patent.
The district court erred by relying on the steady-state Cmax of Sanctura XR
from a paper published in 2010 to conclude that Watson’s product infringed. A84-
86. This was error because there are no special rules for infringement in ANDA
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cases, Glaxo, 110 F.3d at 1567-68, and liability “is determined by traditional patent
infringement analysis.” Warner-Lambert Co. v. Apotex Corp., 316 F.3d 1348,
1365-66 (Fed. Cir. 2003). Thus, the district court should have compared the claims
to the product that Watson is likely to sell, not to Sanctura XR.
Allergan’s argument at trial that Adams Respiratory Therapeutics v. Perrigo
Co., 616 F.3d 1283 (Fed. Cir. 2010), permitted trial courts to compare a
bioequivalent ANDA product to the branded product to show infringement is
unavailing. That decision vacated the district court’s summary judgment of
noninfringement for errors of claim construction, and observed for the claim
limitation at issue there (ER product having a Cmax “equivalent” to the Cmax of
an IR product) that when a commercial product meets all of the claim limitations,
“then a comparison to that product may support a finding of infringement.” Id. at
1289 (emphasis added). It did not (and could not) hold that bioequivalency
necessarily establishes infringement or trumps actual evidence of noninfringement.
Allergan led the district court into error by conflating the single-dose PK
data on Sanctura XR’s label (which was copied to Watson’s proposed label) with
steady-state PK data on Sanctura XR published years later in the 2010 Silver paper.
Specifically, the district court erroneously concluded that Watson infringed
because “defendants can be held to their published steady state Cmax value, which
fall within claim 1 of the ’359 patent.” A85. However, Watson’s proposed label
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(and Sanctura XR’s label) only reports single-dose PK data. A8072-8093 at 8084;
A8094-8137 at 8116. The “published steady-stated Cmax value” is from Allergan,
not Watson, and is for Sanctura XR, not for Watson’s product.
Claim 1 of the ’359 patent requires that the formulation provides “an
average Cmax at steady state of less than 2400 pg/ml,” which was not proven for
the Watson product and actually disproven by Allergan’s own evidence. Therefore,
the district court’s finding of infringement of claim 1 of the ’359 patent must be
reversed.
B. Allergan Did Not Prove Inducement of the Asserted Method Claims
1. Allergan Did Not Prove Indirect Infringement of the ’359 Patent By Inducement
Other fatal deficiencies exist in Allergan’s inducement proof of the ’359
patent. Inducement requires knowledge that the induced acts constitute patent
infringement, and at least some intent is required. Global-Tech Appliances, Inc. v.
SEB S.A., 131 S. Ct. 2060, 2065, 2068 (2011).
The district court found that Watson infringed claim 1 of the ’359 patent by
inducement because Watson would have known that persons using its ANDA
product were likely to infringe any patent rights associated with PK data copied
from the Sanctura XR label. A86. This finding was clearly erroneous because
Allergan presented no evidence that Watson possessed the requisite levels of
59
knowledge and intent to induce infringement. Watson cannot be charged with
knowledge or intent based on the steady-state data for Sanctura XR published in
the 2010 Silver paper because Allergan never established that Watson had
knowledge of the paper.17 And while it may be reasonable in some cases to infer a
defendant’s knowledge of unstated characteristics of its own product, doing so here
would impute to Watson proof of noninfringement, because the modeled steady-
state Cmax of its product—according to Allergan and the district court—is 3,560
pg/mL, not less than 2,400 pg/mL. A82. And certainly intent to induce
infringement cannot be inferred from sale of a product that does not meet all
elements of the claim. Accordingly, Watson cannot be found liable for inducement.
2. Allergan Did Not Prove Indirect Infringement of the ’449 Patent By Inducement
Allergan also argued that Watson infringed the ’449 patent by inducement.
The claims of the ’449 patent are directed to a “method for treating bladder
dysfunction in a mammal comprising an oral administration . . . of a once-daily
dose of a pharmaceutical composition comprising . . . trospium chloride, where
said administration . . . results in minimizing the occurrence of side effects as
compared to twice daily administration of 20 mg of immediate release trospium
chloride tablets.” A175-199 at 198.
17 The Silver paper was published in 2010, more than a year after Watson’s ANDA was submitted to FDA.
60
Just as it did with the ’359 patent, Allergan relied on the 2010 Silver paper
to prove direct infringement of the ’449 patent because that paper was said to show
the “minimizing of side effects.” A10685:3-17. Because Allergan did not
establish that Watson had knowledge of the 2010 Silver paper, Watson cannot be
charged with knowledge (or intent) that its product would “result[] in minimizing
the occurrence of side effects as compared to twice daily administration of 20 mg
of immediate release trospium chloride tablets.” There is nothing on Watson’s or
Sanctura XR’s label to suggest that extended-release trospium would meet this
limitation. Indeed, Dr. Davis admitted:
(1) there is nothing on Watson’s proposed label that compares side effects of its proposed product to side effects observed with the immediate-release twice-a-day trospium product (A10716:17-22); (2) Watson’s proposed label does not report side effect data from the immediate-release twice-a-day trospium product (A10716:23-717:1); and (3) there is no information with the four corners Watson’s proposed label, or the label of Sanctura XR, that once-daily trospium reduced or minimizes side effects as compared to the immediate-release product. (A10717:2-11)
The district court concluded that Watson induces infringement of claim 1 of
the ’449 patent because (i) defendants had knowledge of the ’449 patent and
intended for their products to be used consistent with the labeled conditions copied
from the Sanctura XR label, and (ii) defendants made statements to the FDA that
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their proposed products were developed to “mimic” or “match” the claimed
invention. A91-93. This conclusion is error for two reasons.
First, Watson’s knowledge of the ’449 patent is necessary but not sufficient.
Rather, the key point is whether Watson had knowledge and intent that its product
infringe by meeting each element of the asserted claims. Allergan presented no
evidence that Watson possessed the requisite knowledge and intent because it
failed to show that Watson had knowledge of the 2010 Silver paper. In addition,
Allergan did not show that Watson compared the side-effect data of its product (or
of Sanctura XR) to the side-effect data of immediate-release trospium, as Allergan
did in its attempt to prove infringement. Nor can such a comparison be inferred,
given that Watson does not market immediate-release trospium.
Second, contrary to the district court’s finding, Watson did not make
statements to the FDA that its proposed product was developed to “mimic” or
“match” the claimed invention. A93. Rather, Watson stated that its ANDA
product “was designed to have a similar drug release profile as the RLD.” A8138-
8168 at 8138 (emphasis added). This statement cannot be used to infer that
Watson had knowledge or intent that its trospium product would result in
minimizing side effects compared to immediate-release trospium, nor can it be
used to infer that Watson compared the incidences of side effects observed from
administration of Sanctura XR to immediate-release Sanctura, as Allergan did to
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try to prove infringement. Accordingly, Watson cannot be found liable for
inducement.
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CONCLUSION
For the foregoing reasons, the district court’s judgment should be affirmed.
Respectfully submitted, /s/ Charles A. Weiss Charles A. Weiss
DATED: June 1, 2012
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CERTIFICATE OF SERVICE AND FILING
I certify that on June 1, 2012, the foregoing Responsive Brief of Defendant-
Appellee Watson Laboratories, Inc. – Florida was electronically filed with the
Clerk of Court using CM/ECF and served by e-mail to:
Jonathan E. Singer, Esq. Fish & Richardson P.C. 60 South Sixth Street 3200 RBC Plaza Minneapolis, MN 55402 [email protected]
Attorneys for Plaintiffs-Appellants
Deanne E. Maynard, Esq. Morrison & Foerster LLP 2000 Pennsylvania Avenue, NW Suite 6000 Washington, DC 20006 [email protected]
Attorneys for Defendant-Appellee Sandoz Inc.
Wendy M. Ward, Esq. Merchant & Gould P.C. 3200 IDS Center 80 South 8th Street Minneapolis, MN 55402 [email protected]
Attorneys for Defendant-Appellee Paddock Laboratories, Inc.
/s/ Charles A. Weiss
Charles A. Weiss
Dated: June 1, 2012
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CERTIFICATE OF COMPLIANCE WITH TYPE-VOLUME LIMITATION, TYPEFACE REQUIREMENTS,
AND TYPE STYLE REQUIREMENTS
1. This brief complies with the type-volume limitation of Federal Rule of Appellate
Procedure 32(a)(7)(B) or Federal Rule of Appellate Procedure 28.1(e).
The brief contains 13,923 words, excluding the parts of the brief exempted
by Federal Rule of Appellate Procedure 32(a)(7)(B)(iii).
2. This brief complies with the typeface requirements of Federal Rule of Appellate
Procedure 32(a)(5) or Federal Rule of Appellate Procedure 28.1(e) and the type
style requirements of Federal Rule of Appellate Procedure 32(a)(6).
The brief has been prepared in a proportionally spaced typeface using
Microsoft 2003 in 14 point Times New Roman font.
/s/ Charles A. Weiss CHARLES A. WEISS
Attorney for Defendant-Appellee Watson Laboratories, Inc. — Florida
DATED: June 1, 2012