Significant Recent Decisions of the Court of Appeal for the Federal Circuit on Pharmaceutical Patent Practice

1. Introduction

In the first ten days of April, the Court of Appeals for the Federal Circuit issued three decisions of significance to the pharmaceutical industry. In In re Kubin, the Court affirmed a decision of the Board of Appeals of the USPTO that claims to an isolated polynucleotide molecule encoding a polypeptide at least 80% identical with a defined amino acid sequence in a known polypeptide was obvious over that known polypeptide. In Ariad Pharmaceuticals Inc. v. Eli Lilly and Company the Court reversed a district court decision to hold that a claim to modifying external influences on a cell by inhibition of expression of a gene whose transcription is regulated by NF-κB by reducing NF-κB binding to its recognition sites on the gene complied with the written description requirement of 35 USC 112, the Court of Appeals finding that the description failed to show that there was true possession of the invention at the time of filing the application because no compounds capable of effecting such inhibition were disclosed. The third decision writes a further chapter in the saga of US Patent 5,583,216 (Ochiai, having a priority date of December 19, 1974). In Takeda Pharmaceutical Corp. v. Doll, the Court of Appeals vacated the decision of the district court and remanded the case for further fact finding on the question of whether claims to a method of making certain acylated cephems constituted double patenting over earlier claims to the acylated cephems themselves.

2. In re Kubin

Looking first at In re Kubin, this arose from an appeal from the Board of Appeals decision was in Ex parte Marek Z. Kubin et al[1]. In this case the issue the claimed step forward in the art was the alleged discovery of a binding relationship between NAIL (which had been previously identified as being present as a receptor on certain cells but had not previously been sequenced) and a protein known as CD48. Such binding has biologically important consequences for natural killer (NK) cells. The issue before the board of appeal and later the court was whether an isolated polynucleotide molecule encoding a polypeptide at least 80% identical with a specified part of NAIL and binding to CD48 was obvious over the prior disclosure of NAIL’s existence when read in the light of standard knowledge in the biotech arts. In upholding the rejection made by the examiner, the Board noted,

Under KSR, it is now apparent that “obvious to try” may be an appropriate test in more situations than we previously contemplated.

The Board went on to quote the Supreme Court’s comments on “obvious to try” when there are a finite number of identified predictable solutions to a problem. In the case before it the Board found that there were a limited number of methodologies as to how to isolate the desired polypeptide. Thus the Board concluded

The skilled artisan would have had reason to try these methodologies with a reasonable expectation that at least one would be successful.

Thus the polynucleotide coding for this polypeptide was not patentable because isolation of the polypeptide was obvious. [2]

The Board also found there to be inadequate written description to support the breadth of the claim because it did not disclose which parts of the NAIL polypeptide were important for binding with CD 48 at so gave no guidance as to what variants were permitted, thereby indicating that there was a lack of possession of the invention at the time of filing. The Board noted:

Without a correlation between structure and function, the claim does little more than define the claimed invention by function. That is not sufficient to satisfy the written description requirement.

In its decision, the Federal Circuit in a decision authored by Judge Rader upheld the PTO decision on obviousness and did not reach the question of whether the written description requirement had been met.

On obviousness, the appellants argued that the prior disclosure of the NAIL polypeptide was non-enabling and also that there were some suggestions in the art that it might not be expressed in humans and that the art did not teach the binding with CD 48 that was so important.

The court dismissed the first of these by saying that the applicant could not rely on standard knowledge to argue that it had fully described the invention and at the same time argue that this knowledge could not be applied to the question of whether the prior art was enabling. It saw no relevance in the question of whether the prior art might have been skeptical about expression in humans. On the question of the applicant’s discovery of the binding between the polypeptides that were coded by the claimed polynucleotide, the court noted that such properties were inherent in the prior art polypeptide and that one could not claim an old product as new even if it had hitherto unknown properties.

The court then went on to consider the Appeal Board’s comments on “obvious to try”. After noting that the Supreme Court in KSR v. Teleflex had held that the approach that the Federal Circuit had taken in its decision in In re Deuel has been wrong, Judge Rader continued:

The Supreme Court’s admonition against a formalistic approach to obviousness in this context actually resurrects this court’s own wisdom in In re O’Farrell[3], which predates the Deuel decision by some seven years.

It is true that this court and its predecessors have repeatedly emphasized that “obvious to try” is not the standard under § 103. However, the meaning of this maxim is sometimes lost. Any invention that would in fact have been obvious under § 103 would also have been, in a sense, obvious to try. The question is: when is an invention that was obvious to try nevertheless nonobvious?

In re O’Farrell, 853 F.2d 894, 903 (Fed. Cir. 1988). To differentiate between proper and improper applications of “obvious to try” this court outlined two classes of situations where “obvious to try” is erroneously equated with obviousness under § 103. In the first class of cases, what would have been ”obvious to try” would have been to vary all parameters or try each of numerous possible choices until one possibly arrived at a successful result, where the prior art gave either no indication of which parameters were critical or no direction as to which of many possible choices is likely to be successful. Id.

In such circumstances, where a defendant merely throws metaphorical darts at a board filled with combinatorial prior art possibilities, courts should not succumb to hindsight claims of obviousness. The inverse of this proposition is succinctly encapsulated by the Supreme Court’s statement in KSR that where a skilled artisan merely pursues “known options” from a “finite number of identified, predictable solutions,” obviousness under § 103 arises. 550 U.S. at 421.

The second class of O’Farrell’s impermissible “obvious to try” situations occurs where what was “obvious to try” was to explore a new technology or general approach that seemed to be a promising field of experimentation, where the prior art gave only general guidance as to the particular form of the claimed invention or how to achieve it. 853 F.2d at 903.

Again, KSR affirmed the logical inverse of this statement by stating that § 103 bars patentability unless the improvement is “more than the predictable use of prior art elements according to their established functions” 550 U.S. at 417.

This court in O’Farrell found the patentee’s claims obvious because the Board’s rejection of the patentee’s claims had not presented either of the two common “obvious to try” pitfalls. Specifically, this court observed that an obviousness finding was appropriate where the prior art “contained detailed enabling methodology for practicing the claimed invention, a suggestion to modify the prior art to practice the claimed invention, and evidence suggesting that it would be successful.” 853 F.2d at 902 (emphasis added).

Responding to concerns about uncertainty in the prior art influencing the purported success of the claimed combination, this court stated:

“[o]bviousness does not require absolute predictability of success … all that is required is a reasonable expectation of success” Id. at 903-04 (emphasis added). The Supreme Court in KSR reinvigorated this perceptive analysis.

KSR and O’Farrell directly implicate the instant case.

Having said this, the Court went on to find that one skilled in the art clearly had a reason to seek the DNA that coded for NAIL, the teaching necessary to try to find that DNA and a reasonable expectation of success in finding that DNA. This was enough to render the claimed invention obvious.

3. Ariad v. Eli Lilly

In Ariad Pharmaceuticals v. Eli Lilly[4], the patent in suit was for inhibiting expression of a gene whose transcription is regulated by NF-κB by reducing NF-κB binding to its recognition sites on the gene. The basic contribution to the art was the realization that NF-κB is present in many cell types and acts as an intracellular messenger capable of playing a broad role in gene regulation. Hence the applicants claimed in one of the claims in suit:

A method for modifying the effects of external influences on a eukaryotic cell , which external influences induce NF-κB mediated intracellular signaling, the method comprising altering NF-κB activity in the cells such that NF-κB mediated effects of external influences are modified wherein NF-κB activity in the cell is reduced wherein reducing NF-.6B activity comprises reducing binding of NF-κB to NF-κB recognition sites on genes that are transcriptionally regulated by NF-κB.

The patent was granted on a number of continuing applications. The specification suggested that the binding reduction set out in the claim could be effected in one of three ways, specific inhibitors, dominant interfering molecules and decoy molecules. One specific inhibitor was mentioned, in the granted patent, no dominant molecules were disclosed and some structures for decoy molecules were proposed. As it turned out unfortunately for Ariad, the jury found that the effective date of the patent was prior to the filing of the application containing the description of the inhibitor so there was no description of the inhibitor in the application that was found to provide the effective date of the claims in suit.

Prior to the inventor’s discovery of the presence of NF-κB in many cells, the defendants had applied for patents on two compounds for treatment of osteoporosis and sepsis. It was later found that these drugs worked by inhibiting expression of a gene whose transcription is regulated by NF-κB. Nevertheless, the district court found there to be no anticipation of the claimed invention. The patent claim required that there was a reduction of NF-κB in a cell to achieve a desired result. This, it was argued had not been achieved in the prior art and so the invention claimed was new.

On appeal to the Federal Circuit, the Federal Circuit panel hearing the appeal did not need to reach this issue as it found that the claims were invalid for lack of a written description. In her opinion authored for the panel, Judge Moore first noted what had been said in University of Rochester v. G. D. Searle & Co.:[5]

Regardless of whether a compound is claimed per se or a method is claimed that involves use of the compound, the inventor cannot lay claim to that subject matter unless he can provide a description of the compound sufficient to distinguish infringing compounds from non-infringing compounds or infringing methods from non-infringing methods.

In determining whether this was done, one could look to what was known in the art. In present case, however, “the invention was made in a new and unpredictable field where the existing knowledge and prior art was scant.”

On whether the patent met the statutory requirements, Ariad first argued that since the claims did not refer to any particular molecules, there was no need to describe them. The judge dismissed this argument pointing out that to show possession of the claimed method there had to be sufficient disclosure of the compounds used for carrying it out.

On the question of whether the description of the molecules was adequate, she found that the evidence on the inhibitor that was described in the final patent showed that at the effective date of the claims it was known to exist and the means existed to isolate it. This, however, was insufficient to show that the inventors had possession of a method of altering NF-κB by use of the compound. So far as use of dominant molecules were concerned, the specification made it clear that these could work only if two specific domains in the protein used for this purpose were spatially separated. However, the specification gave no guidance on determining this and indeed did not give any information as to spacing in NF-κB itself. These factors made the absence of disclosure of specific compounds of this type a fatal defect. The fact that others came up with such molecules later was not sufficient to show possession at the effective date. Finally on decoy molecules, even though possible structures were set out, no synthesis was provided and the court regarded the teaching as prophetic rather than a showing of possession. The court seemed to see this as an attempt to preempt the future before it had arrived and insufficient a thread on which to hang the broad claims in suit. The written description requirement had therefore not been met and the claims were invalid.

Subsequent to the original publication of this News Bulletin, the Federal Cicruit agreed on August 21, 2009, to review the panel’s devision en banc. The issues to be considered in the rehearing are:

(1) “Whether 35 U.S.C. 112, paragraph 1, contains a written description requirement separate from an enablement requirement?”, and

(2) “If a separate written description requirement is set forth in the statute, what is the scope and purpose of the requirement?”

4. Takeda Pharmaceutical Corp. v. Doll

So far as the third of April’s Federal Circuit decisions is concerned, the saga begins with the Federal Circuit’s decision in 1995 in In re Ochiai[6]. The claim in question defined a process “introducing” the acylating group into a cephem without specifying any method for doing so. Because the acylating agent was new, the court found this to be new and non-obvious thereby reversing earlier case law that had required a measure of inventivity in the nature of the reaction itself for patentability in similar circumstances. The Examiner had an acid used and the product made were not taught in the prior art and had relied on such earlier case law in making the rejection. The Federal Circuit, noting that it would not have been obvious to choose the particular acid used by Ochiai as an acylating agent for the simple reason that the particular acid was unknown, reversed the obviousness rejection. Because of the very broad way in which the operational step of the claim was drafted, competitors alleged that the grant of this patent was tantamount to providing an extension of the patent on the products themselves, which had expired in 1999. This led to re-examination of whether the claims as allowed as being non-obvious were nevertheless invalid on the ground of double patenting. The PTO held that they were. The decision was appealed to the district court. In Takeda Pharmaceutical Corp. v. Dudas[7] the district court, relying on a particular reading of an earlier Federal Circuit decision in U.S. Steel Corp. v. Phillips Petroleum, held that in looking to see whether double patenting existed it was permissible to look at later developments which might make feasible means for implementing the invention of a claim of one patent without infringing the claim of another patent over which double patenting was alleged so that a finding of double patenting could be avoided. It found that there were now alternative routes for making the compounds produced by the claimed process and so the claimed method did not constitute impermissible double patenting of the compounds claimed in the expired earlier patent.

The Director of the USPTO appealed to the Court of Appeals for the Federal Circuit, arguing that double patenting existed unless the claims of two patents in question were patentably distinct at the date of invention. Takeda argued that this was too narrow approach and that, as had been found by the district court, any later developments should be taken into account.

In a decision by Judge Rader, with which Judge Schall concurred in part and dissented in part, the Federal Circuit has now found itself unpersuaded by either approach. The court found that the relevant date was that on which the application giving rise to the second patent was filed since this was the date at which the applicant made an assertion that the invention was patentably distinct from what was claimed in the earlier patent. Use of this date as the date for making the determination was seen as giving the applicant the benefit of some developments in the art while avoiding the inequitable situation that could arise when the applicant seeks to rely on developments decades after the filing of the application giving rise to the second patent. It was also consistent with the decision in the Phillips case where the developments in question had occurred prior to filing the application for the second patent. Because the evidence was unclear on whether an alternative method existed at the time of the filing of the patent application giving rise to the process patent, the case was remanded to the district court for further determination of the relevant facts. Judge Schall would have agreed with the Director and found the relevant date to be the date of invention.

[1] 83 USPQ2d 1410 (BD PatApp & Int., 2007).

[2] The Board disposed of arguments based on In re Deuel [51 F.3d 1552, 34 USPQ2d 1210 (Fed. Cir., 1995)] which had held that the DNA coding for a polypeptide was not obvious from the polypeptide itself by referring to In re Wallach [378 F.3d 1330, 71 USPQ2d 1939 (Fed. Cir.,
2004)] which had found that the state of the art had advanced since the time of Deuel’s invention.

[3] 853 F.2d 894, 903 (Fed. Cir,, 1988).

[4] 529 F.Supp 2d. 106 (D. Mass., 2006).

[5] 69 USPQ2d 1886 (Fed. Cir., 2004). Petition for rehearing denied 71 USPQ2d 1545 (Fed. Cir., 2004).

[6] 37 USPQ2d 1127 (Fed. Cir., 1995).

[7] 14 USPQ2d 1365 (DC DC, 2007).

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