Last week, the Federal Circuit confirmed that Idenix Pharmaceuticals will not be the proud recipient of what was previously regarded as the largest damages award ever recorded in a U.S. Yet Another Pharmaceutical Patent Falls Under the Scrutiny of 35 U.S.C. § 112

patent case.  In fact, the majority’s opinion in Idenix Pharmaceuticals LLC v. Gilead Sciences Inc. not only affirmed the district court’s grant of judgment as a matter of law (JMOL) against Idenix and finding that the asserted claims of U.S. Patent No. 7,608,597 were invalid for lack of enablement under 35 U.S.C. § 112, it added insult to injury when it also held that the claims were invalid for lacking written description.

Background

Idenix (acquired by Merck & Co. in 2014) owns the ʼ597 patent, which includes claims directed to a method of treating hepatitis C virus.  In an effort to thwart the launch of Gilead’s first drug for the treatment of chronic hepatitis C, Sovaldi®, which was then awaiting approval by the FDA, Idenix sued its rival for patent infringement in the District of Massachusetts in 2013.  While the suit, which was ultimately transferred to the District of Delaware, was percolating, both Sovaldi® and a second drug Harvoni® were approved by the FDA for market.  The drugs were quickly considered blockbuster drugs for their ability to cure hepatitis C in a large percentage of patients.  However, there was also major controversy over the list price of the drugs—$84,000 for a 12-week regimen of Sovaldi® and $94,500 for a 12-week regimen of Harvoni®.  Not surprisingly, the high price tag and cure rate resulted in huge revenue for Gilead.  In fact, in 2015, Gilead reported it earned over $20 billion on the two drugs.  Suffice it to say, there was a lot at stake in the dispute for both sides.

Claim 1 is illustrative of the asserted claims:

  1. A method for the treatment of a hepatitis C virus infection, comprising administering an effective amount of a purine or pyrimidine β-D-2′-methyl-ribofuranosyl nucleoside or a phosphate thereof, or a pharmaceutically acceptable salt or ester thereof.

After Idenix argued that the key to the claimed invention was the use of nucleosides having a methyl group (CH3) at the 2’ up position, the district court construed the structural limitation “β-D-2′-methyl-ribofuranosyl nucleoside” to require “a methyl group in the 2’ up position and non-hydrogen substituents at the 2’ down and 3’ down positions.”  The 2’ up position is Yet Another Pharmaceutical Patent Falls Under the Scrutiny of 35 U.S.C. § 112shown in the green circle in the structure to the left.  The district court also construed the claims to use a β-D-2′-methyl-ribofuranosyl nucleoside that is effective for the treatment of hepatitis C.

Based on the claim construction, Gilead ultimately conceded infringement before trial.  But, it argued that under the claim construction, the asserted claims of the ʼ597 patent were invalid for both lack of enablement and written description under U.S.C. § 112(a).  Gilead’s rationale was that there are billions of potential nucleosides with a methyl group in the 2’ up position and that a person of ordinary skill in the art would not know, without undue experimentation, which of these nucleosides would be effective for treating hepatitis C.  So, while the jury was relieved of considering infringement, it was tasked with deciding whether the claims were valid under § 112 and if so, what damages were to be paid by Gilead.

In late 2016, the jury sided with Idenix when it upheld the validity of the asserted claims of the ʼ597 patent and awarded Idenix over $2 billion (based on a 10% royalty rate from the sales of both drugs).  Gilead pleaded with the district court in post-trial motions to overturn the verdict and also hold that the claims were invalid for failing to satisfy the written description requirement under § 112(a).  While the district court granted Gilead’s JMOL on enablement, it denied the motion with respect to written description.  Idenix appealed.

The Majority’s Opinion

The Federal Circuit affirmed the lower court’s decision on enablement but reversed the denial of JMOL on written description.  In explaining its affirmation of the lack of enablement finding, the majority weighed each of the Wands factors that the jury had before it:

(1) the quantity of experimentation necessary;

(2) how routine any necessary experimentation is in the relevant field;

(3) whether the patent discloses specific working examples of the claimed invention;

(4)  the amount of guidance presented in the patent;

(5) the nature and predictability of the field;

(6) the level of ordinary skill; and

(7) the scope of the claimed invention.

In re Wands, 858 F.2d 731, 737 (Fed. Cir. 1988).  The parties themselves had agreed on the high level of ordinary skill and experts from both sides concurred as to the unpredictability of the field.  As such, both of these factors were found to weigh in favor of non-enablement.  As to the quantity of experimentation necessary, the court agreed with the lower court’s finding that excessive experimentation would have been required to determine which 2’-methyl nucleosides would be effective for treating hepatitis C virus.  In addition, the majority explained that the working examples and guidance in the ʼ579 patent merely provided a starting point for further research, but did not go so far as to allow a skilled artisan to know which 2’-methyl nucleosides are or are not effective against hepatitis C virus.  The final factor—scope (overbreadth) of the claims—also weighed in favor of non-enablement.  Thus, weighing each of the factors, the majority concluded as a matter of law that the asserted claims of the ʼ597 patent were invalid for lack of enablement.  In further supporting its decision, the majority likened the facts of this case to those in Wyeth and Cordis Corp. v. Abbott Laboratories, where the claims encompassed millions of compounds, while only a much smaller subset of those compounds would have actually had the functional effect required by the claims.  As here, the court in Wyeth found that having to synthesize and screen each potential compound for effectiveness was undue experimentation.

On the written description issue, the majority held that the ʼ579 patent did not adequately demonstrate that the inventors possessed the full scope of the claimed invention, and certainly not if the scope covered Gilead’s Sovaldi® and Harvoni® drugs.  The majority’s opinion explained that, even though “a nucleotide-by-nucleotide recitation of the entire genus” is not required to find adequate written description, the absence of explicit disclosure in the ʼ597 patent of the particular species found in Gilead’s drugs (2’ methyl up/2’ fluoro down nucleoside), and further absence in the ʼ597 patent of a sufficient number of species to define a genus that includes the species found in Gilead’s drugs, or structure/function relationships that would necessarily include the species found in Gilead’s drugs make it clear that the ʼ597 patent fails to satisfy the written description requirement.  Interestingly, even though its lack of enablement affirmation was partially based on the rationale that the ʼ579 patent was insufficient with its working examples and guidance, the court supported its finding of failure to the written description requirement with reference to “tens or hundreds of thousands of possible nucleosides, substituent-by-substituent, with dozens of distinct stereochemical structures…”

In Judge Newman’s dissent, she sets forth her view that there is no lack of enablement or written description because the claims are limited by what is set forth in the specification, such that interpreting claim scope necessarily restricts the scope to that disclosure.  She also concludes that even though Gilead stipulated to infringement, the proper outcome of the case should be that the asserted claims are valid based on the scope supported by the specification, but not infringed since the species of 2’-methyl nucleosides used in Gilead’s accused drugs were not included in the scope of the asserted claims.  The majority responded that Judge Newman’s preferred outcome on appeal would disregard binding claim construction, ignore the stipulation of infringement by Gilead, and analyze a case not before the court on appeal.  In any event, the majority’s conclusion and the dissenting opinion result in the same outcome for Gilead, i.e., no damages.  The major difference is that the majority’s opinion has eviscerated yet another pharmaceutical patent, whereas the dissent’s view would have preserved the patent while clearing Gilead of infringement.

Federal District Court Finds Claims Directed to Dog Chew Toy Patent EligibleFew subjects have drawn as much interest among patent stakeholders and practitioners as understanding the framework used to determine a patent claim’s eligibility. Courts continue to address different factual situations in applying the two-step test for patent eligibility under 35 USC § 101 that the Supreme Court set out in Alice Corp. Pty. Ltd. V. CLS Bank Int’l., 537 U.S. 208, 217 (2014).Courts generally ask whether a claim is directed to patent eligible subject matter or a patent-ineligible concept, such as an abstract idea or natural phenomenon. If a claim is drawn to a patent ineligible concept, the court asks whether the claim includes an inventive concept or is simply an abstract idea without significantly more.

So, should a court disregard “well-understood, routine, and conventional” components of a claimed device when deciding whether a claim is directed to a patent-ineligible “natural phenomenon” under the first step of the Alice test?

Not according to the United States District Court for the Northern District of Illinois in FYF-JB LLC v. Pet Factory, Inc., which denied a motion to dismiss a patent infringement suit making this argument in the context of claims covering a dog chew toy. In Pet Factory, the accused infringer of U.S. Patent No. 9,681,643 (the “’643 Patent,” entitled “Tug Toy”), Pet Factory, Inc., argued that claims directed to a dog chew toy that makes noise when tugged or stretched were patent ineligible under § 101. Claim 1, which is one of several asserted claims, reads as follows:

  1. A tug toy comprising:

at least one gripping member and a central portion, wherein said at least one gripping member is attached to said central portion, and

wherein said central portion further includes a noise maker,

wherein said at least one gripping member is adapted to transmit force to said central portion and

wherein said force comprises a first lateral force directed away from the central portion in the direction of a first gripping member.

According to Pet Factory, even though the claims of the ‘643 Patent recited tangible chew toy devices, the devices’ components were “well-understood, routine and conventional.” Aside from these tangible components, Pet Factory argued that the claims recite nothing more than the natural phenomenon of “force and its direction” for purposes of Step 1 of the Alice inquiry. As a result, Pet Factory argued the patent infringement complaint against it brought by patent holder FYF-JB LLC should be dismissed.

The court disagreed, pointing out that whether components of a claimed device are “well-understood, routine and conventional” is not relevant to the determination under Step 1 of Alice of whether the claims are directed to a patent-ineligible concept.  The court noted that “the ‘well-understood, routine, and conventional’ language that Pet Factory cites comes from Alice and Mayo in the context of describing under step two of the Alice test why the addition of routine steps does not transform an otherwise unpatentable method into a patent-eligible application.” Because the claims were “anchored in the tangible form of a tug toy,” the court found the claims patent eligible, although it noted that simply reciting “concrete, tangible components is not necessarily enough to escape the reach of Alice step one.” The court apparently found persuasive cases cited by the patent holder which similarly rejected the notion that patents directed to circular swings that could move in any direction simply involved the natural phenomenon of a pendulum, and thus patent ineligible. Similarly, the court found the claims of the ‘643 Patent “involve force but are not directed to force itself.” They “describe the features of the tug toy, and how the apparatus is designed to transmit force and activate the noise maker.”

The court’s interpretation seems to be that tying a natural phenomenon to the operation of a claimed device is different from claiming the phenomenon itself. This decision suggests that whether a claim’s components are commonplace is not likely to be a relevant consideration under the analysis in Step 1 of Alice. Practitioners also should understand whether their claims are directed to the components of a claimed device, which are free to operate according to principles of a natural phenomenon, or simply to the operation of the phenomenon itself.

If you have questions regarding patent eligible subject matter under 35 USC § 101, please contact a member of Bradley’s Intellectual Property Practice Group.

The Risk of Using “Consisting Essentially of” in Patent ClaimsThe legal meaning of the transition language “consisting essentially of” is well-established in Federal Circuit case law and is generally construed to mean that the composition or formulation (a) necessarily includes the listed ingredients and (b) is open to unlisted ingredients that do not materially affect the basic and novel properties of the composition.  Similarly, when “consisting essentially of” is used in a process claim, the claim requires that the listed steps are performed, but also may include unlisted steps that do not affect the basic and material properties of the process. Accordingly, a “consisting essentially of” claim is typically understood to signal a middle ground between a closed claim that is written in a “consisting of” format and, thus, excluding any items not expressly recited in the claim, and an open claim that is written in a “comprising” format such that any unrecited items are not excluded. However, the middle ground just became a little less secure for patent holders with the Federal Circuit’s opinion in HZNP Medicines LLC v. Actavis Laboratories UT, Inc. In a nutshell, the phrase “consisting essentially of” is indefinite if any identified basic and novel property is indefinite.

To provide some quick background, HZNP and Horizon own patents covering PENNSAID® 2% – the first FDA-approved twice daily topical diclofenac sodium formulation for the treatment of the pain of osteoarthritis of the knees (Horizon patents). The Horizon patents include the method of use and formulation claims. Actavis asserted that the generic copy of PENNSAID® 2% described in Actavis’ Abbreviated New Drug Application No. 207238 would not infringe any valid and enforceable Horizon patent. Horizon sued Actavis for patent infringement of the Horizon patents in the District of New Jersey.

During the claim construction (Markman) phase, the district court held that the formulation claims, which feature a topical formulation having a viscosity of 500 to 5,000 centipoise “consisting essentially of” certain ranges of diclofenac sodium, dimethyl sulfoxide, ethanol, propylene glycol, hydroxypropyl cellulose, and water were indefinite. More specifically, while the district court found that the specification sufficiently identified five basic and novel properties of the claimed invention — i.e., (1) better drying time; (2) higher viscosity; (3) increased transdermal flux; (4) greater pharmacokinetic absorption; and (5) favorable stability — it concluded that a person of ordinary skill in the art would not be able to have reasonable certainty about the scope of these properties.

On appeal, Horizon tried to convince the Federal Circuit that the Nautilus definiteness standard does not apply to the basic and novel properties of the invention. As a refresher, under Nautilus, Inc. v. Biosig Instruments, Inc., the Supreme Court determined that a claim is invalid for indefiniteness if its language, read in light of the specification and prosecution history, fails to inform with reasonable certainty those skilled in the art about the scope of the invention. In shooting down this argument, the majority clarified that by using “consisting essentially of” in a claim, an inventor incorporates into the scope of the claims an evaluation of the basic and novel properties. Thus, the Nautilus definiteness standard applies to the basic and novel properties.

Horizon also tried to persuade the Federal Circuit that the basic and novel properties are to be considered only as factual determinations of validity and infringement — not at the claim construction stage. Again, the majority was not swayed and explained that the determination of the basic and novel properties of an invention at the claim construction stage is critical to afford clear notice of what is claimed. If any property does not inform a person of ordinary skill in the art with reasonable certainty about the scope of the invention, then the phrase “consisting essentially of” is indefinite in light of the indefinite scope of that property.

On the other side of the podium, Actavis argued that the five basic and novel properties were not identified in the specification as important enough to even be considered basic and novel properties. The majority’s opinion explains that each of the five properties are included in the specification as separate subheadings with discussions of both the importance of each of the properties and the advantages of the invention over prior art with respect to these properties such that the intrinsic record sufficiently identifies the properties as the basic and novel properties of the invention. Despite the basic and novel properties being readily identifiable from the specification, the majority agreed with the district court that one of the five identified basic and novel properties, i.e., better drying time, was indefinite. More specifically, since the two different tests in the specification produced inconsistent results, the majority concluded that a person of ordinary skill in the art would not understand which test to use to evaluate this property. And, as set forth above, if the basic and novel properties are indefinite, so is the phrase “consisting essentially of.”

In sum, if a person of ordinary skill in the art cannot ascertain the bounds of the basic and novel properties of the invention recited in a “consisting essentially of” claim, the claim is indefinite because there is no basis upon which to analyze whether an unlisted item has a material effect on the basic and novel properties.

So what are the key takeaways from this part of the Horizon decision? First, for patent practitioners, be conscientious when employing “consisting essentially of” language in claims.  While the majority’s opinion made it clear that “consisting essentially of” claims are not per se indefinite, ambiguities in the specification as to the basic and novel properties of the invention or what constitutes a material alteration of these properties certainly leave such claims vulnerable to an indefiniteness attack. Since “consisting essentially of” language is typically introduced during prosecution in an effort to distinguish over a cited reference, ensure that any such amendment to the transition language is thoroughly vetted as if you are in the Markman phase of a patent infringement trial. Even though “consisting of” language is narrower in scope than “consisting essentially of” language, if the specification lacks requisite clarity with regard to the basic and novel properties of the invention, you would be better off obtaining a closed claim than a middle ground claim susceptible to attack under 35 U.S.C. § 112.

Second, for accused infringers wanting to challenge the validity of a “consisting essentially of” claim for failure to clearly identify the basic and novel properties or what constitutes a material alteration of these properties, be prepared to do so early in the dispute and no later than the Markman phase. If the only asserted claims are “consisting essentially of” claims, you may be able to end the dispute altogether well before summary judgment. If the asserted claims are not limited to the “consisting essentially of” claims, you at least may be able to significantly narrow the issues for subsequent phases of the litigation, thus reducing litigation costs, as well as possibly gaining considerable leverage for settlement purposes.