Patent Docs

More on Second Letter to OMB Criticizing the IDS Rule

    By Donald Zuhn --

Yesterday, we reported on a second letter that was sent to the Office of Management and Budget (OMB) criticizing the IDS rules proposed by the U.S. Patent and Trademark Office on July 10, 2006 (see "Changes to Information Disclosure Statement Requirements and Other Related Matters," 71 Fed. Reg. 38,808).  The letter was prepared by Dr. Richard Belzer on behalf of clients he declined to identify, and accompanying Dr. Belzer's letter was a 21-page Declaration from a unidentified registered patent attorney having over 20 years of experience in the field of intellectual property.  The Declarant estimates that the cost of complying with the proposed IDS Rule will be between $7.3 and $7.9 billion per year.

In addition to this cost of compliance estimate, the Declarant provides a number of other interesting "observations."  For example, the Declarant presents a significantly different picture regarding the percentage of applications that would be impacted by the proposed IDS rule.  While the Patent Office analyzed allowed applications over an unidentified six-week period of time and then concluded that 15% of all patent applications would be affected by the "more than 20 reference" provision of the IDS rule, the Declarant analyzed a random sample of 25 patents selected from the 2,896 patents that issued during the week of the report and found that 44% contained citations to more than 20 references.  As a result of this discrepancy, the Declarant urges the OMB "to examine the PTO data supporting the comment in the rule proposal very carefully, including checking its methodology for possible bias."

The percentage of affected applications rises even higher when the "+25 page/foreign-language reference" provision of the IDS rule is considered.  Among the 25 patents from the Declarant's random sample, only three of the fourteen patents that were not impacted by the "more than 20 reference" provision were also not impacted by the "+25 page/foreign-language reference" provision.  Thus, 85% of the 25 patents from the Declarant's random sample would have been required to comply with one of these two provisions (a far cry from the Patent Office's estimate that only 15% of all patent applications will be impacted).

Moreover, the Delcarant suggests that when faced with the consequences of performing a search (i.e., complying with the above provisions):

some practitioners might respond . . . by adopting a "head in the sand" approach and failing to search for or find possibly pertinent references, to avoid the risk of filing reports of this nature.  To the extent that this occurs, there would be extra costs [for the proposed IDS rules] as well.  Such costs include the extra cost arising from the examiners needing to search for references without applicant searches, extra costs to the public from some patents issuing unjustifiably because less searching was done, and extra costs on applicants arising from unprotected inventions (temporarily or permanently) or wasted application fees because applications were written without adequate investigation of prior art to focus them on the true inventive aspects.

In opining on the Patent Office's "Certification Analysis Under the Regulatory Flexibility Act" of June 29, 2007, which relates to cost estimates for the preparation of Examination Support Documents (ESDs), the Declarant "consider[s] that report's quality as easily falling within the term 'junk science' (to the extent that the report qualifies for use of the term 'science' at all)."  [The Declarant offers an analysis of the ESD cost estimate because the Patent Office failed to provide a cost estimate for the preparation of Patentability Justification Documents (PJDs) under the proposed IDS rule.]  In addition, the Declarant notes (not surprisingly) that:

[t]he PTO's consultant who sought to estimate practitioner costs for ESDs did not report speaking with or gathering information from any practitioners, much less taking any valid and reliable sample of practitioners who have studied the nature of the tasks they would be required to perform under the proposed IDS rule.

According to the Declarant, the Patent Office's flawed methodology does not end with its failure to consult with patent practitioners and applicants.  In fact, the Declarant points out numerous instances in which the Office failed to present or identify data or information that the Declarant deems necessary to a proper analysis of the proposed IDS rule's impact, including the Office's failure to:

• identify the dates of the allowed applications in its six-week study (see above);
• report the average number of independent or total claims found in the 15% of applications in its sample in which applicants cited more than 20 references;
• report the average number of dependent claims in applications;
• produce actual data on the number of applications that are amended and the percentage of patents that are the subject of litigation;
• determine the amount of time examiners expend reviewing large IDS's;
• estimate the fraction of references cited that exceed 25 pages and the fraction of references cited that are in a foreign language;
• determine the percentage of foreign-language references submitted in IDS statements that have been translated in full;
• provide data as to how often references are cited after a first Office action;
• provide the amount of revenue the Office collects for the filing of late IDS's.

With respect to the impact of the IDS rule on allegations of inequitable conduct (a topic on which the Declaration provides a thorough analysis), the Declarant states that:

based on my experience with inequitable-conduct litigation, it is my opinion that, for those applications that result in patents that are litigated, inequitable conduct would be alleged in essentially 100% of cases in which a "patentability justification" document was filed.  This is perhaps the easiest estimate that I have made in this declaration.

Finally, in summarizing the impact of the proposed IDS rules, the Declarant concludes that:

[t]his is a particularly cumbersome set of rules that the public is being asked to follow.  The paperwork requirements are extreme and quite expensive.  The PTO's entire strategy is flawed, because (a) it seeks to shift duties from the examiners, who can perform such duties cheaply and without paperwork, to applicants, who are positioned to perform such duties more expensively and who must submit the paperwork only in the most careful fashion, and (b) it places applicants and practitioners in a "Catch-22" situation by, under an existing rule, mandating disclosure of material, known prior art references, while simultaneously, under the proposed new rule, mandating high extra cost and grave risks in instances where there is a duty to disclose many references or references that are relatively lengthy or written other than in English.

GSK Brings Out the Big Guns Opposing the New Continuation and Claims Rules

    By Kevin E. Noonan --

As reported recently by Patent Docs (see "Hooray! - (Finally) the Big Dogs Have Joined the Hunt"), GlaxoSmithKline (GSK) filed suit on October 9th in the U.S. District Court for the Eastern District of Virginia against John Dudas and the U.S. Patent and Trademark Office, asking for preliminary and permanent injunctions staying implementation of the PTO's new continuation and claims rules entitled "Changes to Practice for Continued Examination Filings, Patent Applications Containing Patentably-indistinct Claims and Examination of Claims in Patent Applications; Final Rule" (New Rules).  A hearing is set for October 31st (the delay being the result of the Patent Office's request, perhaps hoping the judge wouldn't be willing to stay implementation of the New Rules at the 11th hour).  GSK is asking for a stay in implementation of the New Rules and a permanent injunction enjoining Defendants from issuing new regulations relating to the number of continuations, requests for continuing examination (RCEs), or claims permitted in an application, and to vacate the New Rules and declare them arbitrary, capricious, an abuse of agency discretion, contrary to law, constitutional right, power privilege or immunity, and in excess of the Office's statutory authority.

GSK has filed a declaration from none other than Harry F. Manbeck, Jr. (at left), former Patent Office Commissioner under President George H.W. Bush and now a member of the Rothwell Figg firm in Washington, D.C.  In addition to his government service, Mr. Manbeck served as general patent counsel to the General Electric Company, which enhances the credibility of his testimony regarding the New Rules.  The Patent Office has filed a motion to strike this declaration, which will come as no surprise once the declaration has been read and appreciated.

Mr. Manbeck makes a number of relevant assertions (under penalty of perjury) in his declaration.  First, he testifies that the Patent Office has only limited (non-substantive) rulemaking authority, specifically precluding the Office from interpreting the Patent Act.  He cites Federal Circuit authority (including Merck & Co. v. Kessler, 80 F.3d 1543 (Fed. Cir. 1996) for the proposition that the statute (35 U.S.C. § 2(b)(2)(A) - previously 35 U.S.C. § 6(a) - authorizes the Office to make rules "directed only to the conduct of proceedings in the PTO; it does NOT grant the Commissioner the authority to issue substantive rules."  Id. at 1549-50  (emphasis in original); accord, Eli Lilly & Co. v. Board of Regents of the Univ. of Washington, 334 F.3d 1264, 1269 n.1 (Fed. Cir. 2003).  He frankly disputes the assertion that Congress expanded the PTO's rulemaking authority when the statute was amended in 2000 and codified as 35 U.S.C. § 2(b)(2)(A); he cites unsuccessful Congressional efforts on two occasions since the 2000 amendments to grant expanded rulemaking power to the PTO, as well as the provisions of H.R. 1908 (see "Patent 'Reform' Bill Passes House of Representatives") that do grant such powers to the Office, as evidence that Congress did not intend to give such power to the PTO by the 2000 amendments.  He also notes that the provisions of the House bill give Congress the ability to reverse any such action by the Office within 60 days, as well as the absence of provisions for expanding the PTO's rulemaking authority in the Senate version of the bill (which he notes has not been passed).

Mr. Manbeck also provides the Court with a brief synopsis of the history of continuation practice (a wise undertaking in view of the judiciary's relative lack of experience with the minutiae of Patent Office regulations), as well as the case law supporting unfettered continuation application filings.  In this he affirms many of the allegations contained in GSK's complaint relating to the importance of continuations in protecting innovation and the statutory provisions ensuring the availability of continuation application practice.  In particular, Mr. Manbeck disputes any claim that the amendments to 35 U.S.C. § 120 made as part of the American Inventors Protection Act in 2000 gave the Director (formerly Commissioner) any power to substantively limit applicant access to continuation applications.  Mr. Manbeck also discusses claiming under 35 U.S.C. § 112, second paragraph, and request for continuing examination practice under 35 U.S.C. § 132.  He also debunks the idea that the New Rules are intended to address the problem of "submarine patents," made largely obsolete in view of the changes in patent term enacted as part of U.S. implementing law related to accession to the GATT treaty.

Turning to the heart of the matter, Mr. Manbeck sets forth the following reasons why an applicant would file a continuation application:

• To differentiate claims over art cited in prosecution;
• To present evidence of unexpected advantages (that may not have been available beforehand);
• To add new claims directed to aspects of an invention disclosed but not earlier claimed;
• To disclose newly-discovered prior art (particularly art contained in a search report produced by a foreign patent office or in an international application).

Moreover, Mr. Manbeck cites Patent Office statements that the following reasons would not satisfy the "sufficient reason" standard for the petition and showing option "offered" by the Office:

• Attempts to submit newly-discovered prior art (citing Response to Comment 85);
• An unusual interpretation of the claims by an examiner only belatedly understood by the applicant;
• Applicant's recent discovery of a commercially-viable product, or financial resources, or a competing product;
• Significant applicant disability.

In making these statements, Mr. Manbeck reminded the Court that the Federal Circuit has expressly prohibited the Office from denying an applicant's right to file a continuing application absent evidence of abusive and repetitive practices.  Symbol Technologies, Inc. v. Lemelson Med., Educ. And Research Found., 422 F.3d 1378 (Fed. Cir. 2005); it is clear that the prohibitions on continuation filings contained in the New Rules address far more instances than prosecution laches as held by the Court.

Mr. Manbeck also addresses the aspects of the New Rules that are to be applied retroactively for both continuations and claim numbers and that they create an ethical conundrum for practitioners to the detriment of their clients based on the "physical impossibility" interpretation the Office has placed on the "could not have earlier" requirement for a showing sufficient to obtain an additional continuation or RCE.  (This tracks the allegations in GSK's complaint.)  He particularly points out the deficiencies of the Examination Support Document rule (37 C.F.R. § 1.265) including allegations of vagueness and failure to inform applicants on how to comply with the rule (also aspects of GSK's allegations in its complaint).

Mr. Manbeck concludes that "it is my opinion that the Director and the PTO have exceeded their statutory authority in promulgating the [New] Rules, that the [New] Rules exceed the plain language of the Patent Act, and that the [New] Rules' ESD requirement hopelessly lacks guidance.

It will be interesting to see how the Office attempts to rebut Mr. Manbeck's informed opinion.

OMB Receives Second Letter Criticizing Proposed IDS Rule

    By Donald Zuhn --

Last week, we reported on a letter that David Boundy, the Vice President of Intellectual Property for Cantor Fitzgerald L.P., sent to the Office of Management and Budget (OMB) on behalf of twenty-five companies and organizations, criticizing the IDS rules proposed by the U.S. Patent and Trademark Office on July 10, 2006 (see "Changes to Information Disclosure Statement Requirements and Other Related Matters," 71 Fed. Reg. 38,808).  Yesterday, Mr. Boundy alerted Patent Docs to a second letter that has been sent to the OMB challenging the proposed IDS Rule.

The second letter was prepared by Dr. Richard Belzer on behalf of clients he declined to identify.  In explaining the need for confidentiality, Dr. Belzer writes that "[my clients] have persuaded me that there is a reasonable expectation that revealing their identities could result in financially devastating retaliation with respect to patent applications now in process or which they would submit to USPTO in the future."

Accompanying Dr. Belzer's 11-page letter is a 21-page Declaration from a registered patent attorney having over 20 years of experience in the field of intellectual property and the unedited comments of "four experienced patent attorneys with skills across multiple practice areas" who reviewed the Declaration.  Although the affiant was willing to be identified, Dr. Belzer states that "to ensure that the affiant has the same protection from retaliation that my clients reasonably fear, I have redacted all personally identifiable information from the declaration."

Based on the affiant's estimate that the cost of complying with the proposed IDS Rule will be between $7.3 and $7.9 billion per year, Dr. Belzer concludes that the IDS rule would have an "economically significant" effect.  [Patent Docs readers are reminded that Mr. Boundy's letter included an estimate from San Luis Obispo, CA patent attorney Philip Steiner that the cost of complying with the proposed IDS Rule would be $1.9 billion.]

With respect to the impact of the proposed IDS rule, Dr. Belzer begins by stating that:

[b]ased on my expertise in regulatory analysis, and more than 20 years' experience reviewing such analyses (including 10 while employed as an economist at OMB), I am virtually certain that the proposed IDS Rule is economically significant and thus warranted the preparation of an RIA [Regulatory Impact Analysis] in accordance with the guidelines set forth in OMB Circular A-4.

Dr. Belzer then adds that "based on my governmental experience it is inconceivable that USPTO could be unaware of the approximate magnitude of these costs, or that it employed any reasonable economic method or logic to determine that the proposed rule was 'not significant,'" and that "[o]ne can infer with reasonable certainty that USPTO deliberately evaded the requirements of Executive Order 12,866 [which mandated that the Patent Office perform an RIA]" (emphasis added).  Dr. Belzer continues his harsh criticism of the Patent Office's efforts to gain OMB approval for the proposed IDS rule by noting that the:

USPTO is required, pursuant to OMB's and is own information quality guidelines, to adhere to the principles of substantive and presentational objectivity in the dissemination of influential information.  The proposed IDS Rule was covered by these guidelines, but USPTO did not disclose any credible information about its cost.  This is per se a violation of both substantive and presentational objectivity.  The agency could not reasonably have believed that the costs of the proposed IDS Rule were trivial and thus not worth mentioning, and its failure to disclose an unbiased cost estimate was knowingly misleading.

Determining that the Patent Office has failed to credibly estimate the costs of complying with the proposed IDS Rule, Dr. Belzer concludes his letter by offering to assist the Patent Office and the OMB in the development of credible burden estimates for the proposed IDS rule.

Bioenvision Shareholders Approve of Genzyme Acquisition

    By Sherri Oslick --

Genzyme Corporation of Cambridge, MA has announced that Bioenvision, Inc. (New York, NY) stockholders approved the acquisition of the company by Genzyme for roughly $345 million in cash.  The acquisition suffered from a number of bumps in the road, starting with disapproval of the deal by a key stockholder who raised issue with the fact that Genzyme's proposed takeover followed closely behind a share value dilution used to pay for new clinical trials, believing that Genzyme's offer undervalued the company.  In the end, Genzyme and Bioenvision had to seek court approval to reopen the original stockholders' vote on the acquisition in order to ensure that all stockholders had the opportunity to vote.  The acquisition will be effective on Wednesday, October 24.

Bioenvision is a biopharmaceutical company focused on compounds for the treatment of cancer, autoimmune disease, and infection.  Included in Bioenvision's pipeline is clofarabine, a purine nucleoside analog cancer therapeutic.  Genzyme initially retained the rights to clofarabine in an exclusive sublicense from Bioenvision.  Marketed as Clorar® in the U.S. and Canada, clofarabine was approved by the FDA in December, 2004 for the treatment of relapsed and refractory pediatric patients with acute lymphoblastic leukemia (ALL).  The FDA also granted orphan drug status to clofarabine as well as an additional six month pediatric exclusivity for clofarabine in pediatric ALL.

Bioenvision's product portfolio also includes, among others, Modrenal® (trilostane), a selective steroid receptor marketed in the U.K. for the treatment of post-menopausal advanced breast cancer following relapse to initial hormone therapy, and Suvus® (methylene blue), which yielded positive results in the treatment of hepatitis C viral infection in Phase II trials.  Bioenvision's patent portfolio includes at least three published patent applications directed to its methylene blue therapeutic.

For more information, please see:

• Genzyme press release

A Call to Arms

    By Kevin E. Noonan --

Resistance to the U.S. Patent and Trademark Office's new continuation and claims rules continues to grow (although how effective that resistance will be less than two weeks before the rules are implemented is a problematic question).  The latest salvo comes from the Practising Law Institute's Patent Blog, in the form of back-to-back posts by Gene Quinn (see "A Call to Action Against the Patent Office") and John White (see "Time to Get Involved & Stop the USPTO").

Mr. Quinn's (at left) post speaks frankly of "revolution" and a "call to action."  Lawsuits are recommended as the implement of choice in this fray, and in particular the lawsuit filed by GlaxoSmithKline in the Eastern District of Virginia last week (see "Horray! - (Finally) the Big Dogs Have Joined the Hunt").  Mr. Quinn agrees that pharma will be the hardest hit by the rules, but thinks that all high-tech patenting should be included in the list of technologies put at risk by the rules, including software.

Mr. Quinn points out that the Patent Office has asked the Court to wait until the night before the implementation deadline (fittingly, Halloween) to hear GSK's motion for a TRO and preliminary injunction, clearly hoping that the Court will not be able to respond "on the spot" and, of course, then setting up its next argument that the new rules are a fait accompli and that granting GSK's motion would prejudice those applicants who have already complied with the rules.

Mr. Quinn doesn't think filing separate lawsuits will be effective (in the short term, at least), but he does think that others can help the Court understand the gravity of the situation and the equities involved in granting the preliminary injunction motion until the Court can consider the issues on the merits.  He suggests that interested parties - everyone from individual inventors, small businesses, small cap, large cap, or Fortune 500 companies - should file amicus briefs with the Court to explain how the rules will negatively impact them.  The idea is for the Court to recognize that this isn't just one company disagreeing with the Patent Office, but that GSK's suit represents a large, even overwhelming, proportion of those entities most interested and invested in patents and patenting.

Recognizing that some groups may not have the time or the wherewithal to effectively mount such as effort - and cautioning against a letter-writing campaign to the Court that may backfire - Mr. Quinn suggests that anyone having any arguments or evidence against the new rules send them to him at: gquinn@ipwatchdog.com.  He asks for specifics, preferably with citations to relevant case law, statutes or the rules, and in any event, complete arguments rather than rants.  Mr. Quinn  proposes to use his blog to publicly vet the arguments and to make them available to others.  Anonymity is offered but not required  - after all, who (or what lawyer, at least) wouldn't want to take credit for the argument that persuades the Court to rule in "our" favor?

Mr. White (at left) is kinder in some ways to the current Patent Office administration, positing that the negative effects of the new rules are merely unintended consequences.  (As readers of Patent Docs will recognize, we feel that view is naïve - the Office cares about nothing other than reducing the backlog, and will do whatever it takes to do so.)  He recognizes that the comments provided to the Office merely "softened the blow" of the new rules (and as hard as it may be to comprehend, the rules as originally proposed were even worse than the rules as promulgated this August).  Like Mr. Quinn, Mr. White believes it's time to "rally the troops" and "grab the pitchforks" (whether analogizing the Patent Office with Frankenstein or Dracula is not specified).  His reasoning is the same as Mr. Quinn's:  not much time, and irrevocable loss of property rights.

Both authors correctly state the widespread beliefs of the vast majority of the patent bar (absent a few litigators who are willing to gut the patent system to kiss up to their patent-infringing clients):  the new rules are an illegal grab of executive power without consideration to the limitations of the enabling statute, done with scant factual support and supported by specious arguments (sound familiar?).  No one disputes that 20 years of Patent Office underfunding during an era of exponentially-increasing innovation (anyone at the PTO ever heard of Moore's Law?) has left the Office with a crushing backlog, but what is misunderstood (or misrepresented) is that this represents innovation, and the new rules are willing to force applicants to abandon protection for that innovation to satisfy merely bureaucratic goals.  Don't be surprised if one-quarter to one-third of the Patent Office backlog of applications are abandoned in the next twelve months (which is precisely what the new rules are intended to encourage if not force applicants to do).  And don't be surprised if we start feeling the consequences in the next few years.  Let's hope some of that abandoned innovation doesn't relate to new drugs that Americans will need as a large bolus of us get to the age where we wish we had all the pharmaceutical help we can get.  The Patent Office will be content with reducing its backlog on the backs of those with such needs.

Court Report

    By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases, and a few interesting cases will be selected for periodic monitoring.

Sepracor Inc. et al. v. Dr. Reddy's Laboratories, Ltd. et al.
3:07-cv-05001; filed October 17, 2007 in the District Court of New Jersey

Infringement of U.S. Patent Nos. 7,214,683 ("Compositions of Descarboethoxyloratadine," issued May 8, 2007) and 7,214,684 ("Methods for the Treatment of Allergic Rhinitis," issued May 8, 2007), licensed to Schering-Plough, following a paragraph IV certification as part of Dr. Reddy's filing of an ANDA to manufacture a generic version of Schering-Plough's Clarinex® (desloratidine, used to treat allergies).  View the complaint here.

Teva Pharmaceutical Industries Ltd. et al. v. Zydus Pharmaceuticals, Inc. et al.
3:07-cv-04942; filed October 12, 2007 in the District Court of New Jersey

Infringement of U.S. Patent Nos. 6,699,997 ("Carvedilol," issued March 2, 2004), 6,710,184 ("Crystalline Solids of Carvedilol and Processes for Their Preparation," issued March 23, 2004), 7,056,942 ("Carvedilol," issued June 6, 2006), and 7,126,008 (same title, issued October 24, 2006) based on Zydus' filing of an ANDA to manufacture and sell a generic version of GSK's Coreg® (carvedilol, used to treat congestive heart failure).  View the complaint here.

Acorda Therapeutics, Inc. v. Apotex Inc. et al.
2:07-cv-04937; filed October 11, 2007 in the District Court of New Jersey

Infringement of U.S. Patent No. 6,455,557 ("Method of Reducing Somnolence in Patients Treated with Tizanidine," issued September 24, 2002) following a paragraph IV certification as part of Apotex's filing of an ANDA to manufacture a generic version of Acorda's Zanaflex Capsules (tizanidine hydrochloride capsules, used for the management of spasticity).  View the complaint here.

Novartis Corporation et al. v. Mylan Laboratories Inc. et al.
2:07-cv-04918; filed October 11, 2007 in the District Court of New Jersey

Infringement of U.S. Patent No. 6,162,802 ("Synergistic Combination Therapy Using Benazepril and Amlodipine for the Treatment of Cardiovascular Disorders and Compositions Therefor," issued December 19, 2000) following a paragraph IV certification as part of Mylan's filing of an ANDA to manufacture a generic version of Novartis' Lotrel® (amlodipine besylate/benazepril hydrochloride, used to treat hypertension).  View the complaint here.

Court Report

    By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases, and a few interesting cases will be selected for periodic monitoring.

Cobalt Pharmaceuticals Inc. et al. v. Bayer Aktiengesellschaft et al.
1:07-cv-05875; filed October 17, 2007 in the Northern District of Illinois

Declaratory judgment of non-infringement, invalidity, and preclusion of delisting of U.S. Patent No. 4,904,769 ("Highly Pure Acarbose," issued February 27, 1990) in conjunction with Cobalt's filing of an ANDA to manufacture a generic version of Bayer's Precose® (acarbose, used to treat hyperglycemia in patients with Type-II diabetes).  View the complaint here.

Monsanto Company et al. v. Bowman
2:07-cv-00283; filed October 15, 2007 in the Southern District of Indiana

Infringement of U.S. Patent Nos. 5,352,605 ("Chimeric Genes for Transforming Plant Cells Using Viral Promoters," issued October 4, 1994) and RE39,247 ("Glyphosate-tolerant 5-enolpyruvylshikimate-3-phosphate Synthases," issued August 22, 2006) based on defendant's use of soybean seed produced from earlier planted Roundup Ready® soybean seed.  View the complaint here.

Sanofi-Aventis et al. v. Aurobindo Pharma Ltd. et al.
1:07-cv-05807; filed October 12, 2007 in the Northern District of Illinois

Sanofi-Aventis et al. v. Sun Pharmaceutical Industries, Incorporated et al.
2:07-cv-14355; filed October 12, 2007 in the Eastern District of Michigan

The complaints in these cases are substantially identical.  Infringement of U.S. Patent Nos. 4,661,491 ("Alfuzosine Compositions and Use," issued April 28, 1987) and 6,149,940 ("Tablet with Controlled Release of Alfuzosine Chlorhydrate," issued November 21, 2000) following a paragraph IV certification as part of defendants' filing of an ANDA to manufacture a generic version of Sanofi-Aventis' Uroxatral® (alfuzosin hydrochloride, used to treat benign prostatic hyperplasia).  View the Aurobindo complaint here.

NOTE TO OUR READERS:  Due to an outage in the case management system for the District Court of New Jersey, Court Report will be presented in two parts this week.  Newly filed cases in the District Court of New Jersey will be presented tomorrow.  Patent Docs apologizes for the inconvenience. 

Genentech Acts to Halt Off-label Use of Avastin® for Age-related Macular Degeneration

    By Kevin E. Noonan --

Earlier this year, Patent Docs had several posts relating to the use of an anticancer drug, Avastin® (bevacizumab, a monoclonal antibody), for treating neovascular or "wet" age-related macular degeneration (AMD), a condition that if untreated leads inexorably to blindness (see links below).  This is an off-label use; another drug, Lucentis® (ranibizumab injection), has been approved for AMD treatment.  This was not good news for the manufacturer of both drugs, Genentech, because the cost of Avastin® treatment is between 1% and 3% of the cost of Lucentis® treatment ($20-60 per dose versus $2,000/dose).  In addition, the drug is not a cure for AMD but merely stablizes the wet form, and in many patients prevents the condition from worsening.  This means that the drug must be administered like insulin or other maintenance drugs, at a cost of $2,000/dose and a once-a-month dosing schedule.  Avastin® is so much cheaper because it is priced at $600/vial for intravenous use, but is injected into the eye at such small doses (0.1cc) that each vial can deliver 30 doses ($20/dose).  Not surprisingly, Genentech has opposed the off-label use of Avastin®.

Spurred by complaints from ophthalmologists, the National Eye Institute (NEI) planned a comparative study of the two drugs to determine whether there were any advantages of using the drug approved for AMD treatment, Lucentis®, instead of Avastin®.  This study has suffered, however, from a lack of cooperation from Genentech.

On Friday, Genentech raised the stakes.  The way the two drugs are sold (their formulations and concentrations of the API) require Avastin® to be prepared by compounding pharmacies that are capable of reformulating the drug to the more dilute concentrations supplied in Lucentis®.  In a letter from Susan Desmond-Hellmann, President, Product Development that was sent to members of the retinal community, Genentech stated that it "will no longer allow compounding pharmacies to purchase Avastin® directly from drug wholesalers" as of November 30, 2007.  The purported reasons for the ban include the availability of Lucentis®, FDA concerns over sterility and packaging of the reformulated Avastin®, and concerns that Avastin® had not been "designed, manufactured or approved" for the off-label use.

The retinal community has responded, negatively.  The American Society of Retinal Specialists (ASRS) sent their members a letter concerning the ban.  In the letter, the group states that they have contacted Genentech to protest the decision and to voice their opposition to the ban.  They state that they are:

actively investigating the legality, cost, and ramifications of options open to its membership to keep Avastin® available to our patients.  This includes efforts in conjunction with the American Association of Ophthalmologists and other groups.  Physicians are reminded that, for now, Avastin® remains available, and will remain available from hospital pharmacies even after the ban is put into place.  In addition, the NEI study will not be affected by the ban.

Dr. Edward Chaum (at left), Plough Foundation Professor of Ophthalmology, University of Tennessee, informs Patent Docs that the ASRS is actively engaged in the issue, addressing Genentech directly, as well as the FDA and Congress.  Specifically, in a letter to their members the Society asserted that it had contacted "the AAO [American Association of Ophthalmologists], the FDA, Genentech, congressional representatives, the compounding pharmacy industry, and legal counsel."  The Society provides the following response from the FDA on the purported regulatory basis for the ban (emphasis in original):

Subject: FDA statement on Avastin

    Unlike Lucentis (ranibizumab for injection), Avastin (bevacizumab) is not approved for ophthalmic use.  However, the Food and Drug Administration (FDA) did not ask Genentech to stop distributing Avastin to compounding pharmacies and FDA has not taken action to limit the off-label use of Avastin.  FDA has discussed with Genentech developing Avastin for the treatment of macular degeneration and studying its use in ocular indications.  Further, FDA continues to monitor adverse reaction reports related to this off-label use.  To date, the adverse reactions reported to FDA following use of Avastin for ocular indications have been consistent with the adverse reactions reported for Lucentis.  FDA notes that Avastin is a sterile product and that its off-label use for ophthalmic diseases sometimes involves repackaging Avastin into multiple smaller doses for administration.  The agency is concerned about the manipulation of sterile products because of the increased risk of product contamination.

Christopher C. Kelly
Office of Public Affairs
Food and Drug Administration

The Society also provided this insight on Genentech's legitimate concerns for its product:

Senior Genentech leadership described for the first time the actual circumstances of the FDA inspection of one of their oncology plants.  In this inspection, the inspector reportedly looked at the particulates in the IV Avastin lots and specifically noted that these were too high for ophthalmic use.  The contracts with compounding pharmacies were specifically asked for and reviewed, with verbal warnings about promotion of off-label use of the drug.  As a consequence of this inspection, Genentech had to destroy four lots of Avastin.

The Society's letter goes on to say that formulating pharmacies have sufficient stockpiles of Avastin® on hand to supply current patient needs through the spring and possibly into next summer, and that various other avenues are being explored (including individual ophthalmologists reformulating Avastin® in their offices).  The letter ends with the threat that "[w]e have also started to explore the legalities of numerous possible sanctions of Genentech by our society and its membership in the event of corporate non-response."

Dr. Chaum also provided Patent Docs with the following research results:

Early results show Avastin superior to PDT (photodynamic therapy) for wet AMD
This randomized, prospective controlled case series compared these two treatments in patients with predominantly classic CNV.  At 6 months, mean BCVA and greatest linear dimension were significantly better in the Avastin group.  CNV was dry in 81.3 percent of Avastin-treated eyes after the first or second injection (mean 1.6 injections).  The benefit seemed to last for a mean of 3.2 months.  Archives of Ophthalmology, October 2007

Early results show Avastin can reduce diabetic macular edema in some eyes
This randomized, phase II clinical trial finds that 43 percent of Avastin-treated eyes showed an initial positive response (more than 11 percent reduction in central subfield thickness) at three weeks compared with 28 percent of patients treated with focal photocoagulation.  The effect appeared to plateau or decrease in most eyes between the 3- and 6-week visits.  And the magnitude of response was not large for most subjects.  Ophthalmology, October 2007

And on Friday, Senator Herb Kohl (D-WI) (at right), Chairman of the Senate Special Committee on Aging, sent a letter to acting administrator of the Centers for Medicare and Medicaid Services (CMS) for information about the agency's expenditures on Lucentis® and Avastin® in recent years, prompted by Genentech's decision banning sales of Avastin® to formulating pharmacies.  The Senator also asked for any information about what CMS has done to try to reduce costs by using alternatives to Lucentis®, i.e., Avastin®.

Genentech's actions have not endeared the company to the retinal community, according to Dr. Chaum.  After all, Genentech is hardly a struggling biotech start-up any longer:  its third-quarter profit was up almost 21 percent from a year ago, it had a net profit of $685 million, and revenue of $2.91 billion.  Avastin® had $597 million in third-quarter sales, and Lucentis® sales for the quarter were $198 million, a 29 percent increase.  Although its actions with respect to Avastin® and Lucentis® are both perfectly legal and within the regulatory framework for drug approval, the cost differential puts the poor, sick, and aged at risk for permanent blindness.  Whatever the economic justifications proffered by Genentech, they cannot but fall on deaf ears under these circumstances.

For additional information on this topic, please see:

• "Genentech CEO Defends Differential Cost for Avastin®/Lucentis® Treatment of Macular Degeneration," June 6, 2007
• "Retinal Specialist on the Avastin®/Lucentis® Controversy," February 23, 2007
• "Lower Doses of Genentech's Avastin® Effective in Treating Lung Cancer," February 23, 2007

Conference & CLE Calendar

October 24, 2007 - "Sweeping USPTO Patent Rule Changes for Continuations and Claims: Strategies to Meet the New Obligations under the Complex Rules" (Strafford CLE Teleconferences)

October 25-26, 2007 - Biotech and Pharma Public-Private Partnerships Forum (American Conference Institute) - Washington, D.C.***

October 25-27, 2007 - Biotechnology: Patent Prosecution, Licensing, Litigation & Hatch-Waxman (Patent Resources Group) - Palm Springs, CA

November 12-14, 2007 - "Biotechnology for the Non-Biotechnologist" (Management Forum)

November 13-15, 2007 - Pharma and Biotech Collaborative Agreements (American Conference Institute) - New York, NY***

January 30-February 1, 2008 - Pharma/Biotech IP Due Diligence (American Conference Institute) - New York, NY***

***Patent Docs is a media sponsor of this conference or CLE.

SparkIP Launches Online IP Exchange

    By Donald Zuhn --

On Monday, SparkIP launched a beta version of its new online intellectual property exchange, SparkIP.com.  The site, which SparkIP describes as "an advanced research and commerce platform for the scientific community," is designed to connect scientists, inventors, licensors, licensees, corporations, universities, government labs, and patent attorneys with one another; allow for the identification of new collaboration opportunities; and permit IP holders to "market new technologies to a worldwide audience of corporations, entrepreneurs and other acquirers of new technologies."  According to a statement released by the company, the online tool accomplishes this by categorizing information into SparkClusters -- self-organizing and self-naming groups of patents and new inventions, which are designed to reorganize to reflect future technological change.  SparkIP CEO Ed Trimble said that the site would "allow universities, government labs, corporations or anyone with licensable IP to publish their inventions to a global audience," and as a result, would "help to increase the pace of innovation around the world."  Among those agreeing to list their technologies on the site are Duke University, Georgia Tech, North Carolina State, and EPFL of Switzerland.

Management Forum to Hold Biotechnology Conference

Management Forum will be holding a conference entitled "Biotechnology for the Non-Biotechnologist" on November 12-14, 2007 in Miami, FL.  The purpose of the conference is to provide non-biotechnologists with a basic understanding of the principles, techniques, and potentials of biotechnology.  Conference speakers include Carol Kirchhoff, Senior Principal Scientist at Pfizer Inc.; Dr. Dennis Kraichely, Principal Research Scientist at Centocor R&D Inc.; Kim Keyser, Associate Director Regulatory at Lonza Biologics Inc.; Jeffrey Robinson, Senior Scientist at Lonza Biologics Inc.; Dr. Jon Smith, Associate Director R&D Projects at sanofi pasteur; and Patent Docs author Dr. Kevin Noonan.  The conference will cover the following topics:

• Introduction to Biotechnology
• Introduction to Molecular Biology
• Re-Expression of Proteins
• Development of Production Organisms
• Fermentation Technology and Large Scale Production
• Process Optimization and Scale-Up
• Analysis of Biopharmaceuticals
• Product Recovery and Purification
• Formulation Design of Biopharmaceuticals
• Process Economics
• Patenting of Biotech Inventions
• Patent Workshop
• Regulatory Considerations
• Regulatory Applications and Consequences, Comparability and Equivalence
• Current and Future Developments

A complete brochure for this conference, including an agenda, list of speakers, and registration form can be downloaded here.  The registration fee for this conference is $3,300.  Those interested in registering for the conference can do so here or by e-mailing registrations@management-forum.co.uk.

Cantor Fitzgerald VP Criticizes IDS Rule in Letter to OMB

    By Donald Zuhn --

Earlier today, David Boundy, the Vice President of Intellectual Property for Cantor Fitzgerald L.P., provided Patent Docs (and other members of the patent law blogging community) with a copy of a letter he sent to Susan Dudley of the Office of Information and Regulatory Affairs of the Office of Management and Budget (OMB).  The letter, which criticizes the IDS rules proposed by the U.S. Patent and Trademark Office on July 10, 2006 (see "Changes to Information Disclosure Statement Requirements and Other Related Matters," 71 Fed. Reg. 38,808), was sent on behalf of twenty-five companies and organizations, including Amylin Pharmaceuticals, Beckman Coulter, BD, California Healthcare Institute, Mendel Biotechnology, Metabasis Therapeutics, Novo Nordisk, The Scripps Research Institute, Wyeth, and ZymoGenetics.

In the letter, Mr. Boundy concludes that "the proposed IDS Rule has no merit whatsoever, and it would cost patent applicants billions of dollars each year just to comply with onerous new paperwork burdens."  As a result, Mr. Boundy requests that the OMB "put an end to USPTO's flagrant disregard for proper procedure and the exorbitant costs it imposes on its customers, and return this draft rule to USPTO for further consideration."

As with the new continuation and claims rules, Mr. Boundy accuses the Patent Office of "again misrepresent[ing] to OMB the breadth and depth of the effects likely to result," arguing that the proposed IDS rule "will impose billions of dollars of burden on patent applicants and owners."  To support this cost estimate, Mr. Boundy provides a letter from San Luis Obispo, CA patent attorney Philip Steiner, who determined that it would cost $1.9 billion to prepare patentability justification documents (at an estimated cost of $27,000 apiece) for the 480,000 applications per year that the Patent Office contends would require such documents under the proposed IDS rule.  In justifying these calculations, Mr. Steiner observes that:

Realistically, the business risk of preparing and filing a patentability justification document based on inequitable conduct considerations alone, places [a] patentability justification document in the same risk categories as patent infringement and patent validity opinions which range anywhere from $20,000 to over a $100,000.  I understand that several firms have decided that "examination support documents" ("ESD's," provided under the "Continuations" rule that OMB evaluated in April-July 2007, which in turn are very similar to patentability justification documents in this IDS rule) are "opinions" that must be reviewed by two partners of the firm, adding considerable billable cost to preparing such a document.

Mr. Boundy argues that while the proposed IDS rule will impose significant costs upon applicants, the rule will yield only slight benefits for the Patent Office.  In particular, Mr. Boundy notes that "[i]f the proposed IDS Rule reduced examination time by 10% for the 15% of applications USPTO says would be affected - a generous estimate of the average cost of considering IDS documents affected by the Rule - the potential reduction in total workload is only 1.5%."

In addition to the costs associated with the proposed IDS rule, Mr. Boundy argues that the rule conflicts with case law that requires that applicants and their agents fully disclose all potentially relevant information to the Patent Office.  As Mr. Boundy explains, this conflict arises when an applicant is aware of more than twenty prior art references, and therefore, would be required under the rule to either "[d]eliberately withhold information" from the Patent Office because the proposed IDS rule "forces applicants to submit only the 'most' material information," or submit a (dreaded) patentability justification document describing each prior art reference in detail.  As to how the Patent Office could propose such a flawed rule, Mr. Boundy observes that the Office "has no experience in the area of inequitable conduct (which applies only after a patent issues) and has developed no agency expertise in any area that would enable it to understand the consequences of its proposed regulation."

While Mr. Boundy asserts that the proposed IDS rule would adversely affect many different industries, he argues that the biotechnology and life-sciences industries would be disproportionately affected.  In support of this assertion, Mr. Boundy provides a letter from ZymoGenetics Associate General Counsel Jennifer Johnson, in which Ms. Johnson includes a statistical analysis of patents issued to the top ten biotechnology companies for 2005.  As a result, Mr. Boundy writes that:

[The Patent Office] asserted that "a threshold of twenty documents" would exempt all but 15% of applications.  However, in 2005 in the biotechnology arts, the "20 document" threshold punitively affects 73% of biotech patents, and the "25 page" threshold affects 94% of biotech patents.  Because of the disparate impact on a single, highly-innovative industry, the proposed IDS rule should not be adopted without a careful regulatory impact analysis.

With respect to the "25 page" threshold, Ms. Johnson notes that "biotechnology-related patent applications are generally greater than twenty-five (25) pages in length.  Accordingly, an applicant citing a U.S. Patent document or Foreign Patent document in the biotechnological arts is almost assured of having to submit an explanation with the IDS."  Ms. Johnson also suggests that "it is highly likely that 100% of biotechnology businesses that file and prosecute patent applications would be affected [by the proposed IDS rule], as all of the companies surveyed had issued patents in 2005 that would have triggered the heightened disclosure requirements under the proposed rules."

In his letter to the OMB, Mr. Boundy is not content to merely point out the significant flaws in the Patent Office's proposed IDS rule.  Instead, he also proposes several alternatives, including a restructuring of the fee schedule "so that applications that take more (or more specialized) examination time are charged proportionally higher fees," an allotment of examination time that recognizes differences in application size and complexity, the implementation of an "examination on request" system similar to that used in Europe, Japan, and Canada (which, Mr. Boundy notes, results in about 20% of applications simply being abandoned, with no expenditure of examination resources), and an expanded peer-to-patent program for public submission and comment on prior art references.

DNA Non-obviousness under Ex parte Kubin (It Gets Worse)

    By Kevin E. Noonan --

Last week, the U.S. Patent and Trademark Office promulgated its long-awaited guidelines for Examiners in making obviousness determinations in view of the U.S. Supreme Court's decision in KSR Int'l Co. v. Teleflex Inc. (see "Patent Office Issues Examination Guidelines Regarding Obviousness after KSR").

As part of these guidelines, the Office provided various rationales available to Examiners to fulfill KSR's requirement that the factfinder provide a reasoned basis for an obviousness determination.  One such rationale dealt with the "obvious to try" issue, as discussed by the Supreme Court in KSR:

When there is motivation to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has good reason to pursue the known options within his or her technical grasp.  If this leads to anticipated success, it is likely the product not of innovation but of ordinary skill and common sense.  In that instance the fact that a combination was obvious to try might show that it was obvious under § 103.

The guidelines with regard to the "obvious to try" standard are set forth in Rationale E:

(E) ''Obvious to try'' - choosing from a finite number of identified, predictable solutions, with a reasonable expectation of success;

(1) a finding that at the time of the invention, there had been a recognized problem or need in the art, which may include a design need or market pressure to solve a problem;

(2) a finding that there had been a finite number of identified, predictable potential solutions to the recognized need or problem;

(3) a finding that one of ordinary skill in the art could have pursued the known potential solutions with a reasonable expectation of success; and

(4) whatever additional findings based on the Graham factual inquiries may be necessary, in view of the facts of the case under consideration, to explain a conclusion of obviousness.

Citing KSR, the Notice requires for this rationale that an Examiner articulate facts supporting the conclusion that ''a person of ordinary skill has good reason to pursue the known options within his or her technical grasp.  If this leads to the anticipated success, it is likely the product not of innovation but of ordinary skill and common sense.  In that instance the fact that a combination was obvious to try might show that it was obvious under § 103."

The issue for biotechnology arises in Example 3 illustrating how an Examiner should apply this rationale; that Examiner relates to the Board's decision in Ex parte Kubin (see Patent Docs post on this case):

Example 3:  The claimed invention in Ex parte Kubin, 83 USPQ2d 1410 (Bd. Pat. App. & Int. 2007), was an isolated nucleic acid molecule.  The claim stated that the nucleic acid encoded a particular polypeptide.  The encoded polypeptide was identified in the claim by its partially specified sequence, and by its ability to bind to a specified protein.

A prior art patent to Valiante taught the polypeptide encoded by the claimed nucleic acid, but did not disclose either the sequence of the polypeptide, or the claimed isolated nucleic acid molecule.  However, Valiante did disclose that by employing conventional methods, such as those disclosed by a prior art laboratory manual by Sambrook, the sequence of the polypeptide could be determined, and the nucleic acid molecule could be isolated.  In view of Valiante's  disclosure of the polypeptide, and of routine prior art methods for sequencing the polypeptide and isolating the nucleic acid molecule, the Board found that a person of ordinary skill in the art would have had a reasonable expectation that a nucleic acid molecule within the claimed scope could have been successfully obtained.

Relying on In re Deuel, Appellant argued that it was improper for the Office to use the polypeptide of the Valiante patent together with the methods described in Sambrook to reject a claim drawn to a specific nucleic acid molecule without providing a reference showing or suggesting a structurally similar nucleic acid molecule.  Citing KSR, the Board stated that ''when there is motivation to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has good reason to pursue the known options within his or her technical grasp.  If this leads to anticipated success, it is likely the product not of innovation but of ordinary skill and common sense.''  The Board noted that the problem facing those in the art was to isolate a specific nucleic acid, and there were a limited number of methods available to do so.  The Board concluded that the skilled artisan would have had reason to try these methods with the reasonable expectation that at least one would be successful.  Thus, isolating the specific nucleic acid molecule claimed was ''the product not of innovation but of ordinary skill and common sense.''

This is nothing more, and nothing less, than a per se obviousness standard.  According to the guidelines, the existence of an isolated polypeptide in the prior art, without more, renders obvious a claim to a nucleic acid encoding the polypeptide.  Note that the guidelines do not require that even a partial amino acid sequence of the prior art polypeptide be known, nor does it require that a cell or tissue source of the protein be known, to raise a prima facie obviousness determination against a nucleic acid claim.  To put this in context, human blood clotting Factor VIII, which causes Hemophilia A, was "isolated" from fractionated blood components many years before the gene encoding the protein was isolated.  During that time, the cells producing the protein were not known; it has since been found to be produced by vascular endothelial cells.  Despite this inherent uncertainty, according to the Patent Office (no doubt having been "constantly advised by the patent examiners, who are highly skilled in this art, that cloning procedures are routine in the art"), the nucleic acid encoding Factor VIII would be prima facie obvious in view of the mere existence of a purified preparation of the protein in the art.  This rationale goes even further than the Board in Deuel, since there, the Board's obviousness decision was based on "the examiners urg[ing] that when the sequence of a protein is placed into the public domain, the gene is also placed into the public domain because of the routine nature of cloning techniques."  Here, even this requirement has been dropped.

This result is not required by KSR, and is in fact contrary to it.  The Court did not abrogate In re Deuel in the KSR decision, and the portion of KSR dealing with the "obvious to try" standard is consistent with Federal Circuit precedent, including Deuel:

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?

The admonition that "obvious to try" is not the standard under § 103 has been directed mainly at two kinds of error.  In some 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.  In others, 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.

Obviousness does not require absolute predictability of success.  Indeed, for many inventions that seem quite obvious, there is no absolute predictability of success until the invention is reduced to practice.  There is always at least a possibility of unexpected results, that would then provide an objective basis for showing that the invention, although apparently obvious, was in law nonobvious.  For obviousness under § 103, all that is required is a reasonable expectation of success.

In re O'Farrell (Fed. Cir. 1988) (citations omitted).  Neither of these situations apply per se to isolating a nucleic acid that encodes a known protein.

The guidelines are not even consistent with the Board's decision in Kubin.  There, the Board cited several factual distinctions between the obviousness issue presented by Kubin and the facts in Deuel, including:

1.  In Kubin, a cell "unambiguously" (see below) expressing the gene was known; in Deuel, a protein that the prior art taught was expressed in brain was cloned from placenta.

2.  In Kubin, the nucleotide and amino acid sequence of the mouse ortholog of human NAIL was known; in Deuel, the prior art disclosed three different brain-specific proteins and a partial amino-terminal amino acid sequence thereof.

3.  In Kubin, the art provided an isolated preparation of the cognate protein and a monoclonal antibody that binds to the protein; in Deuel, the art disclosed isolated preparations of three different brain-specific proteins but no antibodies.

4.  In Kubin, the art provided a monoclonal antibody specific for the gene product of the desired cDNA and thus providing a specific probe; in Deuel, the probes were a plurality of degenerate oligonucleotides prepared from the partial amino-terminal amino acid sequences.

5.  In Kubin, the art has developed expression cloning technology and provided an antibody probe specific for the gene product of the desired clone; in Deuel, the absence of a specific antibody precluded use of expression cloning technology.

None of these factual issues are mentioned or required to be considered under the guidelines.

On the law, the Board conflated (and the guidelines set in stone) the issues of the obviousness of a composition of matter and the obviousness of producing it.  This is the same mistake that the Board made in Deuel:

The PTO's focus on known methods for potentially isolating the claimed DNA molecules is also misplaced because the claims at issue define compounds, not methods.  See In re Bell, 991 F.2d 781, 785, 26 USPQ2d 1529, 1532 (Fed. Cir. 1993).  In Bell, the PTO asserted a rejection based upon the combination of a primary reference disclosing a protein (and its complete amino acid sequence) with a secondary reference describing a general method of gene cloning.  We reversed the rejection, holding in part that "the PTO's focus on Bell's method is misplaced.  Bell does not claim a method.  Bell claims compositions, and the issue is the obviousness of the claimed compositions, not of the method by which they are made."  Id.

We today reaffirm the principle, stated in Bell, that the existence of a general method of isolating cDNA or DNA molecules is essentially irrelevant to the question whether the specific molecules themselves would have been obvious, in the absence of other prior art that suggests the claimed DNAs.  . . .  There must, however, still be prior art that suggests the claimed compound in order for a prima facie case of obviousness to be made out; as we have already indicated, that prior art was lacking here with respect to claims 5 and 7.  Thus, even if, as the examiner stated, the existence of general cloning techniques, coupled with knowledge of a protein's structure, might have provided motivation to prepare a cDNA or made it obvious to prepare a cDNA, that does not necessarily make obvious a particular claimed cDNA. "Obvious to try" has long been held not to constitute obviousness.  In re O'Farrell, 853 F.2d 894, 903, 7 USPQ2d 1673, 1680-81 (Fed. Cir. 1988).  A general incentive does not make obvious a particular result, nor does the existence of techniques by which those efforts can be carried out.  Thus, Maniatis's teachings, even in combination with Bohlen, fail to suggest the claimed invention.

The differences in the underlying technological sophistication in the art noted by the Board in Kubin could, under the appropriate circumstances,  render obvious a nucleic acid encoding, for example, a highly-conserved sequence where the art disclosed closely-related species orthologs, the cell or tissue of  origin was reliably known, and specific reagents, such as monoclonal antibodies to the protein, were readily available.  None of these factors are required under the Office's KSR rationale to permit an Examiner to assert a prima facie case of obviousness against a nucleic acid claim.  Perhaps the Office is merely reflecting the current trend to pass as much of the examination burden as possible onto applicants, and expects that in instances where there are facts contrary to Kubin or the guidelines, applicants will provide sufficient rebuttal evidence to overcome the prima facie case.  This procedural avenue, however, does not address the analytical mistake of equating obviousness of the method of making with the obviousness of the thing made.  And by promulgating a per se rule of obviousness it is the Office, not the Federal Circuit, that runs directly afoul of Supreme Court precedent.

Unless Kubin has filed an appeal with a district court or the Federal Circuit, the only way that this guideline will be overturned will be after it has been improperly applied, appealed, affirmed by the Board, and then sent to the Federal Circuit for review.  Even then, the facts of that case will need to be sufficient for the CAFC to properly consider the issue.  It would be easier, and better for American innovation (in biotechnology, where the U.S. remains a leader) if the Office would be more preoccupied with allowing than rejecting patents.  On recent evidence, at least with regard to nucleic acid claiming, the Patent Office appears more interested in settling scores with the Federal Circuit.

Will Compliance with the New Rules Be Enforced by the Patent Office through the Office of Enrollment and Discipline?

    By Kevin E. Noonan --

The Patent Office has met the enemy, and it is the patent bar.  This has been evident since the original Notice of Proposed Rulemaking with regard to the continuation and claims limitations rules, where the Office blamed the bar for the proliferation of continuation applications and alleged prolixity of claiming.  According to the Office, patent attorneys are routinely guilty of incompetence, malfeasance, or misfeasance in representing their clients before the Office, and many if not all of the current Patent Office administration's management problems would be solved if the bar would join the Office in a partnership to improve patent pendency and quality (to paraphrase the upbeat portion of Commissioner Doll's stump speech).  Unfortunately for the bar, "partnering" means just following orders, a definition typical of the current administration's views.

Just in case the bar hasn't appreciated the message, the Office sent Harry Moatz (at left), Director of the Office of Enrollment and Discipline (OED), to reinforce the message at a recent Intellectual Property Owners (IPO) meeting in New York.  In only the second slide of his presentation, Mr. Moatz reminds us that the Office has the capacity to discipline registered practitioners who do not "comply with the regulations promulgated under [the Office's rulemaking authority]."  In particular, this applies to the new rules published on August 21st and going into effect on November 1st.  Specifically, the OED is "considering" attorney conduct with regard to the duty to make a reasonable inquiry and the obligation to avoid submitting papers "for improper purpose or delay."  The Office will be monitoring compliance to detect any violations of these duties, as well as attorney "incompetence or neglect."

Mr. Moatz cited 37 C.F.R. § 10.18(b) as requiring that an attorney fulfill a duty to make an inquiry "reasonable under the circumstances" to avoid submitting papers for an "improper purpose" or delay.  This duty, as understood by the Office, includes an affirmative duty that an attorney read every paper submitted to the Office.  While on its face not an unreasonable requirement, in practice this duty applies to each and every prior art reference submitted in compliance with Rule 56.  Mr. Moatz affirmatively stated that this rule applied to each paper submitted to the Office regardless of its source, and that the paper must be read "in its entirety."  (This raises an interesting dilemma if a foreign patent office cites a reference that is not relevant to U.S. prosecution, such as a reference that is not prior art in the U.S. due to the one-year grace period.  If an attorney submits this reference in an Information Disclosure Statement, is it for an "improper purpose"?)  Moreover, while imposing the requirement that an attorney review a reference for its materiality, the need to perform this analysis does not excuse delay in submitting the reference; this requirement certainly appears to set up a classic Catch-22 situation.

A close reading of the rule indicates that this does not appear to be its purpose:  37 C.F.R. § 10.18(b)(1) states that submitting a paper certifies that any statement made therein does not "cover up" a material fact "by any trick, scheme or device," and 37 C.F.R. § 10.18(b)(2) imposes a duty to make reasonable inquiry that the paper is not filed for any "improper purpose."  The Office is interpreting these requirements to have the same attributes as Rule 11 of the Federal Rules of Civil Procedure, without any apparent justification (and in view of the differences between ex parte prosecution and inter partes litigation, without any logical underpinnings).  The Office clearly intends to apply these rules to require a prefiling inquiry, although the Office concedes that time constraints might demand that an application be filed before completion of the reasonable inquiry, resulting in a duty to file documents or amendments to comply.  Of course, this requirement may be in conflict with the well-established principle that an applicant (or his or her counsel) is under no obligation to perform a prefiling search (which could qualify as a "reasonable inquiry").

Mr. Moatz provided a number of examples of conduct that might run afoul of the Office's ethical rules.  These include:

• filing a reference material to patentability "buried among a large number of cumulative references, where the buried reference anticipates one or more claims;" under these circumstances there cannot have been a "reasonable inquiry";
• filing an application with claims that are anticipated by at least one publication authored by one of the inventors;
• adding an "undue" number of claims with multiple dependent claims (where the fact that multiple dependencies can involve "thousands of claims" appears to be sufficient to establish that there could have been no reasonable inquiry); and
• filing a paper without the required fee, due to insufficient funds or stopped payment.

There are certainly ways in which the Office could apply these rules reasonably to stem actual abuses; however, the timing of this message from the Office does not suggest that reasonableness will be the watchword.

Mr. Moatz's presentation also contained a discussion of inequitable conduct.  Again, the presentation emphasized an attorney's continuing duty to make a reasonable inquiry.  The presentation cited Brasseler, U.S.A. LLP v. Styker Sales Corp., 267 F.3d 1370 (Fed. Cir. 2001) in this regard, a case where the CAFC characterized attorney conduct as constituting a "studied refusal to timely investigate" and failure to disclose material information.  This requirement is illustrated by the following scenario:

• A first practitioner advises applicant that prior art is material to patentability of the claimed invention and must be disclosed to the USPTO.
• The applicant refuses to follow this course of action and discharges the first practitioner.
• The applicant engages a second practitioner without telling the second practitioner of the potentially damaging prior art.
• Under § 10.85(b), the first practitioner would be required to disclose this situation to the Office.

(see Practice Before the Patent and Trademark Office, Final Rule 50, FR 5158, 5165 (Feb 8, 1985)).  While not unreasonable on its face, this example raises questions about the extent to which the first practitioner "knows" the applicant has filed the application without disclosing the "potentially damaging" prior art.  Is mere publication of an application enough, or does the rule require actual knowledge?  Does the duty of reasonable inquiry apply in this instance as well, where the first practitioner does not represent the applicant and is not involved in (and may have no reason to know about) filing or prosecution of the improper filing by the second practitioner?  The presentation does not make this clear, and application of the rule is thus fraught with undefined interpretations of the meaning of the "reasonable inquiry" requirement.

There is a perverse beauty to Mr. Moatz's message.  The Office is not proposing any new rules; indeed, Mr. Moatz reminded his listeners that these rules were promulgated in 1997.  This warning from the Office merely threatens to apply the existing rules of conduct to force compliance inter alia with the new procedural rules.  The possibility exists that these rules of conduct will be applied fairly and that discipline will be applied only to those practitioners who affirmatively break the Office's ethical rules or practice fraudulently in violation of their duties.  However, the timing and emphasis of Mr. Moatz's presentation suggests otherwise.  Under these circumstances, the only thing that is certain is that the members of the patent bar have been warned.

For additional information regarding specific provisions of the New Rules, please see:

• "USPTO Issues Notice to 'Clarify' Certain Provisions of the New Rules," October 10, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.78(a)(2): Divisional Dilemma?" October 9, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.142(c): Increasing the Chances of Submitting a Successful Suggested Restriction Requirement (SRR)," October 4, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.145: "Provoking a Restriction Requirement," October 3, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.78(d)(1)(i) & (vi): PCT Practice," September 23, 2007
• "An Analysis of the New Rules: USPTO Releases ESD Guidelines," September 17, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.265: Examination Support Document," September 13, 2007
• "An Analysis of the New Rules: Revisions to First Action and Second Action Final Practice," September 11, 2007
• "An Analysis of the New Rules: 37 C.F.R. §§ 1.78(d)(1) and 1.114: Streamlined Examination," September 10, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.117: Refund Due to Cancellation of Claims," September 10, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.142: Suggested Restriction Requirements," September 6, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.114: RCE Practice," September 5, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.75(b): 5/25 Limit on Claims," September 4, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.78(d)(1): Claims for Benefit of Prior-Filed Applications," September 3, 2007
• "An Analysis of the New Rules: 37 C.F.R. § 1.78(f): Commonly Owned Applications and Patents," August 27, 2007

For additional information on this and other related topics, please see:

• "USPTO News Briefs," October 18, 2007
• "PTO 'Flagging' Pending Applications that Exceed 5/25 Claim Limits," October 17, 2007
• "Hooray! - (Finally) the Big Dogs Have Joined the Hunt," October 11, 2007
• "Changes to New Rules to Be Published in Early November," October 11, 2007
• "'Impact' of New Continuation and Claims Rules," October 8, 2007
• "Is the Patent Office Starting to Blink," October 5, 2007
• "Breaking A Very Long Silence," October 1, 2007
• "It Ain't Necessarily So," September 28, 2007
• "Commissioner Doll Addresses ACI Biotech Patents Conference," September 26, 2007
• "Rules Challenger Amends Complaint and Withdraws PI Motion," September 11, 2007
• "Inventor Sues PTO to Prevent New Continuation Rules from Taking Effect," August 30, 2007
• "Patent Office Provides Recorded Web-Based Discussion of New Rules," August 30, 2007
• "New PTO Continuation Rules: Unfair to Biotech?" August 29, 2007
• "Proposed Agenda for September 12, 2007 Biotechnology/ Chemical/Pharmaceutical Art Group Meeting," August 24, 2007
• "The 'Word' on the New Continuation Rules (from the USPTO Webcast) - Part II," August 24, 2007
• "The 'Word' on the New Continuation Rules (from the USPTO Webcast) - Part I," August 23, 2007
• "New Continuation and Claims Rules Published," August 22, 2007
• "More on M.P.E.P. § 710.06," August 20, 2007
• "Patent Office to Hold Webcast on New Claim and Continuation Rules on August 23, 2007," August 20, 2007
• "Patent Office Announces that New Continuation and Claims Rules Will Be Published . . . Tomorrow," August 20, 2007
• "Procuring Patent Protection from the Present USPTO," August 15, 2007
• "New Continuation and Claims Rules to Be Published in Late Summer," July 25, 2007
• "They Just Don't Get It - 'Patent Reform' at the USPTO," April 11, 2007
• "Patent Applicants Beware: The Rules Are Changing (Again)" Part 1 and Part 2, November 6, 2006

USPTO News Briefs

    By Donald Zuhn --

The U.S. Patent and Trademark Office has added four new forms to its Claims and Continuations Practice webpage.  The new form likely to get the most use is PTO/SB/206, which can be used to identify commonly owned applications and patents pursuant to Rule 78(f)(1) and provide a rebuttal or terminal disclaimer/ explanation pursuant to Rule 78(f)(2) (see "An Aanlysis of the New Rules: 37 C.F.R. § 1.78(f): Commonly Owned Applications and Patents").  Also provided is PTO/SB/201, which can be used to request streamlined docketing (see "An Analysis of the New Rules: 37 C.F.R. § 1.78(d)(1) and 1.114: Streamlined Examination").  Two new forms which practitioners may find to be less useful are PTO/SB/211, for submitting a list of references in an Examination Support Document (ESD), and PTO/SB/216, which is a transmittal for submitting an ESD (see "An Analysis of the New Rules: 37 C.F.R. § 1.265: Examination Support Document" and "USPTO Releases ESD Guidelines").

On Monday, the Patent Office announced that the latest version of the Manual of Patent Examining Procedure (M.P.E.P.) -- 8th Edition, Revision 6 -- is now available.  The parts of the latest version of the M.P.E.P. that have been updated are the Blue Pages (a complete list of changes to the latest version of the M.P.E.P.); the Title Page; Chapter 700 (Examination of Applications), Chapter 1800 (Patent Cooperation Treaty), and Chapter 2100 (Patentability); Appendix II (List of Decisions Cited), Appendix L (Patent Laws; Title 35), Appendix R (Patent Rules; 37 C.F.R.), Appendix T (Patent Cooperation Treaty), and Appendix AI (Administrative Instructions Under the PCT); and the Index.  None of the changes to the latest version of the M.P.E.P. concern the new continuation and claims rules.  Of particular interest to Patent Docs readers is the fact that, according to the Blue Pages, M.P.E.P. § 710.06 has only been changed to delete reference to a 1924 Commissioner's Decision.  Thus, it appears that this section can still be used by applicants, as reported here previously (see "Procuring Patent Protection from the Present PTO" and "More on M.P.E.P. § 710.06"), to seek correction of errors in an Office action.

Finally, last Thursday, the Patent Office published corrections to its April 2007 Revision of Patent Cooperation Treaty Procedures notice, as previously reported here.

The Continuing Threat to Human Gene Patenting

    By Kevin E. Noonan --

Reliable sources inform Patent Docs that the House of Representatives, having finished its summer portion of mischief by passing H.R. 1908 "reforming" U.S. patent law into unrecognizability, is set to turn its attention to the bill, introduced by Congressman Becerra (31st Dist., Cal.) (at right), that would ban human gene patenting.  Although initially thought to be so wrong-headed that the House would not seriously consider the bill, it now appears that - like patent "reform" - the House political majority may be content in continue meddling in patent law in the absence of their ability to garner a majority (a veto-proof majority, in any event) in support of solutions to more pressing national concerns.

To review, the bill as introduced on February 7, 2007 reads as follows:

A BILL

To amend title 35, United States Code, to prohibit the patenting of human genetic material.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ''Genomic Research and Accessibility Act''.

SEC. 2. PROHIBITION ON PATENT OF HUMAN GENETIC MATERIAL.

(a) IN GENERAL. -- Chapter 10 of title 35, United States Code, is amended by adding at the end the following new section:

"§ 106. Prohibition on patent of human genetic material

"Notwithstanding any other provision of law, no patent may be obtained for a nucleotide sequence, or its functions or correlations, or the naturally occurring products it specifies.''.

(b) TABLE OF CONTENTS. -- The table of sections of Chapter 10 of title 35, United States Code, is amended by adding at the end the following:

"106. Prohibition on patent of human genetic material.''.

(c) APPLICABILITY. -- The amendment made by subsection (a) shall not apply to a patent issued before the date of the enactment of this Act.9

There are a number of problems with the scope of this bill.  First, it is not limited to banning DNA patenting.  The prohibition is to "a nucleotide sequence, or its functions or correlations, or the naturally occurring products it specifies"  If passed, this bill would ban not only DNA patenting itself but also a patent on "the naturally-occurring products [a nucleic acid] specifies."  This would ban patenting of all naturally-occurring proteins produced by any means.  This would include proteins such as blood clotting Factor VIII, erythropoietin, hemoglobin, albumen, and human growth hormone, to name only a few.  It would also ban any diagnostic assay depending on the identification of genetic polymorphisms such as single nucleotide polymorphisms (SNPs), no matter how deduced.  This would render unpatentable not only existing polymorphism-based assays but those yet to be developed.  In short, the bill would eliminate patent protection for the molecules that are expected to provide the "pipeline" of new drugs for the next twenty years.  (It would not, paradoxically, render unpatentable recombinant cells and organisms used to produce useful quantities of these gene products that could otherwise not be obtained in useful quantities.)

In addition to these practical reasons to defeat the bill, it is based on a flawed understanding of the science underlying biotechnology.  This issue has been the subject of prior Patent Docs posts, but let's recap:

1.  No one owns "your" genes.  Indeed, no one would want to:  it has been known for more than forty years that any particular copy of a gene in an individual in a population is likely to contain at least one polymorphism that does or could (under the right environmental conditions) affect its function.  This was illustrated recently in reports of the complete diploid genomic DNA sequence of J. Craig Venter's (at right) DNA, where more than 4 million nucleotide variants were detected (see "A Complete Diploid Human Genome Reveals Some Surprises").  More importantly, claims to nucleic acids require that they are "isolated" or "isolated and purified," and thus "your" DNA is outside the scope of any such claims.

2.  There is nothing unique about DNA.  Indeed, "a gene is but a chemical, albeit a complex one."  Amgen Inc. v. Chugai Pharmaceutical Co.  Rhetoric to the contrary is nothing less than an attempt to return to vitalism, the quasi-religious notion that natural products isolated from living things are somehow different from what can be found or produced from the inorganic world.  This notion was disproven more than 100 years ago by Friedrich Wohler's demonstration that urea (produced in mammalian urine) was in fact merely a chemical compound that could be produced from non-living chemicals in a laboratory.

3.  The types of patent protection given to nucleic acids are no different than protection for other types of chemical inventions.  Indeed, there is no basis for distinguishing nucleic acid patents from any other type of chemical compound (see "A DNA Patenting Thought Experiment").

4.  DNA patents do not only claim nucleic acids but disclose them, and this aspect - the information that is the nucleotide sequence of the gene and an accurate deduced amino acid sequence - is not protected;  indeed, the information is placed in the public domain and can be used as information for database searching, interspecies comparisons, and any other academic endeavor.

5.  DNA patents have had no appreciable affect on scientific research, despite fears (ultimately shown to be baseless) that they would create a "tragedy of the anticommons" (see "The True Tragedy of the Anti-Commons").  Ironically, banning gene patenting would likely create a "tragedy of the commons" because no one would have sufficient protection for the intellectual property that would justify investment in the technology.

6.  Although the bill excludes already-issued patents from the scope of the ban, it does not exclude already-filed applications which form the bulk of the nascent patent rights of DNA patents (including the provisional rights created by publication of U.S. applications disclosing and claiming these genes).  Applicants, having had certain property rights attach by the filing and publication of these sequences (as opposed to, for example, keeping them as trade secrets), passage of the bill would violate the prohibition against ex post facto lawmaking set forth in Article I, section 9 of the Constitution and would also be a unconstitutional taking.  It might also violate the Due Process Clause of the 14th amendment.

7.  Banning gene patenting would reduce the advantages the U.S. has enjoyed for the past 20 years over the rest of the world, that was slow to permit patenting of genes and other products of biotechnology.  The U.S. biotechnology industry has resulted in U.S. dominance in the pharmaceutical industry, to the detriment of the very European and Japanese companies poised to overtake this country economically in the past (see "The Continuing Value of Biotech Patenting").  Patent policies abroad already permit those countries to "free-ride" on American innovation.  Why should we adopt their failed policies here?  And who will create the next generation of drugs based on biotechnology if we do?

We have seen ample evidence of the harm that can be wrought on the patent system when extreme policies are adopted in response to a perceived problem supported by faulty logic and incorrect "evidence:"  the recent changes in patent practice occasioned by U.S. Patent and Trademark Office rules limiting continuation applications and claims are but one example.  Twisting U.S. patent law to ban DNA patenting begs the question of when will another special interest group attempt to influence legislators into enacting their particular special interest into law so they can infringe on the intellectual property of others with impunity.  Biotech patenting has allowed a generation of (predominantly) U.S. companies to bring diagnostic tests and therapeutic agents to market and to attack diseases that were death sentences just a few short years ago.  Political Cassandras and opportunists do us no service with their misinformed cries that the sky is falling; we listen to them at our peril.

For additional information on this topic, please see:

• "The Anti-Patent Beat Goes on at The New York Times," July 1, 2007
• "The Future of DNA Patenting," February 20, 2007
• "A DNA Patenting Thought Experiment," February 16, 2007
• "Science Fiction in The New York Times," February 13, 2007
• "The Continuing Value of Biotech Patenting," February 4, 2007
• "Anti-Patent (Sullivan?) Malice by The New York Times," January 29, 2007
• "In Support of Gene Patents," December 7, 2006
• "The 'Anti-Commons' Aren't So Tragic After All," October 27, 2006
• "Gene Patenting in the News Again," December 5, 2006

PTO "Flagging" Pending Applications that Exceed 5/25 Claim Limits

    By Jason Derry --

Patent Docs has learned from posts to the "EFS-Web" list that the U.S. Patent and Trademark Office is now identifying applications in private PAIR as failing to comply with the new 5/25 claim limitation rules.  Users of Partridge, a free program developed by the Oppedahl Patent Law Firm LLC to help monitor status changes in PAIR, have reported that several of their pending applications that have more than 5 independent claims and more than 25 total claims are now shown in PAIR as "flagged for 5/25" or "Request for SIR -- Recorded."  The last identifier is a bit of a mystery, since the users reported that they had not requested SIRs.

The Patent Office seems to be actively identifying pending applications in which a notice of non-compliance with 37 C.F.R. § 1.75(b) needs to be issued.  Thus, applicants should be identifying their applications that are destined to receive a notice under Rule 75(b)(3), and should decide how to place those applications into compliance with the new claim limitation rules.  Otherwise, applicants will be forced to comply with the new 5/25 claim limits within a two-month, extendable time limit imposed by a notice under Rule 75(b)(3).  Unless the notice accompanies a requirement for restriction from the Examiner, options for responding to the notice include: (1) filing an Examination Support Document (ESD); (2) filing a new set of claims that comply with the 5/25 limits; or (3) filing a Suggested Requirement for Restriction (SRR).

For additional information regarding this topic, please see:

• "Patent Office Has Stopped Examining Patents with 25+ Claims," Patently-O

Jason Derry, Ph.D., who graduated with honors from DePaul University College of Law, is a molecular biologist and founding author of Patent Docs.

Patent Profile: Immunomedics Awarded Patent Covering Pancreatic Cancer Therapeutic

    By Sherri Oslick --

Immunomedics, Inc. of Morris Plains, NJ has been awarded U.S. Patent No. 7,282,567 ("Monoclonal antibody hPAM4," issued October 16, 2007) covering a humanized monoclonal antibody to a particular epitope in the MUC1 antigen expressed in most pancreatic cancers.  The patent also covers therapeutic and diagnostic derivatives of hPAM4 for treating pancreatic cancer.

The newly issued patent covers Immunomedics' product Y-90 hPAM4, which is a yttrium-90-labeled hPAM4 currently in Phase I clinical trials.  Y-90 hPAM4 has received Orphan Drug Status from the FDA.

The '567 patent issued from U.S. Application No. 10/461,885, which was filed on June 16, 2003 and which claims the benefit of U.S. Provisional Application No. 60/388,314, filed June 14, 2002.  Independent claim 1 recites:

1. A humanized antibody or an antigen binding fragment thereof, comprising the complementarity-determining regions (CDRs) of a murine PAM4 monoclonal antibody (MAb) and the framework (FR) regions of the light and heavy chain variable regions of a human antibody and the light and heavy chain constant regions of a human antibody, wherein the CDRs of the light chain variable region of the humanized PAM4 Mab comprise CDR1 (SASSSVSSSYLY, SEQ ID NO:1); CDR2 (STSNLAS, SEQ ID NO:2); and CDR3 (HQWNRYPYT, SEQ ID NO:3); and the CDRs of the heavy chain variable region of the humanized PAM4 Mab comprise CDR1 (SYVLH, SEQ ID NO:4); CDR2 (YINPYNDGTQYNEKFKG, SEQ ID NO:5)and CDR3 (GFGGSYGFAY, SEQ ID NO:6), wherein said antibody or fragment thereof binds to a domain located between the amino terminus and the start of a repeat domain of MUC1.

Strafford CLE on New Continuation and Claims Rules

Strafford CLE Teleconferences will be offering a telephone conference entitled: "Sweeping USPTO Patent Rule Changes for Continuations and Claims: Strategies to Meet the New Obligations under the Complex Rules" on October 24, 2007 from 1:00-2:30 PM (EST).  Speakers Marc E. Brown and Bernard Codd of McDermott Will & Emery and Stephen G. Kunin of Oblon Spivak McClelland Maier & Neustadt will address questions such as:

• What should counsel and IP owners know about the most significant changes the USPTO put into place?
• What will be the practical and immediate impact of the new rules for IP owners and counsel?
• What new strategies should counsel consider and implement in dealing with the USPTO under the new rules?

An interactive Q&A session will follow the speaker presentations.  The registration fee for this telephone conference is $297.  A program outline for the teleconference can be obtained here.  Those interested in registering for the teleconference, can do so here, or by calling 800-926-7926.

Abbott Labs. v. Torpharm, Inc. (Fed Cir. 2007)

ANDA Filing Not Violation of Express Terms of Injunction

    By Sherri Oslick --

In an opinion authored by Chief Judge Michel and issued late last week, the CAFC reversed the United States District Court for the Northern District of Illinois, finding Apotex not to have violated an injunction prohibiting it from manufacturing, using, selling, offering for sale, or importing into the United States generic divalproex sodium until the expiration of U.S. Patent Nos. 4,988,731 and 5,212,326.  Divalproex sodium (an oligomer of units of sodium valproate and valproic acid) is marketed by Abbott as Depakote®, and is an anti-seizure medication.  The claims of the '731 and '326 require that the oligomer contain 4-6 units.

The present holding represents round 3 at the CAFC for the parties.  In 1997, Apotex filed an ANDA seeking approval to market generic Depakote®; the ANDA included a Paragraph IV certification of invalidity against the '731 and '326 patents, the two patents listed in the Orange Book for Depakote®.  Abbott filed suit against Apotex for infringement of the '731 and '326 patents, and obtained a favorable ruling on summary judgment on both validity and infringement.  Apotex appealed; the CAFC affirmed the ruling on validity but remanded for a trial on infringement.  Following a bench trial, Judge Posner (sitting by designation) determined that Apotex's filing of an ANDA infringed Abbott's patents as Abbott had proved by a preponderance of the evidence that Apotex's product was a 4-6 unit oligomer of divalproex sodium.  As such, the District Court entered an injunction prohibiting Apotex from "commercially manufacturing, using, selling, or offering to sell generic divalproex sodium which the Court has found to be infringing within the United States, or from importing such product into the United States, until Abbott's U.S. Patent Nos. 4,988,731 and 5,212,326 expire and defendants have received final approval from FDA to market generic divalproex sodium."  Apotex appealed the judgment and the CAFC affirmed without opinion.

Subsequently, Apotex attempted to prepare a design-around having greater than 6 units of divalproex sodium, and entered into an agreement with Nu-Pharm (formerly owned by Apotex's parent company) whereby Apotex would fund, but Nu-Pharm would file, an ANDA for the design-around.  Nu-Pharm's ANDA was filed in 2005 with a Paragraph IV certification of non-infringement, and Abbott responded by filing suit against Nu-Pharm.  After Nu-Pharm filed an amended ANDA directed to additional dosages, and having learned of the defendants' relationship, Abbott filed a second suit, this time against Nu-Pharm and Apotex.  Upon motion by Abbott, the second suit was reassigned to Judge Pallmeyer based on its relatedness to the first case.

On the day that Nu-Pharm moved for summary judgment of non-infringement before Judge Pallmeyer, Abbott moved both to enforce the injunction before Judge Posner and to stay the proceedings in front of Judge Pallmeyer.  The stay was granted, and Judge Posner found Apotex in contempt, interpreting the injunction to cover any generic divalproex sodium found to be infringing.  Because Posner found no difference (and therefore no "colorable" difference) between Apotex's prior product and its design-around, he found Apotex's new product to infringe the claims of Abbott's patents and extended the injunction to cover the Nu-Pharm ANDA.  Apotex appealed.

On appeal, Apotex argued that the District Court had no statutory authority to entertain the contempt proceeding as the Hatch-Waxman Act does not grant such subject matter jurisdiction, and in the alternative, that the proceedings were improper as an infringement inquiry was to be handled only by trial under the Federal Rules of Civil Procedure.  Specifically, on the first point, Apotex argued that in a Hatch-Waxman scenario, such a contempt proceeding was unlawful because the underlying suit is filed prior to any "classically infringing" activity (i.e., making and selling an infringing product) and more specifically, that Apotex had not engaged in such activities.  In short, asserted Apotex, the "artificial infringement" as a result of their second ANDA filing was not an act subject to scrutiny in a contempt proceeding.

The CAFC dismissed Apotex's argument, noting that it had held numerous times that, albeit "highly artificial," the filing of a Paragraph IV certification as part of an ANDA was, by statute, an act of infringement and that infringement in a Hatch-Waxman suit was to be analyzed in the same way as any other infringement suit.  Moreover, noted the CAFC, the District Court had authority outside of the Hatch-Waxman Act in general principles of equity governing injunctions.  The District Court, according to the CAFC, had the authority to enforce its injunction through contempt proceedings, and nothing in the Hatch-Waxman Act ran contrary to this.

Additionally, while the CAFC recognized that it had previously cautioned against contempt proceedings of a summary nature where expert and other testimony would be helpful, such as in an infringement determination, it noted that such caution applied where an alleged infringer made a "good faith effort to modify" a prior infringing product.  In this case, however, the lower court concluded that Apotex's decision to have Nu-Pharm file the second ANDA was nothing more than a "subterfuge intended to give Apotex a crack at another district judge" and a more favorable ruling.  The CAFC declined to disturb that finding, and concluded that it was not an abuse of discretion on the part of the lower court to address issues of infringement related to the Nu-Pharm ANDA in a contempt proceeding.

Moreover, the CAFC, in applying its two part test, affirmed the lower court's finding that the subject of the Nu-Pharm ANDA was an infringing product, and that the extension of the injunction to include this product was not an abuse of discretion.  According to the first part of the two part test, the District Court must address whether a contempt proceeding is the proper forum for addressing infringement of the design-around, including an assessment of whether there is more than a colorable difference between the original and new products such that there are substantial issues to be tried.  The CAFC found that the lower court, which carefully reviewed the evidence presented, did not abuse its discretion in determining that there was no colorable difference the two products and that contempt proceedings were appropriate.  In the second part of the two part test, the lower court must then engage in an infringement determination.  Here, the CAFC found, in light of all the evidence, that the lower court did not clearly err in this regard.

With regard to the ultimate finding of contempt, however, the CAFC reversed the District Court, finding an error of law in the lower court's interpretation of the original injunction to include the mere act of filing an ANDA.  The original injunction, noted the CAFC, was limited to commercial acts within the U.S., and as it was undisputed that Apotex's design-around activities all occurred outside of the U.S., Apotex had not violated the injunction.  In short, while the CAFC concluded that the Nu-Pharm ANDA filing was an act of infringement, it was not a violation of the injunction, and the lower court had erred in misinterpreting the injunction as excluding acts beyond its plain terms.

Dissenting-in-part, Judge Dyk asserted that the contempt proceedings were inappropriate as there was "fair ground of doubt" as to whether the injunction applied.  Specifically, because the original injunction did not preclude the filing of an ANDA, argued Judge Dyk, there was a "fair ground of doubt" as to whether Apotex's conduct was wrongful, summary contempt proceedings were therefore inappropriate, and the majority's use of the "colorable difference" test was a too narrow an application of the more general "fair ground of doubt" test.  In a lengthy footnote, the majority countered the dissent by noting that Judge Dyk failed to identify any doubt that would require full litigation rather than a summary proceeding, and more particularly, what was doubtful about the determination that the Nu-Pharm ANDA did not fall within the injunction.  Summary determination was appropriate, countered the majority, as there was no doubt in either the infringement determination or the determination that an ANDA filing was outside of the scope of the original injunction.  The dissent's approach of requiring full litigation on infringement, rather than a contempt proceeding, according to the majority, would serve neither Apotex's due process interests nor judicial economy where the ultimate determination was that the filing of the ANDA was not a violation of the injunction.

Abbott Labs. v. Torpharm, Inc. (Fed. Cir. 2007)
Panel: Chief Judge Michel, Circuit Judge Dyk, and District Judge Otero
Opinion by Chief Judge Michel; opinion concurring-in-part and dissenting-in-part by Circuit Judge Dyk

Additional information regarding this case can be found at Patently-O and the Orange Book Blog.