Patent Docs

CLS Bank Int'l v. Alice Corp. (Fed. Cir. 2013) (en banc) -- Judge Lourie's Concurrence

By Michael Borella --

On May 10, the Federal Circuit handed down a much anticipated en banc ruling regarding the patent eligibility of computer-implemented inventions under 35 U.S.C. § 101.  In a per curiam opinion that is perhaps the most important § 101 jurisprudence since the Supreme Court's Bilski v. Kappos and Mayo v. Prometheus decisions, a plurality of judges set forth procedures for determining whether claims that recite an abstract idea or a law of nature meet the requirements of this section.  While the overall effect of this case remains to be seen and is likely to be a subject of heated debate, this decision has the potential to impact both patent litigation and prosecution.

In 2007, CLS Bank filed a declaratory judgment action against Alice Corp., contending that, among other things, Alice's U.S. Patents Nos. 5,970,479, 6,912,510, and 7,149,720 were invalid under § 101.  Alice filed counterclaims alleging infringement of these three patents.  Later, Alice's U.S. Patent No. 7,725,375 was added to the mix, and the parties respectively asserted invalidity and infringement contentions for this patent as well.

All four patents are from the same family and "share substantially the same specification."  The plurality described the claimed subject matter as:

[A] computerized trading platform used for conducting financial transactions in which a third party settles obligations between a first and a second party so as to eliminate "counterparty" or "settlement" risk . . . .  Settlement risk refers to the risk to each party in an exchange that only one of the two parties will actually pay its obligation, leaving the paying party without its principal or the benefit of the counterparty's performance.  Alice's patents address that risk by relying on a trusted third party to ensure the exchange of either both parties' obligations or neither obligation.

Between the four patents, method, computer-readable medium (CRM), and system claims were asserted.  The parties stipulated that all claims, including the method claims, require "a computer including at least a processor and memory" and electronic implementation, even though the representative method claim analyzed by the Federal Circuit did not literally recite such a requirement.

The District Court held that all asserted claims failed to meet the requirements of § 101, and thus were invalid.  Particularly, the District Court concluded that the method claims were directed to an unpatentable abstract idea, and that the CRM and system claims would similarly preempt all practical applications of this idea, despite those claims falling under a different statutory category.

On appeal, a Federal Circuit panel reversed the District Court on all counts, holding that all claims, including the method claims, were patent eligible under § 101.  CLS petitioned the full Federal Circuit for review, which was granted.  Sitting en banc, seven of the ten judges overruled the panel and affirmed the District Court's ruling regarding the method and CRM claims.  However, this majority did not agree on the rationale for their conclusion.  Further, five of the judges found that the system claims were unpatentable, while the other five concluded that these claims passed muster under § 101.  Additionally, eight of the judges indicated that the method, CRM, and system claims must rise or fall together.  Consequently, the precedential value of his decision, especially with respect to the system claims, may be limited.

Below, Judge Lourie's plurality concurrence is discussed.  Joining him were Judges Dyk, Prost, Reyna, and Wallach.  The other concurrences and dissents will be examined in subsequent posts.

Judge Lourie admitted the difficulty of analyzing patentability under § 101, and acknowledged the need for a more practical approach to this analysis:

While simple enough to state, the patent-eligibility test has proven quite difficult to apply.  The difficulty lies in consistently and predictably differentiating between, on the one hand, claims that would tie up laws of nature, natural phenomena, or abstract ideas, and, on the other, claims that merely embody, use, reflect, rest upon, or apply those fundamental tools.  For example, deciding whether or not a particular claim is abstract can feel subjective and unsystematic, and the debate often trends toward the metaphysical, littered with unhelpful analogies and generalizations.  What is needed is a consistent, cohesive, and accessible approach to the § 101 analysis -- a framework that will provide guidance and predictability for patent applicants and examiners, litigants, and the courts.  (Citation omitted.)

Judge Lourie then turned to the inevitable overview of Supreme Court decisions impacting § 101 as guideposts for this analysis.  In an example of judicial foreshadowing, he viewed Benson, Flook, Deihr, and Bilski through the lens of Prometheus.  In particular, he focused on the judicial exception to patentable subject matter when the claims at issue incorporate abstract ideas or laws of nature.  Then, he applied Prometheus's approach for analyzing such claims, with special concern for whether a claimed invention would effectively preempt other uses of any potentially abstract idea recited therein.

Particularly, Judge Lourie set forth a four-step analysis for patent eligibility under § 101 based heavily on Prometheus.  These steps are as follows:

1)  Determine "whether the claimed invention fits within one of the four statutory classes set out in § 101."  In other words, is the invention directed to a process, machine, manufacture, or composition of matter?

2)  Determine whether "the claim pose[s] any risk of preempting an abstract idea."  Or, does the claim incorporate an abstract idea?

3)  If an abstract idea is implicated by the claim, then "identify and define whatever fundamental concept appears wrapped up in the claim so that the subsequent analytical steps can proceed on a consistent footing."  Judge Lourie indicates that carrying out claim construction activities prior to this step may be helpful, but is not required.

4)  Finally, "[w]ith the pertinent abstract idea identified, the balance of the claim can be evaluated to determine whether it contains additional substantive limitations that narrow, confine, or otherwise tie down the claim so that, in practical terms, it does not cover the full abstract idea itself."

Judge Lourie refers to this final step as "inventive concept" analysis.  He explicitly states that this "balance of the claim" -- the human contribution -- need not require inventiveness in the same sense that claims must be novel and non-obvious under sections 102 and 103, respectively.  However, he does not clearly differentiate how this inventive concept analysis would differ in practice from, say, an obviousness analysis.  Instead he asserts that:

An "inventive concept" in the § 101 context refers to a genuine human contribution to the claimed subject matter . . . .  [A] person cannot truly "invent" an abstract idea or scientific truth.  He or she can discover it, but not invent it.  Accordingly, an "inventive concept" under § 101 -- in contrast to whatever fundamental concept is also represented in the claim -- must be a product of human ingenuity.

Compared to novelty and non-obviousness analyses "which consider whether particular steps or physical components together constitute a new or nonobvious invention," Judge Lourie states that the inventive concept analysis "considers whether steps combined with a natural law or abstract idea are so insignificant, conventional, or routine as to yield a claim that effectively covers the natural law or abstract idea itself."  But, in practice, this distinction may easily become blurred, and seems to advocate that claims be considered piecemeal under § 101 rather than as a whole.

Furthermore, at first blush, Judge Lourie's differentiation between discovery and invention seems like an aesthetically pleasing dichotomy -- after all, one could say that Pythagoras didn't invent the Pythagorean Theorem, but he did discover it.  However, Judge Lourie went on to point to four potentially subjective factors that would weigh against whether the human contribution to the claimed invention rises to such a level that the claim as a whole meets § 101 requirements:

1)  Is the human contribution necessary to every practical use of the abstract idea and therefore is not truly limiting.

2)  Does the human contribution "amount to more than well-understood, routine, conventional activity previously engaged in by researchers in the field?"

3)  Does the human contribution consist of token or trivial limitations, such as insignificant post-solution activity?

4)  Is the human contribution a "field-of-use limitation . . . where the claim as written still effectively preempts all uses of a fundamental concept within the stated field?"

Applying this approach to the patents in suit, Judge Lourie found that all claims failed under § 101.  The representative method claim was found to be directed to the reduction of settlement risk using a third-party intermediary.  As such, Judge Lourie concluded that this claim recited an abstract idea -- a "disembodied concept, a basic building block of human ingenuity, untethered from any real-world application."  Therefore, he turned to whether the remaining aspects of the claim added anything of substance.  He concluded that they did not.

Notably, this method claim did not recite any required physical structure.  It did not include a memory, a processor, transmitters or receivers, or any other computer component or peripheral.  Despite the parties' stipulation that the claim was computer implemented, Judge Lourie indicated that such a limitation was "insignificant post-solution activity" and that "simply appending generic computer functionality to lend speed or efficiency to the performance of an otherwise abstract concept does not meaningfully limit claim scope for purposes of patent eligibility."  Thus, he concluded that "[a]s in Bilski, upholding Alice's claims to methods of financial intermediation would pre-empt use of this approach in all fields, and would effectively grant a monopoly over an abstract idea."

Judge Lourie similarly found the representative CRM claim unpatentable as well, despite its recitation of a tangible article of manufacture, which would ostensibly be a physical device.  This claim essentially recited the invention of the method claim, but in CRM form.  Judge Lourie asserted that "under § 101 we must look past drafting formalities and let the true substance of the claim guide our analysis."  Applying this analysis he concluded that the CRM claim was actually drawn to "the underlying method of reducing settlement risk using a third-party intermediary," and that it was merely a method claim in the guise of a device claim.  He further warned that one should not allow a competent draftsman to "endow abstract claims with patent-eligible status."

The representative system claim also fell under Judge Lourie's analysis.  This claim recites ample structure -- including a data storage unit and a computer that receives data, performs operations on the data, and generates an instruction to an "exchange institution."  Nonetheless, Judge Lourie found that the similarity between the method and system claims required application of the same abstract idea analysis for both.  In this case, the question was whether "the limitations of the claim, including any computer-based limitations, add enough beyond the abstract idea itself to limit the claim to a narrower, patent-eligible application of that idea."  Viewing the "generic" computer structure recited by the claim sufficient to "encompass any device capable of performing the same ubiquitous calculation, storage, and connectivity functions required by the method claims," Judge Lourie found that they did not because this structure did not provide a significant "inventive concept."  Summing up, he wrote that:

We are not here faced with a computer per se.  Such are surely patent-eligible machines.  We are faced with abstract methods coupled with computers adapted to perform those methods . . . .  Abstract methods do not become patent-eligible machines by being clothed in computer language.

In order to properly seek protection of their inventions, Applicants need to understand the requirements of § 101.  Despite the plurality's cry for "a consistent, cohesive, and accessible approach to the § 101 analysis," at best, a handful of dirt has been tossed into already muddied waters.  Judge Lourie's procedures for § 101 analysis allow significant opportunities for subjectivity on the part of the fact finder.  As a result, an Applicant's best practice for obtaining suitable protection of its computer-implemented technologies remains unclear.  A more detailed discussion of the open questions coming out of this decision will be the subject of future posts.

CLS Bank Int'l v. Alice Corp. (Fed. Cir. 2013) (en banc)
Opinion for the court per curiam; concurring opinion by Circuit Judge Lourie, joined by Circuit Judges Dyk, Prost, Reyna, and Wallach; concurring-in-part and dissenting-in-part opinion by Chief Judge Rader, joined by Circuit Judge Moore, and by Circuit Judges Linn and O'Malley as to all but part VI of that opinion; dissenting-in-part opinion by Circuit Judge Moore, joined by Chief Judge Rader and Circuit Judges Linn and O'Malley; concurring-in-part and dissenting-in-part opinion by Circuit Judge Newman; dissenting opinion by Circuit Judges Linn and O'Malley; additional reflections by Chief Judge Rader.

The Myriad Case and "Gene" Patents: Much Ado about Nothing?

By Kevin E. Noonan --

The biggest concern of the biotechnology industry caused by the impending Supreme Court decision in the AMP v. Myriad Genetics case is the threat to existing patents having claims to isolated human DNA (and the DNA from other species) that a negative decision from the Court could raise.  Patent protection has been an important component of the success of companies from Genentech to Myriad and many others, and the prospect of a categorical ban (ironic, in view of the Court's anathema for "bright line" rules promulgated by the Federal Circuit) threatens the success paradigm developed over the past 30 years.  While the extent of whatever deleterious effects on the progress of the biotechnology arts that the Court may impose by its Myriad decision is still to come, an article in the May edition of Nature Biotechnology suggests that those effects may be ameliorated by the anachronistic aspects of the Myriad case:  in many ways this argument is coming 30 years to late, and the future of biotechnology is less dependent on so-called "gene patents" than at any other time in the history of the biotechnology industry.

The article, "Not quite a myriad of gene patents," by Gregory Graff, Devon Phillips, Zhen Lei, Sooyoung Oh, Carol Nottenburg, and Philip Pardey, provides a survey of existing patents claiming isolated human DNA.  After providing a brief history of the Myriad case, the paper provides data on the number of U.S. patents containing different types and extents of isolated human DNA:

• Patents that identify DNA or RNA "anywhere" in the patent document
• Patents that identify DNA or RNA in the claims (providing upper and lower estimates)
• Patents with at least one composition of matter claim directed to isolated DNA or RNA (numbering 15,359 patents according to these authors)

Previously published estimates of the number of such patents claiming human DNA vary widely, with a high of 40,000 from a National Research Council report to a emerging consensus of ~4,000 – 5,000 patents that claims isolated human DNA.  The paper also addresses the philosophical and practical consequences that could arise if the Court narrowly answered the Question Presented in a decision limited to human DNA, in contrast to DNA from other species.

The quantitative aspects of the paper involve an analysis of claim language in claims reciting isolated human DNA, thereby identifying 72,052 U.S. patents that "in some way identify or make reference to nucleotide sequences."  Of these, the authors report that from 30-39% of these patents (21,870 – 28,410 patents) were "likely to contain or refer to nucleotide sequences in at least one of the claims of the patent."  Finally, the paper identifies from this population patents that contain at least one composition of matter claim to an isolated human nucleic acid, which are reported to be 15,359 patents.  (As an interesting aside, there were 82,952 method claims in the 72,052 patents that recited human DNA or RNA.)  Of these 15,359 patents, 5,936 (39%) "primarily involve" isolated human DNA, with the remainder being directed to isolated DNA molecules from other animals (1,056; 7%); plants (1,847; 12%);  microbes (3,228; 21); and synthetic or artificial sequences (3,292; 21%).  (Methodologically, the authors considered claims to artificial or synthetic sequences to be "markedly different" from naturally occurring DNA and omitted these patents from further analysis.)

Looking at the timing of patents granted on isolated DNA, the authors report that the number of patents containing such claims peaked in 1999 and has been declining since 2005 (no doubt due to a combination of the more stringent utility requirements imposed by the U.S. PTO in 2001 and the change from isolating DNA encoding a particular protein and isolating human DNA containing an open reading frame as identified by genome sequencing efforts, predominantly related to the Human Genome Project).  The proportion of patents claiming isolated human DNA peaked in 2000, where 58% of "gene" patents recited human DNA, and by 2010 this percentage had fallen to 19%.

Of the patents containing claims to isolated DNA that could encompass "naturally occurring" molecules, the authors identified 8,703 that remain in force, with 3,535 (41%) of these patents claiming isolated human DNA and less than half of these patents being related to human medicine (an area about which at least Justice Breyer has evinced a particular concern on the possibility of negative effects of patenting on patient care).  The assignee data the authors report are a little surprising, with 65% of the 15,359 patents containing composition of matter claims reciting isolated DNA molecules being owned by private-sector commercial assignees, and only 24% being owned by public-sector (identified as "government, university, nonprofit") assignees (the remainder being owned by some combination of public- and private-sector assignees).  The "Top Twenty-five" assignees (and the number of patents assigned to them) are reported to be:

The authors speculate on the reason for the decline in patents claiming isolated nucleic acids, providing some clear correlations (the crash of the tech bubble at the turn of the century, the availability on public databases of human genomic DNA sequences and the prior art effect, and the more stringent utility requirements).  The authors also recognized that the 1999-2000 timeframe also marked a change from claims to isolated human DNA molecules per se to claims reciting "complex genetic constructs" (presumably including expression constructs).  The authors also note the trend over the past decade towards claims to molecules comprising artificial or synthetic sequences (from 14% to 40%) rather than "naturally occurring" DNA molecules (from 58% to 19%).  Nevertheless, the 3,535 patents claiming isolated human DNA remain at risk for invalidation to some extent by the Supreme Court's Myriad decision (and, the authors note, the remaining 4,538 patents claiming isolated DNA from other species might also be at risk if the Court rules more broadly).  Consequently:

[A]n overturn by the Supreme Court will affect claims of patents not only on human genetic diagnostics and therapeutics but also on a wide range of other genetic technologies in other industries, particularly in agriculture, based upon our analysis of top assignee portfolios.

The authors attempt to find a silver lining in their analyses, particularly with regard to sequence variants and genetically engineered constructs, which may have a greater likelihood to evince "the hand of man" and to be "markedly different" from naturally occurring DNA.  They perceive a trend towards this type of innovation that a "product of nature" exception from the Court would "accelerate," and more recent events (the PTO's decision to examine one sequence per invention and the Federal Circuit's expansion of obviousness towards isolated DNA in In re Kubin) are not accounted for in the data.  Thus:

The outcome of the Myriad case, regardless, is thus likely to be less profound than either abolitionists or advocates seem to expect.  In the end, any policy effects resulting from the Myriad case may prove to have been largely preempted by a combination of less dramatic changes in examination practices and patent law.

While outside the scope of the data presented in their paper, the authors also neglect to consider the effects of a broad "product of nature" ban by the Court on biotechnology more generally (a concern voiced by Judge Moore in oral argument and her concurring opinions in the Federal Circuit's review of the Myriad decision).  It is possible, as the authors posit, that the negative effects of whatever decision is handed down by the Court will be ameliorated by advances in DNA technology (and the capacity of competent patent draftsmen to adapt claiming strategies to accommodate their clients' needs in view of the Court's proscriptions).  But it is equally likely that the Court will seriously harm the economic incentives for commercializing genetic technology and inhibit disclosure of new correlations between disease and genetic variation, all to the detriment of progress in this industry.  And it is a near certainty that the purported purpose behind the controversy, better access to genetic testing for patients, will not be one of the outcomes of any decision that impairs the ability to commercializing genetic testing.  In the end, the question is not how many patents are at risk from the Court's consideration of the question before it, but rather why do the Justices not realize that now is not the time to wade unnecessarily into these particular philosophical waters.  It is ultimately a political, not a legal, question, and one better suited for consideration by the (expressly) political branches of the government.

Bowman v. Monsanto Co. (2013)

By Donald Zuhn --

Today, in Bowman v. Monsanto Co., the Supreme Court determined that the doctrine of patent exhaustion did not permit a farmer who buys patented seeds to repro­duce them through planting and harvesting without the patent holder's permission, affirming the Federal Circuit's decision that such activities amount to the creation of a newly infringing article.  Writing for a unanimous Court, Justice Kagan begins a concise 10-page opinion by noting that "[u]nder the doctrine of patent exhaustion, the authorized sale of a patented article gives the purchaser, or any sub­sequent owner, a right to use or resell that article," but that such sale "does not allow the purchaser to make new copies of the patented invention."

The case arose as the result of a farmer (Mr. Bowman) replanting Monsanto's patented Roundup Ready® seed.  Mr. Bowman had purchased the seed from one of Monsanto's licensed seed producers, with the sale being subject to a Technology Agreement that permitted Mr. Bowman to, inter alia, "use the seed containing Monsanto gene technologies for planting a commercial crop only in a single season" and "not save any crop produced from this seed for replanting, or supply saved seed to anyone for replanting."  While Mr. Bowman complied with these provisions with respect to a first planting, Mr. Bowman used cheaper "commodity seed" (i.e., seed obtained from local grain elevators) in a second planting.  After planting the commodity seed, Mr. Bowman tested the second crop for Roundup® resistance, and found that substantial amounts of the seed were resistant.  He then used Roundup® on these plantings and replanted this seed.  The District Court granted summary judgment of patent infringement and entered judgment against Mr. Bowman, and the Federal Circuit affirmed (see "Monsanto Co. v. Bowman (Fed. Cir. 2011)").

With regard to Mr. Bowman's argument that the doctrine of patent exhaustion prevented Monsanto from controlling his use of soybeans he obtained from the grain elevator be­cause they were the subject of a prior authorized sale (i.e., from local farmers to the grain elevator), Justice Kagan counters that "the exhaustion doctrine does not enable Bowman to make additional patented soybeans without Monsanto's permission" (emphasis in opinion).  Noting that the exhaustion doctrine restricts a patentee's rights only as to the particular article sold, the opinion indicates that the doctrine "leaves untouched the patentee's ability to prevent a buyer from making new copies of the patented item."  Justice Kagan explains that:

[This] is because the patent holder has "received his reward" only for the actual article sold, and not for subsequent recreations of it.  . . .  If the purchaser of that article could make and sell endless copies, the patent would effectively protect the invention for just a single sale.  Bowman himself disputes none of this analysis as a gen­eral matter:  He forthrightly acknowledges the "well set­tled" principle "that the exhaustion doctrine does not extend to the right to 'make' a new product."

"Unfortunately for Bowman," the opinion continues, "that principle decides this case against him."  As Justice Kagan notes, Mr. Bowman "took the soybeans he purchased home; planted them in his fields at the time he thought best; applied glyphosate to kill weeds (as well as any soy plants lacking the Roundup Ready trait); and finally harvested more (many more) beans than he started with."  Therefore, because Mr. Bowman reproduced Monsanto's patented invention, the opinion concludes that the ex­haustion doctrine does not protect him.

The opinion demonstrates an appreciation of the impact Mr. Bowman's activities would have on Monsanto if such activities were found to be protected under the exhaustion doctrine:

[I]n short order, other seed companies could reproduce the product and market it to growers, thus depriving Mon­santo of its monopoly.  And farmers themselves need only buy the seed once, whether from Monsanto, a competitor, or (as here) a grain elevator.  The grower could multiply his initial purchase, and then multiply that new creation, ad infinitum -- each time profiting from the patented seed without compensating its inventor.

With regard to Mr. Bowman's argument that he was merely using the Roundup Ready® seeds in the normal way that farmers do -- by planting them -- and that by interfering with that use, Monsanto was creating an impermissible exception to the exhaustion doctrine for patented seeds and other self-replicating technologies, Justice Kagan notes that "it is really Bowman who is asking for an unprece­dented exception -- to what he concedes is the 'well settled' rule that 'the exhaustion doctrine does not extend to the right to 'make' a new product."  Returning to the impact of Mr. Bowman's activities on Monsanto, the opinion states that:

[O]nce again, if simple copying were a protected use, a patent would plummet in value after the first sale of the first item containing the invention.  The undiluted patent monopoly, it might be said, would extend not for 20 years (as the Patent Act promises), but for only one transaction.  And that would result in less incentive for innovation than Congress wanted.  Hence our repeated insistence that exhaustion applies only to the particular item sold, and not to reproductions.

Justice Kagan concludes the opinion, however, by noting that the Court's holding "is limited -- addressing the situation before us, rather than every one involving a self-­replicating product."  She adds that:

We recognize that such inventions are becoming ever more prevalent, complex, and diverse.  In another case, the article's self-replication might occur outside the purchaser's control.  Or it might be a necessary but incidental step in using the item for another purpose.  . . .  We need not address here whether or how the doctrine of patent exhaustion would apply in such circumstances.

Bowman v. Monsanto Co. (2013)
Opinion of the Court by Justice Kagan

Court Report

By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases.

Bristol-Myers Squibb Co. v. Genentech, Inc. et al.
3:13-cv-02045; filed May 3, 2013 in the Northern District of California

• Plaintiff:  Bristol-Myers Squibb Co.
• Defendants:  Genentech, Inc.; City of Hope

Declaratory judgment of invalidity, unenforceability, and noninfringement of of U.S. Patent Nos. 6,331,415 ("Methods of Immunoglobulins, Vectors, and Transformed Host Cells for Use Therein," issued December 18, 2001) and 7,923,221 ("Methods of Making Antibody Heavy and Light Chains Having Specificity for a Desired Antigen," issued April 12, 2011) in conjunction with BMS's manufacture and sale of its Erbitux® product (cetuximab, used for the treatment of head and neck cancer and colorectral cancer; sold pursuant to an agreement with Eli Lilly) and its Yervoy® product (ipilimumab, used for the treatment of unresectable or metastatic melanoma).  View the complaint here.

Genentech, Inc. v. Rea
1:13-cv-00556; filed May 3, 2013 in the Eastern District of Virginia

Review and correction of the patent term adjustment calculation made by the U.S. Patent and Trademark Office for U.S. Patent No. 8,303,955 ("Humanized Anti-CD40 Antibodies and Their Methods of Use," issued November 6, 2012).  View the complaint here.

Conference & CLE Calendar

May 13-14, 2013 - Generics and Patent Strategies (SMi) - London, UK

May 14, 2013 - Forum on Pharma & Biotech Collaborations (C5 (UK)) - Frankfurt, Germany

May 14-16, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - Chicago, IL

May 15-16, 2013 - Forum on Freedom to Operate (C5 (UK)) - Frankfurt, Germany

May 21-23, 2013 - Pharma Legal Affairs (IBC Life Sciences) - Shanghai, China

May 27, 2013 - A Harmonized Patent World -- Are We Getting There? (Intellectual Property Owners Association) - Brussels, Belgium

May 29, 2013 - AIA and Patent Due Diligence Understanding the AIA Impact and Best Practices for the Due Diligence Process (Strafford) - 1:00 - 2:30 pm (ET)

May 30, 2013 - Harmonization of USPTO Ethical Standards in the Post-AIA Era (McDonnell Boehnen Hulbert & Berghoff LLP) - 10:00 - 11:15 am (CT)

June 5-7, 2013 - Advanced Forum on Biosimilars (American Conference Institute) - New York, NY

June 9-11, 2013 - IP Business Congress (Intellectual Asset Management) - Boston, MA

June 12-14, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - New York, NY

July 15-19, 2013 - Patent Law Summer Intensive (Benjamin N. Cardozo School of Law) - New York, NY

June 25-26, 2013 - Maximising Pharma Patents (C5 (UK)) - London, England

July 10-12, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - San Francisco, CA

***Patent Docs is a media partner of this conference or CLE

Webinar on New USPTO Rules of Professional Conduct

McDonnell Boehnen Hulbert & Berghoff LLP will be offering a live webinar entitled "Harmonization of USPTO Ethical Standards in the Post-AIA Era" on May 30, 2013 from 10:00 am to 11:15 am (CT).  MBHB attorney and Patent Docs contributor Dr. Andrew Williams will moderate a presentation by Director William R. Covey, Deputy General Counsel and Director for Office of Enrollment and Discipline at the U.S. Patent and Trademark Office, on the new USPTO Rules of Professional Conduct.  Director Covey's presentation will address the new rules, and focus on present day ethical issues affecting attorneys and agents who practice before the USPTO and are therefore subject to the jurisdiction of the OED.  Topics/issues to be covered include:

• Ethical standards under the New USPTO Rules of Professional Conduct, modeled on the ABA's Model Rules of Professional Conduct.
• Mechanics of OED's complaint and investigative process.
• Ethical impact of the AIA on practitioners and OED.
• Practical examples and statistics relating to OED enforcement.

While there is no fee to participate, attendees must register in advance.  Those wishing to register can do so here.  CLE credit is pending for the states of California, Georgia, Illinois, North Carolina, New Jersey, New York and Virginia.

Cardozo School of Law Patent Law Summer Intensive

The Benjamin N. Cardozo School of Law will host its first Patent Law Summer Intensive for students and practitioners on July 15-19, 2013.  The week-long program will have two components -- participants may enroll in one or both components.  The morning component will be an intensive 15-hour course called Introduction to Patent Law which will focus on the law of patent validity and infringement in the United States.  The afternoon component, also 15 hours, will feature lectures, panels, and exercises on current topics in patent law and practice.  The afternoon course will be keyed to, but independent from, the morning course.

The Patent Law Summer Intensive will be co-taught by Professor Michael Burstein and Professor Daniel Ravicher.  The registration fee for the course is $3,000 ($1,800 for morning or afternoon only), excluding a $75 application fee (note: discounted prices for students currently enrolled in J.D. or LL.M. programs).  Those interested in registering for the course can do so here (note: the application deadline is May 15, 2013).  Additional information regarding the Patent Law Summer Intensive, including a list of the topics being covered in the course, can be obtained here or by e-mailing nysummer@yu.edu.

IP Business Congress 2013

Intellectual Asset Management (IAM) magazine will be hosting its 6th annual IP Business Congress on June 9-11, 2013 in Boston, MA.  The IP Business Congress brings together senior thought leaders who specialize in the business of IP to come together to discuss cutting-edge issues around IP value creation.  Among the plenary and breakout sessions being offered are:

• The changing face of the IP market
• Strategic insights
• IPBC Debate 1 -- Patent reform in the US
• Measuring success
• Opportunities beyond the US
• A new value creation framework for biotech and pharma
• Evolving monetisation models
• Tomorrow's IP
• CIPO masterclass
• IPBC Debate 2 – CIPO issues
• Investment and deal making
• Using your IC to enhance your IP
• On the shoulders of giants
• Strategic priorities

The programme for the IP Business Congress can be found here.

The registration fee for the IP Business Congress is $1,650 (rate available until June 8, 2013).  Those interested in registering for the conference can do so here.  More information about the IP Business Congress can be found here.

Senators Back 12-Year Data Exclusivity Period for Biosimilars and President Obama (Once Again) Does Not

By Donald Zuhn --

On March 22, Senators Max Baucus (D-MT) and Orrin Hatch (R-UT), the Chairman and Ranking Member, respectively, of the Senate Committee on Finance, sent a letter to Ambassador Demetrios Marantis, the Acting United States Trade Representative, "to emphasize the importance of achieving a comprehensive, high-standard intellectual property chapter" as negotiations on the Trans-Pacific Partnership Agreement enter a "crucial phase."  The Trans-Pacific Partnership Agreement, or TPP, is a multilateral free trade agreement currently being negotiated by Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, the United States, and Vietnam (Canada, Japan, the Philippines, South Korea, and Taiwan have also expressed interest in participating in the agreement).  The 17th round of TPP negotiations will be held in Lima, Peru on May 15-24.

While expressing their "strong[] support" for the Acting U.S. Trade Representative's "commitment to 'aggressively protect' intellectual property through international trade negotiations," Senators Baucus and Hatch specifically urged the Acting U.S. Trade Representative "to seek commitments from our trading partners that reflect the level of protection under U.S. law, for example 12 years of regulatory data protection for biologic pharmaceuticals and strong remedies, including civil and criminal penalties, for trade secret theft."  The Senators concluded their letter by noting that "[g]iven the significance of the TPP, and with countries like China and India watching closely, the United States cannot afford to get this wrong."

In urging the Acting U.S. Trade Representative to include a 12-year data exclusivity period in the TPP, Senator Hatch reaffirmed his support for this provision of the Biologics Price Competition and Innovation Act (BPCIA), the portion of the Patient Protection and Affordable Care Act that provides an approval pathway for biosimilar biological products.  Senator Hatch and two other members of the Senate Health, Education, Labor and Pensions Committee proposed an amendment to the Senate biosimilar bill in July 2009 that provided the 12-year data exclusivity period (see "Senators Champion 12-Year Data Exclusivity in Senate").  In the fall of 2011, 37 Senators, led by Senators Hatch and John Kerry, sent a letter to the U.S. Trade Representative Ron Kirk, stating that "[w]hile the views of individual members of Congress may differ as to the desirability of [the TPP] negotiations, we are united in urging you to propose a strong minimum term of regulatory data protection for biologics consistent with U.S. law" (see "Senators Support Inclusion of 12-Year Exclusivity Period in Free Trade Agreement").  In that letter, the Senators noted that "U.S. law provides for a 12-year term of regulatory data protection for biologics," and declared that this 12-year period "should serve as the baseline for the administration's objectives for this aspect of the negotiation."

Chances are that the Acting U.S. Trade Representative, a Cabinet member who serves as the president's principal trade advisor, negotiator, and spokesperson on trade issues, may the views of Senators Baucus and Hatch when it comes to the 12-year data exclusivity period.  That is, if the President's FY 2014 budget proposal is any indication.  The President's latest budget proposal, which was unveiled last month, looks a lot like his 2013 and 2012 proposals with respect to provisions that would impact the data exclusivity period (see "President's Latest Budget Proposal Seeks Decrease of Data Exclusivity Period and Elimination of Pay-for-Delay Agreements" and "President's Budget Proposal Increases Funding for Basic Research But Seeks to 'Trim' Data Exclusivity Period and Pay-for-Delay Agreements").  In particular, the President's budget proposal states:

Lower Drug Costs.  The Budget includes a number of policies to lower drug costs to taxpayers and consumers.   . . .  The Budget also proposes to accelerate access to affordable generic biologics by modifying the length of exclusivity on brand name biologics.  Beginning in 2014, this proposal would award brand biologic manufacturers seven years of exclusivity, rather than 12 years under current law, and prohibit additional periods of exclusivity for brand biologics due to minor changes in product formulations, a practice often referred to as "evergreening."  The proposal will result in $3 billion in savings over 10 years to Federal health programs including Medicare and Medicaid.

As in his last two budget proposals, the President's FY 2014 budget would also put an end to pay-for-delay, or reverse payment, agreements.  Specifically, the President's budget proposal states that:

[B]eginning in 2014, the Budget proposes to increase the availability of generic drugs and biologics by authorizing the Federal Trade Commission to stop companies from entering into anti-competitive deals, known also as "pay for delay" agreements, intended to block consumer access to safe and effective generics.  Such deals can cost consumers billions of dollars because generic drugs are typically priced significantly less than their branded counterparts.  The Administration's proposal will generate $11 billion over 10 years in savings to Federal health programs including Medicare and Medicaid.

Inovia Releases 2013 Report on Global Patent Trends

By Donald Zuhn --

Patent services provider inovia announced the release of its 2013 report on global patent and IP trends today.  In compiling the report, inovia, which produces products for PCT national phase entry, European patent validation, and patent translations, surveyed 125 U.S. companies and universities in January 2013 to identify the trends having the greatest impact on the foreign filing strategies of U.S. patentees.

The 2013 report notes that 23% of survey respondents are involved in the pharmaceuticals, biotech, or medical devices industries.  Other sectors or groups represented in the survey include chemicals/materials (13%), electrical/electronics (10%), mechanical/engineering (10%), IT/software/media (7%), and university/association/non-profit (18%).  The report also indicates that one-third of survey respondents (33%) had no in-house patent attorneys or agents, 47% had one to four in-house patent attorneys or agents, and the remainder (20%) had five or more attorneys or agents.  With respect to the number of in-house patent attorneys or agents, the trend was towards increasing numbers of in-house practitioners (the 2012 report indicated that 37% of survey respondents had no in-house patent attorneys or agents, 46% had one to four in-house patent attorneys or agents, and 17% had five or more attorneys or agents).

The report states that among survey respondents, "[t]he theme of 'cautious optimism' from previous surveys continues."  The report notes, however, that "respondents don't foresee too much growth in terms of the number of patent families expected to be filed in 2013."  Fewer respondents experienced IP budget cuts in 2012 than in 2011, and a greater percentage brought in in-house support or outsourced annuity payments.  Half of respondents cited final implementation of the Leahy-Smith America Invents Act as the most important issue/trend of 2013.  Other key trends for 2013 included cost containment, the rising cost to obtain patent protection, as well as enforcement and patent trolls.

With respect to application filings, 11% of survey respondents said they filed more patent applications in 2012 than they expected (down from 18% in 2011), 16% said they filed fewer patent applications (up from 15% in 2011), and 73% said they filed as many patent applications in 2012 as they expected (up from 67% in 2011).  The results of this year's survey, however, were a significant improvement over those from inovia's first survey (released in 2010), where 41% of respondents said they filed fewer applications than expected in 2009.

The 2013 report indicates continued growth for international patent protection, as 50% of respondents filed more than half of their patent applications abroad (up from 42% in last year's report).  Respondents, however, are even more selective with their filings abroad, with 22% of respondents filing corresponding applications in only 1-3 foreign countries and another 32% filed internationally in 4-19 countries (the 2012 report indicated that 37% of respondents filed corresponding applications in 1-3 foreign countries and another 42% filed internationally in 4-8 countries; this year's survey did not provide a breakdown of the percentage of respondents filing in 4-8 countries).

With regard to the countries in which respondents regularly filed, 23% added new countries to their list (up from 21% in 2011 and 17% in 2010), with 14% adding China and smaller percentages adding South American countries, India, South Africa, South Korea, and Japan.  Noting that 28% of respondents added China to their list in 2011, the report stated that the drop could be an indication that China is now a regular filing destination for many U.S. applicants.  A smaller percentage of respondents (19%) dropped countries from their lists (up from 17% in 2011), with the European Patent Office or individual European countries being dropped by 24% of respondents who pared down their lists, 10% dropping China, Japan, and Mexico, and 7% dropping Australia, Canada, South Korea, and Russia from their lists.  Respondents who dropped the European Patent Office or individual European countries believed that the high cost of pursuing such protection did not justify the value.  In ranking foreign jurisdictions, respondents placed Europe, China, and Japan first, second, and third, respectively, which was the same ranking respondents provided in last year's report.

Finally, the report noted that a large majority of respondents (99%) rely on the PCT for foreign filing.  Of these respondents, 75% selected the EPO as an International Searching Authority (up from 72% in 2011), 50% selected the Korean IP Office (KIPO) (up from 42% in 2011), and 11% selected the Japan Patent Office (JPO) (down from 12% in 2011).

Rubin v. General Hospital Corp. (Fed. Cir. 2013)

By Donald Zuhn --

On March 28, the Federal Circuit in Rubin v. General Hospital Corp. affirmed judgment by the District Court for the District of Massachusetts dismissing the suit brought by Drs. Berish Rubin and Sylvia Anderson against The General Hospital Corporation requesting correction of U.S. Patent Nos. 7,388,093 and 7,407,756, which are assigned to General Hospital.  The '093 and '756 patents are directed to genetic mutations that cause the inherited disease Familial Dysautonomia (FD), also known as Riley-Day Syndrome, and methods for detecting FD.

Drs. Rubin and Anderson at the Department of Biological Sciences of Fordham University, and Drs. Slaugenhaupt and Gusella at Massachusetts General Hospital, had been independently conducting research to determine the genetic mutations disclosed in the '093 and '756 patents.  Drs. Rubin and Anderson identified two mutations in the gene encoding IkB kinase complex-associated protein that cause FD, and on December 20, 2000, submitted a paper describing these mutations to the American Journal of Human Genetics.  When submitting the paper, Dr. Rubin asked the Editor of the journal to not send the paper to Dr. Gusella and his colleagues at Mass General for peer-review.  On December 22, 2000, the Editor sent the abstract for the paper to Dr. Gusella.  Dr. Gusella declined to review the full paper, and on December 28, 2000, Drs. Gusella and Slaugenhaupt submitted their own paper identifying the same two mutations to the same journal (as of October 2000, Dr. Gusella had noted that his group had identified 184 candidate mutations, and as of December 12, 2000, further noted that the responsible mutations had not yet been identified).  Both papers were published in the January 22, 2001 issue of the journal.

On January 6, 2001, Drs. Gusella and Slaugenhaupt filed a provisional application describing the two mutations and claiming their diagnostic use.  On January 17, 2001, Drs. Rubin and Anderson filed their own provisional application describing the two mutations and claiming their diagnostic use.  The application filed by Drs. Gusella and Slaugenhaupt eventually resulted in the issuance of the '093 and '756 patents.  During prosecution of their application, Drs. Rubin and Anderson decided not to initiate an interference in the U.S. Patent and Trademark Office, despite the examiner's suggestion that they do so.

Rather than initiate an interference, Drs. Rubin and Anderson filed suit against Mass General seeking correction of inventorship of the '093 and '756 patents under 35 U.S.C. § 256.  They argued that Dr. Gusella's receipt of their abstract permitted Dr. Gusella's group to select and confirm the identity of the FD mutations and file their provisional patent application, and Drs. Rubin and Anderson asked to be substituted as the inventors of the '093 and '756 patents, or added as joint inventors.  Granting Mas General's motion for summary judgment, the District Court held that the inventorship could not be changed under § 256 because there was no "collaboration" between the two teams of scientists, and that Drs. Rubin and Anderson could not be added as joint inventors because they did not meet the requirements of § 116 for joint invention.  With respect to the correction of inventorship, the District Court also held that the complete substitution of inventorship is not a matter for § 256, but rather, is a claim for priority of invention of the subject matter, and priority should be resolved in an interference, not under § 256.

On appeal, the Federal Circuit determined that "the district court correctly ruled that the independent relationship between these teams of scientists, and the nature of this communication of information, do not support joint invention in accordance with §116, or warrant change or substitution of inventorship under §256."  The panel added that:

We agree with the district court that, whatever actions were taken after the Rubin/Anderson Abstract appeared uninvited on Dr. Gusella's desk, ultimately the dispute is of priority of invention; that is, which team was the first to conclusively identify the operative mutations.  The district court recognized that even if Drs. Gusella and Slaugenhaupt had completed this identification before they saw the Rubin/Anderson identification, it would still be necessary to determine priority of invention in order to resolve the patent rights.

The panel, therefore, concluded that the District Court acted within its authority in directing the parties to the USPTO to determine priority of invention, and affirmed the District Court's judgment of dismissal.

Rubin v. General Hospital Corp. (Fed. Cir. 2013)
Nonprecedential disposition
Panel: Circuit Judges Newman and Bryson and District Judge Fogel
Opinion by Circuit Judge Newman

Dawson v. Dawson (Fed. Cir. 2013)

By Donald Zuhn --

On March 25, the Federal Circuit in Dawson v. Dawson affirmed a determination by the Board of Patent Appeals and Interferences that the University of California, San Francisco (UCSF) failed to establish sole conception by Dr. Chandler Dawson of the claimed inventions in two patents assigned to InSite Vision Inc.  The case involved an interference between two patents, U.S. Patent Nos. 6,239,113 and 6,569,443, which name Dr. Dawson and Dr. Lyle Bowman as inventors and which are assigned to InSite, and an application which names Dr. Dawson as the sole inventor and which is assigned to UCSF.  The patents and application ay issue are directed to a method for topically treating and preventing infections of the eye.

In 1997, at a meeting of the World Health Organization Alliance for the Elimination of Trachoma, Dr. Dawson, who was employed by UCSF, gave a presentation on the topical use of an antibiotic called azithromycin (at right) to control trachoma (a bacterial infection of the eye).  A report of the meeting ("WHO Report") was subsequently released, which included a discussion of Dr. Dawson's presentation.  A second document ("WHO document"), which may have been an outline of Dr. Dawson's presentation, provided a similar discussion of the presentation.

Shortly after the meeting, Dr. Dawson asked Dr. Kenneth Chern to enlist the assistance of Dr. Bowman, an employee at InSite (a company involved in the research and development of ophthalmic products), in creating a suitable ophthalmic medication with azithromycin that could be applied topically to the eye.  Dr. Chern sent 100 mg of azithromycin to Dr. Bowman for formulating as a topical preparation.  Three weeks later, after not hearing back from Dr. Bowman, Dr. Chern sent azithromycin to Dr. Charles Leiter, a pharmacist associated with the same foundation as Dr. Chern, to formulate as an ointment or suspension.  Dr. Leiter prepared an ointment using a mineral oil and petrolatum carrier and containing 0.5% azithromycin by weight.  Upon receipt, Dr. Chern applied some of the ointment to his own eye to determine whether it could be well-tolerated, and informed Dr. Dawson of the results of his experiment.  Dr. Dawson subsequently left UCSF to work at InSite, and after joining InSite, was named with Dr. Bowman on a patent application that led to the issuance of the '113 and '443 patents.

Almost four years after the '443 patent issued, UCSF filed a patent application naming Dr. Dawson as an inventor, and copying the specification and claims from both the '113 and '443 patents in order to provoke an interference.  The BPAI declared two interferences between the InSite patents and UCSF's application, naming UCSF as the junior party (and therefore UCSFD bore the burden of proving, by a preponderance of the evidence, that Dr. Dawson alone had conceived of the inventions recited in the counts prior to InSite's March 31, 1999 filing date).  The count in Interference 105,719, which tracks claim 3 of the '113 patent, recites:

A process for treating an eye, which comprises:
    topically applying an aqueous polymeric suspension of an azalide antibiotic, wherein said suspension comprises water,
    0.01% to 1.0% of an azalide antibiotic, and
    0.1 to 10% of a polymeric suspending agent which is a water-swellable water-insoluble cross-linked carboxy-vinyl polymer which comprises at least 90% acrylic acid monomers and 0.1% to 5% crosslinking agent.

The count in Interference 105,729, which tracks claim 1 of the '443 patent, recites:

A process for treating an eye, comprising:
    topically applying an azalide antibiotic to an eye in an amount effective to treat infection in a tissue of the eye, wherein said topically applying comprises supplying a depot of a composition containing said azalide antibiotic on the eye.

On the issue of conception, the Board determined that UCSF had failed to prove sole conception by Dr. Dawson, finding that that Dr. Dawson did not fully appreciate how his idea was to be implemented in actual practice, and that it was only after Dr. Bowman became involved that "'something' significant happened," leading to the March 1999 filing of Dr. Dawson's and Dr. Bowman's application.  UCSF appealed the Board's decision, contending the Board erred in finding that Dr. Dawson did not conceive of the claimed inventions by himself prior to his collaboration with Dr. Bowman.

In a majority opinion written by Judge Bryson and joined by Judge Wallach, the Federal Circuit began by noting "that the nature of the evidence presented in this case is unusual," as the Court was "asked to decide whether and when an invention formed definitely, permanently, and particularly in the mind of the alleged inventor, but to do so without any testimony from the supposed inventor himself."  Instead of providing testimony from Dr. Dawson, UCSF contended that the WHO Report and the WHO document prove Dr. Dawson's conception, and that Dr. Leiter's preparation of an ointment for Dr. Chern provided further corroboration.  The Court, however, disagreed with UCSF's contention, stating that "[a]t best, . . . the WHO Report and WHO document announce a general idea, acknowledge many of the difficulties associated with making that idea operative, and offer some thoughts on how one might proceed (including by listing a few potential delivery vehicles)."  The Court explained (citations omitted) that:

The WHO document is entitled "Potential Use of Topical Azithromycin in Trachoma Control Programmes," and the WHO Report describes Dr. Dawson's presentation as a "preliminary report on the possibility of developing a topical application of azithromycin," while "recommend[ing] that [Dr.] Dawson continue to work with [others] to develop a topical application and report back at the next meeting."  A "preliminary" statement about a "possibility" or "potential use," alongside a recommendation for continued work and a "report back" in the future, falls short of a "'definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice.'"

Stating that "[t]he inadequacy of UCSF's showing is equally clear in the context of the specific interference counts," the Court noted that UCSF's evidence failed to establish conception of the specific concentrations in the '719 count, and further, that UCSF failed to establish that Dr. Dawson on his own determined "an amount effective to treat infection in a tissue of the eye" as recited in the '729 count.

The Court also noted that the ointment prepared by Dr. Leiter for Dr. Chern did not establish that Dr. Dawson alone conceived of the subject matter of the counts because "[t]here is no evidence that Dr. Dawson instructed Dr. Chern to contact Dr. Leiter or otherwise had any direct connection to the preparation of the ointment."

On appeal, UCSF argued that the Board's decision on conception was infected by several errors in claim construction and admission of evidence.  In response to UCSF's argument that the preamble of the '719 count should not have been read as limiting, and that treatment can be proactive and can thus occur absent an active infection, the Court countered that "[t]he proper meaning and scope of the preamble . . . is irrelevant to our conclusion that UCSF failed to prove sole conception by Dr. Dawson."  In response to UCSF's argument that the Board erred in considering statements from the specifications of the '113 and '443 patents on the ground that those statements were inadmissible hearsay, the Court noted that "UCSF adopted the words in the '113 and '443 patents as its own when it 'copied' those words into the patent application that provoked these interferences."  In response to USCF's argument that the Board erred by failing to consider statements made by InSite in an opposition to a European patent application concerning the topical use of azithromycin (InSite had stated in opposition proceedings that the WHO document "disclos[es] . . . why topical azithromycin preparations for eye treatment are highly desirable" and provides "a concrete disclosure [of] how such preparations can be obtained" and "suggestions [on] how [they] could be made"), the Court determined that the Board did not abuse its discretion by following its general rule against giving controlling weight to documents from foreign patent proceedings.  The Court also pointed out that the Board had properly noted that the instant case involved the issues of conception and reduction to practice and not lack of novelty or inventive step, the latter of which were at issue in the opposition.

Writing in dissent, Judge Reyna stated that:

The record before us demonstrates that Dr. Dawson possessed a definite and permanent idea of his complete and operative invention when, in the summer of 1997, he delivered a related presentation at a conference of the World Health Organization ("WHO").  At that time, Dr. Dawson was employed by UCSF, not InSite.  Consequently, I find that Dr. Dawson, through UCSF, satisfied his burden of demonstrating prior conception.

The dissent continued by asserting that the WHO Report and WHO document teach each of the limitations of the '729 count, and establish that he had possession of each recited feature.  In particular, the WHO references disclose (1) treating an eye, (2) topically applying an azalide antibiotic (i.e., azithromycin) (3) an effective dose ("Dr. Dawson suggested that his azithromycin formulation would use the same dosage known for erythromycin," and the dose "0.5% by weight[] is used throughout Dr. Dawson's patent as a preferred formulation), (4) supplying a depot containing the azalide antibiotic ("[b]oth references contain the same table listing five alternative delivery depots, one of which is [InSite's] Durasite").  The dissent concluded that "Dr. Dawson's WHO presentation and the accompanying report disclose each element of at least the '729 count, and as such, the two WHO references are sufficient to demonstrate Dr. Dawson's prior conception."

With respect to Dr. Chern's experiment with Dr. Leiter's ointment, the dissent explained that:

In the interference proceeding, the Board considered whether Dr. Chern's experiment showed reduction to practice before the critical date.  The Board held that Dr. Chern's experiment could not be reduction to practice because Chern had not applied the ointment to an actual infection.  The Board based its determination on its construction of "treating" an eye, which it construed as "retarding or suppressing infection in a tissue of" an eye.  Because Dr. Chern had not applied the ointment to treat an actual infection, the Board held that Dr. Chern did not reduce Dr. Dawson's invention to practice.  The Board erred in two fundamental aspects.  First, the term "treating an eye" in the preamble of the count is not limiting.  Second, "treating an eye" does not require an actual infection.

The dissent concluded by stating that:

The question is:  because Dr. Dawson's WHO presentation demonstrated conception and Dr. Chern's experiment demonstrated reduction to practice, what is left to establish inventorship?  The majority opinion leaves open for interpretation whether commercialization is required for full conception.

But conception does not require commercialization, nor does commercialization establish initial invention.  On the contrary, the record shows that Dr. Dawson conceived his invention at UCSF.  He turned to Dr. Bowman at InSite only for assistance in commercializing his invention.

Dawson v. Dawson (Fed. Cir. 2013)
Panel: Circuit Judges Reyna, Bryson, and Wallach
Opinion by Circuit Judge Bryson; dissenting opinion by Circuit Judge Reyna

Court Report

By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases.

Eisai R&D Management Co., Ltd. v. Rea
1:13-cv-00548; filed May 2, 2013 in the Eastern District of Virginia

Review and correction of the patent term adjustment calculation made by the U.S. Patent and Trademark Office for U.S. Patent No. 8,304,548 ("Method for Producing 1, 2-dihydropyridine-2-one Compound," issued November 6, 2012).  View the complaint here.

The Medicines Company v. Apotex Inc. et al.
3:13-cv-02801; filed May 1, 2013 in the District of Court of New Jersey

• Plaintiff:  The Medicines Company
• Defendants:  Apotex Inc.; Apotex Corp.

Infringement of U.S. Patent Nos. 7,582,727 ("Pharmaceutical Formulations of Bivalirudin and Process of Making the Same," issued September 1, 2009) and 7,598,343 (same title, issued October 6, 2009) following a Paragraph IV certification as part of Apotex's filing of an ANDA to manufacture a generic version of The Medicines Company's Angiomax® (bivalirudin, used as an anticoagulant in patients with unstable angina undergoing percutaneous translurninal coronary angioplasty).  View the complaint here.

Acura Pharmaceuticals Inc. v. Ranbaxy Inc. et al.
1:13-cv-00750; filed April 29, 2013 in the District of Court of Delaware

• Plaintiff:  Acura Pharmaceuticals Inc.
• Defendants:  Ranbaxy Inc.; Ranbaxy Laboratories Ltd.

Infringement of U.S. Patent No. 7,510,726 ("Methods and Compositions for Deterring Abuse of Opioid Containing Dosage Forms," issued March 31, 2009) following a Paragraph IV certification as part of Ranbaxy's filing of an ANDA to manufacture a generic version of Oxecta® (oxycodone hydrochloride, used for the management of acute and chronic moderate to severe pain where the use of an opioid analgesic is appropriate, marketed by Pfizer).  View the complaint here.

Par Pharmaceutical, Inc. et al. v. Takeda Pharmaceutical Co., Ltd. et al.
3:13-cv-01927; filed April 26, 2013 in the Northern District of California

• Plaintiffs:  Par Pharmaceutical, Inc.; Handa Pharmaceuticals, LLC
• Defendants:  Takeda Pharmaceutical Co., Ltd.; Takeda Pharmaceuticals North America, Inc.; Takeda Pharmaceuticals America, Inc; Takeda Pharmaceuticals U.S.A., Inc.

Declaratory judgment of non-infringement and invalidity of U.S. Patent Nos. 8,105,626 ("Granules Containing Acid-Unstable Chemicals in Large Amount," issued January 31, 2012) and 8,173,158 ("Methods of Treating Gastrointestinal Disorders Independent of the Intake of Food," issued May 8, 2012) in conjunction with Par and Handa's filing of an ANDA to manufacture a generic version of Takeda's Dexilant® (dexlansoprazole, used for the treatment of all grades of erosive esophagitis, maintaining healing of esophagitis, and treating heartburn associated with symptomatic non-erosive gastroesophageal reflux disease).  View the complaint here.

Conference & CLE Calendar

May 7-8, 2013 - Paragraph IV Disputes (American Conference Institute) - New York, NY

May 13-14, 2013 - Generics and Patent Strategies (SMi) - London, UK

May 14, 2013 - Forum on Pharma & Biotech Collaborations (C5 (UK)) - Frankfurt, Germany

May 14-16, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - Chicago, IL

May 15-16, 2013 - Forum on Freedom to Operate (C5 (UK)) - Frankfurt, Germany

May 21-23, 2013 - Pharma Legal Affairs (IBC Life Sciences) - Shanghai, China

May 27, 2013 - A Harmonized Patent World -- Are We Getting There? (Intellectual Property Owners Association) - Brussels, Belgium

May 29, 2013 - AIA and Patent Due Diligence Understanding the AIA Impact and Best Practices for the Due Diligence Process (Strafford) - 1:00 - 2:30 pm (ET)

June 5-7, 2013 - Advanced Forum on Biosimilars (American Conference Institute) - New York, NY

June 12-14, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - New York, NY

June 25-26, 2013 - Maximising Pharma Patents (C5 (UK)) - London, England

July 10-12, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - San Francisco, CA

***Patent Docs is a media partner of this conference or CLE

A Perspective on the Cost of the Myriad BRCA Gene Test

By Kevin E. Noonan --

One of the most compelling arguments in the gene patenting debate with the public has been the cost of the Myriad BRCA gene test:  $3,000 per test, a price that many without insurance coverage cannot afford.  The argument rarely is embedded within a comparison with other tests, and is presented as an absolute indication of Myriad's greed and the putative pernicious effects of permitting patents on such testing.  But an article in the New York Times published last Saturday sheds some light on the question in a way that might surprise anti-gene patenting partisans.

The article, "Variations on a Gene, and Tools to Find Them," by Anne Eisenberg, is concerned with gene testing of patient tumor samples to improve diagnosis and treatment.  It begins by noting the sea change that cancer genomics has effected on diagnostic criteria:  while in the past, cancers were characterized by tissue type and morphology, in recent years ("in the age of genetically informed medicine"), the identities of mutated or disordered genes provides more specific information that can be used to craft treatment strategies.  An example noted in the article is BRAF V600E (a mutation in the B-raf gene than changes a valine to an glutamic acid residue at amino acid 600 in the protein's amino acid sequence) in melanoma.  But the article also recognizes the complexities that this information creates, quoting Vanderbilt University oncologist Dr. William Pao that "[t]here are so many genes and so many mutations . . . .  The human brain can't memorize all those permutations."

Dr. Pao is highlighted in the article for his work in creating an online database, My Cancer Genome, which lists mutations found to be associated with different cancer types and therapies (experimental and FDA-approved) that can be used against these specific tumor types.  The article notes that the site "is maintained by 51 contributors from 20 institutions" and that users (physicians) are not charged for the service, the site being "supported almost entirely by [Vanderbilt U]niversity and by philanthropy."  This is not the whole story, of course, because (as stated in the article) "[b]efore doctors go to My Cancer Genome or a similar site, their patients must have a diagnostic test to find relevant mutations."  The advent of commercial genome sequencing services has made this testing "available to neighborhood doctors" after years when such tests were available "mainly to patients at large university cancer centers, and were often hard to interpret," according to Dr. Fadi Braiteh, an oncologist at Comprehensive Cancer Centers of Nevada in Las Vegas.

This is the point in the article that begins to have specific relevance to the issue of Myriad's BRCA testing costs.  Dr. Braiteh is quoted in the article as using a test, FoundationOne, from Foundation Medicine in Cambridge, Mass.  The cost:  $5,800.  Another example cited in the article is Genomic Health, which provides a test for determining the best chemotherapeutic options for patients with breast cancer.  The cost:  $4,290.  These costs are justified in the article by the successes they have enabled:  while admitting that the information doesn't help every patient, doctors are quoted as advocating the use of these tests, for example, because in one patient the doctors "were able to give a drug [] never used before for this mutation" that was effective in treating the patient's otherwise therapy-resistant cancer.

There are a few things that need to be considered from this information about these tests, not only that they are even more costly than the Myriad BRCA gene test.  First, these tests are given to individuals already diagnosed with cancer, and are used to direct treatment decisions.  Thus, there is little to no need to provide genetic counseling to the patients, or to convince insurers of the benefits of the testing -- these patients are already recognized as being sick, and any treatment that is effective will almost assuredly reduce the costs the insurers will need (or be required) to pay.  Also, the testing is being performed in 2013, 16 years after the BRCA gene patents were granted and Myriad began to develop genetic testing for the BRCA genes.  This type of genetic testing is now both widespread and accepted both by doctors and insurers (to some extent at least), public and private.  It must be remembered that in 1997 genetic testing was in its infancy, and companies like Myriad were under the burden to convince payors that the tests did the one thing that all insurers, public or private, require of such tests:  save them money in the long run, by identifying patients with a high probability of becoming ill and costing the insurers much more for treatment than the costs of prophylaxis.  Moreover, Myriad and like companies needed to convince doctors that the testing was worthwhile, and to establish a network of genetic counselors who could explain to healthy women that they were at much greater risk of developing breast or ovarian cancer than normal, under circumstances that resulted in empowerment from the information and not abject fear.  And in 1997, genetic sequencing technology was not as developed as it is now, and the mechanisms and techniques needed to minimize or eliminate the occurrence of false positives or negatives had not been conclusively established.

The question of whether $3,000 a test is what is required to provide an appropriate return on investment to Myriad's investors is beyond our scope, and the extent to which what Myriad, Foundation Medicine or Genome Health charge for its tests is an indictment of the U.S. healthcare system cannot be definitively determined here.  But it is clear that Myriad's costs are in line with what other genetic diagnostic test providers charge for their tests, and that the efforts to demonize Myriad for these costs is at best uninformed.  It remains to be seen whether the touted "$100 BRCA test" will be provided by those who perform this testing when Myriad's patents expire in the next few years (whether or not the ACLU prevails in its attempt to have the Supreme Court ban gene patenting).  The information in Ms. Eisenberg's article indicates that such an outcome is unlikely.

Allergan, Inc. v. Sandoz Inc. (Fed. Cir. 2013)

By Andrew Williams --

Can a method of treatment claim be inherent in the prior art if neither the formulation nor the method of using the formulation twice a day were in the prior art?  Earlier today,  the Federal Circuit determined in Allergen v. Sandoz that a claimed method for treating glaucoma (which differed from the three-times-a-day dosage regimens required of the individual components) was not inherently obvious, and thereby prevented a group of generic challengers from being able to market their own versions of Combigan^® before the expiration of the patent containing the claimed method.  However, Judge Dyk, dissenting-in-part, found no difference between the instant case and Federal Circuit precedent -- although the precedent relied upon was all directed to inherent anticipation.  Nevertheless, the majority and dissent agreed that the claims directed to the formulation itself were obvious in view of the prior art, and therefore reversed the lower court's finding of validity of all the claims.

This case involved Allergan's formulation for a combination eye-drop product marketed as Combigan^®, a product which combines a well-known alpha₂-agonist Alphagan^® (0.2% brimonidine) and a well-known beta-blocker Timoptic^® (0.5% timolol).  Allergan had found that by co-formulating these drugs, patient compliance increased because the drugs could now be administered at the same time, and because (unexpectedly) the number of daily administrations could be dropped from 3 to 2.  The inventors obtained four patents on this formulation and methods of its use, all stemming from an application filed on April 19, 2002, which Allergan listed in the Orange Book.  For the purposes of the appeal, the parties treated almost all of the asserted claims as one group, referring to claim 1 of U.S. Patent No. 7,323,463 ("the '463 patent") as the representative claim, which read:

1.  A composition comprising about 0.2% timolol by weight and about 0.5% brimonidine by weight as the sole active agents, in a single composition.

The only other asserted claim was claim 4 of U.S. Patent No. 7,030,149 ("the '149 patent"), which read:

4.  A method of reducing the number of daily topical ophthalmic doses of brimondine administered topically to an eye of a person in need thereof for the treatment of glaucoma or ocular hypertension from 3 to 2 times a day without loss of efficacy, wherein the concentration of brimonidine is 0.2% by weight, said method comprising administering said 0.2% brimonidine by weight and 0.5% timolol by weight in a single composition.

Sandoz Inc., Alcon Laboratories, Inc., Alcon Research Ltd., Alcon, Inc., and Falcon Pharmaceuticals, Ltd. (collectively, "Sandoz"), and the other defendants Apotex Inc. and Apotex Corp., and Watson Laboratories, Inc., each filed Abbreviated New Drug Applications with the FDA seeking to market generic versions of Combigan^®.  In turn, Allergan sued them under 35 U.S.C. § 271(e)(2)(A).  After a claim construction determination, the lower court granted summary judgment of non-infringement as to claims 1-3 of the '149 patent, and the parties stipulated to infringement of the remaining claims.  After a bench trial, the District Court found all of the claims nonobvious over the prior art.  The defendants appealed.

The Formulation Claims – Claim 1 of the '463 Patent as Representative

The lower court had rejected an invalidity allegation that Claim 1 of the '463 patent was obvious primarily in view of U.S. Patent No. 5,502,052 ("DeSantis").  This reference taught the use of a combination of alpha₂-agonists and beta-blockers for treating glaucoma, but did not teach that brimonidine could be one of those alpha₂-agonists.  Nevertheless, DeSantis incorporated by reference a publication by Timmermans, which disclosed brimonidine and its tartrate salt.  Also, even if not mentioned by name, the ranges of the components of claimed formulations fell within the ranges as taught by DeSantis -- 0.02 to 2.0% alpha₂-agonist and 0.01 to 3.0% beta-blocker.  Also in the art was a reference that taught the topical administration of 0.2% brimonidine with 0.5% timolol in combination, although spaced five minutes apart, and the fact that it was common to dose the serial application of these two drugs twice a day.  Moreover, there were only three known pharmaceutically acceptable alpha₂-agonists at the time for the treatment of glaucoma -- clonidine, apraclonidine, and brimonidine.  The Federal Circuit did not necessarily disagree with any of the factual findings of the lower court related to obviousness, but instead reversed because it believed that the facts instead supported a finding of obviousness.

Motivation to Combine

The lower court relied heavily on the fact that there would be no motivation to develop fixed combination products, even though such formulations might improve patient compliance, because the FDA does not consider patient compliance as a factor when approving new formulations.  The Federal Circuit noted that FDA approval might be a factor in an obviousness determination, for example when determining whether there was motivation to develop a drug or whether there was skepticism regarding efficacy.  However, it also noted that motivation to combine may be found in many different places, not just in the rationale used by the FDA as a basis for its approvals.  In view of the overwhelming amount of prior art related to the claimed formulation, the Federal Circuit thought there was sufficient support to find a motivation to combine, notwithstanding the FDA's approval process.  Somewhat lacking in the analysis, however, was how the FDA's position regarding patient compliance does factor into the obviousness determination.

Reasonable Expectation of Success

The lower court found that the unpredictability in the chemical arts weighed in favor of a finding of nonobviouness.  As a factor, the District Court considered Allergan's challenges formulating Combigan^®.  The Federal Circuit did not agree, because some degree of unpredictability is fine, provided there is a reasonable probability of success.  In this case, DeSanits provided that reasonable probability.  Moreover, Allergan's formulation difficulties stemmed from the fact that it was attempting to use a proprietary preservative.  There is no record of continued difficulties once its scientists switched to a commonly used preservative.  The fact that the claims were not drawn to the precise formulation Combigan^® was important, because there is no requirement that there be a reasonable expectation of success in formulating Combigan^®.

Teaching Away

The lower court had found factors that taught away from the claimed formulation, including the potential side effects, differing dosing regimens, and disparate half-lives of brimonidine and timolol.  However, as the Federal Circuit explained, the District Court did not consider the impact that these factors would have on the clear motivation to combine (probably because it did not find a motivation to combine).  Interestingly, the Federal Circuit pointed out that the lower court did not find that the prior art as a whole taught away from the claimed invention.  The Court, therefore, accepted the factual findings from below, but concluded that they did not render the invention nonobvious.

Secondary Factors

Finally, the Federal Circuit accepted all the lower court's factual findings with regard to secondary considerations of nonobviousness, but still found that they did not weigh heavily enough to overcome obviousness of the claims.  With regard to long-felt need, the District Court's findings were apparently entirely conclusory.  With regard to unexpected results, the lower court had found that the claimed formulations were able to overcome previous difficulties in treating patients with twice-per-day dosage regimens.  The Federal Circuit thought this was somewhat irrelevant.  The Court did agree that these results were unexpected.  However, while such results might be meaningful to method of treatment claims, they were not as relevant to the formulation claims.

The Method-of-Treatment Claim – Claim 4 of the '149 Patent

As shown above, the treatment claim has a couple of relevant limitations, including the above-referenced formulation of brimonidine and timolol, and the use of this formulation twice a day with the same efficacy as brimonidine administration three times a day.  The problem with administering brimonidine only twice a day was that efficacy would drop eight to nine hours after administration, in a phenomenon referred to as "afternoon trough."  The majority found that the defendants did not establish by clear and convincing evidence that the claimed method would have been obvious.  Importantly, the defendants apparently did not argue that the "efficacy limitation" is inherent to all fixed combination products containing brimonidine and timolol, or that a dose reduction would inherently flow from the obvious formulation included in the claims.  And, the defendants' citation to the success in using timolol with other non-alpha₂-agonist ophthalmic drugs with reduced doses was found to be irrelevant, because there was no reason why the use of these unrelated drugs would make the claimed method obvious.

Judge Dyk, in dissent, disagreed -- he would have also reversed the finding of nonobviousness of this claim.  He relied heavily on his belief that the method claim only contained one step -- applying a fixed combination of 0.2% brimonidine and 0.5% timolol twice a day.  It was not explained, however, why he considered two administrations to be a single step.  Nevertheless, Judge Dyk believed that the twice-a-day dosing of a formulation that was not in the prior art would have nonetheless been obvious to one skilled in the art, and that the alleged avoiding-"loss of efficacy" limitation was just the result of the claimed method.  As support for this proposition, Judge Dyk cited to three Federal Circuit cases:  Abbott Labs. v. Baxter Pharm. Prods., 471 F.3d 1363 (Fed. Cir. 2006); In re Cruciferous Sprout Litig., 301 F.3d 1343 (Fed. Cir. 2002), and Bristol-Myers Squibb Co. v. Ben Venue Labs., 246 F.3d 1368 (Fed. Cir. 2001).  However, each of these cases relates to inherent anticipation, not inherent obviousness.  It is not self-evident that the reasoning behind allowing the inherent result flowing from the use of a prior art composition or method to anticipate a claim would apply with equal force to a composition or method that was only obvious in view of the prior art.  In other words, citation of these cases, without more, is like comparing apples with oranges.

Moreover, Judge Dyk does not appear to consider the fact that there were two limitations that were not taught in the prior art -- the formulation and its method of use.  It should not be sufficient to conclude that, just because a formulation was obvious, any method of using it must also be.  Granted, this case would have been completely different if the claimed formulation was taught in the prior art, and the only potentially obvious limitation was its use twice a day.  In such a case, it is possible that its use might have been obvious, and the "efficacy" result that flowed from it could therefore have been inherent.  This is, perhaps, why the majority agreed in footnote 1 that "the inherency doctrine may apply to an otherwise obvious claim" in some situations.  Nevertheless, this was not the case and, without more, the majority's position was more grounded in the facts of the case, and in the Court's precedent.

Allergan, Inc. v. Sandoz Inc. (Fed. Cir. 2013)
Panel:  Circuit Judges Dyk, Prost, and O'Malley
Opinion for the court by Circuit Judge Prost; opinion concurring-in-part and dissenting-in-part by Circuit Judge Dyk

Biotech Venture Funding Down 33% in First Quarter

By Donald Zuhn --

Earlier this month, the National Venture Capital Association (NVCA), a trade association representing the U.S. venture capital industry, released the results of its MoneyTree Report on venture funding for the first quarter of 2013.  The report, which is prepared by NVCA and PriceWaterhouseCoopers LLP using data from Thomson Reuters, indicates that venture capitalists invested $5.9 billion in 863 deals in the first quarter, which constituted a 12% decrease in dollars and a 15% decrease in deals as compared with the fourth quarter of 2012, when $6.7 billion was invested in 1,013 deals (see chart below; data from MoneyTree Reports).

Investment in the life sciences sector (which combines the biotechnology and medical device industries) experienced an even bigger decline, with funding dropping by 28% and the number of deals decreasing by 23%.  Although the biotechnology industry ranked second in terms of dollars invested, with $875 million going into 96 deals, biotechnology funding dropped 33% in terms of dollars and 30% in terms of deals from the fourth quarter of 2012.  The software industry ranked first among all industries with $2.3 billion being invested in 329 deals in the first quarter, which marked the fourth straight quarter in which that industry topped $2 billion in funding.  Overall, eleven of the seventeen sectors tracked by the NVCA saw decreases in dollars invested in the first quarter.

NVCA head of research John Taylor indicated that the decreased investment in the first quarter was not unexpected.  He noted that "[t]he venture industry has been raising less capital than it has been investing now for several years," adding that "we are seeing less money going into traditionally capital-intensive sectors such as clean tech and life sciences, especially in first-time deals."  Tracy Lefteroff, the global managing partner of the venture capital practice at PricewaterhouseCoopers, noted that "[t]he bright spot in the first quarter was Software," pointing out that "[t]hese capital-efficient companies that have shorter time frames to a liquidity event -- whether that is M&A or IPO -- continue to be attractive to an ever-shrinking pool of VC funds."

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

• "Annual Venture Funding Drops for First Time in Three Years," February 4, 2013
• "Biotech Venture Funding Up 64% in Third Quarter," October 29, 2012
• "Venture Funding in Life Sciences Sector Drops 9% in Second Quarter," July 22, 2012
• "Biotech Venture Funding Drops 43% in First Quarter," May 3, 2012
• "Venture Funding Increased 22% in 2011," February 2, 2012
• "Life Sciences Venture Funding Drops in Third Quarter," October 27, 2011
• "Life Sciences Venture Funding up 37% in Second Quarter," August 1, 2011
• "VentureSource Reports 35% Increase in 1Q Venture Funding," April 26, 2011
• "NVCA Reports Modest Gains in First Quarter Venture Funding," April 19, 2011

• "NVCA Reports 31% Drop in Venture Funding for Third Quarter," October 17, 2010

• "NVCA Reports 34% Increase in Venture Funding for Second Quarter," July 22, 2010

• "NVCA Report Shows First Quarter Drop in Venture Funding," April 20, 2010

• "Biotech/Pharma Financing Improving, R&D Spending Up," August 31, 2009
• "NVCA Study Shows Increase in Third Quarter Venture Funding," October 23, 2009

• "First Quarter Venture Capital Funding at 12-Year Low," April 23, 2009

• "NVCA Study Shows Decline in 2008 Investment; BIO Study Predicts Biotech Rebound in 2009," February 16, 2009

Coelacanth Genome Sequence Determined

By Kevin E. Noonan --

The coelacanth, an aquatic animal described as a "living fossil" when discovered in 1938, was thought to have gone extinct during late Cretaceous period, ~70 million years ago.  Only about 300 specimens of the African coelacanth, Latimeria chalumnae, are known to exist and a second species, Latimeria menadoensis, was discovered in 1997.  These animals are morphologically primitive, resembling fossils dating ~300 million years ago, which has suggested that these are "slowly evolving" species (although this is more a descriptive than an informed characterization).  There have been sporadic reports of coelacanth gene sequencing over the past decade, but last week Nature published the first report on whole genome sequencing (Ameniya et al., "The African coelacanth genome provides insighted into tetrapod evolution," Nature 496: 311-16, April 18, 2013).

The article reports that the coelacanth genome comprises 2.68 gigabases, on 48 chromosomes, with 19,033 protein-coding genes comprising 21,817 transcripts, 2,894 "short" non-coding RNAs, and 1,214 "long" non-coding RNAs.  336 of protein-encoding genes were found to have undergone gene duplication.  The authors examined transcripts from 251 genes from coelacanth and compared these genes with Protopterus annectens (the African lungfish) expressed in brain, gonad, and kidney and with 15 terrestrial vertebrate lineages (dog, human, mouse, elephant, armadillo, Tammar wallaby, opossum, platypus, chicken, turkey, zebra finch, lizard, Western clawed frog, Chinese brown frog) and five modern fish species (tilapia, pufferfish, zebra fish, spotted catshark, little skate, and elephant shark).  The results of these analysis, comprising 100,583 concatenated amino acid positions, was consistent with the lungfish being the earliest relative of modern tetrapods (four-limbed animals), answering a previously unresolved uncertainty as to the role of the coelacanth in vertebrate evolution.

Turning to the question of the status of the coelacanth as a "living fossil," the authors confirmed earlier conclusions (based on Hox genes and protocadherins) that this species evolves slowly, the authors assessed the data from the 251 genes used in their phylogenetic analyses.  This was done as follows:

Pair-wise distances between taxa were calculated from the branch lengths of the tree using the two-cluster test proposed previously to test for equality of average substitution rates.  Then, for each of the following species and species clusters (coelacanth, lungfish, chicken and mammals), we ascertained their respective mean distance to an outgroup consisting of three cartilaginous fishes (elephant shark, little skate and spotted catshark).  Finally, we tested whether there was any significant difference in the distance to the outgroup of cartilaginous fish for every pair of species and species clusters, using a Z statistic.

The coelacanth genes showed 0.89 substitutions per site, compared with 1.05 substitutions/site in the lungfish, 1.09 substitutions/site in chicken, and 1.21 substitutions/site in mammals.

The authors also ascertained the "abundance" of transposable elements in the coelacanth genome, because these elements are believed to provide "templates for exaptation," i.e., to facilitate formation of novel protein exons and regulatory elements, as well as providing targets for genomic rearrangement.  Transposable element content was "high" (~25%, which the authors consider an underestimate) and also showed a "wide variety of transposable-element superfamilies," with 14 such families being "currently active."  The authors acknowledge that these results "contrast[] with the slow protein evolution observed."

"[E]xtensive conservation of synteny" was observed in a comparison of chromosomal breakpoints in coelacanth and tetrapod genomes, and "indicate that large-scale rearrangements have occurred at a generally low rate in the coelacanth lineage."  Interchromosomal rearrangements indicated that "karyotypic evolution in the coelacanth lineage has occurred at a relatively slow rate, similar to that of non-mammalian tetrapods" (31 in coelacanth, 20 in salamander and 21 in Xenopus species).  Comparison of the two coelacanth species, L. chalumnae (Africa) and L. menadoensis (Indonesia), showed divergence rates similar to those found between humans and chimpanzees, and the authors estimated that these species diverged "slightly more than" 6-8 million years ago, based on the slower substitution rates found in coelacanth species.

The authors then looked at estimates of how vertebrates adapted to the terrestrial environment.  They identified 50 genes found in coelacanth but not terrestrial tetrapods, presumably because these genes were not needed when the animal left water for land.  These genes included "components of fibroblast growth factor (FGF) signalling, TGF-β and bone morphogenic protein (BMP) signalling, and WNT signalling pathways, as well as many transcription factor genes," and specifically that 4 genes (And1, And2, Fgf24 and Asip2) not present in tetrapod genomes were indeed present in the coelacanth genome.  These genes also included 13 genes involved in fin development, 8 genes in otolith and ear development, 7 genes for kidney development, 13 genes for eye development, and 23 genes for brain development.  In contrast, there were only slight differences in homeobox genes.  There were also changes in gene regulation, wherein 6% of "conserved non-coding elements (CNEs)" ("promoters, enhancers, repressors and insulators") had originated after divergence of the coelacanth from the ancestral lineage.  Further analysis showed that tetrapod-specific CNEs were most closely (genetically) linked to genes involved in smell perception (consistent with the recognized expansion of olfactory receptor genes in the evolution of tetrapods from teleost fishes) and "morphogenesis (radial pattern formation, hind limb morphogenesis, kidney morphogenesis) and cell differentiation (endothelial cell fate commitment, epithelial cell fate commitment)" and immunoglobulin VDJ recombination.

A particular set of genes compared in the study are genes for digits, "[a] major innovation in tetrapod evolution," and specifically Hox genes for regulating limb development in ray-finned fish, coelacanths and tetrapods (mouse).  Three of the six "cis-regulatory elements" showed sequence conservation limited to tetrapods, with one element being shared by tetrapods and coelacanth but not the ray-finned fish; this latter element could function in transgenic mouse assays to "drive reporter gene expression in a limb-specific pattern."  Another particular set of genes compared between tetrapod and coelacanth lineages were genes for the urea cycle, because "[e]xcretion of nitrogen is a major physiological challenge for terrestrial vertebrates."  Urea cycle genes involved in producing urea for nitrogenous waste disposal (such as carbamoyl phosphate synthase I) showed strong evidence of selection whereas genes (such as mitochondrial arginase) involved in arginine metabolism but not excretion did not show such selection.  The authors conclude that this is evidence of adaptive evolution in the transition from water to land.  Hox gene studies also indicated changes from the coelacanth and tetrapod lineages implicated in placental and other reproductive structures not found in animals living in an aquatic environment.  Finally, the coelacanth genome lacks genes for immunoglobuins of the M class but did possess two IgW genes previously found only in lungfish and certain cartilaginous fish.

In addition to establishing that lungfish not the coelacanth was the common ancestor to all terrestrial vertebrate, the authors also established that the coelacanth also showed a slow rate of evolutionary change, which they speculate might be due to "a static habitat and lack of predation" and promising that "[f]urther study of these changes between tetrapods and the coelacanth may provide important insights into how a complex organism like a vertebrate can markedly change its way of life."

The authors were affiliated with the following institutions:  The Broad Institute at MIT; Benaroya Research Institute and University of Washington;  University of Konstanz, Germany; Universite de Montreal; University of Oregon; Institute of Molecular and Cell Biology, Singapore; Universidade Federal do Para, Brazil; Harvard University; University of Utah; Ecole Normale Superieure de Lyon; University of Kentucky; Rhodes University, South Africa; Wellcome Trust Sanger Institute; University of Trieste; University of Liege; Victoria University, Australia; University of Tuscia; University of Hamburg; Polytechnic University of Marche, Italy; University of South Florida; University of Western Cape, South Africa; Woods Hole Oceanographic Institution; Oxford University; Universitat Leipzig; Keio University, Japan; The Graduate University for Advanced Studies, Japan; European Molecular Biology Laboratory; University of Wuerzburg, Germany; University of Illinois at Chicago; National Institute of Genetics, Japan; and Uppsala University.

Image of Latimeria chalumnae (above) by Alberto Fernandez Fernandez, from the Wikipedia Commons under the Creative Commons Attribution 3.0 Unported license.

Court Report

By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases.

Mayo Foundation for Medical Education and Research v. ARUP Laboratories, Inc.
0:13-cv-00933; filed April 22, 2013 in the District Court of Minnesota

Infringement of U.S. Patent Nos. 7,700,365 ("Vitamin D Deficiencies," issued April 20, 2010), 7,901,944 (same title, issued March 8, 2011), and 8,349,613 ("Mass Spectroscopy Techniques for Detecting Vitamin D Compounds in a Sample," issued January 8, 2013) based on ARUP's diagnostic testing referred to as "25-Hydroxyvitamin D2 and D3 by Tandem Mass Spectrometry."  View the complaint here.

Bioniche Life Sciences, Inc. v. Rea
1:13-cv-00491; filed April 22, 2013 in the Eastern District of Virginia

Review and correction of the patent term adjustment calculation made by the U.S. Patent and Trademark Office for U.S. Patent No. 8,293,745 ("Use of Imatinib to Treat Liver Disorders and Viral Infections," issued October 23, 2012).  View the complaint here.

Precision Biosciences Inc. et al. v. Lonza Group Ltd. et al.
1:13-cv-00708; filed April 19, 2013 in the District Court of Delaware

• Plaintiffs:  Precision Biosciences Inc.; Duke University
• Defendants:  Lonza Group Ltd.; Lonza Sales Ltd.; Lonza Biologics plc; Lonza Inc.; Lonza Walkersville Inc.; Lonza Biologics Inc.

Infringement of U.S. Patent No. 8,377,674 ("Method for Producing Genetically-Modified Cells with Rationally-Designed Meganucleases with Altered Sequence Specificity," issued February 19, 2013) based on Lonza's manufacture, use, and sale of certain products, including the GS Xceed^TM Gene Expression System and CHOK1SV GS knock-out host cell.  View the complaint here.

Pfizer Inc. et al. v. Inventia Healthcare Private Ltd.
1:13-cv-02986; filed April 19, 2013 in the Northern District of Illinois

• Plaintiffs:  Pfizer Inc.; Pharmacia & Upjohn Co. LLC; Pfizer Health AB
• Defendant:  Inventia Healthcare Private Ltd.

Infringement of U.S. Patent Nos. 6,630,162 ("Pharmaceutical Formulation and Its Use," issued October 7, 2003) and 6,770,295 ("Therapeutic Formulation for Administering Tolterodine with Controlled Release," issued August 3, 2004) following a Paragraph IV certification as part of Inventia's filing of an ANDA to manufacture a generic version of Pfizer's Detrol LA® (extended release tolterodine tartrate, used to treat overactive bladder).  View the complaint here.

Helsinn Healthcare SA et al. v. Aurobindo Pharma Ltd. et al.
1:13-cv-00688; filed April 16, 2013 in the District Court of Delaware

• Plaintiffs:  Helsinn Healthcare SA; Roche Palo Alto LLC
• Defendants:  Aurobindo Pharma Ltd.; Aurobindo Pharma USA Inc.

Infringement of U.S. Patent Nos. 7,947,724 ("Liquid Pharmaceutical Formulations of Palonosetron," issued May 24, 2011), 7,947,725 (same title, issued May 24, 2011), and 7,960,424 (same title, issued June 14, 2011) following a Paragraph IV certification as part of Aurobindo's filing of an ANDA to manufacture a generic version of Helsinn's Aloxi® (palonosetron hydrochloride intravenous solution, used to prevent chemotherapy induced nausea and vomiting).  View the complaint here.

Conference & CLE Calendar

April 30, 2013 - CincyBIO (CincyIP) - Cincinnati, OH

May 7-8, 2013 - Paragraph IV Disputes (American Conference Institute) - New York, NY

May 13-14, 2013 - Generics and Patent Strategies (SMi) - London, UK

May 14, 2013 - Forum on Pharma & Biotech Collaborations (C5 (UK)) - Frankfurt, Germany

May 14-16, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - Chicago, IL

May 15-16, 2013 - Forum on Freedom to Operate (C5 (UK)) - Frankfurt, Germany

May 21-23, 2013 - Pharma Legal Affairs (IBC Life Sciences) - Shanghai, China

May 27, 2013 - A Harmonized Patent World -- Are We Getting There? (Intellectual Property Owners Association) - Brussels, Belgium

May 29, 2013 - AIA and Patent Due Diligence Understanding the AIA Impact and Best Practices for the Due Diligence Process (Strafford) - 1:00 - 2:30 pm (ET)

June 5-7, 2013 - Advanced Forum on Biosimilars (American Conference Institute) - New York, NY

June 12-14, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - New York, NY

June 25-26, 2013 - Maximising Pharma Patents (C5 (UK)) - London, England

July 10-12, 2013 - Fundamentals of Patent Prosecution 2013: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) - San Francisco, CA

***Patent Docs is a media partner of this conference or CLE