By Donald Zuhn --
On Friday, in Duramed Pharmaceuticals, Inc. v. Watson Laboratories, Inc., the Federal Circuit reversed a decision by the District Court for the District of Nevada on summary judgment that the asserted claims of U.S. Patent No. 7,320,969 were nonobvious, determining that the District Court erred in its obviousness analysis. The Federal Circuit also affirmed the District Court's exclusion of expert testimony on prior use, finding that Watson failed to demonstrate that the lower court abused its discretion in excluding the testimony.
Plaintiff-Appellee Duramed Pharmaceuticals owns the '969 patent, which is directed to an extended-cycle combined oral contraceptive ("COC") regimen that Duramed markets as Seasonique®. In contrast with a traditional 28-day COC, in which estrogen/progestin pills are taken for 21 days and then hormone-free pills are taken for 7 days, under Duramed's extended-cycle COC, estrogen/progestin pills (30 μg ethinyl estradiol and 150 μg of levonorgestrel) are taken for 84 days and then low-dose estrogen (10 μg ethinyl estradiol) are taken for 7 days. The extended-cycle regimen serves to increase the menstrual cycle's natural length, and the low-dose estrogen helps to postpone estrogen-withdrawal symptoms that may be experienced during the hormone-free period of traditional COC regimens.
Seeking approval to market a generic version of Seasonique®, Defendant-Appellant Watson Laboratories filed an Abbreviated New Drug Application (ANDA) with the FDA. In response to Watson's ANDA filing, Duramed brought suit against Watson for infringement of claims 1-9, 15, and 17-19 of the '969 patent. Watson stipulated to infringement but challenged the validity of the asserted claims, asserting that they were obvious in view of several references, including three articles (one by Kovacs and two by Sulak) and U.S. Patent No. 6,027,749. The Kovacs article describes an extended-cycle COC regimen in which pills containing 30 μg ethinyl estradiol and 150 μg levonorgestrel are taken for 84 days and then hormone-free pills are taken for 7 days, the '749 patent describes COC regimens in which pills containing 15-20 μg ethinyl estradiol and 50-125 μg levonorgestrel are taken for up to 77 days and then pills containing 10-15 μg ethinyl estradiol are taken for 7 days in order to reduce the incidence of premenstrual headaches, and the Sulak articles describe the use of low-dose estrogen during the hormone-free period as a way to alleviate headaches resulting from estrogen withdrawal. Watson also introduced testimony from an expert who opined that one of skill in the art would have been motivated to combine the above references to arrive at the extended-cycle COC of the '969 patent, and further testified that he had personally prescribed the extended-cycle COC regimen of the '969 patent prior to the patent's priority date. The District Court granted Duramed's motion for summary judgment of nonobviousness and its motion to exclude the expert's testimony regarding prior use for lack of corroboration.
On appeal, Watson argued that it had raised genuine issues of material fact regarding whether it would have been obvious to combine the Kovacs COC regimen with low-dose estrogen administration during the traditional hormone-free period to treat estrogen-withdrawal headaches in light of the Sulak articles and the '749 patent. Watson contended that the District Court, by granting summary judgment of nonobviousness, erred by focusing on individual references instead of considering the teaching of the prior art as a whole, improperly required clear and convincing evidence of invalidity on summary judgment, ignored all but three prior art references as cumulative, erroneously required that the prior art teach a virtual guarantee of success, and failed to make a finding of the level of skill in the art. In reversing the District Court's grant of summary judgment, the Federal Circuit agreed with Watson that the lower court had erred in assessing the content and scope of the prior art, appeared to have applied an incorrect evidentiary standard on summary judgment, and failed to make any finding on the level of skill in the art.
With respect to the District Court's assessment of the content and scope of the prior art, the Federal Circuit first addressed the lower court's findings with respect to the Sulak references, stating:
Regarding Sulak, the court rejected all consideration of the articles' teaching of the use of unopposed estrogen because that use was mentioned only as a "theoretical," rather than a tested solution to estrogen-withdrawal headaches. A reference, however, is prior art for all that it discloses, and there is no requirement that a teaching in the prior art be scientifically tested, or even guarantee success, before providing a reason to combine. Rather, it is sufficient that one of ordinary skill in the art would perceive from the prior art a reasonable likelihood of success.
(citations omitted). As for the '749 patent, the panel noted that:
The district court . . . found that the '749 patent discloses a variety of COC regimens and thus concluded that the patent "does not teach any one specific combination that would establish consistent knowledge in the community." However, the question is not whether there existed a consistent COC regimen in the art, but rather whether one of ordinary skill in the art would have been motivated to combine the Kovacs regimen with 7 days of low-dose, unopposed estrogen with the reasonable expectation that the addition of low-dose estrogen would successfully reduce the incidence of estrogen-withdrawal headaches during the hormone-free period.
(citation omitted). The Federal Circuit concluded that:
Based on its errors in assessing the content of these prior art references, the district court improperly analyzed and rejected the teaching of each in isolation, concluding that each alone failed to establish by clear and convincing evidence a motivation to combine. . . . Accordingly, the district court failed to properly consider the collective teaching of the prior art in light of the common sense and creativity of the person of ordinary skill in the art.
The Federal Circuit also noted that the District Court appeared to have applied an incorrect evidentiary standard on summary judgment, placing the burden of proof on Watson, the nonmoving party, to show clear and convincing evidence of invalidity. The panel explained that because Duramed had moved for summary judgment of nonobviousness, "the burden rested with Duramed to show that Watson had failed to come forth with clear and convincing evidence of an essential element of its prima facie case of obviousness."
With respect to findings regarding the level of skill in the art, the Federal Circuit first noted that "[w]hen a finding of the level of skill affects the court's ultimate conclusion under § 103, the failure to make such a finding constitutes reversible error." In this case, the panel determined that "the district court appears to have simply rejected all of Watson's expert's testimony by finding that [the expert] was not a person of ordinary skill, but extraordinary skill," which the Court found "was error."
While noting that "in reviewing the record de novo on summary judgment and crediting Duramed's lower level of skill in the art, the district court on remand may well conclude that the claimed extended-cycle COC regimen would have been obvious as a matter of law," the Federal Circuit stated that:
[O]n the record before us, there appear to be no genuine issues of material fact that, based on the teaching of Kovacs, the '749 patent, and the Sulak articles, one of ordinary skill would have been motivated to combine the Kovacs regimen and 7 days of 10 μg unopposed ethinyl estradiol with a reasonable expectation that the combination would reduce the incidence of headaches associated with that regimen.
However, because Duramed did not have an opportunity to challenge Watson's prima facie case of obviousness or introduce any secondary considerations of nonobviousness, the Federal Circuit remanded the case to the District Court.
Duramed Pharmaceuticals, Inc. v. Watson Laboratories, Inc. (Fed. Cir. 2011)
Nonprecedential disposition
Panel: Circuit Judges Lourie, Linn, and Dyk
Opinion by Circuit Judge Lourie
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