Intendis GmbH v. Glenmark Pharmaceuticals Inc., USA (Fed. Cir. 2016)

By Kevin E. Noonan --

The Federal Circuit and the Supreme Court spent an inordinate amount of time wrestling with each of their conceptions of the scope and application of the doctrine of equivalents a dozen years ago, coming to an accommodation in the last of the Federal Circuit's decisions in Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., Ltd. (Fed. Cir. 2007).  In Intendis GmbH v. Glenmark Pharmaceuticals Inc., USA the Federal Circuit demonstrated the resulting equipoise in affirming a district court's determination that the doctrine applied to an accused infringing generic formulation.

The case involved ANDA litigation between the parties over Orange Book Listed U.S. Patent No. 6,534,070 directed to Finacea® Gel, a topical medication for various skin disorders.  This product is a formulation comprising 15% by weight azelaic acid and excipients including triglycerides and lecithin provided as a hydrogel.  Claim 1 of the '070 patent at issue in this litigation reads as follows:

1.  A composition that comprises:
    (i) azelaic acid as a therapeutically active ingredient in a concentration of 5 to 20% by weight,
    (iii) at least one triacylglyceride in a concentration of 0.5 to 5% by weight,
    (iv) propylene glycol, and
    (v) at least one polysorbate, in an aqueous phase that further comprises water and salts, and the composition further comprises
    (ii) at least one polyacrylic acid, and (vi) lecithin,
    wherein the composition is in the form of a hydrogel. (emphases in opinion).

The accused infringing article that was the subject of Glenmark's ANDA was a 15% azelaic acid formulation where the ANDA formulation substituted isopropyl myristate for the combination of lecithin and triglyceride, which substitution Glenmark contended was non-infringing.  The District Court found the claims not invalid for obviousness and infringed under the doctrine of equivalents (DOE).  The District Court used the "function-way-result" test to find DOE infringement, and rejected Glenmark's arguments that 1) if infringing the claims would encompass the prior art, and 2) that DOE infringement was marred by prosecution history estoppel.  The District Court also rejected Glenmark's validity challenge for obviousness, based on failure to show motivation to combine the asserted prior art references and failure to show a reasonable expectation of success.  In addition, the District Court found that the objective indicia, including unexpected results and commercial success, "weighed in favor of non-obviousness."

The Federal Circuit affirmed, in an opinion by Judge Moore joined by Chief Judge Prost and Judge Taranto.  With regard to DOE infringement, the panel applied the "clear error" standard appropriate for questions of fact in a bench trial, citing Allergan, Inc. v. Sandoz Inc., 796 F.3d 1293, 1311 (Fed. Cir. 2015).  Although there was no objection by either party to the District Court using the function-way-result test for determining whether there was infringement under the doctrine of equivalents, Glenmark contended that the District Court erred in its application of the "function" prong (and the opinion expressly points out that the question of the substantiality vel non of the differences in chemical structure between isopropyl myristate, triglycerides, and lecithin was not before it).  The District Court found that isopropyl myristate in Glenmark's formulation had the same function as the combination of lecithin and triglyceride in the claimed formulation, i.e., to enhance azelaic acid's penetration into the skin, based on expert testimony and statements in Glenmark's ANDA itself.  For the "way" prong, the District Court found that Glenmark's isopropyl myristate component worked in substantially the same way as the patent combination of lecithin and triglyceride, "by disrupting the lipids in the skin's outermost layer, known as the stratum corneum."  Finally, the District Court found that use of isopropyl myristate in Glenmark's formulation produced substantially the same result as the combination of lecithin and triglyceride in the claimed formulation, so that "a therapeutically effective azelaic acid composition [] is able to penetrate the skin in order to deliver the active ingredient."

Glenmark's argument against these factual conclusions was that the District Court erred in finding that the combination of lecithin and triglyceride acted as skin penetration enhancers.  In support of this argument Glenmark asserted that the '070 patent itself was silent on this question (which was "fatal to Intendis' infringement case") as well as evidence from Finacea's NDA (which characterized lecithin as an emulsifier and triglyceride as an emollient) and the absence of any scientific literature support for skin penetration-enhancing properties of these compounds or their combination.

The Federal Circuit rejected this argument, stating that its cases did not require a patentee to establish the mechanism through which a claimed invention operated, in favor of recourse to how the ordinarily skilled artisan would understand the specification and claims.  Instead of being confined to the intrinsic record, according to the opinion, "[t]he relevant inquiry is what the claim element's function in the claimed composition is to one of skill in the art, and a fact finder may rely on extrinsic evidence in making this factual determination," citing Zenith Labs., Inc. v. Bristol-Myers Squibb Co., 19 F.3d 1418, 1425 (Fed. Cir. 1994).  In addition, the panel said that it was "fatal to Glenmark's argument" that its own ANDA contained statements "repeatedly referring to the claimed excipients (triglyceride and lecithin) as penetration enhancers."  (And somewhat amusingly, the opinion cited "seemingly extemporaneous arguments" during oral argument in the case where counsel asserted that any such statements in Glenmark's FDA filings were "a 'guess' and 'wrong.'")

Turning to the question of whether the District Court's interpretation of the claims and the equivalence of isopropyl myristate with lecithin and triglyceride would "encompass the prior art," the opinion cites DePuy Spine, Inc. v. Medtronic Sofamor Danek, Inc., 567 F.3d 1314, 1322 (Fed. Cir. 2009), and Ultra-Tex Surfaces, Inc. v. Hill Bros. Chem. Co., 204 F.3d 1360, 1364 (Fed. Cir. 2000), that making this determination requires a two-prong analysis.  First, the court should craft a "hypothetical" claim that literally ensnares the accused infringing article.  Second, the court should determine whether that hypothetical claim is patentable over the prior art or record; note that the patentee bears burden of establishing patentability of this hypothetical claim.  In performing the hypothetical claim analysis, the District Court included isopropyl myristate as an alternative expressly recited in the claim; unfortunately for Glenmark, the art it asserted disclosed dimethyl sulfoxide as a penetration enhancer and not isopropyl myristate, lecithin, or triglyceride.

On appeal Glenmark argued that the District Court erred by crafting a hypothetical claim that was narrower than the actual claims at issue, and that the Court should have created a hypothetical claim that recited any penetration enhancer (which would have ensnared the art disclosing DMSO).  The Federal Circuit rejected this criticism, stating that "[t]he district court's infringement finding was that the excipient in Glenmark's product (isopropyl myristate) was equivalent to the claimed excipients (lecithin and triglycerides); it was not a finding that any penetration enhancer would be equivalent to the claimed excipients," citing Graver Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 609 (1950).  Because Glenmark challenged the District Court's choice of hypothetical claim and not its conclusion that the claims would be patentable, the Federal Circuit found no reversible error in the lower court's factual findings.

The panel also rejected Glenmark's third argument on appeal, that prosecution history estoppel barred application of the doctrine of equivalents to these claims.  The basis for Glenmark's argument was that, during prosecution, the examiner objected to language in two dependent claims because this language could be interpreted to result in formulations having no lecithin (concentrations of "up to 1%" and "up to 3%" could include 0%, i.e., none).  Applicants argued that this interpretation was inconsistent with dependency on claim 1, which affirmatively recited that the formulation contained lecithin (albeit without specifying a particular amount).  In addition, however, these dependent claims were amended to recited concentrations of "from more than 0 to 1%" or "from more than 0 to 3%" to overcome the examiner's rejections and Glenmark argued that prosecution history estoppel should therefore apply to claim 1.  The District Court rejected Glenmark's argument that these amendments amounted to disclaimer and the Federal Circuit (reviewing this determination de novo) agreed, stating that it could find "no clear and unmistakable surrender of subject matter" as required, inter alia, by Deering Precision Instruments, LLC v. Vector Distrib. Sys., Inc., 347 F.3d 1314, 1326 (Fed. Cir. 2003).  And because the amendments did not narrow the scope of the dependent claims, the panel agreed that these were "clarifying" amendments that did not raise prosecution history estoppel against asserted claim 1.

Finally, the opinion also rejected Glenmark's argument that claim 1 of the '070 patent was obvious.  The asserted prior art ("previously-marketed Skinoren® cream" combined with references disclosing formulations comprising the claimed excipients and art disclosing azelaic acid formulations) did not render the claimed compositions obvious due to "certain undesirable qualities" of the prior art Skinoren® cream that would have led the skilled artisan to develop a "different dosage form given the market forces and deficiencies of the prior art formulation."  Although the District Court acknowledged that this art would have motivated the skilled worker to pursue hydrogel formulations like the claimed invention, the Court did not find any motivation to use the claimed lecithin and triglyceride excipients.  And the District Court also found that even if the art could be viewed a providing the required degree of motivation to combine the art to arrive at the invention claimed in the '070 patent there was insufficient likelihood of success to support an obviousness determination.  The Federal Circuit disagreed with Glenmark's challenges to the District Court's determinations (reciting and dismissing them cursorily) and upheld the District Court's conclusion that the claims were not obvious.

Intendis GmbH v. Glenmark Pharmaceuticals Inc., USA (Fed. Cir. 2016)
Panel: Chief Judge Prost and Circuit Judges Moore and Taranto
Opinion by Circuit Judge Moore

Comments

[EG]

Hey Kevin,

I must say that treating a monoester (isopropyl myristate) as being a DOE equivalent of the combination a triglyceride and lecithin (a mixture of diglycerides linked to choline esters of phosphoric acid) is a pretty strange application of DOE. Admittedly, the Federal Circuit panel noted that: "To be clear, we are not presented the issue of the substantiality of the differences between the chemical structures of isopropyl myristate,triglyceride, and lecithin." But such chemical "differences" should impact the application of DOE. (Note that SCOTUS in Graver Tank also committed the faux pas of treating magnesium as being equivalent to manganese.) Also, as the accused infringer correctly pointed out, the functional benefit alleged for the combination of triglyceride and lecithin (as "penetration enhancers") is nowhere to be found in the patent. Also admittedly, the accused infringer was caught by their own statements to the FDA that isopropyl myristate was equivalent to the combination of triglyceride and lecithin as a "penetration enhancer." Even so, I find the application of DOE in this case very strange, including whether it complies with the "all elements rule" that still must be satisfied for DOE.

[IPSAN]

Hi Kavin,

Both Federal Circuit and District Court's determinations are being same in this case of DOE..

It's a strange example of DOE.

But one thing we can note from here there is no stringent rule in law.. It May vary Case by Case.

[Kevin E. Noonan]

Dear EG: That’s the beauty of DOE, and has been since Graver Tank. Structural similarity isn’t a limitation – the point is whether the equivalent has the same function as the recited limitation. The fact that one chemical in the accused infringing article can perform the role of two in the patented invention doesn't preclude DOE infringement. However, the outcome perhaps would have been different if the argument was insubstantial differences rather than function-way-result, and this difference may suggest the type of inconsistency that raised issues about the scope of the rule that was the basis for the tussle between the Federal Circuit and Supreme Court a decade ago.

Thanks for the comment.

[skeptical]

Dr. Noonan,

Your comment of "That’s the beauty of DOE, and has been since Graver Tank. Structural similarity isn’t a limitation" is dead on - and I would only wish that so many people who think that equivalence in the patent sense carries with it some sort of "physical"-the-same-as requirement would stop, think, and recognize that such a "same-as" requirement just is not there.

For any field of art.

Once that is understood, then the meaning of "wares" becomes self-evident and the field of computer arts fundamental understanding that softWARE is equivalent to hardWARE (and equivalent to firmWARE) would be the proper starting point for software claim discussions.

Alas, those who should know better have an ulterior motive and a philosophy driving how they want to discuss that particular art field, and the basic understanding that you explicate with reference to Graver Tank will not be recognized, let alone admitted and integrated into any conversation on the merits.

[Derek]

To follow up on the first comment, and your detailed accounting of the court opinion, I am a little shocked at the selection of the infringing material for the hypothetical claim. I could not find any case law supporting such a selection. Obviously, the hypothetical claim has to literally cover the alleged equivalent, but are you aware of any decision allowing a free selection of the contents of the hypothetical claim based upon extrinsic evidence? I have not seen the briefs, but Sue Robinson's opinion (Dist. Del.) seems to indicate this. The choice of hypothetical claim scope appears to be a distortion of ensnarement to be a flexible, ad hoc, post filing determination based upon extrinsic evidence rather than any characterizations in the specification of the patent allegedly infringed under the DoE. The admitted prior art is responsible for the "careful and limited language of the claim" (see 117 F. Supp. 3d 549, 578), not any particular worthiness of the patent in question, and this patent has been awarded a bizarrely well-tailored hypothetical claim, apparently without intrinsic support. This decision seems to put no burden on the draftsman to give a hint of what might be equivalent.

[Derek]

as a caveat to my statement above:

US 6,534,070 Bl (col. 4, ll. 3-11) states that "[l]ecithins are obtained by extraction from biological material. A lecithin fraction from soybeans (the most common raw material) thus comprises, e.g., palmitic acid, stearic acid, palmitoleic acid, oleic acid, linoleic acid and linolenic acid. Normally, the saturated fatty acid with the primary hydroxy group of the glycerine and the unsaturated fatty acid with the secondary hydroxy group of the glycerine are
esterified."

While this does not describe mystiric acid (C13), palmitic is C15, stearic is C18, oleic is C18 (9Z unsat'd), linoleic is C18 (9Z, 12Z unsat'd), linolenic is C18 (9Z, 12Z, 15Z or 6Z unsat'd). Palmitic and oleic acid seem to be actually present in lecithin (https://en.wikipedia.org/wiki/Lecithin). However, there does not appear to have been a triol of any sort in the allegedly equivalent composition.