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Fed. Cir. Denies Rehearing in Drug Obviousness Case, With Dissents

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By Mark Wilson, Esq. on October 23, 2014 5:50 PM

Patents are supposed to be issued for new and novel things, not things that anybody could have come up with. A patent can be invalidated for "obviousness" if the thing that is to be patented is based on prior art and that thing would have been obvious to a person of ordinary skill in that field.

In the field of pharmaceuticals, a drug can be considered obvious if it's the made by adding something to an extant chemical -- something that anyone could have done and the result of which anyone would have expected. But what about after it's patented? That doesn't work, affirmed the Federal Circuit, in a divided opinion over a rehearing en banc in Bristol-Myers Squibb v. Teva Pharmaceuticals.

A Brief History

Let's go back to June 12, when a three-judge panel of the Federal Circuit ruled on this case. Bristol Myers-Squibb (BMS) patented a compound called entecavir, which it marketed as a treatment for hepatitis B called Baraclude. Teva wanted to make a generic version of entecavir, but BMS sued for infringement; Teva claimed BMS' original patent was invalid for obviousness because it was little more than a small alteration to an already well-known chemical called 2'-CDG. The Federal Circuit agreed.

Concurrence

The panel opinion from June centered on "later-discovered unexpected results." BMS said that later testing, showing that 2'-CDG was toxic, meant no scientist would have used it as a base for entecavir. The panel said that didn't matter: Even if 2'-CDG was later found to be toxic, at the time entecavir was created, its toxicity was unknown (though it was suspected, but no one knew how toxic it was).

The denial of rehearing en banc was two paragraphs, but Judge Kathleen O'Malley concurred to point out that, contrary to several pharmaceutical companies' fears, the panel didn't "forge new ground or set down immutable principles." Namely, O'Malley said that, contrary to the companies' claims, the court didn't wholly foreclose the use of later unexpected results. The panel's June decision did permit later results to inform what people knew at the time, but the panel merely didn't find the evidence persuasive.

2 Dissents

Three judges dissented from the denial of rehearing, led by Judge Pauline Newman. They would have granted the rehearing because the panel opinion introduced uncertainty about whether subsequent unpredictable results can be used to show that a patent wasn't obvious.

Another set of three judges, led by Judge Richard Taranto, clarified that they would have allowed the rehearing. Though the panel opinion claimed not to disturb settled law on subsequent unexpected results, the panel's refusal to credit the subsequent toxicity findings amounted to a de facto change in the law. Notably, 2'-CDG's toxicity hadn't yet been tested in mammals, meaning it's not clear that a reasonable scientist would have thought to use it as a lead compound at all.

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