BIOTECH BUZZ

February 2015 (Calendar)

Chair’s Notes – Suzannah K. Sundby

Buzz Editor – Suzannah K. Sundby Microsite Master – John Marquardt USPTO Relations – Joseph Mallon and Suzannah K. Sundby

● The next USPTO Biotech/Chemical/Pharmaceutical Partnership Meeting be April 7, 2015. This BCP Meeting will be held jointly at the Alexandria Campus and the Denver Satellite Office and speakers will be at both locations… more ● The Patent Relations with the USPTO Committee is seeking input on the Federal Register Notice on Enhancing Patent Quality. Please review the Notice here and send your comments to Esther Kepplinger and Ken Nigon by clicking here.

Vice Chair – Debora Plehn-Dujowich

Services Leader’s Notes – Carla Mouta Biotech Patent Education – Betsy Haanes and Ryan B. Chirnomas

● The Biotech Patent Education subcommittee is planning a series of articles which analyze the pros and cons of various terms and phrases used in patent specifications and claims, e.g., “and/or”, “preferably”, and “which” versus “that”, etc. If you would like to assist, please contact Ryan by clicking here.

Webinars – Carla Mouta ● Part I of a two-part webinar on the USPTO Interim Guidance on patent eligible subject matter under 101 was held on February 12, 2015. There were about 240 registered attendees and a total of about 500 listeners from around the world. If you missed it, read the summary... more ● Part II of a two-part webinar which focuses on inventions involving natural products and natural phenomenon will be held on February 19, 2015. Register for this webinar here.

Issues Leader’s Notes – Vicki Norton … more Biosimilars – Lynn Tyler and Kristin Connarn

● Noel Courage - Reports on the latest European guidance on biosimilars, this time addressing clinical and non-clinical issues… more ● An FDA Advisory Committee will discuss biologics license application (BLA) 125544 for CT-P13, a proposed biosimilar to Janssen Biotech Inc.'s REMICADE (infliximab), submitted by Celltrion, Inc. For more information, click here.

Industrial Biotech – Judy Roesler and Gerald Swiss ● Judy Roesler - Reports on the impact of the Supreme Court’s ruling in Teva v Sandoz on the petition for writ of certiorari in in Butamax Advanced Biofuels LLC v. Gevo Inc… more

PTAB Actions – Herbert Hart and Malaika Tyson ● Robert F. Kappers and Malaika Tyson - Report on PTAB’s two recent decisions denying institution of inter partes review. In Merial Ltd. V. Virbac, and in Par Pharmaceuticals, Inc. v. Jazz Pharmaceuticals, Inc… more

Community Leader’s Notes – Ling Zhong Biotech Agents – Angie Sebor

● Angie Sebor – The USPTO is seeking input on privileged communications between foreign patent practitioners and non-attorney agents and their clients. Written comments to the Federal Register Notice are due February 25, 2015. The USPTO is holding a roundtable on February 18, 2015… more

Corporate – James J. Kelley and Angie Sebor ● We have an exciting Spring CLE session planned with the Corporate Committee. If you are not an in-house attorney and can’t attend the Corporate Committee Breakfast, this is the next best thing. Plan on joining us in our imaginary world where Soteria Biosciences and its IP counsel contemplate intellectual property law issues that are critical to early/mid-stage corporate biotechnology companies. Counsel will discuss complex legal issues facing Soteria Biosciences relating to its R&D, funding, IP ownership, domestic/foreign patent filings, due diligence, confidentiality, and privilege. Stay tuned for more information.

International – David Read and Trevor Davies ● Glyn Truscott of Carpmaels & Ransford LLP highlights the importance in the UK of ensuring that an Applicant has the right to claim priority from an earlier application… more ● David Read of Bartle Read Intellectual Property brings to our attention Morocco’s unique agreement with the European Patent Office regarding the validation of EP patents… more

Regional/Social – Debora Plehn-Dujowich and Ling Zhong ● We are planning a social event in Seattle with the New Lawyers Committee. If you would like to help, please contact Ling by clicking here.

Feel free to send comments and recommendations to a Committee Leader using the Leader’s email icon or send an email the Chair, Vice Chair, and all Leaders by clicking here .

The Fine Print: These materials are public information and have been prepared solely for educational and entertainment purposes to contribute to the understanding of intellectual property law. These materials reflect only the personal views of the authors and are not a source of legal advice. It is understood that each case is fact specific, and that the appropriate solution in any case will vary. Therefore, these materials may or may not be relevant to any particular situation. Thus, the authors and their organizations cannot be bound either philosophically or as representatives of their various present and future clients to the comments expressed in these materials. The presentation of these materials does not establish any form of attorney-client relationship with the authors or their organizations. While every attempt was made to ensure that these materials are accurate, errors or omissions may be contained therein, for which any liability is disclaimed.

BIOTECH BUZZ Webinars Subcommittee

February 2015

Contributor: Carla Mouta

USPTO Section 101 Guidelines: Part I

On February 12, 2015, Part I of the Webinar on the USPTO Section 101 Interim Guidance finally aired. Online were more than 230 attendees and a total of about 500 people listened to the Webinar. June Cohan, Legal Advisor, Office of Patent Legal Administration of the USPTO, discussed the changes from the Mayo/Myriad March 4, 2014 Guidance and the June 25, 2014 Preliminary Examination Instructions and provided various eligibility examples. For more information, June directed listeners to a new set of Training Slides that the USPTO has posted on their website (http://www.uspto.gov/sites/default/files/documents/training%20-%202014%20interim%20guidance.pdf). She also alluded to upcoming examples on the field of diagnostics, which should issue after the Sequenom decision, and highly recommended interviews with the Examiner, in the presence of their supervisor/SPE, should one be dealing with 101 rejections. At the end, June fielded a large number of questions from the listeners including “how shall we determine the closest naturally occurring counterpart,” which she admitted to be subjective, “what is the case law basis for the stream-lined analysis,” which she admitted to be an authority given to the USPTO by the case law treatment of situations where the claims are not directed to a judicial exception, and a persistent inquiry seeking confirmation that claims directed to methods of treatment are not directed to a judicial exception even though it can be said that they relate to a natural law. Donna Meuth discussed a number of original examples and practical tips on how to overcome potential 101-based rejections in the Biotech area. Sarah Knight and Michael Stein shared their experience with the Interim Guidance and software and business methods-related inventions. All speakers were asked a number of additional questions by the listeners which offered additional insight and clarification on the effects of the Interim Guidance in patent prosecution and litigation. Overall, it was a terrific presentation which engendered very thoughtful discussions.

Nothing herein should be construed as legal advice or legal representation. Click here for an expanded disclaimer.

http://www.finnegan.com/CarlaMouta/ Carla Mouta, an Associate at Finnegan LLP, focuses on drafting and prosecuting patent applications in the fields of biotechnology and biosimilars, client counseling, and patent portfolio management. Her patent prosecution experience is focused on patents directed to protecting antibody-related inventions, methods of diagnosis and treatment, and transgenic technologies. Dr. Mouta also has experience with stem-cell and regenerative medicine-related technologies, particularly in the vascular and organ repair areas.

BIOTECH BUZZ Biosimilars Subcommittee February 2015

Contributor: Noel Courage

Getting European Regulators Update Guideline on Protein Biosimilars

The European Medicines Agency (“EMEA”) has provided updated guidance on obtaining protein biosimilar approvals. This document is called “Guideline on similar biological medicinal products containing biotechnology-derived proteins as active substance: non-clinical and clinical issues” (EMEA/CHMP/BMWP/42832/2005 Rev1). This follows circulation of a draft to industry for comment in 2013. The new guideline is effective July 1, 2015.

The document provides the non-clinical and clinical requirements for a biosimilar to be approved for marketing in Europe. The guidance is significant because other regulators often look to the EMEA criteria - Europe is a leader in developing criteria for biosimilar approvals. The revised guidance emphasizes conducting non-clinical and clinical studies in a stepwise manner and outlines recommended approaches. The non-clinical requirements include analytical studies and pharmaco-toxicological studies. Analytical studies, such as assessing target binding and functional effects, should be comparative, showing similarity to the reference (brand name) drug. The assays and data required will depend on the product class. The studies must show that in vitro assays are representative/predictive of clinical effects. The clinical section addresses the requirements for pharmacokinetic, pharmacodynamic, and efficacy studies. It also addresses clinical safety. The clinical portion of the revision addresses, for example, study design, choice of patient population and endpoints in efficacy trials. Safety is also addressed, including risk management, pharmacovigilance and immunogenicity study design (the EMEA has a separate guidance document on immunogenicity studies). Providing data to support extrapolation of safety and efficacy is also addressed, which is a particular point of interest. The approved reference product may have multiple

therapeutic indications. Biosimilar companies typically want to demonstrate biosimilarity in one indication and extrapolate the clinical data to other indications. For example, in September 2013, the EMEA approved Europe’s first biosimilar antibody. The drug was Inflectra which is a biosimilar of Remicade (infliximab), an anti-TNF-α antibody to treat autoimmune diseases. Remicade sales in Europe were over US$2 billion in 2012. The EMEA was willing to fully extrapolate from the limited clinical data set in the Inflectra drug submission to all the other approved previously approved indications for the reference product. As a result, Inflectra was approved in Europe for the treatment of inflammatory conditions including rheumatoid arthritis, Crohn's disease, ulcerative colitis and psoriasis. The situation was different in Canada, where the regulator, Health Canada, did not permit extrapolation to Crohn's disease and ulcerative colitis. The type of guidance provided by the EMEA will assist biosimilar manufacturers to obtain approval and extrapolate indications, but it is up to manufacturers to make sure they have a suitably strong data set to take internationally when seeking approval.

Noel Courage is a partner in Bereskin & Parr LLP's Biotechnology & Pharmaceutical practice group in Toronto, Canada.

BIOTECH BUZZ Industrial Biotech Subcommittee

February 2015

Contributor: Judith Roesler

Butamax™ Advanced Biofuels LLC v. Gevo, Inc., Certiorari Summary Disposition, 13-1286, January 26, 2015, 574 U.S. ___ (2015)

Summary

On January 26, 2015, the Supreme Court granted the petition for a writ of certiorari in Butamax Advanced Biofuels LLC v. Gevo Inc. (“Butamax”) and remanded the case for further consideration in light of Teva Pharmaceuticals USA, Inc., v. Sandoz., Inc., 574 U.S. ___ (2015) (“Teva Pharmaceuticals”). At issue was the review of claim construction de novo by the Court of Appeals for the Federal Circuit (the “CAFC”) in February 2014 as compared to the “clear error” standard of review recently set forth by the Supreme Court in Teva on January 20, 2015.

Background

Butamax is a joint venture between E.I. DuPont de Nemours and Co. and BP Biofuels North America LLC formed in 2009 with the goal of producing renewable fuel technologies. Gevo is also active in renewable fuel technologies. Both Butamax and Gevo are engaged in the production of isobutanol through biosynthesis using plant materials. Isobutanol has a high energy content and can be blended with fossil fuel.

The patents-in-suit, U.S. Patent Nos. 7,851,188 (“the ‘188 Patent”) and 7,993,889 (the ‘889 Patent”) are assigned to Butamax. The ‘889 Patent is a divisional of the ‘188 Patent. Claim 1 of the ‘188 Patent is directed to a recombinant microbial host cell comprising heterologous DNA molecules encoding polypeptides that catalyze substrate to product conversions, with the conversions recited in four steps and the polypeptides for each conversion also recited. The enzymes set forth in Claim 1 of the ‘188 Patent include, among other things, the EC (Enzyme Commission) number for each recited polypeptide. Claim 1 of the ‘889 Patent is directed to a method for producing isobutanol from a recombinant yeast microorganism expressing an engineered isobutanol biosynthetic pathway, with the conversions and the enzymes utilized for five conversion steps included in the claim language. The enzymes set forth in Claim 1 of the ‘889 Patent do not include an EC number.

Butamax sued Gevo on January 14, 2011 and later moved for a preliminary injunction based upon the ‘889 Patent. One of the issues appealed to the United States Court of Appeals, Federal Circuit (“Federal Circuit”) concerns claim construction for one of the recited steps of the biosynthetic pathway in the ‘889 Patent. Although the EC number was not recited in Claim 1 of the ‘889 Patent nor was any dependence on a coenzyme such as NADPH or NADP recited in the claim, the district court construed the claim as “an enzyme known by the EC number 1.1.1.86 that catalyzes the conversion of acetolactate to 2,3-dihydroxyisovalerate and is solely NADPH-dependent.”

Federal Circuit Decision (Case No. 2013-1342; Decided February 18, 2014)

Butamax appealed the final judgment entered against it following the district court’s decisions on a number of motions and the district court’s claim construction. The Federal Circuit accepted the appeal and reviewed claim construction de novo. On February 18, 2014, the Federal Circuit (before Chief Judge Rader, Linn and Wallach, Circuit Judges) found that the district court erred in its claim construction and vacated the district court’s denial of Butamax’s motion for summary judgment of infringement of the ‘188 Patent and the ‘889 Patent and its grant of Gevo’s motion of noninfringement under the doctrine of equivalents. In response, Gevo filed a petition for a Writ of Certiorari with the Supreme Court to vacate the decision of the Federal Circuit.

Supreme Court Certiorari Summary Disposition (Case No. 13-1286; Decided January 26, 2015)

In light of the decision in Teva Pharmaceuticals, the Butamax case was remanded to the Federal Circuit for further consideration on January 26, 2015. In Teva Pharmaceuticals, the Supreme Court held that when reviewing a district court’s resolution of subsidiary factual matters made in the course of its construction of a patent claim, the Federal Circuit must apply a “clear error,” not a de novo, standard of review.

Discussion

The primary claim construction dispute before the Federal Circuit in Butamax concerns whether the enzyme recited in step (ii) of the patent claims must be “NADPH-dependent.” The enzyme in question is the enzyme polypeptide enzyme acetohydroxy acid isomeroreductase (also known as “KARI”). To accomplish the conversion, KARI requires a cofactor as an electron source. Two such cofactors are NADH and NADPH. According to the district court record, Gevo uses mutant KARI enzymes that when using NADH as a cofactor exhibit significantly lower Km (Michaelis-Menten constant) for the conversion of acetolactate to 2,3-dihydroyisovalerate in their isobutanol process.

Claim 1 of the ‘889 Patent is reproduced below.

1. A method for producing isobutanol comprising;

a. providing a fermentation media comprising carbon substrate; and

b. contacting said media with a recombinant yeast microorganism expressing an engineered isobutanol biosynthetic pathway wherein said pathway comprises the following substrate to product conversions;

i. pyruvate to acetolactate (pathway step a);

ii. acetolactate to 2,3-dihydroxyisovalerate (pathway step b);

iii. 2,3-dihydroxyisovalerate to .alpha.-ketoisovalerate (pathway step c);

iv. α-ketoisovalerate to isobutyraldehyde (pathway step d); and

v. isobutyraldehyde to isobutanol (pathway step e);

and wherein

a) the substrate to product conversion of step (i) is performed by an acetolactate synthase enzyme;

b) the substrate to product conversion of step (ii) is performed by an acetohydroxy acid isomeroreductase enzyme;

c) the substrate to product conversion of step (iii) is performed by an acetohydroxy acid dehydratase enzyme;

d) the substrate to product conversion of step (iv) is performed by a decarboxylase enzyme; and

e) the substrate to product conversion of step (v) is performed by an alcohol dehydrogenase enzyme; whereby isobutanol is produced.

The district court considered the patents’ specifications, prosecution histories, and the extrinsic evidence such as expert testimony and the EC enzyme classification system and other enzyme databases. It concluded that in the “state of the art,” the KARI enzyme known by the EC number 1.1.1.86 was generally understood to be NADPH dependent.

In reviewing the district court’s decision, the Federal Circuit considered (i) the plain meaning of KARI; (ii) the specification and claims; (iii) prosecution history; (iv) extrinsic evidence; and (v) claim construction, as summarized in brief below.

(i) The Federal Circuit found that the plain meaning of KARI itself imposes no limitation on the cofactor for the conversion of acetolactate to 2,3-dihydroxyisovalerate.

(ii) In the specification, the patentee offered a definition of KARI but it is disputed whether the definition “clearly expresses an intent” to refine KARI in a way that differs from the plain and ordinary meaning. The specification indicated that the definitions were intended for interpretation of the claims and specification. The specification then went on to generally describe KARI as an enzyme that catalyzes the conversion of acetolactate to 2,3-dihydroxyislovaerate using NADPH as an electron donor. The Federal Circuit found that the use of the phase “using NADPH” in the specification did not mean “only use NADPH” or “NADPH-dependent” as argued by Gevo.

The Federal Circuit also found that the district court’s claim construction improperly excluded a preferred embodiment described in the specification where KARI from Methanococcus maripaludis SEQ ID NO: 183 is taught as “able to utilize NADH as well as NADPH.”

(iii) The prosecution history showed the patentee defending against enablement rejections by referring the Patent Office to the EC numbers and examples of enzymes provided in the specifications. The Federal Circuit did not consider the statements to warrant any limitation of the claimed KARI as being NADPH-dependent.

(iv) In considering extrinsic evidence, the Federal Circuit found that a subsequent patent filing by Butamax which taught a “discovery of a KARI enzyme that can use NADH as a cofactor as opposed to NADPH would be an advance in the art” was subsequent extrinsic evidence that did not clearly express an intent at the time of the invention to refine KARI to use one cofactor over another.

(v) The Federal Circuit construed the term “acetohydroxy acid reductoisomerase” as “an enzyme, whether naturally occurring or otherwise, known by the EC number 1.1.1.86 that catalyzes the conversion of acetolactate to 2,3-dihyroxyiosvalerate.

On remand, the Federal Circuit will be required to use the “clear error” standard of review in Butamax.

Conclusion

In Teva Pharmaceuticals, the Supreme Court explained how the “clear error” rule must be applied (Slip Op. Pp 11-14). The use of intrinsic evidence and extrinsic evidence by the district court impacts the standard of review. In those situations when the district court reviews only evidence intrinsic to the patent, the judge’s determination is solely a determination of law and thus the court of appeals will review that construction de novo. In those situations where the district court needs to consult extrinsic evidence in order to understand the meaning of a term during the relevant time period, and where those subsidiary facts are in dispute, courts will need to make subsidiary factual findings about the extrinsic evidence. To overturn the judge’s resolution of an underlying factual dispute, the appellant court must find that the judge, in respect to those factual findings, has made a “clear error.” In Butamax, for example, extrinsic evidence such as expert testimony and the EC enzyme classification system and other enzyme databases, will be reviewed with the “clear error” standard. It should be noted that the ultimate construction of the claim remains a legal conclusion that the appellate court can review de novo per the Supreme Court opinion in Teva Pharmaceuticals. (Pp 14).

Nothing herein should be construed as legal advice or legal representation.

BIOTECH BUZZ PTAB Actions Subcommittee

February 2015

Contributors: Malaika D. Tyson and Robert F. Kappers

Merial Ltd. v. Virbac, IPR2014-01279 (PTAB)

Summary On January 22, 2015 the Patent Trial and Appeal Board (“the PTAB”) denied institution of inter partes review holding that that Merial Limited (“Merial”) did not establish a reasonable likelihood of prevailing on its challenge of the claims of U.S. Patent No. 8,501,799 (“the ’799 patent”) Background The ’799 patent relates to antiparasitic pharmaceutical compositions for treating flea infestation on pets. In August 2014 Merial filed a Petition to institute an inter partes review of all of the claims (1-15) of the ’799 patent. In October 2014, with permission of the PTAB, Merial filed a revised petition. Vibrac submitted both a preliminary response (November 2014) and supplemental response (December 2014).

In their petition, Merial put forth three grounds to support the unpatentable of claim 1-15 of the ’799 patent under 35 U.S.C. § 103.

Decision

The PTAB determined whether to institute trial based on the two requirements in

claim 1 of the ’799 patent relating to alcohols – (1) a glycol must be present in the claimed composition and (2) the claimed composition cannot include at least methanol, absolute ethanol, or isopropanol.

Ground 1

Merial’s first ground maintained that claims 1-15 were unpatentable under 35 U.S.C. § 103 over Huet in view of Saito alone, or in further view of Bonneau. The PTAB

held that Bonneau, which was relied on by Merial to in order to establish facts associated with the results of experimental testing, was not prior art as it was published after the ’799 patent’s filing date.

Excluding Bonneau from their analysis the PTAB found that the main difference

between Huet, which disclosed a liquid carrier vehicle, and the subject matter of claim 1 of the ’799 patent is that “claim 1 excludes the presence of methanol, ethanol, and isopropanol, whereas Huet requires a co-solvent selected from the group consisting of methanol, ethanol, and isopropanol.” Id. at 16.

To overcome these differences Merial relied on Saito, which discloses a

composition useful for treating fleas. While the PTAB considered that Saito could teach other solvents (e.g., ethanol and benzyl alcohol) it did not find it “apparent that Saito is discussing co-solvents in the sense that ‘co-solvents’ are discussed by Huet.” Id. at 19. The PTAB went on to conclude that “given the difference purposes for which the Saito solvent and Huet co-solvent are used, the evidence does not support a finding that [the disclosed alcohols] would be ‘equivalents’ insofar as the co-solvent of Huet is concerned.” Id.

Because teachings of Saito do “not provide a satisfactory underpinning to

support a rationale that one skilled in the art would have considered” the disclosed alcohol a suitable co-solvent for the Huet reference the PTAB held that Merial had not established a reasonable likelihood it would prevail on showing that claims 1-15 of the ’799 patent are obvious. Id. Ground 2

Merial’s second ground maintained that claims 1-15 were unpatentable under 35 U.S.C. § 103 over Huet in view of Sirinyan alone, or in further view of Bonneau.

Sirinyan describes compositions for controlling parasites on animals. Merial

argued that Sirinyan disclosed a flea-treating composition that could be made with fipronil and DGME (components of claim 1 of the ’799 patent) without any need for a methanol, ethanol, or isopropanol “co-solvent.” Merial then reasoned it would have been obvious to make a Huet composition without one of these alcohols. The PTAB disagreed concluding that Merial had not “identified persuasive evidence that would have provided a reason for eliminating” these alcohols from Huet. Id. at 22.

Because it was not clear “why one skilled in the art would have expected a

combination of ingredients disclosed in Huet and Sirinyan” absent one of these alcohols would have produced a composition which would dry without crystallization the PTAB held the PTAB held that Merial’s second ground also had not established a reasonable likelihood it would prevail on showing that claims 1-15 of the ’799 patent are obvious. Id.

Ground 3

Vibrac argued that Merial’s petition was just a reargument of matter considered by the Examiner. Under 35 U.S.C. § 325(d) the Director has discretion to consider and reject a petition because the same or substantially same prior art or arguments were previously presented to the Office. The PTAB agreed with Vibrac and using this discretion the PTAB denied the petition based on Merial’s third ground finding that the same or similar arguments were previously considered during the ex parte examination of the ’799 patent.

Par Pharmaceuticals, Inc., Roxane Laboratories, Inc., and Amneal Pharmaceuticals, LLC v. Jazz Pharmaceuticals, Inc., CBM2014-00149, CBM2014-00150, CBM2014-

00151, & CBM2014-00153 (PTAB)

Summary

The Patent Trial and Appeal Board (“PTAB”) issued a Decision on January 13, 2015, denying institution of covered business method review of four patents directed to methods for controlling access to prescription drugs prone to potential abuse or diversion.

Background

Par Pharmaceutical, Inc., Roxane Laboratories, Inc., and Amneal Pharmaceuticals, LLC (collectively, “Par”) filed several Petitions, including Petitions for covered business method review, seeking to invalidate a family of patents owned by Jazz Pharmaceuticals, Inc. (“Jazz”). (CBM2014-00149 (Paper 1); CBM2014-00150 (Paper 4); CBM2014-00151 (Paper 1); CBM2014-00153 (Paper 4).) The challenged patents, U.S. Patent No. 7,895,059 (“’059 patent”), U.S. Patent No. 8,457,988 (“’988 patent”), U.S. Patent No. 7,668,730 (“’730 patent”), and U.S. Patent No. 8,589,182 (“’182 patent”), each relate to methods for controlling access to sensitive prescription drugs to guard against potential abuse and unauthorized diversion.

Decision

Because the challenged patents in each Petition are related and each case raises the same jurisdictional issue, the PTAB primarily focused on the ’730 patent and issued one Decision to be entered in each case. Claim 1 of the ’730 patent is illustrative of the claimed subject matter and is reproduced below.

1. A computerized method of distributing a prescription drug under exclusive control of an exclusive central pharmacy, the method comprising:

receiving in a computer processor all prescription requests, for any and all patients being prescribed the prescription drug, only at the exclusive central pharmacy from any and all medical doctors allowed to prescribe the prescription drug, the prescription requests containing information identifying patients, the prescription drug, and various credentials of the any and all medical doctors; requiring entering of the information into an exclusive computer database associated with the exclusive central pharmacy for analysis of potential abuse situations, such that all prescriptions for the prescription drug are processed only by the exclusive central pharmacy using only the exclusive computer database; checking with the computer processor the credentials of the any and all doctors to determine the eligibility of the doctors to prescribe the prescription drug; confirming with a patient that educational material has been read prior to shipping the prescription drug; checking the exclusive computer database for potential abuse of the prescription drug; mailing the prescription drug to the patient only if no potential abuse is found by the patient to whom the prescription drug is prescribed and the doctor prescribing the prescription drug; confirming receipt by the patient of the prescription drug; and generating with the computer processor periodic reports via the exclusive computer database to evaluate potential diversion patterns.

In each Petition, Par asserted that the claims of each patent were unpatentable

under 35 U.S.C. §§ 101, 102, and 103. However, the PTAB declined to institute trial because it determined that Par had failed to demonstrate that each patent was a “covered business method patent” pursuant to the statutory definition in § 18(d)(1):

For purposes of this section, the term “covered business method patent” means a patent that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service, except that the term does not include patents for technological inventions.

The PTAB emphasized to determine whether a patent falls within the definition of

“covered business method patent,” the PTAB’s “focus is firmly on the claims.” With regards to the claims of the challenged patents, the PTAB found “[t]he patent claims

recite a method for controlling access to prescription drug to guard against ‘potential abuse’ or ‘diversion;’ they do not recite a financial product or service.”

For example, the claim language does not recite or require (i) the sale of a prescription drug, (ii) processing of payments, benefits, or insurance claims related to the sale of a prescription drug, (iii) a method of insuring a patient or determining the cost of insurance, (iv) a method of determining the cost of prescription benefits, (v) a method of facilitating payment of health care benefits, or (vi) the extension of credit for the purchase of a prescription drug.

The PTAB rejected Par’s arguments that the patents were subject to covered business method review because each patent is merely “used in commerce” because such a reading not supported by the plain language of the statute or the legislative history. The PTAB also found Par’s reliance on the classification of the patents in Class 705, subclass 2, which includes “billing systems based on entered medical codes,” to be unpersuasive.

In the end, the PTAB denied Par’s petitions for covered business method review of the ’059, ’988, ’730, and ’182 patents, finding that it lacked jurisdiction because the claims of each patent did not recite a financial product or service. This decision comes after further development in related district court litigation between Jazz and Par, where Par will now be forced to litigate the validity of the challenged patents. See Jazz Pharms., Inc. v. Roxane Labs., Inc., 2:10-cv-6108 (D.N.J.); Jazz Pharms., Inc. v. Amneal Pharms., LLC and Par Pharm., Inc., 2:13-cv-391, 2:13-cv-7884 (D.N.J.); Jazz Pharms., Inc. v. Ranbaxy Labs. Ltd., et al., 2:14-cv-4467 (D.N.J.).

Nothing herein should be construed as legal advice or legal representation. Click here for an expanded disclaimer.

Malaika D. Tyson, Ph.D. is an associate at McAndrews, Held and Malloy. She is a registered patent attorney with a background in bioanalytical chemistry and biotechnology. She may be reached at mtyson@mcandrews-ip.com.

Robert F. Kappers is an associate at McAndrews, Held and Malloy in Chicago. He is a registered patent attorney with a background in chemical and biomolecular engineering. He may be reached at rkappers@mcandrews-ip.com.

Both may also be reached at 312-775-8000.

BIOTECH BUZZ Biotech Agents Subcommittee February 2015

Contributor: Angie Sebor

Notice of Roundtable and Request for Comments on Domestic and International Issues Related to Privileged Communications Between Patent Practitioners and

Their Clients

This Notice should be of particular interest to the Biotech Agents, and also to our Committee as a whole:

AIPLA is considering providing comments to the Federal Register Notice titled above. While the internal deadline for providing comments for consideration by the AIPLA Board has passed, you can still review the Notice and provide written comments directly to the USPTO by February 25th. There will also be a Roundtable on this issue on February 18th, 2015 from 10:30am-12:30pm, at the USPTO Madison Auditorium, Madison Building, 600 Dulany Street, Alexandria, Virginia 22314.

A copy of the Notice can be found here: http://www.gpo.gov/fdsys/pkg/FR-2015-01-26/pdf/2015-01241.pdf

Summary from the Notice: The USPTO is seeking input on issues regarding protections from disclosure for communications between patent applicants and their advisors. The issues include: whether and to what extent U.S. courts should recognize privilege for communications between foreign patent practitioners and their clients; the extent to which communications between U.S. patent applicants and their non-attorney U.S. patent agents should be privileged in U.S. courts; and whether and to what extent communications between U.S. patent practitioners and their clients should receive privilege in foreign jurisdictions. (emphasis added)

The USPTO “Ask” from the Notice:

The USPTO is particularly interested in the following topics that focus on three different aspects of privileged communications affecting U.S. entities:

1. First, the USPTO is interested in the state of U.S. law with respect to protecting communications between patent applicants and their non-U.S. patent practitioners from disclosure in U.S. litigation.

2. Second, the USPTO is interested in how foreign courts treat communications between U.S. patent agents or attorneys and their clients.

3. Third, the USPTO is interested in the extent and nature of protection, if any, that U.S. courts accord to communications between clients and their non-attorney U.S. patent agents.

The USPTO also requested information identifying how user organizations are impacted by privilege issues (e.g., whether they are patent attorneys, agents, owners, licensees, or any other type of entity).

Several additional specific questions are posed in the Notice. For future developments on this issue, stay tuned…

Nothing herein should be construed as legal advice or legal representation. Click here for an expanded disclaimer.

Angela Sebor is the Senior Director Intellectual Property for GlobeImmune, Inc., in Louisville, Colorado

1

BIOTECH BUZZ International Subcommittee

February 2015

Contributor: Glyn Truscott, Carpmaels & Ransford LLP

Priority Entitlement in the UK – Idenix v Gilead

The High Court of England & Wales recently decided on the validity of EP(UK) 1 523 489 owned by Idenix Pharmaceuticals, Inc., and alleged infringement by Gilead’s sofosbuvir (Sovaldi®) product.

Mr. Justice Arnold’s comprehensive judgment considers numerous issues of particular interest to Life Sciences patents, including the construction of compound claims and the requirement for a plausible disclosure to enable the invention. This article focuses on the judgment’s discussion of priority entitlement, which highlights the scrutiny applied by the English Courts to determine whether the right to claim priority has been transferred from a priority applicant to the applicant of a subsequent application.

The take-home message is that when an applicant on the first application (e.g. US provisional) is not identical to an applicant on the subsequent application (e.g. PCT), it is advisable for the right to claim priority to be transferred by a written assignment, explicitly transferring the priority right, executed by all parties before the subsequent application is filed.

If a suitable assignment has not been put in place, it may still be possible to establish the subsequent applicant’s title as successor through relevant national law, by operation of law, contract, or in equity. However, as the judge noted in this case, this amounts to “a trial within a trial” involving disputed issues of primary fact, of foreign law and of domestic law. This cost and uncertainty could be avoided by a written assignment.

The issue – was the right to claim priority transferred to the PCT applicant?

In Idenix v Gilead, a prior art PCT publication was available as a novelty-only document (under Article 54(3) EPC / Section 2(3) UKPA) only if entitled to its priority claim from a US provisional application. To decide this matter, the judgment reviews in detail the priority entitlement of this PCT application, applying both US and English law.

2

The US provisional was filed in the name of the inventor who was employed by Pharmasset , Inc., of Georgia (“PG”). However, the PCT application was filed by Pharmasset, Ltd., of Barbados (“PB”). Gilead contended that PB was entitled to claim priority because PB was the inventor’s successor in title by one of three routes: (i) legal assignment from PG to PB by virtue of an R&D agreement between the two companies; (ii) transfer of beneficial interest in the invention to PB; or (iii) that the inventor’s rights were assigned directly to PB as PG’s “designee” under the inventor’s employment agreement, as governed by the law of the State of Georgia.

The legal framework

The judgment turns on the requirement (in Section 5 of the UK Patents Act, Article 87 of the EPC, Article 8 of the PCT and Article 4(A)(1) of the Paris convention), that the right to priority exists for any person who has duly filed an application, or his successors in title.

The judgment sets out that in Edwards Lifesciences AG v Cook Biotech Inc. the High Court found that when the applicant that files the priority-claiming subsequent application “is neither the person who filed the earlier application nor his successor in title then he is denied the privilege. Moreover, his position is not improved if he subsequently acquires title to the invention. It remains the case that he was not entitled to the privilege when he filed the later application and made his claim”.

The judge also notes his own earlier decision in KCI Licensing Inc. v Smith & Nephew Plc,, where the right to claim priority from a US application was effectively assigned by virtue of a confidentiality agreement signed by the inventor. Although the agreement was governed by the law of the State of Texas, USA, the parties were content to proceed on the basis that that law was the same as English law. This judgment found that “when determining whether a person is a 'successor in title' for the purposes of the provisions, it must be the substantive rights of that person, and not his compliance with legal formalities, that matter”.1

In the current case, the inventor’s employment agreement (with PG) provides that it is governed by the law of the State of Georgia, while the R&D agreement (between PG and PB) required a consideration of state law (for contractual construction) and Federal law (for patent assignment requirements). The judge heard evidence from two experts on US Federal patent law2 and two experts on Georgia State law3, to decide on these

1 A more detailed commentary on KCI Licensing Inc. v Smith & Nephew Plc may be found here. 2 Paul Michel, a former Chief Judge of the United States Court of Appeals for the Federal Circuit, and Professor John Thomas of Georgetown University. 3 Hon Norman Fletcher, a former Chief Justice of the Georgia State Supreme Court, and Hon Stanley Birch Jr. formerly a Circuit Judge of the 11th Circuit Court of Appeals.

3

issues of US law. Some issues of US law were agreed by the experts, while others were disputed – including whether or not there can be equitable title to priority.

The decision

All three of Gilead’s proposed routes were held to transfer PG’s rights in the provisional application to PB (the PCT applicant), such that the priority claim was held to be valid.

The judge applied US law to decide how the agreements should be construed and what sort of title had been transferred (legal, equitable or none). He found that (i) legal title had passed to the PCT applicant by virtue of the R&D agreement. The judge also held that (ii) even if the PCT applicant was not the legal owner, it was the equitable owner under US law. Route (iii) is also confirmed, with the judge seeing no reason why the agreement cannot take effect through the mechanism of designation.

The judge applied English law, summarized above, to determine whether the equitable title (which he concluded arose under US law) was sufficient to make PB a “successor in title” under English law for the purposes of determining the validity of the priority claim for the PCT/UK patent. He found that this was indeed enough. Notably, the judge was not interested in whether the PCT applicant, as an owner in equity, was a “successor in title” under US law; US law only applied to the analysis of the agreements.

Comments

The absence of a clear transfer of the right to claim priority caused an extensive - and no doubt expensive - “trial within a trial”. This might have been avoided by an explicit assignment of the priority right to PB, before the PCT application was filed.

This judgment applies a two-stage enquiry - firstly to determine whether the agreements effectively assign the right to claim priority under the law governing those agreements, and secondly to determine whether a valid claim to priority has been made according to the law of the country in which litigation is taking place (taking account of international treaties). Applying this approach to cases where there is only an equitable transfer of the right to claim priority could result in priority entitlement being denied in European states that do not recognize the common law notion of equitable title.

Nothing herein should be construed as legal advice or legal representation. Click here for an expanded disclaimer.

Glyn Truscott | Carpmaels & Ransford LLP | @CRPharmaIP

1

BIOTECH BUZZ International Subcommittee

February 2015

Contributor: David Read, Bartle Read Intellectual Property

Morocco to validate European patents

Morocco is the first country that is not signed up to the European Patent Organisation to validate European patents.

Starting on 1 March 2015, anyone filing a European patent application (direct European patent applications or international applications designating the EPO) will be able to request validation for Morocco. European applications and patents validated for Morocco will have the same legal effects as would a Moroccan application or patent and will be subject to Moroccan patent law.

Nothing herein should be construed as legal advice or legal representation. Click here for an expanded disclaimer.

David Read is a leading European patent attorney in the life sciences and director of Bartle Read. http://www.bartleread.co.uk/about-us/

@BartleRead