Patent Baristas

The Supreme Court heard oral arguments in a case asking whether companies can sue to invalidate another’s patent even when they don’t face an infringement suit, a case that may affect thousands of drug and biotechnology inventions. The case, MedImmune, Inc. v. Genentech, Inc. et al. (No. 05-608), looks at whether a company must stop paying royalties on a patent license to challenge the validity of the patent. MedImmune is paying licensing fees to Genentech for an antibody technology used in MedImmune’s pediatric respiratory drug Synagis, while at the same time challenging Genentech’s patent in court.

The patents at issue, U.S. Pat. Nos. 4,816,567 and 6,331,415, relate to antibodies and to non-specific immunoglobulins formed by recombinant techniques using host cell cultures. The antibodies can be manipulated at the genomic level to produce chimeras of variants, which draw their homology from species, which differ from each other. They can also be manipulated at the protein level, since all four chains do not need to be produced by the same cell.

Genentech argued that the federal courts do not have jurisdiction over the case without a breach of contract or other actual dispute between the two parties. By paying royalties, MedImmune has acknowledged the validity of the patent, Genentech said in court briefs, and as a result there is no actual dispute in the case. Instead, the company argues that MedImmune is essentially seeking an advisory opinion about how it would fare legally if it broke the contract, which the court cannot provide. Under the Constitution, the federal courts do not have jurisdiction to rule on hypothetical questions.

The Court is reviewing the Federal Circuit decision that a licensee may not use a declaratory judgment action to challenge the validity of the licensed patent where the licensee is paying royalties and observing the terms of the patent license agreement. The Federal Circuit ruling rejected the view that licensee rights established under Lear v. Atkins, 395 U.S. 653 (1969), permit the validity challenge, stating that this case is governed not by the bar against licensee estoppel, but by the Constitution’s requirement of a case or controversy.

MedImmune, a licensee of a patent owned by Genentech, sought a declaratory action to challenge the validity and enforceability of the licensed patent on various grounds flowing from the settlement of a patent interference between Genentech and Celltech R&D, Ltd. The U.S. District Court held that because MedImmune continues to comply fully with the license terms, leaving no possibility of infringement suit or license cancellation by Genentech, there is no “case of actual controversy” as required by the Declaratory Judgment Act, 28 U.S.C. §2201. The district court also dismissed MedImmune’s antitrust and unfair competition counts claiming that Genentech illegally obtained a patent on an antibody synthesis technology used in the production of Synagis, a MedImmune drug that prevents certain respiratory infections in babies. The U.S. Court of Appeals for the Federal Circuit affirmed (See MedImmune Inc. v. Genentech, 04-1300, -1384).

MedImmune, meanwhile, argues that to breach its contract with Genentech would expose it to potentially significant damages for patent infringement and could also result in an injunction halting sales of Synagis, which brought in over $1 billion in revenue in 2005. MedImmune says that it is paying the royalties only under protest and that federal law and previous court cases allow it to challenge the patent without suffering the negative consequences of halting royalty payments.

While some argue that allowing a company to challenge a patent while continuing to pay licensing fees reduces the risks to companies like MedImmune and could encourage more disputes and could destabilize thousands of existing patent settlements and license agreements, Justice Anthony Kennedy expressed a concern that this could “flood the courts” with lawsuits. On the other hand, others believe that allowing companies to continue to pay royalties while disputing patents could bring more challenges of bad patents. Chief Justice John G. Roberts Jr. asked, if firms could always sue over patents they had agreed to respect, then “How do you ever end these things?”

The case has lined up a good number of supporters on both sides. MedImmune is supported by the Generic Pharmaceutical Association and by the current administration while Genentech is backed by the Pharmaceutical Research and Manufacturers of America, Qualcomm Inc., 3M Co., General Electric Co., Procter & Gamble Co. and DuPont Co. A decision is expected by July. With concerns raised on the merits of both sides, the case is too close to call.

In the meantime, the U.S. Patent and Trademark Office is reviewing Genentech’s Cabilly patent under concurrent proceedings for an Inter Partes Reexamination (RE Appl. No. 90/007,542) and an Ex Parte Reexamination (RE Appl. No. 90/007,859). In an earlier ruling, the U.S. Patent and Trademark Office (USPTO) issued an obviousness-type double-patenting rejection and a “Schneller-type” double patenting rejection on the Genentech patent indicating that the patent, awarded in 2001, covered basically the same invention as an earlier Genentech patent that was set to expire next March.

MedImmune is now claiming that Genentech and Celltech conspired improperly to secure for themselves, through 2018, a dominant and exclusive position in the recombinant antibody field. As we’ve said before, it’s too early to try to predict the outcome so it is not clear yet if companies developing recombinant antibody-based products will become free and clear of the Boss and Cabilly patents anytime soon.

See more at: Patently-O and SCOTUS Blog.

The U.S. Patent and Trademark Office (USPTO) announced it will re-examine patents covering embryonic stem cell discoveries made by University of Wisconsin researchers. The patents, US Pat. Nos. 5,843,780, 6,200,806, and 7,029,913, cover all embryonic stem cell research in the U.S. The USPTO could revoke, modify or leave intact the patents but any such action could be months to several years away.

The request for reexamination was made by two nonprofits, the Foundation Taxpayer and Consumer Rights (FTCR) and the Public Patent Foundation (PUBPAT), who believe that the patents are impeding scientific progress and driving vital stem cell research overseas. They argue that the work done by University of Wisconsin researcher James Thomson to isolate stem cell lines was obvious in the light of previous scientific research, making the work unpatentable.

Dr. Jeanne Loring, a stem cell scientist at the Burnham Institute for Medical Research, had filed a statement supporting the challenge stating that: “The real discovery of embryonic stem cells was by Martin Evans, Matt Kaufman, and Gail Martin in 1981, and none of these scientists considered patenting them. It is outrageous that WARF claimed credit for this landmark discovery nearly 15 years after it was made. ”

The Wisconsin Alumni Research Foundation (WARF), a nonprofit group that acts as UW’s tech transfer office, has dismissed the challenge from the two groups as financially and politically motivated at a time when California is hoping to become the leader in the field with a $3 billion grant program. That is, California voters approved Proposition 71,which allocated $3 billion in grants over the next 10 years.

But, I don’t think anyone should go out a throw a party just yet. The patent office grants over 90 percent of the requests for reexamination and many of those patents are issued with substantially the same claims as before reexamination. This issue could take years to resolve.

Still, a lot of money is at stake. WARF has made free licenses and cells available to more than 300 academic research groups but charges companies as much as $400,000. WARF also claims royalties from products produced using the patents. Wisconsin has even announced that companies who fund work at universities and nonprofits in Wisconsin will not have to pay licensing fees.

A legislative ban on using money from Ohio’s Third Frontier Program for embryonic stem cell research was vetoed by Governor Taft. The ban sought to prohibit funding for research even on the pre-existing stem cell lines currently allowed by federal regulations. Taft did, however, issue an executive order saying that stem cell research from the program must follow guidelines for existing cells approved for federal funding.

See more here:

Reexamination of ‘780 Patent (90/008,102)
Reexamination of ‘806 Patent (90/008,139)
Reexamination of ‘913 Patent (95/000,154)

Copies of the challenges filed by FTCR and PUBPAT.

Welcome to the Autumnal Edition of Blawg Review, hosted this week by the Patent Baristas. We’re always glad to have people over to visit so grab a piping hot spiced latte and we’ll see what’s been going on around the blogosphere.

Here in Cincinnati, OH, autumn is by far the best season with a drop in humidity and temperatures along with all the fall events. Despite some legal woes with the Bengals, it’s a good time to spend some time reflecting on the goings-on in the world.

Without further ado, here is this week’s review:

October Sky

Tom Collins of morepartnerincome (not the drink) has a review that is invaluable to all lawyers. He outlines the six basic law firm metrics that every firm should track. Memorize them.

A useful bit of crossover advice for lawyers comes from David Hornik at VentureBlog pointing out that a little hardship goes a long way. Why? Without pain, there is no resourcefulness. And without resourcefulness, there is no growth.

Larry Bodine’s Professional Services Marketing blog tells how to jump-start cross-selling in your law firm (although we think compensating for cross-selling activities should be moved to #1…and #2…and #3…)

And don’t forget the importance of positive law firm leadership. legal sanity offers leader behaviors that have a positive influence on people’s feelings including providing emotional support; giving positive feedback on their work; and publicly recognizing people for good performance.

The Wired GC writes about Hewlett-Packard’s How to Lose a GC in 10 Days.

Adam Smith, Esq., has a piece on law firm “social network analysis” (SNA). What is SNA, you ask? It’s the creation of network maps analyzing how people in your firm really communicate, through email traffic patterns, for example, and can be deeply revealing.

Evan Schaeffer’s Legal Underground describes the new industry called “associate training and development” for young lawyers who can’t dress themselves, don’t know anything about wine and have covered their bodies with unsightly tattoos.

Turning Leaf

Jonathan D. Frieden highlights the benefits of participation of lawyers in the blogging community in True to Form, Lawyers Blog More than the General Population.

Tracy Coenen gives a brief overview of how executives can get six years in federal prison and two years of full-time community service posted at Sequence Inc..

While David Maister presents More Things in More Places, we think you should also check out BlogTalkRadio.

Kaimipono Wenger at Concurring Opinions writes about Liberation blogology, the thought that bad writers would take to the blogosphere in droves and learn to write succinctly.

Slaw, a co-operative web log about Canadian legal research and IT asks what do you call a law blog in French?

Point of Law’s Ted Frank believes that the bad publicity from food poisoning costs far more than the damages awarded, and Marler Clark’s lawsuits may be more about ambulance-chasing after the injury and problem has been noted than about bringing attention to and correcting dangerous conditions.

Overlawyered wants you to know that in case you imagined that the Equal Employment Opportunity Commission these days was all sweetness and reason with employers in enforcing anti-discrimination law, the Sixth Circuit has now upheld the dismissal of a fired employee’s suit on summary judgment on the grounds that morbid obesity, when not caused by a physiological disorder at least, is not an “impairment” under the Americans with Disabilities Act and now NYC plans to ban trans fats.

Autumn Harvest

Dennis Crouch, over at the Patently-O: Patent Law Blog, has a nice update on Microsoft’s petition for certiorari to the Supreme Court in its battle over transnational patent infringement.

Bill Meade has a guest post at Rethink(IP) on Strong-Non-Obviousness … Trap? I think so …

The Rethink(ip) guys have been busy with additional services including LegalMojo, a job board for legal professionals in all areas of law (not just intellectual property).

The Invent Blog has a nice overview of how to tell if a patent has been litigated over.

The Orange Book blog has developed the Hatch-Waxman Tracker. It is a database of all pending Hatch-Waxman cases and a place where someone could quickly and easily check on the status of all the pending cases at once.

Dennis Kennedy at DennisKennedy.com explains why you should describe blogs in terms of effects rather than technology in Explaining Blogs and RSS: A Primer.

Boris Umansky takes a Closer Look At The “Trademark Dilution Revision Act of 2006”, which was just passed by Congress earlier this week, and President Bush is expected to sign it into law within days.

The Patent Prospector writes that rumors are swirling that the patent office may be rethinking its continuation curtailment campaign. maybe common sense will prevail. Also rife is speculation of upper management shuffling due to due to upcoming presidential elections and the question about whether a Republican or Democrat will take office.

Rite of Fall

Professor Bainbridge asks if Sarbanes-Oxley 404 be fixed (and why it matters – a lot). Consider what’s happened to IPOs: So far this year, there have been just 17 international IPOs on the NYSE and Nasdaq v. 59 with the London Stock Exchange. Section 404 is at the core of the problem.

Jeremy Phillips, on the IPKat Blog, finds feelings are clearly running high over the new UK Patent Office website, writing: Disbelief was the IPKat’s first reaction when he accessed his favourite site, only to find that it had mutated …

John Welch has posted the TTABlog Quarterly Index for July – September 2006.

Ross Dawson at Trends in the Living Networks writes that IBM has announced that it will voluntarily publish its patent filings on the Internet. The upside is that it is taking the lead in creating a clearer, less confused, higher quality patent landscape. The (potential) downside is that it exposes its technology directions and strategy to its competitors as they develop rather than once they’re implemented.

Jonathan Wilson gives an overview of the President’s Identity Theft Task Force. Bottom line: watch out for phishing scams.

Amit Goyal lays out a beginners view on public patent review with Patents 2.0?.

Madeleine Begun Kane offers a Torture Bill Haiku posted at Mad Kane’s Political Madness, a tragic day in U.S. history in 17 syllables.

October Road

The Mommy Blawger discusses the freakiness of the revelation that the father of Anna Nicole Smith’s baby is none other than her lawyer.

Valleywag predicts YouTube’s doom since what makes YouTube great is copyright infringement and it is shifting from “we love our users” to “oh ___ we need to profit.”

Kevin O’Keefe at Real Lawyers Have Blogs likes that the legallyblondepa has a cute MySpace page. He believes that there is a lot to be learned about being real and transparent on the net. Even the Pittsburgh Tribune Review’s David Conti seems smitten with bare shoulders writing that the site “shows a brighter side. Beside the smiling photo of her in a strapless top and information on her body type, dating status and zodiac sign (Taurus), Web surfers will find answers to questions about bankruptcy and links to a free legal consultation.” Whatever.

We could just need more self-help. shlep: the Self-Help Law ExPress has an overview of the Justice Department urging the Supreme Court “to clarify when a non-lawyer parent of a disabled child may file a lawsuit, without a lawyer, to enforce the child’s rights under the Individuals with Disabilities Education Act (IDEA).”

But then, a study published in the Journal of Labor Research shows that people who consume alcohol earn significantly more at their jobs than non-drinkers. Not sure if that means consuming alcohol while at their jobs.

Better to check out Tom and Ray over at Car Talk who’ve posted Tommy’s favorite new lawyer joke.

Lion in Autumn

Patent Baristas have had a rough go at the Legal Bloggers Fantasy Football League, Blawger Bowl III. After drafting a team of underperformers, we’re soundly in 11th place by points. We’ll see how things shake out given the awesome perfomance of Santana Moss and Marques Colston this weekend.

Current Standings:

Rank Team
1. BizzBang Buzzers
2. Your Daddy
3. Jersey Teamsters
4. Raspberry Tort(e)s
5. Arabica Grounds
6. Cert. Denied
7. Tech Law Advisor
8. Loosely Coupled
9. Brkln Drppd Vwls
10. Completely Guessing
11. Draconian Measures
12. 13-3

BB3 is not the only blogger bowl, though. See SoCal Law Blog. But then also see the Biotech Fantasy League and even Concurring Opinion’s Fantasy Law School League.

Although Blonde Justice would prefer the Fantasy Fashion League, BlogHer says bring it on.

A freebie: the very cleverly named Get Free Downloads on the iTunes Store is a one stop shop website for all things free from iTunes. Great for listening while trying to decide whom to pick up on the waiver wire.

Pink for October

Pink For October urges bloggers to Go Pink during the month of October to bring attention to Breast Cancer Awareness Month, get people talking about breast cancer and raise money for research.

Linguist Mark Liberman on Language Log prints a female lawyer’s email about Sex, status and law-office culture as a follow-up to his earlier post about Stereotypes and Facts, and The Female Brain. But, you might want to Fact-Check The Female Brain.

And in a final commentary to one of the Barista’s favorite blog sites, our review would not be complete without a nod to Go Fug Yourself. Fuggers Heather and Jessica critique the gymorexic physique and Crayola-colored skin of Jessica Simpson.

————-
We hope you’ve enjoyed this week’s edition of Blawg Review. Nothing herein should be construed as an endorsement of any product or service. The decision on any inclusion (or not) in the review was completely arbitrary and capricious. Past performance does not guarantee future returns.

Thanks for dropping by and visiting our place. We’ll meet at your place next time.

Blawg Review has information about next week’s host, and instructions how to get your blawg posts reviewed in upcoming issues.

Patent Baristas is hosting an Autumnal Edition of Blawg Review on Monday. Blawg Review is the blog carnival for everyone interested in law with topics discussed by lawyers, law students and law professors. Each weekly issue of Blawg Review is made up of article submissions selected from the best recent law blog posts.

Blawg Review Submission Guidelines:

Deadline for submission is 11:59 p.m. EST on Saturday, Sept 30.

Topics should be of interest to lawyers but can be of interest to normal people, too.

You are welcome to submit blog posts by other people that you’d like to recommend as well as your own self-promotion.

Click on this Blawg Review submission link to submit your article.

We look forward to spending some time together on Monday.

While biotechnology accounts for only 1 percent of the overall healthcare costs, the overall cost of biotechnology is growing faster than the economy along an unsustainable trajectory. Biotech drug sales are expected to top $60 billion by 2010. Still, the cost of biotechnology has to be compared with the cost of the disease in terms of the normal hospitalization and treatment required.

Unfortunately, it still leaves a lot of money for patients to pick up. The Centers for Medicare & Medicaid Services (CMS) recently placed new biotech drugs and therapies in a specialty coverage tier where most drugs are $2,000 to $3,000 a month, with 25 percent paid out-of-pocket by the patient.

Patient pain equates with voter pressure and legislators are looking for some answers. Some of the legislation that is being batted about Washington includes: a faster path to generic versions of the biotech treatments, price negotiation between the government and biotech companies, the creation of a federal agency to assess drug values, and shorter, cheaper, more effective clinical trials to reduce development costs, according to published reports. Some form of these will mostly likely emerge once the issues of safety and off-label use are addressed. Not to mention how to pay for the $20.8 billion in biotechnological research and development spent in the U.S. last year. However, unlimited prices may not be the result even without legislative action.

The American Enterprise Institute for Public Policy Research published an article on “The Emerging Market Dynamics of Targeted Therapeutics” detailing the issues around the price of targeted biotech drugs. Targeted drugs tend not to compete with each other even when treating closely related diseases, which makes them resistant to price controls. However, the same properties that generate premium prices also facilitate inventing around successful drugs, eventually leading to vigorous competition despite the lack of generic alternatives.

AEI reviews the market dynamics of targeted therapeutics and offers a review of some of the market forces that should come to bear in regulating biotech prices in the future:

QALYs: The supply of expensive new biotech drugs to should continue unabated even if payers systematically limit reimbursement to consensus recommendations for how much to pay per quality-adjusted life year (QALY) saved. As long as advanced societies are willing to pay on the order of $50,000 or more per QALY, creative biotechnology firms will find solutions that meet such standards and will price them accordingly.

Post approval research: Research on traditional drugs normally ceases as patent expirations approach but without the prospect of generic entry, research investment on a pioneer biotech drug does not face a natural endpoint.

Pricing conundrums: There seems to be no easy way for manufacturers to avoid the price conundrums (and public outcry) generated when new uses or dosages appear on the market at different price points. Research incentives arise from the full range of a drug’s potential uses including those explored after approval. The inability to practice price discrimination among uses could greatly undermine incentives for both initial development and post-approval research.

Competition through faster inventing-around: Targeted biotech drugs can facilitate competition through classic inventing-around a patented therapeutic the same as with traditional drug categories. New drugs can exploit a proven target in a way that avoids patent infringement while retaining a reasonable prospect of success in clinical trials.

Competition through new uses: A second route to competition through targeting is through post-approval research on how a drug’s activity against a specific target may extend to other therapeutic areas, generating new uses for the drug. Expanded uses for multiple drugs can easily overlap, creating new competitive forces such as occurred with Avastin

Drugs that are just better: Research can aim simply at improving existing therapies through follow-on research. Some next-generation biotech companies are expanding upon existing monoclonal antibody technology by developing longer-lasting and more potent antibodies that are cheaper to manufacture for targets that have been well validated by science and the market.

The report indicates that we can expect the rapid accretion of drugs that provide large benefits, especially for previously poorly treated conditions, but at high prices and, often, significant total expenditures.

See the entire report here.

Assets acquired in today’s private equity and venture deals, mergers and acquisitions, strategic alliances and joint ventures are increasingly intellectual property assets such as patents, copyrights and Internet domain names. Because of the value of these assets, intellectual property due diligence has become an important part of the legal work required for these transactions. Such intellectual property assets consist of (1) “content,” which includes text, visual images (both moving and still), sounds, database information, logos, characters and the like, (2) “technology,” which includes biological chemical compositions and methods, electrical and mechanical devices and software and business methods, and (3) combination hardware and software devices.

Due diligence includes a review of not just the listed intangible assets of a company but also the scope of protection, any defects or clouds on the title, and issues surrounding the use of the claimed asstes. If after the deal a party does not own or have an adequate license to the intellectual property acquired in the transaction, then the acquiring company may face liability for infringement when it uses or sells products or services with the assets it acquired. Therefore, one must carefully consider patent, copyright, trademark and domain name due diligence.

In evaluating patent rights, it is important to note that just because a product or process is patented does not mean it cannot infringe another patent owned by a third party. In fact, patented technologies can and often do infringe other patents. For example, a first company can own a patent on a basic material or component sued to make a device or composition that is patented by a second company. In such a case, the second company cannot sell its product unless it first obtains a license from the first company.

A patent does not grant the patent owner the right to the exclusive right to practice his invention, it grants him the right to exclude others from making, using or selling the patented subject matter. As a result, due diligence should investigate whether licenses from third parties are required for the acquiring company or its customers to use the target company’s technology.
The target company’s patent ownership should be verified by review of U.S. and foreign Patent Office records. Often government records will not reflect assignments shown in corporate documents, and this also needs to be investigated. Patents have a limited term, and the target company must be sure that sufficient useful time remains on the patents to be acquired. Patents rights can lapse if period required fees to keep the patent in force have not been paid.

If any allegations of infringement have been made against the target company’s patent in the past, or if for another reason the acquired company retained patent counsel to issue an opinion letter on the validity of the third party’s patent and/or its infringement, those opinion letters should be obtained and reviewed. Any qualifications in the opinions should be carefully analyzed. Moreover, depending on their date and scope, the opinion letters may need to be updated.

If there are any past or pending infringement suits, relevant litigation documents should be reviewed. If the target party is a defendant, then the likelihood of a judgment of infringement should be assessed as well as the scope of a potential damage award and the impact of any temporary or permanent injunction. Treble damages and attorneys’ fees can be awarded in instances of willful infringement, and these issues must also be evaluated. If the target party is a plaintiff, then there is the risk that its patent may be held invalid in the litigation. Accordingly, the impact of the loss of exclusivity and the loss of the revenue from patent royalties must also be assessed.

The importance of intellectual property assets in venture capital deals, private equity investments and mergers and acquisitions, and especially in deals involving high-technology, place great importance on the time allocated to and the quality of the intellectual property due diligence that should be conducted in such transactions.

Legislators are stepping up the pressure in the long running saga of getting generic versions of biotech drugs to market. The FDA approves generic versions of pharmaceutical (small molecule) drugs once the patents for brand-name products expire. But complex biotech drugs do not have such an approval process.

Representative Henry Waxman and Senator Orrin Hatch gave a talk to the Generic Pharmaceutical Association on the need for legislation that would balance the interests of generic drug makers and brand-name manufacturers who shoulder staggering drug development costs.

Waxman said he plans to introduce a bill to spur the U.S. Food and Drug Administration into action on the long-overdue FDA guidelines for manufacturers to follow to produce generic versions of biotechnology drugs. Hatch, on the other hand, said that the issue is too important to try to pass before the Senate recess, expected at the end of next week. Also see the letter that Hatch and Waxman sent to the FDA earlier this year.

While the FDA has approved Novartis AG’s Omnitrope hormone, there has not been a change in the stance taken by the FDA on generic biotechnology drugs. Omnitrope was approved only after a federal judge ordered the FDA to decide after a long delay. Also, Omnitrope is considered less complicated than most other biologics.

Under both the Federal Food Drug and Cosmetic Act and the Food Prescription Drug User Fee Act, the FDA is required to either approve or reject new drug applications. However, no biogenerics (or follow-on proteins) have yet been approved in the US pharmaceutical market beyond Omnitrope. It is argued that the 505(b)(2) provision of the Hatch-Waxman Act (the Hatch-Waxman amendments of the Federal Food, Drug and Cosmetic Act) lays out an abbreviated approval pathway (ANDA) for generic versions of small molecule drugs) provides a route for the FDA to approve a biological therapy that is different from the originator product, yet relies on data filed by the innovator as part of the original NDA.

The reason for the lack of a regulatory pathway for approval of biogenerics lies in the complexity of the biological products themselves. Biologics are large, complex, heterogeneous molecules for which the manufacturing process can be a determinant of the end product. Demonstrating that a generic version of the product is as safe and effective as the brand name product would be a difficult at best since, for example, establishing that immunogenicity had not been altered and that any undetected differences in the product would not impact safety and efficacy would be problematic without conducting extensive clinical trials.

But the stakes are high, given biotech drug sales are expected to top $60 billion by 2010. Biogeneric companies need an abbreviated approval pathway to avoid undertaking the same large scale clinical development process as the originator companies, and thus allow them to market their product at a discount to the brand while maintaining a healthy profit margin.

With Omnitrope, the FDA, however, went out of its way to say that Omnitrope is not a generic biologic stating that “Omnitrope is not rated as therapeutically equivalent to (and therefore substitutable for) any of the other approved human growth hormone products. Omnitrope is more appropriately characterized as a “follow-on protein product.”

The FDA indicated that the approval of Omnitrope in a 505(b)(2) application does not establish a pathway for approval of follow-on products for biological products licensed under section 351 of the Public Heath Service Act, nor does it mean that more complex and/or less well understood proteins approved as drugs under the Food, Drug, and Cosmetic Act could be approved as follow-on products.

Just the same, brand name biotech companies may want to get a hold of a copy of Cutting Edge Information’s report “Combating Generics: Pharmaceutical Brand Defense for 2007,” which includes strategies to retain market share and defend patents including, among others, patent litigation and authorized generics and corporate generics subsidiaries. (More at Philip Brooks’ Patent Infringement Updates)

If you’ve ever worked with university inventors, you know that the pressure to publish is intense. Sometimes, that drive to publish comes back to bite you.

An invention can only be protected by patent if it is novel (that is, no prior publication of the invention has been made by the inventor or others). While the U.S. allows a one-year grace period, most countries follow a policy of absolute novelty, that is, no patent can be obtained if the invention has been publicly disclosed. Therefore, it is essential not to disclose the invention publicly until after a formal patent application has been filed.

Any printed publication in a newspaper, scientific journal, or other written form available on an unrestricted basis is considered a public disclosure, as is an oral presentation at a public meeting. Note that an abstract and, in some cases, even a title may act to bar patentability if it discloses all the necessary elements of the invention.

This is the result in the recent case where the inventors published an abstract that disclosed the necessary elements of the invention even though they did not appreciate what they had at the time they published.

In Nichols Institute Diagnostics v. Scantibodies (06-1087; September 20, 2006), the Federal Circuit reversed a district court’s grant of summary judgment of no anticipation and held that all of the asserted claims were anticipated under 35 U.S.C. § 102 by an earlier published abstract.

Nichols’ patent, U.S. Patent No. 6,030,790, covered compositions of antibodies that selectively bind to specific peptide sequences of hPTH 1-37, methods of using the antibodies to detect biologically active hPTH, and immunoassay test kits containing the antibodies for detection of biologically active hPTH. Representative claim 17 recites:

A composition comprising an antibody or antibody fragment and a suitable carrier: wherein the antibody or antibody fragment selectively binds a peptide of human parathyroid hormone (hPTH) selected from the group consisting of peptides having SEQ. ID Nos. 1-6.

SEQ. ID Nos. 1-6 being the sequence for hPTH 1-10, hPTH 1-9, hPTH 1-8, hPTH 1-7, hPTH 1-6, and hPTH 1-5, respectively.

Human Parathyroid Hormone (hPTH) is a protein comprised of 84 amino acids that plays an important role in regulating calcium metabolism. Various fragments of hPTH may circulate in the bloodstream; however, to be biologically active, a fragment of hPTH must include the first two amino acids and must be at least 34 amino acids long. The amount of biologically active hPTH may be measured by creating antibodies that bind to specific amino acid sequences of hPTH and then using those antibodies in an immunoassay.

The inventors published an abstract disclosing that they created ten antisera, labeled K1 through K10, each of which contained a mixture of antibodies that bound to specific peptides of a fragment of hPTH that contained amino acids 1 through 37 (represented as hPTH 1-37).

The abstract explained that the disclosed sera “provide the possibility to specifically detect the physiologically circulating fragment of human PTH in serum.” The abstract discloses that some of the sera, labeled K1 through K3, bound predominantly to hPTH peptides having the first two amino acids. Because the antibodies in the K1 through K3 sera bound predominantly to peptides containing the first two amino acids, and the antibodies in the other sera bound to peptides of hPTH containing blocks of amino acid sequences through 37, the sera could be used in combination to specifically detect hPTH fragments that include the first two amino acids and are 37 amino acids long.

The abstract was published and distributed to the public on September 12, 1994. It was not until after that date that the authors of the abstract discovered that, to be biologically active, a fragment of hPTH must have both the first two amino acids and be at least 34 amino acids long. Thus, it was not until after the abstract was published that the authors recognized the significance of the disclosure in the abstract.

On September 22, 1995, they filed the patent application, more than one year after the publication of the abstract.

Basically, the sera disclosed in the abstract contained a mixture of antibodies and the claimed antibody was present in the K2 serum. At trial, the district court concluded that the abstract did not inherently anticipate the claimed antibody because the claimed antibody “differentiates between biologically active and inactive hPTH,” whereas the abstract “does not disclose or suggest the means of differentiating between biologically active and inactive hPTH.”

On appeal, Scantibodies argued that, because it is undisputed that the antiserum disclosed in the abstract contained the claimed antibody, and because it was well known how to isolate the claimed antibody from the other antibodies in the disclosed serum, the abstract inherently anticipates the asserted claims.

The CAFC agreed:

We also hold, for the reasons below, that the abstract anticipates the asserted claims, because no reasonable juror could have found that the abstract does not inherently disclose the claimed antibody. SmithKline, 403 F.3d at 1343. The abstract itself and the testimony of Dr. Magerlein conclusively demonstrate that the abstract expressly or inherently discloses each element of the asserted claims. The abstract states that the authors have obtained antibodies and that “the different regions of hPTH 1-37 are covered by the produced antibodies. Furthermore, the combinations of two antibodies in a two-side assay are tested.” The abstract also discloses that sera mixture K1 through K3, which contains the K2 antibody (and) … the claimed antibody was isolated from the K2 antiserum using affinity purification, which was well-known in the art.

It is thus beyond dispute that the K2 antibody disclosed in the abstract is the claimed antibody and the claimed antibody could be isolated from the K1 through K3 sera by a technique that was well-known in the art.

Because the abstract inherently meets each and every element of the asserted claims, the asserted claims are anticipated and hence invalid. Id. at 1379.

Nichols tried arguing that the abstract did not anticipate because it was not until after the abstract was submitted that the inventors appreciated the significance of the claimed antibody, namely that it could be used to detect biologically active hPTH.

The CAFC didn’t buy that argument holding that:

Nichols’s argument that the abstract does not anticipate because the significance of the claimed antibody was not known until after the abstract was submitted is without merit. “[I]nherent anticipation does not require a person of ordinary skill in the art to recognize the inherent disclosure in the prior art at the time the prior art is created.” SmithKline, 403 F.3d at 1343 (citations omitted); see also Schering, 339 F.3d at 1377 (holding that “inherent anticipation does not require that a person of ordinary skill in the art at the time would have recognized the inherent disclosure”); MEHL/Biophile Int’l Corp. v. Milgraum, 192 F.3d 1362, 1366 (Fed. Cir. 1999) (“Where . . . the result is a necessary consequence of what was deliberately intended, it is of no import that the article’s authors did not appreciate the results.”).

Nichols also asserted that the abstract was not a printed publication under 35 U.S.C. § 102(b) because it was not adequately indexed but that was soundly rejected.

There is a lesson here for anyone rushing to publish their results. When faced with an abstract or paper that is to be published prior to filing a patent application, one might want to try to omit critical details from the manuscript in order to keep it from being enabling in a patent sense. But, this could be living dangerously. It’s always better to file an application first.