Federal Circuit Finds Prior Use By Another Invalidates Patent

In Teva Pharmaceutical Industries Ltd. v. AstraZeneca Pharmaceuticals LP, 100 U.S.P.Q.2d 1852 (Fed. Cir. 2011), Teva Pharmaceutical Industries Ltd. (“Teva”) appealed the District Court for the Eastern District of Pennsylvania’s grant of summary judgment in favor of AstraZeneca Pharmaceuticals LP (“AstraZeneca”).  The district court’s decision invalidated four asserted claims of Teva’s U.S. Patent No. RE39,502 (“‘502 patent”) based on AstraZeneca’s prior invention of the subject matter claimed therein.

Teva’s ‘502 patent is directed to formulations of statins, which are a class of compounds useful in the treatment of dyslipidemia, or high blood pressure.  Statins are inherently unstable and so must be manufactured in stabilized formulations; Teva’s patent is directed to formulations that are stabilized by an amido-group containing polymeric compound (“AGCP compound”).

In October 2008, Teva sued AstraZeneca for infringement of the ‘502 patent based on AstraZeneca’s manufacture and sale of its Crestor drug, which is also a stabilized statin formulation for the treatment of dyslipidemia.  AstraZeneca designed this drug with a non-AGCP compound as a stabilizer; however, the drug also contains crospovidone, an AGCP compound, which was included as a disintegrant as AstraZeneca did not understand it to have a stabilizing effect at the time.

AstraZeneca moved for summary judgment of invalidity under 35 U.S.C. § 102(g)(2), alleging that it conceived and reduced Crestor to practice prior to Teva’s first conception of the claimed subject matter.  AstraZeneca showed that it manufactured large batches of its formulation containing the same ingredients in the same amounts as its commercial drug prior to Teva’s date of conception and reduction to practice.  The district court held that AstraZeneca was not required to have “an appreciation of the stabilizing effect of crospovidone,” it only needed an “appreciation of the stabilization of its overall pharmaceutical composition that contained crospovidone.”  As such, the district court granted AstraZeneca’s motion and held the asserted claims invalid. Teva appealed to the Federal Circuit.

On appeal, the Federal Circuit held that the district court correctly concluded that AstraZeneca’s earlier development of Crestor satisfied the requirements for prior invention under 35 U.S.C. § 102(g)(2) and therefore affirmed.  The court determined that as a matter of law, AstraZeneca did not have to understand that crospovidone acted as a stabilizer in its drug prior to Teva’s conception.

35 U.S.C. § 102(g)(2) provides that:

A person shall be entitled to a patent unless … before such person’s invention thereof, the invention was made in this country by another inventor who had not abandoned, suppressed, or concealed it. In determining priority of invention under this subsection, there shall be considered not only the respective dates of conception and reduction to practice of the invention, but also the reasonable diligence of one who was first to conceive and last to reduce to practice, from a time prior to conception by the other.

The court discussed three previous cases,[1] explaining that they stand for the following: (1) “[t]o establish prior invention, the party asserting it must prove that it appreciated what it had made;” (2) “[t]he prior inventor does not need to know everything about how or why its invention worked;” and (3) “[n]or must [the prior inventor] conceive of its invention using the same words as the patentee would later use to claim it.”

The court noted that AstraZeneca had to appreciate that its drug was stable and what the components were, which AstraZeneca undisputedly did.  However, the court held that AstraZeneca did not have to appreciate which component of the drug was responsible for the stabilization, as that would require AstraZeneca to have first conceived of its drug in the same words that Teva chose to use to claim it.  The invention is not the language of the claim but the subject matter thereby defined.  AstraZeneca knew what it had made, even if it did not know precisely the cause of the stability.

Teva argued that the district court implicitly adopted a broadened claim construction, but the Federal Circuit disagreed.  The court noted that there was no instant dispute over the scope of the asserted claims because AstraZeneca made a limited concession of infringement for the purpose of advancing its summary judgment motion.  Thus, Teva essentially was arguing that AstraZeneca needed to understand its invention in the same terms used in Teva’s asserted claims, which as discussed above, is without merit.  For the same reason, the court declined to resolve how, if at all, the doctrine of inherency applies to priority under § 102(g), because this case did not involve a factual dispute over whether the prior art included a certain claim limitation (expressly or inherently).  Finally, the court held that AstraZeneca did not suppress or conceal its understanding that crospovidone was a stabilizer in its drug formulation, again because AstraZeneca was not required to appreciate the stabilizing effect of crospovidone.

Significance to Prior Users

While the American Invents Act in 35 U.S.C. § 273(a) allows the “new” defense when the infringing subject matter is “a process, or consisting of a machine, manufacture, or composition of matter used in a manufacturing or other commercial process” and where the defendant was “acting in good faith” and “commercially used” the subject matter in the United States, the defense itself has been in existence under existing law, albeit under different labels.  As pointed out in “Review of the Effects of the Leahy-Smith America Invents Act on Third Party Participation Applicants“, prior users could use portions of 35 U.S.C. §102(b) to i   The use must also be internal 35 U.S.C.  §102(g) as was done in Teva.  In contrast, under the 35 U.S.C. § 273(a) defense, a similar showing is required, but there will be an additional hurdle in that the use or commercial transfer, and have been ongoing for at least 1 year before the effective filing date or the disclosure date of new 35 U.S.C. § 102(b).   Therefore, while it likely inadvertent, it appears that the American Invents Act actually narrowed the prior user defense as compared to existing law.


[1] Invitrogen Corp. v. Clontech Labs., Inc., 429 F.3d 1052 (Fed. Cir. 2005); Mycogen Plant Sci. v. Monsanto Co., 243 F.3d 1316, 1332 (Fed. Cir. 2001); Dow Chemical Co. v. Astro-Valcour, Inc., 267 F.3d 1334 (Fed. Cir. 2001).

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