BAYER PHARMA AG, v. WATSON LABS, INC.: Nov. 1, 2017. Before Lourie, Moore, and O’Malley

Takeaway:

• The CAFC will reverse a finding of non-obviousness where key references are missing from a district court’s opinion and mere concerns over effectiveness do not rise to the level of teaching away.

Procedural Posture: Alleged infringer appealed the District Court for the District of Delaware’s final judgment holding that the alleged infringer failed to prove by clear and convincing evidence that the claims of the asserted patent would have been obvious. The CAFC reversed, holding that the District Court clearly erred in finding a skilled artisan would not have been motivated to use the claim elements, and further holding that the claims would have been obvious.

Synopsis:

• Obviousness – Vardenafil ODT Limitation: The ’950 patent is directed to a formulation of vardenafil, a drug commonly used to treat erectile dysfunction (ED), “in the form of an uncoated tablet which disintegrates rapidly in the mouth,” commonly referred to as an oral disintegrating tablet (ODT). Bayer markets a commercial embodiment of the ’950 patent, vardenafil ODT, under the name Staxyn.  Watson filed an Abbreviated New Drug Application (ANDA) with the FDA seeking approval to market a generic version of Staxyn and Bayer sued, citing the ’950 patent.  Watson argued the claimed formulation of vardenafil would have been obvious to a person of ordinary skill in the art based on multiple exemplary references showing a motivation to: 1) create an ODT formulation of vardenafil; (2) select mannitol and sorbitol as sugar alcohols; and (3) make the ODT formulation immediate-release. The District Court disagreed, finding that prior art taught away from formulating vardenafil ODT as immediate-release. The District Court determined that Watson failed to meet its burden of proving by clear and convincing evidence that there would have been a motivation to formulate vardenafil as an ODT formulation.  The District Court found it important that, according to Bayer’s expert, no ED ODT drug was on the market as of the ’950 patent’s priority date. The CAFC found that the clear error in the District Court fact finding that there was no motivation to formulate ED drugs in ODTs, is that it concluded that the record did not contain an indication that ED drugs would be good candidates for ODT formulations.  However, the CAFC found that six key references were missing from the District Court’s analysis of whether the prior art taught vardenafil ODT or whether a skilled artisan would have been motivated to formulate vardenafil ODT. In light of these references, the CAFC found that the District Court clearly erred in determining that one of skill would not have been motivated to make ODT formulations of ED drugs.  The District Court’s findings underlying the motivation to formulate vardenafil ODT focused on the commercial availability of ODT formulations of ED drugs as of the ’950 patent’s priority date.  The CAFC disagreed with this approach, stating that [t]he motivation to combine inquiry is not limited to what products are forthcoming or currently available on the market.” The CAFC concluded that District Court clearly erred when it found there would not have been a motivation to formulate vardenafil ODT.

• Obviousness – Sorbitol and Mannitol Limitation: Neither party disputed that it was known to include a sugar alcohol in ODT formulations. The parties’ dispute rested on whether a person of ordinary skill in the art would have been motivated to select the claimed combination of sugar alcohols, sorbitol and mannitol. The District Court found a person of ordinary skill in the art would not have been motivated to use mannitol and sorbitol in an ODT formulation. The CAFC, however, found the District Court’s analysis for the sorbitol and mannitol limitation again focused on the commercial availability of products while failing to address relevant prior art.  The CAFC concluded that the District Court clearly erred, and that Watson’s evidence expressly demonstrated that sorbitol and mannitol in ODTs was known in the art and that there were advantageous reasons to use them.

• Obviousness – Immediate-Release Limitation: The District Court found that even if a skilled artisan would have been motivated to make an ODT formulation of vardenafil, the prior art taught away from formulating vardenafil ODT as immediate release since a person of ordinary skill in the art would have expected vardenafil ODT to have a bitter taste, which would have discouraged her from creating an immediate-release formulation. It also found a person of ordinary skill in the art would have been concerned with using an immediate-release formulation because it would be expected to increase bioavailability, and Levitra’s label suggested an increase in vardenafil blood levels would be a problem for older men. The CAFC disagreed, finding that the evidence before the District Court supports its finding that a person of ordinary skill in the art may have preferred a delayed-release formulation over immediate release—not that an immediate-release formulation was unlikely to be productive in vardenafil ODT, and the concerns did not rise to the level of teaching away. Weighing this evidence, the CAFC concluded that the patent would have been obvious and reversed the District Court’s holding.