The U.S. Court of Appeals for the Federal Circuit, in addressing the standard for establishing when a chemical compound is obvious based on prior art compounds, reiterated its two-part framework earlier established in Takeda Chemical Industries, Ltd. v. Alphapharm Pty., Ltd. (see IP Update, Vol. 10, No. 7). Otsuka Pharmaceutical Co., Ltd. v. Sandoz Inc. et al., Case Nos. 11-1126; -1127 (Fed. Cir., May 7, 2012) (Lourie, J.)

The chemical compound at issue, aripiprazole, is a carbostyril compound used as an antipsychotic and marketed under the trade name ABILIFY®. The defendants argued that aripiprazole was obvious based on any one of three proposed lead compounds—an “unsubstituted butoxy” carbostyril, a “2,3-dichloropropoxy” carbostyril, and a “2,3-dimethylpropoxy” carbostyril. After a bench trial, the district court found that the asserted prior art would not have led one of ordinary skill to select any of the three compounds as a lead compound for further antipsychotic research. Sandoz appealed.

On appeal, the Sandoz argued that the district court’s lead compound analysis was the sort of “rigid analysis” that had been precluded by the Supreme Court’s decision in KSR v. Teleflex (see IP Update, Vol. 9, No. 10). Noting that proof of structural obviousness under Takeda requires a demonstration that one of ordinary skill in the art would have selected the proposed lead compound for further development and that the prior art would have supplied one of ordinary skill with reason to modify the lead compound into the claimed compound with a reasonable chance of success, the panel found that KSR did not compel alteration of the test.

The Court then turned to the three compounds offered by the defendants as lead compounds. For the “unsubstituted butoxy” compound, the Court found that the prior art would have suggested a different, structurally dissimilar compound, to use as a starting point. For the “2,3-dichloropropoxy” compound, the Court agreed with the district court that the defendants’ argument used impermissible hindsight analysis. Finally, for the “2,3-dimethylpropoxy” compound, the Court found that while the evidence did suggest that it could be used as a potential lead compound, there was insufficient evidence to suggest one of ordinary skill in the art would have modified it in such a manner as to make aripiprazole.