Takeaway: That an alleged real party-in-interest (1) does not provide any payment of legal fees and expenses of a real party-in-interest, and (2) is without its own legal department, weighs against finding the alleged real-party-in-interest as a real party-in-interest that must be identified in a petition.

In its Decision, the Board granted institution of inter partes review (“IPR”) of claim 1-8 of the ’106 patent.

Patent Owner asserted that the Petition incorrectly identifies Amneal Pharmaceuticals, LLC, (“Amneal”) and Par Pharmaceutical, Inc. (“Par”), collectively the Petitioner, as the only real parties-in-interest (“RPI”). Patent Owner alleged that the Petition should have identified the parent companies of Par. According to Patent Owner, the Petition should be dismissed because it does not name all the RPI. In support of its argument, Patent Owner alleged that Par’s parent companies (1) exercise control over Par’s business, and (2) Par and its parent companies share the same corporate officers. Petitioner argued that it makes, sells, and distributes pharmaceuticals and filed an abbreviated new drug application (“ANDA”) whereas its parent companies do not conduct such operations.

The Board acknowledged, inter alia, that (1) Par is the sole operating company among the asserted RPI, (2) none of the asserted RPI have intervened in the proceeding, (3) Patent Owner has not filed suit alleging infringement against any of the asserted RPI, and (4) that the asserted parents act, in certain capacities, as a single unit. Regarding the last point, the Board determined that Par’s holding companies do not generate any revenues themselves, nor have legal departments of their own. Par is the only company paying relevant legal fees and expenses. The Board concluded, based on all the facts presented, that Par exerts control over the IPR and related litigation and, therefore, Petitioner has complied with the statutory requirement to identify all RPI.

Patent Owner argued that the Petition should be dismissed because it relies upon prior art and arguments that are the same or substantially the same as those considered in previous CBM petitions relating to the ’106 patent. The Board declined to do so because those decisions did not address the merits of any ground raised in the other IPR Petitions.

The ’106 patent is directed toward a method for controlling access to a sensitive prescription drug prone to potential abuse or diversion, by utilizing a central pharmacy and database to track all prescriptions for the sensitive drug. Petitioner challenged the ’106 patent as obvious over (1) Advisory Committee Art (“ACA”), including FDA Advisory Committee Transcript and Slides, Preclinical Safety Review, Briefing Booklet, and Xyrem Video and Transcript, and (2) Talk About Sleep (“TAS”) in view of Honigfeld, Elsayed, and Lilly. Petitioner also proffered the Declaration of Dr. Robert J. Valuck.

The Board construed “exclusive central computer system” to mean “single or sole computer system,” and “exclusive computer database” to mean “single or sole computer database.” The Board also construed the phrase “determining current and anticipated patterns of potential prescription abuse, misuse, or diversion of said prescription drug from periodic reports generated by the exclusive central computer system and the exclusive computer database” to mean “querying the exclusive computer database via the computer processor to generate periodic reports containing prescriber, patient, and/or prescription related information that permits evaluation of potential abuse, misuse, or diversion of a prescription drug.”

Patent Owner alleged the ACA, which was one of Exhibits 1003-1006, was not publicly accessible as prior art. The Board noted that a given reference is “publicly accessible” upon a satisfactory showing that such document has been disseminated or otherwise made available to the extent that persons interested and ordinarily skilled in the subject matter or art exercising reasonable diligence can locate it. Petitioner provided evidence corroborating the public accessibility of Exhibits 1003-1006. Petitioner also provided support from the Internet Archive: Wayback Machine showing the availability of slides prior and/or web pages prior to the ’106 patent’s priority date (December 17, 2002). Patent Owner argued that the archived web pages were first archived in 2011, not 2001. The Board concluded that the sum of the evidence indicated that the Petitioner’s asserted prior art was publicly accessible to one of ordinary skill before the priority date of the ’106 patent.

Turning to the obviousness challenge of the ’106 patent over the ACA, Petitioner asserted that one of ordinary skill would have had reason to combine the ACA documents. Petitioner relied upon the Declaration of Dr. Valuck in support of its assertion. Patent Owner asserted that Dr. Valuck’s opinion is unsupported and based on claim charts. The Board determined that while Dr. Valuck’s Declaration provides further explanation and claim charts in particular, the Petition provides sufficient analysis and citation to the asserted references. The Board was unpersuaded by Patent Owner’s other arguments regarding Petitioner’s obviousness challenge. The Board determined that Petitioner had shown a reasonable likelihood of prevailing with respect to at least one challenged claim based on the obviousness challenge over ACA.

Regarding the obviousness challenge based upon TAS, Petitioner alleged that all of the references relate to the same endeavor and the prior art elements could have been combined using known methods to yield predictable results. The Board noted an essential difference between TAS and Honigfeld or Elsayed is the use by Honigfeld, Elsayed, and Lilly of (i) a centralized registration database, and (ii) de-centralized systems that permit multiple registered pharmacies to dispense the prescription drug directly to patients. Thus, contrary to Petitioner’s argument, the Board determined that Honigfeld does not teach a single integrated computer database that is utilized to manage the receipt of prescription requests. The Board also determined that there is insufficient evidence to suggest that Honigfeld’s database, Elsayed’s computer readable storage medium, or Lilly’s tracking system is “controlling the distribution of said prescription drug” or “authorizing the filling…of a prescription for the prescription drug” using an “exclusive central computer system,” i.e., a single pharmacy, as recited in claim 1 of the ’106 patent. The Board concludes that TAS generally describes a different system using a central pharmacy to receive, process, and dispense prescriptions. Thus, the Board determined that Petitioner had not shown a reasonable likelihood of prevailing in showing that the challenged claims are obvious over TAS.

PAR PHARMACEUTICAL, INC. and AMNEAL PHARMACEUTICALS, LLC v. JAZZ PHARMACEUTICALS, INC., IPR2015-00546
Paper 25: Decision Instituting Inter Partes Review
Dated: July 28, 2015
Patent: 7,765,106
Before: Jacqueline Wright Bonilla, Susan C. Mitchell, and Brian P. Murphy
Written by: Bonilla
Related proceedings: Jazz Pharms, Inc. v. Par Pharm., Inv., 2:13-cv-07884 (D.N.J. Dec. 27, 2013); Jazz Pharms, Inc. v. Amneal Pharms., LLC, 2:13-cv-00391 (consolidated) (D.N.J. Jan. 18, 2013); Jazz Pharms, INc. v. Roxane Labs., Ltd.,2:14-cv-4467 (D.N.J. July 15, 2014); Jazz Pharms., Inc. v. Watson Labs., Inc., 2:14-cv-7757 (D.N.J.); IPR2015-00545 (Patent 8,589,182); IPR2015-00547 (Patent 7,765,107); IPR2015-00548 (Patent 7,895,059); IPR2015-00551 (Patent 8,457,988); and IPR2015-00554 (Patent 7,668,730); CBM2014-00149 (Patent 7,895,059); CBM2014-00150 (Patent 8,457,988); CBM2014-00151 (Patent 7,668,730); CBM2014-00153 (Patent 8,589,182); CBM2014-00161(the ’106 patent); and CBM2014-00175 (Patent 7,765,107)