Bayer Ag. v. Biovail Corp.

• Decision Date: 07 February 2002
• Docket Number: No. 01-1329.,No. 01-1330.,01-1329.,01-1330.
• Citation: 279 F.3d 1340
• Parties: BAYER AG and Bayer Corporation, Plaintiffs-Appellants, v. BIOVAIL CORPORATION, Defendant-Appellee, and Elan Corporation, PLC and Elan Pharma, Ltd., and Teva Pharmaceuticals USA, Inc., Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1340

279 F.3d 1340

BAYER AG and Bayer Corporation, Plaintiffs-Appellants, v. BIOVAIL CORPORATION, Defendant-Appellee, and Elan Corporation, PLC and Elan Pharma, Ltd., and Teva Pharmaceuticals USA, Inc., Defendant-Appellee.

No. 01-1329.

No. 01-1330.

United States Court of Appeals, Federal Circuit.

February 7, 2002.

Rudolf E. Hutz, Connolly Bove Lodge & Hutz LLP, of Wilmington, DE, argued for plaintiffs-appellants. With him on the brief were Jeffrey B. Bove, Mary W. Bourke, and William E. McShane.

Gary N. Frischling, Irell & Manella LLP, of Los Angeles, CA, argued for defendants-appellees. With him on the brief for Elan Corporation, PLC, et al., were Richard M. Birnholz, Flavio Rose, Nicola J. Bird. Also on the brief for defendant-appellee Biovail Corporation was Eric C. Cohen, Welsh & Katz, of Chicago, IL; on the brief for defendant-appellee Teva Pharmaceuticals USA, Inc., was Frederick H. Rein, Goodwin Procter LLP, of New York, NY.

Before MICHEL, FRIEDMAN, and RADER, Circuit Judges.

RADER, Circuit Judge.

Bayer brought two separate actions in the United States District Court for the Northern District of Georgia asserting that Elan Pharmaceuticals Research Corp. (Elan) infringed U.S. Patent No. 5,264,446 (the '446 patent). The first action asserted that Elan infringed by filing an abbreviated new drug application (ANDA) with the Food and Drug Administration (FDA) seeking approval of a 60 mg generic version of the invention claimed in the '446 patent. The second action asserted infringement in Elan's marketing of a commercial 30 mg generic version. On summary judgment, the district court collaterally estopped Bayer from pursuing either action based on the court's previous finding of non-infringement in a related 30 mg ANDA infringement case. Because the district court erred in finding that it had necessarily and sufficiently construed the claims of the '446 patent in the 30 mg ANDA infringement case, this court vacates and remands both cases.

I.

In 1999, Bayer filed two lawsuits under 35 U.S.C. § 271(e)(2)(A) against Elan for infringement of the '446 patent. Bayer alleged that Elan infringed the '446 patent by filing ANDAs seeking FDA approval of the generic version of Bayer's 30 mg and 60 mg Adalat (R)(CC), a high blood pressure drug. Later that year, the district court resolved the 30 mg ANDA case in favor of Elan on a summary judgment of non-infringement. In 2000, this court affirmed that judgment. Bayer AG v. Elan Pharm. Research Corp., 212 F.3d 1241, 54 USPQ2d 1711 (Fed.Cir.2000). In 2000, Bayer also filed a third suit against Elan, Biovail Corp., and Teva Pharmaceuticals USA, Inc. (collectively Elan) under 35 U.S.C. § 271(a). In that case, Bayer argued that Elan's actual 30 mg generic commercial product infringed the '446 patent. The 60 mg ANDA case and the 30 mg commercial case are now on appeal before this court. The primary issue is whether collateral estoppel bars Bayer at the summary judgment phase in its two actions in light of the previous summary judgment of non-infringement in the 30 mg ANDA case.

The '446 patent claims a pharmaceutical composition, as well as a method for treating hypertension with that composition. The composition comprises crystals of nifedipine (a coronary vasodilator) with a specific surface area (SSA) of 1-4 m²/g. SSA is important to the invention. SSA is the total surface area of all individual crystals per unit weight. SSA is generally inversely proportional to particle size — the larger the particles, the smaller the SSA. [BB 6, n. 1] Bayer discovered that solid compositions comprising nifedipine drug crystals with a lower SSA unexpectedly demonstrated high solubility and good bio-availability. '446 patent, col. 3, ll. 47-58. Claims 1 and 4 claim this inventive feature. Claim 1 of the '446 patent reads (emphasis added):

A solid pharmaceutical composition comprising as the active ingredient an effective amount of nifedipine crystals with a specific surface area of 1.0 to 4 m²/g, in admixture with a solid diluent, to result in a sustained release of nifedipine.

Claim 4 reads (emphasis added):

In a method for treating hypertension by administering an effective amount therefor of nifedipine crystals to a patient, the improvement comprising employing nifedipine crystals having a specific surface area of 1.0 to 4 m²/g, in admixture with a solid diluent, to result in a sustained release of nifedipine.

The 30 mg ANDA case

On March 16, 1999, the district court granted Elan's motion for summary judgment that the 30 mg ANDA did not infringe the '446 patent. Bayer AG v. Elan Pharm. Research Corp., 64 F.Supp.2d 1295 (N.D.Ga.1999). On May 12, 2000, this court affirmed that judgment. Bayer AG v. Elan Pharm. Research Corp., 212 F.3d 1241, 54 USPQ2d 1711 (Fed.Cir.2000). This court observed that Elan amended its ANDA specification to cover nifedipine crystals with a SSA of at least 5 m²/g, measured no more than five business days before tablet manufacture. Id. at 1246. This court also noted: "Significantly, Bayer does not allege that within five working days, the nifedipine's SSA will decrease from 5 m²/g to a literally infringing size of 4 m²/g or less. Therefore, under the ANDA specification, Elan cannot literally infringe the '446 patent." Id. at 1249.

This court also faulted Bayer's reliance in its infringement analysis on a biobatch featured as test data in Elan's ANDA because ANDA applicants have immunity from allegations of infringement for testing necessary to prepare an ANDA. This court also noted that Elan's 30 mg ANDA specification defined its product to avoid infringement (i.e., testing nifedipine crystals outside the claimed SSA range), in contrast with the ANDA specification at issue in Glaxo, Inc. v. Novopharm, Ltd., 110 F.3d 1562, 42 USPQ2d 1257 (Fed.Cir.1997) (the ANDA specification did not test compounds specifically outside the claims). Id. at 1249, 1250. This court also held that prosecution history estoppel prevented Bayer from capturing a SSA above 4 m²/g because Bayer had amended its SSA range limitation from 0.5-6 m²/g to 1-4 m²/g during prosecution. Thus, Bayer could not assert infringement under the doctrine of equivalents. Id. at 1251, 1252. Accordingly, this court upheld the judgment that Elan's 30 mg ANDA did not infringe the '446 patent.

The 60 mg ANDA case

On September 24, 1999, Bayer filed the 60 mg ANDA case with the district court, one of the two cases now on appeal. Elan argued that this court's affirmance of non-infringement in the 30 mg ANDA case estopped Bayer from pursuing the 60 mg ANDA case. Elan argued that the relevant issue in the two actions was identical, namely, whether Elan would likely make a product that literally infringes the '446 patent upon approval of its ANDA.

Bayer responded that collateral estoppel did not apply. Specifically, Bayer asserted that the district court in the 30 mg ANDA case erroneously limited the '446 patent claims to measure only the SSA of starting raw material nifedipine, and not the SSA of nifedipine in the manufactured tablet. Bayer AG v. Elan Pharm. Research Corp., No. 2:99-CV-167-WCO, slip op. at 14-15 (N.D.Ga. Mar. 21, 2001) (60 mg ANDA Summary Judgment Order). To support this assertion, Bayer submitted new and previously unavailable evidence showing that Elan's commercial tablets made under the 30 mg ANDA likely would infringe the '446 patent. Id. at 6, 7. Bayer also requested full discovery of Elan's entire 60 mg ANDA specifications and related materials, arguing that its new evidence of infringement justified discovery to verify that "those specifications `define' a hypothetical product which cannot under any circumstances infringe," such as during manufacture. Bayer AG v. Elan Pharm. Research Corp., No. 2:99-CV-167-WCO, slip op. at 8-9 (N.D.Ga. Jan. 29, 2001) (60 mg ANDA Discovery Order).

The district court did not address claim construction in this new 60 mg ANDA case. Rather, finding Elan's ANDA specifications for the 60 mg product identical in relevant parts to those for the 30 mg product the district court determined: "[T]he issue of whether Elan will likely make a product that literally infringes Bayer's '446 patent under these circumstances was previously decided in the 30 mg ANDA case." 60 mg ANDA Summary Judgment Order, slip op. at 17. The district court also noted that collateral estoppel required an analysis of "whether Bayer can prove infringement of the '446 patent's '1.0 to 4 m²/g' surface area requirement when Elan's specifications require Elan to use nifedipine greater than 5 m²/g ... and when Elan's supplier AWD's [Arzneimittelwerk Dresden GmbH's] specifications require that it only sell nifedipine with a surface area more than 4.7 m²/g." 60 mg ANDA Discovery Order, slip op. at 11. This analysis, according to the district court, required examination of the decisions in the 30 mg ANDA case, the 60 mg ANDA SSA specifications, and AWD's SSA specifications, but not evidence of nifedipine SSA in the commercial tablet. Id. at 11-12. With these findings and conclusions, the district court dismissed Bayer's discovery request and granted Elan's motion for summary judgment of non-infringement based on collateral estoppel.

The 30 mg commercial case

On May 8, 2000, Bayer filed the 30 mg commercial case, the second of the two cases now on appeal. In this case, Bayer argued before the district court that it had obtained samples of the commercial 30 mg tablets Elan released on the market after final FDA approval of its 30 mg ANDA. As in the 60 mg ANDA case, Bayer submitted evidence that the SSA of those nifedipine tablets fell within the 1-4 m²/g range recited in the '446 patent. Bayer AG v. Biovail Corp., No. 2:00-CV-128-WCO, slip op. at 12 (N.D.Ga. Mar. 27, 2001) (30 mg Commercial Summary Judgment Order). In this case, however, unlike either the 30 mg or 60 mg ANDA cases, where allegations of infringement were based on ANDA specifications and "hypothetical" compositions...