Bristol-Myers Squibb Co. v. Teva Pharms. United States, Inc.

• Decision Date: 12 June 2014
• Docket Number: No. 2013–1306.,2013–1306.
• Citation: 752 F.3d 967
• Parties: BRISTOL–MYERS SQUIBB COMPANY, Plaintiff–Appellant, v. TEVA PHARMACEUTICALS USA, INC., Defendant–Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

752 F.3d 967

BRISTOL–MYERS SQUIBB COMPANY, Plaintiff–Appellant,

v.TEVA PHARMACEUTICALS USA, INC., Defendant–Appellee.

No. 2013–1306.

United States Court of Appeals,Federal Circuit.

June 12, 2014.

William F. Lee, Wilmer Cutler Pickering Hale and Dorr LLP, of Boston, MA, argued for plaintiff-appellant. With him on the brief were Lauren B. Fletcher and Andrew J. Danford; Amy K. Wigmore and Thomas G. Saunders, of Washington, DC. Of counsel on the brief were Paul Berghoff, Alison J. Baldwin, and Joshua R. Rich, McDonnell Boehnen Hulbert & Berghoff LLP, of Chicago, IL.

George C. Lombardi, Winston & Strawn LLP, of Chicago, IL, argued for defendant-appellee. With him on the brief were Lynn MacDonald Ulrich, Ivan M. Poullaos, Julia Mano Johnson, and William P. Ferranti.

Before PROST,^* Chief Judge, PLAGER and CHEN, Circuit Judges.

CHEN, Circuit Judge.

This patent infringement case concerns a drug for the treatment of hepatitis B. After a four-day bench trial, the United States District Court for the District of Delaware found claim 8 of U.S. Patent No. 5,206,244 ('244 patent) invalid as obvious. We affirm the district court's invalidity judgment for the reasons that follow.

I.

Appellant Bristol–Myers Squibb Co. (BMS) owns the '244 patent. Claim 8 of the '244 patent is directed to a nucleoside analog composed of two regions: a carbocyclic ring and a guanine base. Nucleoside analogs are manmade compounds designed to mimic the activity of natural nucleosides, the building blocks of DNA and RNA. These compounds are modified slightly from their natural counterparts to interfere with the replication of viral DNA—which means that they can serve as possible antiviral compounds. Claim 8 covers one such compound, entecavir. BMS markets entecavir as a treatment for hepatitis B under the trade name Baraclude®.

Entecavir is a modified version of the natural nucleoside 2'-deoxyguanosine (deoxyguanosine). Entecavir is structurally identical to deoxyguanosine except for one difference: it has a carbon-carbon double bond (also known as an exocyclic methylene group) at the 5' position of the carbocyclic ring where deoxyguanosine has an oxygen atom.

The chemical structures of entecavir and deoxyguanosine are illustrated below:

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Appellant's Br. 8; see also J.A. 11.

The structures referenced throughout this opinion include a “carbocyclic ring” of carbon atoms, which is illustrated above as the pentagonal structure at the left of each diagram, and a nucleoside base, which is illustrated above as the double ring structure to the right. In both figures above, the nucleoside base is guanine.

Entecavir is an effective treatment for hepatitis B. The drug is generally accepted as a safe drug, with a broad therapeutic window for treatment, providing for a wide gap between low doses of the drug that are effective against disease and the high doses that could cause unwanted toxicity. It also has a high genetic barrier to resistance such that, if they have not previously received a nucleoside-based treatment, few patients treated with entecavir develop drug resistance to it.

The appellee, Teva Pharmaceuticals USA, Inc. (Teva), filed an abbreviated new drug application (ANDA) for a generic version of entecavir. In support of its ANDA, Teva filed “Paragraph IV” certifications, alleging that its generic products would not infringe the '244 patent, and/or that the patent was invalid or unenforceable. See21 U.S.C. § 355(j)(2)(A)(vii)(IV).

BMS sued Teva for patent infringement, claiming that Teva's ANDA filing infringed the '244 patent. See35 U.S.C. § 271(e)(2). At trial, the parties narrowed the issues to obviousness and inequitable conduct.¹ Teva's obviousness argument focused on the selection of 2'–CDG as a lead compound from the prior art.

A.

2'–CDG is a potent antiviral carbocyclic nucleoside analog that is structurally similar to the natural nucleoside deoxyguanosine, differing only in that it replaces an oxygen atom with a carbon atom at the 5' position. The following illustrations compare the chemical structures of 2'–CDG and deoxyguanosine.

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Appellant's Br. 14; see also J.A. 11, 23.

The earliest priority date for the '244 patent is the date that BMS filed the application, October 18, 1990. 2'–CDG's synthesis was first published in the Journal of Medicinal Chemistry in 1984 by Dr. Y. Fulmer Shealy (the Shealy reference) of the Southern Research Institute (the SRI). The Shealy reference taught that 2'–CDG exhibited better in vitro antiviral activity against the herpes virus than the FDA-approved best-selling drug at the time, Ara–A. Dr. Shealy obtained a patent for 2'–CDG and other related compounds, stating that they were useful in the treatment of viral infections. Subsequent research on 2'–CDG by Dr. Shealy showed in vivo activity against herpes viruses.

After the Shealy reference was published, other researchers soon began working with 2'–CDG as an antiviral, including scientists at SRI, Mount Sinai School of Medicine, GlaxoSmithKline (Glaxo), and other institutions. In 1989, Dr. J.A. Montgomery of SRI published an article summarizing the state of antiviral research at the time and reported that 2'–CDG was “[b]y far the most promising” antiviral against herpes. J.A. 2148. The Montgomery reference also taught that 2'–CDG was five to six times more potent than one of the leading drugs on the market, acyclovir. Teva's expert, Dr. Heathcock, stated that the Montgomery reference was a “lamp post that really illuminate[d] 2'–CDG as ... a very exciting lead compound to work from,” and other chemists, during the relevant time period, were using 2'–CDG as a lead compound. J.A. 27. BMS's expert, Dr. Schneller, conceded that he did not “completely disagree” with Dr. Heathcock's opinion. J.A. 27–28. In fact, Dr. Schneller himself published research investigating antiviral activity of carbocyclics, including 2'–CDG, and cited to Dr. Shealy's article, noting the significant antiviral activity of 2'–CDG.

Also in 1989, Peter M. Price and other researchers with the Mount Sinai School of Medicine published the results of testing 2'–CDG against hepatitis (the Price reference). The Price reference disclosed that 2'–CDG showed “excellent activity” against the hepatitis B virus “with as little as 25 ng of 2'–CDG per ml” resulting in the “almost complete disappearance of replicating” hepatitis B virus. J.A.2086. The Price reference also taught that 2'–CDG was “nontoxic in concentrations up to 200 times the minimum effective inhibitory concentration.” Id. According to Teva's expert, Dr. Heathcock, the Price reference demonstrated that 2'–CDG “had a very good therapeutic window [because] [i]t was effective at a level, much lower than its toxic level.” J.A. 1048.

While Shealy, Montgomery, Price, and others studied 2'–CDG, a group of medicinal chemists at Syntex published antiviral studies on another nucleoside analog composed of a carbocyclic ring and adenosine base. J.A.2001. The Madhavan reference disclosed that the substitution of an exocyclic methylene (carbon-to-carbon double bond) for the oxygen atom at the 5' positionon the carbocyclic ring on nucleoside aristeroinycin led to a nucleoside analog (Madhavan 30) with significantly superior antiviral properties. This exocyclic methylene substitution is the same modification at the same location made to 2'–CDG to form entecavir. The following illustrations compare the chemical structures of 2'–CDG, entecavir, and Madhavan 30.

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Appellant's Br. 8, 14, 15.

According to BMS's inventor, Dr. Zahler, he was aware of the Madhavan reference before conceiving entecavir and testified that BMS submitted it to the USPTO as the “most relevant” piece of prior art in the '244 patent application. J.A. 1078, 1215, 1223. But BMS did not submit 2'–CDG as prior art to the USPTO.

B.

After a bench trial, the district court found that at the time of BMS's invention, 2'–CDG was a lead compound for the development of antiviral drugs. Bristol–Myers Squibb Co. v. Teva Pharms. USA, Inc., 923 F.Supp.2d 602, 665 (D.Del.2013). Based on (1) the structural similarity between entecavir and 2'–CDG, (2) the teachings of the Madhavan reference, (3) the finding that the exocyclic methylene substitution would be a “small, conservative change [ ]” and (4) the “totality of the prior art” on 2'–CDG, the district court found that a skilled artisan would have been motivated to substitute an exocyclic methylene group at the 5' position of 2'–CDG, with a reasonable expectation of success of creating a compound with beneficial antiviral properties. Id. at 669, 675.

The district court also analyzed secondary considerations of nonobviousness. Although the court found that some of these considerations—commercial success, long-felt need, and evidence of unexpected properties—cut in favor of non-obviousness, the court ultimately concluded that Teva proved by clear and convincing evidence that claim 8 would have been obvious. Id. at 696. As a result, the district court entered judgment in favor of Teva. Id. BMS appeals the district court's invalidity finding. We have jurisdiction under 28 U.S.C. § 1295(a)(1).

II.

The only issue for our review is the district court's obviousness ruling. Obviousness is a question of law with underlying factual findings. Honeywell Int'l, Inc. v. United States, 609 F.3d 1292, 1297 (Fed.Cir.2010). We review the conclusion of obviousness de novo, and the trial court's factual findings for clear error. Id.

Obviousness requires assessing (1) the “level of ordinary skill in the pertinent art,” (2) the “scope and content of the prior art.” (3) the “differences between the prior art and the claims at issue,” and (4) “secondary considerations” of non-obviousness such as “commercial success, long-felt but unsolved needs, failure of others, etc.” KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398, 406, 127 S.Ct. 1727, 167 L.Ed.2d 705 (2007) (quoting Graham v. John Deere Co., 383 U.S. 1, 17–18, 86 S.Ct. 684, 15 L.Ed.2d 545 (1966))...