Eli Lilly v. Zenith Goldline

• Decision Date: 26 December 2006
• Docket Number: No. 05-1429.,No. 05-1396.,No. 05-1430.,05-1396.,05-1429.,05-1430.
• Parties: ELI LILLY AND COMPANY and Lilly Industries Limited, Plaintiffs-Appellees, v. ZENITH GOLDLINE PHARMACEUTICALS, INC. (now known as Ivax Pharmaceuticals, Inc.), Defendant-Appellant, and Teva Pharmaceuticals USA, Inc., Defendant-Appellant, and Dr. Reddy's Laboratories, Ltd., Defendant-Appellant.
• Court: U.S. Court of Appeals — Federal Circuit

471 F.3d 1369

ELI LILLY AND COMPANY and Lilly Industries Limited, Plaintiffs-Appellees, v. ZENITH GOLDLINE PHARMACEUTICALS, INC. (now known as Ivax Pharmaceuticals, Inc.), Defendant-Appellant, and Teva Pharmaceuticals USA, Inc., Defendant-Appellant, and Dr. Reddy's Laboratories, Ltd., Defendant-Appellant.

No. 05-1396.

No. 05-1429.

No. 05-1430.

United States Court of Appeals, Federal Circuit.

December 26, 2006.

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Charles E. Lipsey, Finnegan, Henderson, Farabow, Garrett & Dunner, L.L.P., of Reston, VA, argued for plaintiffs-appellees. With him on the brief were L. Scott Burwell; David S. Forman and Laura P. Masurovsky, of Washington, DC; Robert F. McCauley, of Palo Alto, CA; and Jan M. Carroll, Barnes & Thornburg, LLP, of Indianapolis, IN. Of counsel on the brief were James P. Leeds, David M. Stemerick, and Robert D. Titus, Eli Lilly and Company, of Indianapolis, IN.

William L. Mentlik, Lerner, David, Littenberg, Krumholz & Mentlik, LLP, of Westfield, NJ, argued for defendant-appellant, Zenith Goldline Pharmaceuticals, Inc. (now known as Ivax Pharmaceuticals, Inc.). With him on the brief were Roy H. Wepner and Michael H. Teschner. Of counsel on the brief were Jeffrey S. Ward and Thomas P. Heneghan, Michael Best & Friedrich LLP, of Madison, WI. Joining in the brief were Steven J. Lee, Elizabeth Holland, and Patrice P. Jean, Kenyon &amp Kenyon, of New York, NY, for defendant-appellant, Teva Pharmaceuticals USA, Inc.

Stuart D. Sender, Budd Larner, P.C., of Short Hills, NJ, argued for defendant-appellant, Dr. Reddy's Laboratories, Ltd. With him on the brief were Ellen T. Lowenthal and Michael H. Imbacuan.

Before RADER, SCHALL, and GAJARSA, Circuit Judges.

RADER, Circuit Judge.

Zenith Goldline Pharmaceuticals, Inc. (now known as IVAX Pharmaceuticals, Inc.) (IVAX); Dr. Reddy's Laboratories, Ltd. (DRL); and Teva Pharmaceuticals USA, Inc. (Teva) (defendants), filed an Abbreviated New Drug Application (ANDA). In response, the plaintiffs, Eli Lilly and Company and Lilly Industries Ltd. (collectively Lilly), filed suit against all defendants for infringement of United States Patent No. 5,229,382 ('382 patent). Following a two and one-half week bench trial, the United States District Court for the Southern District of Indiana found the '382 patent valid and infringed. Eli Lilly & Co. v. Zenith Goldline Pharm., 364 F.Supp.2d 820 (S.D.Ind.2005) (Final Judgment); Eli Lilly & Co. v. Zenith Goldline Pharm., 1:01-cv-443-RLY-VSS (S.D.Ind. May 9, 2005) (Amended Final Judgment). In 221 pages of written analysis, the trial court documented its findings and conclusions. Eli Lilly & Co. v. Zenith Goldline Pharm., 364 F.Supp.2d 820 (S.D.Ind.2005) (Findings of Fact and Conclusions of Law). The defendants appeal the trial court's conclusions on the validity of the '382 patent and inequitable conduct. Finding no reversible error, this court affirms.

I.

The '382 patent claims both olanzapine and use of the compound to treat schizophrenia. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 830. A Lilly research chemist first synthesized olanzapine in the United Kingdom in 1982. Id. at 834. Lilly filed the '382 patent application on May 22, 1992. The patent issued on July 20, 1993. The United States Food and Drug Administration (FDA) approved olanzapine, sold by Lilly under the trademark Zyprexa®, in late 1996. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 830. By filing an ANDA, the defendants stipulate to infringement if the '382 patent is valid and enforceable. Amended Final Judgment, slip op. at 1.

Claims 1, 2, 3, 7, 8, and 15 of the '382 patent set forth the boundaries of the invention:

1. 2-Methyl-10-(4-methyl-1-piperazinyl)-4H-thieno[2,3-b][1,5]benzodiazepine, or an acid addition salt thereof.

2. A pharmaceutical composition comprising a compound according to claim 1 or a pharmaceutically acceptable acid addition salt thereof together with a pharmaceutically acceptable diluent or carrier therefor.

3. A pharmaceutical composition in capsule or tablet form comprising from 2.5 to 5 mg of the compound of claim 1 together with a pharmaceutically acceptable diluent or carrier therefor.

* * * *

7. A method of claim 5 for treating an animal, including a human, suffering from or susceptible to schizophrenia.

8. A method of claim 7 wherein the effective amount is from 0.1 to 20 mg per day of 2-methyl-10-(4-methyl-1-piperazinyl)-4H-thieno[2,3-b][1,5]benzodiazepine, or a pharmaceutically acceptable acid addition solution salt thereof.

* * * * 15. A pharmaceutical composition in capsule or tablet form comprising from 0.1 to 20 mg of the compound of claim 1 together with a pharmaceutically acceptable diluent or carrier therefor.

'382 patent, col. 12, ll. 10-20, ll. 33-40, ll. 64-67.

Before discovery of olanzapine, Lilly discovered other drugs in the same family of compounds (thienobenzodiazepines), namely clozapine, flumezapine, ethyl flumezapine and ethyl olanzapine (a.k.a. Compound '222). Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 831-33. These compounds share a common structural nucleus as thienobenzodiazepines, namely a piperazine ring (R), a benzene ring (R1), and a thiophene ring (R2).

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Lilly used clozapine to treat some forms of schizophrenia in the late '60s and early '70s. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 831. Clozapine was thus the first "atypical" antipsychotic drug. Structurally, olanzapine differs from clozapine in that olanzapine has a methyl-substituted thiophene ring in place of the benzene ring in clozapine. Id. at 846-47. Olanzapine also has hydrogen in place of the chlorine on its benzene ring. Id. at 847.

Despite its advantages, researchers discovered in 1975 that clozapine caused an often fatal blood disorder (agranulocytosis) in one percent of patients. For that reason, Lilly withdrew clozapine from the market. Id. Nevertheless, after a general failure to replace clozapine, reflected by many documented reports of promising compounds that failed either for lack of efficacy or toxic side-effects, the FDA, in late 1989, approved clozapine with careful blood-monitoring. Id. at 832.

Until discovery of olanzapine, researchers attributed the efficacy of clozapine and typical antipsychotics to their "neuroleptic substituent"—an electron-withdrawing group considered important to the antipsychotic activity of the compounds. Id. Halogen—a fluorine (F) or chlorine (Cl) atom—is such an electron withdrawing group. Id. at 832, 850.

Olanzapine does not have a halogen atom, i.e. a fluorine (F) or chlorine (Cl) atom. Instead, it has a hydrogen atom (H), which is not an electron withdrawing (or electronegative) group. Id. at 850.

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The prior art to olanzapine includes ethyl flumezapine and flumezapine, both disclosed in U.S. Patent No. 4,115,574 ('574 patent) that issued in 1978. The prior art also includes ethyl olanzapine (a.k.a. Compound '222). Ethyl flumezapine caused widespread blood problems in dogs. Id. at 847. Flumezapine caused extra-pyramidal symptoms (EPS) and an increase in liver enzymes and a muscle enzyme called creatine phosphokinase (CPK). Ethyl olanzapine caused a significant increase in cholesterol in female beagle dogs. Id. Thus, the prior art to olanzapine had significant detrimental side effects.

Olanzapine differs structurally from flumezapine, by substitution of a hydrogen atom (H) for the fluorine atom (F) in flumezapine at the 7-position of the benzene ring. Id.

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Olanzapine differs structurally from ethyl flumezapine by replacement of the fluorine atom (F) and ethyl group (CH2CH3) in ethyl flumezapine with a hydrogen atom (H) and methyl group (CH3) respectively. Id.

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Olanzapine differs structurally from its ethyl analog, Compound '222 (ethyl olanzapine), by replacement of the ethyl group (CH2CH3) with a methyl group (CH3) at the 2-position of the thiophene ring. Id.

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I

The trial court found that the defendants did not prove by clear and convincing evidence that claims 1, 2, 3, 7, 8, and 15 of the '382 patent were invalid as anticipated under 35 U.S.C. § 102. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 922-23. The primary reference the defendants cited for anticipation of these claims is an article entitled "4-Piperazinyl-10H-thieno [2,3-b][1,5]benzodiazepines as Potential Neuroleptics" from the Journal of Medicinal Chemistry in 1980 (Chakrabarti 1980a). Jiban K. Chakrabarti, Linda Horsman, et al., 4-Piperazinyl-10H-thieno[2,3-b][1,5]benzodiazepines as Potential Neuroleptics, 23 J. Med. Chem. 8 (1980).

Anticipation is a question of fact, including whether or not an element is inherent in the prior art. See In re Schreiber, 128 F.3d 1473, 1477 (Fed.Cir. 1997). Therefore, this court reviews a finding of anticipation under the clearly erroneous standard. Atlas Powder Co. v. Ireco, Inc., 190 F.3d 1342, 1346 (Fed.Cir. 1999). To anticipate, a prior art reference must place the inventive compound or composition in the possession of the public. In re Brown, 51 C.C.P.A. 1254, 329 F.2d 1006, 1011 (1964). Thus, the prior art reference must disclose each and every feature of the claimed invention, either explicitly or inherently. Glaxo Inc. v. Novopharm Ltd., 52 F.3d 1043, 1047 (Fed.Cir. 1995).

Pointing to In re Petering, 49 C.C.P.A. 993, 301 F.2d 676 (1962) and In re Schaumann, 572 F.2d 312 (C.C.P.A.1987), IVAX asserts that Chakrabarti 1980a anticipated claim 1 of the '382 patent because it identified compounds from the same family of compounds (thienobenzodiazepines). Indeed, in Petering, the Board of Patent Appeals affirmed the examiner's rejection of...