Glaxo, Inc. v. Novopharm Ltd., 91-759-CIV-5-BO.

Decision Date17 September 1993
Docket NumberNo. 91-759-CIV-5-BO.,91-759-CIV-5-BO.
Citation830 F. Supp. 871
CourtU.S. District Court — Eastern District of North Carolina
PartiesGLAXO, INC. and Glaxo Group Limited, Plaintiffs, v. NOVOPHARM LTD., Defendant.

Stephen B. Judlowe, William G. Todd, Janet B. Linn, Hopgood, Calimafde, Kalil, Blastein & Judlowe, New York City, Steven P. Lockman, Stuart J. Land, Arnold & Porter, Washington, DC, Joseph W. Eason, Moore & Van Allen, Raleigh, NC, for plaintiffs.

John E. Rosenquist, Robert F. Green, Jeffrey S. Ward, Leydig, Voit & Mayer, Chicago, IL, John R. Wallace, Kirby, Wallace, Creech, Sarda & Zaytoun, Raleigh, NC, for defendant.

ORDER

TERRENCE WILLIAM BOYLE, District Judge.

Plaintiff Glaxo Group Ltd. is the owner of United States Patent No. 4,521,431 covering a particular crystalline form of a chemical compound called ranitidine hydrochloride.1 The '431 patent expires in 2002. Plaintiff Glaxo Inc. is the United States subsidiary of Glaxo Group Ltd. and is the exclusive U.S. licensee of the '431 patent. Defendant Novopharm infringed this patent on August 9, 1991, by filing an Abbreviated New Drug Application (ANDA) with the Food and Drug Administration in which it sought to market ranitidine hydrochloride beginning in 1995. Plaintiffs (hereinafter referred to collectively as Glaxo) then filed this action requesting an injunction barring further infringement by Novopharm. Novopharm filed an answer in which it admitted infringement, but raised as a defense that the patent was invalid.

The case was tried to the court starting on August 9, 1993. At trial, Novopharm contended that the '431 patent is invalid for three reasons: (1) because the crystalline form claimed in the '431 patent was inherently anticipated by an earlier patent held by Glaxo, (2) because Glaxo engaged in inequitable conduct in the prosecution of the '431 patent, and (3) because Glaxo officials prosecuting the '431 patent failed to disclose the best mode of processing ranitidine chloride for pharmaceutical use. Evidence was presented on each of these issues, and based upon that evidence the court decides the issues.

I. FACTUAL BACKGROUND
A. The '658 Patent.

In 1976 Glaxo chemists in Great Britain discovered ranitidine, an aminoalkyl furan derivative with histamine blocking capabilities, and began preparations for manufacturing and selling ranitidine as an antiulcer drug. An application for a patent covering the compound was filed with the patent office in the United Kingdom in 1976.

During the patent application process, Glaxo chemists attempted to synthesize a ranitidine salt. Salts are generally the preferred form of a compound for use in pharmaceutical manufacturing. On June 27, 1977, David Collin, a chemist at Glaxo's laboratories in Ware, U.K., discovered a process for making ranitidine hydrochloride, a salt of ranitidine, and recorded the method he had discovered in his notebook.

On July 25, 1977, Glaxo filed an application for a U.S. Patent covering all ranitidine compounds of a specified general formula, including ranitidine hydrochloride. That application resulted in the issue of United States Patent No. 4,128,658 (the '658 patent).

Claim 18 of the '658 patent covers ranitidine hydrochloride. The method for making ranitidine hydrochloride is set out at Example 32 of that patent. Example 32 was written based on Mr. Collin's work of June 27, 1977.

B. The '431 Patent.

From 1977 to 1980, Glaxo's Chemical Development Department tested procedures for the commercial production of ranitidine hydrochloride. The procedure set out in Example 32 was not used in any of this work. A somewhat similar process, known within Glaxo as Process 3A, was used during the early part of the scale-up work, and in 1979, a more efficient procedure known as Process 3B was substituted for Process 3A.

On April 15, 1980, for unknown reasons, the thirteenth batch of ranitidine hydrochloride prepared using Process 3B produced crystals that were different from those previously produced by Glaxo. The differences between the prior batches and Batch 3B13 were confirmed by two analytic processes, known as infra-red spectroscopy and x-ray powder diffraction. Based on these analyses Glaxo chemists concluded that there were two crystal forms of ranitidine hydrochloride. Glaxo chemists designated the form produced on April 15 as Form 2 and the form produced in all prior batches as Form 1.

Glaxo eventually decided to proceed with the commercial development of Form 2 rather than Form 1, and modified Process 3B so that it regularly produced Form 2. The modified Process 3B was designated Process 3C by Glaxo chemists, and has been used by Glaxo to manufacture all the ranitidine hydrochloride it has sold commercially.

On October 1, 1980, Glaxo filed a U.K. patent application covering Form 2. This application was prosecuted for Glaxo by Elkington and Fife, a firm of patent agents in the United Kingdom. In 1981, Glaxo filed a U.S. patent application covering Form 2, naming as the inventor Dr. Derek Crookes, the chemist who was in charge of the Chemical Development Department in 1980 when the first Form 2 was produced.

The patent examiner initially rejected the claims of Glaxo's Form 2 application and again rejected them on reconsideration. Grounds for the rejection were stated as "anticipated by or, in the alternative, ... obvious over" the '658 patent, referring specifically to Example 32.

In response to this rejection, Glaxo submitted two declarations which purported to show distinctions between the claims in the application and the prior art. After receiving these declarations, the examiner withdrew his rejections, and U.S. Patent No. 4,521,431 was issued, covering Form 2 ranitidine hydrochloride as characterized by its infra-red spectrum (Claim 1) and its x-ray powder diffraction pattern (Claim 2). In addition, the patent covers certain pharmaceutical compositions (Claims 3-16) and treatment methods (Claims 17 and 18) using Form 2.

II. NOVOPHARM'S DEFENSES

As noted above, Novopharm admits that by filing its ANDA in 1991 it infringed on the '431 patent, but raises in defense its contentions that the patent is invalid. There is a statutory presumption that an issued patent is valid, 35 U.S.C. § 282, and the party challenging the patent bears the burden of proving invalidity by clear and convincing evidence. Ethicon, Inc. v. Quigg, 849 F.2d 1422 (Fed.Cir.1988). Keeping these standards in mind, the court now turns to a discussion of Novopharm's challenge to the validity of the '431 patent.

A. Inherent Anticipation.

Under 35 U.S.C. § 102, an invention may be patented only if it is "novel." Novelty is judged by examining the "prior art" available to the public at the time the patent application is filed. The prior art includes the teaching from an existing patent such as the '658 patent in this instance. Graham v. John Deere Co., 383 U.S. 1, 6, 86 S.Ct. 684, 688, 15 L.Ed.2d 545 (1966). If a unit of prior art discloses an invention, then the invention is said to be "anticipated" by the prior art. RCA Corp. v. Applied Digital Data Systems, Inc., 730 F.2d 1440, 1444 (Fed.Cir.1984). The prior art need not expressly disclose the invention.

If an inventor seeks to claim an advantage or modification that flows necessarily from a prior art reference, the reference inherently anticipates the inventor's claim, Stoller v. Ford Motor Co., 18 U.S.P.Q.2d 1545, 1547, 1991 WL 5889 (Fed.Cir.1991), even if the advantage was not appreciated by the inventor of the prior art. In re Sovish, 769 F.2d 738 (Fed.Cir.1985).

In order for a claim to be inherent in the prior art it is not sufficient that a person following the disclosure sometimes obtain the result set forth in the claim, it must invariably happen. Standard Oil v. Montedison, 664 F.2d 356, 372 (3rd Cir.1981).

Novopharm contends that Form 2 ranitidine hydrochloride, claimed in the '431 patent, is inherent in Example 32 of the '658 patent. As noted, Example 32 describes a process for making ranitidine hydrochloride, and was written based on David Collin's experiment of June 27, 1977, recorded in his notebook at page 122.2

In layperson's terms, the example tells a chemist to dissolve ranitidine base in industrial methylated spirit (IMS) (a solvent made up largely of ethanol) containing hydrogen chloride gas, then to add ethyl acetate, which is a cosolvent to aid in crystallization. As a result, crystals of ranitidine hydrochloride will form and precipitate from the solution. The crystals are then filtered out and dried.

It is Novopharm's theory that when the Example 32 procedure is faithfully followed, the product is, and always was, Form 2 ranitidine hydrochloride. Novopharm does not dispute that Mr. Collin performed the work shown in his notebook on page 122, or that his work produced Form 1.

Instead, Novopharm claims that Example 32 as written omits two critical and material steps that Mr. Collin included in his experiment on page 122. Consequently, Novopharm claims that when the prior art, Example 32, is practiced exactly as written, without the critical extra steps taken by Collin during his experiment of June 27, 1977, the product is always Form 2.

Simply put, Novopharm claims Glaxo never performed Example 32 precisely as written either before or after including it in the '638 patent. Novopharm theorizes if Glaxo had properly performed the example, the result would have been Form 2.

Novopharm claims that in reality it was the first party to faithfully practice Example 32. Novopharm contends the results of such practice under the prior art led Novopharm to the conclusion that Form 2 was anticipated by the '658 patent and, consequently, this conclusion led Novopharm to the filing of its ANDA application in 1991.

In support of this contention, Novopharm called as witnesses four chemists.3 Novopharm contends the chemists repeatedly followed the Example 32 procedure and always achieved Form 2. These results were tested by...

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