Imperial Chemical Industries, PLC v. Barr Laboratories

• Decision Date: 20 April 1992
• Docket Number: No. 87 Civ. 7833 (VLB).,87 Civ. 7833 (VLB).
• Citation: 795 F. Supp. 619
• Parties: IMPERIAL CHEMICAL INDUSTRIES, PLC, Plaintiff, v. BARR LABORATORIES, Defendant.
• Court: U.S. District Court — Southern District of New York

795 F. Supp. 619

IMPERIAL CHEMICAL INDUSTRIES, PLC, Plaintiff, v. BARR LABORATORIES, Defendant.

No. 87 Civ. 7833 (VLB).

United States District Court, S.D. New York.

April 20, 1992.

COPYRIGHT MATERIAL OMITTED

Lawrence A. Hymo, Cushman, Darby & Cushman, Washington, D.C., James F. Rittinger, Satterlee, Stephens, Burke & Burke, New York City, for plaintiff.

Myron Cohen, Cohen, Pontani & Lieberman, New York City, for defendant.

OPINION

VINCENT L. BRODERICK, Senior District Judge.

I

This case involves the issue of whether a patent on a pharmaceutical product can be sustained where information containing test results on a given species of animals contrary to the results intended to occur in humans, was deliberately withheld from the patent examiner, and was not reflected in the patent as issued. This opinion contains my findings of fact and conclusions of law, some of which are summarized or elaborated in the appendix. I find the existence of all the facts set forth by clear and convincing evidence. This court has jurisdiction of the matter pursuant to 28 U.S.C. 1331.

II

Under the Patent Clause of the Constitution implemented by the Patent Code enacted by Congress, the people of the United States offer an inventor protection against competition for a limited period in exchange for disclosure to the public of how to practice the patent and the best mode of using it. The granting of the patent monopoly is contingent upon the applicant disclosing to the Patent Examiner information needed to determine if the invention is novel, nonobvious and useful, without deliberately withholding material facts in a fraudulent manner. One of the main reasons for the Patent Code is to encourage inventors to make the necessary disclosures to permit others to advance the art; inventors may not keep secret information essential for that purpose. The plaintiff here failed to fulfill that obligation.

The patentee in this case failed to live up to its side of the bargain by making required disclosures. It therefore may not retain or enforce the protection against rivalry in making and selling a patented product which might otherwise be available.

The patent involved covers tamoxifen, which is widely used as a treatment for breast cancer and is under study as a possible preventive for it. Information important to the proper use and evaluation of this product was knowingly and improperly withheld from the Patent and Trademark Office ("PTO") and readers of the patent. To avoid misconstruction of these facts, they do not mean that the product as currently used is not safe and effective. It is the behavior of the plaintiff-patentee, the inadequacy of its disclosures some years ago and its deliberate withholding of known information which is the focus of my attention, leading to a finding that the patent is invalid and unenforceable.

Nothing contained in this opinion suggests, or is intended to suggest, that the drug "tamoxifen" is not safe or not effective. My focus has been on the comportment of the patent applicant, and not on issues of safety or effectiveness, which are issues appropriately dealt with by the Food and Drug Administration.

III

Plaintiff Imperial Chemical Industries, PLC ("ICI") obtained U.S. Patent 4,536,516 (meant when the term "the patent" is employed here unless some other modifier is used). The patent (Plaintiff's exhibit, "PEX" 200, identified at Tr. 1410 by an ICI witness), covering tamoxifen (sometimes referred to below as "the product") was issued on August 20, 1985 pursuant to application Serial Number ("SN") 600,224. Plaintiff asserts the benefit of an earlier initial submission date of August 26, 1963 based on SN 304,652.¹ Numerous intervening continuation applications were filed by ICI, leading to rejections and on March 15, 1984 to a decision of the United States District Court for the District of Columbia declining to order the PTO to grant one of the intermediate applications (S.N. 486,913). This ruling was reversed by the Court of Appeals for the Federal Circuit on February 15, 1985, and the patent in suit was issued.²

Thereafter defendant Barr Laboratories, Inc. ("Barr") challenged ICI's patent through an Abbreviated New Drug Application for a generic version of tamoxifen, constituting a technical infringement under 35 U.S.C. 271(e)(2), enacted by the Waxman-Hatch Drug Price Competition and Patent Restoration Act, Pub.Law No. 98-417, 98 Stat. 1585 (1984), leading to this suit; see generally Wheaton, "Generic Competition and Pharmaceutical Innovation: The Drug Price Competition and Patent Term Restoration Act of 1984," 35 Cath.U.L.Rev. 433 (1986).

IV

The effects of tamoxifen on human hormonal balance are crucial to its proper use. Without knowledge of such effects, unpredictable and at times disastrous consequences could well follow, rather obviously defeating the original purposes of administering the preparation.

Test results showing hormonal effects of tamoxifen in mice which were opposite to those in rats and opposite to those sought in humans, were known to ICI. Defense Exhibits ("DEX") 37, 41, 62. This information was deliberately withheld from a June 1966 affidavit of Arthur Leonard Walpole in S.N. 304,652 (DEX 1, the "Walpole Affidavit" sometimes also called the Walpole Declaration) submitted to the PTO. See Tr. 1450-60.

Reference to these test results and to differences in effects of the product in differing species, were also omitted from the patent specifications disclosed to the public under 35 U.S.C. 112 (PEX 200). Indeed, the patent referred to test results in rats (id., 2, col. 2) which were consistent with the function sought in humans, but deliberately omitted the contrary results observed in mice of which ICI was aware.

The Walpole Affidavit was signed on April 29, 1966. PEX 220, page 572, contains a handwritten note by Dr. Alan Laird, an ICI witness at the trial concerning a discussion with a Doctor Lanquist about information excluded from the Walpole Affidavit which states:

"... the results with mice, which are incomplete and unhelpful, should be omitted."

The following testimony ensued:

Q (by ICI counsel) ... Did you follow that instruction?

A Yes. Your Honor, I followed that instruction or indeed advice because I feel that was a statement that followed from the data provided.

According to PEX 201, p. 109, as of July 1966, "The arguments for patentability are based in toto on the Walpole Rule 132 affidavit." See direct examination of ICI witness Alan Laird, Tr. 1417; see also id. 1419.

DEX 32 shows that ICI engaged in further mouse research after the submission of the Walpole Affidavit, confirming that ICI recognized its importance.

ICI has contended that the mouse data, and the opposing effects of the product in different species, are irrelevant. Such negative information, however, is crucial to the proper use of the invention in its best mode. Such information would, moreover, have provided the patent examiner with background information essential to evaluation of tamoxifen. It would have played an essential role in facilitating determination by the patent examiner of the novelty, nonobviousness and usefulness of the invention under the Patent Code.

Patent claims "... are not born, and do not live, in isolation. Each is related to other claims, to the specification and drawings, to the prior art ... and often ... to earlier or later versions ..." Kingsdown Medical Consultants v. Hollister Inc., 863 F.2d 867, 874 (Fed.Cir.1988) (en banc).

Plaintiff's counsel argued that "... when you look at ... uses, not individually, but collectively ... as a group, and you look at the uses that were described in the prior art, and you look at the similarities of structure, when you put all of that together, it is enough that the uses and the application were consistent with the uses of the earlier compounds." Closing Arguments, January 4, 1991 at 49.

Yet such uses and structures can hardly be evaluated by a patent examiner, the PTO or a court without awareness of such negative information as inconsistencies in the hormonal impact of the compound on differing animals.

ICI counsel went on to point out that "... a person reading the application would see" a reference to a possible use, "knowing of the uses of the other compounds, see that they are related and also see the relationships in the structure, and would understand ... what was implied ... the uses that were known...." Id. at 50. But neither a patent examiner nor a user reading specifications could make this analysis if crucial data, surprising and potentially contradictory, were left out. Here, ICI itself knew further research was required, and in fact performed it. ICI counsel pointed out that you "get an idea, try it out and see if it works," Id. at 58. But neither the PTO nor a user would be sufficiently clued in as to what to try out and what to worry about without the withheld disclosures concerning mouse test results and their sharp divergence from rat testing results.

Counsel for ICI further emphasized quite appropriately that "... they couldn't predict with certainty what was going to happen until they made these compounds." Yet ICI picked and chose and in effect gerrymandered what portions of what happened it wished to reveal.

ICI counsel called attention to the fact that "... there is a degree of predictability in chemistry. But you can't predict absolutely," Id. at 59. But ICI knowingly withheld what it knew that would permit the PTO and users to predict as well as possible.

ICI counsel's insightful comments quoted above are in keeping with the more general reality recognized by the courts that the totality of crucial information forming a factual pattern is necessary to reach a proper conclusion. Circumstances pertinent to evaluation of any legal claim must be judged "without tightly compartmentalizing the various factual components and wiping the slate clean after scrutiny of each." Continental...