Teva Pharm. Indus. Ltd. v. AstraZeneca Pharms. LP

• Decision Date: 01 December 2011
• Docket Number: No. 2011–1091.,2011–1091.
• Citation: 661 F.3d 1378,100 U.S.P.Q.2d 1852
• Parties: TEVA PHARMACEUTICAL INDUSTRIES LTD., Plaintiff–Appellant, v. ASTRAZENECA PHARMACEUTICALS LP and IPR Pharmaceuticals Inc., Defendants–Appellees.
• Court: U.S. Court of Appeals — Federal Circuit

100 U.S.P.Q.2d 1852

661 F.3d 1378

TEVA PHARMACEUTICAL INDUSTRIES LTD., Plaintiff–Appellant,

v.ASTRAZENECA PHARMACEUTICALS LP and IPR Pharmaceuticals Inc., Defendants–Appellees.

No. 2011–1091.

United States Court of Appeals, Federal Circuit.

Dec. 1, 2011.

Jeffrey D. Blake, Sutherland, Asbill & Brennan, LLP, of Atlanta, GA, argued for plaintiff-appellant. With him on the brief was David A. Reed.

Eric J. Fues, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, of Washington, DC, argued for defendants-appellees. With him on the brief were Ford F. Farabow, Jr. and Rama G. Elluru; and Charles E. Lipsey, of Reston, VA. Of counsel on the brief were, Jamie B. Bischoff and Marc J. Weinstein, Ballard Spahr, L.L.P., of Philadelphia, PA, and Judy Yun, AstraZeneca Pharmaceuticals, LP, of Wilmington, DE.

Before RADER, Chief Judge, LINN and DYK, Circuit Judges.

LINN, Circuit Judge.

Teva Pharmaceutical Industries Ltd. (“Teva”) appeals from the Eastern District of Pennsylvania's entry of summary judgment in favor of AstraZeneca Pharmaceuticals LP and IPR Pharmaceuticals Inc. (collectively “AstraZeneca”) invalidating claims 1, 26, 42, and 52 (“asserted claims”) of Teva's U.S. Patent No. RE39,502 (“'502 patent”) based on AstraZeneca's prior invention of the subject matter claimed therein. Because the district court correctly concluded that AstraZeneca's earlier development of the accused CRESTOR® drug (“AstraZeneca's drug”) formulation satisfied the requirements for prior invention under 35 U.S.C. § 102(g)(2), this court affirms.

I. Background

Statins are a class of compounds useful in the treatment of dyslipidemia. Statins are inherently unstable and, to be medically viable, must be manufactured in stabilized formulations. As relevant to this appeal, Teva's ' 502 patent is directed to statin formulations stabilized exclusively by an amido-group containing polymeric compound (“AGCP compound”) or by an amino-group containing polymeric compound. The '502 patent is a reissue of a patent that claims the benefit of a provisional application filed on April 10, 2000. The earliest date by which Teva asserts that it conceived and reduced to practice its claimed invention is December 1, 1999. Claim 1 of the '502 patent is representative of the asserted claims and recites:

1. A stabilized pharmaceutical composition for the treatment of dyslipidemia,

comprising

an active component consisting essentially of one or more compounds selected from the group consisting of (i) an IIMG–CoA reductase inhibiting ring-opened 7–substituted–3, 5–dihydroxyheptafloic acid or a pharmaceutically acceptable acid salt thereof, and (ii) an HMG–CoA reductase inhibiting ring-opened 7–substituted–3, 5–dihydroxyheptenoic acid or a pharmaceutically acceptable acid salt thereof, and

a stabilizing effective amount of at least one amido-group containing polymeric compound or at least one amino-group containing polymeric compound, or combination thereof, wherein said stabilized pharmaceutical composition does not contain a stabilizing effective amount of another stabilizer or a combination of other stabilizers.

'502 patent col.16 ll.17–33 (underlining added, italics in original).

In October 2008, Teva sued AstraZeneca for infringing the '502 patent based on AstraZeneca's manufacture and sale of the AstraZeneca drug, a stabilized statin (rosuvastatin calcium) formulation for the treatment of dyslipidemia. This drug was designed with tribasic calcium phosphate, which is not an AGCP compound, as a stabilizer. The drug also contains crospovidone, which is an AGCP compound. It is uncontested that AstraZeneca included crospovidone in the AstraZeneca formulation as a disintegrant, but did not understand crospovidone to have a stabilizing effect.

AstraZeneca moved for summary judgment of invalidity under 35 U.S.C. § 102(g)(2) alleging that it had conceived and reduced its drug to practice prior to Teva's first conception of the claimed subject matter. AstraZeneca made an undisputed showing that, in mid–1999, it manufactured a 10,000–unit batch of a rosuvastatin calcium formulation containing the same ingredients in the same amounts as its commercial drug. AstraZeneca made additional batches of rosuvastatin calcium in the summer and fall of 1999, also with the same ingredients in substantially the same amounts as the commercial drug. By late summer 1999, AstraZeneca had disclosed the ingredients and quantities for its rosuvastatin formulation matching those of all commercial drug dosage strengths. On the basis of these undisputed facts, the district court found that “there is no genuine issue of material fact as to whether AstraZeneca arrived at the same [AstraZeneca drug] product formulations that Teva accuses of infringement—and made batches of those formulations—before Teva conceived of or reduced to practice the subject matter of the '502 patent.” Teva Pharm. Indus. Ltd. v. AstraZeneca Pharm. LP, 748 F.Supp.2d. 453, 464 (E.D.Pa.2010).

Notwithstanding the inclusion of tribasic calcium phosphate—a non-AGCP-compound—as a stabilizer in AstraZeneca's drug, AstraZeneca conceded infringement for the limited purpose of advancing its summary judgment motion. Explaining that “an appreciation of the stabilizing effect of crospovidone by AstraZeneca, as opposed to its appreciation of the stabilization of its overall pharmaceutical composition that contained crospovidone, was not required,” id. at 469, the district court granted AstraZeneca's motion and held the asserted claims invalid over AstraZeneca's prior invention of its drug. Teva timely appealed and this court has jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).

II. Discussion

A. Standard of Review

Summary judgment is granted “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “This court reviews the district court's grant or denial of summary judgment under the law of the regional circuit.” Lexion Med., LLC v. Northgate Techs., Inc., 641 F.3d 1352, 1358 (Fed.Cir.2011). The Third Circuit “review[s] an order granting summary judgment de novo, applying the same standard used by the District Court.” Azur v. Chase Bank, USA, Nat'l Ass'n, 601 F.3d 212, 216 (3d Cir.2010) (quotation omitted). “Priority, conception, and reduction to practice are questions of law which are based on subsidiary factual findings.” Cooper v. Goldfarb, 154 F.3d 1321, 1327 (Fed.Cir.1998). This court exercises plenary review of the district court's legal conclusions regarding the requirements of 35 U.S.C. § 102(g), applying Federal Circuit precedent. See Research Corp. Techs., Inc. v. Microsoft Corp., 536 F.3d 1247, 1255 (Fed.Cir.2008) (“The Federal Circuit applies its own law with respect to issues of substantive patent law and certain procedural issues pertaining to patent law ....” (citations omitted)).

B. Arguments on Appeal

On appeal, Teva essentially argues that the district court misapplied § 102(g)(2) in failing to require AstraZeneca to prove that it appreciated the stabilizing effect of crospovidone in its drug formulation. According to Teva, the district court implicitly construed the claims to encompass stabilized statin formulations containing an AGCP compound, irrespective of whether the AGCP compound acted as the sole stabilizer. The thrust of Teva's argument is that this overbroad “construction” of the asserted claims effectively relieved AstraZeneca of its burden of proving that it created the claimed subject matter and appreciated that it had done so. Teva also argues that the district court improperly applied inherency precedent from the § 102(b) context, thus further obviating AstraZeneca's need to prove appreciation. Finally, Teva argues that, if AstraZeneca was the first to invent, then the district court erred by not finding that AstraZeneca had suppressed or concealed its invention by failing to disclose that crospovidone stabilized AstraZeneca's drug.

AstraZeneca responds that the district court correctly refused to require AstraZeneca to prove that it appreciated the stabilizing effect of crospovidone. According to AstraZeneca, Teva's claim construction argument is irrelevant because AstraZeneca's limited concession of infringement established that AstraZeneca's drug falls within the scope of the asserted claims. AstraZeneca argues that § 102(g)(2) does not require it to understand its own invention in the same terms in which Teva later claimed it, but only to understand the fact of what it made. AstraZeneca also argues that inherency does apply in the § 102(g) context and that AstraZeneca was not required to recognize inherent properties of its invention. Finally, AstraZeneca responds that Teva's “suppression or concealment” argument falls with its “appreciation” argument because, if AstraZeneca was not required to appreciate that crospovidone was a stabilizer, then it cannot have been required to disclose that it was.

C. AstraZeneca's Prior Invention

Because AstraZeneca conceded infringement for the limited purpose of its summary judgment motion, and because Teva maintains the allegation of infringement upon which its suit is based, it is undisputed for the purpose of this appeal that AstraZeneca's drug is an embodiment within the scope of the asserted claims. See Evans Cooling Sys., Inc. v. Gen. Motors Corp., 125 F.3d 1448, 1451 (Fed.Cir.1997) (“Although [defendant] bore the burden of proving that the [asserted prior art/accused product] embodied the patented invention or rendered it obvious for purposes of the summary judgment motion, this burden is met by [plaintiff's] allegation, forming the sole basis for the complaint, that the [asserted prior art/accused product] infringes.”). It is undisputed that AstraZeneca conceived and reduced its drug to practice before Teva's first conception of the claimed subject matter. It is also undisputed that AstraZeneca did not understand that crospovidone acted as a...