Purdue Pharma L.P. v. Epic Pharma, LLC

Case Name: Purdue Pharma L.P. v. Epic Pharma, LLC, 811 F.3d 1345 (Fed. Cir. Feb. 1, 2016) (Circuit Judges Prost, Reyna, and Stark [sitting by designation] presiding; Opinion by Prost, C.J.) (Appeal from S.D.N.Y., Stein, J.)

Drug Product and Patent(s)-in-Suit: OxyContin® (oxycodone hydrochloride); U.S. Patents Nos. 7,574,799 (“the ’799 patent”), 7,674,800 (“the ’800 patent”), 7,683,072 (“the ’072 patent”), and 8,114,383 (“the ’383 patent”)

Nature of the Case and Issue(s) Presented: The patents-in-suit can be divided into two groups: (i) the Low-ABUK patents (the ’799, ’800, and ’072 patents), which claim an oxycodone salt with extremely low levels of a particular impurity, 14-hydroxycodeinone (“14-OHC”), which belongs to a class of potentially dangerous compounds known as alpha, beta unsaturated ketones (“ABUKs”); and (ii) the abuse-resistant formulation patent, the ’383 patent.

In March 2011, Purdue sued Teva for infringement of the low-ABUK patents. Between November 2011 and January 2013, Purdue filed similar lawsuits against Epic, Mylan, and Amneal. In addition, in June 2012, Grunenthal and Purdue jointly sued Teva for infringement of the ’383 patent. The two Teva cases were consolidated and joined with the Epic, Mylan, and Amneal cases, along with six actions involving other defendants. In September 2013, the district court held a three-week bench trial in the Teva cases, and found the asserted claims infringed but invalid as anticipated by or obvious over the prior art. Based on that decision, the district court dismissed the three remaining actions based on collateral estoppel. Plaintiffs appeal and the Federal Circuit affirmed.

Why Defendants Prevailed: First, relying on Eibel Process Co. v. Minnesota & Ontario Paper Co., 261 U.S. 45, 68 (1923) for the proposition that “where an inventor discovers a nonobvious source of a problem and then applies a remedy in response, the invention is nonobvious and worthy of a patent—even if the remedy, standing alone, would generally appear to be known in the art,” Purdue argued that the court failed to properly credit the discovery of 8α’s being the source of the 14-OHC impurity as the core of the claimed inventions. But the Federal Circuit, crediting the district court, found that the discovery of 8α was not necessary to the claimed invention: a skilled artisan would recognize that hydrogenation could be used to remove the remaining 14-OHC, regardless of the source of the 14-OHC. Purdue claimed the end-product—low-ABUK oxycodone—not the process for arriving at that end-product. Thus, the issue was whether it would be obvious to a person having ordinary skill in the art to use hydrogenation to remove the excess 14-OHC in the oxycodone API. The Federal Circuit found that one need not know that the 14-OHC was derived from 8α to answer that question. Having said that, the Federal Circuit found that the fact that 14-OHC is derived from 8α imparts no structural or functional differences in the low-ABUK hydrocodone API as compared to the prior-art products. Thus, the district court did not err in disregarding the process limitation in its obviousness determination.

Next, the Federal Circuit addressed secondary considerations. In dismissing Purdue’s commercial-success argument, the Federal Circuit noted that the manufacturer of low-ABUK API “was not successful at marketing its low-ABUK oxycodone API to any significant customer other than Purdue, which is its corporate affiliate.” Moreover, Purdue invested in its API manufacturer because of its cost of manufacturing, not because of low-ABUK oxycodone. The Federal Circuit dismissed any long-felt-need argument because there was no pressing need for companies to create a low-ABUK product before the FDA mandated that it be done in 2004. The FDA’s mandate also served as the basis for rejecting Purdue’s “unexpected results” argument because, the Federal Circuit reasoned, it was not surprising that after the FDA mandate manufacturers would create a low-ABUK oxycodone API or that they would do so using the known techniques available to a person of ordinary skill at that time.

Turning to the abuse-resistant-formulation patent, the district court concluded that the asserted claims were anticipated by McGinity. McGinity disclosed the use of hot-melt extrusion of high-molecular-weight polyethylene oxide (“PEO”) to create a controlled-release dosage form for pharmaceuticals. McGinity also disclosed opioid formulations and it inherently disclosed tablets with a breaking strength in excess of 500 N, as required by the asserted claims. Alternatively, the district court concluded that even if McGinity did not anticipate the ’383 patent, “a person of ordinary skill in the art would have had sufficient knowledge and motivation to make the invention claimed by the ’383 patent.” Grunenthal argued that because the only specifically mentioned drugs are non-opioids, McGinity does not describe formulations that contain opioids such as oxycodone. However, the Federal Circuit agreed with the district court that McGinity could not be read so narrowly. McGinity explicitly noted the use of its process with analgesics to treat pain, and the words “such as” and the residual clause “and the like” demonstrate that the application disclosed a broader group of analgesics than just those listed. Moreover, the record showed that oxycodone was one of the most widely prescribed analgesics at the time. The district court also noted that McGinity is directed to sustained-release dosage forms and credited expert testimony that the only analgesics on the market in a sustained-release form at the time were opioids.

Grunenthal also took issue with Defendants’ expert’s testing adequacy and reliability. Grunenthal argued that Defendants’ expert did not provide API release data, photographs after breaking-strength testing, or laboratory notebooks for his reproductions of the McGinity disclosures. The Federal Circuit credited the district court’s findings that Defendants’ expert “supplemented his own credibility with abundant documentary support in the form of raw data, photographs, and force curves.” Grunenthal also argued that Defendants’ expert did not perform a torque test on its reproductions, which would have shown if the extrusion was being accurately repeated. Again, however, the Federal Circuit relied on the district court’s analysis concluding that “because torque is not an input or setting in the extrusion process, the lack of torque data does not affect the reliability of [Defendants’ expert’s] process as a replication of the McGinity Application’s process.”

Finally, Grunenthal argued that Defendants’ expert did not perform any testing to confirm that the tablets he made according to the McGinity disclosures were controlled-release formulations. But, the Federal Circuit reasoned, Teva did not need to conduct any controlled-release testing because McGinity clearly disclosed PEO formulations with controlled-release properties.

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