Novo Nordisk A/S v. Caraco Pharma. Labs., Ltd.

Case Name: Novo Nordisk A/S v. Caraco Pharma. Labs., Ltd., Fed. Cir. No. 2011-1223, 2013 U.S. App. LEXIS 12251 (Fed. Cir. June 18, 2013) (Circuit Judges Newman, Dyk, and Prost presiding; Opinion by Prost; Opinion concurring-in-part and dissenting-in-part by Newman) (Appeal from E.D. Mich., Cohn, J.)

Drug Product and Patent(s)-in-Suit: Prandimet® (repaglinide/metformin hydrochloride); U.S. Patent No. 6,677,358 (“the ’358 patent”)

Nature of the Case and Issue(s) Presented: The Federal Circuit faced two issues on appeal: whether the district court’s determination was correct that the claims were invalid as obvious and unenforceable on the basis of inequitable conduct.

The district court found, and the parties did not dispute, that Caraco set forth a prima facie case that it was obvious to try combination therapy using metformin and repaglinide to treat Type II diabetes. Combination therapy using insulin sensitizers and insulin secretagogues was common at the time of the invention, and metformin was the most widely-used insulin sensitizer as of the ‘358 patent’s filing date. The key question was whether repaglinide/metformin proved more effective than what would have been expected in view of the prior art, i.e., whether the combination yielded an unexpected synergistic effect. To undermine the examiner’s finding that the studies submitted by Novo Nordisk during prosecution had demonstrated synergy, Caraco introduced new prior art and evidence that the examiner had never considered, such as testimony from expert witnesses and Novo scientists. After reviewing Caraco’s evidence, the district court determined that an artisan would have expected repaglinide/metformin would yield some synergy. The court then considered, and rejected, the premise that Novo Nordisk’s studies had yielded an unexpected or superior level of synergy.

Novo Nordisk attacks the obviousness ruling on three grounds: (i) the district court misallocated the burden of persuasion in this case by forcing Novo Nordisk to “overcome” Caraco’s “prima facie” case of obviousness with evidence of unexpected results; (ii) if the burdens were properly allocated in this case, Caraco’s evidence insufficiently supported the court’s ultimate obviousness findings; and (iii) the district court should have deferred to the examiner’s original finding that the clinical studies demonstrated unexpected synergy. The Federal Circuit rejected all three of these arguments.

As to inequitable conduct, Novo argued that the district court’s findings were error because the omissions did not amount to materiality under Therasense. The Federal Circuit agreed.

Why Caraco Prevailed: The district court found that Caraco’s prima facie evidence, if unrebutted, would be sufficient to establish that the repaglinide/metformin combination was obvious to try, and that a person of ordinary skill in the art would have reasonably expected the combination would yield success in the form of beneficial, and even synergistic, results. As such, the Federal Circuit found that it was entirely appropriate for the district court to next consider whether Novo Nordisk’s countervailing secondary consideration evidence of unexpected synergy was sufficient to “overcome” Caraco’s prima facie case. The Federal Circuit held that as long as the court reserved its ultimate conclusion on validity until after it considered the evidence from both sides, it had not misallocated the burden of persuasion.

The Federal Circuit found no clear error in the district court’s finding that the claimed results would have been expected by one of skill in the art.  The art showed that combining similar drugs would have a synergistic effect, such that one of skill would expect a similar result with the claimed combination. 

The Federal Circuit rejected Novo’s argument that the district court should have given deference to the examiner’s finding.  The cases and statute cited by Novo were inapplicable as Novo was not appealing the rejection of the patent application by the PTO.  The Federal Circuit held that it would treat the issued patent as having a presumption of validity that must be overcome by clear and convincing evidence. No decision of the Supreme Court or the Federal Circuit has ever suggested that there is an added burden to overcome USPTO findings in district court infringement proceedings.

Finally, the Federal Circuit reversed the district court’s finding of unenforceability because the omissions relied on by the district court did not rise to the “materiality” standard as set forth in Therasense. The Federal Circuit found the omissions troubling, but not “material.” Therefore, the omissions did not rise to the level of showing that patentability would not have been obtained but for the omission.

In her opinion, Judge Newman agreed that Novo Nordisk had not engaged in inequitable conduct. But Novo Nordisk’s discovery of the synergistic combination of metformin and repaglinide met the criteria of patentability, and was incorrectly held to be unpatentable on the ground of obviousness. Judge Newman wrote that the obviousness determination in this case related to a synergistic combination of two diabetes drugs. The combination described and claimed in the ’358 patent is eight-fold more effective than the additive properties, and is now apparently a treatment of choice for persons whose Type II diabetes had previously been untreatable. It is a lifesaving combination for such persons, and is valuable to other diabetics, for it permits a more flexible treatment regimen than prior products. The Novo Nordisk inventors pursued this combination despite the advice of other “experts” that they were wasting time and money. Judge Newman therefore dissents because the majority found that combination obvious.

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