Bristol-Myers Squibb Co. v. Teva Pharms USA, Inc.

Declining to reconsider its panel decision holding that a pharmaceutical was obvious where a skilled artisan would have altered the lead prior art compound in the same manner suggested by claimed invention, the U.S. Court of Appeals for the Federal Circuit denied en banc review, rejecting the notion that the panel’s ruling had the effect of foreclosing consideration of later-discovered information. Bristol-Myers Squibb Co. v. Teva Pharms USA, Inc., Case No. 13-1306 (Fed. Cir., Oct. 20, 2014) (per curium) (Dyk, J., joined by Wallach, J., concurring in denial of petition for rehearing en banc) (O’Malley, J., concurring in denial of petition for rehearing en banc) (Newman, J., joined by Lourie, J., and Reyna, J., dissenting from denial of petition for rehearing en banc) (Taranto, J., joined by Lourie, J., and Reyna, J., dissenting from denial of petition for rehearing en banc).

Earlier, a unanimous panel of the Federal Circuit upheld a district court’s finding that a lead compound disclosed in the prior art rendered obvious the antiviral compound claimed in the patent-in-suit.  IP Update, Vol. 17, No. 7.  The Federal Circuit agreed with the district court that evidence discovered after the priority date showing toxicity of the lead compound did not alter the obviousness finding.

In her concurring opinion to the en banc denial, Judge O’Malley rejected the petitioners’ assertions that the panel’s decision foreclosed consideration of later-discovered differences between a claimed compound and the prior art.  According to Judge O’Malley, in their obviousness analyses, both the district court and the panel considered the later-discovered toxicity of the claimed compound; they just did not find it convincing.  “Ultimately, a case is won or lost on the record.”  Ample evidence showed that skilled artisans were treating the prior art compound as a lead compound.  Skilled artisans at leading companies were testing and developing it as an antiviral agent.  The expert for Bristol-Myers Squibb admitted surprise upon learning after the priority date that the compound was toxic.  Moreover, Bristol-Myers Squibb’s expert conceded that a skilled artisan could have been led to modify the lead compound to create the claimed invention.

Judge O’Malley further explained that the petitioners took words out of context when they characterized the original panel’s evaluation of unexpected results, misread the decision as requiring a burden-shifting analysis and mischaracterized the decision to require offsetting of secondary indicia.

Dissenting to the denial of en banc review, Judge Newman contended that the panel did not consider the later-discovered toxicity of the lead compound or the unexpected results raised by petitioners, as required under the law.

Also dissenting in the denial of en banc review, Judge Taranto asserted that the panel’s decision raised questions concerning the proper meaning of “reasonable expectation of success” and “unexpected results” in an obviousness analysis because of the decision’s treatment of the post priority date toxicity data.