Petitioners should beware gaps in their evidence and reasoning. Two DepoMed patents recently survived their second IPR challenge because the petitioner failed to meet its burden of proof. The PTAB rejected petitioner’s obviousness arguments as “overly vague and nonspecific,” concluding that petitioner failed to “explain persuasively why or how a person of ordinary skill in the art would modify the drug formulation” of the prior art to develop the claimed formulation, and failed to show a reasonable expectation of success. The petitioner’s case was further hindered by the admission of its own expert that achieving the type of formulation claimed was very difficult. Endo Pharmaceuticals Inc. v. DepoMed, Inc., IPR2014-00654 and -00656 (Final Written Decisions, September 21, 2015).

The patents involved in these two IPRs are involved in seven different district court litigations, including one in which Endo Pharmaceuticals is the defendant. Endo chose the patent office as the venue for its prior art challenges, filing a total of five IPR petitions against the three patents-in-suit (U.S. Patent Nos. 6,340,475, 6,635,280 and 6,723,340). The counterpart litigation was stayed pending outcome of the IPRs.

Endo’s IPR of the ’340 patent ended favorably, with a final written decision holding all claims unpatentable as obvious over the cited art. Endo Pharmaceuticals Inc. v. DepoMed, Inc., IPR2014-00652 (Final Written Decision, September 16, 2015). Endo’s IPRs of the ’475 and ‘280 patents did not fare so well, echoing the unfavorable outcome of Purdue Pharma’s IPR challenges of the same two patents. Purdue Pharma LLP v. DepoMed, Inc. (IPR2014-00377 and -00379, July 8, 2015) (final written decisions holding that Purdue Pharma had not proven unpatentability).

For the ’475 and ’280 patents, Endo had taken the approach of dividing its arguments into two petitions: one petition asserting anticipation, and relying on a declaration by a Dr. Park previously submitted by Purdue Pharma; and the other petition asserting obviousness. The ’280 patent issued based on a continuation of the ’475 patent and its claims share many of the same elements.

The IPR petitions alleging anticipation were denied. The major factor underlying the denial was the inadequacy of the expert evidence showing that the prior art formulations inherently possessed the claimed properties. In the PTAB’s opinion, “Petitioner failed to establish that the dosage form Dr. Park prepared was actually the same as the dosage form that [the prior art] prepared.” The PTAB suggested, for example, that Dr. Park could have subjected the tablets he prepared to the same dissolution study reported in the prior art to demonstrate that his tablets achieved the same results as the prior art.

Endo’s petitions alleging obviousness were granted, and trial proceeded. The PTAB was convinced that Endo had shown that each of the claim limitations was disclosed, separately, in the cited prior art. The PTAB’s unfavorable decision, however, was based on the view that Endo had not met its burden of showing “by a preponderance of the evidence that a person of ordinary skill would have combined the teachings in the manner recited by the claims with a reasonable expectation of success.”

Endo’s reasoning for combining the art was that the references were all directed to solving the same problem of controlled release formulations, that they each described polymer matrices that swell when hydrated, and that the teachings were “compatible” and “interrelated”. The PTAB, however, found Endo’s reasoning to be vague and nonspecific, regarding both the disclosure of specific claim elements and the reason to combine. As one example of the failure to point to disclosure of specific claim elements, the PTAB noted that petitioner failed to show that one publication disclosed release of “at least 80% [substantially all] of said drug” in gastric fluid, and that the drug satisfied the solubility limitation of the claims. The PTAB agreed with the patent owner that the obviousness challenge “amounts to picking and choosing certain preferred attributes of the various references and combining them to yield the claimed invention [citing the patent owner response]. . . . We are also persuaded by [patent owner expert] Dr. Hopfenberg’s testimony that such a piecemeal combination reflects impermissible hindsight.”

Regarding the reasonable expectation of success, the PTAB gave more credit to the testimony of the patent owner’s expert than the petitioner’s expert. Petitioner’s own declarant had admitted that “formulating a reliable gastric retentive controlled release dosage form is ‘very difficult.’” In contrast, the PTAB found that the patent owner’s declarant credibly explained why the person of ordinary skill would not have had a reasonable expectation of success. As an example, the final decision pointed to his testimony that one would have expected the drug release characteristics to change if the dosage forms were reformulated to combine the various properties from the different prior art references.

…if the original IPR petition and supporting evidence have not been crafted to fill in all of the gaps, then the IPR will ultimately fail.

Although the patent owner had alleged a number of secondary considerations, including long felt need and commercial success, the PTAB did not even consider those because petitioner had not proven by a preponderance of evidence that any of the challenged claims was obvious. This story is a cautionary reminder that the burden of proving obviousness falls on petitioner, and that the petitioner’s case should be complete and fully established in its petition. During the IPR, petitioner does not have the right to present additional evidence; if the original IPR petition and supporting evidence have not been crafted to fill in all of the gaps, then the IPR will ultimately fail. And that failure could be devastating to the litigation where the petitioner will be estopped from raising invalidity challenges it reasonably could have raised in the IPR.