Judges: Newman (dissenting), Friedman, Mayer (author)

[Appealed from D.N.J., Judge Sheridan]

In Bayer Schering Pharma AG v. Barr Laboratories, Inc., No. 08-1282 (Fed. Cir. Aug. 5, 2009), the Federal Circuit affirmed the district court’s ruling that U.S. Patent No. 6,787,531 (“the 531 patent”) was invalid for obviousness.

Bayer Schering Pharma AG (“Bayer”) is the owner of the ’531 patent, which covers the oral contraceptive Yasmin®, containing the active ingredient drospirenone. Drospirenone has diuretic and anti-acne properties, which are desirable qualities in an oral contraceptive. However, exposure to acid isomerizes drospirenone into a nondiuretic isomer. In addition, drospirenone is a poorly water soluble hydrophobic composition. Because it will not easily dissolve in liquid, its bioavailability is degraded. One method of increasing the bioavailability of poorly water soluble drugs is to micronize them. However, micronization also increases a drug’s sensitivity to acid. A method of combating the acid-sensitivity problem with an oral drug is to deliver the drug via an enteric-coated pill.

Bayer began developing a micronized form of drospirenone in 1983. Based on in vitro studies of micronized drospirenone, Bayer expected the micronized drug to have reduced bioavailability due to increased acid sensitivity. Therefore, it planned studies using an enterically coated form of drospirenone. In 1988, Bayer also planned studies on other formulations, including a normal or nonenterically coated form of drospirenone. The result of the studies showed that both normal pills and enterically coated pills had the same bioavailability. Bayer therefore developed drospirenone in a normal pill, for which it would eventually receive the ’531 patent. During prosecution, Bayer relied on the finding that drospirenone would absorb with a normal pill to overcome an obviousness rejection. The examiner allowed the claims, giving the specific reason that the prior art suggested that micronizing drospirenone would not work.

Barr Laboratories, Incorporated (“Barr”) is a generic drug manufacturer that filed an ANDA seeking FDA approval to market a generic version of Yasmin®. Bayer responded to the ANDA by filing suit for patent infringement. The parties agreed that if the ’531 patent was valid, Barr infringed various claims of the patent. However, Barr alleged, among other defenses, that the ’531 patent was invalid for obviousness. The district court found that the asserted claims were invalid as obvious. It found that it would have been obvious to a person of ordinary skill in pharmaceutical formulation to try a normal pill in formulating drospirenone as an oral contraceptive.

On appeal, Bayer represented that the innovation was to micronize the drospirenone to increase its bioavailability, and that the micronized drospirenone would absorb with a normal pill, against the teachings of the prior art. As to micronization, the Court noted that

Bayer’s own expert testified that micronization is the first choice solution because it presents the best chance for success. Accordingly, there was adequate support for the district court’s conclusion that one of skill would have seen micronization as a viable option.

Regarding enteric coatings, the district court found that the prior art recognized the necessity of using enteric coatings with acid-sensitive drugs, but that enteric coatings also have drawbacks, such as reduced or variable bioavailability. The district court held that it would have been obvious for a person skilled in the art to try a normal pill in formulating drospirenone as a contraceptive. The Federal Circuit agreed. The Court found that while Bayer argued the prior art teaches away from using micronized drospirenone, and Barr argued that the prior art teaches away from using an enteric coating, the parties presented the options available to a pharmaceutical formulator to solve the problem of acid-sensitive but hydrophobic drospirenone.

The district court found that, based on prior art bioavailability testing on spirorenone, a related compound of drospirenone, one of skill in the art would access these studies when formulating drospirenone and be led to believe that drospirenone may absorb in vivo but isomerizes in vitro. Bayer argued that the district court ignored key differences between the two compounds. But the Court found these differences irrelevant because the prior art was not an anticipatory reference. Moreover, the prior art showed that a drug formulator had a viable known option to consider and a reasonable expectation that drospirenone would perform similarly to spirorenone.

The Court also rejected Bayer’s argument that the prior art taught away from allowing exposure to the gastric environment, thus suggesting the need for an enteric coating. Barr attacked the merits of the in vitro study, noting that it would not apply to the practice of drospirenone in vivo. The panel majority stated that at this point, a person having ordinary skill in the art must choose between two known, predictable options—delivery of micronized drospirenone by a normal pill or delivery of drospirenone by an enteric-coated pill. The prior art would have funneled the formulator toward these two options. The Court found that the formulator would not have been required to try all possibilities in a field unreduced by the prior art. And the prior art was not vague in pointing toward a general approach or area of exploration. Rather, the prior art guided the formulator precisely to the use of either a normal pill or an enteric-coated pill. The Court concluded that because the selection of micronized drospirenone in a normal pill led to the result anticipated by the prior art, the invention would have been obvious. Accordingly, the Court affirmed the district court’s judgment.

Judge Newman dissented, noting that the evidence showed, without contradiction, that it was known that micronized drospirenone rapidly degraded at the acidity of stomach acid and that the Bayer scientists believed that the product required an enteric coating. Judge Newman stated that the majority improperly discounted the testimony of the scientists and ignored the evidence in finding that the invention was obvious to try. Furthermore, Judge Newman noted that contraceptives require complete effectiveness and it was undisputed that it was not reasonably expected that uncoated micronized drospirenone would be 99+% effective as an oral contraceptive. Judge Newman found that the majority’s “exercise of judicial expertise to override the clear evidence of how persons of skill in this field actually behaved, is inappropriate.” Newman Dissent at 4.