Galderma Laboratories, L.P. v Tolmar, Inc.,‎ 2013-1034 (Fed. Cir.) (12/11/13)‎

The proper test for obviousness is whether the claimed invention as a whole would have been obvious ‎and not whether prior art provides the motivation to meet a critical parameter in the claims. The Federal ‎Circuit reversed a determination of validity based on misstatement of the test for obviousness, and ‎misapplication of the doctrines of teaching away, unexpected result, and commercial success.‎

Tolmar filed an Abbreviated New Drug Application ("ANDA") action seeking to market a generic version ‎of Galderma's Differin Gel. In a bench trial, the district court ruled against Tolmar. The claims at issue ‎included composition and method claims for treating acne using various compositions. The district court ‎framed the obviousness inquiry as requiring Tolmar to provide motivation in the prior art to triple the ‎concentration of adapalene, one of the components, to arrive at the claimed range. The Federal Circuit ‎panel held that Tolmar carried no such burden. Instead, all Tolmar was required to show was that the ‎differences between the claimed invention and the prior art are such that the claimed invention as a whole ‎would have been obvious. Citing KSR, the panel held that Tolmar was not required to prove obviousness ‎by starting with a prior art embodiment and then providing motivation to alter that embodiment. ‎According to the panel, this is particularly true where, as here, the prior art teaches a range that ‎encompasses both the prior art embodiment and the claimed invention. In these circumstances, the ‎burden of production falls on the patentee to come forward with evidence that (1) the prior art taught ‎away from the claimed invention; (2) there were new and unexpected results relative to the prior art; or (3) ‎there are other pertinent secondary considerations. ‎

With respect to teaching away, the panel noted that the fact that increasing the amount of adapalene up ‎to 0.1% generally increases side effects, does not mean that that prior art teaches away from using the ‎claimed 0.3% concentration; that is, there is nothing in the prior art to suggest that increasing ‎the concentration to 0.3% would be unproductive or that the side effects would be serious enough to ‎dissuade the use of 0.3%.‎

As to unexpected results, the district court found that a skilled artisan would have expected that tripling ‎the concentration of adapalene would have dramatically increased the side effects. The panel determined ‎that, while this result may have been unexpected, unexpected results that are probative of ‎nonobviousness are those that are different in kind and not merely in degree. Where an unexpected ‎increase in efficacy is measured by a small percentage, as here, the result constitutes a difference in ‎degree, not kind. ‎

As to commercial success, the district court noted that the fact that Tolmar seeks to enter the market is ‎precisely because Galderma's Differin has been commercially successful. But the panel pointed out that ‎that is true in every ANDA case if not every patent case. The fact that Tolmar thinks it can make a profit ‎selling a generic version reveals very little about the level of commercial success of the patented ‎invention relative to the prior art.‎

The district court also relied on the fact that Differin quickly gained market share once it was ‎introduced. But the panel noted this was because there were other Galderma patents blocking the ‎introduction of competing acne drugs until 2010, long after Galderma's 0.3% adapalene composition was ‎introduced. Commercial success is relevant in some cases because the law presumes an idea would have been ‎successfully brought to market sooner had the idea been obvious. This rationale does not apply where ‎the market entry by others is precluded due to blocking patents.‎

Accordingly, the majority of the panel reversed the district court's finding that the claims were not invalid.‎

Judge Newman dissented, noting that the majority gives short shrift to the presumption of validity, and ‎fails to provide clear and convincing evidence of invalidity. Specifically, she argues that the burden of ‎overcoming a district court's factual findings is heavy, including those relating to the secondary considerations ‎of nonobviousness. Judge Newman is also critical of the majority's shifting of the burden of production ‎to the patentee, and contends that the majority never required Tolmar to meet its evidentiary burden of ‎proving invalidity by clear and convincing evidence.