The US Court of Appeals for the Federal Circuit affirmed a district court’s invalidity and infringement judgments for patents directed to a topical nonsteroidal anti-inflammatory drug, finding that a patent claim reciting a list “consisting essentially of” is indefinite where the basic and novel property of the invention is indefinite. HZNP Medicines LLC, Horizon Pharma USA, Inc. v. Actavis Laboratories UT, Inc., Case No. 17-2149 (Fed. Cir. Oct 10, 2019) (Reyna, J) (Newman, J, dissenting in part, concurring in part). The Court also found no inducement because the label for the allegedly infringing drug did not instruct users to perform the patented steps.

HZNP owns composition and method patents directed to topical diclofenac, a nonsteroidal anti-inflammatory drug that has been marketed to treat knee osteoarthritis as PENNSAID® 2%. Horizon was the original owner of these patents and filed a patent infringement lawsuit against Actavis after Actavis filed an abbreviated new drug application (ANDA) requesting approval to market a generic version of PENNSAID® 2%. During the course of the district court proceeding, HZNP became the owner of the patents and substituted itself as the plaintiff. During claim construction, the district court found that three terms in the asserted formulation patents were indefinite. It subsequently granted summary judgment of non-infringement on HZNP’s method of use patents. Finally, at trial, the district court found a remaining formulation patent non-obvious, and, based on the parties’ stipulation, infringed. Both parties appealed.

Addressing claim construction, the Federal Circuit agreed with the district court that the term “impurity A” present in several asserted formulation claims was indefinite because the intrinsic evidence did not refer to its identity or chemical structure. Further, the Court found that the meager information provided on the high performance liquid chromatography procedure used in eluting it would not direct a person of ordinary skill in the art to identify the compound in an external pharmacopeia. The Court also found that the term “degradation” was indefinite because Horizon defined it in terms of “impurity A.”

The Federal Circuit agreed with the district court that the term “consisting essentially of” was indefinite. It has been determined that when this clause proceeds a list of ingredients in a composition, the claim not only includes the items in the list but also is open to additional unlisted ingredients that do not materially affect the basic and novel properties of the invention. In this case, the Court found that the basic and novel properties of the invention were listed but not defined with reasonable certainty to allow a person of ordinary skill in the art to discern the scope of the properties. Specifically, the property of “better drying time” was indefinite because the methods for determining it as outlined in the specification (including the appropriate timeframe to evaluate), did not show consistent results.

Turning to invalidity based on prior art, the Federal Circuit affirmed the district court’s judgment of non-obviousness of a formulation patent. Actavis argued that an asserted patent covering the PENNSAID 2% formulation was an obvious modification of an earlier product, PENNSAID 1.5%. Many of the ingredients in PENNSAID 2% were present in PENNSAID 1.5%, but in different amounts, and an additional ingredient not present in PENNSAID 1.5% was present in PENNSAID 2%. The Federal Circuit agreed that the drug formulation involved complex and unpredictable art, where changing each ingredient affected the others. Therefore, developing PENNSAID 2% by modifying PENNSAID 1.5% was not obvious.

As to non-infringement, the Federal Circuit found that while Actavis’s drug label was similar to one of HZNP’s asserted method of use patents, it did not induce infringement of the patent. Actavis’s label stated “[w]ait until the area is completely dry before applying sunscreen, insect repellent, lotion,” while the patent recited a method with steps, including “waiting for the treated area to dry” and “subsequently applying a sunscreen, or an insect repellant.” The Federal Circuit found that Actavis’s label permitted, but did not instruct or require, a user to perform the patented steps. Therefore, the label did not provide the requisite intent to induce infringement.

Practice Note: The term “consisting essentially of” can broaden claim scope, but one must ensure that the invention’s properties are defined, or risk indefiniteness. Additionally, an ANDA label including information on all steps of a method patent does not induce infringement if it does not specifically require that the user to follow each step.