In an unusual ruling, the Patent Trial and Appeal Board (PTAB) granted a petitioner’s request for rehearing and instituted inter partes review (IPR) on a previously denied ground, finding that it previously had applied an overly restrictive standard when analyzing whether the patented invention would have been obvious. Incyte Corporation v. Concert Pharmaceuticals, Inc., Case No. IPR2017-01256 (PTAB, Apr. 9, 2018) (Hulse, APJ) (Fitzpatrick, APJ, dissenting in part).

Concert Pharmaceuticals owns a patent with claims covering CTP-543, a chemical compound being evaluated for treatment of hair loss. According to Concert, the compound was discovered by applying deuterium chemistry to modify ruxolitinib to create a deuterated ruxolitinib resistant to cytochrome P450-mediated oxidative metabolism, resulting in improved safety, efficacy and tolerability compared to its non-deuterated counterpart.

Incyte filed an IPR petition challenging Concert’s patent on anticipation and obviousness grounds. In its institution decision, the PTAB denied the petition on all grounds. Incyte subsequently requested rehearing on two obviousness grounds, arguing that the PTAB erred by applying a narrow legal standard for finding “structural obviousness” and requiring it to show that one of ordinary skill in the art would have been motivated to deuterate ruxolitinib to obtain compounds with superior properties. Specifically, Incyte argued that the patented claims were obvious in view of cited references’ disclosure of a genus of deuterated ruxolitinib compounds, identification of particular sites associated with oxidative metabolism, and the ability to create new derivatives with improved safety and/or efficacy. Incyte also argued that a motivation to modify a lead compound need not be fueled by a pursuit of improvement but rather could arise from an expectation to obtain compounds with “similar properties.”

The PTAB agreed with Incyte. Regarding the first part of the test for structural obviousness, while noting that Incyte did not conduct a formalistic lead-compound analysis, the PTAB nonetheless found that ruxolitinib’s useful properties would have motivated a chemist to make structurally similar compounds. Regarding the second part of the test, the PTAB found that expert testimony and statements made by Concert’s CEO evidenced recognition that the deuterated variants would have been expected to possess at least similar efficacy and safety profiles to that of the non-deuterated compounds. The PTAB concluded that it had substantively misapplied the law by requiring an express motivation in the prior art to modify a lead compound.

In rebuttal, Concert relied on its own expert testimony as well as evidence of unexpected properties of deuterated analogs. The PTAB found that competing testimonial evidence forwarded by the parties raised a genuine issue of material fact that required resolution via an IPR proceeding.

The majority also disagreed with an alternate theory of obviousness forwarded by Incyte based on a US Food and Drug Administration label. However, APJ Fitzpatrick dissented in part, finding that Incyte made a sufficient showing that the label was both a printed publication and prior art to the claims of the challenged patent, and that there was a reasonable basis to examine this alternate theory of obviousness.