by
According to the Federal Circuit’s holding in the latest SmithKline v. Apotex case, a patent claim to a compound is inherently anticipated by a reference that enables preparation of that compound, even
without evidence that the compound existed before the patent application was filed. This seems to reinforce and broaden the
inherent anticipation doctrine of the recent Schering v. Geneva decision, where a description of methods to use a drug inherently anticipated later claims to a metabolite formed in the bodies
of patients treated with that drug. Under the Schering standard, a patent claim was invalid because evidence showed that the substance had been formed before the patent application
was filed, even though neither its existence nor its structure was recognized. Under the new SmithKline standard, inherent anticipation can invalidate a patent even though the claimed substance was not formed in detectable quantities,
and possibly even if the claimed substance never existed—as long as it could have been made by methods disclosed before the
application was filed. This article summarizes the SmithKline decision and suggests claim drafting strategies that may provide protection in such situations.
The latest SmithKline decision vacates a troubling prior Federal Circuit decision, which held that a clinical trial of a drug candidate compound
could be a public use that would invalidate a patent claiming the compound. However, SmithKline replaces the vacated decision with a new one invalidating the same patent for a different reason. The new decision raises
issues that especially impact pharmaceutical and biotechnology patents. In fact, Judge Newman said the new decision calls
into question "the patentability of antibiotics, hormones, antibodies, and myriad other previously unknown or unisolated products."1
The SmithKline case revolves around paroxetine hydrochloride (PHC), the active ingredient in the billion-dollar drug Paxil®. SmithKline
launched Paxil® in 1993, about the time the patent on the original "anhydrate" form of PHC expired. However, the company
did not register the anhydrate form: the drug registered as Paxil® is a hemihydrate, a novel crystal form that was discovered
during drug development. The hemihydrate contains one molecule of water for every two molecules of PHC. It is easier to
handle than the anhydrate form of PHC, which contains no water molecules; and the patent claiming it will not expire until
2006.
Apotex filed an ANDA in 1998, proposing to make PHC anhydrate according to the expired patent. As part of its ANDA filing,
Apotex stated that its product would not infringe the hemihydrate patent. SmithKline sued, alleging that the Apotex product
would infringe. According to SmithKline, formation of some of the hemihydrate is unavoidable in a facility that is seeded
with crystals of the hemihydrate, and the evidence showed that Apotex’s plant has been seeded. SmithKline asserted that now
Apotex could not produce PHC anhydrate without making some hemihydrate, or that PHC anhydrate made by Apotex would convert
into hemihydrate because it would be exposed to hemihydrate seed crystals and moisture.
Only claim 1 was in issue: "Crystalline paroxetine hydrochloride hemihydrate."2In the first decision, now vacated, the court invalidated claim 1 because the hemihydrate was in public use more than 12 months
before the U.S. patent application was filed.3 The public use was a clinical trial in which the doctors and patients knew what compound was being tested.4 SmithKline claimed the clinical trial was an ‘experimental use,’ which is not considered a public use. However, the court
held that the clinical trial only tested the safety and efficacy of the hemihydrate as an antidepressant, not any claimed feature or limitation of "crystalline paroxetine hydrochloride hemihydrate"; therefore it was not an ‘experimental use’ with
respect to claim 1. Because the clinical trial was deemed a public use and occurred more than 12 months before the patent
application was filed, it invalidated claim 1.
The Federal Circuit vacated the public use portion of its original opinion while sitting en banc (all the judges participated except Judge Lourie). That suggests that most of the judges were uncomfortable with the first
opinion. If the same factual situation arose today, the Federal Circuit would probably view the clinical trial as an experimental
use rather than a public use.5 Unfortunately, the court did not discuss its reasons for vacating the first holding, so the outcome on those facts is not
certain. The en banc court simply remanded the case to the same panel who heard it the first time, and the panel immediately published a new opinion.
In its new opinion, the court pointedly retained some of the holdings from the vacated opinion that are important to patentees
of chemical inventions. The court reiterated its holdings that the claim to the hemihydrate covers any amount of hemihydrate,
even if the amount is not detectable, and that Apotex would infringe the hemihydrate patent if its product contained even
a single undetectable crystal of the hemihydrate.6 Since claim 1 resembles a typical compound claim, this suggests that most compound claims would likewise be infringed by
the manufacture, sale, or use of any amount of the claimed substance.
It is important to recognize that the court in SmithKline was not deciding whether material actually made by Apotex infringed the patent claim. Because this suit was based on an
ANDA filing rather than on actual infringement, the court had to determine prospectively whether Apotex would infringe if
it manufactured PHC in the future. Apotex had already made batches of PHC, but only for registering its generic drug: those batches did not infringe because
the Hatch-Waxman Act, 35 U.S.C. § 271(e)(1), permits such activities for the purpose of registering a generic drug. Thus
the PHC already made by Apotex was only evidence of what would happen if Apotex were permitted to manufacture PHC for sale
before the hemihydrate patent expired. The evidence at trial showed that Apotex’s product would contain at least traces of the hemihydrate, although perhaps not a detectable amount. The appeals court therefore held that
Apotex’s product would infringe claim 1 of the patent, which covered any amount of the hemihydrate.
Claim 1 was given the same scope for analysis of its validity: just as an undetectable amount would infringe the patent,
it could also invalidate the patent by anticipation if it existed before the application. The court found that the methods
of the expired patent would produce at least traces of hemihydrate, just as SmithKline insisted, so the compound itself was
not novel when SmithKline filed its patent application for the hemihydrate. Even though the hemihydrate was not previously
known or recognized, the court reasoned that the methods of the expired patent enabled one of ordinary skill to produce it,
because there was no clear evidence that making the hemihydrate required a process different from the process for making the
anhydrate. Therefore, the expired patent ‘inherently’ anticipated claim 1 of the hemihydrate patent.
The inherent anticipation doctrine is not new, of course, but its scope seems to be broadened by the new SmithKline decision. A recent case, Schering v. Geneva, clarified the standards for inherent anticipation in compound patents. In Schering, a patent claiming a metabolite of a drug was invalid because the metabolite was inherently anticipated by prior uses of
the drug.7 Evidence showed that the metabolite ‘necessarily and inevitably’ formed when the drug was ingested: the drug was given
to 864 patients, "all of whom formed measurable amounts" of the metabolite. It seemed important to the Schering court that the inherently anticipating metabolite was always formed in detectable amounts, even though it had not actually been detected; the court also noted that the metabolite was an active form of the drug. Schering thus held that a drug metabolite was inherently anticipated by methods of administering the drug to a patient: neither the
existence nor the structure of the metabolite needed to be recognized for inherent anticipation to arise, as long as the metabolite
was always formed, and was the natural result of practicing the prior art. But Schering did not clarify whether the amount
or the activity of the metabolite was important.
In SmithKline, the court now finds inherent anticipation even though there is no clear and convincing evidence that the methods of the
PHC patent would produce a detectable amount of the hemihydrate, or that any hemihydrate would have been formed before the
filing date of the hemihydrate patent application.8 This suggests that inherent anticipation can arise even if no detectable or relevant amount of the substance existed prior
to the filing of a patent application.
The SmithKline opinion states that inherent anticipation requires only an enabling disclosure, not awareness of or reduction to practice
of the inherent subject matter.9 However, it is not clear at what point enablement should be assessed. There was no evidence that the off-patent method
would have produced hemihydrate when the application claiming the compound PHC was filed in 1975. Indeed, the appellate court
accepted the trial court’s finding that there was no ‘clear and convincing’ evidence that the hemihydrate existed at all prior
to SmithKline’s discovery of it in 1985. The court also said, "whether it was actually possible to make pure PHC anhydrate
before the critical date of the [hemihydrate] patent is irrelevant ... the [PHC] patent discloses a method of manufacturing
PHC anhydrate that naturally results in the production of hemihydrate." This seems to indicate that the court assessed enablement
at some time after the critical date for the patent, since the trial court only concluded that the hemihydrate was the ‘natural
result’ of making PHC in a seeded environment, and there was no evidence of any source of hemihydrate ‘seed crystals’ before
1985, or possibly 1984.
As Judge Newman observed when dissenting from the denial of a full rehearing, the new decision calls into question the validity
of patents to "any antibiotic, hormone, or antibody that existed anywhere in nature, even though unknown and undetected, prior
to the filing of an application claiming the chemical species." Such a broad inherent anticipation doctrine seems to allow
a described process to anticipate every compound X that could result from that described process, based on later evidence
that practicing the process produces at least a trace amount of X, whether or not X was relevant, expected, or detected.
There are two unusual elements in this decision. First, the Federal Circuit panel appears to find as a fact that the prior
art method necessarily produces some hemihydrate; but according to the trial court this was only established as a ‘fact’ in
a seeded facility. Second, the appeals court apparently discussed the basis for the panel’s new decision while deciding to
deny en banc review of the first Federal Circuit decision, since Judge Newman, who was not on the SmithKline panel, wrote a dissent that was entirely based on objections to the new opinion. This seems odd, since a decision on rehearing
the first decision should not require consideration of alternative outcomes; more importantly it suggests that the majority
of the judges discussed and approved of the new decision. The SmithKline decision thus suggests that a broad inherent anticipation doctrine is generally accepted by the Federal Circuit.
Logically, the result in SmithKline should allow Apotex to practice the expired PHC patent: that, after all, is central to the social bargain that a patent
represents. The Federal Circuit did achieve that result. However, the impact of its broadening of the inherent anticipation
doctrine may be detrimental to patentees of certain chemical inventions. Judges Lourie and Newman dissented from the denial
of en banc rehearing in Schering, because they found the inherent anticipation doctrine too broad. SmithKline seemingly makes the rule even broader, which
prompted Judge Newman’s latest commentary. As a policy matter, it is not clear that a broad inherent anticipation rule is
good: it places patentees in the uncomfortable position of not knowing whether their patents might be invalidated by a reference,
perhaps not even closely related to their own research. For example, a patent on a new compound with pharmaceutical activity
could be invalid if the compound was later shown to be a metabolite of some other drug, even if the other drug was used for
a seemingly unrelated purpose. Such heightened uncertainty reduces incentives for research and for disclosure in the form
of patents.
Because of the importance of this case to SmithKline, it seems likely to resurface.10 For now, though, it should serve as a reminder that patent applicants should be particularly careful when drafting claims
to a chemical species that could have existed before the application was filed, such as a new polymorph of a known compound,
an isolated natural product, or a drug metabolite. For example, a claim to ‘compound X’ may be anticipated by later discovery
that X is produced or enabled by methods in the prior art. But a claim to ‘substantially pure’ compound X would not be so
easily anticipated, and a claim to ‘a pharmaceutical composition comprising compound X’ might not be. Of course a claim to ‘substantially pure compound X’ might not stop a competitor from making a mixture containing
X; so it may be prudent to claim a pharmaceutical composition comprising X, too, or to claim a mixture containing at least
a certain percentage of X.11 This case also reinforces the importance of using claims of multiple types (uses, compositions, formulations, product-by-process)
and varying scope, since the oft-favored compound claim proved most easily invalidated in this instance. A compound claim
might be anticipated under this standard, while a claim to its use or methods of making it might still provide effective protection.
Such claims would not have prevented Apotex from making PHC containing traces of hemihydrate, but they would generally ensure
that patent applicants retain some protection for their primary inventions. This broadening of the inherent anticipation
doctrine thus illustrates why inventors of chemical inventions should develop a claim drafting strategy in consultation with
a skilled patent attorney who understands their invention, their business strategy, and the current state and trends of the
ever-changing U.S. patent law.
Footnotes:
1). SmithKline Beecham Corp. v. Apotex Corp., 03-1285, -1313, 2005 U.S. App. LEXIS 5675, 2005 WL 788426 (Fed. Cir. 2005). The en banc decision and new opinion are also
available online at the Federal Circuit’s web site, www.fedcir.gov in the Daily Log for April 8, 2005.
2) That is the entire first claim of U.S. Patent No. 4,721,723, and is the only patent claim asserted by SmithKline.
3) SmithKline Beecham Corp. v. Apotex Corp., 365 F.3d 1306, 70 U.S.P.Q.2d 1737 (Fed. Cir. 2004).
4) The record suggests that the doctors and subjects involved in the clinical trial were not under any secrecy obligation.
Neither their knowledge of the compound nor the absence of confidentiality agreements necessarily rendered the trial a public
use, but proper confidentiality agreements should have prevented the clinical trial from being considered a public use.
5) Whether a particular use is ‘public’ or ‘experimental’ is decided by the court (it is a question of law), based on underlying
facts. Here, the court may have disagreed with the precedent created by the first opinion, or they may have felt that the
factual record for the decision was incomplete rather than that the decision was incorrect.
6) The district court had said that the claim would be indefinite and hence invalid if it covered an undetectable amount
of hemihydrate; it construed the claim to require a detectable or a ‘commercially significant’ amount of hemihydrate. SmithKline Beecham Corp. v. Apotex Corp., 247 F. Supp. 2d 1011 (N.D. Ill. 2003). However, the Federal Circuit overturned that claim construction and held that the
claim covered any amount, even a single undetectable crystal.
7) Schering Corp. v. Geneva Pharm., Inc., 339 F.3d 1373 (Fed. Cir. 2003).
8) The district court heard testimony from an expert who was "absolutely convinced" that no hemihydrate existed before December
1984, when a batch of PHC made by SmithKline contained it; but the court found that "no one knows when the hemihydrate form
of paroxetine came into existence." 247 F. Supp. 2d 1011, 1022 (N.D. Ill. 2003).
9) It is often stated that inherent anticipation only arises if an omitted claim limitation necessarily results from practicing
a prior invention. See, e.g., Toro Co. v. Deere Co., 355 F.3d 1313 (Fed. Cir. 2004). It is not clear that hemihydrate would necessarily result from practicing the methods
in the expired patent--certainly not in an unseeded environment, or before the discovery that led to the patent on the hemihydrate.
10) Or perhaps not: SmithKline recently settled an antitrust claim related to this litigation, agreeing to pay $65 million
to consumer groups to settle claims that SmithKline engaged in sham litigation to extend its patent monopoly on Paxil.® Nichols v. SmithKline Beecham Corp., 00-cv-6222 (E.D. Pa. 2005).
11) In fact, SmithKline’s patent on the hemihydrate included claims to ‘substantially pure’ hemihydrate; but those claims
could not credibly be asserted against Apotex, since the samples of PHC that Apotex made were primarily, if not entirely,
the anhydrate form. Thus those claims were not litigated and were not held invalid—nor did they enable SmithKline to exclude
Apotex from producing PHC containing traces of hemihydrate.
