September 17, 2018

Blocking Patent Can Explain Long-Felt But Unmet Need, Reducing Importance of Objective Indicia of Nonobviousness

By Bryan K. Wheelock, Principal

In Acorda Therapeutics, Inc. v. Roxane Laboratories, Inc., [2017-2078, 2017-2134] (September 10, 2018), the Federal Circuit affirmed the judgment that the asserted claims of U.S. Patent Nos. 8,007,826; No. 8,663,685; No. 8,354,437; and No. 8,440,703 were invalid, and dismissed the cross-appeal regarding U.S. Patent No. 5,540,938, which expired while the appeal was pending, as moot. The patents all relate to improvements of the gait of persons with multiple sclerosis.

Acorda made three arguments on appeal against the determination of obviousness: First, that the district court erred in finding that a person of skill would have had a motivation to combine the prior art to arrive at the Acorda invention and a reasonable expectation of success in doing so. Second, that the district court erred in finding that the limitations relating to pharmacokinetics are inherent in the claimed invention and therefore obvious. Third, that the court improperly applied a categorical rule that a blocking patent negates any findings in favor of Acorda on the objective indicia of commercial success, failure of others, and long felt but unmet need.

Regarding the motivation to combine, Acorda argued that the prior art teaches away from the invention. The Federal Circuit, however, found that the prior art supported a motivation to combine with a reasonable expectation of success, and that the district court did not clearly err in finding that a person of skill would look to the claimed lower doses rather than higher ones.

Regarding Accorda’s arguments against the inherency of the pharmokinetic limitations, the Federal Circuit said that the court invoked the principle that an obvious formulation cannot become nonobvious simply by administering it to a patient and claiming the resulting serum concentrations, and concluded that the pharmacokinetic limitation could not alter the obviousness analysis. The Federal Circuit found that Acorda had not pointed to any evidence to contradict the district court’s assumption.

Finally, regarding the argument that the district court improperly applied a categorical rule that the existence of a blocking patent negated objective evidence of non-obviousness, the Federal Circuit explained that a blocking patent can diminish the possible rewards from a non-owner’s or non-licensee’s investment activity aimed at an invention whose commercial exploitation would be infringing, therefore reducing incentives for innovations in the blocked space by non-owners and non-licensees of the blocking patent. The Federal Circuit said that such a blocking patent can therefore be evidence that discounts the significance of evidence that nobody but the blocking patent’s owners or licensees arrived at, developed and marketed the invention covered by the later patent at issue in litigation.

The magnitude of the diminution in incentive in any context, however, and particularly if it was great enough to have actually deterred activity that otherwise would have occurred, is “a fact-specific inquiry.”

The Federal Circuit concluded that, in certain cases, a court may ultimately be left to evaluate a solid premise for diminished incentives along with some evidence (possibly weak or ambiguous) about the significance of the deterrence, together with a background sense of the general realities in the area at issue that can affect the weight to be given to the evidence in the specific case. Against this background, the Federal Circuit examined the district court’s consideration of objective indicia. The Federal Circuit found no clear error in the district court’s discounting evidence of long-felt, unmet need, in view of the evidence of blocking.