Novartis loses IPR appeal at CAFC in Torrent case

The Novartis case was an appeal by Novartis of an adverse PTAB decision
relating to US 8,324,283, with claims related to Gilenya, a disease modifying drug
for the treatment of multiple sclerosis [MS].


This is an appeal from the Final Written Decision of
the United States Patent and Trademark Office, Patent
Trial and Appeal Board (Board) in two consolidated inter
partes review (IPR) proceedings of U.S. Patent No.
8,324,283 (the ’283 patent), owned by Novartis AG and
Mistubishi Tanabe Pharma Corp. (collectively, Novartis).
The Board instituted IPRs on all claims of the ’283 patent
based on petitions filed by Torrent Pharmaceuticals
Limited, Apotex, Inc. and Mylan Pharmaceuticals Inc.
(collectively, Petitioners). After reviewing the claims,
receiving extensive briefing, and hearing oral argument,
the Board found all original claims of the ’283 patent and
Novartis’ proposed substitute claims unpatentable as
obvious. See Torrent Pharm. Ltd. v. Novartis AG, Nos.
IPR2014-00784, IPR2015-00518, 2015 WL 5719630
(PTAB Sept. 24, 2015) (Final Written Decision). Novartis
raises a series of challenges to the Board’s analysis of the
evidence and ultimate determination of unpatentability.
For the reasons stated below, we affirm.



Unlike in PTAB's decision in the Acorda/Ampyra case, "unexpected
results" did not save patentee from PTAB in this case:


The Board next turned to the objective indicia of nonobviousness.
First, it found that independent claims 1
and 19 were “not commensurate in scope” with the purported
unexpected result of fingolimod’s low concentration
stability when combined with mannitol, because the
independent claims are “not limited to any particular dose
or dose range of fingolimod.” Id. at *10. Therefore, the
Board concluded, “even if the stability of the mannitolfingolimod
combination at low doses was unexpected, it is
insufficient to support a legally significant finding of
unexpected results.” Id. at *11.



[Keep in mind, Acorda, within a month of the PTAB decision, lost
in the District Court of Delaware.]

And the CAFC noted of "unexpected results" in the Novartis case:



According to Novartis, the Board erred when it
grouped several dependent claims with their independent
claims when considering Novartis’ unexpected results
evidence. Novartis argues that it presented persuasive
evidence to the Board that the combination of fingolimod
and mannitol solved the problem of fingolimod’s unexpected
low dose instability. The Board rejected that
argument with respect to independent claims 1 and 19
because those claims contain no dosage limitation, and
therefore, the unexpected results evidence was not commensurate
in scope with the claims. Novartis does not
appeal that Board finding as it relates to claims 1 and 19.
Instead, Novartis argues that the Board should have
reassessed the unexpected results argument when it
found unpatentable dependent claims 8, 10, 22, and 23,
and proposed amended claims 40, 42, 54, and 55.3 In
Novartis’ view, these claims recite the “low dosage” limitation
lacking in claims 1 and 19.

At the outset, we note that the argument raised to the
Board below was quite different than Novartis’ characterization
of that argument on appeal. In appeals from the
Board, “we have before us a comprehensive record that
contains the arguments and evidence presented by the
parties and our review of the Board’s decision is confined
to the four corners of that record.” In re Watts, 354 F.3d
1362, 1367 (Fed. Cir. 2004) (internal quotation marks and
citation omitted). Thus, we must first determine whether
Novartis preserved this argument for appeal. While the
court “retains case-by-case discretion over whether to
apply waiver,” Harris Corp. v. Ericsson Inc., 417 F.3d
1241, 1251 (Fed. Cir. 2005) (citations omitted), we have
held that a party waives an argument that it “failed to
present to the Board” because it deprives the court of “the
benefit of the Board’s informed judgment,” Watts, 354
F.3d at 1367–68. We turn our attention to the unexpected
results argument Novartis actually presented to the
Board.

The undeniable focus of Novartis’ arguments
throughout the proceeding, including its Patent Owner’s
Response, was the patentability of the combination of
fingolimod and mannitol, as broadly recited in claim 19.
The Argument section of the Patent Owner’s Response
alerts the Board in the very first paragraph that Novartis’
arguments are directed to claim 19. What follows in the
Patent Owners’ Response is Novartis’ explanation for why
there was no ex ante reason to combine fingolimod with
mannitol or to reasonably expect success in the combination—
untethered from any specific dosage or concentration
limitation and with no discussion of any dependent
claims.

Novartis’ objective indicia argument under the heading
“Objective Indicia Prove the Fingolimod-Mannitol
Invention” is similarly generic. Novartis there contends
that the objective indicia “overwhelmingly prove the
patentability of the fingolimod-mannitol formula.” J.A.
7362. Given the reference to the fingolimod-mannitol
formula only and the failure to identify any specific claim,
this section is simply a continuation of Novartis’ defense
of claim 19. And turning to the unexpected results section
in particular, we see the entirety of Novartis’ argument in
a few short sentences:
First, mannitol unexpectedly is stable with fingolimod
throughout the full dosage range. Excipient
stability normally does not vary with dose
proportions. Drs. Kent and Kibbe each confirmed
that fact in their depositions. [Citing deposition
transcripts]. So do Dr. Byrn, Dr. Pudipeddi, and
Mr. Oomura. [Citing declarations]. Petitioners do
not address this unexpected result at all.
J.A. 7363 (emphasis added). Novartis did not identify the
dependent claims at issue now or discuss specific dosages
or concentrations at all. Nor do any of the supporting
citations. The only fair characterization of Novartis’
argument is that the combination of fingolimod and
mannitol was unexpectedly stable irrespective of concentration,
i.e., “throughout the dosage range.” Id. Novartis’
Motion to Amend likewise fails to present any separate
argument for proposed amended claims 40, 42, 54, and 55.

We thus find no fault in the Board’s observation that
Novartis offered no separate argument with respect to
dependent claims 8, 10, 22, and 23, or proposed amended
claims 40, 42, 54, and 55. The sole focus of the proceeding,
including Novartis’ unexpected results argument, was
on claim 19. Novartis even conceded at oral argument
that the focus of its unexpected results argument was
that fingolimod was unexpectedly stable across the entire
dosage range. Oral Arg. at 48:40–48:49 and 53:00–53:08,
available at
http://oralarguments.cafc.uscourts.gov/default.aspx?fl=20
16-1352.mp3. We find no evidence that Novartis distinctly
argued an unexpected result specific to the dependent
claims Novartis now raises on appeal. That argument is
therefore waived.
ii.