Federal Circuit Affirms PTAB's IPR Decision Invalidating A Pharmaceutical Patent

Today in Merck v. Gnosis, the Federal Circuit affirmed the PTAB’s IPR Decision finding a pharmaceutical patent invalid for obviousness. Justice Newman vigorously dissented from the majority’s view (Justices Hughes and Plager) that a “substantial evidence” standard should apply to review of PTAB IPR decisions, which may encourage the patent owner to pursue a request for en banc rehearing or to seek review at the Supreme Court. The patent at issue relates to a method of lowering homocysteine levels by administering folates.

Merck, the patent owner who appealed the IPR decision, argued on appeal that several references taught away from the claimed method. The majority did not find this persuasive because other references did suggest using folates to lower homocysteine levels in their view under the “substantial evidence” standard:

“Merck fails to establish that the Board’s factual determinations are not supported by substantial evidence. In light of those findings, we agree with the Board that the prior art and expert testimony present strong evidence of obviousness.”

Merck also raised secondary considerations, including arguments that commercial success, long-felt unmet need, and licensing to others rebutted any case of obviousness. Again, however, the majority found the Board’s factual determinations were supported by “substantial evidence”:

“Although another factfinder may have reasonably evaluated Merck’s evidence of objective indicia of nonobviousness differently in the first instance, the Board’s conclusion that this evidence was not persuasively tied to the novel features of the asserted claims is supported by substantial evidence. In light of this finding, we agree with the Board that these objective indicia carry little weight.”

More specifically, the Board had found and the CAFC majority agreed that some evidence of synergism was tied to ingredients not required by the claims, so while there may have been commercial success due to an unexpected result, it did not have a proper nexus to the claimed invention:

“a Pamlab executive stated that the success of two of these products was due to the ‘unique combination’ of their ingredients. J.A. 1855–56; see also J.A. 1542 (expert stating that effectiveness of Metanx® ‘was likely due to the synergistic interactions of its components’). Thus, the Board’s finding that this evidence of commercial success should be afforded little weight was supported by substantial evidence.”

This last point is a reminder of the importance of dependent claims that closely track commercial products.