Tag: Federal Circuit

Ariosa Diagnostics, Inc. v. Sequenom, Inc. – Another Diagnostic Patent Meets its End

On Friday, June 12, 2015, the Federal Circuit issued its decision in Ariosa Diagnostics, Inc. v. Sequenom, Inc. (Fed. Cir. 2015) finding that the claims of U.S. Patent No. 6,258,540 (the ‘540 patent) did not meet the patent-eligibility requirements of 35 U.S.C. §101.

The ‘540 patent

The ‘540 patent claims certain methods of using cell-free fetal DNA (cffDNA). In 1996, the inventors, Doctors Dennis Lo and James Wainscoat, discovered cffDNA in material plasma and serum. Traditionally, this portion of maternal blood samples was discarded by researchers as medical waste. As a result, the inventors developed a method for detecting a small fraction of paternally inherited cffDNA in maternal plasma or serum to determine certain fetal characteristics, such as gender. The method was commercialized by Sequenom as the MaterniT21 test. An advantage provided by the test is that it created an alternative for prenatal diagnosis of fetal DNA that avoided the risks of widely-used techniques that took samples from the fetus or placenta.

In addition to claiming methods of using cffDNA, the ‘540 patent also provides for making a diagnosis of certain fetal characteristics based on the detection of paternally inherited cffDNA. According to the specification, a pregnant woman carrying a fetus with certain genetic defects has more cffDNA in her blood than a woman with a normal fetus.

Claims 1, 24 and 25 of the ‘540 patent recite:

1. A method for detecting a paternally inherited nucleic acid of fetal origin performed on a maternal serum or plasma sample from a pregnant female, which method comprises:

amplifying a paternally inherited nucleic acid from the serum or plasma sample, and

detecting the presence of a paternally inherited nucleic acid of fetal origin in the sample.

24. A method for detecting a paternally inherited nucleic acid on a maternal blood sample, which method comprises:

removing all or substantially all nucleated and a nucleated cell populationS from the blood sample,

amplifying a paternally inherited nucleic acid from the remaining fluid and subjecting the amplified nucleic acid to a test for the paternally inherited fetal nucleic acid.

25. A method for performing a prenatal diagnosis on a maternal blood sample, which method comprises:

obtaining a non-cellular fraction of the blood sample,

amplifying a paternally inherited nucleic acid from the non-cellular fraction,

and performing nucleic acid analysis on the amplified nucleic acid to detect paternally inherited fetal nucleic acid.

The remaining claims describe how the method of detection occurs or how it can be used. For example, claim 2, which depends from claim 1, recites amplification by polymerase chain reaction (PCR). Claim 4, which also depends from claim 1, recites detection by a sequence specific probe.

District Court Proceedings

Ariosa Diagnostics, Inc. (Ariosa) and Natera, Inc. (Natera) make and sell alternative non-invasive tests that compete with Sequenom’s MaterniT21 test. Specifically, Ariosa sells the Harmony Test, a non-invasive test used for prenatal diagnosis of certain fetal characteristics, and Natera sells the Non-Invasive Paternity Test, which is used to confirm the paternity or non-paternity of a gestating fetus from genetic information in fetal DNA available in the blood of a pregnant female.

In response to letters threatening claims of infringement, from December 2011 through early 2012, Ariosa and Natera each filed separate declaratory judgment actions against Sequenom alleging non-infringement of the ‘540 patent. Sequenom counterclaimed alleging infringement. Sequenom filed a motion seeking an preliminary injunction to enjoin Ariosa from selling the Harmony Prenatal test. In July 2012, the district court denied the motion finding that there was a substantial question over whether the subject matter of the asserted claims was directed to eligible subject matter. Sequenom appealed to the Federal Circuit.

In August 2013, the Federal Circuit vacated and remanded the case, holding that the district court erred in certain respects not relevant to this appeal. Additionally, the Court did not offer any opinion regarding the subject matter eligibility of the asserted claims.

After remand, the parties filed cross motions for summary judgment regarding invalidity under 35 U.S.C. §101. The district court found that the ‘540 patent was directed to the natural phenomenon of paternally inherited cffDNA and that the claims did not add enough to the natural phenomenon to make the claims patent eligible under §101. According to the district court, at the time of the filing of the ‘540 patent in 1997, the steps of amplifying and detecting were well-understood, routine, or conventional. Thus, the district court concluded that the ‘540 patent was not directed to patentable subject matter finding that the only “inventive concept of the processes of the ‘540 patent is to apply those well-understood, routine processes to paternally inherited cffDNA, a natural phenomenon”. Additionally, the district court also found that the claimed processes posed a risk of preempting a natural phenomenon. Sequenom appealed.

Federal Circuit Decision

The Federal Circuit began its decision by setting forth the two-prong patent-eligibility test (citing Mayo Collaborative Services v. Prometheus Laboratories, Inc. (March 2012)). The first prong is to determine whether the claims at issue are directed to a patent-ineligible concept. If answered in the affirmative, the second prong is to determine whether the elements of each claim, both individually and as an ordered combination, recite additional elements that transform the nature of the claim into a patent-eligible invention that amounts to significantly more than the ineligible concept itself.

Regarding the first prong, the Federal Circuit noted that the claims of the ‘540 patent were method claims, which generally constitute eligible subject matter. However, upon further inspection, the Court further noted that the claims were directed to a multistep method that began with cffDNA taken from a maternal plasma or serum sample. cffDNA was naturally occurring and circulated freely in the blood stream of a pregnant woman. As a result, the existence of cffDNA in maternal blood was a natural phenomena. The Court further noted that the method ended with paternally inherited cffDNA, which was also a natural phenomena. Therefore, because the method began and ended with a natural phenomenon, the Federal Circuit held that the claims were directed to naturally occurring matter. The Court stated that the specification supported its conclusion. For example, column 1, lines 50-51 states: “[i]t has now been discovered that foetal DNA is detectable in maternal serum or plasma samples”, column 13, line 11-13 states: “[t]hese observations indicate that maternal plasma/serum DNA may be a useful source of material for the non-invasive prenatal diagnosis of certain genetic disorders,” and column 16, lines 12-14 states: “[t]he most important observation in this study is the very high concentration of foetal DNA in maternal plasma and serum”.

Regarding the second prong, the Federal Circuit concluded that the practice of the method claims did not result in an inventive concept that transformed the natural phenomena of cffDNA into a patentable invention. Specifically, the Court stated that for process claims that encompass natural phenomenon, the process steps must recite additional features that are new and useful. According to the Court:

“The method at issue here amounts to a general instruction to doctors to apply routine, conventional techniques when seeking to detect cffDNA. Because the method steps were well-understood, conventional and routine, the method of detecting paternally inherited cffDNA is not new and useful. The only subject matter new and useful as of the date of the application was the discovery of the presence of cffDNA in maternal plasma or serum.”

With respect to the preparation and amplification steps, the Court noted that the specification confirmed that in 1997 that these steps were well-understood, routine, conventional activities performed by doctors. Additionally, Sequenom’s expert testified that PCR and other methodologies for amplifying DNA were well known in 1997. The Court further found that the detecting steps were also similarly well-understood, routine and conventional.

Regarding the dependent claims, the Court found that these claims were broad examples of how to detect cffDNA in maternal plasma. The Court noted that these claims were focused on the use of the natural phenomenon in combination with well-understood, routine and conventional activity.

The Court concluded stating

“Thus in this case, appending routine conventional steps to a natural phenomenon, specified at a high level of generality, is not enough to supply an inventive concept. Where claims of a method patent are directed to an application that starts and ends with a naturally occurring phenomenon, the patent fails to disclose patent eligible subject matter if the methods themselves are conventional, routine and well understood applications in the art.”

Regarding preemption, Sequenom argued that there were numerous other uses of cffDNA aside from those claimed in the ‘540 patent and as a result, the ‘540 patent did not preempt all uses of cffDNA. The Federal Circuit disagreed. The Court noted that while preemption might signal patent ineligible subject matter, the absence of complete preemption did not demonstrate patent eligibility. Specifically, in this case, the Court noted that Sequenom’s attempts to limit the breadth of the breadth of the claims by showing alternative uses of cffDNA outside the scope of the claims did not change the conclusion that the claims were directed to patent ineligible subject matter.

At the end of the opinion, the Court addressed Sequenom’s arguments that before the ‘540 patent that “no one” was using plasma or serum of pregnant mothers to amplify and detect paternally-inherited cffDNA. Moreover, Sequenom noted that the 1997 Lancet publication of the inventors had been cited over a thousand times and that the claimed method utilized the man-made tools of biotechnology in a new way that revolutionized prenatal care. The Court agreed but noted, citing to Ass’n for Molecular Pathology v. Myriad Genetics, Inc. (June 2013), that just because a discovery is groundbreaking, innovative or brilliant does not by itself satisfy §101. The Court stated:

“While Drs. Lo and Wainscoat’s discovery regarding cffDNA may have been a significant contribution to the medical field, that alone does not make it patentable. We do not disagree that detecting cffDNA in maternal plasma or serum that before was discarded as waste material is a positive and valuable contribution to science. But even such valuable and contributions can fall short of statutory patentable subject matter, as it does here”.

ARTICLE BY Lisa L. Mueller of Michael Best & Friedrich LLP

© MICHAEL BEST & FRIEDRICH LLP

Allvoice Decision Provides Roadmap For Software-based Inventions

In a refreshing break from Alice/Mayo abstract idea based 35 U.S.C. § 101 rejections, the Federal Circuit released a decision invalidating certain claims of U.S. Patent No. 5,799,273 as not being directed to one of the four statutory categories of inventions (see Allvoice Developments US, LLC, v. Microsoft Corp., CAFC 2014-1258, decided May 22, 2015) The matter was on appeal, by Allvoice, from a district court decision invalidating claims 60-68 as non-statutory subject matter. The decision also affirms a non-infringement decision by the district court, while interesting that that portion of the decision is not the focus of this post.

The claims of the ‘273 Patent at issue were directed towards a speech-recognition “interface,” see claim 60 reproduced below. Both the CAFC and the district court interpreted, probably correctly, the claimed interface as software without any tangible form (e.g., not interpreted as instructions on a computer-readable medium or as part of a tangible system).

60.  A universal speech-recognition interface that enables operative coupling of a speech-recognition engine to at least any one of a plurality of different computer-related applications, the universal speech-recognition interface comprising:

input means for receiving speech-recognition data including recognised words;

output means for outputting the recognised words into at least any one of the plurality of different computer-related applications to allow processing of the recognised words as input text; and

audio playback means for playing audio data associated with the recognised words. ’273 Patent, col. 29 ll. 22–34.

Allvoice essentially reinforces the Court’s interpretation by asserting that the claimed speech-recognition interfaces are described in the specification as “interface applications,” and thus the claims are limited to software. Allvoice attempts to clarify their position by further asserting that the claims should be interpreted as reciting “software instructions,” and further asserting that the instructions must necessarily be in a machine readable, physical state, in order to exist. It is interesting to consider whether the decision in this case might have been different if Allvoice had been able to argue an interpretation of the “means” elements as including hardware components of a system. Unfortunately, such an interpretation was either not supported by the specification, or not pursued for other reasons by the litigation team.

The Court dismisses Allvoice’s assertions regarding the implied physical form, stating “this Court has recognized, instructions, data, or information alone, absent a tangible medium, is not a manufacture.” (Citing Digitech Image Techs.,758 F.3d at 1349–50 (rejecting a patentee’s attempt to argue that the disputed claims

were subject matter eligible because the claim language did not describe “any tangible embodiment of this information (i.e., in physical memory or other medium) or claim any tangible part of the digital processing system”).) Earlier in the decision, the Court had already determined that the claims were clearly not directed to a process. Thus, because the claims were not directed to a tangible article and were not process claims, the district court’s invalidity holding was upheld.

The good news from this case is that the Court provides a fairly clear roadmap for claiming software-based inventions – software must be claimed as a process (method) or as instructions on a machine-readable medium (tangible manufacture), at least outside of a system claim. While this case does not seem to cover any “new” ground per se, it does clearly reinforce that claims directed to pure software, such as the recited speech-recognition interfaces, and not fashioned as a process or machine-readable medium are not likely to find favor in the courts.

ARTICLE BY Gregory M. Stark of Schwegman, Lundberg & Woessner, P.A.
© 2015 Schwegman, Lundberg & Woessner, P.A. All Rights Reserved.

Federal Circuit’s Sandoz Decision Increases Importance of Post-Grant Proceedings to Biosimilar Developers

Sterne Kessler Goldstein Fox

On Friday, December 5, the U.S. Court of Appeals for the Federal Circuit rendered its decision in Sandoz v. Amgen, No. 2014-1693, a case with major implications for the emerging U.S. biosimilars industry. The decision addresses when and how a party seeking to launch a biosimilar product in the U.S. can initiate litigation to challenge the brand company’s potential blocking patents. This is the first instance in which the Federal Circuit has had the opportunity to address the scope and applicability of the Biologics Price Competition and Innovation Act (BPCIA), which established a formal pathway for biosimilar approval in the US.

Background

At issue in Sandoz is a litigation Sandoz, Inc. initiated against Amgen, Inc. and Hoffman-La Roche Inc. on June 24, 2013. Sandoz’s complaint seeks a declaratory judgment (DJ) that two patents owned by Roche and exclusively licensed to Amgen are invalid, unenforceable, and would not be infringed by the commercial marketing of Sandoz’s biosimilar version of Amgen’s blockbuster biologic product Enbrel® (etanercept). The patents at issue extend Amgen’s protection around etanercept an additional 15 years past the original patents. Sandoz filed its complaint against Amgen prior to filing any application with the FDA for approval to market its biosimilar etanercept product, which is currently in Phase III clinical trials. Sandoz will not file with the FDA until the Phase III trial is complete, and of course will not be able to market its version of etanercept in the US without FDA approval. At the time of suit, Amgen had not alleged Sandoz was currently doing anything that exposes it to liability for infringing Amgen’s patents rights around Enbrel®.

The District Court Decision

Amgen moved to dismiss Sandoz’s complaint, asserting that the court lacked jurisdiction to hear the case because no immediate and real controversy between the parties exists. In a brief order, the court granted Amgen’s motion to dismiss on two separate grounds. First, the court ruled that its discretion to enter a DJ in the case is subject to the provisions of the BPCIA, which sets specific limitations on the timing and conduct of any litigation arising from the filing of an application for approval to market a biosimilar. The court concluded that “neither a reference product sponsor, such as Amgen, nor [a biosimilar applicant] such as Sandoz, may file a lawsuit unless and until they have engaged in a series of statutorily–mandated exchanges of information” related to patents potentially in dispute. In this case, Sandoz had not complied with the exchanges as it had not even started the process by filing its application with the FDA.

Second, the court found that Sandoz had not established jurisdiction under traditional grounds because it had not established a real and immediate injury or threat of future injury caused by Amgen. The court noted that Amgen had never advised Sandoz that it intended to sue Sandoz, and that the mere allegation by Sandoz that it intended to file an application for FDA approval in the future was not sufficient to create a case on controversy. Sandoz appealed the district court order dismissing the action.

The Federal Circuit Decision

On appeal, Sandoz argued that the litigation provisions of the BPCIA only govern the statutory patent infringement litigation authorized by the Act after a biosimilar application is filed with the FDA, and do not apply to DJ actions in general. Sandoz further argued that nothing in the BPCIA can be construed to bar or limit in any way the ability to bring DJ actions to resolve patent disputes prior to filing a biosimilar application. Finally, Sandoz argued that the district court erred in concluding that Sandoz had not adequately demonstrated a sufficient actual case or controversy sufficient to allow the DJ action to proceed.

The Federal Circuit panel affirmed the district court’s dismissal of Sandoz’s complaint, concluding that Sandoz had not alleged an injury of sufficient immediacy and reality to create subject matter jurisdiction. The Federal Circuit noted that “a case of actual controversy” is a prerequisite to exercising declaratory judgment jurisdiction. The test for determining whether a case or controversy exists is whether “ there is a substantial controversy . . . of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.” The Federal Circuit, however, declined to address the lower court’s interpretation of the BPCIA as barring a lawsuit by either the reference product sponsor or the biosimilar applicant unless and until the parties have engaged in the statutorily-mandated patent information exchanges.

In concluding that Sandoz’s complaint does not present a case or controversy, the Federal Circuit panel noted that there was no prior decision in which the Federal Circuit had found a case or controversy to exist when the only activity that would create exposure to potential infringement liability was a future activity requiring FDA approval that had not yet been sought. The court found the immediacy requirement lacking where the conclusion of Sandoz’s Phase III trial, which was a prerequisite for filing for FDA approval, was still several years away when Sandoz filed suit. The court refused to assume that the Phase III trial would be successful, and noted that the trial could in fact uncover issues with Sandoz’s product that could push the application filing date back even further. Alternatively, the clinical trial could fail resulting in Sandoz never seeking FDA approval, or Sandoz could modify its proposed product and file for approval on the modified product. The court also noted that Sandoz’s complaint lacked specificity as to how Amgen’s patents read or don’t read on Sandoz’s product; and instead relies on prior general assertions by Amgen that the patents at issue cover Enbrel, that Amgen will assert the patents against products that compete with Enbrel, and that Sandoz intends to market a competing product at some point in the future. Ultimately, the court concluded that the events allegedly exposing Sandoz to infringement liability may not occur as anticipated or may not occur at all. The court found that Sandoz also had not shown that it would suffer any “immediate and substantial adverse impact” from not being able to seek or secure a patent adjudication before filing its application for FDA approval.

Unanswered Questions

The Federal Circuit specifically stated that its decision was limited to the particular facts before it, and does not address whether Sandoz would be able to seek declaratory judgment jurisdiction once it files its FDA application, or whether the BPCIA forecloses declaratory judgment actions outside of the statutorily-mandated patent information exchange once the application is accepted by the FDA. The decision also did not clarify the additional issue disputed by the parties concerning what constitutes sufficient “notice of commercial marketing,” which the BPCIA states must be provided by the biosimilar applicant prior to launch.

Increased Important of Post-Grant Proceedings before the USPTO

Although the Sandoz court made a point to limit the scope of its decision to the facts before it, the decision casts substantial doubt on the ability of any biosimilar developer to bring a district court action challenging the reference product sponsor’s patents prior to filing a biosimilar application with the FDA and triggering the patent information exchange provisions of the BPCIA. At the same time, the decision elevates the importance to biosimilar developers of post-grant challenges before the U.S. Patent and Trademark Office, such as inter partes review (IPR) and post-grant review (PGR), as means for obtaining some degree of early patent certainty before initiating the FDA approval process. IPRs in particular have proven to be a potent weapon for generic drug manufacturers in the context of ANDA litigation. The lower standard of proof required to show invalidity, the expedited pace of the proceedings, and the decreased cost in comparison to district court litigation coupled with the extremely high rate in which patent claims are being invalidated provide generic manufacturers with tremendous leverage to obtain favorable settlements with brand companies. We expect that the Sandoz decision should only increase the speed with which post-grant proceedings are adopted in the biosimilar arena.

ARTICLE BY

Timothy J. Shea, Jr., PhD.
Paul A. Calvo
OF
Sterne, Kessler, Goldstein & Fox P.L.L.C.

Supreme Court Nixes "Amorphous" Federal Circuit Indefiniteness Standard

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The U.S. Supreme Court yesterday reversed long-standing Federal Circuit precedent, replacing the test used to determine whether a patent is indefinite with a new reasonable certainty standard (NAUTILUS, INC. v. BIOSIG INSTRUMENTS, INC., No. 13–369 (S. Ct. June 2, 2014).

The new reasonable certainty test raises the bar on the “clarity and precision” with whichpatents must be written. As a consequence, the burden on accused infringers attempting to invalidate patents based on ambiguous language is lowered. This new standard will prove especially helpful in the ongoing battle against patent trolls, who often wield portfolios of ambiguous or overly broad patents in an attempt to extract licensing fees. Tech companies, including Google, Inc. and Amazon.com, Inc., which are frequent targets of patent trolls, urged the Supreme Court to adopt the “reasonable certainty” standard.

The new standard will also require more precision in drafting and prosecuting patent applications. Exactly how precise language will need to be remains to be seen, but the Court explained that the old standard incentivized patent applicants and practitioners to “inject ambiguity” into their claims. The new standard was established, in part, to eliminate this incentive. The Court commented that patent practitioners are in the best position to resolve ambiguity in patent claims. In light of the Supreme Court’s admonition, patent applicants and practitioners seeking broad coverage of their inventions should use language no broader than necessary to adequately cover their inventions.

The Supreme Court’s decision stemmed from a dispute between Biosig Instruments and Nautilus, Inc. Biosig sued Nautilus for infringement of a patented heart monitor for exercise machines, which registered electrical waves to estimate a user’s heart rate. Nautilus convinced the trial court that Biosig’s patent was invalid as indefinite. Applying its “insolubly ambiguous” test, the Federal Circuit found the patent valid. Biosig sought review by the Supreme Court.

Justice Ginsberg delivered the opinion for a unanimous Court. As embodied in the Patent Act, a patent must include “one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant claims as his invention.”

This notice requirement is satisfied, the Court held, where the claims of the patent, read in light of the specification and prosecution history, informs with reasonable certainty those skilled in the art about the scope of the invention. Like any property right, the boundaries of the patent monopoly should be clear. The failure to afford the public clear notice of what is claimed, “thereby appris[ing] the public of what is still open to them,” chills innovation by creating a risk of infringement in “zones of uncertainty.”

The High Court remanded the case with instructions that the Federal Circuit should no longer employ the “insolubly ambiguous” or “amenable to construction” tests of patent claim indefiniteness under 35 USC § 112, ¶ 2. These words can “leave courts and the patent bar at sea without a reliable compass.” While noting that the Supreme Court does not “micromanage the Federal Circuit’s particular word choice” in applying patent-law doctrines, Justice Ginsberg wrote, “we must ensure that the Federal Circuit’s test is at least ‘probative of the essential inquiry.’”

The Federal Circuit test, according to the High Court, “invoked a standard more amorphous than the statutory definiteness requirement allows.” In addition to breeding lower court confusion, the discredited “insolubly ambiguous” standard tolerated “some ambiguous claims but not others….” The Court’s new reasonable certainty standard requires more definite claim language.

Article By:

David W. Harlan
Jessica M. Mendez
Patrick Coyle
Samir R. Mehta
Of:
Armstrong Teasdale

Federal Circuit Grants Patent Term Adjustment After Allowance When Continued Examination Requested

Sterne Kessler Goldstein Fox

 

On January 15, 2014, the U.S. Court of Appeals for the Federal Circuit decided Novartis v. Lee (No. 2013-1160, -1179), holding that time spent in “continued examination” is excluded from a patent term adjustment even where the continued examination occurs after the application has been pending for more than three years. However, the Federal Circuit also held that the time excluded for continued examination is limited to the time before allowance of the application, and therefore positive patent term adjustment accrues from the date the application is allowed to issuance of the patent, as long as no later examination occurs.

Patent Term Adjustment

Applicants may be entitled to patent term adjustment (PTA) to remedy certain delays caused by the U.S. Patent and Trademark Office (USPTO) during prosecution of an application. 35 U.S.C. § 154 specifies the patent term guarantees which, if not met, can serve as bases for PTA. In particular, § 154(b)(1)(B) provides one day of PTA for every day an application is pending for more than three years (known as “B delay”). According to § 154(b)(1)(B)(i), B delay does not include “any time consumed by continued examination of the application,” such as the filing of a Request for Continued Examination.

The Federal Circuit’s Decision

According to Novartis’ interpretation of the statute, applicants are entitled to PTA for any time spent by the USPTO after three years from the application filing date, even if continued examination has been requested. In contrast, the USPTO argued that the statutory language clearly excludes any time consumed by continued examination, no matter when it was initiated.

The Federal Circuit agreed with the USPTO, stating that PTA “should be calculated by determining the length of time between application and patent issuance, then subtracting any continued examination time and determining the extent to which the result exceeds three years.” The Federal Circuit also found the USPTO’s construction was otherwise supported by the statutory purpose and structure.

However, the Federal Circuit agreed with Novartis on the other statutory interpretation issue. Novartis argued that time consumed by continued examination should be limited to the time before allowance of an application, as long as no later examination actually occurred, while the USPTO argued that any time up until issuance of a patent should be excluded. The Federal Circuit rejected the USPTO’s reasoning, indicating that because a case not involving continued examination would undisputedly be entitled to the time from allowance to issuance, there was no basis for treating a case involving continued examination differently.

The following schematic illustrates the Federal Circuit’s holding:

USPTO

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Of:

Sterne, Kessler, Goldstein & Fox P.L.L.C.