Two new nonobviousness cases from the Federal Circuit …

One is precedential: Takeda Chemical Indus. v. Alphapharm Pty., Ltd., No. 06-1329, slip op. (Fed. Cir. June 28, 2007).

The other is nonprecedential: Frazier v. Layne Christensen Co., No. 06-1584, slip op. (Fed. Cir. June 29, 2007).

By my count, this brings the number of post-KSR Federal Circuit cases adjudicating a nonobviousness question on the merits to five. Of course, it’s been only two months. In all but one of the cases, the claim(s) under review were held actually or (in one case) potentially invalid:

1. Syngenta (Bryson, Mayer, Schall) – Affirms a jury verdict that transgenic corn claims were invalid for obviousness
2. Leapfrog (Lourie, Mayer, Dyk) – Affirms a bench trial verdict that an interactive phonetics learning toy claim was invalid for obviousness
3. OmegaFlex (Michel, Dyk, Garbis) – Reverses a grant of summary judgment of no invalidity for obviousness in a case with a claim to a pipe fitting with a locating sleeve
4. Takeda Chemical (Lourie, Bryson, Dyk) – Affirms a bench trial verdict that a diabetes treatment compound claim was not invalid for obviousness; Judge Dyk concurs, explaining that two of the claims, in his view, are likely invalid over prior art disclosures of a broader chemical genus
5. Frazier (Bryson, Schall, Linn) – Affirms a trial judges post-verdict grant of JMOL of invalidity for obviousness in a case with a claim to a method for boosting water well flow with a gas gun burst

Also during this time, the Federal Circuit denied en banc review from its earlier decision in Pfizer v. Apotex, 480 F.3d 1348 (Fed. Cir. March 22, 2007). Judges Newman, Lourie, and Rader each dissented from the denial of en ban review in Pfizer, in an order issued on May 21.

Yesterday’s precedential decision in Takeda is the more noteworthy of these two new opinions. Judge Lourie writes for the panel, and a verdict of no invalidity is upheld. What’s more, the case is a classic chemical compound case … similar, in that respect, to the Pfizer case. Judge Lourie, who dissented from the denial of en banc review in Pfizer, distinguishes Pfizer in Takeda. Indeed, Takeda is the first post-KSR case to deal squarely with the “obvious to try” notion.

So, let’s look at a few key passages from Takeda …

Regarding the prima facie case made out by a structurally similar prior art compound:

Our case law concerning prima facie obviousness of structurally similar compounds is well-established. We have held that “structural similarity between claimed and prior art subject matter, proved by combining references or otherwise, where the prior art gives reason or motivation to make the claimed compositions, creates a prima facie case of obviousness.” [In re] Dillon, 919 F.2d [688] at 692 [(Fed. Cir. 1990)]. In addition to structural similarity between the compounds, a prima facie case of obviousness also requires a showing of “adequate support in the prior art” for the change in structure. In re Grabiak, 769 F.2d 729, 731-32 (Fed. Cir. 1985).

We elaborated on this requirement in the case of In re Deuel, 51 F.3d 1552, 1558 (Fed. Cir. 1995), where we stated that “[n]ormally a prima facie case of obviousness is based upon structural similarity, i.e., an established structural relationship between a prior art compound and the claimed compound.” That is so because close or established “[s]tructural relationships may provide the requisite motivation or suggestion to modify known compounds to obtain new compounds.” Id. A known compound may suggest its homolog, analog, or isomer because such compounds “often have similar properties and therefore chemists of ordinary skill would ordinarily contemplate making them to try to obtain compounds with improved properties.” Id. We clarified, however, that in order to find a prima facie case of unpatentability in such instances, a showing that the “prior art would have suggested making the specific molecular modifications necessary to achieve the claimed invention” was also required. Id. (citing In re Jones, 958 F.2d 347 (Fed. Cir. 1992); Dillon, 919 F.2d 688; Grabiak, 769 F.2d 729; In re Lalu, 747 F.2d 703 (Fed. Cir. 1984)).

That test for prima facie obviousness for chemical compounds is consistent with the legal principles enunciated in KSR. While the KSR Court rejected a rigid application of the teaching, suggestion, or motivation (“TSM”) test in an obviousness inquiry, the Court acknowledged the importance of identifying “a reason that would have prompted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does” in an obviousness determination. KSR, 127 S. Ct. at 1731. Moreover, the Court indicated that there is “no necessary inconsistency between the idea underlying the TSM test and the Graham analysis.” Id. As long as the test is not applied as a “rigid and mandatory” formula, that test can provide “helpful insight” to an obviousness inquiry. Id. Thus, in cases involving new chemical compounds, it remains necessary to identify some reason that would have led a chemist to modify a known compound in a particular manner to establish prima facie obviousness of a new claimed compound.

Slip op. at 9-10 (footnote omitted). In other words, no big changes in view of KSR. Is the court giving due weight here to KSR’s direction that “[a]person of ordinary skill is also a person of ordinary creativity, not an automaton”?

Regarding the recent Pfizer case:

We do not accept Alphapharm’s assertion that KSR, as well as another case recently decided by this court, Pfizer, Inc. v. Apotex, Inc., 480 F.3d 1348 (Fed. Cir. 2007), mandates reversal. Relying on KSR, Alphapharm argues that the claimed compounds would have been obvious because the prior art compound fell within “the objective reach of the claim,” and the evidence demonstrated that using the techniques of homologation and ring-walking would have been “obvious to try.” Additionally, Alphapharm argues that our holding in Pfizer, where we found obvious certain claims covering a particular acid-addition salt, directly supports its position.

We disagree. The KSR Court recognized that “[w]hen there is a design need or market pressure to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has good reason to pursue the known options within his or her technical grasp.” KSR, 127 S. Ct. at 1732. In such circumstances, “the fact that a combination was obvious to try might show that it was obvious under § 103.” Id. That is not the case here. Rather than identify predictable solutions for antidiabetic treatment, the prior art disclosed a broad selection of compounds any one of which could have been selected as a lead compound for further investigation. Significantly, the closest prior art compound (compound b, the 6-methyl) exhibited negative properties that would have directed one of ordinary skill in the art away from that compound. Thus, this case fails to present the type of situation contemplated by the Court when it stated that an invention may be deemed obvious if it was “obvious to try.” The evidence showed that it was not obvious to try.

Similarly, Alphapharm’s reliance on Pfizer fares no better. In Pfizer, we held that certain claims covering the besylate salt of amlodipine would have been obvious. The prior art included a reference, referred to as the Berge reference, that disclosed a genus of pharmaceutically acceptable anions that could be used to form pharmaceutically acceptable acid addition salts, as well as other publications that disclosed the chemical characteristics of the besylate salt. Pfizer, 480 F.3d at 1363. Noting that our conclusion was based on the “particularized facts of this case,” we found that the prior art provided “ample motivation to narrow the genus of 53 pharmaceutically-acceptable anions disclosed by Berge to a few, including benzene sulphonate.” Id. at 1363, 1367. Here, the court found nothing in the prior art to narrow the possibilities of a lead compound to compound b. In contrast, the court found that one of ordinary skill in the art would have chosen one of the many compounds disclosed in Sodha II, of which there were over ninety, that “did not disclose the existence of toxicity or side effects, and to engage in research to increase the efficacy and confirm the absence of toxicity of those compounds, rather than to choose as a starting point a compound with identified adverse effects.” Thus, Pfizer does not control this case.

Slip op. at 14-16.

Finally, from Judge Dyk’s concurrence: “In my view a species should be patentable over a genus claimed in the prior art only if unexpected results have been established.”

In short … fascinating!

UPDATE: Patent Baristas has a terrific post on the Takeda case.