Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-15-01141/USCOURTS-ca13-15-01141-0/pdf.json

Parties Involved:
LTS Lohmann Therapie-Systeme AG
Appellant
Novartis AG
Appellant
Novartis International Pharmaceutical Ltd.
Appellant
Novartis Pharma AG
Appellant
Novartis Pharmaceuticals Corporation
Appellant
Par Pharmaceutical, Inc.
Appellee

Document Text:

NOTE: This disposition is nonprecedential.

United States Court of Appeals 

for the Federal Circuit ______________________ 

NOVARTIS PHARMACEUTICALS CORPORATION, 

NOVARTIS AG, NOVARTIS PHARMA AG, 

NOVARTIS INTERNATIONAL PHARMACEUTICAL 

LTD., LTS LOHMANN THERAPIE-SYSTEME AG,

Plaintiffs-Appellees

v.

WATSON LABORATORIES, INC., WATSON 

PHARMA, INC., nka ACTAVIS PHARMA, INC., 

ACTAVIS, INC., fka WATSON PHARMACEUTICALS, INC.,

Defendants-Appellants

______________________ 

2014-1799, 2014-1800

______________________ 

Appeals from the United States District Court for the 

District of Delaware in Nos. 1:11-cv-01112-RGA, 1:13-cv00371-RGA, Judge Richard G. Andrews. 

--------------------------------------------------------------------------

NOVARTIS PHARMACEUTICALS CORPORATION, 

NOVARTIS AG, NOVARTIS PHARMA AG, 

NOVARTIS INTERNATIONAL PHARMACEUTICAL 

LTD., LTS LOHMANN THERAPIE-SYSTEME AG,

Plaintiffs-Appellants

v.

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2 NOVARTIS PHARMACEUTICALS v. WATSON LABORATORIES

PAR PHARMACEUTICAL INC.,

Defendant-Cross-Appellant

______________________ 

2015-1061, 2015-1062, 2015-1120, 2015-1121

______________________ 

Appeals from the United States District Court for the 

District of Delaware in Nos. 1:11-cv-01077-RGA, 1:13-cv01467-RGA, Judge Richard G. Andrews.

--------------------------------------------------------------------------

PAR PHARMACEUTICAL, INC.,

Plaintiff-Appellee

v.

NOVARTIS PHARMACEUTICALS CORPORATION, 

NOVARTIS AG, NOVARTIS PHARMA AG, 

NOVARTIS INTERNATIONAL PHARMACEUTICAL 

LTD., LTS LOHMANN THERAPIE-SYSTEME AG,

Defendants-Appellants

______________________ 

2015-1141

______________________ 

Appeal from the United States District Court for the 

District of Delaware in No. 1:14-cv-00843-RGA, Judge 

Richard G. Andrews.

 _____________________ 

Decided: May 21, 2015

______________________ 

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NOVARTIS PHARMACEUTICALS v. WATSON LABORATORIES 3

CHARLOTTE JACOBSEN, Fitzpatrick, Cella, Harper & 

Scinto, New York, NY, argued for plaintiffs-appellees in 

cases 2014-1799, 2014-1800. Also represented by 

CHRISTOPHER EARL LOH, NICHOLAS N. KALLAS. 

GEORGE C. LOMBARDI, Winston & Strawn, LLP, Chicago, IL, argued for defendants-appellants in cases 2014-

1799, 2014-1800. Also represented by MICHAEL KEENAN 

NUTTER; STEFFEN NATHANAEL JOHNSON, EIMERIC REIGPLESSIS, Washington, DC.

CHRISTOPHER EARL LOH, Fitzpatrick, Cella, Harper & 

Scinto, New York, NY, argued for plaintiffs-appellants in 

cases 2015-1061, 2015-1062, 2015-1120, 2015-1121; 

defendants-appellants in case 2015-1141. Also represented by CHARLOTTE JACOBSEN, NICHOLAS N. KALLAS. 

DANIEL BROWN, Latham & Watkins LLP, New York, 

NY, argued for defendant-cross appellant in cases 2015-

1061, 2015-1062, 2015-1120, 2015-1121; plaintiff-appellee 

in case 2015-1141. Also represented by GABRIEL BELL, 

ROBERT J. GAJARSA, Washington, DC; ROGER J. CHIN, San 

Francisco, CA.

______________________ 

Before LOURIE, TARANTO, and HUGHES, 

Circuit Judges.

LOURIE, Circuit Judge. 

Watson Laboratories, Inc., Watson Pharma, Inc., and 

Actavis, Inc. (collectively, “Watson”) appeal from the 

decision of the United States District Court for the District of Delaware finding the asserted claims of U.S. 

Patents 6,316,023 (“the ’023 patent”) and 6,335,031 (“the 

’031 patent”) not invalid as obvious. Novartis Pharm. 

Corp. v. Par Pharm., Inc., 48 F. Supp. 3d 733 (D. Del. 

June 18, 2014) (“Watson Trial Opinion”); 2014-1799, 

2014-1800 Joint Appendix (“J.A.1”) 1–4 (final judgment). 

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Novartis Pharmaceuticals Corp., Novartis AG, Novartis Pharma AG, Novartis International Pharmaceutical 

Ltd., and LTS Lohmann Therapie-Systeme AG (collectively, “Novartis”) appeal from the decision of the United 

States District Court for the District of Delaware finding 

the ’023 and ’031 patents not infringed by Par Pharmaceutical Inc. (“Par”)’s product, which is the subject of its 

Abbreviated New Drug Application (“ANDA”). Novartis 

Pharm. Corp. v. Par Pharm., Inc., No. 11-cv-1077, 2014 

WL 4364674 (D. Del. Aug. 29, 2014) (“Par Trial Opinion”); 

2015-1061, 2015-1062, 2015-1120, 2015-1121 Joint Appendix (“J.A.2”) 1–3, 4–6, 7–8 (final judgments). 

In view of the fact that these appeals involve the same 

patents, related issues, and the same parties in the several cases, we decide them together in one opinion. Because 

the district court did not err in concluding that the patents are not invalid, and additionally did not clearly err 

in finding the patents not infringed by Par’s ANDA product, we affirm the district court’s judgments. 

BACKGROUND

Novartis owns the ’023 and ’031 patents, which share 

a common specification. The patents are directed to

transdermal pharmaceutical formulations of rivastigmine 

for the treatment of dementia related to Alzheimer’s 

disease and Parkinson’s disease. In 2007, Novartis received approval from the United States Food and Drug 

Administration (the “FDA”) to market a transdermal 

rivastigmine patch in dosage strengths of 4.6 mg/24 hours

(“4.6 mg dose”) and 9.5 mg/24 hours (“9.5 mg dose”). In 

connection with the approved New Drug Application for 

its rivastigmine patch, Novartis listed the ’023 and ’031 

patents as claiming the drug product in the FDA’s Approved Drug Products with Therapeutic Equivalence 

Evaluations (commonly known as the “Orange Book”) for 

each dosage strength. 

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In due course, Watson and Par each submitted ANDAs, seeking approval from the FDA to market generic 

versions of Novartis’s rivastigmine patch (the “ANDA 

products”). Because Novartis at the time only had approval for the 4.6 mg and 9.5 mg doses, Par and Watson 

originally sought approval only for those two doses. Both 

ANDAs contained certifications that the patents listed in 

the Orange Book were invalid or would not be infringed

by the ANDA products. After receiving notices of those 

certifications from Watson and Par in late 2011, Novartis 

filed suit, alleging infringement of the ’023 and ’031 

patents by the 4.6 mg and 9.5 mg doses of Watson’s and 

Par’s ANDA products. 

In 2012, Novartis received FDA approval for a dosage 

strength of 13.3 mg/24 hours (“13.3 mg dose”). After the

Orange Book was updated to list the ’023 and ’031 patents 

for Novartis’s newly approved third dosage strength, Par 

and Watson amended their ANDAs to seek approval of 

that dose as well. Novartis then filed new suits in 2013, 

asserting only the ’031 patent against the 13.3 mg dose of 

Par’s and Watson’s ANDA products. Par filed suit against 

Novartis in 2014, seeking a declaratory judgment that its

13.3 mg dose also does not infringe the ’023 patent.

In its suits against Watson and Par, Novartis asserted 

claims 2 and 7 of the ’023 patent, and claims 3, 7, 13, 16, 

and 18 of the ’031 patent, which are collectively directed 

to rivastigmine pharmaceutical compositions, transdermal devices comprising such compositions, and methods 

for stabilizing such compositions. 

Claim 1 of the ’031 patent, not asserted but included 

here because claims 3, 7, and 13 depend from it, reads as 

follows:

1. A pharmaceutical composition comprising:

(a) a therapeutically effective amount of

[rivastigmine]; 

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(b) about 0.01 to about 0.5 percent by weight of an 

antioxidant, based on the weight of the composition, and

(c) a diluent or carrier.

’031 patent col. 8 ll. 14–21 (emphasis added). Claims 3 

and 13 are dependent claims that recite additional limitations relating to the antioxidant.

Claim 7 of the ’031 patent was the focus of the district 

court in the infringement analysis and reads as follows:

7. A transdermal device comprising a pharmaceutical composition as defined in claim 1, wherein 

the pharmaceutical composition is supported by 

a substrate.

Id. col. 8 ll. 49–51. Claims 2 and 7 of the ’023 patent 

similarly recite a pharmaceutical composition and a 

transdermal device, respectively, comprising rivastigmine 

and an antioxidant. ’023 patent col. 8 ll. 17–28, 43–50.

Claim 15 of the ’031 patent, also not asserted but included here because claims 16 and 18 depend from it, 

reads as follows:

15. A method of stabilizing [rivastigmine], wherein the method comprises forming a composition 

by combining [rivastigmine] with an amount of 

anti-oxidant effective to stabilize [rivastigmine] 

from degradation.

’031 patent col. 9 ll. 10–16 (emphasis added). Claims 16 

and 18 are dependent claims that recite additional limitations relating to the antioxidant.

Present in all asserted claims and important to the 

resolution of both the validity and the noninfringement

issues is the “antioxidant” claim limitation. The district 

court construed the term “antioxidant” to mean an “agent 

that reduces oxidative degradation.” J.A.1 48–50. The 

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district court then conducted separate bench trials on the

Watson and Par suits. 

I 

At the Watson trial, the district court found that Novartis had proved infringement of the asserted claims by 

Watson’s ANDA product and that Watson had not proved 

that the asserted claims were invalid. 

Watson asserted that the prior art disclosed all of the 

limitations of the ’023 and ’031 patents. The district court 

agreed that U.K. Patent Application GB 2 203 040 A (“GB 

’040”), U.S. Patent 4,948,807 (“the ’807 patent”), and 

Esther Elmalem et al., Antagonism of Morphine-Induced 

Respiratory Depression by Novel Anticholinesterase 

Agents, 30 Neuropharmacology 1059 (1991) (“the Elmalem article”) were prior art, and that collectively they 

disclosed pharmaceutical compositions comprising rivastigmine and an antioxidant. Watson Trial Opinion, 48 

F. Supp. 3d at 753. However, the court found that rivastigmine was not known to be susceptible to oxidative 

degradation at the time of the invention, and that the 

cited prior art did not teach otherwise. Id. Thus, it held, 

it would not have been obvious to add an antioxidant to a

rivastigmine composition in a transdermal device. 

Specifically, the district court first found that GB ’040 

disclosed all of the limitations of the asserted claims

except the addition of an antioxidant, and therefore it “did 

not disclose or otherwise suggest that rivastigmine, in any 

formulation, was susceptible to oxidative degradation.” 

Id. at 753–54. The court determined that one of skill in 

the art “would not have been motivated to include an 

antioxidant in any formulation unless there was evidence 

of oxidative degradation.” Id. at 754. The court found

that the compatibility of excipients like antioxidants in a 

given formulation is unpredictable without experimentation. Moreover, the court noted, there were many known 

types of degradation other than oxidation, and one of skill 

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in the art would only have been motivated to address 

known degradation problems. The court found that GB 

’040, however, was “silent” with respect to rivastigmine’s 

instability. Id.

The district court similarly found that the ’807 patent

teaches the addition of an antioxidant to rivastigmine, but 

does not teach one of skill in the art that rivastigmine is 

susceptible to oxidative degradation. Id. at 754–55. The 

court acknowledged that the ’807 patent states that 

antioxidants “can be incorporated as required.” Id. at 

755; ’807 patent col. 7 ll. 45–53. However, the court 

considered the reference as a whole and found that nothing in the ’807 patent suggests that rivastigmine requires 

an antioxidant, mentions any observed oxidative degradation of rivastigmine, or discloses any stability data. The 

court also noted that both the ’807 patent and the U.S.

counterpart of GB ’040 were considered by the patent 

examiner during prosecution of the ’023 and ’031 patents. 

The court therefore found that the ’807 patent “would not 

teach [one of skill] that an antioxidant was required to 

protect rivastigmine from oxidative degradation.” Id.

The district court further found that the Elmalem article did not teach that rivastigmine is susceptible to 

oxidative degradation. Id. at 755–57. The most arguably

relevant passage in the Elmalem article states, “All drugs 

were made up in sterile saline, which included an equal 

weight of [an antioxidant], to prevent oxidation.” Id.; 

J.A.1 1876. Watson argued that this sentence discloses 

that rivastigmine was known to be susceptible to oxidative degradation, and that an antioxidant in the same 

amount as each test compound was added for the specific 

purpose of preventing oxidation of that test compound. 

Novartis responded that because it was well-known that 

physostigmine required an antioxidant in solution, all of 

the formulations being tested included an antioxidant to 

eliminate any variability added by the antioxidant. 

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The district court admitted that there “does not appear to be an objectively ‘correct’ reading; rather both 

arguments seem logical and are supported by highly 

qualified experts in the field.” Id. at 757. Because the 

court credited Novartis’s expert testimony as being more 

credible than Watson’s and more consistent with the 

court’s reading of the article, the court consequently 

interpreted the addition of the antioxidant to the other 

test formulations as a measure to reduce variability 

rather than a teaching that rivastigmine is susceptible to 

oxidative degradation. Id. at 756–57. The court determined that Watson failed to provide clear and convincing 

evidence that the Elmalem article should be understood 

otherwise. Despite the fact that the Elmalem article thus 

discloses a formulation with rivastigmine and an antioxidant, the court decided that the article “would not have 

motivated [one of skill in the art] to combine an antioxidant with the transdermal rivastigmine device disclosed 

by GB ’040.” Id. at 756. 

Because the prior art did not teach that oxidative degradation of rivastigmine was a known problem, the district court thus found that it would not have been obvious 

to one of skill in the art to combine rivastigmine with an 

antioxidant, especially in a transdermal formulation. The 

court therefore held that Watson failed to prove obviousness by clear and convincing evidence.

II

At the Par trial, the district court found that Novartis 

did not prove that Par’s ANDA product infringes claim 7 

of the ’031 patent. Novartis contended that the acetaldehyde impurities found in the adhesive used in Par’s 

ANDA product met the claimed antioxidant limitation, 

but the court found that Novartis failed to put forth 

sufficient evidence to show that acetaldehyde is an antioxidant.

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Although the district court agreed that some reducing 

agents can act as antioxidants by undergoing sacrificial 

oxidation, and that acetaldehyde is a reducing agent and 

therefore may be an antioxidant, the court credited Par’s 

expert testimony that one of skill in the art would not 

have considered acetaldehyde to be an antioxidant, but

that acetaldehyde could instead contribute to oxidative 

degradation. Par Trial Opinion, 2014 WL 4364674 at *3–

4. The one piece of prior art that Novartis could point to 

as describing acetaldehyde as an antioxidant was a Chinese patent that Novartis produced shortly before trial, 

but the court excluded that because it found that allowing 

that into evidence would cause incurable prejudice to Par 

and would unnecessarily delay the trial.

The district court also discounted the evidence from 

testing conducted by Novartis’s expert. Id. at *4–6. 

Novartis asserted that the test data showed that a test 

rivastigmine composition (not the transdermal formulation proposed in Par’s ANDA) with acetaldehyde experienced less oxidative degradation than the composition 

without acetaldehyde. However, Par’s expert detailed, 

and the court accepted, various concerns with the testing

protocol and results that rendered the results unreliable. 

For example, Par’s expert criticized the test for not 

properly modeling the conditions of a transdermal patch, 

much less simulating Par’s ANDA product. As a result, 

the district court rejected that testing as too flawed to 

provide “usable evidence.” Id. at *7. 

Novartis’s expert also presented calculations using

three different analytical methods to support the statistical significance of the test results. However, another of 

Par’s experts found fault with those methods. She provided a statistical analysis using a fourth method, which 

produced a lower confidence interval range that indicated 

that the differences shown in Novartis’s data were not 

statistically significant. The district court accordingly

found that Novartis failed to provide sufficient expert 

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testimony as to the statistical significance of its test 

results; as a result, the district court either could not rely 

on the test or would favor Par’s expert testimony that the 

test results were inconclusive. Id. at *5.

The district court therefore found that Novartis failed 

to prove by a preponderance of the evidence that acetaldehyde is an antioxidant, and consequently failed to prove 

that Par’s ANDA product contains an antioxidant.

In the declaratory judgment action, Par filed a motion 

for summary judgment of noninfringement of the ’023 

patent by the 13.3 mg dose of its ANDA product, based on 

collateral estoppel. The district court granted that motion. 

The court accordingly entered final judgment in all of 

the cases, finding that the asserted claims are not invalid

as obvious, and that Par’s ANDA product does not infringe the ’023 and ’031 patents. Watson and Novartis 

timely appealed to this court. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).

DISCUSSION

Following a bench trial, we review a district court’s 

conclusions of law de novo and its findings of fact for clear 

error. Golden Blount, Inc. v. Robert H. Peterson Co., 365 

F.3d 1054, 1058 (Fed. Cir. 2004). A factual finding is only

clearly erroneous if, despite some supporting evidence, we 

are left with the definite and firm conviction that a mistake has been made. United States v. U.S. Gypsum Co., 

333 U.S. 364, 395 (1948); Alza Corp. v. Mylan Labs., Inc., 

464 F.3d 1286, 1289 (Fed. Cir. 2006); see also Polaroid 

Corp. v. Eastman Kodak Co., 789 F.2d 1556, 1559 (Fed.

Cir. 1986) (“The burden of overcoming the district court's 

factual findings is, as it should be, a heavy one.”). A 

district court also has broad discretion in determining 

witness credibility, and we give great deference to those 

determinations. Energy Capital Corp. v. United States, 

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12 NOVARTIS PHARMACEUTICALS v. WATSON LABORATORIES

302 F.3d 1314, 1329 (Fed. Cir. 2002); Ecolochem, Inc. v. S. 

Cal. Edison Co., 227 F.3d 1361, 1378–79 (Fed. Cir. 2000) 

(citing Anderson v. City of Bessemer City, 470 U.S. 564, 

575–76 (1985)).

This appeal raises questions of validity and infringement, but, unlike most such appeals, does not challenge 

the district court’s claim construction. As we find no 

reason to disturb the district court’s claim construction in 

these cases, we will proceed directly to the issues raised.

I 

We first address Watson’s argument that the district 

court erred by failing to hold the asserted claims of the 

’023 and ’031 patents invalid as obvious under § 103.

A patent claim is invalid for obviousness if an alleged 

infringer proves that the differences between the claimed 

subject matter and the prior art are such that “the subject 

matter as a whole would have been obvious at the time 

the invention was made to a person having ordinary skill 

in the art.” 35 U.S.C. § 103(a) (2006).* Patents are presumed to be valid, and overcoming that presumption 

requires clear and convincing evidence. 35 U.S.C. § 282; 

Microsoft Corp. v. i4i Ltd. P’ship, 564 U.S. __, 131 S. Ct. 

2238, 2242 (2011).

Obviousness is ultimately a conclusion of law premised on underlying findings of fact, including the scope 

and content of the prior art, the differences between the 

claimed invention and the prior art, and the level of 

ordinary skill in the pertinent art. KSR Int’l Co. v. Tele-

* Because the ’023 and ’031 patents were filed before the effective date of the America Invents Act, the 

earlier, pre-Act version of § 103(a) applies. See Leahy–

Smith America Invents Act, Pub. L. No. 112-29, 125 Stat. 

284, 293 (2011).

 

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flex Inc., 550 U.S. 398, 427 (2007); Graham v. John Deere 

Co., 383 U.S. 1, 17–18 (1966); Alcon Research, Ltd. v. 

Apotex Inc., 687 F.3d 1362, 1365 (Fed. Cir. 2012). “The 

presence or absence of a motivation to combine references 

in an obviousness determination is a pure question of 

fact.” Alza, 464 F.3d at 1289. 

In addition to common knowledge or teachings in the 

prior art itself, a “design need or market pressure or other 

motivation” may provide a suggestion or motivation for 

one of ordinary skill to combine prior art elements in the 

manner claimed. Rolls Royce, PLC v. United Techs. Corp., 

603 F.3d 1325, 1339 (Fed. Cir. 2010); KSR, 550 U.S. at 

420. Even an obvious solution, however, does not render 

an invention obvious if the problem solved was previously 

unknown. Mintz v. Dietz & Watson, Inc., 679 F.3d 1372, 

1377 (Fed. Cir. 2012) (“Often the inventive contribution 

lies in defining the problem in a new revelatory way.”); 

Leo Pharm. Prods., Ltd. v. Rea, 726 F.3d 1346, 1356–57 

(Fed. Cir. 2013) (finding that the claimed invention would 

not have been obvious to try to persons of ordinary skill in 

the art “because they would not have recognized the 

problem”). These principles are relevant here.

Watson argues that the combination of rivastigmine 

with an antioxidant was disclosed by or suggested in both 

the ’807 patent and the Elmalem article, and that the 

district court erred by requiring that an explicit motivation to combine be found in the prior art. More specifically, Watson contends that the district court incorrectly

required specific examples of oxidative degradation associated with rivastigmine, even though the ’807 patent 

illuminates the problem and proposes the solution. 

Watson also asserts that the Elmalem article expressly

provides that motivation by teaching that oxidative 

degradation was a known problem for rivastigmine and 

that an antioxidant was the solution to that problem. 

Watson further argues that Novartis’s interpretation of 

the Elmalem article renders the described experiment 

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unreproducible, and criticizes the district court’s decision 

to rely on an expert’s credibility instead of on scientific 

explanation to determine the appropriate interpretation 

of the prior art’s teachings.

Novartis responds that there were no disclosures in 

the prior art that taught or reasonably suggested that 

rivastigmine was susceptible to oxidative degradation. 

Novartis asserts that one of skill in the art would not 

have expected that an antioxidant was required, either 

based on rivastigmine’s chemical structure or without 

months of testing. Moreover, Novartis explains, both 

rivastigmine and the addition of an antioxidant were 

intended as solutions for the known degradation problems

with physostigmine. Because oxidative degradation was 

not a known problem for rivastigmine, Novartis contends

that the district court did not clearly err in finding that no 

motivation existed for adding an antioxidant. Novartis 

further asserts that Watson failed to show a motivation to 

combine an antioxidant with rivastigmine in a transdermal patch. 

We agree with Novartis that the district court did not 

err in concluding that Watson failed to prove that the 

asserted claims are invalid as obvious. The district court 

also did not clearly err in finding that the prior art does 

not unambiguously identify oxidative degradation to be a 

known problem with rivastigmine, and that therefore one 

of skill would not have had a reason to add an antioxidant 

to the GB ’040 transdermal formulation. 

Although the addition of an antioxidant would have

been an obvious solution for a formulation with known 

oxidation problems, here Watson failed to prove that a 

rivastigmine formulation was known to be susceptible to 

oxidative degradation. See Leo Pharm., 726 F.3d at 1356–

57 (finding that the invention was not obvious where 

stability problem not recognized or known). Without the 

knowledge of a problem, one of skill in the art would not 

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have been motivated to modify GB ’040 with antioxidants 

as purportedly disclosed in the ’807 patent or the Elmalem article. 

The references upon which Watson primarily relies 

disclose rivastigmine formulations, but only with an 

antioxidant added either conditionally (’807 patent) or 

indiscriminately across the board (Elmalem), and, moreover, not in a transdermal patch. Merely finding each of 

the claimed elements in the prior art does not prove a 

composite invention obvious, however, because “claimed

discoveries almost of necessity will be combinations of 

what, in some sense, is already known.” KSR, 550 U.S. at 

418–19.

The ’807 patent specifically states that physostigmine 

is “chemically unstable” and “must be prepared in solution with an antioxidant,” and thus one of that patent’s 

objectives was to address a need for compounds with 

“greater chemical stability” than physostigmine. ’807 

patent col. 1 ll. 30–35, col. 3 ll. 37–39. Rivastigmine (as 

the racemate) is disclosed by the ’807 patent as an alternative to physostigmine, with increased activity that may 

be due to greater chemical stability. Id. col. 11 ll. 23–29 

(noting the racemate of rivastigmine, RA7). As the district court noted, the ’807 patent nowhere discloses evidence of oxidative degradation of rivastigmine. In the 

portion that Watson points to, the specification describes 

various types of formulations, such as tablets for oral

administration and sterile solutions for parenteral administration. Id. col. 7 ll. 15–53. More specifically, the addition of buffers, preservatives, antioxidants, etc. is noted in 

the paragraph relating to sterile compositions for injection. Id. col. 7 ll. 45–50. Without prior knowledge as to

whether a compound is susceptible to oxidative degradation, the statement that excipients like antioxidants can 

be incorporated “as required” is a mere generic qualification. The district court also credited evidence that one of 

skill in the art would not have been motivated to risk 

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incompatibility by including an antioxidant in a formulation without evidence of its necessity. We thus discern no 

clear error in the district court’s finding that the ’807 

patent does not teach one of skill in the art that rivastigmine is susceptible to oxidative degradation, especially in 

a transdermal formulation. 

The plain language of the Elmalem article appears to 

present a closer question. The district court, however,

relied on the opinions of expert witnesses to provide

analysis by persons of skill in the art, from whose perspective a court must view the prior art. Although the 

district court heard from highly qualified individuals in 

the relevant field who provided reasonable support for 

both parties’ seemingly logical arguments, it found Novartis’s expert’s testimony more credible; we give great 

deference to such credibility determinations. Ecolochem, 

227 F.3d at 1378–79. 

Like the ’807 patent, the Elmalem article contrasts 

the “low chemical stability” of physostigmine with the 

“greater chemical stability” of the test compounds, including rivastigmine. J.A.1 1875. Because oxidative degradation was a well-known problem with physostigmine in 

solution, we agree that the experimental procedure in the 

Elmalem article could reasonably be understood to add an

antioxidant to the other test formulations for the purpose 

of negating an additional variable in the experiment. The 

district court thus did not clearly err in finding that the 

Elmalem article does not disclose that oxidative degradation was a known problem with rivastigmine. 

The district court considered the parties’ arguments 

and evidence, particularly their conflicting expert testimony as to how one of ordinary skill would have understood the prior art at the time of the invention. It made 

factual findings about the scope and content of the prior 

art, specifically, that rivastigmine was not known to be 

susceptible to oxidative degradation, and that the ’807 

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patent and the Elmalem article do not teach otherwise. 

The district court also found that without an appreciation 

for rivastigmine’s susceptibility to oxidative degradation, 

one of skill in the art would not have been motivated to 

patch together the prior art to add an antioxidant to a 

rivastigmine formulation, much less to a transdermal

rivastigmine formulation. We owe those findings considerable deference on appeal, and we see no clear error 

based on the record before us.

In view of the foregoing, we therefore affirm the district court’s holding that Watson failed to prove by clear 

and convincing evidence that the asserted claims of 

Novartis’s ’023 and ’031 patents are invalid as obvious.

II

We next address the district court’s holding that Par’s 

ANDA product does not infringe claim 7 of the ’031 patent. 

After a bench trial, infringement is a question of fact 

that we review for clear error. Alza, 464 F.3d at 1289. 

Under the Hatch–Waxman framework, the filing of an 

ANDA constitutes an “artificial” act of infringement for 

purposes of creating case or controversy jurisdiction. 35 

U.S.C. § 271(e)(2)(A); Eli Lilly & Co. v. Medtronic, Inc., 

496 U.S. 661, 676 (1990); Glaxo, Inc. v. Novopharm, Ltd., 

110 F.3d 1562, 1569 (Fed. Cir. 1997). Once jurisdiction is 

established, the ultimate infringement inquiry focuses on 

a comparison of the asserted patent claims against the 

ANDA product that is likely to be sold following FDA

approval, under a traditional patent law analysis. Warner-Lambert Co. v. Apotex Corp., 316 F.3d 1348, 1365–66

(Fed. Cir. 2003) (citing Glaxo, 110 F.3d at 1567–68). The

burden of proving infringement by a preponderance of the 

evidence remains on the patentee, and we have rejected 

shifting that burden to the accused infringer. Id. 

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18 NOVARTIS PHARMACEUTICALS v. WATSON LABORATORIES

Additionally, we apply the law on evidentiary rulings 

and the general collateral estoppel principles of the regional circuit in which a district court sits. Chimie v. PPG 

Indus., Inc., 402 F.3d 1371, 1376 (Fed. Cir. 2005); AbbVie 

Deutschland GmbH & Co., KG v. Janssen Biotech, Inc., 

759 F.3d 1285, 1295 (Fed. Cir. 2014) (citing Pharmacia & 

Upjohn Co. v. Mylan Pharm., Inc., 170 F.3d 1373, 1381 

n.4 (Fed. Cir. 1999)). The Third Circuit reviews a district 

court’s decision to exclude evidence for abuse of discretion, 

considering the prejudice to the other party, ability to 

cure that prejudice, extent of disruption to the trial, and 

bad faith of the proffering party. Glass v. Phila. Elec. Co., 

34 F.3d 188, 191 (3d Cir. 1994); Meyers v. Pennypack 

Woods Home Ownership Assoc., 559 F.2d 894, 904–905 

(3d Cir. 1977). Collateral estoppel applies when an identical issue was previously adjudicated, the issue was 

actually litigated, the previous determination was necessary to the decision, and the party precluded from relitigating the issue was fully represented. Jean Alexander 

Cosmetics, Inc. v. L’Oreal USA, Inc., 458 F.3d 244, 249 (3d 

Cir. 2006); see also United States v. 5 Unlabeled Boxes, 

More or Less, 572 F.3d 169, 173–74 (3d Cir. 2009) (distinguishing between res judicata and collateral estoppel). 

Novartis argues that the district court clearly erred in 

not finding infringement because the acetaldehyde present in Par’s ANDA product is an antioxidant. Novartis 

asserts that the district court erred in treating facts as 

opinions, and therefore subject to credibility determinations, rather than as objective scientific findings. Novartis emphasizes that the district court’s construction does 

not define an antioxidant according to whether it is listed 

in pharmaceutical references or recognized by experts as 

one. The court abused its discretion in excluding the 

Chinese patent, Novartis argues, because the evidence

was directly relevant to the issue of infringement and 

thus its probative value outweighed any prejudice, and 

allowing the evidence would not have been unduly disrupCase: 15-1141 Document: 48-2 Page: 18 Filed: 05/21/2015
NOVARTIS PHARMACEUTICALS v. WATSON LABORATORIES 19

tive to trial because it supported an existing argument. 

Novartis also contends that the district court misunderstood how a reducing agent acts as an antioxidant, and 

wrongly accepted Par’s expert testimony speculating,

without any evidentiary basis, that acetaldehyde would 

increase oxidative degradation. Novartis explains that 

stress tests like the one conducted by its expert are commonly used to measure oxidative degradation, and argues

that such a test can therefore be used to determine

whether a compound reduces oxidative degradation. 

Novartis maintains that its testing data and statistical

analyses prove that acetaldehyde reduces oxidative degradation of rivastigmine in oxidizing conditions and thus 

should suffice to meet its burden of proof.

Par responds that its ANDA product simply lacks an 

antioxidant, and that Novartis failed to prove that acetaldehyde is an antioxidant. Although Par’s expert did not 

conduct his own testing, Par contends that the expert’s

testimony on how acetaldehyde could instead promote 

oxidative degradation was based on published material as 

well as his own expertise in chemistry, and thus had 

sound scientific footing. Par explains that reducing 

agents are not necessarily antioxidants, and Novartis 

failed to show that acetaldehyde actually acts as an 

antioxidant. Furthermore, Par criticizes Novartis’s 

testing as lacking credibility and reliability, primarily 

because such a test had not been used before in such a 

manner and the expert failed to validate the test with 

compounds having known antioxidant characteristics. 

Par dismisses Novartis’s later statistical analyses as posthoc attempts to make the data fit a desired result. Par 

additionally asserts that, with respect to the 13.3 mg dose 

of Par’s ANDA product, Novartis is collaterally estopped 

by the decisions on the lower dose products from relitigating whether acetaldehyde is an antioxidant.

We agree with Par that the district court did not 

clearly err in finding that Novartis failed to prove that 

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20 NOVARTIS PHARMACEUTICALS v. WATSON LABORATORIES

Par’s ANDA product contains an antioxidant as required 

by the asserted claims. It appears that claim 7 of the ’031 

patent was the only claim addressed in the opinion, see, 

e.g., Par Trial Opinion, 2014 WL 4364674 at *2, but the 

antioxidant limitation is present in all of the originally 

asserted claims of the ’023 and ’031 patents. The infringement evaluation of all the asserted claims is therefore properly focused on the presence or absence of an 

antioxidant in Par’s ANDA product.

Under the district court’s claim construction, which 

we do not disturb, it does not matter how a compound 

reduces oxidative degradation, but rather that it does. 

Experts for both parties agreed that not all reducing 

agents are antioxidants; simply because a reducing agent 

can reduce oxidative degradation by undergoing sacrificial 

oxidation does not necessarily mean that it actually does 

reduce oxidative degradation. Regardless whether acetaldehyde undergoes sacrificial oxidation or acts in other 

ways, the district court found that Novartis failed to prove 

that acetaldehyde reduces oxidative degradation. The 

court furthermore did not abuse its discretion in excluding the Chinese patent, as Novartis failed to show that 

not considering the reference was prejudicial error.

Novartis bore the burden of proving that acetaldehyde 

actually reduces oxidative degradation. Both parties 

proffered expert witnesses that testified on the basis of 

both scientific knowledge and experimental evidence, and 

the district court made factual findings based on the 

credibility of those witnesses. It was well within the 

district court’s province to evaluate the validity of the 

data and the credibility of the corresponding testimony. 

The court made specific findings on the scientific soundness of Novartis’s tests and concluded that the test results 

were unpersuasive. Additionally, the court determined 

which method to use for a statistical analysis based on the 

evidence presented at trial, and found that, even assuming that the test methodology were valid, the test results 

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were not statistically significant. These are all determinations of credibility, reliability, and weight, which are

fully within the district court’s purview. Because the 

district court found Novartis’s expert’s testing to be 

unreliable, Novartis provided no basis from which to draw 

any reliable inferences as to whether acetaldehyde acts as 

an antioxidant, regardless of the amount present.

Accordingly, the district court did not clearly err in 

finding that Par’s ANDA product was not shown to infringe any asserted claim containing the antioxidant 

limitation. We find that, because the same key determination, dispositive of noninfringement, is at issue in the 

declaratory judgment action, the same conclusion must be 

arrived at there. See Jean Alexander Cosmetics, 458 F.3d 

at 249. Thus, the ruling on collateral estoppel was correct. The district court therefore did not err in granting 

final judgments of noninfringement in favor of Par for all 

three doses of its ANDA product. J.A.2 1–3, 4–6, 7–8. 

CONCLUSION

We have considered the remaining arguments and 

conclude that they are without merit. For the foregoing 

reasons, we conclude that the district court did not err in 

holding that Watson failed to prove by clear and convincing evidence that the asserted claims of the ’023 and ’031 

patents are invalid as obvious under 35 U.S.C. § 103, and 

we therefore affirm that judgment. We further conclude 

that the district court did not clearly err in finding that 

Novartis failed to prove by a preponderance of the evidence that Par’s ANDA product infringes the ’023 or ’031 

patents, and we also affirm those judgments. 

AFFIRMED

COSTS

No costs.

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