Source: https://www.patentdocs.org/2019/04/index.html
Timestamp: 2019-04-25 10:32:44+00:00

Document:
Last week, in United Cannabis Corp. v. Pure Hemp Collective Inc., District Judge William J. Martinez of the U.S. District Court for the District of Colorado issued an order denying a motion for partial summary judgment filed by Defendant Pure Hemp Collective Inc., finding that Pure Hemp was not entitled to summary judgment on the record. Pure Hemp had filed an Early Motion for Partial Summary Judgement, arguing that the asserted claims of U.S. Patent No. 9,730,911, which is owned by United Cannabis Corp. ("UCANN"), were invalid under 35 U.S.C. § 101 (claims 10, 12, 14, 20–22, 25, 27, 28, 31, and 33 of the '911 patent) or 35 U.S.C. § 112(e) (claim 31).
UCANN had initiated the dispute between the parties by filing a complaint against Pure Hemp for infringement of claims 10, 12, 14, 20–22, 25, 27, 28, 31, and 33 of the '911 patent. Pure Hemp responded by filing its motion for partial summary judgment, contending that all of the asserted claims were invalid.
10. A liquid cannabinoid formulation, wherein at least 95% of the total cannabinoids is cannabidiol (CBD).
20. A liquid cannabinoid formulation, wherein at least 95% of the total cannabinoids are THC [tetrahydrocannabinol] and CBD.
25. A liquid cannabinoid formulation, wherein at least 95% of the total cannabinoids are CBD, cannabinol (CBN) and THC.
31. The formulation of any one of the proceeding claims, wherein the formulation is infused in a medium chain triglyceride (MCT).
"[D]istinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of those concepts" first requires a court to "determine whether the claims at issue are directed to one of those patent-ineligible concepts." Id. at 217. If the answer is no, the inquiry ends; but if the answer is yes, a court must then determine whether the claims in question nonetheless offer "an inventive concept—i.e., an element or combination of elements that is sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself." Id. at 217–18 (internal quotation marks omitted; alterations incorporated).
[T]he proper application of the Supreme Court's Alice standard is an evolving and sometimes hazy area of law. Deciding whether a patent claim is "directed to" a law of nature is not as straightforward as the Supreme Court makes it sound in Alice itself. Moreover, the Federal Circuit itself has remarked on the difficulty, at times, of distinguishing the first Alice inquiry from the second, see, e.g., Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016); or distinguishing the two Alice inquiries (comprising a patentability analysis rooted in 35 U.S.C. § 101) from other common inquiries such as anticipation and obviousness (which are rooted in 35 U.S.C. §§ 102–03), see, e.g., Rapid Litig. Mgmt. Ltd. v. CellzDirect, Inc., 827 F.3d 1042, 1052 & n.2 (Fed. Cir. 2016).
However, after applying the Alice test to the asserted claims, Judge Martinez determined that "[d]espite the potential ambiguities [of the Alice test], the Court is convinced under the current state of the case law that the challenged claims of the 911 Patent are not directed at unpatentable subject matter." With respect to the first Alice inquiry, Pure Hemp had argued that the asserted claims are "directed to" the patent ineligible natural phenomenon of the specified chemical compounds (cannabinoids, terpenes, and flavonoids). UCANN had countered that "the claims are not directed to laws of nature or natural phenomena because they claim human-modified liquid formulations that require converting solid cannabinoids into a different state with markedly different physiological characteristics" (citation omitted).
Pure Hemp has failed to establish beyond genuine dispute that a liquefied version of cannabinoids and related chemicals at the concentrations specified in the 911 Patent is anything like a natural phenomenon. It may be true, as Pure Hemp insists, that cannabinoids in nature can take the form of a resin; that a resin can be highly viscous; that a highly viscous substance may at times be considered a liquid; and therefore it is logically possible that cannabinoids in nature might appear in a form that could, in some sense, be deemed a "liquid." . . . Even accepting as much, the 911 Patent specifies threshold concentrations of cannabinoids and related chemicals. Pure Hemp nowhere claims that these precise concentrations, or anything close to them, occur in liquid form in nature. Accordingly, UCANN's claims are not restatements of "the handiwork of nature," Funk Brothers, 333 U.S. at 131, "but [UCANN's] own [handiwork]," Chakrabarty, 447 U.S. at 310.
While noting that "the Court sees reason to question whether the 911 Patent claims anything novel, useful, or nonobvious," with respect to the Alice inquiry, the Court determined that "the 911 Patent is not 'directed to' an unpatentable law of nature, a natural phenomenon, or an abstract idea," but "is instead 'directed to' a non-naturally occurring delivery method of naturally occurring chemicals in (as far as the record reveals) non-naturally occurring proportions and concentrations." Finding that the asserted claims did not fail at step one of the Alice inquiry, the Court determined that it did not need to address step two.
As for claim 31, Pure Hemp argued that this claim was invalid for depending from a multiple dependent claim when claim 31 is itself a multiple dependent claim (i.e., claim 31 depends from "any preceding claim" -- following UCANN's correction of the claim -- and claim 9 depends from claim 1 or 5, and claim 24 depends from claim 16 or 20). Judge Martinez noted, however, that UCANN had disclaimed claim 9 and 24, and cited Guinn v. Kopf, 96 F.3d 1419, 1422 (Fed. Cir. 1996), for the proposition that "[a] statutory disclaimer under 35 U.S.C. § 253 has the effect of canceling the claims from the patent and the patent is viewed as though the disclaimed claims had never existed in the patent." While noting that "[o]ne would expect that this would end the argument as to Claim 31," the Order points out that Pure Hemp insisted in its reply brief that the Court could still declare claim 31 to be invalid for depending from multiple dependent claims, even though those multiple dependent claims are now deemed to be nonexistent. To support its argument, Pure Hemp relied on Rembrandt Wireless Technologies, LP v. Samsung Electronics Co., 853 F.3d 1370 (sFed. Cir. 2017), in which the patentee had disclaimed one of two claims in order to seek damages that would have been otherwise prohibited by a failure to mark its products. Pure Hemp argued that the same public notice concerns raised in Rembrandt Wireless undergird the requirements of 35 U.S.C. § 112(e) with respect to multiple dependencies, and therefore contended that there must be "clear public notice" of invalidity. Judge Martinez, however, noted that Pure Hemp's argument was circular, since "Claim 31 is not invalid anymore, at least not on account of the multiple dependency problem that existed before UCANN's disclaimer," finding that "there is neither a good reason nor a statutory basis to declare Claim 31 invalid, even though it previously depended on multiple dependent claims."
Rejecting both of Pure Hemp's invalidity arguments, the District Court denied Pure Hemp's Early Motion for Partial Summary Judgment.
A great deal of faith has recently been given to Congress by the patent community, spurred by efforts to solve the conundrums in patent law created by several recent Supreme Court decisions (and aided and abetted by the U.S. Patent and Trademark Office, district courts, and the Federal Circuit). Last week, Congress provided ample evidence that a degree of caution (if not a grain of salt) should arise regarding anything Congress does with the introduction by Senator Bill Cassidy (R-LA) (along with several "co-conspirators") of three bills ostensibly aimed at "solving" the problem of "excessively high" prescription drug prices. A gastroenterologist before standing for elective office, Senator Cassidy's sympathies (if not prejudices) are both evident and understandable. But as policies, they are ill conceived and unlikely to have anything more than a cosmetic effect.
If the applicant made a certification described in clause (iv) of subsection (b)(2)(A) [colloquially known as a "Paragraph IV Certification"], the approval shall be made effective immediately unless, in the case of a certification with respect to a patent that claims a drug substance (and not in the case of a certification with respect to a patent that claims a drug product or method of use for a drug, except that, in the case of a patent that claims a drug substance and a drug product or method of use, this subparagraph shall apply, but only to the extent the patent claims a drug substance), before the expiration of 45 days after the date on which the notice described in subsection (b)(3) is received, an action is brought for infringement of the patent that is the subject of the certification and for which information was submitted to the Secretary under paragraph (2) or subsection (b)(1) before the date on which the application (excluding an amendment or supplement to the application) was submitted.
(iii) If the applicant made a certification described in subclause (IV) of paragraph (2)(A)(vii), the approval shall be made effective immediately unless, in the case of a certification with respect to a patent that claims a drug substance (and not in the case of a certification with respect to a patent that claims a drug product or method of use for a drug, except that, in the case of a patent that claims a drug substance and a drug product or method of use, this clause shall apply, but only to the extent the patent claims a drug substance), before the expiration of 45 days after the date on which the notice described in paragraph (2)(B) is received, an action is brought for infringement of the patent that is the subject of the certification and for which information was submitted to the Secretary under subsection (b)(1) or (c)(2) before the date on which the application (excluding an amendment or supplement to the application), which the Secretary later determines to be substantially complete, was submitted.
If enacted into law, a patent-holding, branded drug maker would only be able to have the benefit of the 30-month stay enshrined in these provisions of the Hatch-Waxman Act for patents claiming a drug substance itself, but not formulations or methods of treatment using a patented, branded drug under an NDA. An ANDA applicant could have FDA approve its generic drug and to enter the marketplace with no further ado.
Of course, this is the classic "launch at risk" scenario, and the generic drug maker would risk not only an injunction preventing marketing of its generic drug until any patent to formulation or method of treatment has expired, but also treble damages for willful infringement. This scenario may be much less attractive to actual generic drug companies than Senator Cassidy and his co-sponsors believe it will be.
(iv) In the case of a listed drug for which the list under clause (i) includes a patent that claims the drug or a use for such drug, and where the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office has cancelled any claim of the patent relating to such drug or such use pursuant to a determination by the Patent Trial and Appeal Board in an inter partes review conducted under chapter 31 of title 35, United States Code, or a post-grant review conducted under chapter 32 of that title, and any such cancellation, if appealed, has been upheld upon appeal, the holder of the applicable approved application shall notify the Secretary of such cancellation, and the revisions required under clause (iii) shall include striking the patent from the list with respect to such drug.
This subclause shall apply even if a patent is stricken from the list under paragraph (7)(A), pursuant to the second sentence of clause (iii) of such paragraph, provided that, at the time that the first applicant submitted an application under this subsection containing a certification described in paragraph (2)(A)(vii)(IV), the patent that was the subject of such certification was included in such list with respect to the listed drug.
These revisions are cosmetic insofar as they merely bring the statute into conformity with the changes proposed for Sections 505(c)(3)(C) and 505(j)(5)(B)(iii) and thus bear little further discussion.
(i) IN GENERAL.—If the Secretary determines that a petition or a supplement to the petition was submitted with the primary purpose of delaying the approval of an application and the petition does not on its face raise valid scientific or regulatory issues, the Secretary may deny the petition at any point based on such determination. The Secretary may issue guidance to describe the factors that will be used to determine under this subparagraph whether a petition is submitted with the primary purpose of delaying the approval of an application.
(iii) PUBLIC AVAILABILITY.—The Secretary shall publish on the internet website of the Food and Drug Administration a list of any petitions that the Secretary determines were submitted for the primary purpose of delaying the approval of an application.
(J) TIMELINE FOR SUBMITTING PETITIONS.—The Secretary may establish a time period after the relevant information relied upon in a petition became known to the petitioner (or reasonably should have been known to a petitioner), as certified by the petitioner in accordance with subparagraph (H), and any petition that is submitted after such time period has passed shall be summarily denied.
The bill tracks a draft Guidance released by FDA last year representing the agency's attempt to address the perceived problem with frivolous citizen petitions. The significance and effect of such changes may depend on how much one considers branded drug makers are filing frivolous citizen petitions (or that they are having substantive effects) and whether the changes would pass constitutional muster on free speech and right to petition the Federal government for redress of grievances grounds.
(i) NO ADDITIONAL EXCLUSIVITY THROUGH DEEMING.—An approved application that is deemed to be a license for a biological product under this section pursuant to section 7002(e)(4) of the Biologics Price Competition and Innovation Act of 2009 shall not be treated as having been first licensed under subsection (a) for purposes of subparagraphs (A) and (B).
(II) the approved application for such product was deemed to be a license for a biological product as described in clause (i).
Paradoxically this bill has the highest chance of passage, according to Ryan Davis at IP Law 360 (subscription required) as being directed to insulin, which has been licensed under the FDCA since the 1930's but is slated to come under the auspices of the BPCIA in 2020. According to Mr. Davis, this bill is intended to prevent this change from bestowing on a biologic drug-classified insulins a 12-year exclusivity under the BPCIA. As with the Timely Act, the effect enactment of this bill into law would have depends on the magnitude of the problem that prompted its introduction.
As has been said in other contexts, political posturing is in vogue and particularly posturing regarding prescription drug prices. It is unclear whether any of these proposed changes in the law will remedy any real problems that underlie high drug prices. Bills like these only address part of those problems but at the cost of addressing systemic issues with drug pricing not as amenable to quick or simple changes in existing law.
April 25, 2019 - "IPR Estoppel One Year After SAS" (Intellectual Property Owners Association) - 2:00 to 3:00 pm (ET).
Those wishing to attend the meeting can register here. The USPTO notes that registrations will be honored on a first-come, first-served basis according to the time and date of receipt of each request, but that in order to ensure a broad cross-section of attendees, the USPTO reserves the right to limit the number of attendees from any single organization or law firm, and therefore, organizations and law firms must designate their official representatives. Additional information regarding the customer partnership meeting can be found here.
• The pending Federal Circuit appeal in BTG International Ltd. v. Amneal Pharmaceuticals LLC and whether the America Invents Act stops patent challengers who won at the PTAB from pursuing their winning arguments in court.
D Young & Co will be offering its next European biotech patent law update on April 30, 2019. The webinar will be offered at three times: 4:00 am, 7:00 am, and 12:00 pm (EDT). D Young & Co European Patent Attorneys Simon O'Brien and Matthew Caines will provide an essential update and live Q&A on EPO biotechnology case law.
• What key information does counsel need to determine inventorship?
• What are the steps for counsel when inventorship must be corrected?
• What is the AIA's impact on an inventorship determination?
• What guidance can be drawn from recent court decisions for claim construction?
• What pitfalls to avoid do the cases identify?
• What best practices can practitioners use for claim construction of varying scope as applied now under the same standard in the district courts and PTAB post-grant proceedings?

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