Opinion ID: 4445789
Heading Depth: 2
Heading Rank: 2

Heading: Actavis’s Cross-Appeal on Obviousness

Text: After a seven-day bench trial, the district court held that Actavis did not show, by clear and convincing evidence, that claim 12 of the ’913 patent is invalid for obviousness. Actavis cross-appeals the nonobviousness determination. We review the ultimate legal conclusion about obviousness de novo and the underlying factual findings for clear error. Novo Nordisk A/S v. Caraco Pharm. Labs., Ltd., 719 F.3d 1346, 1354 (Fed. Cir. 2013). Actavis’s cross-appeal centers around the district court’s statement that claim 12 of the ’913 patent “was not a result of routine optimization of PENNSAID® 1.5% . . . because general principles and ranges of permissible concentrations would not have predicted the exact formulation and dosing frequency that resulted in PENNSAID® 2%.” J.A. 15923 (emphasis added). Actavis argues that the district court erred by requiring that the prior art predict the exact formulation of the asserted claim. To explain its obviousness theory, Actavis relied on a stereo receiver analogy drawn by its expert. Under that analogy, the various components of PENNSAID® 2% are like bass, treble, fade, and volume, among other things. Cross-Appellant Br. 69. In the analogy, the knobs of the stereo receiver correspond to various aspects of the formulation, such as the thickener that adjusts viscosity, the disclofenac sodium concentration that adjusts permeation rate/absorption, or the glycerine that adjusts drying rate. According to Actavis, if a POSITA wants to change one aspect of the formulation in a particular way, she may adjust the knobs upwards or downwards for the parameter corresponding to the desired change. 42 HZNP MEDICINES LLC v. ACTAVIS LABORATORIES UT, INC. The district court found the analogy to be inconsistent with the complexity of the art, and more specifically, with the particular components of the formulation. J.A. 15925. The district court explained that Actavis’s analogy failed to “differentiate between a system that allows independent change of one variable with little or no predictable or material effect on other variables and a system where the change to one variable must result in changes to the others.” Id. While a drug formulator could be inspired by general knowledge and the prior art to adjust a certain variable, the district court found that the variables here interacted with each other in unpredictable ways. See id. The district court credited Horizon’s expert’s (Dr. Bunge’s) testimony that the inventive formulation was complex and that a POSITA would be challenged to predict relative ratios in order to achieve the desired goal of PENNSAID® 2%. J.A. 15926–27. The district court further highlighted the unpredictability of the results by crediting Dr. Bunge’s testimony that Fick’s law 12—an established concept about drug permeation—could not predict what happens under the facts of this case, which involve a complex topical formulation that attempts to drive an active ingredient through human skin (a “formidable barrier” according to the district court’s findings). J.A. 15929–32. The district court also found that the combination of changes to the PENNSAID® 1.5% formulation were not obvious optimizations of result-effective “variables that would produce a predictable result, particularly as to the formulation’s absorption, thickness, and drying time.” 12 “Under Fick’s First Law of Diffusion, a larger concentration of the drug in the topical formulation results in a larger concentration gradient, and leads to a greater permeation—or flux—rate of the drug through the skin.” J.A. 15909. HZNP MEDICINES LLC v. ACTAVIS LABORATORIES UT, INC. 43 J.A. 15933. The district court found that the variables involved in this case, including the components of the inventive formulation, interact in an unpredictable or unexpected way, such that the results emanating into PENNSAID® 2% were not obvious. J.A. 15933–36. The district court found that nothing in the prior art allowed a POSITA to find “the schematic or roadmap to a diclofenac gel effective at two doses a day.” J.A. 15934. The district court thus held that “the combination of adjustments needed to change PENNSAID® 1.5% into PENNSAID® 2% was not predictable from the prior art.” J.A. 15933. We hold that the district court did not clearly err in its factual findings about the lack of predictability in relation to the changes made to PENNSAID® 1.5% and the teachings from the prior art. In light of the district court’s factual findings, we hold that claim 12 of the ’913 patent was nonobvious. We thus affirm the district court’s nonobviousness conclusion and its determination that PENNSAID® 2% was not the result of routine experimentation such that a POSITA would have reasonably predicted the changes made to PENNSAID® 1.5%.