• Oct 10 2019
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  • Category: CAFC Updates

The patents-at-issue generally relate to methods and compositions for topically treating osteoarthritis with a diclofenac salt and dimethyl sulfoxide and are listed in the FDA’s Orange Book for Horizon’s PENNSAID® 2% product. Actavis sought to market a generic version of PENNSAID 2% and filed an Abbreviated New Drug Application (“ANDA”) that included a certification that the patents-at-issue were invalid or would not be infringed by Actavis’s generic product. After receiving notice of Actavis’s Paragraph IV certification, Horizon filed suit alleging infringement of the patents-at-issue. After the district court’s Markman order interpreting the claims and finding most of them indefinite, and summary judgment order finding no infringement because Actavis’s label does not induce infringement, only claim 12 of the ’913 patent remained at trial. The district court found that Actavis had not shown, by clear and convincing evidence, that claim 12 of the ’913 patent is invalid for obviousness and because Actavis had stipulated to infringement of that claim if it was deemed not invalid at trial, the district court ordered that Actavis be enjoined from engaging in the commercial use, offer for sale, or sale of its ANDA product until the expiration of the ’913 patent. Horizon appeals from the District Court’s judgment of invalidity and non-infringement and Actavis cross-appeals the district court’s judgment of non-obviousness. The CAFC holds that the district court did not err in: (a) defining the basic and novel properties of the formulation patents; (b) applying the Nautilus definiteness standard to the basic and novel properties of the formulation patents; and (c) concluding that the phrase “consisting essentially of” was indefinite based on its finding that the basic and novel property of “better drying time” was indefinite on this record. With respect to inducement, the CAFC finds that because the patented method requires three distinct steps, and the instructions in Actavis’s label only require the first step, district court did not err in granting summary judgment of non-infringement in Actavis’s favor. With respect to claim 12 of the ’913 Patent, the CAFC holds that the district court did not clearly err in its factual findings about the lack of predictability in relation to the changes made to the prior art PENNSAID® 1.5% and the teachings from the prior art and holds that claim 12 of the ’913 patent was nonobvious. Accordingly, the CAFC affirms. Judge Newman concurs with the majority sustaining the validity of claim 12 of the ’913 patent and finding infringement, but dissents with respect to the holdings that the claim term “consisting essentially of” rendered the claims indefinite and that Actavis cannot be liable for induced infringement because the user might not follow the instructions on the label.

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