Biodelivery Scis. Int'l, Inc. v. Alvogen PB Research & Dev. LLC

576 F.Supp.3d 184

BIODELIVERY SCIENCES INTERNATIONAL, INC. and Arius Two, Inc., Plaintiffs,

v.ALVOGEN PB RESEARCH & DEVELOPMENT LLC, Alvogen Malta Operations Ltd., Alvogen Pine Brook LLC, Alvogen, Inc., and Alvogen Group, Inc., Defendants.

Civil Action No. 18-1395-CFC

United States District Court, D. Delaware.

Signed December 20, 2021

Jack Blumenfeld, Jeremy A. Tigan, MORRIS, NICHOLS, ARSHT & TUNNELL LLP, Wilmington, Delaware; Jennifer S. Swan, DECHERT LLP, Palo Alto, California; Howard W. Levine, DECHERT LLP, Washington, District of Columbia; Justin J. Hasford, Daniel G. Chung, Michael R. Galgano, Bonnie Flecther-Price, Daniele San Román; FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, LLP, Washington, District of Columbia; Charles E. Lipsey, FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, LLP, Reston, Virginia; Jeffrey D. Smyth, FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, LLP, Palo Alto, California, Counsel for Plaintiffs.

Dominick T. Gattuso, HEYMAN ENERIO GATTUSO & HIRZEL LLP, Wilmington, Delaware; Steven H. Sklar, Gregory C. Bays, David M. Airan, Ashlee B. Szelag, Wallace H. Feng, David R. Van Buskirk, James W. Sanner, Jeremy C. Lowe, LEYDIG, VOIT & MAYER, LTD., Chicago, Illinois, Counsel for Defendants.

OPINION

COLM F. CONNOLLY, CHIEF JUDGE

Table of Contents

I. THE STATUTORY AND REGULATORY FRAMEWORK ...190

II. BACKGROUND ...191

III. LEGAL STANDARDS ...192

A. Obviousness ...192

B. Anticipation ...195

IV. ANALYSIS ...195

A. Obviousness ...195

1. Definition of the Artisan of Ordinary Skill in the Art ...195

2. Obviousness of the #866 and #843 Patents ...195

a. Findings of Fact ...195

b. Conclusions of Law ...205

3. Obviousness of the #539 Patent ...207

a. Findings of Fact ...207

b. Conclusions of Law ...209

B. ANTICPATION ...210

1. Findings of Fact ...210

2. Conclusions of Law ...211

V. CONCLUSION ...211

Plaintiffs BioDelivery Sciences International, Inc and Arius Two, Inc. (collectively BDSI) have sued Defendants Alvogen PB Research & Development LLC, Alvogen Malta Operations Ltd., Alvogen Pine Brook LLC, Alvogen, Inc., and Alvogen Group, Inc. (collectively Alvogen) under the Drug Price Competition and Patent Term Restoration Act—commonly called the Hatch-Waxman Act. BDSI alleges that Alvogen's submission to the Food and Drug Administration (FDA) of an Abbreviated New Drug Application (ANDA) for approval to market a generic version of BDSI's Belbuca® drug product constitutes infringement of U.S. Patents Nos. 8,147,866 (the #866 patent, JTX-001), 9,655,843 (#843 patent, JTX-002), and 9,901,539 (the #539 patent, JTX-003) pursuant to 35 U.S.C. § 271(e)(2)(A).

BDSI assert claims 3, 4, 5, and 10 of the #866 patent; claims 8, 9, and 20 of the #843 patent; and claims 9 and 20 of the #539 patent. Alvogen stipulated to infringement of the asserted claims but argues that all asserted claims are invalid. Alvogen contends (1) that all of the asserted claims are invalid for obviousness under 35 U.S.C. § 103 and (2) that claims 3, 4, 5, and 10 of the #866 patent and claims 8 and 20 of the #843 patent are invalid for anticipation under § 102.

I held a three-day bench trial, and, as required by Federal Rule of Civil Procedure 52(a)(1), I have set forth separately below my findings of fact and conclusions of law.

I. THE STATUTORY AND REGULATORY FRAMEWORK

The ANDA procedures out of which this case arise were established by FDA regulations promulgated pursuant to the Federal Food, Drug, and Cosmetic Act (FDCA), 21 U.S.C. § 301 et seq., and specifically by the so-called Hatch-Waxman Amendments to the FDCA. Justice Kagan provided in Caraco Pharmaceutical Laboratories, Ltd. v. Novo Nordisk A/S , 566 U.S. 399, 132 S.Ct. 1670, 182 L.Ed.2d 678 (2012), this helpful summary of the provisions of the Amendments and the FDA regulations that bear on this case:

The FDA regulates the manufacture, sale, and labeling of prescription drugs under a complex statutory scheme. To begin at the beginning: When a brand manufacturer wishes to market a novel drug, it must submit a new drug application (NDA) to the FDA for approval. The NDA must include, among other things, a statement of the drug's components, scientific data showing that the drug is safe and effective, and proposed labeling describing the uses for which the drug may be marketed. The FDA may approve a brand-name drug for multiple methods of use—either to treat different conditions or to treat the same condition in different ways.

Once the FDA has approved a brand manufacturer's drug, another company may seek permission to market a generic version pursuant to legislation known as the Hatch–Waxman Amendments. Those amendments allow a generic competitor to file an abbreviated new drug application (ANDA) piggy-backing on the brand's NDA. Rather than providing independent evidence of safety and efficacy, the typical ANDA shows that the generic drug has the same active ingredients as, and is biologically equivalent to, the brand-name drug. As we have previously recognized, this process is designed to speed the introduction of low-cost generic drugs to market.

Because the FDA cannot authorize a generic drug that would infringe a patent, the timing of an ANDA's approval depends on the scope and duration of the patents covering the brand-name drug. Those patents come in different varieties. One type protects the drug compound itself. Another kind ... gives the brand manufacturer exclusive rights over a particular method of using the drug. In some circumstances, a brand manufacturer may hold such a method-of-use patent even after its patent on the drug compound has expired.

To facilitate the approval of generic drugs as soon as patents allow, the Hatch–Waxman Amendments and FDA regulations direct brand manufacturers to file information about their patents. The statute mandates that a brand submit in its NDA the patent number and the expiration date of any patent which claims the drug for which the brand submitted the NDA or which claims a method of using such drug. And the regulations issued under that statute require that, once an NDA is approved, the brand provide a description of any method-of-use patent it holds. That description is known as a use code, and the brand submits it on FDA Form 3542.... [T]he FDA does not attempt to verify the accuracy of the use codes that brand manufacturers supply. It simply publishes the codes, along with the corresponding patent numbers and expiration dates, in a fat, brightly hued volume called the Orange Book (less colorfully but more officially denominated Approved Drug Products With Therapeutic Equivalence Evaluations).

After consulting the Orange Book, a company filing an ANDA must assure the FDA that its proposed generic drug will not infringe the brand's patents. When no patents are listed in the Orange Book or all listed patents have expired (or will expire prior to the ANDA's approval), the generic manufacturer simply certifies to that effect. Otherwise, the applicant has two possible ways to obtain approval.

One option is to submit a so-called section viii statement, which asserts that the generic manufacturer will market the drug for one or more methods of use not covered by the brand's patents. A section viii statement is typically used when the brand's patent on the drug compound has expired and the brand holds patents on only some approved methods of using the drug. If the ANDA applicant follows this route, it will propose labeling for the generic drug that "carves out" from the brand's approved label the still-patented methods of use. The FDA may approve such a modified label as an exception to the usual rule that a generic drug must bear the same label as the brand-name product. FDA acceptance of the carve-out label allows the generic company to place its drug on the market (assuming the ANDA meets other requirements), but only for a subset of approved uses—i.e. , those not covered by the brand's patents.

* * * *

The generic manufacturer's second option is to file a so-called paragraph IV certification, which states that a listed patent "is invalid or will not be infringed by the manufacture, use, or sale of the generic drug." 21 U.S.C. § 355(j)(2)(A)(vii)(IV). A generic manufacturer will typically take this path in either of two situations: if it wants to market the drug for all uses, rather than carving out those still allegedly under patent; or if it discovers, as described above, that any carve-out label it is willing to adopt cannot avoid the brand's use code. Filing a paragraph IV certification means provoking litigation. The patent statute treats such a filing as itself an act of infringement, which gives the brand an immediate right to sue [under] 35 U.S.C. § 271(e)(2)(A). Assuming the brand does so, the FDA generally may not approve the ANDA until 30 months pass or the court finds the patent invalid or not infringed. Accordingly, the paragraph IV process is likely to keep the generic drug off the market for a lengthy period, but may eventually enable the generic company to market its drug for all approved uses.

566 U.S. at 404–08, 132 S.Ct. 1670 (irrelevant citations and internal quotation marks omitted).

II. BACKGROUND

Belbuca® is a bioerodable mucoadhesive (BEMA) film for transmucosal delivery of the opioid buprenorphine and is indicated for the treatment of pain. Tr. 91:13; JTX-233 at 23. Belbuca® is a dissolvable film placed on the inside of the patient's check. As the film dissolves, buprenorphine flows into the mucosa, where the drug enters the bloodstream and spreads throughout the body. Belbuca® is applied to the patient's buccal surface, i.e., the inside of the cheek. The film has two layers: (1) a mucoadhesive layer that contains the drug and that adheres to the user's buccal surface and (2) a backing layer that prevents the drug from dissolving into the oral cavity and, thus, from being swallowed. Tr. 593:16–25; JTX-233 at 23. The backing layer creates a unidirectional gradient so that buprenorphine moves from the mucoadhesive layer into the...