Chapter §10.04 Federal Circuit Examples

• Jurisdiction: United States

§10.04 Federal Circuit Examples

The Federal Circuit's treatment of the utility requirement is surprisingly inconsistent. As the decisions below illustrate, the appellate court in some cases emphasizes that utility is easily satisfied. In others, the Federal Circuit more closely hews to the Supreme Court's rigorous treatment of utility in Brenner v. Manson.³⁰

[A] Chemical Compounds

In its early years the Federal Circuit appeared to pay little attention to the Supreme Court's Manson decision. The Circuit's important 1995 decision in In re Brana³¹ did not even cite Manson. Brana appeared to lower the bar back toward the more lenient standards of utility espoused pre-Manson by the CCPA, one of the Federal Circuit's two predecessor courts.

In re Brana is a significant utility case for several reasons. First, Brana clarified the procedural burdens borne by the patent applicant and the USPTO during a utility determination. The Federal Circuit in Brana held that the agency bears the initial burden of challenging an applicant's presumptively correct assertion of utility. Only after the USPTO provides evidence showing that a person having ordinary skill in the art (a "PHOSITA") would reasonably doubt the asserted utility does the burden shift to the patent applicant to prove that utility. Such proof is typically made through submission of test data, experimental results, affidavits of experts, and the like, although it may be more qualitative in nature.

Most notably, Brana demonstrated that a biomedical invention may possess patentable utility even though it is not yet at the stage of development necessary for sales approval by the U.S. Food & Drug Administration (FDA). Applicant Brana's claims were directed to certain novel compounds intended for use in chemotherapy. Brana produced evidence before the USPTO showing that the compounds had cytotoxicity against human tumor cells, in vitro (i.e., in a test tube), and an efficacy that favorably compared to that of structurally similar prior art compounds tested in mice. Nevertheless, the USPTO rejected Brana's claims on the ground that the claimed compounds had not yet been approved by the FDA for Phase II clinical trials with human subjects.

On appeal, the Federal Circuit held that Brana's evidence satisfied the utility standard and rejected the USPTO's position.³² Patentable utility can be achieved well before FDA standards are satisfied, the court emphasized:

FDA approval . . . is not a prerequisite for finding a compound useful within the meaning of the patent laws. Usefulness in patent law, and particularly in the context of pharmaceutical inventions, necessarily includes the expectation of further research and development. The stage at which an invention in this field becomes useful is well before it is ready to be administered to humans. ³³

The Federal Circuit's Brana opinion did not cite nor even discuss the substantial utility standard previously set forth by the Supreme Court in Brenner v. Manson. This silence may have indicated the Federal Circuit's discomfort with some of the more extreme statements in the Manson majority opinion.³⁴

By 2019, however, the Federal Circuit was citing a more rigorous utility standard that required satisfaction of two prongs: "substantial" as well as "specific" utility, gleaned from the Supreme Court's 1966 language in Manson. The Circuit reviewed a relatively rare challenge to the utility of an issued (and assertedly infringed) patent in the Hatch-Waxman Act litigation, Grunenthal GMBH v. Alkem Labs. Ltd.³⁵ Grunenthal's U.S. Patent No. 7,994,364 ('364 patent) claimed the Form A polymorph (i.e., a chemical compound that can present in different three-dimensional crystalline structures) of the chemical compound tapentadol hydrochloride, asserted as useful for treating pain and/or urinary incontinence. Notably, Grunenthal had previously patented the Form B polymorph of the same drug,³⁶ but asserted that its more recently patented Form A provided better stability at room temperatures (a substantial advantage for drug manufacturing).

The Grunenthal Circuit affirmed the District of New Jersey's judgment that the '364 patent was not invalid for, inter alia, failure to comply with the utility requirement of 35 U.S.C. §101.³⁷ In so holding the Circuit followed its 2005 precedent In re Fisher to require that utility for the claimed invention be both "substantial" and "specific."³⁸ Despite application of this rigorous standard, the appellate court rejected the lack of utility challenge brought by the accused infringers. It held that both prongs of the utility requirement were satisfied as to the chemical composition claimed in Grunenthal's '364 patent.

First, the appellate court rejected accused infringer/validity challenger Hikma's contention that the invention claimed in the '364 patent lacked specific utility. In making that contention, Hikma relied on the '364 patent specification's arguably vague statement that "Crystalline Form A . . . has the same pharmacological activity as Form B but is more stable under ambient conditions. It can be advantageously used as [an] active ingredient in pharmaceutical compositions." Relying on the Circuit's decision in Fisher, Hikma argued that this disclosure failed to provide a "well-defined and particular benefit to the public."³⁹

The Circuit disposed of Hikma's argument as "without merit." The '364 patent taught that "[t]he crystalline Form A according to the invention is used for the treatment of pain or the treatment of urinary incontinence." The prior art also confirmed that tapentadol hydrochloride (of which the '364 invention is a polymorph) was known as an analgesic at the time of filing of the '364 patent. The specification statements were confirmed by expert testimony given at trial. Therefore, the Circuit concluded, "the '364 patent concretely discloses the practical benefit of Form A of tapentadol hydrochloride as an analgesic."⁴⁰

Second, the Grunenthal Circuit also rejected Hikma's contention that the claimed Form A lacked substantial utility. Hikma argued that the Grunenthal was required not only to prove the asserted superior performance of Form A over Form B at room temperature, but moreover had to prove that superiority by test data (which data were not present in the '364 patent and its prosecution history).

Rejecting Hikma's view of utility law, the Federal Circuit emphasized that showing patentable utility did not require Grunenthal to prove that Form A worked better than Form B at room temperature. Utility requires only that the invention works. It was sufficient, the Circuit held, "that Form A is shown to be stable at room temperature and useful for pain relief."⁴¹ The Grunenthal court opined that

Hikma attempts to set too high a bar for purposes of finding a sufficient disclosure of utility. While test results often support claims of utility in patents concerning pharmacological arts, such testing is not always required.[ ⁴²] . . . Nor do said results need to prove the claimed utility. E.g., Fujikawa [Fujikawa v. Wattanasin, 93 F.3d 1559 (Fed. Cir. 1996)], 93 F.3d at 1564 ("[T]est results need not absolutely prove that the compound is pharmacologically active. All that is required is that the tests be reasonably indicative of the desired [pharmacological] response." (internal quotations and citations omitted)). All that is necessary is evidence that a POSA would accept the claimed utility as correct. ⁴³

The Federal Circuit agreed with Grunenthal and the district court that the disclosure of Example 16 in the '364 patent provided sufficient evidence that a skilled artisan would have accepted Grunenthal's asserted utility as correct. That is, Example 16 was "reasonably indicative" of the stability of Form A at room temperature. Specifically, the example reported a variable temperature XRPD (x-ray powder diffraction) experiment that produced Form B from Form A at temperatures higher than room temperature (i.e., 40–50 degrees Celsius). Example 16 stated that this transition was "reversible with Form B changing over into Form A at lower temperature." Moreover, expert witness testimony at trial confirmed that Example 16 established that "Form A is stable at room temperature and Form B is stable above 50 [degrees] Celsius."⁴⁴ Lastly, sufficient evidence established that thermodynamic stability is beneficial for pharmaceutical storage and manufacturing consistency, which in turn can be beneficial characteristics for pharmaceutical compositions.

Accordingly, the Federal Circuit held the district court's finding of utility (a fact question) was not clearly erroneous, and affirmed its judgment sustaining the validity of the '364 patent.

[B] Methods of Treating Disease

The as-filed patent application on appeal in In re Brana⁴⁵ asserted that the compounds claimed therein had utility because they possessed "a better action and a better action spectrum as antitumor substances" than certain known benzo[de]isoquinolines...