UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_____________________
`
`ROXANE LABORATORIES, INC. and PAR PHARMACEUTICAL, INC.
`Petitioners
`
`v.
`
`JAZZ PHARMACEUTICALS, INC.
`Patent Owner
`
`_____________________
`
`Case CBM: Unassigned
`_____________________
`
`PETITION FOR COVERED BUSINESS METHOD PATENT REVIEW OF
`U.S. PATENT NO. 7,765,107 UNDER 35 U.S.C. § 321 AND § 18 OF THE
`LEAHY-SMITH AMERICA INVENTS ACT
`
`Mail Stop “PATENT BOARD”
`Patent Trial and Appeal Board
`U.S. Patent and Trademark Office
`P.O. Box 1450
`Alexandria, VA 22313-1450
`
`

`

`TABLE OF CONTENTS
`
`I.
`
`II.
`
`B.
`
`INTRODUCTION AND STATEMENT OF RELIEF REQUESTED
`(37 C.F.R. § 42.22(a)).................................................................................1
`OVERVIEW...............................................................................................1
`A.
`Background.......................................................................................3
`B.
`The ‘107 patent.................................................................................7
`C.
`Summary of Argument ...................................................................10
`III. GROUNDS FOR STANDING (37 C.F.R. § 42.104(a))............................11
`A.
`Roxane and Par have standing and are not estopped (37 C.F.R. §
`42.302)............................................................................................11
`The ‘107 patent is directed to a covered business method. ..............12
`1.
`The Patent Claims Cover a “Financial Product or Service”...12
`2.
`The Patent Does Not Claim a “Technological Invention” .....16
`a)
`The claimed subject matter does not contain any
`novel or unobvious technological features ..................18
`The claims do not address any technical problem
`using any kind of a technical solution .........................21
`IV. Claim Construction...................................................................................23
`A.
`“Exclusive Central Pharmacy”........................................................24
`B.
`“Periodic reports generated” ...........................................................24
`EACH OF THE REFERENCES CITED IS AVAILABLE PRIOR
`ART..........................................................................................................24
`A.
`The ACA (ROX1003–ROX1006) qualifies as a “printed
`publication” ....................................................................................25
`PERSON OF SKILL IN THE ART (“POSA”) & STATE OF THE
`ART..........................................................................................................29
`IDENTIFICATION OF CHALLENGE ....................................................31
`A.
`Ground 1: Claims 1-6 are more likely than not unpatentable
`under 35 U.S.C. § 101 because they recite mere abstract ideas .......32
`1.
`Claims 1-6 are not statutory subject matter under § 101,
`because they recite mere abstract ideas. ................................32
`
`VII.
`
`b)
`
`V.
`
`VI.
`
`-i-
`
`

`

`2.
`
`3.
`
`B.
`
`The Method Claims Only Reference General-Purpose
`Computer Components .........................................................38
`The Method Claims Do Not
`Include Meaningful
`Limitations Beyond the Abstract Idea Itself ..........................41
`Ground 2: Claims 1-6 are anticipated by the ACA..........................45
`1.
`Claim 1 .................................................................................47
`2.
`Claims 2 and 5 ......................................................................65
`3.
`Claims 3 and 6 ......................................................................67
`4.
`Claim 4 .................................................................................67
`Ground 3: Claims 1-6 would have been obvious over the ACA ......68
`C.
`Secondary considerations do not rebut the prima facie case............73
`D.
`VIII. PETITIONER WILL MORE LIKELY THAN NOT PREVAIL WITH
`RESPECT TO AT LEAST ONE CHALLENGED CLAIM .....................78
`IX. MANDATORY NOTICES (37 C.F.R. § 42.8(a)(1)).................................78
`X.
`CONCLUSION ........................................................................................79
`
`-ii-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`I.
`
`INTRODUCTION AND STATEMENT OF RELIEF REQUESTED (37
`C.F.R. § 42.22(a))
`
`Roxane Laboratories,
`
`Inc. and Par Pharmaceutical,
`
`Inc.
`
`(collectively,
`
`“Petitioners”) petition for covered business method patent (“CBM”) review and
`
`seek cancellation of claims 1-6 of U.S. Patent No. 7,765,107 (“the ‘107 patent”)
`
`(ROX1001). According to Office records, the ‘107 patent is assigned to Jazz
`
`Pharmaceuticals, Inc. (“Jazz”). Jazz is currently asserting the ‘107 patent against
`
`Petitioners in litigation. (ROX1024-ROX1025.)
`
`II.
`
`OVERVIEW
`
`Claims 1-6 of the ‘107 patent are unpatentable because they: (i) claim
`
`ineligible subject matter under 35 U.S.C. § 101; (ii) are anticipated by the prior art
`
`under 35 U.S.C. § 102(b); and (iii) are obvious over the prior art under 35 U.S.C.
`
`§ 103, even in view of secondary considerations of nonobviousness.
`
`Because the compound sodium oxybate has been known at least since the
`
`1970s, and is not the subject of patent protection, Jazz has sought to patent a broad
`
`and abstract method of distributing the drug. The challenged claims simply claim
`
`the abstract idea of centralizing retail drug distribution using an exclusive central
`
`pharmacy that encompasses the non-technical steps of interfacing with financial
`
`businesses (patient’s insurance company), rendering them incidental to a financial
`
`product or service. The claim preambles reciting a method for controlling abuse of
`
`a prescription drug does not change their abstract nature. All claim steps are
`
`-1-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`directed to non-technical drug distribution steps and define a complete method.
`
`The preambles do not change the claims’ basic characteristic of covering the
`
`abstract idea of centralizing drug distribution.
`
`Further, the claims are not directed to any technological invention. The
`
`claims’ recitation of a generic computer processor and central database do not
`
`change this conclusion. Moreover, the claimed distribution methods are not novel
`
`or nonobvious and do not solve a technological problem with any technological
`
`solution. CBM review is, therefore, appropriate.
`
`By law, no patent should issue if it claims: “A prior art method X,” which is
`
`simply an abstract idea, and nothing more. Yet, the ‘107 patent claims are just that.
`
`The claims are drawn to abstract ideas, nothing more than artfully drafted to
`
`monopolize the abstract idea itself, as warned against in Mayo Collaborative Servs.
`
`v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1297 (2012). Challenged claims 1-6
`
`claim the abstract idea of centralizing distribution of abuse-prone drugs to reduce
`
`their associated risks without any meaningful limitations. The claimed steps can be
`
`performed by a human intermediary with no computer operation. (ROX1007, ¶¶
`
`46-47.)
`
`The challenged claims are also unpatentable as anticipated by and obvious in
`
`view of the relevant prior art. Published materials that were used in an FDA
`
`Advisory Committee Meeting (the “Advisory Committee Art” or the “ACA”)
`
`-2-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`(ROX1003-1006) disclose every limitation of the challenged claims more than a
`
`year before the ‘107 patent’s earliest effective filing date. Accordingly,
`
`the
`
`challenged claims are anticipated. Alternatively, the challenged claims would also
`
`have been obvious to a person of ordinary skill in the art (“POSA”) over the same
`
`art, even in view of any available objective indicia of nonobviousness.
`
`The grounds raised in this petition demonstrate that it is more likely than not
`
`that Petitioners will prevail with respect to at least one of the challenged claims,
`
`and CBM review of the ‘107 patent is warranted. To find otherwise, and maintain
`
`the ‘107 patent, would allow for patenting of an abstract idea, and would withdraw
`
`that which was in the public domain. The Board should institute CBM review and
`
`cancel each of challenged claims 1-6 of the ‘107 patent.
`
`A.
`
`Background
`
`The ‘107 patent generally pertains to centralizing abuse-prone drug
`
`distribution. The ‘107 patent
`
`is listed in the United States Food and Drug
`
`Administration’s electronic publication known as the “Orange Book” (“OB”) in
`
`connection with the prescription drug Xyrem®. The active ingredient
`
`in
`
`Xyrem®—sodium oxybate (GHB)—was well-known in the prior art as being
`
`susceptible to diversion and abuse. (ROX1007, ¶46.) So, as a prerequisite to FDA
`
`approval,
`
`the Xyrem® sponsor, with assistance and direction from an FDA
`
`advisory committee, agreed to employ a centralized distribution program to thwart
`
`-3-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`illicit uses of Xyrem® (“the Xyrem® Success Program”). Jazz’s listing of the ‘107
`
`patent in the FDA’s OB for Xyrem® is an assertion that the Xyrem® Success
`
`Program is an embodiment of at least one ‘107 patent claim. The ACA materials
`
`were used in the FDA advisory committee meetings held as a prerequisite to
`
`approving the Xyrem® New Drug Application (“NDA”). The ACA prior art
`
`discloses each and every limitation of the challenged claims.
`
`In addition to the ACA, the prior art taught mitigating distribution risks
`
`associated with other potentially hazardous drugs. In 1982, Hoffmann-La Roche
`
`(“Roche”) gained approval for Accutane® (isotretinoin), which became known to
`
`be a potent
`
`teratogen responsible for birth defects. (ROX1007, ¶23.) Under
`
`pressure to respond, Roche developed a Pregnancy Prevention Program for
`
`Accutane®, including patient and prescriber informed consent forms, and patient
`
`counseling on the Accutane® teratogenic risk, the need to avoid pregnancy, and
`
`proper birth control methods. (Id.) The program also required that women of
`
`childbearing potential test negative for pregnancy before treatment. (Id.)
`
`Following Accutane®, in 1990, Clozaril® (clozapine) entered the United
`
`States market for use with treatment-resistant schizophrenia. (ROX1007, ¶24.)
`
`However, Clozaril® use was associated with agranulocytosis. (Id.) To mitigate
`
`these risks and control distribution of Clozaril®, the manufacturer implemented a
`
`national registry system to limit the drug’s distribution. (Id.) The system required
`
`-4-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`registration in an integrated computerized database—collecting information
`
`identifying the patient and the physician—and measuring the patient’s white blood
`
`cell count before prescription filling. (Id.) If a patient or physician was non-
`
`compliant, the national registry took corrective action, such as contacting and re-
`
`educating the prescribing physician and/or discontinuing supplying of
`
`the
`
`prescription to the patient. (Id.) Overall, the Clozaril® distribution system resulted
`
`in 97% patient/physician compliance over its first five years of implementation.
`
`(Id.) While computer use differentiated the Clozaril® system from the Accutane®
`
`system, computer use was not novel to prescription drug distribution. By 1990,
`
`pharmacies had long used computers to aid in filling prescriptions. (Id, ¶25.)
`
`Based on the Accutane® and Clozaril® experiences,
`
`in 1999,
`
`the
`
`prescription thalidomide manufacturers—a known teratogen—developed a hybrid
`
`controlled distribution system, combining the Clozaril® computerized registry
`
`system with the Accutane® pregnancy monitoring/prevention, and informed
`
`consent requirements. (Id., ¶26.)
`
`Thus, by 1999,
`
`the industry had implemented at
`
`least
`
`three restricted
`
`distribution systems for effective, yet hazardous, prescription drugs. Moreover,
`
`while risk management programs were developing during the 1980s-90s,
`
`pharmacies had been making use of computerized distribution systems for
`
`controlled substances, i.e., drugs with potential for abuse. (Id., ¶¶27-28.) Aiming to
`
`-5-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`reduce dispensing time,
`
`improve accuracy and accountability, and streamline
`
`recordkeeping, controlled substance distribution veered toward automation via
`
`computerized distribution systems. (Id., ¶28.) Computerized systems were helpful
`
`in generating reports tracking patients who were receiving excessive supplies of
`
`controlled substances. (Id.) Controlled substance distribution could be tied to
`
`information identifying the patient, prescribing doctor, quantity of the drug
`
`dispensed, and hospital drug inventory. (Id.) The systems could be queried to
`
`provide data, such as, prescriptions by doctor and patient and could allow for
`
`detecting patterns of abuse, controlling abuse and delivering medication to the
`
`patients. (Id.)
`
`Given the proclivity for diversion and abuse of GHB, the FDA held an
`
`advisory committee meeting as a prerequisite to approving the Xyrem® NDA. The
`
`ACA used in that meeting was published more than one year prior to the earliest
`
`effective filing date of the ‘107 patent and disclose each and every limitation of the
`
`challenged claims.
`
`Consequently, prior art existed that would have led a POSA to develop the
`
`centralized distribution methods claimed in the ‘107 patent to minimize the risks
`
`associated with the distribution of hazardous, but
`
`therapeutically beneficial,
`
`prescription drugs and control prescription drug abuse. (Id., ¶29.)
`
`-6-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`B.
`
`The ‘107 patent
`
`Against this backdrop, Jazz obtained the ‘107 patent, which relates to a
`
`“drug distribution system and method [that] utilizes a central pharmacy and
`
`database to track all prescriptions for a sensitive drug.” (ROX1001, Abstract.)
`
`According to the ‘107 specification, multiple controls are imposed on the
`
`prescription drug distribution. (Id., 1:55-58.) Physician and patient prescription
`
`patterns are monitored for abuse using an exclusive central database. Physician
`
`eligibility to prescribe the drug is verified via a database, including determining
`
`whether disciplinary actions have been brought against the physician. (Id., 1:48-
`
`56.) Prior to shipping the prescription drug, the central pharmacy confirms whether
`
`the patient has been educated, and only ships when no abuse is found related to the
`
`patient and prescribing doctor. (Id., 1:59-67.) The prescription drug is then
`
`delivered to the patient. (Id., 1:59-67, 2:1-3.)
`
`The ‘107 patent claims are directed to a method of distributing a prescription
`
`drug using an exclusive central pharmacy that comprises: (1) controlling with a
`
`computer processor the distribution of said prescription drug via an exclusive
`
`central pharmacy that maintains a central database that tracks all prescriptions of
`
`said prescription drug and analyzes for potential abuse situations; (2) receiving in
`
`the computer processor all prescription requests, for any and all patients being
`
`prescribed the prescription drug, only at the exclusive central pharmacy, from any
`
`-7-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`and all medical doctors allowed to prescribe the prescription drug; (3) processing
`
`with the computer processor all prescriptions for the prescription drug only by the
`
`exclusive central pharmacy using only the central database; (4) determining with
`
`the computer processor current and anticipated patterns of potential prescription
`
`abuse of said prescription drug from periodic reports generated only by the central
`
`database based on prescription request data from a particular medical doctor and
`
`further based on filling of prescriptions by a particular patient, wherein said request
`
`data contain information identifying the patient,
`
`the drug prescribed, and
`
`credentials of the medical doctor; (5) selecting with the computer processor
`
`multiple controls for distribution by said exclusive central pharmacy (See claims 1
`
`and 4 for list of controls).
`
`The applicants acknowledge that GHB was well-known for use in treating
`
`narcolepsy and daytime cataplexy in the ‘107 patent background, stating “[c]ertain
`
`agents, such as gamma hydroxy butyrate (GHB) are also abused, yet also are
`
`effective for therapeutic purposes such as treatment of daytime cataplexy in
`
`patients with narcolepsy.” (ROX1001, ‘107 patent, col. 7, ll. 27-31.)
`
`During prosecution of the ‘107 patent’s parent application, the independent
`
`claims were amended to add the following limitations to overcome prior art
`
`rejections: (1) “all prescriptions for the sensitive drug are processed only by the
`
`exclusive central pharmacy using only the exclusive computer database;” and (2)
`
`-8-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`“mailing the sensitive drug to the patient only if no potential abuse is found by the
`
`patient to whom the sensitive drug is prescribed and the doctor prescribing the
`
`sensitive drug.” (ROX1016, 241-248, 8/8/06 Amdt; 303-334, 7/18/07 Appeal
`
`Brief; 442, 11/2/09 Amdt) Applicants argued that the prior art did not teach these
`
`limitations. (ROX1016, 449, 11/2/09 Amdt) Applicants also argued that “checking
`
`the exclusive computer database for potential abuse of the sensitive drug” was not
`
`taught in the prior art. (Id.) The cited art was found to teach all other claim
`
`limitations. (Id., at 258-262, Final Rejection, Oct. 18, 2006; and at 420-433,
`
`Decision on Appeal, Aug. 31, 2009.)
`
`Subsequently,
`
`in the Notice of Allowance for the ‘107 patent’s parent
`
`application, the Examiner relied on the same limitations, stating: “the closest prior
`
`art of record does not teach or fairly suggest that all prescriptions for GHB are
`
`processed only by the exclusive central pharmacy using only the exclusive
`
`computer database. The exclusive computer database is checked for potential GHB
`
`abuse and GHB is provided/mailed only if no potential abuse is found by the
`
`patient to whom GHB is prescribed and the doctor/authorized prescriber of the
`
`GHB.” (Id., at 475-476, Notice of Allowance, p. 11.) The ‘107 patent claims rely
`
`on similar limitations for patentability. In the ‘107 patent’s Notice of Allowance,
`
`the Examiner stated that “the closest prior art of record does not teach or fairly
`
`suggest receiving in the computer processor all prescription requests, for any and
`
`-9-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`all patients being prescribed the prescription drug, only at the exclusive central
`
`pharmacy, from any and all medical doctors allowed to prescribe the prescription
`
`drug and processing with the computer processor all prescriptions for
`
`the
`
`prescription drug only by the exclusive central pharmacy using only the central
`
`database.” (ROX1002, Allowable Subject Matter section of
`
`the Notice of
`
`Allowance dated March 10, 2010.)
`
`However, as this petition demonstrates, none of these alleged “novel”
`
`limitations were novel. Using the claimed “exclusive central pharmacy”,
`
`“computer processor,” and “central database” were well-known in the prior art.
`
`(See § VII.B.1.)
`
`C.
`
`Summary of Argument
`
`Petitioners, individually and collectively, have standing to seek CBM review
`
`of the ‘107 patent, and the ‘107 patent is eligible for CBM review. Supported by
`
`the Declaration of Dr. Robert Valuck, Ph.D., R.Ph. (“Valuck Dec.”) (ROX1007),
`
`an expert in the fields of drug safety, drug abuse prevention, and prescription drug
`
`distribution, this petition asserts three different grounds of unpatentability: Claims
`
`1-6 are (1) unpatentable under 35 U.S.C. § 101 because they recite mere abstract
`
`ideas; (2) anticipated by the ACA; and (3) obvious over the ACA. In support of
`
`these grounds, this petition proposes terms for construction, identifies each prior
`
`art reference relied upon, and provides required mandatory notices.
`
`-10-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`III. GROUNDS FOR STANDING (37 C.F.R. § 42.104(a))
`
`The undersigned, Roxane and Par certify that the ‘107 patent is available for
`
`post-grant review as a covered business method patent under § 18 of the Leahy–
`
`Smith America Invents Act (“AIA”). AIA, § 18(a)(1)(A). The AIA defines a
`
`covered business method patent as claiming a method or corresponding apparatus
`
`for performing data processing or other operations used in the practice,
`
`administration, or management of a financial product or service, except for patents
`
`for technological inventions. AIA § 18(d)(1). Because the ‘107 patent satisfies
`
`these requirements, it is eligible for CBM post-grant review.
`
`A.
`
`Roxane and Par have standing and are not estopped (37 C.F.R. §
`42.302)
`
`Roxane and Par are eligible to make this petition. “A petitioner may not file
`
`… a petition to institute a covered business method patent review of the patent …
`
`unless the petitioner … has been sued for infringement of the patent or has been
`
`charged with infringement under that patent.” 37 C.F.R. § 42.302(a). Patent Owner
`
`Jazz sued each of Roxane and Par in the District of New Jersey, accusing them of
`
`infringing claims 1-6 of the ‘107 patent. Thus, Roxane and Par have standing to
`
`file this petition under 37 C.F.R. § 42.302(a). Also, Petitioners are not estopped
`
`because neither Roxane nor Par have been party to any other decided post-grant or
`
`inter partes review of the challenged ‘107 patent claims under 37 C.F.R.
`
`§42.302(b).
`
`-11-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`B.
`
`The ‘107 patent is directed to a covered business method.
`
`The AIA defines a CBM patent as “a patent that claims a method or
`
`corresponding apparatus for performing data processing or other operations used in
`
`the practice, administration, or management of a financial product or service….”
`
`See AIA § 18(d)(1); see also 37 C.F.R. § 42.301. As the Office has recognized, the
`
`AIA’s legislative history establishes that “financial product or service” should be
`
`“interpreted broadly,” encompassing patents “claiming activities that are financial
`
`in nature,
`
`incidental
`
`to a financial activity or complementary to a financial
`
`activity.” See 77 Fed. Reg. 157, p. 48735. Of particular applicability to the ‘107
`
`patent, Sen. Schumer, co-author of § 18, stated that “[t]o meet this [eligibility]
`
`requirement, the patent need not recite a specific financial product or service.
`
`Rather, the patent claims must only be broad enough to cover a financial product
`
`or service.” See 157 Cong. Rec. S1365 (daily ed. Mar. 8, 2011) (Sen. Schumer).
`
`Moreover, the language “practice, administration, or management” is “intended to
`
`cover any ancillary activities related to a financial product or service, including
`
`… customer interfaces, Web site management and functionality, transmission or
`
`management of data, [and] customer communications….” Id.
`
`1.
`
`The Patent Claims Cover a “Financial Product or Service”
`
`The ‘107 patent is directed to a “drug distribution system and method [that]
`
`utilizes a central pharmacy and database to track all prescriptions for a sensitive
`
`-12-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`drug.” (ROX1001, Abstract.) The claimed system is used in commerce. Claim 1
`
`recites controls on prescription drug distribution, “the controls [including] …
`
`contacting the patient’s insurance company; … shipping via US postal service or
`
`a commercial shipping service; . . . requiring manufacture at a single location;
`
`releasing inventory in a controlled manner; [and] checking . . . for cash payments.”
`
`(Id., 8:67-9:32, (emphasis added).) Only one CBM-eligible claim is needed to
`
`deem an entire patent CBM reviewable.1 Here, at least claim 1 is CBM-eligible
`
`expressly covering incidental activities related to a financial product or service—
`
`contacting the patient’s insurance company and checking for cash payments.
`
`Moreover,
`
`the ‘107 patent specification also supports CBM-eligibility,
`
`explaining how the claimed activities are incidental to a financial activity. Prior
`
`Board decisions have looked to the specification,
`
`in light of the claims,
`
`to
`
`determine that a patent is CBM-eligible even though the claims may not map
`
`directly or explicitly to a financial product or service.2 The Board determined that
`
`1 Transitional Program for Covered Business Method Patents—Definitions
`of Covered Business Method Patent and Technological Invention; Final Rule, 77
`Fed. Reg. 48734, 48736 (Aug. 14, 2012) (Response to Comment 8).
`2 See CBM2012-00005, Paper No. 17, January 23, 2013.
`
`-13-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`the specification revealing that the claims encompassed activities incidental to
`
`financial activity was sufficient to deem the patent eligible for CBM review.3
`
`Likewise, the ‘107 patent specification demonstrates how the ‘107 patent
`
`claimed invention is at least incidental to financial activities. For example, for an
`
`early prescription refill, “cash payers are also identified … [and] if the physician
`
`approves … the pharmacist notifies an intake reimbursement specialist to contact
`
`the patient’s insurance provider to verify coverage for the early refill … If the
`
`insurance provider will pay … the specialist submits the coverage approval form
`
`as notification that the refill may be processed.” (ROX1001, 6:41-55.) Moreover,
`
`the ‘107 patent provides “[i]f the insurance provider will not pay ...
`
`it
`
`is
`
`determined whether the patient
`
`is willing and/or able to pay … If it was
`
`determined…that the patient was willing and able to pay, the patient is informed
`
`of the cost of the product and is given payment options … Once payment is
`
`received … the specialist submits a coverage approval form to the pharmacy team
`
`as notification that the refill request can be processed.” (ROX1001, 6:59-7:1.) The
`
`‘107 patent has additional examples which demonstrate that its system is used in
`
`commerce, such as the “NORD” process, which is “used to determine whether
`
`3 See CBM2014-00002, Paper No. 16, April 1, 2014; See also CBM2014-
`00003, Paper No. 12, April 1, 2014.
`
`-14-
`
`

`

`CBM Petition of U.S. Patent No. 7,765,107
`
`donated,
`
`third party funds are available for paying for prescriptions where
`
`neither insurance will, nor the patient can pay.” (ROX1001, 7:4-7.)
`
`Other ‘107 patent claims cover direct or ancillary financial product or
`
`service activities. Claims 1, 2, 4, and 5 all recite activities such as “communicating
`
`... all prescriptions …”; “identifying the physician's name, license, and DEA (Drug
`
`Enforcement Agency) registration information”; “contacting the patient's insurance
`
`company;” “confirming receipt of an initial shipment of the drug to the patient.”
`
`(ROX1001, 8:36-14:8.) These claimed steps are core activities to running a direct
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`shipment exclusive (single) mail order pharmacy business. (ROX1007, ¶¶ 43-44.)
`
`The ‘107 patent’s support for claiming activities incidental to a financial
`
`activity is not at all surprising in view of the Office’s classification of the ‘107
`
`patent within Class 705,
`
`titled “Data processing: financial, business practice,
`
`management, or cost/price determination.” Though this alone might not be
`
`dispositive, it is highly relevant given that the Office itself anticipated that patents
`
`subject to CBM would be “typically classifiable in Class 705.” 77 Fed. Reg. 157,
`
`p. 48711 (Aug. 14, 2012). Further, the ‘107 patent was specifically classified under
`
`subclass 2, “Health care management (e.g., record management, ICDA billing).”
`
`Part of the patents included in the subclass 705/2 definition are “billing systems
`
`based on entered medical codes, for example, ICDA codes.” See Manual of
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`Classification, United States Patent & Trademark Office, Class 705. Billing
`
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`CBM Petition of U.S. Patent No. 7,765,107
`
`systems encompassed within the ‘107 patent are activities that are financial in
`
`nature, incidental to a financial activity or complementary to a financial activity.
`
`Additionally, during the ‘107 patent’s prosecution, the Office’s main cited
`
`prior art—U.S. Patent Publication No. 2004/0019794 (“Moradi”) and U.S. Patent
`
`Publication No. 2003/0093295 (“Lilly”)—also perform processing and operations
`
`used in the practice, administration, or management of a financial product or
`
`service. For example, Moradi discusses making payment arrangements before
`
`dispensing a prescription drug and Lilly discusses contacting insurance companies
`
`to arrange for payment before filling a prescription. (See, e.g., ROX1029, ¶¶7, 32;
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`ROX1030, ¶¶56, 62.)
`
`Whether considering the claims themselves, the specification, the Office’s
`
`classification, or the cited prior art, the conclusion is the same: the ‘107 patent
`
`performs processing and operations that are used in practice, administration, or
`
`management of a financial product or service, qualifying it for CBM review.
`
`2.
`
`The Patent Does Not Claim a “Technological Invention”
`
`The AIA excludes “patents for technological inventions” from the definition
`
`of CBM patents. AIA § 18(d)(2). To determine if a patent is for a technological
`
`invention, “the following will be considered on a case-by-case basis: whether the
`
`claimed subject matter as a whole recites a technological feature that is novel and
`
`unobvious over the prior art; and solves a technical problem using a technical
`
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`CBM Petition of U.S. Patent No. 7,765,107
`
`solution.” 37 C.F.R. § 42.301.
`
`The ‘107 patent does not claim a technological invention under the AIA
`
`because its computer processor and central database components are not
`
`technological features that are novel and non-obvious, and these features are used
`
`to address a non-technical problem using a non-technical solution.
`
`When first proposed, commentators asked the Office to revise the definition
`
`to clarify that a technological
`
`invention was one that met either of these
`
`definitions, or to provide a wholly different test. See, e.g., 77 Fed. Reg. 157, p.
`
`48736-37. But the Office declined to loosen the definition, deciding to maintain the
`
`limited scope of the “technological invention” exception to CBM patents. In so
`
`doing, the Office explained that a narrow exception is consistent with the AIA’s
`
`legislative history and represents “the best policy choice.” Id. at 48735-36.
`
`Under that framework, to be exempt from CBM review, the claimed subject
`
`matter as a whole must: (1) have a technological feature that
`
`is novel and
`
`unobvious; and (2) solve a technical problem using a technical solution. If even
`
`one claim of a patent is not directed to a “technological invention,” the exception
`
`does not apply. 77 Fed. Reg. 157, p. 48736. Here, the ‘107 patent claims do not
`
`meet the requirements of the narrow “technological invention” exception because:
`
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`CBM Petition of U.S. Patent No. 7,765,107
`
`a)
`
`The claimed subject matter does not contain any
`novel or unobvious technological features
`
`The ‘107 patent claims are not directed to novel or nonobvious technological
`
`features. All the claim steps are directed to non-technical drug distribution steps.
`
`None of the ‘107 patent claims’ features are novel or unobvious. Claim 1, for
`
`example, covers an abstract idea with limited references, at best, to a computer
`
`processor and a central database. Because a human intermediary could perform all
`
`of the claim 1 steps, there is nothing technological or inventive in claim 1. Claim 1
`
`merely recites the use of a known generic computer processor interacting with a
`
`known generic central database to perform some of the steps of claim 1. And, a
`
`non-technical implementation, such as the human mind, could perform the recited
`
`steps. The technological invention exception was not intended to immunize such a
`
`technology-generic claim from CBM review. As stated by Sen. Schumer:
`
`to exclude
`invention exception] is not meant
`[the technological
`patents that use known technology to accomplish a business process
`or method of conducting business—whether or not that process or
`method appears to be novel … in other words, a patent is not a
`technological invention because it combines known technology in a
`new way to perform data processing operations. 157 Cong. Rec.
`S1364 (daily ed. March 8, 2011) (Sen. Schumer).
`
`More specifically,
`
`the Office has indicated that
`
`the following claim drafting
`
`techniques would not typically render a patent a technological invention:
`
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`CBM Petition of U.S. Patent No. 7,765,107
`
`(a) Mere recitation of known technologies, such as computer
`hardware, communication or computer networks, software, memory,
`computer-readable storage medium, scanners, display devices or
`databases, or specialized machines, such as an ATM or point of sale
`device.
`(b) Reciting the use of known prior art technology to accomplish a
`process or method, even if that process or method is novel and non-
`obvious.
`(c) Combining prior art structures to achieve the normal, expected, or
`predictable result of that combination.
`(Office Patent Trial Practice Guide, 77 Fe