`
`
`
`
`THE UNITED STATES PATENT AND TRADEMARK OFFICE
`______________________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`______________________________________
`
`LUPIN LTD. and LUPIN PHARMACEUTICALS INC.,
`Petitioners,
`v.
`SENJU PHARMACEUTICAL CO., LTD.,
`Patent Owner
`______________________________________
`
`Case IPR2015-01100
`Patent 8,927,606 B1
`
`______________________________________
`
`
`
`DECLARATION OF JOHN C. JAROSZ
`
`
`SENJU EXHIBIT 2130
`LUPIN v SENJU
`IPR2015-01100
`
`PAGE 1 OF 144
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`

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`
`
`
`I. 
`
`II. 
`
`TABLE OF CONTENTS
`
`INTRODUCTION ................................................................................. 1 
`A.  Assignment .................................................................................. 1 
`B. 
`Qualifications .............................................................................. 2 
`C. 
`Compensation .............................................................................. 4 
`D. 
`Evidence Considered .................................................................. 4 
`E. 
`Summary of Opinions ................................................................. 5 
`BACKGROUND ................................................................................... 8 
`Parties to the Inter Partes Review .............................................. 8 
`A. 
`1. 
`Senju ................................................................................. 8 
`2. 
`Bausch & Lomb ................................................................ 8 
`3. 
`Lupin ............................................................................... 10 
`Cataract Treatments .................................................................. 11 
`Post-Surgery Options ................................................................ 12 
`1. 
`Non-Bromfenac NSAIDs ............................................... 13 
`a. 
`Diclofenac Sodium ............................................... 13 
`b. 
`Ketorolac Tromethamine ...................................... 13 
`c. 
`Nepafenac ............................................................. 14 
`Corticosteroids ................................................................ 14 
`2. 
`Prolensa® .................................................................................. 16 
`1. 
`Earlier Bromfenac Products ............................................ 17 
`2. 
`ISTA’s Acquisition by Bausch & Lomb ........................ 18 
`3. 
`Development and Launch of Prolensa® ......................... 19 
`Patented Technology ................................................................. 19 
`E. 
`FRAMEWORK OF ANALYSIS ........................................................ 22 
`III. 
`IV.  COMMERCIAL SUCCESS OF THE ’606 PATENT ........................ 24 
`A.  Marketplace Success ................................................................. 25 
`1. 
`Absolute Performance of Prolensa® .............................. 25 
`2. 
`Relative Performance of Prolensa® ............................... 29 
`a. 
`Initially ................................................................. 29 
`b. 
`Over Time ............................................................. 31 
`c. 
`Third-Party Perceptions ........................................ 34 
`
`B. 
`C. 
`
`D. 
`
`
`
`i
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`PAGE 2 OF 144
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`
`
`
`B. 
`
`Licensing Activity ................................................ 36 
`d. 
`Causal Nexus ............................................................................. 38 
`1. 
`Benefits of the Patented Inventions ................................ 38 
`a. 
`Clinical Importance of the Benefits ..................... 40 
`b.  Marketing Importance of the Benefits ................. 47 
`i. 
`Healthcare Professionals ............................ 48 
`ii. 
`Other Audiences ......................................... 53 
`Third-Party Perceptions ........................................ 57 
`c. 
`Promotional Activities .................................................... 59 
`a. 
`Informative and Persuasive Advertising .............. 59 
`b. 
`Pharmaceutical Demand Factors .......................... 60 
`i. 
`Impact of Product Characteristics .............. 61 
`ii. 
`Impact of Product Quality .......................... 63 
`Impact of Promotional Efforts ............................. 65 
`c. 
`Impact of Price ..................................................... 71 
`d. 
`Promotional Spending .................................................... 75 
`3. 
`CONCLUSION ................................................................................... 81 
`
`2. 
`
`V. 
`
`
`
`
`
`
`ii
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`PAGE 3 OF 144
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`I, John C. Jarosz, do hereby declare, under penalty of perjury, as follows.
`
`
`
`I.
`1.
`
`INTRODUCTION
`I am over the age of eighteen (18) and otherwise competent to make
`
`this declaration.
`
`A. Assignment
`
`2.
`
`I have been retained as an expert on behalf of Senju Pharmaceutical
`
`Co. Ltd. (“Senju” or “Patent Owner”) as well as Bausch & Lomb
`
`Incorporated and Bausch & Lomb Pharma Holdings Corp. (collectively,
`
`“Bausch & Lomb”) in connection with the above captioned inter partes
`
`review (“IPR”) proceeding before the United States Patent and Trademark
`
`Office Patent Trial and Appeal Board (“PTAB”).
`
`3.
`
`I understand that the PTAB has granted the petition of Lupin Ltd. and
`
`Lupin Pharmaceuticals, Inc. (collectively, “Lupin” or “Petitioners”) to
`
`institute an IPR regarding claims 1-30 of U.S. Patent No. 8,927,606 (the
`
`“’606 patent”) on obviousness grounds. That IPR was assigned Case No.
`
`IPR2015-01100.
`
`4.
`
`I understand that the PTAB has granted the petitions of the Petitioners
`
`to institute separate IPRs regarding claims 1-30 of U.S. Patent No. 8,754,131
`
`(the “’131 patent”), claims 1-30 of U.S. Patent No. 8,669,290 (the “’290
`
`patent”), and claims 1-27 of U.S. Patent No. 8,871,813 (the “’813 patent”)
`
`
`
`1
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`on obviousness grounds. Those IPRs were assigned Case Nos. IPR2015-
`
`
`
`01097, IPR2015-01099, and IPR2015-01105, respectively.
`
`5.
`
`6.
`
`I understand that Senju is the assignee of the ’606 patent and that
`
`Shirou Sawa and Shuhei Fujita are the named inventors of the patent.
`
`I understand that the ’606 patent describes and claims compositions of
`
`the active ingredient bromfenac sodium (“bromfenac”) and the surfactant
`
`tyloxapol.1 I further understand that Prolensa® embodies compositions
`
`claimed in the ’606 patent.
`
`7.
`
`I have been asked by Counsel for Patent Owner to assess whether
`
`Prolensa® has been a marketplace success, and whether such success is
`
`attributable to the inventions claimed in the ’606 patent.
`
`B. Qualifications
`
`8.
`
`I am a Managing Principal of Analysis Group, Inc. (“Analysis
`
`Group”) and Director of the firm’s Washington, DC office. Analysis Group
`
`is an economic, financial, and strategy consulting firm with offices in
`
`Beijing, China; Boston, MA; Chicago, IL; Dallas, TX; Denver, CO; Los
`
`Angeles, CA; Menlo Park, CA; Montreal, Quebec; New York, NY; San
`
`Francisco, CA; and Washington, DC. We provide research and analysis in a
`
`
`1 I understand that a surfactant is a substance that, when added to a liquid,
`reduces the surface tension of that liquid.
`
`
`
`2
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`variety of business, litigation, and regulatory settings, and have particular
`
`
`
`expertise in intellectual property (“IP”) matters, having been engaged in
`
`numerous matters involving patents, trademarks, copyrights, trade secrets,
`
`and unfair competition.
`
`9.
`
`I am an economist whose specialty is IP valuation, monetary relief
`
`assessment, and the economics of commercial success. I have been involved
`
`in more than 350 such engagements spanning a broad range of industries and
`
`technologies, including a variety of engagements covering pharmaceutical
`
`products. I received a J.D. from the University of Wisconsin and an M.A. in
`
`Economics from Washington University in St. Louis, where I completed
`
`most of the requirements for a Ph.D. in Economics. I also hold a B.A. in
`
`Economics and Organizational Communication from Creighton University
`
`in Omaha. I am a member of several professional associations, including the
`
`Licensing Executives Society. I have been a speaker and instructor many
`
`times on a variety of financial, economic, and valuation topics, most having
`
`to do with IP protection.
`
`10.
`
`A copy of my curriculum vitae is provided as Appendix 1. It includes
`
`a more detailed description of my educational background and professional
`
`experience.
`
`
`
`3
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`C. Compensation
`
`
`
`11.
`
`My firm has billed the Patent Owner on a time-and-materials basis for
`
`my work and that of my colleagues. My hourly billing rate is $665. I also
`
`have directed the efforts of other staff members of Analysis Group, whose
`
`hourly billing rates range from $265 to $425. My compensation is not, in
`
`any way, dependent on the outcome of this proceeding or on the substance
`
`of my opinion.
`
`D. Evidence Considered
`
`12.
`
`In undertaking my study and arriving at my conclusions and opinions,
`
`I have relied upon the materials cited here, and considered my own
`
`knowledge, experience, and research, as well as additional information from
`
`a variety of sources that an expert economist would routinely consider in
`
`performing this undertaking. I specifically relied upon the materials cited
`
`and, although at times I refer to only selected portions of a cited reference, it
`
`should be understood that I have considered and relied upon all relevant
`
`aspects of such cited reference.
`
`13.
`
`In connection with the opinions and conclusions contained in this
`
`declaration, I also considered revenue, prescription, and promotional
`
`expenditure data provided by IMS Health (“IMS”).
`
`
`
`
`
`
`
`4
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`
`
`14.
`
`IMS reports manufacturer gross sales data, but does not report
`
`manufacturer net sales data. IMS does not collect the rebates, discounts,
`
`returns and other bottom-line discounts from or to the manufacturer that go
`
`into calculating the amount that a manufacturer or supplier ultimately
`
`receives. The data that IMS does collect measures sales into retail and non-
`
`retail outlets, and represents the actual prices that were charged to the outlet
`
`(i.e., the retail pharmacy, mail pharmacy, clinic, etc.) to acquire the
`
`pharmaceutical products as seen on the purchase invoices. The gross sales
`
`that IMS does report allow for comparisons across competing drugs and
`
`across time. This comparative information is extraordinarily useful to
`
`pharmaceutical companies in the real world, and to courts and panels in
`
`litigations addressing commercial success.
`
`15.
`
`Appendix 2 through Appendix 13 provide a summary of the
`
`voluminous IMS data relating to Prolensa® that I considered. I and others
`
`working under my direction and supervision prepared these appendices.
`
`E.
`
`Summary of Opinions
`
`16.
`
`Based upon my review and analysis of the evidence received to date,
`
`it is my opinion that Prolensa® has achieved substantial marketplace success
`
`in the United States. It is also my opinion that there is a nexus between the
`
`
`
`5
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`marketplace success of Prolensa® and the claims of the ’606 patent. In
`
`
`
`short, the claims of the ’606 patent at issue here have been a commercial
`
`success.
`
`17.
`
`A number of facts demonstrate that Prolensa® has been a marketplace
`
`success. Prolensa®’s revenues and prescriptions grew substantially after its
`
`commercial launch in April 2013. In its first ten quarters of commercial
`
`availability, Prolensa® has been prescribed approximately 1.4 million times
`
`in the U.S., generating $246.9 million in revenue. (Appendix 13.) Prolensa®
`
`achieved this success despite being introduced into a marketplace in which
`
`at least six branded drugs and three generic drugs had already received U.S.
`
`Food and Drug Administration (“FDA”) approval to treat similar indications
`
`as Prolensa®. (See, e.g., Appendix 2.) Since its introduction, Prolensa® has
`
`achieved the second highest share of revenues and prescriptions among
`
`branded drugs with similar indications as Prolensa®. (Appendix 3;
`
`Appendix 6.)
`
`18.
`
`A number of facts demonstrate that there is a causal nexus between
`
`the success of Prolensa® and the claimed features of the ’606 patent. The
`
`patent describes and claims compositions of the active ingredient bromfenac
`
`and the surfactant tyloxapol. Specifically, certain claims of the ’606 patent
`
`disclose methods for treating an inflammatory disease of an eye comprising
`
`
`
`6
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`administering to said eye a stable aqueous liquid compositions of the active
`
`
`
`ingredient bromfenac and the surfactant tyloxapol, which is the technology
`
`embodied in the drug Prolensa®. (Ex. 2082, at ¶176.) I understand that these
`
`compositions have a lower, more natural pH level with improved ocular
`
`penetration relative to other bromfenac formulations, allowing Prolensa® to
`
`deliver the same clinical efficacy, but using a lower concentration of the
`
`active ingredient bromfenac and a lower concentration of surfactant relative
`
`to other bromfenac formulations. The reduced concentrations of active
`
`ingredient and surfactant, as well as the lower pH, result in an improved side
`
`effect profile relative
`
`to other nonsteroidal anti-inflammatory drug
`
`(“NSAID”) formulations, with no stinging or burning. The lower pH and
`
`reduced side effects make Prolensa® more comfortable to use relative to
`
`other NSAID formulations and enhance patient compliance. I further
`
`understand that this formulation has a superior shelf life relative to other
`
`bromfenac formulations. As explained by Dr. Trattler, the development of
`
`Prolensa® was “highly significant to the field of ophthalmology and cataract
`
`surgery.” (Ex. 2116, at ¶51.) The claimed features of the ’606 patent have
`
`been a critical driver of the success of Prolensa®. That is, Prolensa® is
`
`consistently marketed based on the benefits made possible by the ’606
`
`patent.
`
`
`
`7
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`19.
`
`
`
`Bausch & Lomb’s patterns of promotional expenditures on Prolensa®
`
`are consistent with those for competing drugs with similar indications that
`
`became commercially available around the same time as Prolensa®.
`
`(Appendix 12.) Specifically, the patterns of Bausch & Lomb’s promotional
`
`expenditures as a percent of gross sales are consistent with promotional
`
`expenditure patterns for Ilevro®, which was commercially released six
`
`months prior to Prolensa®. (Appendix 12.) And the success of Prolensa® is
`
`not attributable to any pricing advantages, because it has none.
`
`II. BACKGROUND
`A.
`Parties to the Inter Partes Review
`
`1. Senju
`
`20.
`
`Senju is a pharmaceutical company that operates out of Osaka, Japan.
`
`(Ex. 2194; Ex. 2195.) Senju manufactures a number of different prescription
`
`and over-the-counter drugs, specializing in the development of eye care
`
`products and ear, nose, and throat treatments. (Ex. 2194; Ex. 2196.) Senju is
`
`the original assignee of the ’606 patent. (Ex. 1004.)
`
`2. Bausch & Lomb
`
`21.
`
`Bausch & Lomb Incorporated is a manufacturer of eye care products
`
`headquartered in Rochester, New York. (Ex. 2186.) Originally incorporated
`
`as Bausch & Lomb Optical Company, the company changed its name to
`
`
`
`8
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`Bausch & Lomb Incorporated in 1960. (Ex. 2186.) Bausch & Lomb
`
`
`
`Incorporated is a subsidiary of Bausch & Lomb Holdings Incorporated
`
`(“Bausch & Lomb Holdings”). (Ex. 2186.)
`
`22.
`
`I understand that Bausch & Lomb Pharma Holdings Corp. is the
`
`licensee of the ’606 patent from Senju and is a wholly-owned subsidiary of
`
`Bausch & Lomb Incorporated.
`
`23.
`
`In 2007, Bausch & Lomb Holdings was acquired by the private equity
`
`firm Warburg Pincus PLC (“Warburg”) for $4.5 billion, including $3.67
`
`billion in cash and the assumption of $830 million in debt. (Ex. 2212.) As a
`
`result of this acquisition, Bausch & Lomb Holdings stock was delisted from
`
`the New York Stock Exchange on October 26, 2007. (Ex. 2212.)
`
`24.
`
`On June 6, 2012, Bausch & Lomb Holdings acquired ISTA
`
`Pharmaceutical, Inc. (“ISTA”), a manufacturer of eye drugs, in a $465.5
`
`million all-cash transaction.2 (Ex. 2237, at 52. See also, Ex. 2208; Ex. 2210.)
`
`As a result of the acquisition, Bausch & Lomb Holdings gained ownership
`
`of four prescription eye care products, including Bromday® (a once-daily
`
`bromfenac formulation that was first launched in November 2010), as well
`
`as several eye care products in various stages of development, including
`
`Prolensa®. (Ex. 2185, at 5-6; Ex. 2208; Ex. 2210.) Also on June 6, 2012,
`
`
`2 Purchase price is net of cash acquired.
`
`
`
`9
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`Bausch & Lomb Incorporated submitted a New Drug Application (“NDA”)
`
`
`
`to the FDA seeking approval for Prolensa®. (Ex. 2152.)
`
`25.
`
`On August 5, 2013, Warburg sold Bausch & Lomb Holdings to
`
`Valeant Pharmaceuticals International, Inc. (“Valeant”) for approximately
`
`$8.7 billion, including $4.2 billion to repay Bausch & Lomb’s existing debt.
`
`(Ex. 2205; Ex. 2236, at 10-K page 33.) Following the acquisition, Bausch &
`
`Lomb Holdings retained its name and became a division of Valeant, and
`
`Valeant’s existing ophthalmology business was integrated into Bausch &
`
`Lomb Holdings. (Ex. 2184.)
`
`3. Lupin
`
`26.
`
`Lupin Ltd. was founded in 1968. (Ex. 2259.) Headquartered in
`
`Mumbai, India, Lupin Ltd. is a pharmaceutical company that develops
`
`generic and branded formulations as well as active pharmaceutical
`
`ingredients. (Ex. 2260; Ex. 2261.) Lupin Pharmaceuticals, Inc. is a wholly-
`
`owned subsidiary of Lupin Ltd. based in Baltimore, Maryland that aims to
`
`develop generic and branded pharmaceutical products for the U.S. market.
`
`(Ex. 2262; Ex. 2263.) I understand that Lupin Ltd. submitted Abbreviated
`
`New Drug Application (“ANDA”) No. 206027 seeking approval to sell a
`
`generic bromfenac ophthalmic solution, intended to be a generic version of
`
`Prolensa®. (Ex. 2007, at 3-4; Ex. 2008, at 3-4; Ex. 2009, at 3-4; Ex. 2010, at
`
`
`
`10
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`4-5.) I understand that Lupin’s ANDA for generic bromfenac ophthalmic
`
`
`
`solution was submitted three months after Prolensa® received FDA approval
`
`in April 2013. (Ex. 2082, at ¶205.)
`
`B. Cataract Treatments
`
`27.
`
`A cataract is a congenital or degenerative clouding of the lens of the
`
`eye that affects vision. (Ex. 2067, at 606.) Early symptoms include loss of
`
`contrast, glare, needing more light to see well, and problems distinguishing
`
`dark blue and black. (Ex. 2067, at 606.) Cataracts are the leading cause of
`
`blindness worldwide, and affect more than 20 million Americans over the
`
`age of 40. (Ex. 2052, at 447.)
`
`28.
`
`Cataracts develop slowly over time, and occur as a result of aging or
`
`other risk factors such as trauma, smoking and alcohol use, under-nutrition,
`
`exposure to x-rays, or other factors. (Ex. 2067, at 606.) If external treatments
`
`such as corrective eyeglasses or long-term pupillary dilation do not
`
`sufficiently improve eyesight, the next option is surgery. (Ex. 2067, at 607.)
`
`Cataract surgery is one of the most commonly performed operations in the
`
`world. (Ex. 2052, at 447.) During cataract surgery, the clouded lens is
`
`removed from the eye and typically replaced with a plastic or silicone
`
`intraocular lens. (Ex. 2067, at 606-07.)
`
`
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`11
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`C.
`
`Post-Surgery Options
`
`
`
`29.
`
`A wide range of medications are approved for use in treating
`
`inflammation (and pain) following cataract surgery. The two most common
`
`types are NSAIDs and corticosteroids. (See, e.g., Ex. 2153, at 5; Ex. 2155.)
`
`NSAIDs and corticosteroids treat inflammation by different mechanisms.
`
`(Ex. 2116, at ¶23.) They act on different enzymes that cause post-surgical
`
`inflammation and, thus, mediate post-surgical inflammation in different
`
`ways. (Ex. 2116, at ¶23.) Moreover, NSAIDs and corticosteroids exhibit
`
`different side effect profiles. (Ex. 2116, at ¶23.)
`
`30.
`
`In addition to the NSAID bromfenac (the active ingredient in
`
`Prolensa®), the FDA has approved three major topical ophthalmic NSAIDs
`
`for use in the treatment of post-cataract surgery inflammation and, in some
`
`cases, pain:3 1) diclofenac sodium; 2) ketorolac tromethamine; and 3)
`
`nepafenac. (See, e.g., Ex. 2153, at 5; Ex. 2155.)
`
`
`3 The IMS data for USC 61420 (ophthalmic NSAIDs) includes a fourth
`additional NSAID, flurbiprofen sodium, and its branded form Ocufen®.
`However, according to Dr. Trattler, Ocufen® has never been approved by the
`FDA for the treatment of inflammation or pain following cataract surgery. (Ex.
`2116, at ¶25.) To be conservative, the appendices to this declaration show totals
`and relative shares that include Ocufen®/generic flurbiprofen sodium and that
`exclude Ocufen®/generic flurbiprofen sodium.
`
`
`
`12
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`1. Non-Bromfenac NSAIDs
`
`31.
`
`a. Diclofenac Sodium
`Diclofenac sodium is sold under the brand name Voltaren® as a 0.1
`
`percent concentration ophthalmic solution and a 1 percent topical gel. (Ex.
`
`2162; Ex. 2166.) Generic versions of diclofenac sodium are available in
`
`solution and topical gel formulations. (Ex. 2170; Ex. 2171.)
`
`32.
`
`Voltaren® solution first received FDA approval in March 1991. (Ex.
`
`2162.) Diclofenac sodium ophthalmic solution is indicated for the treatment
`
`of inflammation following cataract surgery, and is administered four times
`
`per day through an eye drop. (Ex. 2057.)
`
`33.
`
`b. Ketorolac Tromethamine
`Ketorolac tromethamine is sold in 0.4 percent, 0.45 percent, and 0.5
`
`percent ophthalmic solution formulations under the brand names Acular
`
`LS®, Acuvail®, and Acular®, respectively.4 (Ex. 2161; Ex. 2163; Ex.
`
`2167.) Generic versions of ketorolac tromethamine are available in solution
`
`formulations with varying concentrations. (Ex. 2168; Ex. 2169.)
`
`34.
`
`Acular® first received FDA approval in November 1992. (Ex. 2161.)
`
`4 The IMS data for USC 61420 (ophthalmic NSAIDs) includes a fourth form of
`Acular®, known as Acular PF®. According to Dr. Trattler, Acular PF® was not
`indicated for the treatment of inflammation or pain following cataract surgery.
`(Ex. 2116, at ¶29.) To be conservative, the appendices to this declaration show
`totals and relative shares that include Acular PF® and that exclude Acular PF®.
`
`
`
`13
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`Acular LS® and Acuvail® received FDA approval in May 2003 and July
`
`
`
`2009, respectively. (Ex. 2163; Ex. 2167.) Acular® and Acular LS® are
`
`administered four times per day, while Acuvail® is administered twice per
`
`day. (Ex. 2155, at 18; Ex. 2193.) Ketorolac tromethamine is indicated for the
`
`treatment of inflammation and pain following cataract surgery, and is
`
`administered through an eye drop. (Ex. 2060; Ex. 2183; Ex. 2240.)
`
`35.
`
`c. Nepafenac
`Nepafenac is sold as a 0.1 percent concentration ophthalmic
`
`suspension under the brand name Nevanac® and as a 0.3 percent
`
`concentration ophthalmic suspension under the brand name Ilevro®. (Ex.
`
`2165; Ex. 2178.)
`
`36.
`
`Nevanac® and Ilevro® first received FDA approval in August 2005
`
`and October 2012, respectively. (Ex. 2165; Ex. 2178.) Nevanac® is
`
`administered three times per day, while Ilevro® is administered once per
`
`day. (Ex. 2155, at 18; Ex. 2193.) Nepafenac is indicated for the treatment of
`
`inflammation and pain following cataract surgery and is administered
`
`through an eye drop. (Ex. 2241.)
`
`2. Corticosteroids
`
`37.
`
`Various corticosteroids have been approved for the treatment of post-
`
`operative inflammation and, in some cases, pain. These treatments include
`
`loteprednol etabonate 0.5 percent ophthalmic solution, sold under the brand
`14
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`name Lotemax®; difluprednate 0.05 percent ophthalmic solution, sold under
`
`
`
`the brand name Durezol®; and rimexolone 1 percent ophthalmic suspension,
`
`sold under the brand name Vexol®. (Ex. 2153, at 5; Ex. 2155.)
`
`38.
`
`Although NSAIDs and corticosteroids can both be used to treat post-
`
`operative ophthalmic inflammation and pain, they represent distinct drug
`
`classes. (Ex. 2155.) According to Dr. Trattler, NSAIDs and corticosteroids
`
`act on different enzymes that cause post-surgical inflammation and, thus,
`
`mediate the major inflammatory response following surgical trauma in
`
`different ways. (Ex. 2116, at ¶23.)
`
`39.
`
`An October 2014 review, done by Dr. Line Kessel et al., of existing
`
`research comparing the effectiveness of NSAIDs and corticosteroids in
`
`treating inflammation following cataract surgery found that NSAIDs are
`
`more effective in controlling inflammation and recommended the use of
`
`NSAIDs over corticosteroids to prevent inflammation. (Ex. 2202, at 1922.)
`
`Additionally, NSAIDs and corticosteroids have different side effect profiles
`
`when used to treat ocular inflammation. (Ex. 2116, at ¶23; Ex. 2119.) The
`
`superior performance and different side effect profile of NSAIDs relative to
`
`corticosteroids are also consistent with Bausch & Lomb’s Prolensa®
`
`marketing and promotional materials, which focus almost exclusively on
`
`NSAIDs with only passing mentions of corticosteroids. (See, e.g., Ex. 2220;
`
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`Ex. 2221; Ex. 2226.)
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`
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`40.
`
`The relevant competitive marketplace for Prolensa®
`
`includes
`
`ophthalmic NSAIDs that are indicated for the treatment of inflammation or
`
`inflammation and pain following cataract surgery.5 It does not include
`
`corticosteroids.6
`
`D.
`
`Prolensa®
`
`41.
`
`I understand that Prolensa® embodies the relevant claims of the ’606
`
`patent. (Ex. 2082, at ¶176.) Approved by the FDA on April 5, 2013,
`
`Prolensa® is a once-daily, sterile, topical, NSAID indicated for the treatment
`
`of postoperative inflammation and reduction of ocular pain in patients who
`
`have undergone cataract surgery. (Ex. 1049; Ex. 2176.) Prolensa® contains
`
`5 There is some evidence that Bausch & Lomb considers Prolensa/bromfenac’s
`competitive set to be limited to branded ketorolac (i.e., Acular LS®, Acuvail®,
`and Acular®), generic ketorolac, and branded Nepafenac (i.e., Nevanac® and
`Ilevro®). (Ex. 2220, at 8.) However, the IMS data for USC 61420 (ophthalmic
`NSAIDs) also includes Voltaren® and generic diclofenac sodium, which are
`also indicated for the treatment of inflammation following cataract surgery. (Ex.
`2057.) I have included Voltaren® and generic diclofenac sodium in my
`analysis.
`
`6
`
`
`
`
`
`
`
`
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`a 0.07 percent concentration of the active NSAID bromfenac. (Ex. 1049.)
`
`
`
`Prolensa® is formulated using tyloxapol as a surfactant. (Ex. 1049.)
`
`Prolensa® was first commercially available in April 2013. (Ex. 2211.)
`
`Prolensa® is administered through an eye drop. (Ex. 1049.)
`
`1. Earlier Bromfenac Products
`
`42.
`
`In July 2000, bromfenac was approved for use in Japan and was
`
`marketed by Senju under the name Bronuck. (Ex. 2224; Ex. 2226, at 10.)
`
`ISTA acquired the ophthalmic rights to bromfenac under a license from
`
`Senju in May 2002. (Ex. 2229.) On March 24, 2005, ISTA received U.S.
`
`FDA approval for Xibrom®, a twice-daily topical NSAID for the treatment
`
`of ocular inflammation following cataract surgery. (Ex. 2164; Ex. 2213; Ex.
`
`2223.) Xibrom® contains a 0.09 percent concentration of the active NSAID
`
`bromfenac, and uses polysorbate 80 as a surfactant. (Ex. 2164; Ex. 2190; Ex.
`
`2213.) Xibrom® was first commercially available in the second quarter of
`
`2005. (Ex. 2213; see also, Appendix 2; Appendix 5.) In January 2006, the
`
`FDA expanded the approved Xibrom® indications to include the treatment
`
`of pain following cataract surgery. (Ex. 2189; Ex. 2223.)
`
`43.
`
`On October 16, 2010, ISTA received FDA approval for Bromday®, a
`
`once-daily topical NSAID for the treatment of ocular inflammation and pain
`
`following cataract surgery. (Ex. 2164; Ex. 2188; Ex. 2223.) Like Xibrom®,
`
`
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`Bromday® contains a 0.09 percent concentration of the active NSAID
`
`
`
`bromfenac, and uses polysorbate 80 as a surfactant; however Bromday® is
`
`dosed once a day compared to twice daily for Xibrom®. (Ex. 1009; Ex.
`
`2164; Ex. 2188.) Bromday® was first launched commercially in November
`
`2010. (Ex. 2185.)
`
`44.
`
`The first generic version of Xibrom® was launched in May 2011 by
`
`Mylan under a development and supply agreement with Coastal
`
`Pharmaceuticals. (Ex. 2214; Ex. 2242.) Subsequently, several additional
`
`generic pharmaceutical companies, including Paddock LLC, Luitpold,
`
`Apotex Inc., and Hi-Tech Pharmacal, launched generic bromfenac 0.09
`
`percent ophthalmic solutions, including generic versions of Bromday. (Ex.
`
`2172; Ex. 2173; Ex. 2174; Ex. 2175; Ex. 2177; Ex. 2238; Ex. 2239.)
`
`2. ISTA’s Acquisition by Bausch & Lomb
`
`45.
`
`Bausch & Lomb (which, at the time, was owned by Warburg) paid
`
`$465.5 million to acquire ISTA in June 2012.7 (Ex. 2208; Ex. 2210; Ex.
`
`2237, at 52.) At the time of the acquisition, ISTA had Prolensa® in its
`
`product pipeline. (Ex. 2210.) Ten months after Bausch & Lomb’s acquisition
`
`of ISTA, in preparation for the sale of Bausch & Lomb, Warburg filed an S-
`
`1 statement with the U.S. Securities and Exchange Commission (“SEC”) in
`
`
`7 Purchase price is net of cash acquired.
`
`
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`which it identified the fair value of Bromday® and Prolensa® at $297.9
`
`
`
`million, or approximately 64 percent of the $465.5 million acquisition price
`
`for ISTA.8 (Ex. 2237, at 53.)
`
`3. Development and Launch of Prolensa®
`
`46.
`
`On June 6, 2012, the same day that Bausch & Lomb’s acquisition of
`
`ISTA was completed, Bausch & Lomb submitted NDA No. 203168 to the
`
`FDA seeking approval for Prolensa®. (Ex. 2152.) On April 5, 2013, the
`
`FDA approved Prolensa® for the treatment of postoperative inflammation
`
`and reduction of ocular pain in patients who have undergone cataract
`
`surgery. (Ex. 1049; Ex. 2176.) Like Bromday®, Prolensa® is a once-daily
`
`topical NSAID. (Ex. 1049; Ex. 1009.) However Prolensa® contains a lower
`
`concentration of bromfenac than Bromday® (0.07 percent vs. 0.09 percent),
`
`and uses tyloxapol rather than polysorbate 80 as the surfactant. (Ex. 1049;
`
`Ex. 1009.)
`
`E.
`
`Patented Technology
`
`47.
`
`The ’606 patent, entitled “Aqueous Liquid Preparation Containing 2-
`
`Amino-3-(4-Bromobenzoyl)Phenylacetic Acid,” was filed on September 23,
`
`2014 and issued to Senju on January 6, 2015. (Ex. 1004.) The Abstract of
`
`the patent provides,
`
`
`8 $297.9 million / $465.5 million = 64.0 percent.
`
`
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`
`
`An aqueous liquid preparation of the present invention
`containing 2-amino-3-(4-bromobenzoyl)phenylacetic acid or its
`pharmacologically acceptable salt or a hydrate thereof, an alkyl
`aryl polyether alcohol type polymer such as tyloxapol, or a
`polyethylene glycol fatty acid ester such as polyethylene glycol
`monostearate is stable. Since even in the case where a
`preservative
`is
`incorporated
`into
`said aqueous
`liquid
`preparation, the preservative exhibits a sufficient preservative
`effect for a long time, said aqueous liquid preparation in the
`form of an eye drop is useful for the treatment of blepharitis,
`conjunctivitis, scleritis, and postoperative inflammation. Also,
`the aqueous liquid preparation of the present invention in the
`form of a nasal drop is useful for the treatment of allergic
`rhinitis and
`inflammatory rhinitis (e.g. chronic rhinitis,
`hypertrophic rhinitis, nasal polyp, etc.). (Ex. 1004, at 1.)
`
`48.
`
`I understand that certain claims of the ’606 patent are directed to
`
`methods for treating an inflammatory disease of an eye comprising
`
`2‐Amino‐3‐(4‐bromobenzoyl)phenylacetic acid (also known as bromfenac)
`
`administering
`
`to said eye a stable aqueous
`
`liquid preparation of
`
`and the surfactant tyloxapol, which is the technology embodied in the drug
`
`Prolensa®. (Ex. 1004, at 3; Ex. 2082, at ¶176.)
`
`49.
`
`I understand that Petitioners contend that U.S Patent Nos. 4,910,225
`
`(the “’225 patent”) and 5,891,913 (the “’913 patent”) constitute prior art to
`
`the ’606 patent. I understand that the ’225 patent relates to compositions of
`
`bromfenac and polysorbate 80, while the ’913 patent relates to compositions
`
`of diclofenac and tyloxapol. Xibrom® and Bromday®, which are products
`
`that use the active ingredient bromfenac, use polysorbate 80 as the
`
`
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`surfactant. (Ex. 1009