`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`_____________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`_____________________________
`
`MYLAN LABORATORIES LIMITED,
`
`Petitioner,
`
`v.
`
`AVENTIS PHARMA, S.A.,
`
`Patent Owner.
`
`_____________________________
`
`Patent No. 8,927,592
`
`_____________________________
`
`
`
`DECLARATION OF MR. ROBERT MCSORLEY
`
`
`
`MYLAN - EXHIBIT 1044
`Mylan Laboratories Limited v. Aventis Pharma S.A.
`IPR2016-00712
`
`0001
`
`
`
`TABLE OF CONTENTS
`
`
`
`I.
`
` Qualifications ................................................................................................. 1
`
`II. Assignment ..................................................................................................... 2
`
`III. Summary of Opinions ................................................................................... 4
`
`IV. The Parties .................................................................................................... 6
`
`V. Legal Proceedings Concerning the ‘592 Patent ............................................... 7
`
`VI. U.S. Patents Relating to Jevtana® and Taxotere®........................................... 8
`
`VII. The Relevant Market ...................................................................................12
`
`VIII. Assessment of Commercial Success .............................................................19
`
`IX. Analysis of the Tate Declaration and My Opinions ......................................24
`
`X. Compensation and Signature..........................................................................69
`
`
`
`ii
`
`
`
`
`
`
`
`0002
`
`
`
`I.
`
`Qualifications
`
`
`
`1.
`
`I am a Director with Ocean Tomo, LLC, an Intellectual Property
`
`(“IP”) consulting firm providing financial products and services including IP
`
`expert services, valuation, research, investments and transactions. Ocean Tomo
`
`assists clients — individuals, corporations, law firms, and investors — in assessing
`
`the value of IP and other intangible assets.
`
`2.
`
` I am a CPA with more than 24 years of experience addressing the
`
`economic and financial issues concerning commercial and IP litigation. I have
`
`been involved with the financial and economic aspects of patent infringement
`
`disputes since 1992, and I have studied the relevant legal opinions in this area.
`
`During the past 11 years, I have spent considerable time addressing these issues in
`
`the context of pharmaceutical patent infringement matters.
`
`3.
`
`I have been qualified as a financial/economic expert and testified
`
`before several Federal District Courts and the American Arbitration Association as
`
`an expert witness. Federal District Courts have accepted my opinions and have
`
`indicated that my testimony, as it relates to the economic and financial aspects of
`
`patent infringement disputes, is credible.
`
`4.
`
`I obtained my Bachelor of Science degree in Accounting from The
`
`Pennsylvania State University in 1989. I obtained my JD degree from The
`
`
`
`1
`
`0003
`
`
`
`University of Pittsburgh School of Law in 1996. A listing of my prior testimony is
`
`provided in my C.V., attached as Attachment 1.
`
`II. Assignment
`
`5.
`
`I have been asked by counsel for Mylan Laboratories Limited
`
`(“Mylan”) to provide expert testimony in this matter concerning U.S. Patent Nos.
`
`8,927,592 (“the ‘592 patent”). I have also been asked to review and assess the
`
`December 23, 2016, Expert Declaration of Michael E. Tate (“Mr. Tate”; “the Tate
`
`Declaration”) submitted on behalf of Aventis Pharma, S.A. (“Aventis”). I have
`
`also been asked to address certain secondary considerations of non-obviousness,
`
`including the alleged commercial success of Jevtana®.
`
`6.
`
`In addition, I have been asked to consider whether there is a nexus
`
`between the claimed merits of the ‘592 patent and Jevtana® sales. In other words, I
`
`have been asked to consider whether Jevtana® sales are due to the subject matter of
`
`the asserted claims of the ‘592 patent.
`
`7.
`
`I have gained an understanding of the relevant facts based on my
`
`experience and analysis of the information made available to me, including, but not
`
`limited to the following:
`
`• Legal filings;
`
`• Documents produced by Aventis;
`
`
`
`2
`
`0004
`
`
`
`• Publicly available information relating to the parties, the U.S. drug
`
`market, and the relevant drug products;
`
`• Monthly sales and prescription data for Jevtana® and other drugs used
`
`to treat prostate cancer;
`
`• The Tate Declaration, dated December 23, 2016;
`
`• Records considered by Mr. Tate;
`
`• The Deposition of Mr. Tate, dated March 6, 2017;
`
`• The Declaration of Dr. Rahul Seth, dated March 15, 2016 (“the Seth
`
`Declaration”);
`
`• The Deposition of Dr. Seth dated December 9, 2016;
`
`• The Declaration of Alton Sartor, M.D., dated December 22, 2016
`
`(“the Sartor Declaration”);
`
`• The Deposition of Dr. Sartor, dated February 13, 2017;
`
`• The ‘592 patent; and
`
`• Other U.S. patents.
`
`8.
`
`A detailed listing of documents considered is included in the footnotes
`
`hereto and/or the summary provided in Attachment 2. Attachment 3 is a
`
`Timeline of Events relating to this matter. The opinions expressed in this
`
`Declaration are based on my current understanding of the facts, my review of the
`
`records produced by the parties, and other public information.
`
`
`
`3
`
`0005
`
`
`
`III. Summary of Opinions
`
`9.
`
`Based in part on my review of the record evidence, I have concluded
`
`that:
`
`• Mr. Tate’s analyses of the alleged commercial success of Jevtana®
`
`utilizes an improperly narrow market definition. Mr. Tate’s market
`
`definition ignores product sales that compete with Jevtana® at every
`
`line of therapy in which Jevtana® is utilized, including off-label use as
`
`first-line therapy. Mr. Tate’s market definition also fails to consider
`
`that both Taxotere® and Jevtana® were displaced as primary prostate
`
`cancer and metastatic castration-resistant prostate cancer (“mCRPC”)
`
`treatments during the relevant time period.
`
`• Jevtana® is not a commercial success. Jevtana® shares of the prostate
`
`cancer drug market and the mCRPC drug market segment are not
`
`significant. Jevtana® sales declined after the first full year on the
`
`market, and later increased at rates that are substantially less than
`
`those of the overall market. In addition, Jevtana® actual sales levels
`
`failed to meet Aventis’s own expectations.
`
`• Mr. Tate’s analyses of the alleged commercial success of Jevtana®
`
`fails to consider the profit, if any, Aventis realized from sales of
`
`Jevtana®, and fails to establish a nexus between sales of Jevtana® and
`
`
`
`4
`
`0006
`
`
`
`the alleged merits of the ‘592 patent. Thus, Mr. Tate fails to establish
`
`that Jevtana® is a commercial success as that term is defined by
`
`Federal courts for purposes of evaluating the alleged non-obvious
`
`nature of patented subject matter.
`
`• No nexus exists between sales of Jevtana® products and the alleged
`
`merits of the ‘592 patent. Factors that influence Jevtana® sales
`
`include: 1) the benefits and advantages of the taxane class and other
`
`subject matter disclosed in prior art, 2) physicians’ familiarity and
`
`prior experience with taxanes to treat prostate cancer, and 3) Aventis’s
`
`promotional activities.
`
`• Due to Aventis’s patenting practices, during the relevant time period,
`
`other researchers had little, if any, economic incentive to research,
`
`develop, commercially test, or commercialize in the U.S. drug
`
`products that contain cabazitaxel. The existence of previously-issued
`
`U.S. patents relating to cabazitaxel created economic disincentives, if
`
`not independent legal barriers, to other market entrants. Thus, the
`
`issue of the alleged commercial success of Jevtana® should be given
`
`little, if any, weight.
`
`
`
`5
`
`0007
`
`
`
`IV. The Parties
`
`10. Mylan – Mylan is a corporation organized and existing under the laws
`
`of India.1 Mylan is a wholly-owned subsidiary of Mylan N.V.2 Mylan N.V.’s
`
`global headquarters are in Canonsburg, Pennsylvania.3
`
`11. Mylan N.V., along with its subsidiaries, is a leading global
`
`pharmaceutical company which develops, licenses, manufactures, markets and
`
`distributes generic, brand name and over-the-counter products in a variety of
`
`dosage forms and therapeutic categories.4 Mylan N.V. holds a top two ranking
`
`within the U.S. generics prescription market in terms of both sales and
`
`prescriptions dispensed. Approximately one in every thirteen prescriptions
`
`dispensed in the U.S. is a Mylan N.V. product.5
`
`
`
`1 EX1055, Defendant’s Answer to the Complaint, Separate Defenses and
`
`Counterclaims, C.A. No.: 3:15-cv-3392, District of New Jersey, filed July 16,
`
`2015, p. 10.
`
`2 EX1056, Mylan Form 2016 Form 10-K, p. 4.
`
`3 EX1056, Mylan Form 2016 Form 10-K, p. 4.
`
`4 EX1056, Mylan Form 2016 Form 10-K, p. 3.
`
`5 EX1056, Mylan Form 2016 Form 10-K, p. 6.
`
`
`
`6
`
`0008
`
`
`
`12. Aventis – Aventis is a corporation organized and existing under the
`
`laws of France, with a principal place of business in Antony, France.6 Aventis is a
`
`wholly-owned subsidiary of Sanofi.7
`
`13.
`
`In 1999, Hoechst AG and Rhone-Poulenc S.A. merged to create
`
`Aventis.8 Aventis was acquired by Sanofi in 2004.9
`
`14. Sanofi is a global healthcare company.10 Sanofi’s pharmaceutical
`
`products include treatments for rare diseases, Multiple Sclerosis, oncology,
`
`diabetes, and cardiovascular diseases.11
`
`V. Legal Proceedings Concerning the ‘592 Patent
`
`15. Mylan filed a Petition with the U.S. Patent and Trademark Office
`
`requesting an inter partes review of claims 1 – 5 and 7 – 30 of the ‘592 patent,
`
`
`
`6 EX1055, Defendant’s Answer to the Complaint, Separate Defenses and
`
`Counterclaims, C.A. No.: 3:15-cv-3392, District of New Jersey, filed July 16,
`
`2015, pp. 10 - 11.
`
`7 EX1091, Sanofi Form 2016 Form 20-F, p. 73.
`
`8 EX1057, https://www.britannica.com/topic/Hoechst-Aktiengesellschaft
`
`9 EX1057, https://www.britannica.com/topic/Hoechst-Aktiengesellschaft
`
`10 EX1091, Sanofi 2016 Form 20-F, p. 19.
`
`11 EX1091, Sanofi 2016 Form 20-F, pp. 19 - 20.
`
`
`
`7
`
`0009
`
`
`
`alleging that these claims are unpatentable under 35 U.S.C. § 103(a).12
`
`16.
`
`In addition to this inter partes review, the following district court
`
`cases are pending in the Federal District Court for the District of New Jersey, and
`
`concern the alleged invalidity of the ‘592 patent:
`
`• Sanofi-Aventis U.S. LLC v. Mylan Laboratories Limited (15-03392)
`
`• Sanofi-Aventis U.S. LLC v. Apotex Corp (15-01835)
`
`• Sanofi-Aventis U.S. LLC v. Breckenridge Pharmaceutical, Inc. (15-
`
`01836)
`
`• Sanofi-Aventis U.S. LLC v. Accord Healthcare, Inc. (15-02520)
`
`• Sanofi-Aventis U.S. LLC v. BPI Labs, LLC (15-02521)
`
`• Sanofi-Aventis U.S. LLC v. Dr. Reddy Laboratories, Inc. (15-02522)
`
`• Sanofi-Aventis U.S. LLC v. Glenmark Generics Inc. (15-02523)
`
`• Sanofi-Aventis U.S. LLC v. Fresenius Kabi USA, LLC (15-02631)
`
`• Sanofi-Aventis U.S. LLC v. Actavis LLC (15-03107)
`
`VI. U.S. Patents Relating to Jevtana® and Taxotere®
`
`17. The ‘592 Patent - The ‘592 patent, titled “Antitumoral Use of
`
`Cabazitaxel,” issued January 6, 2015, from an application filed April 26, 2012.
`
`The ‘592 patent claims priority through an international application to a series of
`
`
`
`12 Paper 9; Decision Institution of Inter Partes Review, September 22, 2016, p. 2.
`
`
`
`8
`
`0010
`
`
`
`provisional applications, the earliest of which is dated October 29, 2009. The ‘592
`
`patent has 30 claims, of which only Claims 1 and 27 are independent.
`
`18. The ‘592 patent is directed to the use of cabazitaxel in the treatment of
`
`prostate cancer, particularly mCRPC. The claimed method is directed to
`
`administering 20-25 mg/m2 of cabazitaxel and a corticoid to prostate cancer
`
`patients whose disease has progressed in spite of previous docetaxel treatment.13
`
`19. Other Orange Book Listed Patents for Jevtana® – In addition to the
`
`‘592 patent, seven other U.S. patents have been listed for Jevtana® in the U.S. FDA
`
`Orange Book. Figure A below provides information concerning the Orange Book
`
`listed U.S. patents for Jevtana®.14
`
`
`
`13 Paper 9; Decision Institution of Inter Partes Review, September 22, 2016, p. 6.
`
`14 See also, Attachment 4.1.
`
`
`
`9
`
`0011
`
`
`
`Figure A
`
`Other Jevtana® Orange Book Listed Patents
`
`U.S.
`Patent No.
`
`Filing
`Date
`
`Issue
`Date
`
`Expiration
`Date
`
`Assignee
`
`5,438,072
`
`11/22/93
`
`8/1/95
`
`11/22/13 Rhone-Poulenc Rorer S.A.
`
`5,698,582
`
`3/3/95
`
`12/16/97
`
`7/3/12 Rhone-Poulenc Rorer S.A.
`
`5,847,170
`
`3/26/96
`
`12/8/98
`
`3/26/16 Rhone-Poulenc Rorer S.A.
`
`6,331,635
`
`4/28/98
`
`12/18/01
`
`3/26/13 Aventis Pharma S.A.
`
`6,372,780
`
`1/3/01
`
`4/16/02
`
`3/26/13 Aventis Pharma S.A.
`
`6,387,946
`
`9/25/01
`
`5/14/02
`
`3/26/13 Aventis Pharma S.A.
`
`7,241,907
`
`9/17/04
`
`7/10/07
`
`12/10/25 Aventis Pharma S.A.
`
`8,927,592
`
`4/26/12
`
`1/6/15
`
`10/27/30 Aventis Pharma S.A.
`
`
`
`20. As Figure A illustrates, U.S. Patent No. 5,428,072 was the first issued
`
`patent listed for Jevtana®, and was granted in August 1995. I understand that U.S.
`
`Patent No. 5,847,170 issued in December 1998 (“the ‘170 patent”), is directed to
`
`the compound cabazitaxel.15 As reflected in Figure A, U.S. Patent 7,241,907 is
`
`the second most recently issued U.S. Patent listed for Jevtana®,16 and was granted
`
`in July 2007. The ’592 patent purports to extend patent protection over Jevtana®
`
`more than fourteen years beyond the expiration of the ’170 patent.
`
`
`
`15 Paper 9; Decision Institution of Inter Partes Review, September 22, 2016, p. 3.
`
`16 Other than the ‘592 patent.
`
`
`
`10
`
`0012
`
`
`
`21. Orange Book Listed Patents for Taxotere® – Five U.S. patents have
`
`been listed for Taxotere® in the U.S. FDA Orange Book. Figure B provides
`
`information concerning these five U.S. patents.17
`
`Figure B
`
`Taxotere® Orange Book Listed Patents
`
`U.S.
`Patent No.
`
`Filing
`Date
`
`Issue
`Date
`
`Expiration
`Date
`
`Assignee
`
`4,814,470
`
`7/14/87
`
`3/21/89
`
`5/14/10 Rhone-Poulenc Sante
`
`5,438,072
`
`11/22/93
`
`8/1/95
`
`11/22/13 Rhone-Poulenc Rorer S.A.
`
`5,698,582
`
`3/3/95
`
`12/16/97
`
`7/3/12 Rhone-Poulenc Rorer S.A.
`
`5,714,512
`
`12/7/95
`
`2/3/98
`
`7/3/12 Rhone-Poulenc Rorer S.A.
`
`5,750,561
`
`4/12/95
`
`5/12/98
`
`7/3/12 Rhone-Poulenc Rorer S.A.
`
`
`
`22. As Figure B illustrates, U.S. Patent No. 4,814,470 (“the ‘470 patent”)
`
`was the first issued patent listed for Taxotere®, and was granted in March 1989. I
`
`understand that the ‘470 patent is directed to the compound docetaxel, the active
`
`ingredient of Taxotere®.18 As reflected in Figure B, U.S. Patent 5,750,561 is the
`
`most recently issued U.S. Patent listed for Taxotere®, and was granted in May
`
`1998.
`
`
`
`17 See also, Attachment 4.2.
`
`18 EX1059, 2011 Orange Book, p. 1051; EX2128, Sanofi 2010 Form 20-F, p. F-97.
`
`
`
`11
`
`0013
`
`
`
`VII. The Relevant Market
`
`A. Products Competing in the Prostate Cancer Drug Market
`
`23. The FDA has approved chemotherapy treatments, hormone therapy,
`
`and other medications for the treatment of prostate cancer and mCRPC. The
`
`following provides information about the drug products approved by the FDA.
`
`• Taxotere® (docetaxel) – a chemotherapeutic taxane compound.
`
`Taxotere® kills cancer cells by binding to tubulin in the cell and
`
`thereby arresting cellular mitosis19 which ultimately results in
`
`destroying many of the cancer cells.20 Taxotere® received initial
`
`FDA approval in 1996,21 and final approval in 2004.22 The ’170
`
`patent was filed the same year that Taxotere® received initial FDA
`
`approval, and the ’592 was filed shortly after the ’470 patent on
`
`Taxotere expired. The FDA approved Jevtana® in June 2010,
`
`shortly before the PCT application was filed that ultimately
`
`
`
`19 EX1002, Seth Declaration, March 15, 2016, p. 29.
`
`20 EX1091, Sanofi 2016 Form 20-F, p. 26.
`
`21 EX1024, Taxotere® Label; EX1060, Docetaxel Label updated March 2012.
`
`22 EX2176, Sartor Declaration, December 22, 2016, p. 4.
`
`
`
`12
`
`0014
`
`
`
`resulted in the ’592 patent.23 Taxotere® and Jevtana® are both
`
`manufactured and marketed by Aventis and Sanofi.24
`
`• Jevtana® (cabazitaxel) – a semi-synthetic taxane compound. Like
`
`Taxotere®, Jevtana® kills cancer cells by binding to tubulin in the
`
`cell.25 Jevtana® received FDA approved in June 2010 for
`
`administration in combination with prednisone for patients with
`
`mCRPC who were previously treated with a docetaxel-containing
`
`regimen.26
`
`Sanofi attempted to gain approval for Jevtana® as a first line therapy,
`
`but failed to demonstrate superior survival rates to docetaxel.
`
`Nevertheless, Jevtana® is also prescribed as a first line, pre-docetaxel
`
`treatment for cancer patients with advanced metastatic disease.
`
`• Xofigo® (radium Ra 223 dichloride) – an alpha particle-emitting
`
`radioactive therapeutic agent indicated for the treatment of patients
`
`
`
`23 EX1091, Sanofi 2016 Form 20-F, p. 26.
`
`24 EX1091, Sanofi 2016 Form 20-F, p. 26.
`
`25 EX1002, Seth Declaration, March 15, 2016, p. 29.
`
`26 EX1091, Sanofi 2016 Form 20-F, p. 26.
`
`
`
`13
`
`0015
`
`
`
`with castration-resistant prostate cancer.27 Xofigo® is administered as
`
`an intravenous (IV) injection and treats prostate cancer that is resistant
`
`to medical or surgical treatments.28 Xofigo® was approved in May
`
`2013, and is marketed by Bayer Healthcare.29 Xofigo® is prescribed
`
`before or after treatment with docetaxel.
`
`• Xtandi® (enzalutamide) – an oral, androgen receptor inhibitor first
`
`indicated for the treatment of patients with mCRPC who have
`
`previously received docetaxel.30 Xtandi® interferes with the
`
`connection between androgens and androgen receptors. This helps
`
`slow cancer cell growth.31
`
`Xtandi® was originally approved by the FDA in August 2012.32 In
`
`September 2014, the FDA approved Xtandi® for the treatment of
`
`
`
`27 EX2175, Xofigo® Label, May 2013, p. 1.
`
`28 EX2167, About Xofigo® Website, p. 1.
`
`29 EX2166, Xofigo® Approval Letter, pp. 1, 8.
`
`30 EX2173, August 2012 Xtandi® Label, p. 1.
`
`31 EX2163, How Xtandi® Works, p. 1.
`
`32 EX2162, Xtandi® Approval Letter, pp. 1, 8.
`
`
`
`14
`
`0016
`
`
`
`mCRPC not previously treated with docetaxel.33 Thus, Xtandi®
`
`demonstrated therapeutic benefits that are superior to those of
`
`docetaxel. Xtandi® is marketed by Astellas Pharma U.S., and
`
`Medivation, Inc.
`
`• Zytiga® (abiraterone acetate) – an oral medication that inhibits
`
`androgen production, Zytiga® is indicated for use in combination with
`
`prednisone for the treatment of patients with mCRPC who have
`
`received prior chemotherapy containing docetaxel. Zytiga® works by
`
`interrupting the androgen-making process. In December 2012, the
`
`FDA also approved Zytiga® for use in combination with prednisone
`
`for mCRPC not previously treated with docetaxel.34 Thus, Zytiga®
`
`demonstrated therapeutic benefits that are superior to those of
`
`docetaxel. Zytiga is marketed by Janssen Biotech, Inc.
`
`• Provenge® (sipuleucel-T) – a personalized immunotherapy treatment
`
`for asymptomatic or minimally symptomatic mCRPC, used to treat
`
`certain patients with advanced prostate cancer. Provenge® takes the
`
`patient’s immune cells and reprograms them to attack advanced
`
`
`
`33 EX1061, http://www.medscape.com/viewarticle/831548.
`
`34 EX2159, How Zytiga® Works, p. 1; EX2011, D’Amico, p. 1.
`
`
`
`15
`
`0017
`
`
`
`prostate cancer.35 Provenge® was approved by the FDA in April
`
`2010.36 Provenge® is marketed by Dendreon Corporation.
`
`• Traditional Hormone Therapy – a form of systematic therapy that
`
`works to add, block or remove hormones from the body to slow or stop
`
`the growth of cancer cells. Hormone therapy usually involves taking
`
`medications that prevent cancer cells from getting the hormones they
`
`need to grow. It is often used in combination with other cancer
`
`treatments such as chemotherapy and radiation.37 The hormone
`
`therapy category includes GnRH agonists (e.g., Lupron®, and
`
`Zoladex®), antagonists (e.g., degaralix), and oral anti-androgens (e.g.
`
`Casodex®).38
`
`• Novantrone® (mitoxantrone) – is an IV injected cytotoxic
`
`chemotherapy. Novantrone® is also classified as an antitumor
`
`
`
`35 EX2157, What is Provenge®, p. 1.
`
`36 EX2156, Provenge® Approval Letter, p. 1.
`
`37 EX2153, Prostate Cancer Treatment, p. 2.
`
`38 EX2171, Monthly Jevtana Prostate Cancer Treatment Report, August 2014, p.
`
`37.
`
`
`
`16
`
`0018
`
`
`
`antibiotic.39 Novantrone® was approved by the FDA in December
`
`1996 for treatment of advanced hormone-refractory prostate cancer.40
`
`According to Dr. Sartor, mitoxantrone was a de facto community
`
`standard for treating mCRPC patients who had progressed during or
`
`after treatment with docetaxel in the 2006 through 2009 time frame
`
`because of its palliative benefits in those patients.41
`
`• Emcyt® (estramustine) – a cell cycle specific, antimicrotubule agent,
`
`estramustine acts on the microtubule structure and function of the cell
`
`by attaching to the microtubule-associated proteins. Estramustine was
`
`also found to be active against estrogen receptor-negative tumor cells
`
`as well.42 Emcyt® is marketed by Pfizer.
`
`• Ketoconazole – a broad-spectrum imidazole antifungal agent that
`
`interrupts the synthesis of an essential fungal membrane sterol.
`
`Ketoconazole has been shown to be a useful second-line treatment in
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`patients with advanced prostate cancer, but its use has been limited by
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`39 EX1062, http://chemocare.com/chemotherapy/drug-info/Mitoxantrone.aspx.
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`40 EX2154, Novantrone Gets FDA Nod, p. 1.
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`41 EX1041, Sartor deposition, February 13, 2017, pp. 288 - 289.
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`42 EX1063, http://chemocare.com/chemotherapy/drug-info/estramustine.aspx.
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`17
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`0019
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`concerns over its adverse effects (notably those on the liver). Recent
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`re-evaluation of the literature has suggested, however, that these
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`concerns have been overstated and that the most serious potential
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`adverse effects of ketoconazole can be avoided in most patients.43
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`B. U.S. Prescriptions and Sales of Prostate Cancer Drugs
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`24.
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`43 EX1064, http://www.medscape.com/viewarticle/406391.
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`18
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`0020
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`27.
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`VIII. Assessment of Commercial Success
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`28.
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`I understand that in evaluating the commercial success of a patented
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`product for the purposes of considering non-obviousness, courts often consider
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`whether there are “significant sales in a relevant market.”44 While there is no strict
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`quantitatve test to determine what constitutes “significant sales in a relevant
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`44 See Neupak, Inc. v. Ideal Mfg. & Sales Corp., 41 Fed. Appx. 435, 440 (Fed. Cir.
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`2002) (emphasis added) (“When a patentee demonstrates commercial success,
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`usually shown by significant sales in a relevant market…”), Ormco Corp. v. Align
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`Tech., Inc., 463 F. 3d 1299, 1311-1312 (Fed. Cir. 2006) (“When a patentee can
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`demonstrate commercial success, usually shown by significant sales in a relevant
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`market…”), and In re Youngblood, 1999 U.S. App. LEXIS 15024, at *24-27 (Fed.
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`Cir. 1999). (“Youngblood’s proof of unit sales…does not indicate whether the
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`numbers sold were a substantial quantity in the relevant market.”). Daiichi Sankyo
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`Co. v. Mylan Pharma., 2009 WL 2356879 at *63–64 (D.N.J. July 30, 2009)
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`(quoting Ecolochem, Inc. v. Southern Cal. Edison Co., 227 F.3d 1361, 1377
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`(Fed.Cir.2000) (“We have further held that a presumption arises that the patented
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`invention is commercially successful ‘when a patentee can demonstrate
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`commercial success, usually shown by significant sales in a relevant market’”).
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`19
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`0021
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`market,” it is my understanding that commercial success should be shown in a
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`market context rather than simply as a recounting of a company’s sales. For
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`example, courts have held that “evidence showing sale of a large number of goods
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`supposedly embodying the claimed invention does not necessarily demonstrate non-
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`obviousness.”45 Further, I understand that a decreasing sales trend weighs against a
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`finding of commercial success.46
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`29.
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`I understand that it is the patentee’s burden to provide evidence of
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`commercial success, and that there is no evidence of commercial success unless there
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`is a nexus between the sales of the patented product and novel elements of the
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`claimed invention.47 I also understand that the alleged success must be due to the
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`claimed features of the invention, rather than factors such as advertising, superior
`
`
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`45 Daiichi Sankyo Co. v. Mylan Pharma., 670 F. Supp. 2d 359, 384 (D.N.J. 2009).
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`46 Santarus, Inc. v. Par Pharma., Inc., 720 F.Supp.2d 427, 453, (D. Del. 2010)
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`(“Furthermore, Zegerid apparently was no longer showing signs of growth in the
`
`most recent quarters for which evidence was presented at trial.”).
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`47 In re Paulsen, 30 F.3d 1475, 1482 (Fed. Cir. 1994); see also Ormco, 463 F.3d at
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`1311-12.
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`
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`20
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`0022
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`workmanship, or other features within the commercialized technology.48 The United
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`States Court of Appeals, Federal Circuit (“CAFC”), has stated that “[e]vidence of
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`commercial success, or other secondary considerations, is only significant if there is
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`a nexus between the claimed invention and the commercial success.”49 The CAFC
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`
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`48 In re Paulsen, 30 F.3d 1475, 1482 (Fed. Cir. 1994); see also Ormco, 463 F.3d at
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`1311-12.
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`49 Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299, 1311-1312 (Fed. Cir. 2006)
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`(emphasis added); see also; In re Youngblood, 1999 U.S. App. LEXIS, at *24-27
`
`(citing Kansas Jack, Inc. v. Kuhn, 719 F.2d 1144, 1150-51 (Fed. Cir. 1983) (the
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`patentee must show a “nexus between sales and the merits of the invention.”);
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`Sjolund v. Musland, 847 F. 2d 1573, 1582 (Fed. Cir. 1988) (“Nor could the jury,
`
`from the bare evidence of units sold and gross receipts, draw the inference that the
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`popularity of the [sold units] was due to the merits of the invention.”); Friskit, Inc.
`
`v. Realnetworks, Inc., 306 Fed. Appx. 610, 617 (Fed. Cir. 2009) (commercial
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`success must be due to the “subject matter that [the patentee] contends is
`
`nonobvious”); J.T. Eaton & Co., Inc. v. Atlantic Paste & Glue Co., 106 F. 3d 1563,
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`1571 (Fed. Cir. 1997) (the commercial success must be “attributable to something
`
`disclosed in the patent that was not readily available in the prior art”).
`
`
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`21
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`0023
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`
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`has stated the following regarding evidence of commercial success:50
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`To establish a proper nexus between a claimed invention and the
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`commercial success of a product, a patent owner must offer “proof
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`that the sales were a direct result of the unique characteristics of the
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`claimed invention—as opposed to other economic and commercial
`
`factors unrelated to the quality of the patented subject matter.” In re
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`Huang, 100 F.3d 135, 140 (Fed. Cir. 1996). If a product both
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`“embodies the claimed features” and is “coextensive” with the claims
`
`at issue, “a nexus is presumed.” Brown & Williamson, 229 F.3d at
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`1130. In other words, a nexus exists if the commercial success of a
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`product is limited to the features of the claimed invention. But “if the
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`commercial success is due to an unclaimed feature of the device” or
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`“if the feature that creates the commercial success was known in the
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`prior art, the success is not pertinent.” Ormco Corp. v. Align
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`Technology, Inc., 463 F.3d 1299, 1312 (Fed. Cir. 2006).
`30. Federal District Courts have admitted evidence relating to the
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`contribution of other business factors, including the costs and profits of the
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`asserted patented products,51 as well as evidence showing that a product did not
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`meet sales expectations.52
`
`
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`50 SightSound Technologies, LLC v. Apple Inc., 809 F.3d 1307, 1319 (Fed. Cir.
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`2015) (emphasis added).
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`51 In re Cyclobenzaprine Hydrochloride Extended-Release Capsule Patent Litig.,
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`794 F. Supp. 2d 517, 538 (D. Del. 2011) (“It is uncontested that…costs exceeded
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`
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`22
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`0024
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`
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`31. Courts have also considered the applicability of other patents to a
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`product in evaluating commercial success arguments. For example, in Merck &
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`Co. v. Teva Pharmaceuticals USA, Inc.,53 the court concluded that the commercial
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`success of the drug at issue was of “minimal probative value” on the issue of
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`obviousness.54 According to the Merck Court, “[f]inancial success is not
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`significantly probative of [whether the claimed invention was non-obvious in light
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`of prior art] in this case because others were legally barred from commercially
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`testing the [relevant] ideas” by other patents claiming elements of the product.55
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`32. Similarly, in Senju Pharmaceuticals Co. v. Apotex, Inc.,56 the court
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`found that evidence of the commercial success of “ZYMAR®, the undisputed
`
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`sales by more than $55 million.”) rev’d on other grounds, 676 F.3d 1063, 1080-84
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`(Fed. Cir. 2012); Daiichi, 670 F. Supp. 2d at 386; Novartis Pharms. Corp. v. Teva
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`Pharms. USA, Inc., No. 5-CV-1887 (DMC), 2009 WL 3754170, at *17 (D.N.J.
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`Nov. 5, 2009).
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`52 Santarus, Inc. v. Par Pharm., Inc., 720 F. Supp. 2d 427, 454 (D. Del. 2010).
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`53 Merck & Co. v. Teva Pharms. USA, Inc., 395 F.3d 1364 (Fed. Cir. 2005).
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`54 Id. at 1376.
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`55 Id. at 1377.
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`56 717 F. Supp. 2d 404 (D. Del. 2010).
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`
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`23
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`0025
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`
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`commercial embodiment of the ′045 Patent” was of only “minimal probative
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`value,” because “others were legally barred from testing gatifloxacin products
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`until the pediatric exclusivity associated with [a different] patent expires.”57
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`IX. Analysis of the Tate Declaration and My Opinions
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`33.
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`In this section, I set forth my analysis of the Tate Declaration and my
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`conclusions regarding the alleged commercial success of Jevtana® in the context of a
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`non-obviousness analysis.
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`A. Jevtana® Usage-Based Market Shares Are Not Significant
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`1. Mr. Tate’s Indication-Based Relevant Market Definition Is Too
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`Narrow
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`34. The Tate Declaration states in part that, “Jevtana® was approved in
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`the U.S. by FDA on June 17, 2010 for use in combination with prednisone for the
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`treatment of patients with mCRPC previously treated with a docetaxel-containing
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`treatment regimen. Therefore, the relevant market for Jevtana® is mCRPC
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`patients who have progressed after being treated with docetaxel.”58
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`35.
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`57 Id. at 426.
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`58 EX2149, Tate Declaration, December 23, 2016, p. 10.
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`24
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`0026
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`37. Moreover, Mr. Tate’s Jevtana®-indication-based relevant market
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`definition is too narrow because it excludes product sales for which Jevtana®
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`competes, including sales of products with which Jevtana® competes for post-
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`docetaxel use. The FDA indication for Jevtana®, like all FDA indications, does not
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`
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`59 EX2149, Tate Declaration, December 23, 2016, p. 15 and Schedules 4.1 – 4.7;
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`EX2170, AlphaImpactRx Questionnaire, and EX2179, Underlying Data for
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`AlphaImpactRx Questionnaire.
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`60 EX2179, Underlying Data for AlphaImpactRx Questionnaire.
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`61 EX2149, Tate Declaration, December 23, 2016, Schedule 4.
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`
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`25
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`0027
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`define a market, but only identifies the situations in which Jevtana® has been
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`approved by the FDA for use. Although other prostate cancer drugs have
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`additional indications, many prostate cancer drugs compete for post-docetaxel
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`mCRPC prescriptions and sales, due to considerable off-label use. Similarly,
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`cabazitaxel competes for pre-docetaxel mCRP
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