`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`BRECKENRIDGE PHARMACEUTICAL, INC.
`Petitioner,
`
`v.
`
`RESEARCH CORPORATION TECHNOLOGIES, INC.,
`Patent Owner.
`
`Case No. IPR2016-01242
`Patent No. RE 38,551
`
`
`
`
`
`
`
`
`
`
`
`
`
`PATENT OWNER ABBREVIATED PRELIMINARY RESPONSE AND
`OPPOSITION TO PETITIONER’S MOTION FOR JOINDER
`
`
`
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`Patent Owner Research Corporation Technologies, Inc. (“Patent Owner”)
`
`provides the following abbreviated preliminary response to the petition filed by
`
`Breckenridge Pharmaceutical, Inc. (“Petitioner” or “Breckenridge”) on June 21,
`
`2016, and opposition to Breckenridge’s accompanying motion requesting joinder
`
`to Grounds 3A and 3B of IPR2016-00204 (“the Argentum proceeding”).
`
`The Federal Circuit’s decision in Magnum Oil—issued after the decision to
`
`institute the Argentum proceeding—coupled with the also recent Federal Circuit
`
`Intelligent Bio-Systems decision, make clear that a petitioner must present its
`
`evidence in its petition, and that the failures of a petition cannot be cured through a
`
`reply paper. Here, Breckenridge’s Petition is “substantially identical” to the
`
`Argentum petition, and in any event, Breckenridge, if joined, would be limited to
`
`the evidence and arguments presented in the Argentum petition. See Sections I and
`
`IV, infra. This evidence fails to show the unpatentability of any claim of the ’551
`
`patent. Because such deficiencies cannot be cured, the Board should deny
`
`Breckenridge’s Petition and accompanying Motion for Joinder. See 35 U.S.C.
`
`§ 315(c).
`
`1
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`I.
`
`The Petition Should Be Denied as to Grounds 1A, 1B, 2A, 2B, 4A, and
`4B
`
`Patent Owner hereby
`
`incorporates by reference1
`
`its Patent Owner
`
`Preliminary Response in IPR2016-00204, which addressed the failure of the
`
`petition in that proceeding to establish a reasonable likelihood that any claim of the
`
`’551 patent is unpatentable, under any of the enumerated Grounds. See IPR2016-
`
`00204, Paper 9. In a decision instituting inter partes review as to Grounds 3A and
`
`3B, the Board found that Argentum’s petition had not established a reasonable
`
`likelihood that any claim of the ’551 patent was unpatentable under Grounds 1A,
`
`1B, 2A, 2B, 4A or 4B. See IPR2016-00204, Paper 19 at 22–23. Breckenridge’s
`
`Petition is “substantially identical” to Argentum’s petition in IPR2016-00204 (see
`
`Pet. (Paper 1) at 7), which the Board has already found deficient as to Grounds 1A,
`
`1B, 2A, 2B, 4A and 4B (see IPR2016-00204, Paper 19 at 8–12, 22–23; Paper 4 at
`
`
`1 As explained in the Board’s August 11, 2016 Order (Paper 7), the Board has
`
`authorized Patent Owner to incorporate by reference arguments and information in
`
`its Patent Owner Preliminary Response and in the Board’s Decision on Institution
`
`from the Argentum proceeding (i.e., Papers 9 and 19 in IPR2016-00204). See
`
`Paper 7 at 4; Ex. 2001 at 33:9–15.
`
`2
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`4).2 For the same reasons why the Board denied Argentum’s petition as to Grounds
`
`1A, 1B, 2A, 2B, 4A and 4B, Breckenridge’s Petition should be denied here as to
`
`those same grounds. See IPR2016-00204, Paper 19 at 8–12, 22–23.
`
`II. The Petition Fails to Establish a Reasonable Likelihood that the Claims
`Are Unpatentable Under Grounds 3A or 3B
`A.
`
`Intervening Case Law Clarifies Petitioner’s Burden to
`Present Evidence of Unpatentability in Its Petition
`
`Subsequent to the Board’s May 23, 2016 decision to institute the Argentum
`
`proceeding, the Federal Circuit clarified that “it is inappropriate to shift the burden
`
`to the patentee after institution to prove that the patent is patentable,” and that “the
`
`petitioner continues to bear the burden of proving unpatentability after institution.”
`
`In Re: Magnum Oil Tools Int’l, Ltd., __ F.3d __, 2016 WL 3974202, at *7 (Fed.
`
`Cir. 2016). Prior to Magnum Oil, it was unclear whether the burden of production
`
`may shift to the patent owner post-institution, to come forward with evidence of
`
`patentability. See Dynamic Drinkware, LLC v. Nat’l Graphics, Inc., 800 F.3d 1375,
`
`1379 (Fed. Cir. 2015) (noting that the burden of production may shift from the
`
`patent challenger to the patentee, in the context of establishing conception and
`
`
`2 In any event, if Breckenridge—an otherwise time-barred party (Ex. 2001, 7:18–
`
`8:5)—is joined to the Argentum proceeding, Breckenridge will be limited to the
`
`evidence and arguments in the Argentum petition. See Section IV, infra.
`
`3
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`reduction to practice). Magnum Oil resolved this question, rejecting the notion
`
`“that the burden of production shifts to the patentee upon the Board’s conclusion in
`
`an institution decision that ‘there is a reasonable likelihood that the petitioner
`
`would prevail.’” Magnum Oil, 2016 WL 3974202, at *6. Thus, both the burdens of
`
`persuasion and production to show unpatentability remain with the petitioner and
`
`do not shift to the patent owner at any time. See id. at *6–*8.
`
`This un-shifting burden of proof—a burden that remains with the petitioner
`
`throughout the proceeding—is particularly significant in light of additional recent
`
`Federal Circuit law, holding that “the expedited nature of IPRs bring[s] with it an
`
`obligation for petitioners to make their case in their petition to institute,” which
`
`must “identify ‘with particularity’ the ‘evidence that supports the grounds for the
`
`challenge to each claim.’” Intelligent Bio-Systems, Inc. v. Illumina Cambridge Ltd.,
`
`821 F.3d 1359, 1369 (Fed. Cir. 2016) (emphases added); see also id. at 1369–70
`
`(concluding petitioner’s reply brief and accompanying declaration were improper
`
`under 37 C.F.R. § 42.23(b) because petitioner “relied on an entirely new rationale”
`
`in its reply to explain motivation to combine). Thus, because a petitioner must both
`
`provide its evidence and make its case in its petition,3 and because the burdens of
`
`
`3 The Federal Circuit’s decision in Genzyme is not to the contrary. While the
`
`Federal Circuit in Genzyme observed that “the introduction of new evidence in the
`
`
`
`4
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`production and persuasion never shift to the patent owner, a petitioner’s failure to
`
`include key evidence in its petition is irremediable and cannot be cured through a
`
`reply paper.
`
`For example, as explained further below, the prior art on which Petitioner
`
`relies in Grounds 3A and 3B fails to disclose a “therapeutic composition” as
`
`construed by the Board, and as required by claim 10 of the ’551 patent. Because
`
`the burden of production never shifts from the Petitioner, as the Federal Circuit has
`
`now made clear (Magnum Oil, 2016 WL 3974202, at *6–*8), and because
`
`Petitioner cannot cure its failure of proof in its Reply (Intelligent Bio-Systems, 821
`
`F.3d at 1369), it is clear at this stage that Petitioner has not—and cannot—meet its
`
`burden of proving unpatentability of the claims.
`
`
`course of the trial is to be expected in inter partes review trial proceedings,” the
`
`“new evidence” cited in the reply in Genzyme had been cited in the petition and
`
`was already part of the record. See Genzyme Therapeutic Products Ltd.
`
`Partnership v. Biomarin Pharm. Inc., __ F.3d __ (Fed. Cir. 2016), 2016 WL
`
`3254734, at *5. In addition, the Board did not rely on that evidence to establish any
`
`claim limitations, or to fill in any gaps in the petition. See id. at *6.
`
`5
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`B.
`
`Petitioner Fails to Present Evidence Showing that the
`Claims Are Unpatentable
`
`Petitioner fails to present evidence to meet its burden of showing
`
`unpatentability of claims 1–9 over Kohn 1991 and Silverman. In the first instance,
`
`Petitioner fails to provide evidence showing that a POSA4 would have selected any
`
`functionalized amino acid (“FAA”) as a lead compound, much less selected
`
`Compound 3l in Kohn 1991 over other FAAs, including similarly potent FAAs,5
`
`given Compound 3l’s “synthetic and stability issues.” See Pet. at 57–58; IPR2016-
`
`00204, Paper 9 at 27–31 (discussing lead compound selection), 46 (discussing the
`
`problems with Compound 3l). Petitioner further fails to provide evidence showing
`
`that a POSA would have been motivated to modify Compound 3l in the way
`
`Petitioner suggests, given that a POSA would have known that similar
`
`modifications in FAAs resulted in a reduction in activity; Petitioner similarly fails
`
`to provide evidence to show that a POSA would have had a reasonable expectation
`
`of success in making such modification. See Pet. at 58–59; IPR2016-00204, Paper
`
`
`4 Patent Owner incorporates by reference its description of the level of ordinary
`
`skill in the art from its Preliminary Response in the Argentum proceeding. See
`
`IPR2016-00204, Paper 9 at 9. However, regardless of the definition, the
`
`conclusions regarding insufficient evidence remain the same.
`
`5 See, e.g., Compound 3n in Kohn 1991 (Ex. 1012), Table 1.
`
`6
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`9 at 47–49. Petitioner cannot cure any of these failures in its reply paper. Thus
`
`Petitioner has not—and cannot—meet its burden with respect to claims 1–9.6
`
`With respect to claim 10, the only basis appearing for Petitioner’s Ground
`
`3B assertion that claim 10 is obvious over Kohn 1991, Silverman, and the ’729
`
`patent, is the “rationales and prior art disclosures discussed in Ground 1B,” where
`
`Ground 1B concerns patentability over the LeGall Thesis together with the ’729
`
`patent. See Pet. at 61. Petitioner’s Ground 1B arguments are therefore directed to a
`
`
`6 Importantly, a recent judicial opinion confirmed the non-obviousness of
`
`lacosamide (the compound of claim 8) over Kohn 1991 Compound 3l. See UCB,
`
`Inc. et al. v. Accord Healthcare, Inc. et al., 1:13-cv-01206-LPS, Dkt. 313 (D. Del.)
`
`(Ex. 2003). The district court found that (1) “a POSA would not have selected any
`
`FAA as a lead compound,” and (2) “[e]ven if, contrary to the evidence, a POSA
`
`would have selected a nonaromatic FAA as a lead compound, such a person would
`
`not have selected compound 3l.” Id. at 84–88 (emphasis in original). The Court
`
`also found that (3) a POSA would not “have been motivated to change the
`
`NHOC[H]3 of compound 3l to the CH2OCH3 of lacosamide,” and (4) “a POSA
`
`would not have had a reasonable expectation of success from substituting an amine
`
`for a methylene in compound 3l.” Id. at 88–89; see Pet. at 58–59 (discussing
`
`modifying the NHOCH3 of compound 3l to the CH2OCH3 of lacosamide).
`
`7
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`different reference that is not at issue here.7 In any event, Petitioner fails to show
`
`that claim 10—which claims a “therapeutic composition”—is unpatentable.
`
`Critically, Petitioner fails to show any disclosure of a “therapeutic
`
`composition” in the ’729 patent or in any other prior art reference. In the Argentum
`
`proceeding, the Board found “therapeutic composition” to be a limitation of claim
`
`10 and construed this term as a composition “suitable for use as a treatment
`
`regimen over an extended period of time (chronic administration).” IPR2016-
`
`00204, Paper 19 at 7–8. This construction is also the construction adopted by the
`
`district court in the consolidated Delaware litigation, in which Petitioner was a
`
`named defendant. UCB, Inc., et al. v. Accord Healthcare, Inc., et al., No. 13-1206
`
`(LPS), Dkt. 240 (D. Del.).
`
`Petitioner was fully aware of the consistent construction of this claim term
`
`by both the Board and the district court when it filed its Petition. Indeed, in its
`
`
`7 The Argentum petition failed to establish that the LeGall Thesis is a printed
`
`publication. See IPR2016-00204, Paper 19 at 8–12. Because the Petition here is
`
`“substantially identical” to Argentum’s petition in IPR2016-00204 (see Pet. at 1),
`
`and because, in any event, Petitioner is limited to solely those arguments and
`
`evidence in the Argentum petition (see Section IV, infra), Petitioner likewise fails
`
`to meet its burden to establish that the LeGall Thesis is a printed publication.
`
`8
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`Petition, Petitioner repeatedly refers to the district court’s construction and argues
`
`against it. See Pet. at 18–20; see also Ex. 1007 (Petitioner’s exhibit providing the
`
`district court’s claim construction order). Nonetheless, Petitioner fails to provide
`
`any evidence that Kohn 1991, Silverman, and the ’729 patent teach or suggest a
`
`“therapeutic composition” as construed. Petitioner fails to provide any evidence
`
`because no such evidence existed in the prior art.
`
`Petitioner’s allegation that “Claim 10 is obvious because a POSA knew to
`
`use an effective amount of the active agent and also to use a pharmaceutical
`
`carrier” (Pet. at 41 (Ground 1B)) is insufficient and beside the point—nowhere
`
`does the Petition explain how the combination of Kohn 1991, Silverman, and the
`
`’729 patent meet the therapeutic composition limitation of claim 10 as construed.
`
`Petitioner fails to address this key limitation of claim 10—which requires that the
`
`composition be “suitable for use as a treatment regimen over an extended period of
`
`time (chronic administration)”—and thus its patentability challenge should be
`
`rejected.
`
`Petitioner’s patentability challenge should be rejected for the separate reason
`
`that Petitioner has not shown that a POSA would have reasonably expected to
`
`achieve a therapeutic composition—i.e., a composition “suitable for use as a
`
`treatment regimen over an extended period of time (chronic administration)”—of
`
`any of the compounds of claims 1–9, or of any FAA. A finding of obviousness
`
`9
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`requires “not only the existence of a motivation to combine elements from
`
`different prior art references, but also that a skilled artisan would have perceived a
`
`reasonable expectation of success in making the invention via that combination.”
`
`Medichem, S.A. v. Rolabo, S.L., 437 F.3d 1157, 1165 (Fed. Cir. 2006) (emphasis
`
`added). No liver toxicity data, which would indicate to a POSA whether a
`
`composition is suitable for chronic administration, appeared in the prior art for any
`
`FAA, let alone any of the compounds of claims 1–9. See Ex. 2002, 178:4–9.8 Thus,
`
`a POSA would not have had any data on which to base an expectation regarding
`
`suitability for chronic administration as to FAAs generally, or the compounds of
`
`claims 1–9 specifically. Indeed, liver toxicity data for lacosamide (the compound
`
`of claim 8, also known as (R)-N-benzyl-2-acetamido-3-methoxypropionamide, and
`
`referred to in the ’551 patent as “BAMP” (see Ex. 1001, 24:56–58)) was disclosed
`
`for the first time in the ’551 patent.9 See Ex. 1001, 25:44–29:36; Ex. 2002, 178:4–9
`
`
`8 See IPR2016-00204, Paper 9 at 2–3 n.2.
`
`9 With respect to “therapeutic composition,” the district court (see note 6, supra)
`
`noted that its construction of this claim term—the same construction adopted by
`
`the Board in the Argentum proceeding—“presupposes that the compound will not
`
`result in liver toxicity.” Ex. 2003 at 64 n.19. “A medicine is not suitable for
`
`chronic administration if it will be toxic to the liver.” Id.
`
`10
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`(Dr. Heathcock’s testimony that no liver toxicity data for any FAA was disclosed
`
`in any prior art to the ’551 patent).
`
`In sum, Petitioner has failed to provide any evidence whatsoever in its
`
`Petition of a “therapeutic composition”—which is required by claim 10—in the
`
`prior art. In addition, as explained in the Patent Owner Preliminary Response (see,
`
`e.g., IPR2016-00204, Paper 9 at 46–50), Petitioner has also failed to provide any
`
`evidence that a POSA would have reasonably expected to achieve the compounds
`
`of claims 1–9, much less a “therapeutic composition” of any of these compounds.
`
`Petitioner has likewise failed to provide any evidence that a POSA would have
`
`reasonably expected to achieve a method of treating using these compounds, as
`
`recited in claims 11–13. Each of these failures shows that Petitioner has not met its
`
`initial burden to show a reasonable likelihood of unpatentability of the claims of
`
`the ’551 patent, and that Petitioner cannot meet its ultimate burden to show
`
`unpatentability by a preponderance of the evidence. See Intelligent Bio-Systems,
`
`821 F.3d at 1369–70 (new theory of invalidity supported by new evidence not
`
`present in the petition cannot be presented for the first time in reply). Accordingly,
`
`the Board should deny the present Petition.
`
`III. Petitioner’s Motion for Joinder Should Be Denied
`Joinder requires, “as an initial matter, a determination that the petition
`
`accompanying the joinder motion warrants institution of review.” Lupin Ltd., et al.
`
`11
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`v. Senju Pharmaceutical Co., Ltd., IPR2015-01871, Paper 13 at 2 (P.T.A.B. Jan.
`
`25, 2016) (discussing 35 U.S.C. § 315(c)). The decision whether to grant joinder is
`
`discretionary. 35 U.S.C. § 315(c); 37 C.F.R. § 42.122. “The Board will determine
`
`whether to grant joinder on a case-by-case basis, taking into account the particular
`
`facts of each case, substantive and procedural issues, and other considerations.”
`
`Macronix Int’l Co., Ltd. v. Spansion LLC, IPR2014-00898, Paper 15 at 3 (P.T.A.B.
`
`Aug. 13, 2014). Here, because Petitioner has failed to establish in its Petition a
`
`reasonable likelihood that the claims are unpatentable, joinder is improper, and
`
`Petitioner’s motion to join the Argentum proceeding should be denied.
`
`IV.
`
`If the Board Grants Petitioner’s Motion for Joinder, Petitioner Is
`Limited to an Understudy Role, and Its Evidence Is Limited to the
`Evidence in the Argentum Petition
`
`If the Board grants Petitioner’s motion to join the Argentum proceeding,
`
`Petitioner is limited to an “understudy” role, and is limited to the evidence and
`
`arguments presented in the Argentum petition. See Paper 7 at 2; Ex. 2001 at 10:4–
`
`11:11 (Petitioner agreeing to take an understudy role, such that it would not take its
`
`own depositions, be filing papers separate from Argentum, or making arguments
`
`separate from Argentum), 15:6–16:13 (Petitioner agreeing to be “a true me-too”
`
`petitioner), 17:16–18:7 (Board explaining that the joined petitioners, including
`
`Petitioner Breckenridge, “will be relying on all evidence and arguments that were
`
`made in [the Argentum] petition”). Petitioner may not seek “(a) additional briefing
`
`12
`
`
`
`Patent No. RE 38,551
`
`
`
`Case No. IPR2016-01242
`
`
`
`or pages, (b) to submit new evidence, such as declaration testimony, (c) additional
`
`time for cross-examination of witness or time during an oral hearing, or (d) to alter
`
`the trial schedule” set out in the scheduling order or otherwise agreed to during
`
`trial in the Argentum proceeding. Paper 7 at 2. In other words, Petitioner is limited
`
`to the arguments and evidence that were presented in the Argentum petition, and
`
`may not rely on any additional evidence or expert testimony, including any such
`
`additional evidence or testimony presented in its Petition or Motion for Joinder.
`
`Paper 7 at 3 (“[T]he later Petitioners . . . agreed to assert arguments and evidence
`
`of record in IPR2016-00204 only, and not [to] rely on any additional evidence
`
`raised in Petitions or Motions for Joinder filed by the later Petitioners.”); Ex. 2001
`
`at 15:6–16:13, 17:16–18:7.
`
`V. Conclusion
`For the reasons discussed above, Federal Circuit case law now makes clear
`
`that the Petition’s deficiencies cannot be cured by a reply paper. Because Petitioner
`
`Breckenridge’s Petition fails to provide evidence showing the unpatentability of
`
`any claim of the ’551 patent, and because such deficiencies cannot be cured,
`
`Breckenridge’s Petition and its accompanying Motion for Joinder should be
`
`denied. However, should the Board grant Petitioner Breckenridge’s Motion for
`
`Joinder, the parties and the Board have agreed that Petitioner will be limited to an
`
`13
`
`
`
`Patent No. RE 38,551
`
`Case No. 1PR2016—01242
`
`understudy role, and to only the evidence and arguments presented in the
`
`Argentum petition.
`
`Date: August 19, 2016
`
`Respectfully submitted,
`
`By
`
`flé
`
`drea G. Reister
`
`Registration No. 36,253
`Jennifer L. Robbins
`
`Registration No. 61,163
`COVINGTON & BURLING LLP
`
`One CityCenter, 850 Tenth Street, NW
`Washington, DC 20001
`(202) 662-6000
`Attorneys for Patent Owner
`
`
`
`CERTIFICATE OF SERVICE
`
`Pursuant to 37 C.F.R. § 42.6, I hereby certify that on this 19th day of August
`
`2016,
`
`the foregoing Patent Owner Abbreviated Preliminary Response and
`
`Opposition to Petitioner’s Motion for Joinder was served by electronic mail, by
`
`agreement of the parties, on the following counsel of record for Petitioner.
`
`Matthew L. Fedowitz (mfedowitz@merchantgould.com)
`Daniel R. Evans (devans@merchantgould.com)
`Merchant & Gould P.C.
`
`1900 Duke Street, Suite 600
`Alexandria, VA 22314
`
`Date: August 19, 2016
`
`nnifer L. Robbins, Esq.
`Registration No.: 61,163