IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`
`MYLAN PHARMACEUTICALS, INC.,
`Petitioner,
`
`v.
`
`JANSSEN ONCOLOGY, INC.,
`Patent Owner.
`
`Case No. IPR2016-01332
`U.S. Patent No. 8,822,438 B2
`
`DECLARATION OF
`CHRISTOPHER A. VELLTURO, PH.D.
`IN SUPPORT OF PATENT OWNER RESPONSE
`
`
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`PROTECTIVE ORDER MATERIAL
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`JANSSEN EXHIBIT 2115
`Mylan v. Janssen IPR2016-01332
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`Table of Contents
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`
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`Page(s)
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`I.
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`INTRODUCTION AND SUMMARY ........................................................... 1
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`A. Qualifications and Experience ............................................................. 2
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`B.
`
`C.
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`Evidence Considered ............................................................................ 3
`
`Summary of Opinions .......................................................................... 3
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`II.
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`BACKGROUND ............................................................................................ 6
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`A.
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`B.
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`C.
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`D.
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`Prostate Cancer ..................................................................................... 6
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`Demand for mCRPC Treatment ........................................................... 7
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`ZYTIGA® ............................................................................................ 9
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`The Patent-at-Issue ............................................................................... 9
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`III. CONSIDERATION OF The Hofmann DECLARATION ........................... 10
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`A. Overview of Mr. Hofmann’s Contentions ......................................... 11
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`B.
`
`The ’213 Patent as a Purported “Blocking Patent” Does Not
`Negate a Commercial Success Assessment ....................................... 13
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`1.
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`2.
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`Overview .................................................................................. 13
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`Development and License Attempts of Abiraterone
`Acetate...................................................................................... 14
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`C. Mr. Hofmann’s Assessment of Nexus is Incomplete ......................... 18
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`D. Mr. Hofmann’s Mischaracterization of ZYTIGA®’s
`Marketplace Performance .................................................................. 21
`
`IV. AFFIRMATIVE ASSESSMENT ................................................................. 24
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`A.
`
`B.
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`Evaluation of Marketplace Success ................................................... 25
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`ZYTIGA®’s Commercial Success Is Due in Significant Part to
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`PROTECTIVE ORDER MATERIAL
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`the Claims of the ’438 Patent ............................................................. 29
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`1.
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`2.
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`3.
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`4.
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`The ’438 Patent Covers the Only FDA-Approved Use of
`ZYTIGA® ................................................................................ 30
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`Physicians Value ZYTIGA® – The Combination of
`Abiraterone Acetate and Prednisone – for its Therapeutic
`Survival Benefit ....................................................................... 30
`
`ZYTIGA®’s Commercial Success Is Not Attributable to
`Excessive Marketing Spend Levels ......................................... 35
`
`ZYTIGA®’s Commercial Success Is Not Due to
`Aggressively Low Pricing ........................................................ 36
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`V.
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`CONCLUSION ............................................................................................. 37
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`I.
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`I, Christopher A. Vellturo, hereby declare and state as follows:
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`INTRODUCTION AND SUMMARY
`1.
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`I have been retained as a consultant on behalf of Janssen Oncology, Inc.
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`
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`(“Janssen”), the patent owner in the present proceeding. I understand that the
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`petition names Mylan Pharmaceuticals, Inc. (“Mylan” or “petitioner”). I have no
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`financial interest in, or affiliation with, the petitioner or the patent owner.
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`Quantitative Economic Solutions, LLC, a consulting firm of which I am the founder
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`and president, is being compensated for my work at my usual and customary hourly
`
`consulting rate of $850.1 QES’s compensation is not dependent upon the outcome
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`of, or my testimony in, the present inter partes review or any litigation proceedings.
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`2.
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`I have been asked to evaluate the analyses and conclusions put forth on
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`behalf of the petitioner by Ivan T. Hofmann in his declaration (“the Hofmann
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`Declaration”).2 I have also been asked to independently evaluate the commercial
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`success of the combination therapy of abiraterone acetate and prednisone – marketed
`
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`1 QES is also compensated for the time spent on this matter by persons working at
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`my direction. Those rates are lower than my hourly rate.
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`2 Declaration of Ivan T. Hofmann, CPA/CFF, CLP, June 30, 2016 (Ex. 1017).
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`by Janssen as ZYTIGA®3 – and the extent to which ZYTIGA®’s commercial
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`success is causally linked to the patent claims in U.S. Patent No. 8,822,438 B2 (“the
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`’438 patent” or the “Patent-at-Issue”).
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`A. Qualifications and Experience
`3. My qualifications and experience relevant to the issues in this
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`proceeding are summarized below. My curriculum vitae is submitted herewith as
`
`Exhibit 2045.
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`4.
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`I am the founder and president of Quantitative Economic Solutions,
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`LLC, a microeconomic consulting firm. I received a Doctor of Philosophy degree
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`(Ph.D.) in Economics from the Massachusetts Institute of Technology in Cambridge,
`
`Massachusetts in 1989. My fields of specialization include industrial organization
`
`and econometrics.
`
`5.
`
`I have extensive experience in the valuation of intellectual property and
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`in the assessment of economic injury/damages sustained as a result of copyright,
`
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`3 As used herein, unless otherwise stated, the term “ZYTIGA®” refers to
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`ZYTIGA® therapy, i.e., abiraterone acetate in combination with prednisone for the
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`treatment of patients with metastatic castration-resistant prostate cancer. (See Ex.
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`1065.)
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`trademark, and/or patent infringement. Industries that I have studied in this context
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`include: pharmaceutical products, over-the-counter medications and instruments,
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`medical devices, consumer products, computer hardware and software, and
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`semiconductors. I have also evaluated pharmaceutical patent issues in the context
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`of commercial success and injunctive relief considerations on numerous occasions.
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`I have been qualified and have testified as an expert in many Federal Courts
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`throughout the United States as an expert in economics, statistics, survey design and
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`implementation, as well as an expert specifically in the economics of the
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`pharmaceutical industry.
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`B.
`6.
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`Evidence Considered
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`I have reviewed and relied on the articles and other documents and data
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`cited in this declaration. The specific documents I have reviewed are listed in
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`Appendix A of my declaration.
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`C.
`7.
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`Summary of Opinions
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`I have reviewed Mr. Hofmann’s assessment of commercial success of
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`ZYTIGA® as it relates to the ’438 patent. At no point does Mr. Hofmann conclude
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`that ZYTIGA®’s marketplace performance does not constitute a commercial
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`success – rather Mr. Hofmann contends that ZYTIGA®’s performance “does not
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`provide objective indicia of nonobviousness of the ’438 patent” because of other
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`factors.
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`8. Mr. Hofmann’s declaration reflects a mischaracterization of the
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`evidence regarding the marketplace success of ZYTIGA®, and a misapplication of
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`economic principles underlying a nexus consideration with respect to the ’438
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`patent. Specifically, I find:
`
` Mr. Hofmann’s opinion that the prior existence of IP relating to abiraterone
`acetate (specifically, U.S. Patent No. 5,604,213, “the ’213 patent”) represented
`a “blocking patent” issue that would have deterred investment in further
`development efforts by others to discover inventions claimed by the ’438 patent
`is superficial; when fully investigated, his claim is rejected because licensing
`rights from the ’213 patent owner were available for abiraterone acetate for
`substantial periods of time in the relevant period;
`
` Mr. Hofmann’s series of scientific assertions – primarily based on
`understandings received from petitioner’s expert Dr. Marc. B. Garnick, are
`incomplete in light of additional opinions put forth by Janssen’s expert, Dr.
`Matthew Rettig. Further, none of Mr. Hofmann’s assertions preclude a finding
`of nexus to the ’438 patent from an economic perspective;
`
` Mr. Hofmann does not conclude that ZYTIGA® is not a commercial success,
`though he does mischaracterize the available evidence in an attempt to
`deemphasize the extent of ZYTIGA®’s commercial success:
`
` Mr. Hofmann’s attempts to temper the significance of the substantial net
`sales and associated shares of sales of ZYTIGA® – a blockbuster drug –
`establish an untenable standard of commercial success that few drugs would
`meet; and
`
` Mr. Hofmann’s analysis relies on a list of the top 50 drugs in the world – this
`list includes ZYTIGA®, thereby highlighting ZYTIGA®’s success.
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`9.
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`I have undertaken an assessment of the degree of commercial success
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`realized by ZYTIGA® and evaluated the question regarding the nexus between such
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`success and the inventions covered by the claims of the ’438 patent. Based on the
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`evidence available to me, I conclude:
`
` ZYTIGA® has been commercially successful:
`
` ZYTIGA® has generated more than $4.5 billion in U.S. net sales from the
`time of its launch through 2016;
`
` In both 2015 and 2016, ZYTIGA®’s U.S. net sales topped $1 billion – a
`level commonly referred to “blockbuster drug” status;
`
` ZYTIGA®’s U.S. net sales have increased each year since its launch despite
`entry of competitor drugs used to treat mCRPC;
`
` Per Janssen’s historical share assessment methodology, the share of all
`mCRPC patients treated with ZYTIGA® stabilized above 25% – a
`considerable share of a multi-billion-dollar marketplace – in 2015 and 2016;
`per Janssen’s current share assessment methodology, ZYTIGA®’s share is
`even higher – more than 30% in 2015 and 2016.
`
` The commercial success of ZYTIGA® is due in significant part to use of a
`therapeutically effective amount of abiraterone acetate in combination with a
`therapeutically effective amount of prednisone for prostate cancer treatment –
`use that I understand embodies the claims of the ’438 patent:
`
` The only FDA-approved indication of ZYTIGA® calls for use of
`abiraterone acetate in combination with prednisone – use that I understand is
`covered by the claims of the ’438 patent;
`
` The considerable majority of ZYTIGA® use – indeed, use associated with
`between at least 87 and 93 percent of ZYTIGA® patients – is in
`combination with prednisone for the treatment of prostate cancer – use that I
`understand is covered by the claims of the ’438 patent;
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` Physicians value treatment using the combination of abiraterone acetate and
`prednisone for its anti-tumor benefits related to patients’ increased life
`expectancy (survival);
`
` ZYTIGA®’s observed expansion of net sales in the U.S. comes despite
`certain associated concerns related to tolerability associated with the use of
`prednisone – this is probative of the benefits the combination treatment of
`abiraterone acetate and prednisone provides to patients;
`
` ZYTIGA®’s commercial success is not due to exceptional levels of
`promotional expenditure nor is it attributable to aggressive or low prices.
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`10. This declaration and the opinions expressed herein are based on my
`
`analysis of the information I have considered to date. I may supplement, refine, or
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`revise my analysis as appropriate if additional testimony, documents or other
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`discovery materials become available.
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`II. BACKGROUND
`11. To provide an economic perspective for this action, I first provide
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`background on the condition that ZYTIGA® is used to treat – namely prostate
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`cancer. I then discuss factors affecting demand and supply for drugs used to treat
`
`prostate cancer. Finally, I discuss the Patent-at-Issue and my understanding of the
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`inventions it covers.
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`A.
`Prostate Cancer
`12. Prostate cancer is a form of cancer that develops in the prostate gland, a
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`male organ that produces the seminal fluid that nourishes and transports sperm in
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`the human body. (See Ex. 2098.) Its cells rely on testosterone, a male androgen or
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`hormone, to grow. Prostate cancer is the most common non-skin cancer to occur in
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`American males. (See Ex. 2100.)
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`13. Castration-resistant prostate cancer (“CRPC”) refers to the disease state
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`in which prostate cancer continues to grow, despite use of drugs to lower male
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`androgen levels. (See Ex. 2099.) CRPC is evidenced by either a continuous rise in
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`prostate-specific antigen (“PSA”) levels, pre-existing disease progression, and/or the
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`appearance of new metastases.4 (See Ex. 2109 at S72.) Metastatic castration-
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`resistant prostate cancer (“mCRPC”) refers to CRPC that has then metastasized (i.e.,
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`spread) to other parts of the body. (See Ex. 2099.) mCRPC patients’ cancer has
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`progressed and spread beyond the prostate gland, despite previous treatment to lower
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`testosterone levels. (See Ex. 1051 at 2.)
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`B. Demand for mCRPC Treatment
`14. The major participants in prescribing decisions for prostate cancer,
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`including CRPC and mCRPC, are healthcare professionals and their patients. The
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`primary treating physicians for patients with prostate cancer are typically either
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`urologists or oncologists. Physicians classify individuals with prostate cancer as
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`4 “Metastases” refers to the process by which cancer cells spread into normal tissue
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`in other parts of the body. (See, e.g., Ex. 2105.)
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`either pre-chemotherapy (chemo-naïve) patients or chemo-refractory patients. Pre-
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`chemotherapy patients have not yet undergone a chemotherapy treatment for
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`prostate cancer.
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` Chemo-refractory patients have received chemotherapy
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`treatment(s) for prostate cancer that were either partially or fully ineffective. (See
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`Ex. 2103.)
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`15.
`
`In general, the effective treatment of a given condition or disorder is a
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`fundamental factor affecting prescribing decisions. I understand from Patent
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`Owner’s expert, Dr. Matthew Rettig, that in the case of mCRPC, both treating
`
`physicians and patients evaluate anti-tumor effects as the key treatment attribute to
`
`consider. Further, in the realm of mCRPC drug development, the primary emphasis
`
`is the improvement in the patient’s life expectancy (i.e., survival), which is a goal of
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`clinicians, researchers, and patients. Physicians and patients evaluate efficacy of
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`mCRPC treatments based upon survival; while a patient’s level of prostate-specific
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`antigen (“PSA”) and radiographic responses are important, the ultimate objective is
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`to improve survival with treatment. (See Ex. 2038 (Rettig Dec.) ¶¶ 68, 218.)
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`16. Certain therapies used to treat mCRPC – including ZYTIGA® – are
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`indicated for use in combination with prednisone. (See Ex. 1065.) Prednisone is in
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`the class of drugs known as glucocorticoids, which work to mimic the effects of
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`naturally-produced hormones in the human body. (See Ex. 2102.)
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`C. ZYTIGA®
`17.
`I understand from Dr. Rettig that in the 2004 – 2010 time period,
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`chemotherapy treatment, commonly using the drug docetaxel (which is marketed as
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`Taxotere), was the only mCRPC treatment that was associated with modest
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`improvements in survival rates of mCRPC patients.5
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`18. Abiraterone acetate was approved by the FDA on April 28, 2011, and is
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`marketed by Janssen in combination with prednisone, as per its FDA-approved use,
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`as ZYTIGA®. (See Ex. 1047.) ZYTIGA® was initially indicated for the treatment
`
`of patients with mCRPC who have received prior chemotherapy containing
`
`docetaxel. (See Ex. 1018.) On December 10, 2012, ZYTIGA®’s indication was
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`modified to include treatment of patients with mCRPC regardless of prior docetaxel
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`treatment. It is available as an oral tablet at a recommended dose of 1,000 mg (taken
`
`in four 250 mg tablets) administered orally once daily; it is to be taken in
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`combination with prednisone (5 mg), administered twice daily. (Ex. 1065.)
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`D. The Patent-at-Issue
`19.
`I understand the Patent-at-Issue is U.S. Patent No. 8,822,438 (“the ’438
`
`patent”), which issued on September 2, 2014. (Ex. 1001.) I further understand based
`
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`5 Conversation with Dr. Matthew Rettig, September 28, 2016; see also Ex. 2104.
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`on my conversation with Dr. Matthew Rettig that the ’438 patent covers a method
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`for treating prostate cancer by the administration of a therapeutically effective
`
`amount of abiraterone acetate (or a pharmaceutically acceptable salt thereof) and a
`
`therapeutically effective amount of prednisone. I understand that when used as
`
`directed on its label, ZYTIGA®’s use practices the ’438 patent.
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`III. CONSIDERATION OF THE HOFMANN DECLARATION
`20.
`In this section, I review the commercial success analysis set forward by
`
`Mr. Ivan T. Hofmann in his declaration. First, I summarize Mr. Hofmann’s principal
`
`contentions. I then assess his characterization of ZYTIGA®’s marketplace success
`
`and his discussion of certain elements that he asserts preclude ZYTIGA®’s
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`performance from providing “objective indicia of nonobviousness of the ’438
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`patent” in the current matter. I note Mr. Hofmann does not conclude that ZYTIGA®
`
`has not been a marketplace success and that his attempts to temper ZYTIGA®’s
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`impressive marketplace performance fail to undermine ZYTIGA®’s clear
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`marketplace success. I further find his attempts to call into question the economic
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`relevance of ZYTIGA®’s marketplace success and the nexus of such success to the
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`claims of the ’438 patent fail to withstand economic scrutiny.
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`A. Overview of Mr. Hofmann’s Contentions
`21. Mr. Hofmann begins by laying out his basis for “the definitions of
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`commercial success and nexus.” (Ex. 1017 (Hofmann Dec.) at ¶¶ 21-23.) He notes
`
`that “the commercial success of the product must be attributable to the alleged novel
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`features of the claimed invention”; thus, “there must be a causal correlation, or
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`‘nexus,’ between the unique merit of the claimed invention and the success of the
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`product.” (Id. at ¶ 23.)
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`22. Next, Mr. Hofmann discusses U.S. Patent No. 5,604,213 (“the ’213
`
`patent”) – a patent which I understand covers a class of compounds including
`
`abiraterone acetate. (Ex. 1017 (Hofmann Dec.) at § V.) He contends that the ’213
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`patent effectively served as a “blocking patent” for abiraterone acetate, which
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`prevented others from “making, selling, or using an abiraterone product,” (Id. at ¶
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`26) and thus its existence “would provide companies limited economic incentives to
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`develop the invention claimed in the ’438 Patent.” (Id. at ¶ 26.)
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`23. Mr. Hofmann also contends that the following additional factors
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`“indicate a lack of nexus between the alleged invention…and the performance of
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`Zytiga.” (Id. at ¶ 29):
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` Mr. Hofmann understands from Dr. Garnick that methods for treating patients
`with combinations of drugs are common in the marketplace for cancer
`treatment, including combinations encompassing a glucocorticoid (Id. at ¶ 32);
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` Mr. Hofmann understands from Dr. Garnick that there are “no unexpected anti-
`cancer synergies resulting from co-administering abiraterone and prednisone”
`(Id. at ¶ 33); and
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` Mr. Hofmann understands from Dr. Garnick that “the use of the specific
`glucocorticoid prednisone has not been shown to have incremental benefit over
`other glucocorticoid steroids” (Id. at ¶ 34).
`
`24. Finally, Mr. Hofmann makes the following characterizations regarding
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`ZYTIGA®’s marketplace performance:
`
` The USPTO cited “unexpected commercial success” in its July 3, 2013 Notice
`of Allowance,6 even though J&J provided evidence only of ZYTIGA®’s actual
`sales “without a baseline for expectations” (Id. at ¶ 36);
`
` ZYTIGA®’s sales share as of April 2013 among all mCRPC patients was 29%,
`and its share among all prostate cancer patients was approximately 3 to 6% (Id.
`at ¶ 37); and
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` The “claim that Zytiga is ‘the most successful oral oncology launch in
`history’…is incomplete in light of non-oral cancer drugs with even greater
`sales” (Id. at ¶ 38).
`
`25. As noted above, Mr. Hofmann neither concludes nor disputes that
`
`ZYTIGA® has constituted a marketplace success, though he does attempt to
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`deemphasize that success. In this section, I assess Mr. Hofmann’s affirmative
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`6 Ex. 1013 at 2-3. Mr. Hofmann does not appear to consider that the USPTO’s
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`subsequent February 11, 2014 Notice of Allowance (Ex. 1015 at 2) and final June
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`2, 2014 Notice of Allowance (Ex. 1016 at 2) reference only ZYTIGA®’s
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`“commercial success” rather than “unexpected commercial success.”
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`contentions regarding ZYTIGA®’s marketplace performance in this matter. I
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`conclude that nothing in Mr. Hofmann’s discussion calls into dispute the
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`overwhelming marketplace success of ZYTIGA®. I further conclude that the
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`economic relevance of ZYTIGA®’s marketplace success is not materially limited
`
`by the factors raised by Mr. Hofmann, nor do these factors temper the nexus between
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`such success and the claims of the ’438 patent.
`
`B.
`
`26.
`
`The ’213 Patent as a Purported “Blocking Patent” Does Not
`Negate a Commercial Success Assessment
`1. Overview
`I understand the ’213 patent covers the abiraterone acetate compound.
`
`It claims a priority date of March 31, 1992, was issued on February 18, 1997, and
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`was originally assigned to British Technology Group, Ltd. (“BTG”) (Ex. 1005). The
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`’438 patent claims a priority date of August 25, 2006 and was issued on September
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`2, 2014 and assigned to Janssen. (Ex. 1001.)
`
`27.
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`In the present matter, Mr. Hofmann has argued that the ’213 patent acted
`
`as a blocking patent, and therefore would have limited economic incentives for those
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`in the industry without access to the ’213 patent to find and develop the technology
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`covered by the ’438 patent. (Ex. 1017 (Hofmann Dec.) at ¶ 26.)
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`28.
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`In this context, I consider the historical development of abiraterone
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`acetate and the economic incentives that were in place for developers to search for
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`the ’438 patented invention in the years leading up to the 2006 priority date and 2014
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`issuance of the ’438 patent. When the salient facts are properly considered, the ’213
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`patent did not serve as a disincentive to the industry to discover the invention
`
`claimed in the ’438 patent, as numerous opportunities arose that provided access to
`
`the ’213 patent.
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`2.
`Development and License Attempts of Abiraterone Acetate
`29. Early development work of the inventions underlying the ’213 patent
`
`was conducted in the 1990s by scientists at the U.K.-based Institute of Cancer
`
`Research (“ICR”), which assigned rights for abiraterone acetate’s development to
`
`BTG. (See Ex. 1005; Ex. 1078.) I understand that Boehringer Ingelheim partnered
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`with ICR and BTG in the 1996 – 1999 period, during which time the ’213 patent
`
`issued and the parties conducted Phase I clinical trials of abiraterone acetate in
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`humans for the first time. (Ex. 2028 (Judson Dec.) at ¶¶ 3, 5-6.)
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`30.
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`I further understand that following these trials and the submission of a
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`final report in 1999, Boehringer Ingelheim suspended its involvement in the
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`development of abiraterone acetate (Id. at ¶ 7) and that ICR/Royal Marsden/BTG
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`undertook a search for an alternative commercial partner, during which “a number
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`of major multinational pharmaceutical companies were approached.” (Id.) This is
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`consistent with Mr. Hofmann’s deposition testimony, in which he stated that among
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`other approaches, “one way to use intellectual property rights is in the form of a
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`license,” and “in the history of the ’213 patent, there … was some specific licensing
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`activity,” including BTG licensing the ’213 patent to others. (Ex. 2128 (Hofmann
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`Tr.) at 44-45.)
`
`31. The search for licensees in the ensuing years fell squarely within the
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`bounds of BTG’s central business strategy. As explained in BTG’s annual reports
`
`from this period:
`
` BTG stated that it was a “leader in technology commercialisation” with a
`“central strategy…to create a … business by acquiring, developing, and
`commercialising important life and physical science technologies…” (Ex. 2137
`at 4-5);
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` Further, BTG’s “two most common commercial routes [were] licensing the
`technology … and creating a venture …” (Ex. 2137 at 5);
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` BTG explained that its licensing route for technology commercialization
`entailed “licensing [the technology] to a corporation that will complete
`development and market the resulting product, in return for a combination of a
`downpayment, milestone payments and a royalty on product sales” (Ex. 2138 at
`3).
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`32. BTG documented its application of this general business strategy to
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`abiraterone on a BTG webpage in 2002, explaining that it owned the rights to
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`abiraterone acetate, noting abiraterone’s patent protection which included coverage
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`under the ’213 patent, and stating that BTG was seeking licensees. (Ex. 2136.)7
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`33.
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`Initially, none of the approached parties elected to support taking
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`abiraterone acetate into further trials. (Ex. 2028 (Judson Dec.) at ¶ 7.) Rights under
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`the ’213 patent went unclaimed for almost five years, until April 2004 when Cougar
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`Biotechnology Inc. (“Cougar”) executed a license for the rights to “develop and
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`commercialize” abiraterone acetate. (Id. at ¶ 9.) Johnson & Johnson (Janssen’s
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`parent company) acquired Cougar in 2009. (See Ex. 2101.) An examination of the
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`above history of the rights to the ’213 patent reveals an important dynamic. In the
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`several years leading up to the 2006 priority date of the ’438 patent (i.e.,
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`approximately 1999-2004), licensing rights to abiraterone acetate were available and
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`indeed actively shopped by the ’213 patent owner. Thus, for significant periods of
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`time immediately preceding the priority date for the ’438 patent, the incentives
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`relevant to the commercial success inquiry were broadly available.
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`7 To access this source, visit
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`http://web.archive.org/web/20020211122029/http:/www.btgplc.com/portfolio_avai
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`lable/index.html and click on “pharmaceuticals”  “oncology”  “Abiraterone
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`acetate.”
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`34. Moreover, I note that the cases cited by Mr. Hofmann in which he claims
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`“courts have found that, in the presence of blocking rights, existence of commercial
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`success provides little probative value on whether a claimed technology is obvious”
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`(Ex. 1017 (Hofmann Dec.) at ¶ 27, n. 28) involved “blocking rights” owned by the
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`party which owned the patent-in-suit.8 As a matter of economics, a relevant
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`consideration in such cases is the extent to which the owner of a purported “blocking
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`patent” may have refused to make rights to the “blocking patent” available to others
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`and any potential resulting effects on third parties’ incentives to have searched for
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`the newly patented invention. As mentioned above, in the present case the owner of
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`the purported “blocking patent” was BTG – a company in the express business of
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`commercializing technologies via joint ventures and licensing, not via unilateral
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`development, manufacture, and sale of these technologies. Thus, presently there
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`was no incentive on the part of the purported “blocking patent” owner to withhold
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`rights from third parties who could contribute to the technology’s development.
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`Indeed, the developer of the newly patented invention in the present case
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`(Cougar/Janssen) was a third party who did so having acquired rights to the
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`8 Mr. Hofmann provides confirmation of this in his deposition. (See Ex. 2128
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`(Hofmann Tr.) at 52-53.)
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`purported “blocking patent” via licensing. Thus, contrary to Mr. Hofmann’s
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`assessment, proper consideration of this history in fact demonstrates the existence
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`of the very economic incentives to search for the ’438 patented invention that Mr.
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`Hofmann claims were precluded or dampened by the existence of the ’213 patent.
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`C. Mr. Hofmann’s Assessment of Nexus is Incomplete
`35. Mr. Hofmann contends that there exists “a lack of nexus” between the
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`’438 patent and ZYTIGA®’s marketplace performance. (Ex. 1017 (Hofmann Dec.)
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`at ¶ 29.) However, Mr. Hofmann’s assessment of nexus is incomplete.
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`36. First, Mr. Hofmann states that he understands from Dr. Garnick that it
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`is common to provide cancer treatment to patients using combination of drugs,
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`including combinations of drugs encompassing a glucocorticoid (Id. at ¶ 32). For
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`example, Mr. Hofmann notes that prior to the development of abiraterone acetate,
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`ketoconazole was administered in combination with either hydrocortisone or
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`prednisone (Id. at ¶ 32). Nonetheless, I understand from Dr. Rettig that he believes
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`there was no basis in the prior art to believe the abiraterone acetate / prednisone
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`combination could be successful in “achieving the inventions claimed in the ’438
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`patent” (Ex. 2038 (Rettig Dec.) at § VIII.C). Dr. Rettig based his conclusion on his
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`contention that “as of August 2006, the prior art did not teach that ketoconazole was
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`‘safe and effective’ for the treatment of mCRPC,” (Id. at § VIII.C.1) and that “the
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`prior art did not provide a scientific or clinical basis for believing that prednisone
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`would be effective for treating cancer” (Id. at § VII.C.2). Thus, prior practice of
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`administering a glucocorticoid as part of combination therapy for the treatment of
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`cancer is not relevant to an evaluation of the present invention.
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`37. Second, Mr. Hofmann states that he understands from Dr. Garnick that
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`there exist “no unexpected anti-cancer synergies resulting from co-administering
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`abiraterone and prednisone” (Ex. 1017 (Hofmann Dec.) at ¶ 33). Mr. Hofmann
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`contends that ZYTIGA®’s indicated coadministration with prednisone – i.e. the
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`practice of the ’438 patent – provides no additional efficacy beyond the sum of the
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`individual benefits of abiraterone acetate and prednisone (Id. at ¶¶ 33-34). However,
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`as noted above, I understand from Dr. Rettig that there “was no scientific or clinical
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`basis in the prior art for believing that the combination of abiraterone acetate and
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`prednisone could be successful in achieving the inventions claimed in the ’438
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`patent” (Ex. 2038 (Rettig Dec.) at § VIII.C), and yet doctors prescribe ZYTIGA®
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`as mCRPC therapy “because of the observed enhanced survival benefit of the
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`combination” of abiraterone and prednisone (Id. at ¶ 219).
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`38. Third, Mr. Hofmann understands from Dr. Garnick that the use “of the
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`specific glucocorticoid prednisone has not been shown to have incremental benefit
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`over other glucocorticoid steroids” (Ex. 1017 (Hofmann Dec.) at ¶ 34). Specifically,
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`Mr. Hofmann understands from Dr. Garnick that glucocorticoids other than
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`prednisone, which the ’438 patent does not cover, would be “expected to be just as
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`effective as prednisone in enhancing the tolerability of abiraterone acetate” (Id. at ¶
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`34). Mr. Hofmann also understands from Dr. Garnick that “[s]ince no studies have
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`compared the administration of abiraterone acetate plus prednisone with the
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`administration of abiraterone acetate alone, the addition of prednisone…has not been
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`shown to have any additional benefit beyond increasing the tolerability of the
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`treatment.” (Id.) However, where ZYTIGA®’s FDA-approved method of use
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`practices the ’438 patented invention, I understand that Mr. Hofmann’s arguments
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`concerning whether or not the use of p