Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 1 of 14
`
`737 F.3d 731 (2013)
`
`GALDERMA LABORATORIES, L.P., Galderma S.A., and Galderma Research and
`Development, S.N.C., Plaintiffs-Appellees,
`v.
`TOLMAR, INC., Defendant-Appellant.
`
`No. 2013-1034.
`
`United States Court of Appeals, Federal Circuit.
`
`December 11, 2013.
`
`734
`
`*734 Charles E. Lipsey, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, of Reston, VA, argued for plaintiffs-
`appellees. With him on the brief were Howard W. Levine, Sanya Sukduang, Cortney B. Casp, and Victoria S. Lee, of
`Washington, DC.
`
`Thomas P. Steindler, McDermott Will & Emery LLP, of Washington, DC, argued for defendant-appellant. With him on
`the brief were Jeffrey R. Gargano and Keith M. Stolte, of Chicago, IL.
`
`Before NEWMAN, BRYSON, and PROST, Circuit Judges.
`
`PROST, Circuit Judge.
`
`In this patent infringement case, Tolmar, Inc. challenges the district court's holding that the claims of U.S. Patent Nos.
`7,579,377 (`377 patent); 7,737,181 (`181 patent); 7,834,060 (`060 patent); 7,838,558 (`558 patent); and 7,868,044
`(`044 patent), which are owned by Galderma Laboratories, L.P., Galderma S.A., and Galderma Research and
`Development, S.N.C. (collectively, "Galderma") are not invalid under 35 U.S.C. § 103. We find that the district court
`erred in finding the claims of the asserted patents not invalid as obvious. Accordingly, we reverse.
`
`I. BACKGROUND
`
`This Hatch-Waxman case is based on Tolmar's filing of an Abbreviated New Drug Application ("ANDA") seeking
`approval to market a generic version of Differin® Gel, 0.3%, which is a topical medication containing 0.3% by weight
`adapalene approved for the treatment of acne. On January 21, 2010, Galderma sued Tolmar in the United States
`District Court for the District of Delaware, alleging that Tolmar's ANDA product infringed certain claims of the '377
`patent. Galderma subsequently filed amended complaints alleging infringement of each of the asserted patents. After
`a bench trial, the district court ruled against Tolmar on several issues of which only invalidity under 35 U.S.C. § 103 is
`at issue in this appeal.
`
`A. Patented Technology
`
`The asserted patents include both composition claims and claims directed to methods of treating acne using
`pharmaceutical compositions. At trial, Galderma alleged infringement of claims 35 and 36 of the '181 patent, claims 24
`and 27 of the '060 patent, claim 5 of the '558 patent, and claims 40 and 41 of the '044 patent.[1] Each of the asserted
`claims requires an aqueous gel or cream that includes 0.3% by weight of adapalene. The asserted claims also recite
`one or more inactive excipients included in the gel or cream. Claim 5 of the '558 patent is representative:
`
`5. A topically applicable pharmaceutical composition comprising 0.3% by weight of [adapalene] relative
`to the total weight of the composition, effective for the treatment of acne, formulated into a topically
`
`https://scholar.google.com/scholar_case?q=galderma+labs+v+tolmar&hl=en&as_sdt=40000...
`
`2/3/2017
`
`ACTAVIS, AMNEAL, DR. REDDY'S LABORATORIES, SUN, TEVA, WEST-WARD
`IPR2017-00853 - Ex. 1048, p. 1 of 14
`
`

`

`Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 2 of 14
`
`applicable, pharmaceutically acceptable medium therefor, said composition being in the form of a
`topically applicable, pharmaceutically acceptable aqueous gel comprising at least one carbomer gelling
`agent and wherein the sole anti-acne ingredient is adapalene.
`
`B. Prior Art
`
`735
`
`Below, Tolmar based its obviousness argument primarily on three pieces of prior art: U.S. Patent No. 4,717,720
`("Shroot '720 patent"), U.S. Reissue No. 34,440 *735 ("Shroot '440 patent"), and the Differin® 0.1% Gel Data Sheet
`("Data Sheet").
`
`The Shroot '720 patent specifically discloses and claims adapalene along with other inventive compounds. Col. 3 ll.
`9-10; col. 4 ll. 29-37; col. 9 ll. 39-54; col. 19 l.17col. 20 l. 19. Four of the seven composition examples in the Shroot
`'720 patent disclose adapalene as the active ingredient, in concentrations of 0.001%, 0.1%, and 1%. Col. 16 ll. 35-53;
`col. 17 ll. 20-52. The specification of the Shroot '720 patent states repeatedly that the inventive compounds are useful
`for the treatment of acne. See col. 4 ll. 53-59; see also col. 5 ll. 49-53. Moreover, the specification states that the
`inventive compounds can be used in concentrations "preferably between 0.01 and 1 weight percent, based on the total
`weight of the composition." Shroot '720 patent col. 5 ll. 61-64. Finally, the Shroot '720 patent indicates that the
`inventive compounds "are less irritating than known retinoids of analogous structure." Col. 4 ll. 48-51. The Shroot '440
`patent is largely similar to the Shroot '720 patent, but also contains claim 4, which recites a preferred range of 0.01 to
`1% for cosmetic compositions which include the inventive compounds, e.g., adapalene, as the active ingredient.
`Shroot '440 patent col. 20 ll. 15-18. Notably, prior to their expiration, the Shroot patents were listed in the FDA's
`Orange Book as covering Galderma's prior art Differin® 0.1% Gel as well as Differin® Gel, 0.3%.
`
`The Data Sheet is the product insert for Galderma's earlier launched adapalene product. The Data Sheet discloses
`0.1% adapalene as a treatment for acne. It also discloses all but one of the inactive ingredients listed in the asserted
`claims. Other than the dosage of adapalene, the only difference between the claimed formulations and the formulation
`taught by the Data Sheet is that the Data Sheet discloses "poloxamer 182," while certain asserted claims list
`"poloxamer 124."
`
`In addition to the Shroot patents and the Data Sheet, Tolmar provided other relevant evidence. For instance, a 1989
`article by Jamoulle et al. describes the use of a lotion containing 0.3% adapalene in an animal model to determine
`whether adapalene was suitable for the treatment of acne. The authors concluded from this test that adapalene was
`"particularly suitable for the treatment of acne." J.A. 13063. A series of other prior art articles demonstrate that 0.03%
`and 0.1% adapalene products were effective against acne and well tolerated. These articles include: Verschoore et al.,
`Efficacy and Safety of CD 271 Alcoholic Gels in the Topical Treatment of Acne Vulgaris, 124 British J. of Derm. 368-71
`(1991) ("Verschoore 1991"); Alirezai et al., Comparative Study of the Effectiveness and Tolerance of 0.1 and 0.03
`Percent Adapalene Gels and of a 0.025 Percent Tretinoin Gel in the Treatment of Acne, 123 Ann. Dermatol. Venereol.
`165-70 (1996) ("Alirezai 1996"); Allec et al., Skin Distribution and Pharmaceutical Aspects of Adapalene Gel, 35(6) J.
`Am. Acad. of Dermatol. S119-25 (1997) ("Allec 1997").
`
`736
`
`The prior art also teaches the use of 0.3% adapalene for other conditions without intolerable irritability. See
`Verschoore et al., Adapalene 0.1 % Gel Has Low Skin Irritation Potential, 36(6) J. Am. Acad. of Dermatol. S104-09
`(1997) ("Verschoore 1997"); Goldfarb, Using Adapalene to Treat Photodamage, Supp. to Skin & Aging 4-7 (Nov.2000)
`("Goldfarb Article"); Goldfarb et al., Photographic Assessment of the Effects of Adapalene 0.1 % and 0.3% Gels and
`Vehicle on Photodamage Skin, 14 (Supp.1) J. Eur. Acad. Dermatol. Venerol. 315 (2000) ("Goldfarb Abstract");
`Euvrard, "How Adapalene Can Treat Actinic Keratoses," Supp. to Skin & Aging 12-15 (Nov. *736 2000) ("Euvrard
`2002").[2] There was also an indication in the prior art that dermatologists preferred other retinoids to adapalene at
`least in part because they were available in multiple concentrations whereas adapalene was only available in one.
`Bershad et al., Topical Retinoids in the Treatment of Acne Vulgaris, 64 (Supp.2) Cutaneous Med. for the Practitioner
`8-19 (Aug.1999) ("Bershad 1999"). Finally, the prior art indicated that many skilled artisans believed at the time of the
`invention that 0.1% was the optimal concentration of adapalene for the treatment of acne. See Verschoore 1997; Allec
`
`https://scholar.google.com/scholar_case?q=galderma+labs+v+tolmar&hl=en&as_sdt=40000...
`
`2/3/2017
`
`ACTAVIS, AMNEAL, DR. REDDY'S LABORATORIES, SUN, TEVA, WEST-WARD
`IPR2017-00853 - Ex. 1048, p. 2 of 14
`
`

`

`Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 3 of 14
`
`1997; Czernielewski et al., Adapalene Biochemistry and the Evolution of a New Topical Retinoid for Treatment of
`Acne, 15 (Supp.3) J. Eur. Acad. Dermatol. Venerol. 5-12 (2001) ("Czernielewski 2001").
`
`II. OBVIOUSNESS
`
`The determination of invalidity for reasons of obviousness under 35 U.S.C. § 103 is a legal conclusion based on
`underlying facts. Graham v. John Deere Co., 383 U.S. 1, 17, 86 S.Ct. 684, 15 L.Ed.2d 545 (1966). Following a bench
`trial, we "review the district court's factual findings for clear error and its conclusions of law de novo." Winner Int'l
`Royalty Corp. v. Wang, 202 F.3d 1340, 1344-45 (Fed.Cir. 2000).
`
`Factual considerations that underlie the obviousness inquiry include the scope and content of the prior art, the
`differences between the prior art and the claimed invention, the level of ordinary skill in the art, and any relevant
`secondary considerations. See Graham, 383 U.S. at 17-18, 86 S.Ct. 684. Relevant secondary considerations include
`commercial success, long-felt but unsolved needs, failure of others, and unexpected results. KSR Int'l Co. v. Teleflex
`Inc., 550 U.S. 398, 406, 127 S.Ct. 1727, 167 L.Ed.2d 705 (2007); In re Soni, 54 F.3d 746, 750 (Fed.Cir.1995).
`Because patents are presumed valid, Tolmar was required to prove that the asserted claims were obvious by clear
`and convincing evidence. See Microsoft Corp. v. i4i Ltd. P'ship, ___ U.S. ___, 131 S.Ct. 2238, 2242, 180 L.Ed.2d 131
`(2011).
`
`Tolmar presents an obviousness case that is both straightforward and potent. At the time of the invention, adapalene
`was a known compound and the prior art Shroot patents disclose topical adapalene compositions for the purpose of
`treating acne in a preferred range of 0.01%-1%, including several exemplary formulations containing adapalene in
`various concentrations. The asserted claims are directed to 0.3% topical adapalene compositions for the treatment of
`acne, which fall within the concentration range disclosed in the Shroot patents. Thus, the Shroot patents disclose all of
`the limitations of the asserted claims, except for a precise teaching of 0.3% adapalene and the specific inactive
`ingredients of the asserted claims. The specific inactive ingredients of the asserted claims are, however, taught by the
`Data Sheet.
`
`737
`
`The Data Sheet discloses each of the inactive ingredients, except for poloxamer 124. However, the district court found
`poloxamer 124 equivalent to poloxamer 182, which is disclosed in the Data Sheet. Moreover, the district court held
`that "the record evidence establishes that the inactive ingredients in the claimed formulations [were] routine and
`obvious, and, therefore, non-inventive." Galderma Labs., L.P. v. Tolmar, Inc., 891 F.Supp.2d *737 588, 645
`(D.Del.2012). Notably, on appeal, the parties do not dispute the obviousness of the inactive ingredients of the
`formulation. Rather, the sole dispute between the parties is whether it was obvious to use a 0.3% adapalene
`composition for the treatment of acne. Accordingly, Tolmar argues that the asserted claims are obvious because they
`claim nothing more than the use of an old compound for a known purpose in a concentration that falls within a range
`disclosed in the prior art as preferred for that purpose.
`
`Tolmar buttresses its obviousness argument with other relevant evidence. This evidence includes a study that used a
`lotion containing 0.3% adapalene in an animal model to determine that adapalene was "particularly suitable for the
`treatment of acne." J.A. 13063. Additionally, the prior art showed that 0.03% and 0.1% adapalene products were
`suitable for the treatment of acne and that 0.3% adapalene products were suitable for the treatment of other conditions
`without intolerable irritability. Moreover, the prior art indicated that dermatologists desired acne treatments that came in
`varying concentrations. According to Tolmar, this provides further motivation to select a 0.3% adapalene composition
`for the treatment of acne.
`
`The district court rejected Tolmar's obviousness case, finding that Tolmar "failed to establish, by clear and convincing
`evidence, that the claimed inventions would have been obvious to a person of ordinary skill at the time of the
`invention." Galderma Labs., 891 F.Supp.2d at 637. In reaching this conclusion, the district court relied heavily on
`evidence showing that increasing the dose of adapalene was likely to increase the incidence of certain side effects and
`evidence showing that 0.1% was considered the optimal adapalene concentration for the treatment of acne. Id. at 641-
`
`https://scholar.google.com/scholar_case?q=galderma+labs+v+tolmar&hl=en&as_sdt=40000...
`
`2/3/2017
`
`ACTAVIS, AMNEAL, DR. REDDY'S LABORATORIES, SUN, TEVA, WEST-WARD
`IPR2017-00853 - Ex. 1048, p. 3 of 14
`
`

`

`Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 4 of 14
`
`42. In addition, the court found "that at least two secondary considerations, unexpected results and commercial
`success, additionally support the determination that the asserted claims are not invalid due to obviousness." Id. at 642-
`44.
`
`Prior to addressing the obviousness of the asserted claims, we note an error in the district court's obviousness
`analysis. The district court framed the obviousness inquiry as requiring Tolmar to provide motivation in the prior art to
`triple the concentration of adapalene from 0.1% to 0.3%. Id. at 638. Tolmar carried no such burden. Rather, Tolmar,
`like all those who seek to prove claims obvious, was required to show that "the differences between the claimed
`invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective
`filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains."
`35 U.S.C. § 103. Nothing in the statute or our case law requires Tolmar to prove obviousness by starting with a prior
`art commercial embodiment and then providing motivation to alter that commercial embodiment. See KSR, 550 U.S. at
`419, 127 S.Ct. 1727 ("In determining whether the subject matter of a patent claim is obvious, neither the particular
`motivation nor the avowed purpose of the patentee controls. What matters is the objective reach of the claim. If the
`claim extends to what is obvious, it is invalid under § 103."). This is particularly true where, as here, the prior art
`teaches a range that encompasses both the prior art commercial embodiment and the claimed invention.
`
`738
`
`The relevant dispute in this case is thus not over whether the prior art discloses all of the claim elements or over the
`motivation to combine the prior art references. Rather, the dispute is whether there was motivation to select the
`claimed 0.3% adapalene composition in the disclosed *738 range. In these circumstances, where there is a range
`disclosed in the prior art, and the claimed invention falls within that range, the burden of production falls upon the
`patentee to come forward with evidence that (1) the prior art taught away from the claimed invention; (2) there were
`new and unexpected results relative to the prior art; or (3) there are other pertinent secondary considerations. See
`Novo Nordisk A/S v. Caraco Pharm. Labs., Ltd., 719 F.3d 1346, 1352-54 (Fed. Cir.2013).
`
`Accordingly, Tolmar having demonstrated that the prior art taught a range of concentrations of adapalene for the
`treatment of acne that encompasses the claimed 0.3% adapalene composition, we now examine the district court's
`findings with respect to the factors listed above to determine whether the claims are invalid as obvious. The ultimate
`burden of proving obviousness rests with Tolmar.
`
`A. Teaching Away
`
`Despite express teachings in the Shroot patents indicating that adapalene would be useful in concentrations preferably
`between 0.01% and 1%, the district court found that the prior art taught away from a 0.3% adapalene composition. The
`district court based its conclusion primarily on two related grounds.[3] First, according to the district court, the prior art
`taught "away from the selection of 0.3% adapalene for the treatment of acne, because of dose-dependent increases in
`side effects." Galderma Labs., 891 F.Supp.2d at 641 n. 8. And second, the prior art taught that 0.1% was the optimal
`concentration of adapalene for the treatment of acne. Id. at 641-42. We leave undisturbed the district court's findings
`that increasing the dose of adapalene would result in a concomitant increase in side effects and that 0.1% was the
`optimal concentration of adapalene for the treatment of acne at the time of the invention. However, to the extent the
`court found that these facts taught away from the claimed invention, it clearly erred.
`
`A reference may be said to teach away when a person of ordinary skill, upon reading the reference,
`would be discouraged from following the path set out in the reference, or would be led in a direction
`divergent from the path that was taken by the applicant. A reference does not teach away, however, if it
`merely expresses a general preference for an alternative invention but does not criticize, discredit, or
`otherwise discourage investigation into the invention claimed.
`
`DePuy Spine, Inc. v. Medtronic Sofamor Danek, Inc., 567 F.3d 1314, 1327 (Fed.Cir. 2009). With respect to the prior
`art teachings of dose-dependent side effects, the district court relied on the Verschoore 1991 and Alirezai 1996
`articles, which show that the increase in adapalene concentration from 0.03% to 0.1% resulted in an increase in side
`
`https://scholar.google.com/scholar_case?q=galderma+labs+v+tolmar&hl=en&as_sdt=40000...
`
`2/3/2017
`
`ACTAVIS, AMNEAL, DR. REDDY'S LABORATORIES, SUN, TEVA, WEST-WARD
`IPR2017-00853 - Ex. 1048, p. 4 of 14
`
`

`

`Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 5 of 14
`
`effects. Neither of these articles mentions 0.3% adapalene compositions, nor do they expressly teach away from the
`claimed invention. The district court inferred that these references taught away from a further tripling of the adapalene
`concentration. We cannot agree with this inference.
`
`739
`
`These articles show increased side effects associated with 0.1% adapalene as *739 compared to 0.03% adapalene,
`yet they failed to discourage even the use of 0.1% adapalene. To the contrary, as the district court found, 0.1% was
`the optimal concentration of adapalene at the time of the invention. Galderma Labs., 891 F.Supp.2d at 641-42.
`Moreover, there is nothing in either of these references to indicate that increasing the concentration to 0.3% would be
`unproductive, nor do these articles indicate in any way that the side effects would be serious enough to dissuade the
`development of a 0.3% adapalene product. Therefore, the Verschoore 1991 and Alirezai 1996 articles fail to teach
`away from the claimed invention.
`
`The district court relied on the Allec 1997, Verschoore 1997, and Czernielewski 2001 articles to demonstrate that 0.1%
`was the standard or optimal concentration of adapalene for the treatment of acne. The court concluded that this fact
`teaches away from 0.3% adapalene compositions. It does not. "A reference does not teach away ... if it ... does not
``criticize, discredit, or otherwise discourage' investigation into the invention claimed." DePuy Spine, 567 F.3d at 1327
`(citing In re Fulton, 391 F.3d 1195, 1201 (Fed.Cir.2004)). A teaching that a composition may be optimal or standard
`does not criticize, discredit, or otherwise discourage investigation into other compositions. Accordingly, the Allec 1997,
`Verschoore 1997, and Czernielewski 2001 articles do not teach away from the claimed invention.
`
`B. Unexpected Results
`
`The district court found that the comparable tolerability of 0.1% and 0.3% adapalene was unexpected in view of the
`prior art, since a skilled artisan would have expected that tripling the concentration of adapalene would have resulted
`in a clinically significant increase in side effects. Galderma Labs., 891 F.Supp.2d at 642-44. While we agree that this
`result was unexpected, it does not constitute an unexpected result that is probative of nonobviousness.
`
`Unexpected results that are probative of nonobviousness are those that are "different in kind and not merely in degree
`from the results of the prior art." Iron Grip Barbell Co. v. USA Sports, Inc., 392 F.3d 1317, 1322 (Fed.Cir.2004) (citation
`omitted). Results which differ by percentages are differences in degree rather than kind, where the modification of the
`percentage is within the capabilities of one skilled in the art at the time. See In re Harris, 409 F.3d 1339, 1344
`(Fed.Cir.2005) (finding increased efficacy, measured by percentages, to be a difference of degree and not of kind); In
`re Budde, 50 C.C.P.A. 1491, 319 F.2d 242, 246 (1963) (finding no unexpected results where ranges of reaction time
`and temperature constituted only a difference in degree rather than in kind); In re Aller, 42 C.C.P.A. 824, 220 F.2d 454,
`456-57 (1955) (finding no unexpected results where improved yields over the prior art, measured by percentages,
`reflect a difference in degree, not in kind). Thus, where an unexpected increase in efficacy is measured by a small
`percentage, as here, and the evidence indicates that skilled artisans were capable of adjusting the percentage, the
`result constitutes a difference in degree, not kind. So too, where an increase by a percentage is expected but not
`found, that result is also likely only a difference in degree. In this case, the expected result was an increase, by some
`percentage, in the prevalence of certain side effects. The failure of that percent increase to materialize, though
`unexpected, constitutes only a difference in degree from the prior art results. Accordingly, the comparable tolerability
`of 0.1% and 0.3% adapalene does not indicate that the asserted claims are non-obvious.
`
`740
`
`*740 C. Commercial Success
`
`"Evidence of commercial success... is only significant if there is a nexus between the claimed invention and the
`commercial success." Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299, 1311-12 (Fed.Cir.2006). "When a patentee
`can demonstrate commercial success, usually shown by significant sales in a relevant market, and that the successful
`product is the invention disclosed and claimed in the patent, it is presumed that the commercial success is due to the
`patented invention." J.T. Eaton & Co. v. Atlantic Paste & Glue Co., 106 F.3d 1563, 1571 (Fed.Cir.1997). However, "if
`
`https://scholar.google.com/scholar_case?q=galderma+labs+v+tolmar&hl=en&as_sdt=40000...
`
`2/3/2017
`
`ACTAVIS, AMNEAL, DR. REDDY'S LABORATORIES, SUN, TEVA, WEST-WARD
`IPR2017-00853 - Ex. 1048, p. 5 of 14
`
`

`

`Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 6 of 14
`
`the feature that creates the commercial success was known in the prior art, the success is not pertinent." Ormco Corp.,
`463 F.3d at 1311-12; see also J.T. Eaton, 106 F.3d at 1571 ("[T]he asserted commercial success of the product must
`be due to the merits of the claimed invention beyond what was readily available in the prior art").
`
`The district court found that "[t]he commercial success of Galderma's 0.3% adapalene product also supports a finding
`of nonobviousness." Galderma Labs., 891 F.Supp.2d at 644. The district court gave two reasons for its finding. First,
`Differin® 0.3%, Galderma's commercial embodiment of the claims, "quickly gained and maintained market
`share—even in the face of an overall declining market and decreasing promotional expenditures, and while facing
`competition from generic 0.1% adapalene formulations." Id. Second, the court found "that Tolmar (along with another
`ANDA filer, Actavis) seeks to enter the market precisely because Differin® 0.3% has been commercially successful."
`Id. We discuss these findings in reverse order.
`
`The mere fact that generic pharmaceutical companies seek approval to market a generic version of a drug, without
`more, is not evidence of commercial success that speaks to the non-obviousness of patent claims. Plainly, Tolmar
`believes that it can make a profit selling a generic version of the claimed invention. This is likely true in all Hatch-
`Waxman cases, if not all patent cases generally. However, that fact tells us very little about the level of commercial
`success of the patented invention relative to the prior art or the extent to which the commercial success of the branded
`drug is "due to the merits of the claimed invention beyond what was readily available in the prior art." J.T. Eaton, 106
`F.3d at 1571. As such, it does not support a finding of non-obviousness.
`
`The court also relied on the fact that Differin® Gel, 0.3% quickly gained and maintained market share to find
`commercial success. We do not disturb this finding. However, we note that it is of limited value in determining whether
`or not the presently asserted claims are obvious. "Commercial success is relevant because the law presumes an idea
`would successfully have been brought to market sooner, in response to market forces, had the idea been obvious to
`persons skilled in the art." Merck & Co. v. Teva Pharm. USA, Inc., 395 F.3d 1364, 1376 (Fed.Cir. 2005). Where
`"market entry by others was precluded [due to blocking patents], the inference of non-obviousness of [the asserted
`claims], from evidence of commercial success, is weak." Id. at 1377. This principle applies forcefully to the present
`case.
`
`741
`
`The now expired Shroot patents blocked the market entry of 0.3% adapalene products until their expiration in 2010,
`long after Galderma invented 0.3% adapalene compositions of the asserted claims. As such, no entity other than
`Galderma could have successfully brought to 0.3% to market prior to 2010. Like the commercial *741 success
`described in Merck & Co., the commercial success of Differin® Gel, 0.3% is of "minimal probative value." Id. at 1376.
`Accordingly, we conclude the district court erred in adjudging this factor as confirming its conclusion of
`nonobviousness.
`
`III. CONCLUSION
`
`For the foregoing reasons, we hold that claims 35 and 36 of the '181 patent, claims 24 and 27 of the '060 patent, claim
`5 of the '558 patent, and claims 40 and 41 of the `044 patent are invalid as obvious. We therefore reverse the district
`court's finding that the claims are valid.
`
`REVERSED
`
`NEWMAN, Circuit Judge, dissenting.
`
`Without doubt, the question of obviousness here presented is a close call. However, when the question is close, when
`it turns on findings and interpretations of biologic and medicinal evidence, when the application of law to fact invokes
`the policy of the patent statute to advance the useful arts, then the findings and rulings of the trial court warrant
`particular attention on appellate review.
`
`https://scholar.google.com/scholar_case?q=galderma+labs+v+tolmar&hl=en&as_sdt=40000...
`
`2/3/2017
`
`ACTAVIS, AMNEAL, DR. REDDY'S LABORATORIES, SUN, TEVA, WEST-WARD
`IPR2017-00853 - Ex. 1048, p. 6 of 14
`
`

`

`Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 7 of 14
`
`Here, the district court fully explored the evidence relating to whether it would have been obvious to increase by 300%
`the concentration of the active ingredient adapalene without increasing its known adverse side effects. The district
`judge held an eight-day bench trial, heard thirteen live witnesses including expert witnesses of stature and experience,
`and received evidence and argument from both sides. The court issued an opinion with over 50 pages on the issue of
`obviousness, finding the facts and weighing the evidence and applying the law with thoughtful explanation and
`reasoning.[1]
`
`My colleagues on this panel give scant attention to the district court's analysis, instead making their own findings, and
`applying flawed procedural and substantive law. My colleagues do not identify clear error in the district court's findings;
`instead they distort the burdens of proof and production, ignore the applicable standard of proof and rely on their own
`factual determinations and creative theories of law, and eradicate the patent.
`
`The district court ruled that there was not clear and convincing evidence of invalidity. By contrast, my colleagues
`announce their rule whereby a broad teaching that includes the patented invention removes the statutory presumption
`of validity, and without more establishes obviousness. See maj. op. at 737-38 ("where there is a range disclosed in the
`prior art, and the claimed invention falls within that range, the burden of production falls upon the patentee ...").
`Although the majority mentions the requirement of clear and convincing evidence of invalidity, the majority presumes
`that the prior art establishes invalidity, and places on the patentee the burden of establishing patentability based on
`"secondary considerations." The majority goes on to impose a new and unprecedented view of these considerations.
`
`For example, although the panel majority concedes that there are unexpected results for the concentration selected by
`the patentee, see maj. op. at 739 ("we agree that this result was unexpected"), my colleagues do not require the
`patent challenger to show any reason in the prior art (or common sense) for selection of this embodiment with its
`unexpected properties. Rather, they hold that unless a skilled artisan was not "capable of adjusting the percentage,"
`id., the extent of the change in percentage (here 300%) and the unexpected *742 results and properties are irrelevant
`to patentability.
`
`742
`
`In refusing to credit any of the demonstrated "secondary considerations" my colleagues foreclose patentability to a
`vast body of improvement patents. In the field of medicaments, the denial of patentability for improvements is a
`disincentive to the development of such improvements. The losers are those afflicted with disease. I respectfully
`dissent.
`
`DISCUSSION
`
`Particularly for close questions of patentability, the district court's findings and assessments of credibility and weight of
`evidence, and the district court's application of law to found facts, compel appellate attention. The role of the trial court
`in considering the evidence that each party provides through examination and cross-examination of witnesses and
`documents, with judicial elaboration and interaction, cannot be matched on appeal. As the Supreme Court stated in
`Anderson v. Bessemer City, "duplication of the trial judge's efforts in the court of appeals would very likely contribute
`only negligibly to the accuracy of fact determination at a huge cost in diversion of judicial resources." 470 U.S. 564,
`574-75, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985).
`
`Clear and convincing evidence is required to overcome the statutory presumption of validity of a duly granted patent.
`See 35 U.S.C. § 282 (a patent is presumed valid); Cardinal Chem. Co. v. Morton Int'l, 508 U.S. 83, 93 n. 15, 113 S.Ct.
`1967, 124 L.Ed.2d 1 (1993) (invalidity must be proved by clear and convincing evidence). Here the panel majority does
`not provide clear and convincing evidence of invalidity. Instead, the majority discards the trial judge's findings on the
`premise of a presumption of invalidity that the majority applies to "selection" inventions, that is, inventions within a
`known class or range of technology, for which the majority discards the established procedural and substantive
`burdens. The majority makes its own factual findings, and writes new law.
`
`In contrast to the panel majority's dismissive analysis, the district court's findings reflect careful examination of all of
`the evidence. Nonetheless, my colleagues conclude that the selection of a 300% increase in dosage was obvious,
`
`https://scholar.google.com/scholar_case?q=galderma+labs+v+tolmar&hl=en&as_sdt=40000...
`
`2/3/2017
`
`ACTAVIS, AMNEAL, DR. REDDY'S LABORATORIES, SUN, TEVA, WEST-WARD
`IPR2017-00853 - Ex. 1048, p. 7 of 14
`
`

`

`Galderma Laboratories, LP v. Tolmar, Inc., 737 F. 3d 731 - Court of Appeals, Federal Cir...
`
`Page 8 of 14
`
`after the unexpected properties of the increase were discovered by this patentee. I sum