United States Court of Appeals
`for the Federal Circuit
`______________________
`
`NOVARTIS AG, MITSUBISHI PHARMA CORP.,
`Appellants
`
`v.
`
`TORRENT PHARMACEUTICALS LIMITED,
`APOTEX INC., MYLAN PHARMACEUTICALS INC.,
`Appellees
`______________________
`
`2016-1352
`______________________
`
`Appeal from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in Nos. IPR2014-
`00784, IPR2015-00518.
`______________________
`
`Decided: April 12, 2017
`______________________
`
`ROBERT TRENCHARD, Gibson, Dunn & Crutcher LLP,
`New York, NY, argued for appellants. Appellant Novartis
`AG also represented by JANE M. LOVE; MICHAEL A. VALEK,
`Dallas, TX; ALEXANDER N. HARRIS, San Francisco, CA.
`
`JOSEPH M. O'MALLEY, JR., Paul Hastings LLP, New
`York, NY, for appellant Mitsubishi Pharma Corp. Also
`represented by ERIC WILLIAM DITTMANN.
`
`(cid:36)(cid:53)(cid:42)(cid:40)(cid:49)(cid:55)(cid:56)(cid:48)(cid:3)(cid:40)(cid:59)(cid:20)(cid:19)(cid:23)(cid:20)
`
`SUN - IPR2017-01929, Ex. 1041, p. 1 of 27
`
`
`for the Federal Circuit
`______________________
`
`NOVARTIS AG, MITSUBISHI PHARMA CORP.,
`Appellants
`
`v.
`
`TORRENT PHARMACEUTICALS LIMITED,
`APOTEX INC., MYLAN PHARMACEUTICALS INC.,
`Appellees
`______________________
`
`2016-1352
`______________________
`
`Appeal from the United States Patent and Trademark
`Office, Patent Trial and Appeal Board in Nos. IPR2014-
`00784, IPR2015-00518.
`______________________
`
`Decided: April 12, 2017
`______________________
`
`ROBERT TRENCHARD, Gibson, Dunn & Crutcher LLP,
`New York, NY, argued for appellants. Appellant Novartis
`AG also represented by JANE M. LOVE; MICHAEL A. VALEK,
`Dallas, TX; ALEXANDER N. HARRIS, San Francisco, CA.
`
`JOSEPH M. O'MALLEY, JR., Paul Hastings LLP, New
`York, NY, for appellant Mitsubishi Pharma Corp. Also
`represented by ERIC WILLIAM DITTMANN.
`
`(cid:36)(cid:53)(cid:42)(cid:40)(cid:49)(cid:55)(cid:56)(cid:48)(cid:3)(cid:40)(cid:59)(cid:20)(cid:19)(cid:23)(cid:20)
`
`SUN - IPR2017-01929, Ex. 1041, p. 1 of 27
`
`
`
`TERESA STANEK REA, Crowell & Moring, LLP, Wash-
`ington, DC, argued for appellees. Appellee Apotex Inc.
`also represented by VINCENT JOHN GALLUZZO; JONATHAN
`M. LINDSAY, Irvine, CA.
`
`MICHAEL K. LEVY, Andrews Kurth Kenyon LLP, New
`York, NY, for appellee Torrent Pharmaceuticals Limited.
`
`SHANNON BLOODWORTH, Perkins Coie, LLP, Washing-
`ton, DC, for appellee Mylan Pharmaceuticals Inc. Also
`represented by BRANDON MICHAEL WHITE; DAN L.
`BAGATELL, Hanover, NH.
`______________________
`
`Before TARANTO, CHEN, and STOLL, Circuit Judges.
`CHEN, Circuit Judge.
`This is an appeal from the Final Written Decision of
`the United States Patent and Trademark Office, Patent
`Trial and Appeal Board (Board) in two consolidated inter
`partes review (IPR) proceedings of U.S. Patent No.
`8,324,283 (the ’283 patent), owned by Novartis AG and
`Mistubishi Tanabe Pharma Corp. (collectively, Novartis).
`The Board instituted IPRs on all claims of the ’283 patent
`based on petitions filed by Torrent Pharmaceuticals
`Limited, Apotex, Inc. and Mylan Pharmaceuticals Inc.
`(collectively, Petitioners). After reviewing the claims,
`receiving extensive briefing, and hearing oral argument,
`the Board found all original claims of the ’283 patent and
`Novartis’ proposed substitute claims unpatentable as
`obvious. See Torrent Pharm. Ltd. v. Novartis AG, Nos.
`IPR2014-00784,
`IPR2015-00518, 2015 WL 5719630
`(PTAB Sept. 24, 2015) (Final Written Decision). Novartis
`raises a series of challenges to the Board’s analysis of the
`evidence and ultimate determination of unpatentability.
`For the reasons stated below, we affirm.
`
`SUN - IPR2017-01929, Ex. 1041, p. 2 of 27
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`
`
`BACKGROUND
`I.
`The ’283 patent relates to a solid pharmaceutical
`composition suitable for oral administration, comprising a
`sphingosine-1 phosphate (S1P) receptor agonist and a
`sugar alcohol, which the patent explains is useful for the
`treatment of certain autoimmune diseases such as multi-
`ple sclerosis. ’283 patent, col. 1, lines 11–14, 33–35; col.
`12, lines 19–49. According to the specification, S1P
`receptor agonists generally exhibit properties that make
`formulations suitable for oral administration of a solid
`composition difficult to create. However, “solid composi-
`tions comprising a sugar alcohol provide formulations
`which are particularly well suited to the oral administra-
`tion of S1P receptor agonists.” See id. at col. 1, lines 36–
`39. They also “provide a convenient means of systemic
`administration of S1P receptor agonists, do not suffer
`from the disadvantages of liquid formulations for injection
`or oral use, and have good physiocochemical and storage
`properties.” Id. at col. 1, lines 39–43. In such a composi-
`tion, the S1P receptor agonist is the active ingredient and
`the sugar alcohol acts as an excipient—the substance
`formulated alongside the active ingredient as a diluent,
`carrier, filler and/or bulking agent for the composition.
`See id. at col. 9, lines 53–54.
`The ’283 patent states that there are multiple known
`S1P receptor agonists appropriate for use in the claimed
`invention, set forth in the specification as formulas I–XIII.
`Id. at col. 1, line 51 to col. 8, line 4. The ’283 patent also
`states that a “particularly preferred S1P receptor agonist
`of formula I is FTY720, i.e., 2-amino-2-[2-(4-octylphenyl)
`ethyl]propane-1,3-diol in free form or in a pharmaceutical-
`ly acceptable salt form . . . .” Id. at col. 8, lines 23–26.
`FTY720 is also known as fingolimod. The ’283 patent
`further discloses that the specific sugar alcohol used in
`the claimed composition “may suitably be mannitol,”
`
`SUN - IPR2017-01929, Ex. 1041, p. 3 of 27
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`
`
`because of its non-hygroscopic properties (i.e., it is not
`likely to absorb moisture, which is beneficial in manufac-
`turing solid oral pills). Id. at col. 9, lines 53–54.
`Claims 1 and 19 of the ’283 patent are the only inde-
`pendent claims and are illustrative of the claimed subject
`matter:
`1. A solid pharmaceutical composition suitable for
`oral administration, comprising:
`(a) a S1P receptor agonist which is select-
`ed
`from
`2-amino-2-[2-(4-octylpheny
`l)ethyl]propane-1,3-diol, 2-amino-2-[4-(3-
`benzyloxyphenoxy)-2-chloropheny
`l]propyl-1,3-propane-diol, 2-amino-2-[4-(3-
`benzyloxyphenylthio)-2-
`chlorophenyl]propyl-1,3-propane-diol, or 2-
`amino-2-[4-(3-benzyloxyphenylthio)-2-
`chlorophenyl]-2-ethyl-1,3-propane-diol,
`and its phosphates or a pharmaceutically
`acceptable salt thereof; and
` (b) a sugar alcohol.
`19. A solid pharmaceutical composition suitable
`for oral administration, comprising mannitol and
`2-amino-2-[2-(4-octylphenyl)ethyl]propane-1,3-diol
`or a pharmaceutically acceptable salt thereof.
`Id. at col. 17, lines 2–11; col. 18, lines 7–10. Thus, claim 1
`is directed towards a solid oral composition comprised of
`the combination of one of a handful of S1P receptor ago-
`nists and any sugar alcohol, whereas claim 19 is directed
`towards the specific combination of fingolimod and man-
`nitol in a solid oral composition.
`The dependent claims are directed towards various re-
`finements of the composition, including for example, the
`addition of a lubricant:
`
`SUN - IPR2017-01929, Ex. 1041, p. 4 of 27
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`
`
`20. A composition according to claim 19, further
`comprising a lubricant.
`Id. at col. 18, lines 11–12. Other claims are directed
`towards adjusting the respective amount of ingredients:
`22. A composition according to claim 19, wherein
`the
`compound
`2-amino-2-[2-(4-
`octylphenyl)ethyl]propane-1,3-diol, or a pharma-
`ceutically acceptable salt thereof, is present in an
`amount of 0.5 to 5% by weight, based on the total
`weight of the composition.
`23. A composition according to claim 19, wherein
`mannitol is present in an amount of 90 to 99.5%
`by weight, based on the total weight of the compo-
`sition.
`Id. at col. 18, lines 15–22.
`While the application leading to the ’283 patent was
`pending at the Patent Office, Novartis applied to the U.S.
`Food and Drug Administration (FDA) for approval to sell
`a fingolimod-mannitol pill to treat multiple sclerosis
`under the “Gilenya” brand name. The FDA approved
`Gilenya for the treatment of multiple sclerosis in 2010.
`II.
`On May 27, 2014, Torrent filed a petition to institute
`an inter partes review of claims 1–32 of the ’283 patent.
`Torrent’s petition presented three separate patentability
`challenges:
`1. claims 1–32 are unpatentable as obvious over
`the combination of U.S. Patent No. 6,004,565
`(Chiba) and Pharmaceutics: The Science of Dosage
`Form Design (Aulton); and
`2. claims 1–4, 7, 8, 19, 22 and 32 are unpatenta-
`ble as anticipated by U.S. Patent No. 6,277,888
`(Sakai); and
`
`SUN - IPR2017-01929, Ex. 1041, p. 5 of 27
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`
`
`3. claims 1–32 are unpatentable as obvious over
`Chiba and Sakai.
`Chiba teaches the use of immunosuppressive com-
`pounds with fingolimod as the preferred species. J.A.
`18442.1 Chiba also teaches that these immunosuppres-
`sive compounds are useful for treating “autoimmune
`diseases such as . . . multiple sclerosis,” among other
`diseases and conditions. J.A. 18443. Chiba goes on to
`disclose oral administration of fingolimod, including
`“admix[ing] with [a] carrier, excipient, diluent, and so on
`and formulat[ion] into . . . capsules [or] tablets . . . for
`administering to patients.” J.A. 18444. In discussing the
`preparation of these capsules and tablets for oral admin-
`istration of fingolimod, Chiba teaches that “pharmaceuti-
`cally or physiologically acceptable carriers or excipients
`for use with the . . . compounds noted herein are known in
`the art or can be readily found by methods and tests
`known in the art.” J.A. 18446. In other words, Chiba
`teaches a solid oral composition of fingolimod combined
`with a generic excipient.
`Aulton teaches the use of tablets and capsules to ad-
`minister drugs orally. J.A. 19041. It specifically teaches
`that “[t]he successful formulation of a stable and effective
`solid dosage form depends on the careful selection of the
`excipients which are added to facilitate administration,
`promote the consistent release and bioavailability of the
`drug and protect it from degradation.” J.A. 19066–167.
`Aulton recommends mannitol as a common diluent used
`in “[t]ableting by the wet granulation process,” which
`Aulton describes as “the most widely used method for
`pharmaceutical materials.” J.A. 19074–77. Aulton de-
`scribes mannitol as “expensive,” but “commonly used” as
`an excipient in solid oral compositions. J.A. 19077.
`
`1 Citations to “J.A. ____” refer to the Joint Appendix
`filed by the parties.
`
`SUN - IPR2017-01929, Ex. 1041, p. 6 of 27
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`
`
`Sakai describes a pharmaceutical composition con-
`taining fingolimod as an active ingredient. J.A. 18421.
`More particularly, Sakai discloses that the composition
`can be formulated into a liquid preparation, or can be a
`solid lyophilized (freeze-dried) product. J.A. 18421–22.
`Sakai further discloses that the addition of a saccharide,
`such as sugar alcohol, to the composition can result in a
`less irritating resulting liquid solution. J.A. 18421. Sakai
`discloses a list of eight exemplary saccharides, including
`mannitol. J.A. 18422. The saccharide, such as mannitol,
`can be dissolved in the liquid for dissolution, or alterna-
`tively may be contained in the lyophilized product along
`with the active ingredient. J.A. 18422. Sakai teaches
`that this liquid pharmaceutical composition can be used
`for immunosuppression in connection with organ or bone
`marrow transplantation, autoimmune diseases, or allergic
`diseases. Id. In short, Sakai teaches the specific combi-
`nation of fingolimod and mannitol for a liquid formula-
`tion.
`
`III.
`On December 1, 2014, the Board granted in part Tor-
`rent’s petition and instituted trial to review patentability
`of the challenged claims in IPR2014-00784. Specifically,
`the Board instituted on the first ground, the combination
`of Chiba and Aulton, but declined to institute on grounds
`two or three. The Board found that Chiba discloses the
`use of fingolimod in a solid formulation for oral admin-
`istration when combined with conventional excipients. It
`then found that Aulton teaches the use of mannitol as a
`conventional excipient that a person of skill in the art
`would have looked to when formulating a solid composi-
`tion with fingolimod.
`The Board found Sakai to be an improper anticipatory
`reference because the reference does not describe a solid
`composition suitable for oral administration. It then
`rejected the grounds predicated on the combination of
`
`SUN - IPR2017-01929, Ex. 1041, p. 7 of 27
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`
`
`Chiba and Sakai for similar reasons, noting that, unlike
`Aulton, “Sakai does not identify mannitol as a ‘conven-
`tional excipient’ in solid pharmaceutical compositions,
`and Sakai’s stated reasons for using mannitol in liquid
`pharmaceutical compositions are
`inapplicable to
`its
`potential use in connection with solid pharmaceutical
`compositions.” J.A. 72.
`Apotex and Mylan thereafter filed a separate petition
`seeking to institute an IPR of claims 1–32 of the ’283
`patent based on the already-instituted Chiba/Aulton
`grounds and requested joinder with the Torrent proceed-
`ings. On February 17, 2015, the Board instituted trial in
`this follow-on proceeding in IPR2015-00518 and joined it
`with the Torrent proceeding.
`After briefing and oral argument, the Board issued its
`Final Written Decision in the consolidated proceeding.
`The Board concluded that Chiba and Aulton collectively
`teach each limitation of claims 1–32 of the ’283 patent. It
`first addressed claim 19, directed towards the specific
`combination of fingolimod and mannitol. The Board
`found that Chiba and Aulton together strongly suggested
`the claimed two-ingredient combination:
`First, Chiba teaches that a person of ordinary
`skill in the art would have been able to identify or
`easily determine excipients that would have been
`compatible with fingolimod . . . (“pharmaceutically
`or physiologically acceptable carriers or excipients
`for use with the . . . compounds noted herein are
`known in the art or can be readily found by meth-
`ods and tests known in the art”). Second, Aulton
`teaches that mannitol is not only a known diluent
`for direct compression manufacturing, but also
`commonly used in wet granulation, which Aulton
`teaches is “the most widely used method for
`pharmaceutical materials.” . . . This combination
`of teachings already strongly suggests that man-
`
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`
`
`nitol likely would have been a target of investiga-
`tion for a person of ordinary skill in the art inter-
`ested in finding an excipient compatible with
`fingolimod . . . .
`Final Written Decision, 2015 WL 5719630, at *8. After
`finding that the two references themselves strongly
`suggested the claimed invention, the Board expressly
`found “additional evidence of the reason to combine
`fingolimod and mannitol.” Id. First, the Board noted that
`Sakai “directly instructs that the two ingredients should
`be combined.” Id. Although Novartis argued in its briefs
`below that Sakai’s teaching is narrowly limited to liquid-
`phase pharmaceutical compositions, as opposed to the
`claimed solid oral dosage forms, the Board observed that
`Novartis’ own expert, Dr. Stephen Byrn, had written an
`article describing how “solution studies can be very help-
`ful” in understanding drug degradations in the solid state.
`Id. Despite Novartis’ attempt to minimize the article’s
`meaning, the Board concluded that “a suggestion to
`combine ingredients in the liquid phase would have been
`relevant to the determination of a person of ordinary skill
`in the art to combine the same ingredients in the solid
`phase.” Id.
`Acknowledging that it had denied instituting the IPR
`based on Sakai alone (per § 102) or in combination with
`Chiba (per § 103), the Board distinguished its final deci-
`sion’s usage of Sakai, explaining that its final decision
`simply relied on Sakai as a background reference that
`offered additional motivation evidence to combine Chiba
`with Aulton. The Board explained that even though
`Sakai did not “teach that mannitol is a conventional
`excipient for use in solid pharmaceutical compositions,”
`id., the record evidence relating to Dr. Byrn’s article,
`which was debated by the parties, supported a finding
`that “Sakai’s teaching would have been relevant to the
`decision on which excipient to use in formulating a solid
`oral dosage form of fingolimod.” Id.
`
`SUN - IPR2017-01929, Ex. 1041, p. 9 of 27
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`The Board went on to find that several additional
`background references in the proceeding demonstrate
`that mannitol provides advantages when used as a dilu-
`ent in tableting, further supporting a reason to combine.
`The Board concluded its motivation to combine analysis:
`Given (1) the knowledge in the art that mannitol
`provided advantages in formulating tablets gen-
`erally, (2) Chiba’s teaching that a person of ordi-
`nary skill in the art would have been able to
`identify or easily determine excipients that would
`have been compatible with fingolimod, (3) Aulton’s
`teaching that mannitol was a diluent commonly
`used in the most common form of pharmaceutical
`manufacture, (4) Sakai’s teaching that mannitol
`and fingolimod should be combined in the liquid
`phase, and (5) Dr. Byrn’s statement that liquid-
`phase compatibility was relevant to the prediction
`of solid-phase compatibility, we conclude that Pe-
`titioners have shown a reason to combine the
`teachings of Chiba and Aulton.
`Id. at *9.
`The Board next turned to the objective indicia of non-
`obviousness. First, it found that independent claims 1
`and 19 were “not commensurate in scope” with the pur-
`ported unexpected result of fingolimod’s low concentration
`stability when combined with mannitol, because the
`independent claims are “not limited to any particular dose
`or dose range of fingolimod.” Id. at *10. Therefore, the
`Board concluded, “even if the stability of the mannitol-
`fingolimod combination at low doses was unexpected, it is
`insufficient to support a legally significant finding of
`unexpected results.” Id. at *11. The Board also rejected
`Novartis’ long-felt but unsolved need, industry praise, and
`commercial success arguments because all of Novartis’
`proffered evidence was directed solely toward the fact that
`
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`Gilenya was a solid oral multiple sclerosis treatment,
`which was already known in the prior art.
`The Board then analyzed the dependent claims in
`turn. Relevant to this appeal, the Board turned to de-
`pendent claims 8, 10, 22, and 23, and proposed amended
`claims 40, 42, 54, and 55, directed towards concentrations
`with low percentages of fingolimod by weight. The Board
`found that “Petitioners provide evidence that the selection
`of the relative amounts of the constituents of the claimed
`formulation is the result of routine optimization.” Id. at
`*16. It further noted, “[w]e have not been directed to any
`evidence of record contradicting this evidence, so we find
`that a person of ordinary skill in the art familiar with
`Chiba and Aulton would have been able and motivated to
`optimize the amount of fingolimod . . .” Id.
`In conclusion, the Board held every claim unpatenta-
`ble as obvious and denied Novartis’ motion to amend for
`essentially the same reasons it rejected the original
`claims. Appellants timely appealed. We have jurisdiction
`under 28 U.S.C. § 1295(a)(4)(A).
`DISCUSSION
` We review Board decisions using the standard set
`forth in the Administrative Procedure Act (APA), 5 U.S.C.
`§ 706. In re Sullivan, 362 F.3d 1324, 1326 (Fed. Cir.
`2004) (citing Dickinson v. Zurko, 527 U.S. 150, 154
`(1999)); see also Belden Inc. v. Berk–Tek LLC, 805 F.3d
`1064, 1080 (Fed. Cir. 2015). Under the APA, we must
`“hold unlawful and set aside agency action . . . not in
`accordance with law [or] . . . without observance of proce-
`dure required by law.” 5 U.S.C. § 706.
`We review the Board’s legal conclusions de novo but
`review for substantial evidence any underlying factual
`determinations. See Nike, Inc. v. Adidas AG, 812 F.3d
`1326, 1332 (Fed. Cir. 2016); In re Giannelli, 739 F.3d
`1375, 1378–79 (Fed. Cir. 2014). Substantial evidence is
`
`SUN - IPR2017-01929, Ex. 1041, p. 11 of 27
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`“such relevant evidence as a reasonable mind might
`accept as adequate to support a conclusion.” Consol.
`Edison Co. v. NLRB, 305 U.S. 197, 229 (1938); see In re
`Applied Materials, Inc., 692 F.3d 1289, 1294 (Fed. Cir.
`2012).
`On appeal, Novartis first contends that the Board vio-
`lated the APA when it relied on Sakai in the Final Writ-
`ten Decision without affording Novartis proper notice and
`a chance to be heard. Novartis goes on to argue that the
`Board also erred on the merits, specifically in its analysis
`of the motivation to combine evidence and in its treat-
`ment of the alleged objective indicia of nonobviousness.
`I.
`APA Due Process
`We first turn to Novartis’ argument that the Board
`violated the requirements of notice and an opportunity to
`respond found in the APA when it used the Sakai refer-
`ence as part of its motivation to combine analysis in the
`Final Written Decision. According to Novartis, the Board
`ruled Sakai entirely out of the case in the Institution
`Decision, and on that basis, denied institution of the two
`proposed grounds based on Sakai. Novartis contends that
`it relied on that ruling and consequently submitted a
`“vastly different” record than it would have if it had
`known Sakai was still a live issue.
`In a formal adjudication, such as an IPR, the APA im-
`poses certain procedural requirements on the agency.
`The Patent and Trademark Office, including the Board,
`must provide the patent owner with timely notice of “the
`matters of fact and law asserted,” and an opportunity to
`submit facts and argument. 5 U.S.C. §§ 554(b)–(c), 557(c);
`Dell Inc. v. Acceleron, LLC, 818 F.3d 1293, 1301 (Fed. Cir.
`2016). The notice and opportunity to be heard provisions
`of the APA have been applied “to mean that ‘an agency
`may not change theories in midstream without giving
`respondents reasonable notice of the change’ and ‘the
`opportunity to present argument under the new theory.’”
`
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`Belden, 805 F.3d at 1080 (quoting Rodale Press, Inc. v.
`FTC, 407 F.2d 1252, 1256–57 (D.C. Cir. 1968)). In this
`case we conclude that the relevant APA provisions were
`satisfied.
`
`A.
`We first disagree with Novartis that the Board ruled
`Sakai out of the case entirely in the Institution Decision.
`In the Institution Decision, the Board declined to read
`Sakai as an anticipatory reference or primary obviousness
`reference because Sakai does not disclose “mannitol as a
`‘conventional excipient’ in solid pharmaceutical composi-
`tions, and Sakai’s stated reasons for using mannitol in
`liquid pharmaceutical compositions are inapplicable to its
`potential use in connection with solid pharmaceutical
`compositions.” J.A. 72. In other words, although Sakai
`discloses the combination of fingolimod and mannitol, it
`does not expressly disclose the combination in a solid
`pharmaceutical composition nor does its teaching of a
`liquid composition necessarily translate to a solid oral
`composition.
`This conclusion, however, is not contrary to the
`Board’s discussion of Sakai in the Final Written Decision
`that Sakai’s teachings would have nevertheless been
`relevant to one of skill in the art in deciding which excipi-
`ents to use in formulating a solid oral dosage form of
`fingolimod. Having already found that Chiba and Aulton
`strongly suggest the combination of fingolimod and man-
`nitol in a solid oral composition, the Board found that
`Sakai merely reinforced its finding that the person of
`ordinary skill in the art would have expected mannitol to
`be compatible with fingolimod because Sakai discloses a
`stable combination of these two ingredients suitable for
`long-term preservation. The Board’s discussion of Sakai
`in the Final Written Decision was not inconsistent with
`its review of Sakai in the Institution Decision.
`
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`B.
`We also reject as unfounded Novartis’ complaints of
`“surprise” and contention that, following the Institution
`Decision, the parties “paid Sakai scant attention in sub-
`sequent proceedings.” The parties debated Sakai at
`length throughout the proceeding and in the same context
`that it was discussed by the Board in the Final Written
`Decision.
`As an initial matter, we note that in addition to as-
`serting Sakai as a primary reference, Torrent’s petition
`also argued that several references, including Sakai,
`further support the motivation to combine the teachings
`of Chiba and Aulton. Specifically, Torrent argued in
`connection with the combination of Chiba and Aulton that
`“Sakai (Ex. 1005) reinforced the expectation to the ordi-
`narily-skilled artisan that mannitol would have been
`compatible with FTY720 [fingolimod] because Sakai
`discloses pharmaceutical injectable compositions contain-
`ing FTY720 [fingolimod] and mannitol in solution, as well
`as lyophilized product meant for long-term preservation
`in vials containing FTY720 [fingolimod] and mannitol.”
`J.A. 6832. And in support of their petition, Apotex and
`Mylan also explained that Sakai would direct the person
`of ordinary skill in the art to the combined teachings of
`Chiba with Aulton. It reiterated the argument raised in
`the Torrent petition that the ordinarily skilled artisan
`would have naturally considered mannitol because of its
`known compatibility with fingolimod, again citing Sakai’s
`disclosure of a stable composition comprised of these two
`ingredients.
`Following institution of the Apotex/Mylan proceeding
`and joinder with the Torrent proceeding, the relevance of
`Sakai’s compatibility-disclosure to support a motivation to
`combine Chiba and Aulton was an ongoing, debated issue
`that Novartis addressed directly, on multiple occasions.
`In its Patent Owner’s Response, Novartis specifically
`
`SUN - IPR2017-01929, Ex. 1041, p. 14 of 27
`
`
`
`argued that Petitioners’ reliance on Sakai’s stability-
`disclosure in connection with the motivation to combine
`inquiry lacked merit because Sakai is relevant only to
`liquid compositions. Petitioners continued to press the
`issue in their Reply, contending that Sakai “would have
`provided a [person of skill in the art] with a reasonable
`expectation that mannitol is compatible with fingolimod.”
`J.A. 7782.
`Furthermore, both Petitioners’ expert and Novartis’
`expert went into significant detail in their post-institution
`declarations discussing Sakai and its applicability to the
`motivation to combine inquiry. Novartis’ counsel then
`questioned Petitioners’ expert at length about Sakai. And
`Novartis’ submitted Observations on Cross Examination
`repeatedly explained why Sakai did not support Petition-
`ers’ motivation to combine argument. At the hearing,
`both parties submitted demonstrative slides dedicated to
`Sakai and spent considerable attention discussing Sakai’s
`relevance as a background reference supporting the
`motivation to utilize mannitol with fingolimod in an oral
`formulation. Based on this record, it is quite clear that
`Novartis had more than sufficient notice and opportunity
`to be heard on Sakai’s potential relevance, and in fact
`actively and repeatedly attempted to distinguish Sakai to
`defeat the very argument relied on by the Board in the
`Final Written Decision.
`
`In sum, we reject Novartis’ contention to this court
`that it believed Sakai was not at issue in the proceeding.2
`For this reason we reject Novartis’ APA challenge.
`
`Indeed, had Novartis believed the Board eliminat-
`2
`ed Sakai from the proceeding, it had various procedural
`mechanisms at its disposal to respond to any perceived
`impropriety with Petitioners’ continued reliance on the
`reference. In particular, Novartis could have moved to
`
`SUN - IPR2017-01929, Ex. 1041, p. 15 of 27
`
`
`
`C.
`Finding no APA violation for the reasons discussed
`above, we nevertheless also reject Novartis’ characteriza-
`tion of Sakai as the “missing link” in the Board’s obvious-
`ness analysis. Contrary to Novartis’ contention, Sakai
`was discussed by the Board as one of several independent
`grounds supporting the motivation to combine fingolimod
`and mannitol in a solid oral composition. In finding a
`motivation to combine, the Board explained that the
`teachings of Chiba and Aulton alone “already strongly
`
`exclude the Sakai reference. See Genzyme Therapeutic
`Prods. v. Biomarin Pharm. Inc., 825 F.3d 1360, 1368 (Fed.
`Cir. 2016). We find meritless Novartis’ argument that it
`did in fact move to exclude Sakai from the proceeding.
`See Oral Arg.
`at
`53:30–53:51:
`available
`at
`http://oralarguments.cafc.uscourts.gov/default.aspx?fl=20
`16-1352.mp3. Although not provided in the Joint Appen-
`dix, Novartis’ counsel invited the court to review its
`motion to exclude. That invitation, unfortunately, led the
`court on a road to nowhere. In its motion, Novartis moved
`to exclude over fifty exhibits, including Sakai, all identi-
`fied by exhibit number only and listed in one long string
`cite, based on one conclusory sentence: “Petitioners rely
`on numerous exhibits that are incomplete and/or irrele-
`vant to the sole issue for review identified by the Board –
`i.e., (non)obviousness of the ’283 Patent in light of Chiba
`over Aulton).” Patent Owner’s Motion to Exclude at 20,
`Paper No. 73. This superficial treatment amounts to little
`more than a request that the Board peruse the cited
`evidence and piece together a coherent argument on
`Novartis’ behalf. It is far from sufficient to raise a mean-
`ingful challenge to any of the several dozen exhibits, let
`alone to sensitize the Board to the complained-of use of
`Sakai in particular.
`
`
`SUN - IPR2017-01929, Ex. 1041, p. 16 of 27
`
`
`
`suggests that mannitol likely would have been a target of
`investigation for a person of ordinary skill in the art
`interested in finding an excipient compatible with fin-
`golimod.” Final Written Decision, 2015 WL 5719630, at
`*8.
`
`Nevertheless, the Board continued to bolster its anal-
`ysis with “additional evidence of the reason to combine
`fingolimod and mannitol.” Id. And Sakai’s teaching to
`combine fingolimod and mannitol was just one of those
`additional reasons. The Board further explained that
`“[i]n addition to the direct teaching in Sakai that manni-
`tol and fingolimod should be combined, several documents
`that would have been known to a person of ordinary skill
`in the art teach that mannitol provides advantages when
`used as a diluent in tableting.” Id. at *9. The Board went
`on to explain that these references—all unchallenged on
`appeal—describe known advantages of using mannitol as
`an excipient in solid oral compositions that “provide a
`strong reason to combine Chiba’s teaching of a solid oral
`dosage form of fingolimod and Aulton’s teaching of manni-
`tol as an excipient for making solid oral dosage forms.”
`Id. These additional references are also substantial
`evidence supporting the Board’s motivation to combine
`conclusion, independent of Sakai. This is not a case
`where Sakai provided the linchpin of the Board’s analysis,
`as Novartis contends.
`For all these reasons, we find no violation of the APA
`with respect to the Board’s discussion of Sakai in the
`Final Written Decision.
`OBVIOUSNESS
`II.
`We turn to Novartis’ remaining challenges to the
`Board’s obviousness analysis.
`Obviousness is a mixed question of fact and law. The
`Board’s ultimate conclusion that the claims are not obvi-
`ous is a legal determination subject to de novo review,
`
`SUN - IPR2017-01929, Ex. 1041, p. 17 of 27
`
`
`
`however, the subsidiary factual findings are reviewed for
`substantial evidence. In re Gartside, 203 F.3d 1305, 1316
`(Fed. Cir. 2000). Motivation to combine is one of those
`underlying factual issues. Id. (“The presence or absence
`of a motivation to combine references in an obviousness
`determination is a pure question of fact.”). Whether
`objective indicia support a finding of nonobviousness is
`also a factual question. Merck & Cie v. Gnosis S.P.A., 808
`F.3d 829, 833 (Fed. Cir. 2015).
`A. Motivation to Combine
`Novartis argues that the Board further erred in its
`motivation to combine analysis because it failed to read
`the prior art as a whole and overlooked critical evidence of
`mannitol’s known disadvantages as an excipient for solid
`compositions. In particular, Novartis argues that it
`pointed out mannitol’s negative properties, including
`difficulty to manufacture, the existence of impurities, and
`expense. Because the Board did not expressly state that
`it was weighing all of these negatives against mannitol’s
`positives, Novartis contends that the Board’s motivation
`to combine analysis was legally flawed. In support of its
`contention, Novartis directs the court to Medichem, S.A.
`v. Rolabo, S.L., 437 F.3d 1157 (Fed. Cir. 2006). In Medi-
`chem, this court explained that “[w]here the prior art
`contains ‘apparently conflicting’ teachings (i.e., where
`some references teach the combination and others teach
`away from it) each reference must be considered ‘for its
`power to suggest solutions to an artisan of ordinary skill .
`. . consider[ing] the degree to which one reference might
`accurately discredit another.’” Id. at 1165 (quoting In re
`Young, 927 F.2d 588, 591 (Fed. Cir. 1991)).
`Contrary to Novartis’ conten
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