# Appendix — Dr. Reddy's Laboratories, Ltd. v. Eli Lilly and Co. (Nos. 06-1723, 06-1642) > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386008_1138%3A2 ## Record - **Collection:** Supreme Court brief - **Document type:** Appendix - **Published:** January 1, 2007 ## Text la APPENDIX A — OPINION OF THE UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT DECIDED DECEMBER 26, 2006 UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT 05-1396, -1429, -1430 ELI LILLY AND COMPANY and LILLY INDUSTRIES LIMITED, Plaintiffs-Appellees, V. ZENITH GOLDLINE PHARMACEUTICALS, INC. (now known as Ivax Pharmaceuticals, Inc.), Defendant-Appellant, and TEVA PHARMACEUTICALS USA, INC., Defendant-Appellant, and DR. REDDY’S LABORATORIES, LTD., Defendant-Appellant. DECIDED: December 26, 2006 2a oe Appendix A Before RADER, SCHALL, and GAJARSA, Circuit Judges. RADER, Circuit Judge. Zenith Goldline Pharmaceuticals, Inc. (now known as IVAX Pharmaceuticals, Inc.) (IVAX); Dr. Reddy’s Laboratories, Ltd. (DRL); and Teva Pharmaceuticals USA, Inc. (Teva) (defendants), filed an Abbreviated New Drug Application (ANDA). In response, the plaintiffs, Eli Lilly and Company and Lilly Industries Ltd. (collectively Lilly), filed suit against all defendants for infringement of United States Patent No. 5,229,382 (°382 patent). Following a two and one-half week bench trial, the United States District Court for the Southern District of Indiana found the ’382 patent valid and infringed. Eli Lilly & Co. v. Zenith Goldline Pharm., 364 F.Supp.2d 820 (S.D.Ind.2005) (Final Judgment); Eli Lilly & Co. v. Zenith Goldline Pharm., 1:01- cv-443-RLY-VSS (S.D.Ind. May 9, 2005) (Amended Final Judgment ). In 221 pages of written analysis, the trial court _ documented its findings and conclusions. Eli Lilly & Co. v. Zenith Goldline Pharm., 364 F.Supp.2d 820 (S.D.Ind.2005) (Findings of Fact and Conclusions of Law ). The defendants appeal the trial court’s conclusions on the validity of the ’382 patent and inequitable conduct. Finding no reversible error, this court affirms. I. The °382 patent claims both olanzapine and use of the compound to treat schizophrenia. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 830. A Lilly research chemist first synthesized olanzapine in the United Kingdom 3a Appendix A in 1982. Jd. at 834. Lilly filed the °382 patent application on May 22, 1992. The patent issued on July 20, 1993. The United States Food and Drug Administration (FDA) approved olanzapine, sold by Lilly under the trademark Zyprexa®, in late 1996. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 830. By filing an ANDA, the defendants stipulate to infringement if the °382 patent is valid and enforceable. Amended Final Judgment, slip op. at 1. Claims 1, 2, 3, 7, 8, and 15 of the °382 patent set forth the boundaries of the invention: 1. 2-Methyl-10-(4-methyl-1-piperaziny])- 4H-thieno[2,3-b][1,5]benzodiazepine, or an acid addition salt thereof. 2. A pharmaceutical composition comprising a compound according to claim 1 or a pharmaceutically acceptable acid addition salt thereof together with a pharmaceutically acceptable diluent or carrier therefor. 3. A pharmaceutical composition in capsule or tablet form comprising from 2.5 to 5 mg of the compound of claim 1 together with a pharmaceutically acceptable diluent or carrier therefor. ** * * 7. Amethod of claim 5 for treating an animal, including a human, suffering from or susceptible to schizophrenia. 4a Appendix A 8. A method of claim 7 wherein the effective amount is from 0.1 to 20 mg per day of 2-methyl- 10-(4-methy]-1-piperaziny!)-4H-thieno[2,3-b] [1,5]benzodiazepine, or a pharmaceutically acceptable acid addition solution salt thereof. * * * * 15. A pharmaceutical composition in capsule or tablet form comprising from 0.1 to 20 mg of the compound of claim | together with a pharmaceutically acceptable diluent or carrier therefor. *382 patent, col. 12, Il. 10-20, Il. 33-40, Il. 64-67. Before discovery of olanzapine, Lilly discovered other drugs in the same _ family of compounds (thienobenzodiazepines), namely clozapine, flumezapine, ethyl flumezapine and ethy! olanzapine (a.k.a. Compound °222). Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 831-33. These compounds share a common Sa Appendix A structural nucleus as thienobenzodiazepines, namely a piperazine ring (R), a benzene ring (R1), and a thiophene ring (R2). a og g?.. Benzo ' Diazepine: Thiophene Lilly used clozapine to treat some forms of schizophrenia in the late °60s and early ’70s. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 831. Clozapine was thus the first “atypical” antipsychotic drug. Structurally, olanzapine differs from clozapine in that olanzapine has a methyl-substituted thiophene ring in place of the benzene ring in clozapine. /d. at 846-47. Olanzapine also has hydrogen in place of the chlorine on its benzene ring. Jd. at 847. Despite its advantages, researchers discovered in 1975 that clozapine caused an often fatal blood disorder (agranulocytosis) in one percent of patients. For that reason, Lilly withdrew clozapine from the market. Jd. Nevertheless, after a general failure to replace clozapine, reflected by many 6a Appendix A documented reports of promising compounds that failed either for lack of efficacy or toxic side-effects, the FDA, in late 1989, approved clozapine with careful blood-monitoring. Id. at 832. Until discovery of olanzapine, researchers attributed the efficacy of clozapine and typical antipsychotics to their “neuroleptic substituent”-an electron-withdrawing group considered important to the antipsychotic activity of the compounds. /d. Halogen-a fluorine (F) or chlorine (Cl) atom- is such an electron withdrawing group. /d. at 832, 850. Olanzapine does not have a halogen atom, i.e. a fluorine (F) or chlorine (C1) J atom. Instead, it has a so hydrogen atom (H), which is not an 3 electron withdrawing Olanzapine (or electronegative) group. /d. at 850. Reak The prior art to olanzapine includes ethyl flumezapine and flumezapine, both disclosed in U.S. Patent No. 4,115,574 (°574 patent) that issued in 1978. The prior art also includes ethyl olanzapine (a.k.a. Compound ’222). Ethyl flumezapine caused widespread blood problems in dogs. /d. at 847. Flumezapine caused extra-pyramidal symptoms (EPS) and an increase in liver enzymes and a muscle enzyme called creatine phosphokinase (CPK). Ethyl olanzapine caused a 7a Appendix A significant increase in cholesterol] in female beagle dogs. /d. Thus, the prior art to olanzapine had significant detrimental side effects. Olanzapine differs structurally yor from flumezapine, by —~ substitution of a hydrogen atom (H) for the fluorine atom (F) 4 in flumezapine at the 7-position of the Flumezapine benzene ring. 7d. Olanzapine differs structurally CH, from ethyl pm—N flumezapine by "il replacement of the 2 fluorine atom (F) and ethyl group (CH,CH,) t CHCH, in ethyl flumezapine with a hydrogen atom (H) and methy! group Ethyl Flumezapine (CH,) respectively. /d. > 8a Appendix A Olanzapine differs structurally << from its ethyl analog, eng Compound °222 (ethyl olanzapine), by Le @ Ze CHLH, replacement of the ethyl group (CH,CH,) with a methyl group (CH,) at the 2- Ethyl Olanzapine position of the (Compound ‘222) thiophene ring. /d. Cal I The trial court found that the defendants did not prove by clear and convincing evidence that claims 1, 2, 3, 7, 8, and 15 of the ’382 patent were invalid as anticipated under 35 U.S.C. § 102. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 922-23. The primary reference the defendants cited for anticipation of these claims is an article entitled“4-Piperazinyl-10H-thieno[2,3-5][1,5] benzodiazepines as Potential Neuroleptics” from the Journal of Medicinal Chemistry in 1980 ( Chakrabarti 1980a ). Jiban K. Chakrabarti, Linda Horsman, et al., 4-Piperazinyl-10H- thieno[{2,3-b] [1,5]benzodiazepines as Potential Neuroleptics, 23 J. Med. Chem. 8 (1980). Anticipation is a question of fact, including whether or not an element is inherent in the prior art. See In re Schreiber, 128 F.3d 1473, 1477 (Fed.Cir.1997). Therefore, this court reviews a finding of anticipation under the clearly erroneous standard. Atlas Powder Co. v. Ireco, Inc., 190 F.3d 1342, 1346 (Fed.Cir. 1999). To anticipate, a prior art reference must 9a Appendix A place the inventive compound or composition in the possession of the public. Jn re Brown, 51 C.C.P.A. 1254, 329 F.2d 1006, 1011 (1964). Thus, the prior art reference must disclose each and every feature of the claimed invention, either explicitly or inherently. Glaxo Inc. v. Novopharm Ltd., 52 F.3d 1043, 1047 (Fed.Cir.1995). Pointing to Jn re Petering, 49 C.C.P.A. 993, 301 F.2d 676 (1962) and Jn re Schaumann, 572 F.2d 312 (C.C.P.A.1987), IVAX asserts that Chakrabarti 1980a anticipated claim | of the 2382 patent because it identified compounds from the same family of compounds (thienobenzodiazepines). Indeed, in Petering, the Board of Patent Appeals affirmed the examiner’s rejection of claims 1, 2,4, 5, 7, and 10-12 of the patent applicant’s application on “isoalloxazines.” 301 F.2d at 677. However, in contrast to this case, the prior art in Petering did more than make a broad generic disclosure. In Petering, the prior art disclosed a limited number of specific preferences from a specifically defined group of isoalloxazines. /d. As a result, Petering actually disclosed to one skilled in the art a limited class of only “some 20 compounds,” including “6, 7-dimethyl-9- (Bmonohydroxyethy])-isoalloxazine.” Schaumann, 572 F.2d at 315 (citing Petering, 301 F.2d at 682). Similarly, the prior art in Schaumann disclosed 14 compounds, later further narrowed to 7, considering express preferences. Additionally, the structural formula of this prior art contained but a single variable. 572 F.2d at 314. Thus, in Schaumann, the prior art patent embraced a very limited number of closely related compounds and specifically described the claimed compound. 572 F.2d at 316. Thus, 10a Appendix A unlike this case, the prior art in both Petering and Schaumann expressly spelled out a definite and limited class of compounds that enabled a person of ordinary skill in the art to at once envisage each member of this limited class. Schaumann, 572 F.2d at 315; Petering, 301 F.2d at 681-82. By contrast, the number of compounds actually disclosed by Chakrabarti 1980a numbers in the millions (including all proposed alternative substituents). Chakrabarti 1980a examined forty-five specific compounds (as opposed to a genus of compounds) in the 4-piperazinyl-10H-thieno [2,3-b] [1,5]benzodiazepine family and fourteen analogous 5-piperazinyl-substituted 4H-thieno[2,3-b][1,4] benzodiazepines, which were created to compare activity. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 848. Indeed, Chakrabarti 1980a listed several preferred compounds and substituents, none of which resemble olanzapine: for R-a methyl, hydroxyethyl, or hydroxypropyl; for Rl-a fluorine, chlorine, or 7, 8, di-fluoro /no hydrogen]; and for R2-a methyl, 2-ethyl, or 2-isopropyl group. Id. at 848. Five of the preferred individual compounds (9, 12, 17, 29, and 34) are more potent than clozapine (scoring a3 CAR' or higher) and have clozapine-like effect. For those 1. Conditioned Avoidance Response (CAR): The CAR test evaluates the inhibition of a behavioral response in rats. The CAR (Cont'd) lla Appendix A five preferred compounds, the Chakrabarti 1980a authors expressed a preference for specific, complete compounds without any variation of the individual substituents on those molecules. Chakrabarti 1980a also always expressed a preference for halogen-containing compounds (fluorine or chlorine), not hydrogen. /d. at 832-33. Furthermore, compounds 9, 12, 17, and 29 all have fluorine at the 7- position of the benzene ring. And though Compound 34 does have hydrogen at the 7-position of the benzene ring, it has a hydroxyethyl on its piperazine ring, unlike olanzapine. /d. In sum, Chakrabarti 1980a discloses nothing close to the claimed invention. Chakrabarti 1980a does provide a general structural formula with possible substituents of “R,” “R1,” and “R2,” but it does not define them at all. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 900. No possible combination of those preferred substituents would lead to the components that make up olanzapine, because each would contain a fluorine or a chlorine. To make olanzapine from Chakrabarti 1980a, one would have to depart from the teaching of the article and recombine the components of the specific illustrative compounds with hindsight. Thus, Chakrabarti 1980a does not anticipate because: (1) the article prefers complete compounds, not individual substituents, (2) the article discloses no generic disclosure encompassing olanzapine or even stating that substituents on different compounds were interchangeable, and (3) the article does (Cont'd) test was the only measure of potential antipsychotic activity, and if the compound did not achieve a CAR score of three or four at a dose of less than 30 mg/kg, it was not considered active. 12a Appendix A not suggest transforming unpreferred compound 7? into a preferred can pound.Thus,Chakrabarti 1980a did not place olanzapine in the possession of the public. Therefore, this court detects no clear error in the trial court’s finding of no anticipation. Il The trial court found that the defendants did not prove by clear and convincing evidence that claims 1, 2, 3, 7, 8, and 15 of the °382 patent were invalid as obvious under 35 U.S.C. § 103. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 922-23. On appeal, IVAX argues that the district court erred by erecting “a threshold requirement that defendants establish a teaching or incentive to treat the closest prior art (i.e., Compound °222) as a ‘lead compound.’” IVAX also charges that the district court disregarded (1) the structural characteristic of olanzapine as the adjacent homolog of Compound °222, (2) the suggestions to delete fluorine from the prior art compound flumezapine, and (3) the observation that Compound °222 and flumezapine “bracket” olanzapine. This court reviews obviousness without deference as a legal conclusion with underlying factual determinations which are reviewed for clear error. Medichem, S.A. v. Rolabo, S.L., 437 F.3d 1157, 1164 (Fed.Cir.2006). The factual underpinnings are: (1) the scope and content of the prior art, 2. Furthermore, compound 7 (like compound °222) lacks the electron withdrawing “neuroleptic substituent” believed at that time to be necessary for antipsychotic efficacy. l3a Appendix A (2) the differences between the prior art and the claimed invention at the time of invention, (3) the level of ordinary skill in the art, and (4) the objective indicia of nonobviousness. See Graham vy. John Deere Co., 383 U.S. 1, 17, 86 S.Ct. 684, 15 L.Ed.2d 545 (1966); Panduit Corp. v. Dennison Mjg., 810 F.2d 1561, 1566-67 (Fed.Cir. 1987). For a chemical compound, a prima facie case of obviousness requires “structural similarity between claimed and prior art subject matter ... where the prior art gives reason or motivation to make the claimed compositions.” Jn re Dillon, 919 F.2d 688, 692 (Fed.Cir.1990) (en banc). “[A] reasonable expectation of success, not absolute predictability” supports a conclusion of obviousness. /n re Longi, 759 F.2d 887, 896 (Fed.Cir.1985). For the following reasons, the district court did not err in reaching its conclusion. As succinctly stated by the district court: 175. In light of the general state of the art, including the teachings of the °574 patent and Chakrabarti 1980a, Chakrabarti 1982, and Chakrabarti 1989, one of ordinary skill in the art would have expected that replacing the fluorine atom with a hydrogen atom would produce a compound without sufficient antipsychotic activity. Nichols Tr. 2776:5-11. 176. While Chakrabarti 1980a suggests that a chlorine atom in place of the fluorine atom would also enhance the compound’s activity, it does not specifically suggest that the same result l4a Appendix A could be obtained with a hydrogen atom. Nichols Tr. 2779: 17-24; TX 3465 at 879, col. 2. Nor does anything in Sullivan and Franklin suggest the desirability of using a hydrogen atom at this position. Nichols 2776:5-11; TX 3161; Findings of Fact § IV. B.I.d. /fone were looking to replace the fluorine, one would replace the fluorine with other electronegative groups, not hydrogen. TX 1315 at 3172; LaVoie Tr. 1572:12-1573:18. Indeed, the art as a whole teaches directly away from using hydrogen because it is not an electron- withdrawing substituent. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 850 (emphases added). Though the °574 patent disclosed Compound °222, the patent expressed a preference for halogen containing compounds and specifically those with a halogenated substituent on the benzene ring in a location analogous to the chlorine in clozapine. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 845. These teachings do not suggest or make obvious, among other things, olanzapine’s hydrogen component. The prior art references at the time of this invention taught away from using a non- halogenated compound as a substituent in the benzene ring, exactly where olanzapine has a hydrogen atom. Furthermore, the trial court found that a person of ordinary skill in the art would not have chosen Compound °222 as the beginning compound because it contained a hydrogen atom instead of a halogen atom, which again is not a preferred substituent. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 849-50. In addition, the prior art 15a Appendix A supplied no motivation to change the 2-ethyl in Compound °222 to a 2-methyl. The prior art would have instead suggested modification by adding a halogen atom-to supply the neuroleptic substituent as a trigger for antipsychotic activity. Jd. The district court found that, at the relevant time, a person with ordinary skill in the art would not have expected any reasonable chance of success with other clozapine-like compounds. /d. at 850-52. And though olanzapine is also the adjacent homolog of Compound ’222, patentability for a chemical compound does not depend only on structural similarity. Comm’r of Patents v. Deutsche Gold-und-Silber-Scheideanstalt Vormals Roessler, 397 F.2d 656 (D.C.Cir. 1968). This court will not ignore a relevant property of a compound in the obviousness calculus. Jn re Lalu, 747 F.2d 703 (Fed.Cir.1984). When claimed properties differ from the prior art, those differences, if unexpected and significant, may lead to nonobviousness. In re Mehta, 52 C.C.P.A. 1615, 347 F.2d 859 (1965); In re Grabiak, 769 F.2d 729 (Fed.Cir.1985). In this case, the trial court noted some structural similarity of olanzapine and the prior art, but also accounted for the unexpected beneficial properties in olanzapine. This case is similar in many respects to Yamanouchi Pharm. Co., Ltd. v. Danbury Pharmacal, Inc., 231 F.3d 1339, 1344 (Fed.Cir.2000). In Yamanouchi, this court held that the ANDA filer did not show obviousness of the famotidine compound: [The ANDA filer} did not show sufficient motivation for one of ordinary skill in the art at l6a Appendix A the time of invention to take any one of the following steps, let alone the entire complex combination: (1) selecting example 44 as a lead compound, (2) combining the polar tail from example 44 with the substituted heterocycle from tiotidine, and (3) substituting the carbamoyl (CONH2) group in the intermediate compound with a sulfamoyl group (SO2NH2) to create famotidine. Id. Likewise, in this case, the defendants have not shown that a person ordinarily skilled in this art would have selected Compound ’222 as a lead compound because it contained hydrogen rather than fluorine or chlorine. At the time of invention, the state of the art would have directed the person of ordinary skill in the art away from unfluorinated compounds like Compound ’222. After all, the primary example of the state of the art at that time, the °574 patent, did not provide any biological data for compound °222, suggested a preference for halogen-containing compounds, and identified a fluorine-containing compound, ethyl flumezapine, as “particularly active.” Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 904. Moreover, as the trial court detailed, Chakrabarti 1980a expressly taught that the addition of a fluorine or chlorine enhanced anti-psychotic activity. It also taught that the unfluorinated Compound ’222 was less active than the benchmark compound, clozapine. Id. Thus, rather than providing the requisite motivation, the prior art taught away from selecting Compound °222 as a lead compound for further development. 17a Appendix A Nevertheless, citing to an article entitled “Jn Vitro Thiomethylation: Studies with Flumezapine,” written by H.R. Sullivan and R.B. Franklin (S & F article), I1VAX argues that removal of fluorine from flumezapine would have resuited in a default to a hydrogen atom. H.R. Sullivan and R.B. Franklin, Jn Vitro Thiomethylation: Studies with Flumezapine, 13 Drug & Metabolism Disposition 276 (1985). To the contrary, however, the S & F article says nothing whatsoever about removal of fluorine. Specifically, the article discusses the metabolism of flumezapine in dogs that produces methylthio metabolite. Jd. The S & F article does not state that flumezapine is toxic or that the methylthio metabolite could be avoided by replacement of fluorine with hydrogen. As noted by the district court, the S & F article “does not teach that replacing the fluorine with a hydrogen atom would stop the formation of the methylthio metabolite. Indeed, acetaminophen (Tylenol ®), a non-fluorinated compound, also forms methylthio meiabolite.” Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 846-47. The trial court correctly concluded that nothing in the S & F article suggested “that a hydrogen atom in place of the fluorine atom . .. would be desirable . . . or that to make such a substitution would avoid the formation of the methylthio metabolite.” Id. Beyond the nonobvious selection step, the prior art also did not suggest any of the other modifications necessary to reach olanzapine. Thus, even if the S & F article taught what IVAX claims, the skilled artisan would still need to combine those teachings with compound 34 in Chakrabarti 1980a to reach olanzapine. As taught by Yamanouchi Pharm. Co. and other precedent, mere identification in the prior art of each 18a Appendix A component of a composition does not show that the combination as a whole lacks the necessary attributes for patentability, i.e. is obvious. Jn re Kahn, 441 F.3d 977, 986 (Fed.Cir.2006) (citing Jn re Rouffet, 149 F.3d 1350, 1355 (Fed.Cir.1998)). Rather, to establish a prima facie case of obviousness based on a combination of elements in the prior art, the law requires a motivation to select the references and to combine them in the particular claimed manner to reach the claimed invention. /d. In conclusion, because flumezapine caused EPS in two patients, elevations in CPK and a variety of liver enzymes in a number of patients, substantial evidence supports the trial court’s conclusion that the S & F article would not have led a person of ordinary skill in the art to believe that flumezapine could be successfully modified with a hydrogen atom. The district court correctly concluded that nothing in the S & F article and Chakrabarti 1980a made the combination reached in olanzapine obvious. Nonetheless, [VAX also cites to /n re Payne, 606 F.2d 303 (C.C.P.A 1979) to argue that Compound °222 and flumezapine “bracket,” and thereby make olanzapine prima facie obvious. To the contrary, Payne did not feature prior art that taught away from making the structural alterations as in this case. In this case, the prior art would have directed one of skill away from making flumezapine and ethyl- olanzapine (Compound °222). The “bracket” notion from Payne simply characterized the structural similarity in that case, which this court has noted does not control this case. Furthermore, Lilly overcame any prima facie case of obviousness. Among other things, Lilly proved extensive 19a Appendix A secondary considerations to rebut obviousness. The trial court found the evidence clearly established four of the five proffered secondary considerations. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 852-74, 905-12. Lilly established (1) a long-felt and unmet need; (2) failure of others; (3) industry acclaim; and (4) unexpected results. /d. The record shows a long-felt need for a safer, less toxic, and more effective clozapine-like drug; a decade (or more) of failure to find a replacement for clozapine; a reasonable amount of commercial success for olanzapine; and a number of awards for olanzapine as indicators of industry acclaim. Id. at 852-53. Specifically, the trial court noted a “long-felt but unsolved need for a safe atypical antipsychotic from 1975 until 1990,” as well as extensive evidence supporting the other objective criteria. /d. at 832-34, 906. The trial court also discussed the unexpected differences between the closest analog, Compound °222 and olanzapine, most of which focused on olanzapine not raising cholesterol levels in dogs, and a comparison of some humans tests with other similar drugs that raised CPK. /d. at 853-73. In sum, these objective criteria buttressed the trial court’s conclusion of nonobviousness. Il] The trial court concluded that Lilly’s clinical trials of olanzapine were not a public, but an experimental, use that negated any section 102 bar. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 913-14. Under section 102, a person is entitled to a patent, unless “the invention was... .in public use. . . in this country, more than one year prior to the date of the application for patent in the United 20a Appendix A States.” 35 U.S.C. § 102(b) (2000). Public use includes “any [public] use of [the claimed] invention by a person other than the inventor who is under no limitation, restriction or obligation of secrecy to the inventor.” /n re Smith, 714 F.2d 1127, 1134 (Fed.Cir.1983) (citing Egbert v. Lippmann, 104 U.S. 333, 336, 26 L.Ed. 755 (1881)). In considering whether a particular use was “public” within the meaning of section 102(b), this court considers the policies underlying the bar. Jone Bros., Inc. v. Sysco Corp., 28 F.3d 1192, 1198 (Fed.Cir.1994), cert. denied, 514 U.S. 1015, 115 S.Ct. 1356, 131 L.Ed.2d 214 (1995). In assessing this case, the trial court found that Lilly personnel conducted the HGAA, HGAB, and HGAC Phase I clinical trials of olanzapine in the Lilly clinic. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 912-13. In all three stages, Lilly restricted access to the facility and provided full-time security. Jd. Lilly closely monitored and confined the movements of the volunteers, who were healthy and not suffering from schizophrenia, for the duration of the study. Id. Visitors to the volunteers did not interrupt the control or confidentiality of the study. /d. Moreover, as the trial court noted, the clinical trials did not use the drugs to treat schizophrenic patients, but merely to test the safety and efficacy of the drug. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 913. Beyond this convincing record evidence, the experimental character of these tests negated any statutory bar. Even a use that occurs in the open may not invoke a bar when undertaken to experiment on or with the claimed invention. 7P Labs., Inc. v. Prof 'l Positioners, Inc., 724 F.2d 2la Appendix A 965, 971 (Fed.Cir. 1984), cert. denied, 469 U.S. 826, 105 S.Ct. 108, 83 L.Ed.2d 51 (1984). In the words of the Supreme Court, “[t]he use of an invention by the inventor himself, or of any other person under his direction, by way of experiment, and in order to bring the invention to perfection, has never been regarded as [a public] use.” City of Elizabeth v. Am. Nicholson Pavement Co., 97 U.S. 126, 134, 24 L.Ed. 1000 (1877). Several indicia may show the negating experimental character of a use, including (1) the length of the test period, (2) any confidentiality agreement, (3) any records of testing, (4) any monitoring and control of the test results, (5) the number of tests, and /6) the length of the test period in relation to tests of similar inventions. 7P Labs., 724 F.2d at 971-72; see also Inre Brigance, 792 F.2d 1103, 1108 (Fed.Cir.1986). In this case, Lilly tailored its tests to their experimental drug safety and efficacy purpose, adequately monitored for results, and maintained confidentiality throughout the duration of the study. The trial court did not err in finding no public use. IV DRL argues that the district court erred in not finding inequitable conduct because if it had looked at the totality of the circumstances, the evidence would have shown that Lilly intentionally made per se material statements that misled the examiner. “Inequitable conduct occurs when a patentee breaches his or her duty to the United States Patent and Trademark Office (PTO) of ‘candor, good faith, and honesty.’ ” Warner-Lambert Co. v. Teva Pharms. USA, Inc., 418 F.3d 1326, 1342 (Fed.Cir.2005) (quoting Molins PLC v. Textron) Inc., 48 F.3d 1172, 1178 (Fed.Cir.1995)). Inequitable conduct includes affirmative misrepresentations of material 22a Appendix A facts, non-disclosure of material information, or submission of false material information, coupled with an intent to deceive. See Nobelpharma AB v. Implant Innovations, Inc., 141 F.3d 1059, 1068-71 (Fed.Cir.1998) (citing Molins, 48 F.3d at 1178). To assess inequitable conduct, the trial court must determine whether the withheld reference meets a threshold level of materiality. Dayco Prods., Inc. v. Total Containment, Inc., 329 F.3d 1358, 1362-63 (Fed.Cir.2003) (quoting Purdue Pharma L.P. v. Boehringer Ingelheim GMBH, 237 F.3d 1359, 1366 (Fed.Cir.2001)). Then, the trial court must also determine whether the evidence shows a threshold level of intent to mislead the PTO. See Halliburton Co. v. Schlumberger Tech. Corp., 925 F.2d 1435, 1439 (Fed.Cir.1991). After finding the threshold levels of materiality and intent, the trial court then balances those factors. See Molins, 48 F.3d at 1178. Gross negligence alone is insufficient to justify an inference of intent to deceive the PTO. See Kingsdown Med. Consultants, Ltd. v. Hollister, Inc., 863 F.2d 867, 876 (Fed.Cir. 1988); FMC Corp. v. Manitowoc Co., 835 F.2d 1411, 1415 n. 9 (Fed.Cir.1987). In a case involving an omission of a material reference to the PTO, the record must contain clear and convincing evidence that the applicant made a deliberate decision to withhold a known material reference. See Molins, 48 F.3d at 1181. Beyond that, the applicant must have withheld the material subject matter with the intent to deceive. Ferring B.V. v. Barr Labs., Inc., 437 F.3d 1181, 1190 (Fed.Cir.2006). “Intent to deceive cannot be inferred simply from the decision to withhold the reference where the reasons given for the withholding are plausible.” Dayco Prods., 329 F.3d at 1368. 23a Appendix A Before the Swedish Board, Lilly noted idiosyncratic blood toxicity problems in isolated dogs at 10 mg/kg, and DRL claims Lilly’s failure to mention this to the PTO is inequitable conduct. However, the PTO had questions only about blood cholesterol levels. Before the Swedish Board, Lilly never commented about cholesterol levels. Indeed, Lilly’s statements to the Swedish Board about the idiosyncratic blood toxicity resulted from Lilly’s desire to conduct human clinical studies of olanzapine in Scandinavia. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 875-76. Before allowing human clinical studies, the Swedish Board required Lilly to respond to concerns about the toxic effects of olanzapine on blood cells and bone marrow in dogs during the D07290 Dog Study. /d. at 919-20. Lilly replied that these findings of hematoxicity “were believed not to have clinical relevance to humans since the effects occurred at large multiples of the clinical dose.” /d. at 875-76. These statements to the Swedish Board discounted the results of the blood studies by reference to idiosyncratic hematoxicity, not cholesterol problems. Thus, Lilly did not fail to disclose information or contradict its later patentability arguments. Furthermore, contrary to DRL’s argument, Dr. David Scruby’s declaration did not create a “false” impression that ihe D07290 Dog Study cholesterol findings could be extrapolated to humans. Dr. Scruby had been a staff physician at Lilly since 1983. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 882. This court acknowledges that Rohm & Haas, Co. v. Crystal Chem. Co., 722 F.2d 1556, 1571 (Fed.Cir.1983) states: “[T]here is no room to argue that submission of false affidavits is not material.” In this case, 24a Appendix A however, the record shows that Dr. Scruby’s affidavit was not false. Dr. Scruby’s affidavit could only be considered false if read to suggest that Dr. Scruby was telling the examiner to extrapolate point-by-point to humans olanzapine’s improved cholesterol levels in dogs as compared to Compound ’222. Dr. Scruby’s affidavit does not suggest such an extrapolation of the benefits of olanzapine from dogs to humans. Dr. Scruby, in fact, separates into different paragraphs his discussions of olanzapine’s benefits for cholesterol levels in humans and the effects of Compound °222 for dogs. Furthermore, he expressly relies on the declarations of Dr. Jeffrey Means and Dr. James Symanowski as “the basis for my clinical statements concerning the dog toxicology studies.” Dr. Means is a pharmacologist and toxicologist; and Dr. Symanowski is a statistician. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 837-38. Dr. Scruby’s affidavit appears in the prosecution history as a Response After Final (Response) for the following propositions: (1) that “cholesterol is recognized as a factor in coronary artery disease;” (2) that the Framingham Study “indicated that a 1% reduction in the cholesterol level results in a 2% reduction in coronary artery disease;” and (3) that “there is overwhelming evidence in the literature that serum cholesterol in excess of 240 mg/dL is a significant contributor to the genesis of atherosclerosis.” These statements are not false. The trial court did not err in discerning no clear and convincing evidence that Dr. Scruby misrepresented or withheld information from the PTO with an intent to deceive. Id. at 883-84. 25a Appendix A Lilly’s Response did not intentionally blur the distinctions between humans and dogs. Rather, Lilly’s Response expressly replied to the examiner’s request for human clinical comparisons of olanzapine and Compound 222 by stating: Applicants maintain that the Examiner’s request for human clinical comparison of olanzapine and compound ’222 is inappropriate .... In light of serious consequences associated with artificially altering the balance of cholesterol synthesis, Applicants assert that human clinical trials with '222 would be unethical and well as unreasonable. Response, at p. 11 (emphases added). Lilly made clear that it based none of its statements about the effects of either olanzapine or Compound °222 on human testing. Furthermore, the examiner also understood that the cholesterol data was based on the D07290 Dog Study because he asked ahout those results without any reference to cholesterol benefits for humans. Findings of Fact and Conclusions of Law, 364 F.Supp.2d at 882. In addition, on a separate inequitable conduct question, the trial court concluded that Lilly did not omit material subject matter from its Information Disclosure Statement in April 1991, which did not disclose the °574 patent and Chakrabarti 1980a. Id. at 917. The trial court also found no clear and convincing evidence that Lilly withheld Chakrabarti 1980a or the °574 patent with an intent to deceive the PTO. /d. at 917. The trial court noted that Lilly 26a Appendix A did disclose U.S. Patent No. 4,115,568 (°568 patent) to the PTO, and specifically explained that “[t]he reference fails to disclose the compound which is now claimed, but does describe the adjacent homologue [Compound ’222].” /d. at 894. It also noted that the technical disclosures of the °574 and °568 patents are identical and each discloses the genus of compounds that generically includes olanzapine. Moreover, Lilly cited the British counterpart of the °574 and °568 patents in the olanzapine patent application. In addition, the examiner found and relied on Chakrabarti 1980a during prosecution. As a result, the trial court did not err in its conclusion that nondisclosure of Chakrabarti 1980a or the °574 patent was neither a material omission nor done with an intent to deceive. Vv In conclusion, this court affirms the trial court on anticipation, obviousness, and public use questions. Because the parties do not dispute the facts, this court also affirms the trial court's legal conclusions on inequitable conduct finding no abuse of discretion therein. COSTS Each party shall bear its own costs. AFFIRMED. 27a APPENDIX B — FINDINGS OF FACT AND CONCLUSIONS OF LAW OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF INDIANA, INDIANAPOLIS DIVISION DATED APRIL 14, 2005 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION 1:01-cv-443-RLY-VSS ELI LILLY AND COMPANY and LILLY INDUSTRIES LTD., Plaintiffs, VS. ZENITH GOLDLINE PHARMACEUTICALS, INC., DR. REDDY’S LABORATORIES, LTD., and TEVA PHARMACEUTICALS USA, INC., Defendants. FINDINGS OF FACT AND CONCLUSIONS OF LAW [Table of Contents intentionally omitted] Plaintiffs, Eli Lilly and Company and Lilly Industries Ltd., filed suit against the Defendants, Zenith Goldline Pharmaceuticals, Inc., Dr. Reddy’s Laboratories, Ltd., and Teva Pharmaceuticals USA, Inc. (collectively “Defendants”), for infringement of United States Patent No. 5,229,382 (*“382 patent”). The parties tried this case before the court from 28a Appendix B January 26, 2004, through February 12, 2004. Following the trial, the parties filed proposed findings of fact and conclusions of law, and responses thereto. The parties also filed post-trial briefs, which the court found helpful given the breadth and complexity of the disputed issues. The majority of the relevant briefing was submitted by May 12, 2004, with final submissions filed in February 2005. Being duly advised, the court finds that Defendants have failed to prove by clear and convincing evidence that the °382 patent is invalid, as anticipated under 35 U.S.C. § 102, as obvious under 35 U.S.C. § 103, under the doctrine of double patenting, or as barred by prior public use under 35 U.S.C. § 102. The court further finds that Defendanis have failed to prove by clear and convincing evidence that the °382 patent is unenforceable due to inequitable conduct. The court now issues its findings of fact and conclusions of law pursuant to Federal Rule of Civil Procedure 52(a): FINDINGS OF FACT' I. The Parties 1. Eli Lilly and Company is an Indiana corporation engaged in the business of research, development, manufacture, 1. Citations to the trial transcript will be “[witness name] Tr.” followed by “[transcript page: line];” citations to the deposition testimony submitted by the parties will be “[witness name] Dep.” followed by “[dep. page: line]”; citations to the trial exhibits will be “TX” followed by the exhibit number; citations to the file history of referenced patents will be “FH” followed by the page number; and citations to Lilly’s demonstrative exhibits will be “LD” followed by the exhibit number. 29a Appendix B and sale of pharmaceutical products throughout the world. Lilly Industries Ltd., located in England, is a subsidiary of Eli Lilly and Company (the Plaintiffs are hereinafter collectively and individually “Lilly”). Zenith Goldline Pharmaceuticals, Inc. (“Zenith”) is a Florida corporation having its corporate offices and principal place of business at 4400 Biscayne Boulevard, Miami, Florida 33137. Zenith’s Amended Answer to Complaint for Patent Infringement, Affirmative Defenses and Counterclaims, filed August 7, 2002, P 3. Dr. Reddy’s Laboratories, Ltd. (“DRL”) is a public limited liability corporation having its principal place of business at 7-1-27 Ameerpet, Hyderabad 500 016, India. DRL’s Amended Answer and Counterclaim, filed July 29, 2002, P 3. Teva Pharmaceuticals USA, Inc. (“Teva”) is a Delaware corporation with its principal place of business at 650 Cathill Road, Sellersville, Pennsylvania. Answer of Defendant Teva Pharmaceuticals USA, Inc., filed on March 18, 2003, P 3. On July 20, 1993, the United States Patent and Trademark Office (“PTO”) issued the 382 patent which is entitled *2-Methyl-Thieno-Benzodiazepine.” The °382 patent was assigned to, and is owned by, Lilly. TX 1000; TX 1360. 10. 11. 30a Appendix B The °382 patent claims, inter alia, the chemical compound known as olanzapine and methods of using olanzapine to treat schizophrenia. TX 1000, col. 12, claims 1, 2, 3, 7, 8, and 15. Olanzapine, sold by Lilly under the trademark ZYPREXA(R) (“Zyprexa”), was approved by the United States Food and Drug Administration (“FDA”) in late 1996. Paul Tr. 139:16-19. Zenith, DRL, and Teva filed Abbreviated New Drug Applications (“ANDAs”) under the Drug Price Competition and Patent Term Restoration Act of 1984, 98 Stat. 1585 (popularly known as the Hatch-Waxman Act), seeking approval to market generic copies of Lilly’s olanzapine products prior to the expiration of the °382 patent. Pursuant to 21 U.S.C. § 355(j)(2)(B)(ii), Zenith, DRL, and Teva sent letters to Lilly to notify it that they had filed ANDAs for olanzapine in various dosages. Lilly filed suit against Zenith, DRL, and Teva alleging infringement of the °382 patent under 35 U.S.C. § 271(e)(2)(A). The court consolidated Lilly’s suits against Zenith, DRL, and Teva into this single action. See e.g., Entries of February 15, 2002: April 11, 2002; November 1, 2002; and March 14, 2003. Lilly seeks an order (1) prohibiting FDA approval of the Defendants’ generic olanzapine products prior to the expiration of the °382 patent, in accordance with 3la Appendix B 35 U.S.C. § 271(e)(4)(A); and (2) enjoining the Defendants from the commercial manufacture, use, offer to sell, sale, or importation of their olanzapine products, in accordance with 35 U.S.C. § 271(e)(4)(B). Complaint, filed April 2, 2001, Prayer for Relief. 13. After the commencement of the suit, Zenith and DRL 14. stipulated that “if the Court finds the *382 patent valid and enforceable, then their actions constitute infringement.” Entry, December 2, 2003 at 2. The parties further stipulated that the only method-of-use claims to be tried in this case are claims 7 and 8 of the °382 patent relating to the treatment of schizophrenia. Stipulation and Order entered on ‘uly 31, 2003 at p. 3. Therefore, the issues before the court are the validity and enforceability of claims 1, 2, 3, 7, 8, and 15 of the °382 patent. Teva did not participate in the trial but agreed to be bound by the decision of the court herein. Entry on Joint Stipulation and Staying Actions. July 16, 2003. II. Background in the Relevant Field Prior to the 15. Prosecution of the ’382 Patent A. Schizophrenia Schizophrenia is a chronic, debilitating mental illness that appeers during late adolescence or early adulthood and essentially lasts the lifetime of the patient. Paul Tr. 109:17-119:1. 16. 17. 18. 32a Appendix B Some of the symptoms of schizophrenia include, but are not limited to, “positive” symptoms and “negative” symptoms. “Positive” symptoms include hallucinations, delusions, and thought disorders. See, e.g., video clip at TX 1446.1. “Negative symptoms” include loss of emotional and mental functioning, loss of motivation, loss of normal emotional response to other people, slowness of thinking, memory deficits, changes in speech (speaking in a dull monotone), and difficulties with cognition, sustained attention, decision-making, and mental flexibility. Paul Tr. 108:2-25, 109:1-16; Schulz Tr. 2972:1-5. B. Early Drug Treatment — Typical Antipsychotic Drugs Prior to the discovery of antipsychotic medications in the 1950s, most schizophrenic patients were isolated from society and kept in large asylums. Paul Tr. 110:10- 19. This pattern of lifetime institutionalization for schizophrenic patients began to change in 1952 with the introduction of chloropromazine and continued through the later introduction of haloperidol in the 1960s. TX 1398 at 746; Paul Tr. 111:2-9. These early antipsychotic medications (known as “typical” antipsychotics) showed substantial reduction of positive symptoms and allowed a number of patients to leave institutional settings. TX 1398 at 746; Paul Tr. 111:12- 112: 4. However, the typical antipsychotic medications did little to treat the symptoms of schizophrenia and also 19. 20. 33a Appendix B induced a number of “sometimes severe and intolerable neurological side effects.” TX 1398 at 746; Paul Tr. 112:8-13. Such side effects associated with so-called extrapyramidal symptoms or “EPS” led to gross movement disorders, such as disfiguring tremors, stiffness, tics, and writhing. A particularly severe form of EPS, called “tardive dyskinesia,” persisted even after medications were withdrawn. Paul Tr. 113:22-114:1. In addition, patients experienced elevation of the hormone prolactin that led to breast engorgement and. milk production in both male and female patients. Paul Tr. 112:5-115:12. C. Clozapine: The First Atypical Antipsychotic In the late 1960s and early 1970s, it became apparent that a drug called “clozapine” could treat the psychotic symptoms without EPS or prolactin elevation, causing it to be recognized as the first “atypical” antipsychotic: Paul Tr. 116:6-117:2; Nichols Tr. 2743:9-13. In 1975, clozapine was withdrawn from the market in many countries because it was found to cause an often fatal blood disorder called “agranulocytosis” in approximately one percent of patients. This effect, and resulting withdrawal of the drug from the market, prompted people in the pharmaceutical industry to start looking for a drug like clozapine, but without the same side effect profile. Nichols Tr. 2743:14-2744:9; Paul Tr. 131:8-11; Schulz Tr. 3004:15-20. 21. 34a Appendix B D. The Search for a Safe, Atypical Antipsychotic Drug The general failure for many years to find a clozapine replacement was reflected in the scientific literature. TX 1356, Nichols Tr. 2750:17-2752:2. The literature contains many reports of promising compounds which failed either for lack of efficacy or because of toxic side effects. TX 1356; TX 1383; TX 1593; TX 1594; TX 1595; Nichols Tr. 2751:5-2769:24; see also Tupper Tr. 242:22-243:10, 246:9-247:8; TX 1595 (summarizing various scientific publications that reported the efforts of major pharmaceutical companies to find safe and effective antipsychotic medications). In late 1989, the FDA approved clozapine for limited use in the United States notwithstanding its adverse side effects, as a therapy of last resort to be used only with careful blood monitoring. Paul Tr. 117:25-118:13. In 1991, the New England Journal of Medicine reported that, “despite the extensive developmental effort in this area, no alternative to clozapine has been identified that has clinical antipsychotic efficacy and no extrapyramidal neurologic side effects, but has a low risk of inducing other important toxic effects (bone marrow suppression or seizures).” TX 1398 at 747. Clozapine and certain other “typical” antipsychotics on the market such as chlorpromazine and haloperidol, had a “neuroleptic substituent,” an electron withdrawing group believed to be important for antipsychotic activity. The most common neuroleptic substituent has 25. 26. 27. 35a Appendix B a halogen atom: The term “halogen” refers to either a fluorine or a chlorine atom. Tupper Tr. 414:9-418:18, 487:13-488:1. E. Lilly’s Attempts to Discover a Safe, Atypical Antipsychotic Drug In the late 1970s and early 1980s, Lilly produced a novel class of compounds called thienobenzodiazepines. Tupper Tr. 428:23-429:25. Thienobenzodiazepines are tricyclic compounds having “thieno,” “benzo,” and “diazepine” rings fused together. In 1975, Lilly filed a patent application related to these compounds. In 1978, the PTO issued two patents, U.S. Patent No. 4,115,568 (“the 568 patent”), TX 1408, and U.S. Patent No. 4,115,574 (“the 574 patent”), TX 3129, having identical technical disclosures, but different claims. Tupper Tr. 429:16-20, 431:4-19. Dr. Jiban Chakrabarti (“Dr. Chakrabarti”) and Dr. David Tupper (“Dr. Tupper”) are listed as the named inventors on the 568 patent and the 574 patent. TX 1408; TX 3129. The 568 and 574 patents described the members of this class of new compounds as “useful in the treatment of . .. certain kinds of psychotic conditions. . .” TX 3129, col. 13,11. 62-66; TX 1408, col. 14, 11. 41-42. The 574 patent identifies the characteristics of the most preferred class of compounds within this family. TX 3129, col. 4,11. 27-29. From this most preferred class, the patent identifies one particularly active compound 29. 30. . o 36a Appendix B as 2-ethyl-7-fluoro-10-(4'-methyl-1'-piperazinyl)-4H- thieno[2,3-b][1,5]benzodiazepine, known throughout this trial as “ethyl flumezapine.” Tupper Tr. 431:20- 432:8. Lilly, like many others in the field, modeled its lead candidates after clozapine, having a halogen atom in the molecule. Nichols Tr. 2751:5-2757:14; TX 1356 at 806; Tupper Tr. 413:21-414:9, 503:20-21; Pullar Tr. 200:20-201:3. Clozapine has a chlorine atom (Cl) at a position analogous to the fluorine atom (F) in ethyl flumezapine. Other than the broad genus claimed in claim 1, Lilly’s 574 patent claimed only compounds with a halogen. TX 3129, col. 39, claims 2-7; Tupper Tr. 433:5-14; Nichols Tr. 2749:5-9. Beginning in the fall of 1974, Lilly made a compound like ethyl flumezapine, but without the fluorine atom, which corresponds to ethyl olanzapine, a compound otherwise known as “compound 222”. Tupper Tr. 426:23-427:10; TX 1205. From the very earliest tests of the ethy] flumezapine and compound 222 molecules, it was apparent that the fluorine-containing molecule (ethyl flumezapine) was much more active in tests believed to be relevant to potential antipsychotic activity than the molecule without the fluorine (compound 222). Tupper Tr. 428:9- 15. 33. 34. 33. 37a Appendix B After a year and a half of preclinical development work aimed at taking ethyl flumezapine into human clinical trials, disaster struck. In a six-month toxicology study with dogs, conducted at 4, 8, and 12 mg/kg using three dogs of each sex at each dose level, blood disorders, reminiscent of the potentially fatal blood disorder seen with clozapine in humans, were seen in dogs at all dose levels. TX 1035; TX 3421; Pullar Tr. 175:14-176:23. In particular, the toxicology tests in dogs showed widespread neutropenias in all dose groups and one anemia. Neutropenia is a reduction of white blood cells. Some of the dogs had reductions as much as 75% of their normal value. TX 3421; Emmerson Tr. 542:6-21. In an effort to find a compound in the class free of this problem, Lilly conducted a comparative toxicology test between ethyl flumezapine and a closely related compound called “flumezapine.” TX 1003; Pullar Tr. 177:23-178:14. The difference between ethyl flurnezapine and flumezapine is that in the two position on the thiophene ring where ethyl flumezapine has an ethyl group (-CH[2]-CH[3]), flumezapine has a methyl group (-CH[3]). Pullar Tr. 178:1-7. During the comparative dog study, two of the ethyl flumezapine-treated dogs, but none of the flumezapine- treated dogs, developed blood problems. Pullar Tr. 180:11-19; TX 1003, 1004. As a result, Lilly terminated the development of ethyl flumezapine and commenced the development of flumezapine in early 1978 under the guidance of Dr. Jan Pullar (“Dr. Pullar”). Pullar Tr. 180:23-181:1; Hotten Dep. 71:12-72:10. 36. 37. 38. 38a Appendix B Lilly spent the next four years developing flumezapine through preclinical testing and initial safety testing in normal human volunteers. Pullar Tr. 185:20-188:12; TX 1008; TX 1010. Among other tests, Lilly conducted a six-month dog study of flumezapine, Emmerson Tr. 544:23-545:24; TX 1005, and a safety trial in normal human volunteers. TX 1010 at ZYP 177 1715-19. Then, in the spring of 1982, during the first trial of flumezapine in actual schizophrenic patients, administered at and below therapeutic doses, several patients experienced elevations in the muscle enzyme creatinine phosphokinase (or “CPK’”) and in a variety of liver enzymes. Pullar Tr. 188:13-189:14, 195:15- 198:16; TX 1015 at ZYP 177 1998-99; Hotten Dep. 70:14-71:11. The findings were reported by telephone to the FDA. TX 3259. That afternoon, Dr. Paul Leber in the Division of Neuropharmacology Drug Products at the FDA, halted U.S. clinical testing when he “advised that patients be withdrawn from the drug as soon as possible.” TX 3260. Similarly, the British regulatory authority “expressed surprise at the magnitude of the increases in liver enzymes and especially the levels of CPK,” noting that they “had not experienced anything similar.” TX 1615. After Lilly informed the agency of these results, the agency withdrew the United Kingdom (“U.K.”) authorization for clinical testing, and Lilly terminated the flumezapine clinical trials. Pullar Tr. 190:20-194:11: TX 1042. a9: 40. 41. 39a Appendix B Neither the failure of the flumezapine clinical trials nor the reasons for it (muscle or liver enzyme elevations) were publicly reported. Reith Tr. 927:9-11; Nichols Tr. 2776:18-2777:3; TX 1356 at 809. F. The Discovery of Olanzapine After the failure of flumezapine in clinical trials, a team led by Dr. Tupper at Lilly created another group of compounds in the same series in an effort to find another compound that could be developed as a clozapine replacement and that would not meet the same fate in the clinic as flumezapine. Tupper Tr. 441:23-443:2, 446:2-447:17; TX 1229-40. The cause of flumezapine’s toxicity was unknown. Tupper Tr. 443:3-20. Speculation abounded inside Lilly regarding possible causes, including reactions involving the “piperazine nitrogen” and the fluorine atom. The distal piperazine nitrogen is demethylated and the nitrogen and adjacent carbon oxidised as with other N-methylpiperazinyl compounds. If this is the source of the toxicity it is unlikely that it can be reduced without losing the neuroleptic activity. The 7-fluorine is replaced by hydroxy and methylthio groups... . whether the source of this toxicity is the reduction in glutathione levels, a metabolic intermediate or the methylthio metabolite itself is at present, unknown. The hydroxylation metabolic pathway could also be implicated. TX 3657 at ZY 80 94. 43. 44, 45. 40a Appendix B Compounds with ethyl groups (like ethyl flumezapine and ethyl olanzapine (compound 222)) were not considered for further development because the ethyl group was believed by some at Lilly to produce agranulocytosis in dogs. TX 3657 at ZY 80 94; Tupper Tr. 443:6-444:20; Hotten Dep. 79:6-80:8, 81:11-19. Several fluorinated and unfluorinated alternatives were made and tested, including the compound known as olanzapine (then known simply as “LY 170053”). Hotten Dep. 42:5-16, 43:20-44:8, 45:1-17. Olanzapine was first synthesized in the U.K. by Terrence Hotten (“Mr. Hotten’’), a research chemist at Lilly, on April 29, 1982. Tupper Tr. 446:2-14; TX 1229. Olanzapine differs from flumezapine by having a hydrogen atom (conventionally not shown on structural diagrams) where flumezapine has a fluorine atom. Pullar Tr. 199:16-24; Hotten Dep. at 42:21-43:6. A number of people doubted that olanzapine would work because it lacked the halogen atom then known to be important to the activity of clozapine and believed to be important for activity in this series of compounds as well. Pullar Tr. 200:20-201:3; Tupper Tr. 451:7-20. Indeed, olanzapine was believed, based on a variety of preclinical tests, to be only about half as potent as flumezapine. Pullar Tr. 201:10-18; Tye Dep. 71:21- 72:21, 75:21-76:12; TX 3657 at ZY 80 100-101,103 (comparing two compounds). In 1983, Lilly began by testing olanzapine in dogs — first in a three-month study and later in a one-year study. 46. 47. 4la Appendix B Emmerson Tr. 546:23-547-6, 552:14-17. During each of the studies, one dog developed a blood problem. Emmerson Tr. 546:19-24, 552:18-553:7. After extensive testing, Lilly determined that the effect in dogs appeared to be an immune response and “idiosyncratic” in nature, meaning it occurred due to the unusual sensitivity in individual dogs. Emmerson Tr. 549:22-550:23, 554:18-555:15. Only then did Lilly determine that it might cautiously proceed with human trials of olanzapine. Emmerson Tr. 550:14-551:8, 555:6-15. In 1986 and 1987, Lilly conducted Phase | clinical trials of olanzapine in healthy human volunteers in Indianapolis, Indiana. Goldberg Tr. 307:9-21; TX 3741; TX 3742; TX 3744. At the conclusion of these trials, Lilly proceeded to the litmus test of olanzapine — a clinical trial to test the compound’s efficacy in actual schizophrenic patients. Goldberg Tr. 326:25-327:20. These clinical trials took place in the U.K. TX 1058; TX 1064. Toward the end of 1989, the clinical trials were promising. In the first test of the drug in actual schizophrenic patients, olanzapine appeared to be a safe and effective, atypical antipsychotic drug having a more favorable side effect profile than typical antipsychotics in terms of EPS and not producing the blood disorders in patients. Goldberg Tr. 335:19-20, 344:14-22, 345:6- 9; TX 1063; TX 1064 at ZYP 520 983-84. 48. 49. 50. 4 42a Appendix B On January 18, 1990, the olanzapine project team reported the success of the clinical trial to Lilly’s Research Management Staff (“RMS”), and the RMS agreed to “product commitment.” TX 1063 at ZYP 449 1132. After the project team report, the project was referred to with words like “AAA priority” and the “Manhattan Project” (in reference to the scientific push to develop the atom bomb), TX 3532, and Lilly scientists made plans for expanded clinical trials on the compound. Goldberg Tr. 338:21-340:7; TX 1063 at ZY 449 1128. In the fall of 1990, Lilly conducted another comparative dog toxicology study prior to filing a patent application with the PTO. The study was designated D07290, and is known throughout this litigation as the “D07290 Dog Study” or “D07290 Study.” The purpose of the D07290 Study was to determine over the course of a chronic treatment period whether there was a difference in the toxicity profile between olanzapine and compound 222. Symanowski Tr. 664:4- 665:13, 668:24-669:4, 2077:9-18; TX 3439 at ZYP 187 713, Item 4. At the conclusion of the D07290 Study, Lilly claimed that the results of the study showed that olanzapine was unexpectedly superior to compound °222 in that olanzapine did not cause a significant elevation in average mean cholesterol versus compound °222. TX 1001.1 at FH 17-18. 52. Il 53. 54. a0. 56. 43a Appendix B The D07290 Dog Study is at the heart of this case and is discussed at length in this opinion. . Prosecution History of the ’382 Patent A. The 143 Patent Application On April 23, 1991, Lilly filed U.S. Application Serial No. 690,143 (“the 143 application”). TX 1000, col. 1, 11. 4-5. Lilly had previously filed a patent application in the U.K. on April 25,1990, and perfected the priority date. Pursuant to 35 U.S.C. § 119, Lilly is entitled to the April 25, 1990 date for purposes of determining the relevant scope and content of the prior art. Killworth Tr. 769:15-770:16, TX 1000. As part of the 143 patent application, Lilly was required to fill out an Information Disclosure Statement (“IDS”’) to inform the Patent Examiner (“Examiner”) of the most closely related prior art. In Lilly’s IDS, Charles Ashbrook (“Mr. Ashbrook”), Assistant General Patent Counsel at Lilly, represented that the most closely related prior art was the matter claimed in the 568 patent. TX 1001.1 at FH 44-45. Though the patent applicants did not cite the Examiner to either the 574 patent or Chakrabarti et al., 4-Piperazinyl- 10H-thieno[{2,3-b][1,5]benzodiazepines as Potential Neuroleptics, J. MED. CHEM. 23:878-84 (1980) (“Chakrabarti 1980a’’), the Examiner performed a search of the prior art, found those references, and cited them in the Office Action. TX 1001.1 at FH 48-53. oY. 58. 59. 44a Appendix B In the 1991 IDS, Lilly told the Examiner that compound 222, described in the 568 patent, is the adjacent homolog to olanzapine, but that olanzapine is patentable over the disclosure in the 568 patent because of the “surprising biological differences of the 2-methy] derivative (olanzapine) over the 2-ethyl derivative (compound 222).” TX 1001.1 at FH 44. Also in the 1991 IDS, the patent applicants told the Examiner that flumezapine, which is the 7-fluoro derivative of olanzapine, “caused significant adverse effects. when administered to humans” and that olanzapine “has an unexpectedly superior therapeutic profile.” TX 1001.1 at 45. In the 143 application, the applicants represented that: “In dog toxicity studies with a closely analogous compound 2-ethyl-10-(4-methy!-1-piperazinyl)-4H- thieno[2,3-b][1,5] benzodiazepine [compound 222], at a dosage of 8 mg/kg, it was observed that four out of eight dogs showed a significant rise in cholesterol levels, whereas the compound of the invention did not show any rise in cholesterol levels.” TX 1001.1 at FH 17-18. This text corresponds to col. 3, 11. 29-36 of the °382 patent, TX 1000, co!. 3,11. 29-36, and is a reference to the D07290 Dog Study. Plaintiffs’ Reply to Amended Answer to Complaint for Patent Infringement, Affirmative Defenses, And Counterclaims of Zenith Goldline Pharmaceuticals, Inc. (filed September 20, 2002) (“Lilly’s Reply”), P 19. 60. 61. 62. 63. 45a Appendix B In the 143 application, Lilly stated that seventeen patients received flumezapine before the clinical trial was terminated after consultation with the FDA because of an unacceptably high incidence of raised enzyme levels in the treated patients. Specifically, “creatinine phosphokinase (CPK) and the liver enzymes, serum glutamate oxalacetic transmaninase (SGOT) and serum glutamate pyruvate transaminase (SGPT), estimated in the blood samples from the patients, were substantially in excess of normal values, indicating the possibility of toxicity.” TX 1001.1 at FH 15. With respect to olanzapine, Lilly stated only that “there is a low incidence of only mild and transient elevation of liver enzymes in patients treated with therapeutic doses, and plasme levels of ... CPK are lower than with flumezapine, indicating a lower adverse effect on muscular tissue.” TX 1001.1 at FH 17. The Examiner reviewed the claims for compliance with the enablement requirement of 35 U.S.C. § 112, the definiteness requirements of 35 U.S.C. § 112, for novelty under 35 U.S.C. § 102, for nonobviousness under 35 U.S.C. § 103, and for obviousness-type double patenting. TX 1001.1 at FH 49-51, 53; Killworth Tr. 778:10-24, 779:5-21, 781:13-19. On November 25, 1991, the Examiner issued an Office Action with respect to the °143 application rejecting all of the claims. TX 1001.1 at FH 48-53. In evaluating novelty, the Examiner rejected Lilly’s claims under 35 U.S.C. § 102(b) as being “anticipated” 64. 46a Appendix B by the 574 patent, citing a portion of the text of the 574 patent that was shared by the 568 patent cited by Mr. Ashbrook in his IDS. Killworth 778:20-779:3; TX 1001.1 at FH 50. The Examiner rejected all of the claims under 35 U.S.C. § 103 as obvious over the 574 patent in view of Chakrabarti 1980a. TX 1001.1 at FH 51-53. The Examiner stated that “it would have been obvious to one with ordinary skill in the art toreplace the 2-ethyl substituent on the homologous species [compound 222] taught in [the 574 patent] with the 2-methy] substituent in order to obtain the instant compound [olanzapine] because [Chakrabarti 1980a] specifically suggests to one with ordinary skill in the art that this type of substituent is preferably [sic] to increase [central nervous system] activity.” TX 1001.1 at FH 51-52. 65. The Examiner considered the description of the unexpected 66. cholesterol results in the application to be “insufficient” because “1) no controls were run, 2) there is no evidence that such data is statistically significant and 3) that such data is necessarily showing a significant beneficial effect to the patient.” TX 1001.1 at FH 52; Killworth Tr. 780:10- 17. Finally, the Examiner rejected Lilly’s claims under the judicially created doctrine of “obviousness-type double patenting” as being unpatentable over the claims of the 574 patent in view of Chakrabarti 1980a for the same reasons that the claims were alleged to be obvious from the vext of the 574 patent in view of Chakrabarti 1980a under 35 U.S.C. § 103. TX 1001.1 at FH 53; Killworth Tr. 781:13-782:12. 67. 68. 69. 70. 71. 47a Appendix B B. The 348 Continuation Application Lilly responded to the Office Action on May 22, 1992, by filing a file wrapper continuation application to extend the time period for response to the rejection. TX 1001.1 at FH 98-100; Killworth Tr. 782:16-783:13. This application was assigned the application serial number 890,348 (the “348 application”). TX 1001.1 at FH 98. The 348 application contained the same disclosure, including the claims, as the 143 application. In accordance with standard PTO procedure, the 348 application was assigned to the same Examiner who had examined the 143 application. Killworth Tr. 782:16-783:25; TX 1001.1 at FH 98-100. On September 11, 1992, the Examiner issued another Office Action rejecting the claims for the same reasons set forth in the prior Office Action in the 143 application. Killworth Tr. 784:1-22; TX 1001.1 at FH 102. On December 10, 1992, three representatives of Lilly conducted a personal interview with the Examiner in the 348 application. The Lilly representatives were Macharri Vorndran-Jones (““Ms. Vorndran-Jones”) and Joseph Jones (“Mr. Jones”) from Lilly’s legal department, and Dr. James Emmerson (“Dr. Emmerson”), a Lilly toxicologist. TX 1001.1 at FH 109-10. At the interview, Lilly presented eight declarations of Lilly employees to the Examiner extensively describing the results of comparative tests of olanzapine and 73. 74. 48a Appendix B compound 222, including the D07290 Dog Study. TX 1001.1 at FH 125-54. These declarations were submitted by Dr. Nicholas Tye (“Dr. Tye”), Dr. Pullar, Dr. Nicholas Moore (“Dr. Moore”), Dr. Jeffrey Means (“Dr. Means”), Dr. Emmerson, Dr. David Wong (“Dr. Wong”), Dr. David Scruby (“Dr. Scruby”), and Dr. James Symanowski (“Dr. Symanowski’). TX 1001.1 at FH 125-27 (Tye), FH 128-30 (Pullar), FH 131-34 (Moore), FH 135-39 (Means), FH 140-42 (Emmerson), FH 143-45 (Wong), FH 146-48 (Scruby), FH 149-54 (Symanowski). Dr. Tye, Dr. Pullar, and Dr. Moore are pharmacologists; Dr. Means is a pharmacologist and toxicologist; Dr. Emmerson, as stated earlier, is a toxicologist; Dr. Wong is a biochemist; Dr. Scruby is a Lilly physician; and Dr. Symanowski is a statistician. All declarations were submitted under 37 C.F.R. § 1.132 and all declarants swore that the statements made therein were true. TX 1001.1 at FH 125-54. Dr. Moore’s declaration analyzed the results of behavioral tests in which animals were administered olanzapine or compound 222. TX 1001.1 at FH 131- 34. Dr. Moore concluded that in the conditioned avoidance response (“CAR”) test, olanzapine was more active. TX 1001.1 at 132. He also concluded that out of the four tests he conducted — the apomorphine- induced climbing and hypothermia tests in mice, the CAR test in rats, the catalepsy-induction in rats, and the locomotor activity in rats — “both compounds have 49a Appendix B very similar dopamine antagonist activity in vivo.*” TX 1001.1 at 134. 75. Dr. Pullar presented the results of in vitro testing of olanzapine and compound 222 using binding assay tests. The results were presented in two tables showing the respective IC[{50] values for each compound in each of the tests. No argument was made that the compounds could be differentiated based on the results of these tests. TX 1001.1 at FH 128-30. 76. Dr. Tye’s declaration discussed his examination of the data set out by Dr. Moore and Dr. Pullar and his views on the D07290 Dog Study carried out by Dr. Means and the results thereof. TX 1001.1 at FH 124-27. Dr. Tye concluded that: (1) the data of Dr. Moore and Dr. Pullar suggested “little difference in the properties of [olanzapine and compound 222]”; (2) the data from the dog toxicology study “showed significantly increased levels of cholesterol in the case of [compound 222],” (3) raised cholesterol levels resulting from compound 222 are a serious disadvantage because cholesterol is a factor in coronary heart disease in humans, and (4) olanzapine “is clearly and significantly superior to [compound 222] so far as it has been shown in the toxicity study by Dr. Means to lack any tendency to raise cholesterol levels.” TX 1001.1 at FH 126. 2. As used in this case, the term “in vivo” refers to the results observed in animals, and the term “in vitro” refers to the results observed in a laboratory. ii 78. 79. 50a Appendix B Dr. Wong’s declaration evaluated data obtained from radioligand and binding studies of olanzapine and compound 222. TX 1001.1 at FH 143-45. In part, Dr. Wong concluded that “both olanzapine and [compound] 222 can produce functional responses at 5-HT[1C] and 5-HT[2] receptors.” TX 1001.1 at FH 145. Dr. Emmerson oversaw the Lilly D07290 Dog Study. He stated in his declaration that he believed that “olanzapine displayed an unexpected and significant superior toxicological benefit over compound 222” with respect to the elevation of serum cholesterol in female dogs dosed with 8 mg/kg of compound 222 compared with dogs similarly dosed with olanzapine and the control dogs. TX 1001.1 at FH 142. Dr. Emmerson believed that this toxicological benefit was a critical property to consider in the safety analysis of the two compounds and that he “would not recommend the clinical development of a compound which significantly increases the serum cholesterol levels in dogs when there is a compound with similar activity which does not affect serum cholesterol levels.” TX 1001.1 at FH 142. Dr. Means was the study director for Lilly’s D07290 Dog Study. His declaration summarized the design, conduct, and findings of the study. TX 1001.1 at FH 134-39. a. Dr. Means stated that “suprisingly serum cholesterol levels in females of the 8 mg/ kg-°222 treatment group were significantly Sla Appendix B increased when compared to the cholesterol levels of females in either the 8 mg/kg- olanzapine treatment group or the control group.” TX 1001.1 at FH 137. b. Dr. Means also stated that “no significant differences in serum cholesterol levels were detected among the olanzapine treatment and control groups.” TX 1001.1 at FH 137. c. Dr. Means concluded that “the toxicity of olanzapine and compound 222 in beagle dogs is similar in many respects,” but that “an unexpected difference between olanzapine and compound 222 was the significant increase of serum cholesterol coicentrations with time in female dogs given 8 mg/kg/day of compound 222 compared to the cholesterol values in female dogs given 8 mg/kg/day [of] olanzapine and compared to the cholesterol values in female control dogs.” TX 1001.1 at FH 139. 80. Dr. Scruby stated that he reviewed Dr. Means’ and Dr. Symanowski’s declarations, and that those declarations provided the basis for Dr. Scruby’s clinical statements concerning the gog toxicology studies. TX 1001.1 at FH 146-48. a. In his declaration, Dr. Scruby discussed his knowledge of the risk associated with elevated total cholesterol in humans and 81. 52a Appendix B stated that “any factor which leads to an increase in serum lipids [] can have a significant deleterious effect on [cornary artery disease and the progression of atherosclerosis].” TX 1001.1 at FH 147-48. Dr. Scruby concluded that based on the findings of the study in which the serum cholesterol female dogs treated with compound 222 after 60 days averaged nearly 260mg/dl and “in view of the overwhelming evidence in the literature that serum cholesterol in excess of 240 mg/dl is a significant contributor to the genesis of atherosclerosis,” he believed that “the significant elevation of serum cholesterol observed in female dogs treated with the 222 compound could provide a marked clinical difference in the pathogenesis of coronary artery disease.” TX 1001.1 at FH 148. Dr. Symanowski’s declaration summarized the statistical tests used in the D07290 Study. TX 1001.1 at FH 149-54. He reported that cholesterol levels in 8 mg/kg compound 222 female dogs were noticeably elevated after day 25 of treatment and that statistical analysis indicated that these levels increased significantly over time when compared to both the 8 mg/kg olanzapine female dogs and the control group, whereas none of the olanzapine-treated groups were statistically significantly different from control. \ 82. 83. 84. 53a Appendix B TX 1001.1 at FH 150-51. He presented three graphs illustrating mean cholesterol levels over time. Figure | presented the group mean cholesterol values throughout the study for all of the groups of female dogs. TX 1001.1 at FH 152. Figure 2 presented the same information for the groups of male dogs. TX 1001.1 at FH 153. The data presented by Dr. Symanowski showed no significant difference between olanzapine and compound 222 with respect to cholesterol in male or low-dose female dogs. Figure 3 illustrated the mean values plus and minus one standard error for the cholesterol levels in female dogs dosed with 8 mg/kg of compound 222 and olanzapine, as well as the female control group. TX 1001.1 at FH 154. Following the interview, the Examiner prepared a short, handwritten summary of the interview indicating that the Lilly representatives and the Examiner discussed the declarations. TX 1001.1 at FH 109. The Examiner reported in his summary that while “the reviewed data looked sufficient pending final review and analysis of the complete set of data,” an agreement was not reached as to patentability. TX 1001.1 at FH 109. Following the interview, the patent applicants presented to the PTO a document entitled “Response After Final.” TX 1001.1 at FH 112-24. In the Response After Final, the patent applicants argued that “olanzapine exhibits the significant beneficial property of preserving the natural balance of cholesterol 85. 86. 87. 88. 54a Appendix B synthesis in the treatment of schizophrenia and schizophreniform disorders.” TX 1001.1 at FH 119-20. In the Response After Final, the patent applicants also argued that Lilly’s “probative evidence of olanzapine’s superiority in one or more properties is sufficient to overcome the prima facie obviousness rejection.” TX 1001.1 at FH 120. To overcome a prima facie obviousness rejection, a patent applicant can respond to the rejection or the applicant can attempt to overcome the rejection by filing declaratory evidence. Sofocleous Tr. 959:15-960:6; Killworth Tr. 789:4-16. While Lilly did not acquiesce to the Examiner’s determination that the claims were prima facie obvious, it did not advance specific argument to challenge this finding. TX 1001.1 at FH 117, 124 (indicating Lilly’s intent not to admit prima facie obviousness); Vorndran- Jones Tr. 1611:3-7; Killworth Tr. 789:4-790:2; Sofocleous Tr. 789:15-22. In the Response After Final, Lilly made several significant statements. a. “Dr. Means’ Declaration demonstrates that the blood cholesterol levels of female dogs treated with the °222 derivative were significantly elevated when compared to the blood cholesterol levels of dogs treated with the 2-methyl (olanzapine) compound.” TX 1001.1 at FH 120-21. 89. 90. 55a Appendix B b. “No significant increase in cholesterol levels was observed in either the olanzapine treated dogs or the control dogs.” TX 1001.1 at FH 120. c. “Valid controls were included in the study as substantiated by Dr. Means’, Dr. Emmerson’s, and Dr. Symanowski’s Declarations.” TX 1001.1 at FH 121. d. “Statistically significant elevated blood cholesterol levels occurred in the °222 treated dogs, as demonstrated by Dr. Symanowski’s Declaration.” TX 1001.1 at 121. e. “Dr. Tye declares that pharmacologically there is little difference. between olanzapine and °222; however, he states that olanzapine is clearly and significantly superior to the °222 compound based on olanzapine’s toxicological benefit.” TX 1001.1 at FH 122. On December 17, 1992, the Examiner issued a Notice of Allowability of all of the pending claims of the °382 patent, meaning that he had determined that the requirements for patentability had been met and that all previous rejections were withdrawn. TX 1001.1 at FH 156. The Examiner noted that the Notice of Allowability was in response to “Amendment B [Lilly’s Response After Final] and the declarations filed 12/10/92.” TX 1001.1 at FH 156; Killworth Tr. 792:16, 793:16. 91. ——, IV. 92. 93. 94. 95. 56a Appendix B On July 20, 1993, the PTO issued the ’382 patent. TX 1000; TX 1360. The named inventors are Dr. Chakrabarti, Dr. Tupper, and Mr. Hotten. The Validity of the ’382 Patent A. Anticipation 1. Anticipation by Chakrabarti 1980a Defendants argue the claims of the °382 patent are anticipated by Chakrabarti 1980a. One of the authors of that scientific article is Dr. Chakrabarti of Lilly. TX3465. The Chakrabarti 1980a publication describes several variations of the 4-piperazinyl-10H-thieno[2,3- b][1,5]benzodiazepine family of compounds and examines specifically three areas on the structure of the family of molecules. TX 3465; Reith Tr. 820:14- 821:10; 827:18-828:3. All compounds examined in Chakrabarti 1980a had a common structural nucleus with different substitutions at three places: the piperazine ring, the benzene ring, and the thiophene ring. TX 3465; Reith Tr. 827:18- 828:3. The authors labeled these three areas for substitution “R”, “R[1]”, and “R[2]”. TX 3465. Only particular substituents for each disclosed compound are listed in a table. TX 3465 at 880-82. 96. 97. 98. 99. 57a Appendix B In total the authors examined forty-five specific compounds (as opposed to a genus of compounds) in the 4-piperazinyl-10H-thieno[2,3-b][1,5]benzo diazepine family and 14 analogous 5-piperazinyl- substituted 4H-thieno[2,3-b][1,4]benzodiazepines, created “to compare the activity.” TX 3465 at 879, 880- 82. Significantly, olanzapine was not one of the compounds the authors examined. TX 3465; Reith Tr. 828:7-9. To arrive at their conclusions about which compounds were preferred, the authors tested the compounds by using three different animal behavioral tests: the mouse hypothermia test, the CAR test, and the rat catalepsy (“CAT”) test. TX 3465; Reith Tr. 821:16-826:5. Of these, the tests of special interest were the CAR and the CAT test. Pullar Tr. 254:4-11. The CAR test evaluates the inhibition of a behavioral response in rats. Reith Tr. 822:19-823:13. In this test, inhibition is expressed on a scale from zero to five where a score of zero reflects minor inhibition, and a score of five represents severe inhibition. Reith Tr. 823:8-13. The CAR test was the only measure of potential antipsychotic activity, and if the compound did not achieve a CAR score of three or four at a dose of less than 30 mg/kg, it was not considered active. Nichols Tr. 2768:16-2769:11. 100. 101. 102. 103. 58a Appendix B A “good score” in the CAR test — a three or four — indicates a desirable blockade of dopamine receptors. Reith Tr. 823:22-24; Pullar Tr. 222:25-223:1. Clozapine, the benchmark compound, had a CAR score of three. LaVoie Tr. 1568:11-15. The CAT test evaluates cataleptic behavior in rats following administration of a compound. The scores in this test reflect group scores, with a group consisting of eight animals. The higher the score the more catalepsy observed in the group. Reith Tr. 824:8- 825:16. Generally, for purposes of determining whether a compound has the potential to be an effective atypical antipsychotic, a scientist would like to see a “separation of activity” — i.e., a good score on the CAR test at a dose that would not get a high score on the CAT test. Reith Tr. 826:6-23; Pullar Tr. 254:4-15. However, a separation between the CAR and CAT scores only came into play if the first condition — a good CAR score — was met. Moore Dep. 82:5-22, 83:9-84:6, 86:5-14. The separation of activity between the CAR and CAT scores was thought to be relevant to the potential absence of EPS at an active or potentially therapeutic dose. The separation, by itself, is not a measure of activity. Moore Dep. 83:9-84:6, 86:5-14. 104. 105. 106. 107. 59a Appendix B Chakrabarti 1980a identified five specific compounds (9, 12, 17, 29, and 34) that were “found to be more potent than clozapine and show similar, if less marked, separation of activity in [the CAR and CAT] tests.” TX 3465 at 878, 883. The five preferred compounds had a CAR score of three or better. LaVoie Tr. 1568:16-18. With respect to these five preferred compounds, the authors expressed a preference for specific, complete compounds; they did not express a preference for a genus of compounds having any and all con -inations of the individual substituents on those molecules. Nichols Tr. 2779:2-8 (“[A] preferred compound would have a combination of different substituents that would lead it to have optimal activity. Removing one or more of those substituents would destroy that preference. So the compound would be taken as a whole.”); LaVoie Tr. 1567:11-19. Four of the five preferred compounds (9, 12, 17, and 29) have a fluorine at the 7-position of the benzene ring (compound 29 contains two fluorine atoms, one at the 7-position and one at the 8-position). Tupper Tr. 437:4-11; Nichols Tr. 2749:9-18, 2780:2-9; TX 3465 at 880-81. The fifth, compound 34, does not contain a fluorine on the benzene ring, but contains a hydroxyethyl group on the piperazine ring. Tupper Tr. 437:12-16; Nichols Tr. 2749:9-18, 2780:11-19; TX 3465 at 881. These two components were generally recognized at the time of the publication of 60a Appendix B Chakrabarti 1980a to enhance antipsychotic activity. LaVoie Tr. 1564:6-1565:4; Nichols Tr. 2785:18- 2787:22; TX 3123 at 396-97. Olanzapine does not include either of these substituents. Reith Tr. 902:5- 8; LaVoie Tr. 1564:16-18. 108. The authors did not list compound 6, the freebase of compound °222, as a preferred compound. TX 3465. Compound 6 had a CAR score of two. TX 3465 at 880; LaVoie Tr. 1568:11-15. 109. In addition to the preferred compounds, the authors discussed the authors’ preferred substituents. Reith Tr. 897:6-12. For example, the authors expressed a preference for position 7 by stating that “the substitution of the phenyl ring with a halogen atom (Cl, F) at position 7 enhanced the activity” and that the “7,8-difluoro compound (29) retained good activity.” TX 3465 at 879, col. 2. The text never states a preference for a hydrogen at position 7, as is required for olanzapine. In addition, the authors mentioned three specific substituent groups thought to be helpful: three R groups (methyl, hydroxyethyl, and hydroxypropyl), three R[1] substitutions (7-F, 7-Cl, 7,8-di-F, explained above), and three R[2] groups (2- methyl, 2-ethyl, and 2-isopropyl).. TX 3465 at 879. No possible combination of these preferred substituents, i.e., a preferred R with a preferred R{1] and a preferred R2, would generate olanzapine 3. R corresponds to the piperazine ring at the upper right of the molecule, R[ 1] to position 7, and R[2] to position 2. See TX 3465 at 880, figure labeled “1-45"; Reith Tr. 831:2-3, 853:5-18, 840:23-25. 110. 111. 112. 6la Appendix B because all of these combinations contain a fluorine (F) or a chlorine (Cl) atom at position 7 where olanzapine has only a hydrogen. Reith Tr. 897:16- 898:21; LaVoie Tr. 1566:2-12; Nichols Tr. 2777:4- 2778:6; TX 3465 at 879. Because none of the forty-five specific compounds disclosed in Chakrabarti 1980a include olanzapine, none of the five preferred compounds disclosed in Chakrabarti 1980a include olanzapine, and none of the preferred substituents include a hydrogen at position 7 as is required for olanzapine, the court finds Chakrabarti 1980a does not describe olanzapine. The court further finds that one of ordinary skill in the art, applying the preferences expressed in Chakrabarti 1980a, would not envision olanzapine. The composition and method claims of the °382 patent are directed to dosage forms containing specified amounts of olanzapine (e.g.. claim 15) and methods of treating patients suffering from schizophrenia with specified doses of olanzapine (e.g., claim 8). Such dosage forms and methods are not described in Chakrabarti 1980a for any of the compounds disclosed in that article. See Findings of Fact # # 183- 84. 113. 114. 115. 116. 62a Appendix B 2. Anticipation by Schauzu DRL also argues that olanzapine is described as compound 11 in a scientific article entitled Schauzu, H.G. and Mager, P.P., A Free-Wilson Study of 4- Piperazinyl-10H-thienobenzodiazepine Analogues, 38 DIE PHARMAZIE 562 (1983) (“Schauzu”). The biological data in Schauzu comes from Chakrabarti, J.K., et al., Effects of Conformationally Restricted 4-Piperazinyl-10H-thienobenzodiazepine Neuroleptics on Central Dopaminergic and Cholinergic Systems, J. MED. CHEM. 1133(1982) (“Chakrabarti 1982”). Nichols Tr. 2793:20-2794:9; LaVoie Tr. 1506:9-18; Reith Tr. 902:9-20. The compounds disclosed in Chakrabarti 1982 were fluorinated piperazine compounds. This means that the compounds had a fluorine in the 7-position and two nitrogens in the top ring (the piperazine ring). Nichols Tr. 2793:7-16. The structure drawn in Schauzu is not a fluorinated piperazine compound because it is missing both a fluorine atom at the 7-position and one of the nitrogen atoms in the top ring. Nichols Tr. 2792:22-2795:19. Thus, the structure drawn in Schauzu is a piperidine compound — not a piperazine as the title of the article otherwise sets forth. LaVoie Tr. 1532:5-19; Nichols Tr. 2789:3-23. 117. 118. 119. 120. 121. 122. 63a Appendix B A piperidine compound has one nitrogen in the top ring (the piperidine ring), whereas a piperazine compound, as noted above, includes a second nitrogen” substituent in the top ring (the piperazine ring). Nichols Tr. 2789:16-2790:1; LaVoie Tr. 1500:16-1501:10. Schauzu was abstracted by both Chemical Abstracts and Beilstein as disclosing piperidine compounds. Nichols Tr. 2791:10-2792:18; LaVoie Tr. 1532:3- 1535517. Olanzapine is a piperazine compound. Nichols Tr. 2795:12-16. The structure drawn in Schauzu does not include olanzapine since the structure does not include a second nitrogen in the top ring. Nichols Tr. 2792:22- 2795:19. The biological data from Chakrabarti 1982 does not include olanzapine because olanzapine is an unflourinated piperazine compound. Nichols Tr. 2789:24-2790:1, 2795:12-16. In order to find that olanzapine is described as compound 11 in Schauzu, one with ordinary skill in the art would have to mentally insert a nitrogen atom into the structure depicted in Schauzu, thereby converting it into a piperazine compound (in this case, olanzapine), yet ignore the fact that the biological data reported in the Schauzu article was from Chakrabarti EZa. 64a Appendix B 1982, which discussed only fluorinated compounds. Compare LaVoie Tr. 1500:20-1501:2, 1504:4-1507:5, with Nichols Tr. 2793:20-2794:9, 2789:16-2790:1; Reith Tr. 902:9-20. Olanzapine is not described as compound 11 in Schauzu. Nichols Tr. 2789:3-5. . Obviousness Lilly contends the discovery of olanzapine and its unique properties represent a nonobvious selection invention within the broad genus of compounds disclosed in the °574 and °568 patent. In other words, the °382 patent, which specifically claims olanzapine, is a “species” falling within the broad “genus” claimed in the °574 patent. Defendants contend that the claims of the °382 patent are obvious under 35 U.S.C. § 103 over the disclosure of olanzapine in the °574 patent in combination with Chakrabarti 1980a. They also contend the claims of the °382 patent are obvious over the disclosure of flumezapine in the °574 patent in combination with Chakrabarti 1980a and the Sullivan and Franklin article discussed infra., Findings of Fact § IV.B.1.d. 125. 126. 127. 6Sa Appendix B 1. The Scope and Content of the Prior Art a. Clozapine and Clozapine-Like Molecules The prior art included numerous failures to find a safe, atypical antipsychotic drug. See Findings of Fact § I1.D. As mentioned, clozapine, the first atypical antipsychotic, was withdrawn from the market in 1975. Thus, the challenge was to find a clozapine- like molecule that produced the benefits of clozapine without the adverse side effects. Nichols Tr. 2743:14- 2744:9; Paul Tr. 131:8-11; Schulz Tr. 3004:15-20. The prior art confirmed that small structural changes in clozapine-like molecules led to unpredictable changes in properties. Changing the position of the chlorine atom in clozapine changed it from an atypical antipsychotic to a typical antipsychotic. TX 3465 at 878 (“[Clozapine’s] 2-chloroisomer HF-2046 behaves like a classical neuroleptic. . .”); Nichols Tr. 2796:16- 2797:3; LaVoie Tr. 1543:23-1544:11; LD 45; LD 94. Changing the ring structure of clozapine led to variable and unpredictable toxicities. Tilozepine caused seizures. TX 1356, compound 3; TX 1365 at col. 12, claim 12; TX 3772 at 394 (tilozapine (NT 104-252) clinical trials terminated); Nichols Tr. 2752:15-2754:11; LaVoie Tr. 1547:11-15, 1549:24- 1551:3, 1552:115-19. Fluperlapine caused agranulocytosis in a some patients. TX 1356 at 809, 128. 66a Appendix B compound 2; TX 1387 at 155; Nichols Tr. 2745:18- 2747:9, 2751:13-2752:14; LD 87. Removal of the halogen atom from clozapine and fluperlapine (yielding perlapine) destroyed antipsychotic activity. TX 1317 at 712, col. 2; TX 3124, compound Ic; Tupper Tr. 420:1-14; Nichols Tr. 2744:22-2745:17, 2747:10-2748:10; LaVoie Tr. 1545:8-18; LD 142; LD 143. b. The ’574 Patent As noted, the °574 patent, issued on September 19, 1978, describes a family of chemical compounds of thieno[1, 5]benzodiazepines that have useful central nervous system (“CNS”) activity. TX 3129 (abstract); Reith Tr. 848:10-15. The unique properties of these compounds render them particularly “useful in the treatment of mild anxiety states and certain kinds of psychotic conditions such as schizophrenia and acute mania.” TX 3129, col. 13:62-66; Reith Tr. 853:12- 20; Nichols Tr. 2839:19-2840:1. The text of the 574 patent was written in 1975. The first compound specifically mentioned in the °574 patent is ethyl flumezapine, which is the sole compound identified as “particularly active.” The chemical name of that compound is 2-ethyl-7-fluoro- 10-(4'-methyl-1'-piperaziny])-4H-thieno[2,3- b][1.5]benzodiazepine. TX 3129, col. 4:30-34. Ethyl] flumezapine has a fluorine atom on the benzene ring. This fluorinated compound is the only compound that 131. bd. 133. 134. 67a Appendix B the °574 patent specification describes in actual examples of pharmaceutical formulations. TX 3129, Examples 37-40, col. 37, 1.62 — col. 39, 1.12; Tupper Tr. 431:20-432:22; Nichols Tr. 2749:5-9. The specification identifies about one hundred other compounds as examples of the compounds of the invention, including flumezapine and compound °222. See TX 3129, col. 4-6, 15-37. No biological data is reported, however, for any of the compounds and no specific compound, other than ethyl flumezapine, is identified as being particularly active. TX 3129. While the °574 patent claims unhalogenated compounds among the millions of compounds described in claim 1, the patent expresses a preference for halogen-containing compounds and specifically those with a halogenated substituent on the benzene ring in a location analogous to the chlorine in clozapine. TX 3129, col. 4:30-33, col. 39:42-62; Tupper Tr. 433:5-14; Nichols Tr. 2749:5-9. In fact, the patent contains six claims defining specific compounds each containing a fluorine or a chlorine atom. Tupper Tr. 433:5-14; Nichols Tr. 2749:5-9; TX 3129, claims 2-7, col. 39:42-62. Olanzapine is one of the millions of compounds within the scope of claim | of the °574 patent. TX 3129, col. 39:15-40; Reith Tr. 850:3-851:2; Hotten Dep. 160:10-22. 135. 136. 137. 138. 139. 68a Appendix B c. The Chakrabarti Articles The Chakrabarti publications also express a preference for halogen-containing compounds. Chakrabarti 1980a, previously discussed in Findings of Fact § IV.A.1, is also central to the obviousness inquiry. (1) Chakrabarti 1980a Chakrabarti 1980a reports on the in vivo behavior and toxicity testing of some individual compounds within the generic family of the thienobenzodiazepines. TX 3465. The authors expressed a preference for a halogen substituent at the 7-position of the phenyl ring. Tupper Tr. 434:12-435:3; TX 3465 at 879; Finding of Fact # 109. The five preferred compounds identified by the authors (compounds 9, 12, 17, 29, and 34) have CAR scores equal to or better than clozapine’s score of three. Tupper Tr. 436:1-437:3; TX 3465 at 880-82. Compounds 9, 12, 17, and 29 have a fluorine at the 7-position, and compound 34 has a hydroxyethyl piperazine group on the piperazine ring. TX 3465; Nichols Tr. 2780:6-18; Findings of Fact # # 105, 107. The authors also report that “[a] short alkyl substitution ({methyl], ethyl, isopropyl]) at position 2 of the thiophene ring seems to increase the activity.” 140. 141. 69a Appendix B TX 3465 at 879, col. 2. The authors compare the effect of a short alkyl substitution at position 2 versus a t- buty! substitution, a 2-hydrogen substitution, or other higher alkyl substitution. TX 3465 at 879, col. 2; Tupper Tr. 486:2-25. The only series of data that allows for each of these comparisons is based on results from fluorinated compounds. Tupper Tr. 435:10-25. (2) Chakrabarti 1982 In Chakrabarti 1982 the authors further confirmed the belief that neuroleptic substituents, such as fluorine atoms, were necessary for good antipsychotic activity. Each of the twelve thienobenzodiazepines described contains a fluorine atom at the 7-position. Reith Tr. 916:2-16; Nichols Tr. 2749: 18-24; TX 3131 at 1135. The article specifically identifies fluorinated compounds “2 and 9” (flumezapine and ethyl flumezapine) as having “potent. . . activity.” TX 3131 at 1137; Nichols Tr. 2749:18-24. (3) Chakrabarti 1989 In J. K. Chakrabarti et al., Synthesis and Pharmacological Evaluation of a Series of 4- Piperazinylpyrazolo [3,4-b]-and-[4,3-b][1,5] benzodiazapines as Potential Anxiolytics, J. MED. CHEM. 2573 (1989) (“Chakrabarti 1989”), the authors reflected the ultimate preference for a fluorine substitution in this class of molecules by reporting that the fluorinated compound flumezapine “was 142. 143. 144. 70a Appendix B chosen as a candidate for clinical trial.” Reith Tr. 922:25-923:3:; Nichols Tr. 2749:25-2750:3; TX 3132 at 2574. d. The Sullivan and Franklin Article Sullivan and Franklin, /n Vitro Thiomethylation, DRUG, METABOLISM, AND DISPOSITION 276 (1985) (“Sullivan and Franklin”), reports a study in which flumezapine was administered to dogs and rats. The study found that a methylthio metabolite arose from the metabolism of flumezapine in the test animals. Nichols Tr. 2774:20-2775:10, 2843:23- 2844:3; TX 3161. There is some toxicity associated with compounds that are metabolized via methylthio metabolites. TX 3161; Nichols Tr. 2844:8-13. Sullivan and Franklin does not teach that the methylthio metabolic product is toxic. Reith Tr. 928:13-16; Nichols Tr. 2775:12- 18. In addition, the article does not specifically state that flumezapine is toxic. Reith Tr. 927:9-11; Nichols Tr. 2775:11-13. The article describes that during the metabolism of flumezapine, the fluorine at the 7-position is replaced by a methylthio group. Thus, one with ordinary skill in the art may have been motivated, based on the resulting potential toxicity from the metabolic process as described in the article, to consider developing a compound without the fluorine atom. Reith Tr. 858:22-859:6. There is, however, nothing in the article 145. 146. 147. 148. T7la Appendix B to suggest that a hydrogen atom in place of the fluorine atom at the 7-position (yielding olanzapine) would be desirable, Nichols Tr. 2776:5-11, or that to make such a substitution would avoid the formation of the methylthio metabolite. Reith Tr. 929:11-18. The article does not teach that replacing the fluorine with a hydrogen would stop the formation of the methylthio metabolite. Indeed, acetaminophen (Tylenol(R)), a non-fluorinated compound, also forms a methylthio metabolite. Reith Tr. 928:17-928:21; Nichols Tr. 2776:5-11. 2. Ordinary Skill in the Art A person of ordinary skill in the art in this case would be a scientist with a Ph.D. in medicinal chemistry, pharmacology, or a similar discipline. Reith Tr. 819:23-820:6; Nichols 2850:25-2851:4; LaVoie 1527:22-1528:1. Lilly’s expert, Dr. David Nichols (“Dr. Nichols”), is personally familiar with the search for a safe, atypical antipsychotic, the relevant scope and content of the prior art, and the capabilities of a person of ordinary skill in the art. The court qualified him as an expert in medicinal chemistry. Nichols Tr. 2737:13-14. Dr. Nichols obtained a Ph.D. in medicinal chemistry from the University of Iowa in 1973. Nichols Tr. 2733:25-2734:2; TX 3764.1. Dr. Nichols worked in the 1980s on developing antipsychotic compounds with an atypical activity profile; that is, active 149. 150. 72a Appendix B antipsychotics, but with few side effects. Nichols Tr. 2735:13-2736:17. Dr. Nichols has taught the subject of antipsychotics for many years, including during the time period of the prior art at issue in this case. Nichols Tr. 2734:8-21. Dr. Nichols also has personal experience with the behavioral tests and other screening tests relied upon in Chakrabarti 1980a. Nichols Tr. 2735:25-2736:7. The focus of Dr. Nichols’ research, however, has been hallucinogens and doparnine receptors. Nichols Tr. 2812:24-2813:6. The court qualified Zenith’s expert, Dr. Maarten Reith (“Dr. Reith”), as an expert in the field of molecular pharmacology and neuropharmacology. Reith Tr. 815:25-816:16. Dr. Reith has extensive experience with respect to dopamine and serotonin receptors, TX 3170, the specific areas of the brain at which the effects of antipsychotics are observed. TX 1000, col. 2:45-57; col. 7:6-59. Further, Dr. Reith demonstrated substantial knowledge of the tests used in Chakrabarti 1980a, as well as those reported in the declarations of Lilly’s scientists. See e.g., Reith Tr. 821:16-827:17, 865:1-866:24. 3. The Differences Between the Claimed Invention and the Prior Art Structurally, olanzapine differs from clozapine in that olanzapine has a methyl-substituted thiophene ring in place of the benzene ring in clozapine. Olanzapine also has a hydrogen in place of the chlorine on its benzene ring. See e.g., LD 52; LD 80. Clozapine caused agranulocytosis in humans. Paul Tr. 117:3-24. 151. 152. 133. 154. 73a Appendix B Olanzapine differs structurally from ethyl flumezapine by replacement of the fluorine and ethy] group in ethyl flumezapine with a hydrogen and methyl group respectively. See e.g., LD 48; LD S52. Ethyl flumezapine caused widespread blood problems in dogs; olanzapine did not. Nichols Tr. 2798:4- 2800:25. Olanzapine differs structurally from flumezapine, described as the lone clinical trial candidate out of this series of compounds, by substituting a hydrogen atom for the fluorine atom in flumezapine at the 7- position of the benzene ring. See e.g., LD 49; LD 52; Nichols Tr. 2801:1-2802:11. Olanzapine differs structurally from its ethyl analog, compound °222, by replacement of the ethyl group with a methy! group at the 2-position of the thiophene ring. See e.g., LD 50; LD 52. In Lilly’s D07290 Study, compound 222 caused a significant increase in cholesterol in female beagle dogs; olanzapine did not. TX 1001.1 at FH 149-54; McGrath Dep. 85:13-89:12. 4. Motivation Provided By the Prior Art to Make Olanzapine a. Compound 222 as the Beginning Compound The 574 patent specifically names over one hundred compounds, including compound °222. TX 3129, col. 4-6, 15-37, Example 26(a). The patentees did not 155. 156. 157. 74a Appendix B differentiate compound °222 from the other exemplary compounds in the way that they did with ethyl flumezapine. TX 3129, col. 4:30-34. Compound:’222 is not halogenated and, therefore, does not satisfy the preference expressed in the 574 patent itself, in Chakrabarti 1980a, Chakrabarti 1982, or Chakrabarti 1989. Nichols Tr. 2748:11- 2750:9, 1772:18-1773:2; Reith Tr. 898:12-899:10, 914:7-915:4, 916:2-16, 922:9-923:3; LaVoie Tr. 1566:5-12. (1) Compound ’222’s Activity Chakrabarti 1980a did not provide specific motivation to use compound °222 as a starting point for further research. In fact, the article reported that compound °222, corresponding to compound 6 in Table I, did not have the minimum CAR score of three required for a suitable atypical antipsychotic agent and thus was not considered a preferred compound. Pullar Tr. 227:1-22; LaVoie Tr. 1568:11-1569:3;TX 3465 at 880-82. (2) Hydrogen as a Preferred Substituent Chakrabarti 1980a also did not provide specific motivation to substitute a hydrogen in the 7-position. One skilled in the art would not have recognized from compounds 6, 34, and 36 in Chakrabarti 1980a that a hydrogen in the 7-position was a desirable substituent. 158. 159. 160. 75a Appendix B (a) Compound 6 } Chakrabarti 1980a reported that compound 6 had a CAR score of two at 10 mg/kg. LaVoie Tr. 1568:11- 1569:3; Pullar Tr. 227:1-22; Tupper Tr. 437:22-438:2; Nichols Tr. 2772:18-2773:2; TX 3465 at 880-81. A better CAR score for compound 6 could not be achieved by increasing the dose, since higher doses would cause the test animal to completely stop responding to the test stimuli due to muscular incoordination. Pullar Tr. 223:8-224:2. Dr. Pullar explained that increasing the dose caused the test animals to completely stop responding to the test —- a distinctly negative outcome. These results, based on tests with the compound administered orally, were corroborated with other results using intraperitoneal (IP) administration. Increasing the dose in both cases could not increase the activity of compound 6 above the substandard CAR score of two. Pullar Tr. 224:18- 228:3; TX 3470. The evidence does not support the argument that a person of ordinary skill in the art would presume that compound 6’s corresponding free base (compound °222) would be more active. The difference between a maleate salt and a free base is just their physical forms, with salts typically being used for ease of handling. It is the same molecule in both forms. Tupper Tr. 504:20-505:8. As Dr. Tupper explained, the form (salt or free base) does not fundamentally change the pharmacological action. Tupper Tr. 505:5- 161. 162. 76a Appendix B 8. There are some differences in the way the body processes the salt of a compound versus its free base due to the varying size of the particles. But if administered to achieve equal concentrations in the blood, the free base and maleate salt should produce the same results, and one would expect the same activity between the two forms. Nichols Tr. 2883:10- 16; Tupper Tr. 505:11-17. Indeed, prior to trial, Dr. Reith made no distinction between compound 6 and its free base (compound 222) and actually treated them interchangeably. Reith Tr. 909:8-20. Accordingly, one of ordinary skill in the art would not have understood from a close reading of Chakrabarti 1980a that compound 6 was a preferred compound, and hence, that a hydrogen in the 7- position would have been preferred. (b) Compound 36 Chakrabarti 1980a reported that compounds 34, 35, and 36 “retained good activity.” TX 3465 at 879, col. 2 (“However, compounds (34-36) ... retain good activity.”). The statement regarding the activity of compounds 34-36 was made in the context of comparing the compounds, in which each had a hydroxyethyl! or hydroxypropy! on the piperazine ring (and which had good activity), to compounds 31-33 having other substituents on that ring (and which were less active or inactive). Nichols Tr. 2830:18-2831:14; TX 3465 at 879. 163. 164. 165. 166. 77a Appendix B Compound 36 received a CAR score of two at a dose of 10 mg/kg, and a CAT score of two at a dose of 12.5 mg/kg. As stated previously, a CAR score of two was not preferred. Pullar Tr. 227:1 22, 255:12-256:13. Dr. Tupper testified that because of the manner in which the test was scored, a reported CAR score of two encompassed a broad range of activity ranging from a 31% to 50% block of the conditioned avoidance response. Pullar Tr. 229:12-230:14; TX 3465 at 882 n.d. Only the authors knew where in that score range each compound fell, and there is no way for the reader to second guess the judgment of the authors as to which compounds were “good” and which were not. Pullar Tr. 294:15-24; Nichols Tr. 2778:12-22; LaVoie Tr. 1561:17-25. Therefore, the fact that the authors stated that compound 36 “retained good activity” with a CAR score of two can at most be interpreted as a reference to a compound at the high end of the “two” range approaching a 50% block. It cannot be taken as a statement that all compounds with a reported CAR score of two (with activities as low as 31%) were good, active compounds when the remaining text of the article indicated that they were not. One of ordinary skill in the art would not have understood from a reading of Chakrabarti 1980a that compound 36 was a preferred compound. The fact that the authors’ stated that compound 36 “retained good activity,” read in its proper context, is not evidence to the contrary. 167. 168. 169. 78a Appendix B (c) Compound 34 Compound 34 is singled out by the authors as a preferred compound. TX 3465. This compound, like olanzapine, has a hydrogen substituent at the R1 or 7-position, but, unlike olanzapine, also has a hydroxyethyl] piperazine group on the piperazine ring. Such hydroxyethyl piperazine groups were known to enhance the activity of antipsychotic drugs. LaVoie Tr. 1564:24-1565:4, 1567:11-22; Nichols Tr. 2779:25- 2786:22 (“There was a recognition in the art that a hydroxyethyl had special properties . .. In general, the compounds were more potent. They usually had better brain penetration. . .”). The identification of five preferred compounds by Chakrabarti 1980a, each of which had either a fluorine or a hyroxyethyl piperazine substituent, could not rationally be read by a person actually skilled in this field to be an expression of preference for compounds like olanzapine that have neither a fluorine atom nor a hydroxyethyl piperazine group. Nichols Tr. 2786:12-2788:8; Reith Tr. 901:15-902:8. Nothing in Chakrabarti 1980a provides motivation for a person with ordinary skill in the art to begin with compound °222 over one of the compounds the authors endorse as preferred. Nichols Tr. 2272:22- 23, 2273:1-12. 170. 171. 79a Appendix B b. Changing the 2-methyl in Compound °222 to a 2-ethyl One skilled in the art would not have been motivated to modify compound ’222 by changing the ethyl group to a methyl group at the 2-position of the thiophene ring because there is no suggestion in the °574 patent or any other prior art that such a modification would have increased activity and decreased unwanted side effects. Reith Tr. 915:20-916:1; LaVoie Tr. 1562:1- 6; Nichols Tr. 2772:18-2774:7. Even if a person of ordinary skill in the art were motivated to begin with compound 222, he would modify it by adding a halogen atom to give it the neuroleptic substituent believed at the time to be required for antipsychotic activity. Nichols Tr. 2773:13-19. Although Chakrabarti 1980a reports that “[a] short alkyl substitution ({methyl, ethyl, isopropyl]) at position 2 of the thiophene ring seems to increase the activity,” TX 346S at 879, col. 2, the article does not state that any particular short alkyl group will provide better results than any other short alkyl group. Reith Tr. 915:20-916:1; LaVoie Tr. 1574:2-4; Nichols Tr. 2273:20-2274:7. The only compounds for which data is given allowing comparison of hydrogen at the 2-position with all of the “short alkyl” substitutions at the 2-position (as well as the longer alkyls, e.g., “bulky t-Bu group”) as described in the text are compounds 8 through 21 — all of which have a fluorine at the 7-position of the 173. 174. 175. 80a Appendix B benzene ring. Tupper Tr. 435:20-25; Reith Tr. 915:5- 19; LaVoie Tr. 1574:2-9; TX 3465 at 880-81. Compounds 6 and 7, neither of which is identified as preferred, provide an isolated example of a comparison between a short alkyl substitution and a t-butyl substitution in unfluorinated compounds. Tupper Tr. 487:1-7. Regardless of this one comparison, the paragraph in Chakrabarti 1980a in which this preferred substituent is revealed states a preference for short alkyl groups in the context of a fluorinated series of compounds; thus the article does not generally provide mc tivation or guidance relating to the effect of such substitution on fundamentally different unfluorinated molecules. Reith Tr. 915:5-19; Nichols Tr. 2772:18-2774:7. c. Replacing the Fluorine Atom in Flumezapine with a Hydrogen Atom Defendants contend that one of ordinary skill in the art would have been motivated to replace the fluorine atom in flumezapine with a hydrogen atom in the 7- position of the benzene ring to arrive at olanzapine. In light of the general state of the art, including the teachings of the °574 patent and Chakrabarti 1980a, Chakrabarti 1982, and Chakrabarti 1989, one of ordinary skill in the art would have expected that replacing the fluorine atom with a hydrogen atom would produce a compound without sufficient antipsychotic activity. Nichols Tr. 2776:5-11. 176. 177. 8la Appendix B While Chakrabarti 1980a suggests that a chlorine atom in place of the fluorine atom would also enhance the compound’s activity, it does not specifically suggest that the same result could be obtained with a hydrogen atom. Nichols Tr. 2779:17-24; TX 3465 at 879, col. 2. Nor does anything in Sullivan and Franklin suggest the desirability of using a hydrogen atom at this position. Nichols 2776:5-11; TX 3161; Findings of Fact § IV.B.1.d. If one were looking to replace the fluorine, one would replace the fluorine with other electronegative groups, not hydrogen. TX 1315 at 3172; LaVoie Tr. 1572:12-1573:18. Indeed, the art as a whole teaches directly away from using hydrogen because it is not an electron-withdrawing substituent. Nichols Tr. 2773:3-12. Moreover, the 1990 publication, Davis et al., Chloro- Substituted, Sterically Hindered 5,11 Dicarbo Analogues of Clozapine as Potential Chiral Antipsychotic Agents, J. MED. CHEM, 809 (1990), proposed that the possible toxicity of candidates that were being investigated as safe alternatives to clozapine (including flumezapine) might be due to the presence of so-called “hetero atoms” — nitrogens and sulfurs — in the three-ring system of those compounds. Nichols Tr. 2757:21-2758:10; TX 1356 at 809. Those hetero atoms have nothing to do with the fluorine atom, and if those hetero atoms were removed, one would not obtain olanzapine. Nichols Tr. 2757:21-2758:16; TX 1356. 178. 82a Appendix B 5. Reasonable Expectation of Success By April 1990, a person with ordinary skill in the art knew facts that would have foreclosed a reasonable expectation of success with other clozapine-like compounds. These include: (1) the first known atypical antipsychotic drug, clozapine, was known to interact with a large number of receptors in the brain, including dopamine receptors, serotonin receptors, and cholinergic receptors, Paul Tr. 121:20-122:8, LaVoie Tr. 1541:24-1542:8, Nichols Tr. 2763:6- 2765:10; (2) it was not known through what combination of these or other receptors clozapine exerted its atypical antipsychotic action, Nichols Tr. 2763:6-16; (3) it was not known why clozapine caused agranulocytosis in humans, Paul Tr. 121:14-17, Nichols Tr. 2769:13-17; (4) many compounds identified in patents and publications during the 1970s and 1980s as potential antipsychotic drugs had failed in clinical trials due to lack of efficacy, lack of atypicality, and/or an array of adverse side effects, Nichols Tr. 2751:1-2757:14; TX 1356; (5) small structural changes in clozapine-like molecules yielded great and unpredictable changes in properties, Pentel Tr. 1926:25-1927:9; Nichols Tr. 2796:6-2804:14; and (6) many researchers made a large number of compounds over a long period of time in an effort to find a safe, atypical antipsychotic drug and failed. Nichols Tr. 2743:14-2744:17, 2751:1-4; TX 1397 at ZY 19 66. 179. 180. 181. 83a Appendix B In 1990, a skilled artisan would have believed that a halogen atom on clozapine was important for its antipsychotic activity, that the particularly active members of the thienobenzodiazepine family had a halogen, and that the only member of that family of compounds to be advanced to clinical trials, flumezapine, had a halogen atom. Nichols Tr. 2748:11-2750:9, 2772:18-2773:2; Reith Tr. 916:2-16; LaVoie Tr. 1566:5-12; TX 3129; TX 3131; TX 3132; TX 3465. A person of ordinary skill in the art would not likely assume that the halogen substituent widely used on this class of compounds could be eliminated without adverse effect. Nichols Tr. 2774:8-19. In 1990, a skilled artisan would not have reasonably expected, based on the data from the animal tests, that any of the compounds identified in Chakrabarti 1980a would be effective antipsychotics. The animal behavioral tests reported in Chakrabarti 1980a were only indicators of potential antipsychotic activity. Reith Tr. 929:22-930:17; Nichols Tr. 2768:16- 2769:11. Moreover, these animal tests were not indicative of a compound being a safe, atypical antipsychotic, which was the goal of researchers after the toxicity of clozapine was recognized in patients. Pullar Tr. 173:21-174:12; TX 1031 at ZYP 506 1725; Reith Tr. 930:5-932:12; Nichols Tr. 2768:16-2769:24; Tupper Tr. 457:20-458:2. Indeed, the two most preferred compounds identified as showing good activity in the Chakrabarti prior art, flumezapine and ethyl 182. 183. 84a Appendix B flumezapine, turned out to be toxic. Pullar Tr. 180:2- 181:8, 188:13-189:14. Thus, there would have been no reasonable basis from Chakrabarti 1980a to expect that new compounds such as olanzapine would have been safe, atypical antipsychotics. In light of these facts, at the time olanzapine was developed, there could have been no reasonable expectation of success that an unhalogenated compound structurally similar to compound °222 would succeed as a safe and effective atypical antipsychotic. 6. Composition and Method Claims Claims 2, 3, 7, 8, and 15 are the composition and method claims of the °382 patent. TX 1000. a. Claim 1 claims the compound olanzapine. TX 1000, col. 12. b. Claims 2, 3, and 15 claim “pharmaceutical compositions” of the compound claimed in claim 1. TX 1000, col. 12. c. Claim 7 claims a method for treating an animal suffering from or susceptible to schizophrenia using the compound claimed in claim 1. TX 1000, col. 12. 184. 85a Appendix B d. Claim 8 claims “[a] method of claim 7 wherein the effective amount is from 0.1 to 20 mg per day” of the compound claimed in claim 1. TX 1000, col. 12. The °574 patent, the Chakrabarti publications, and the Sullivan and Franklin article do not teach or suggest either the use of olanzapine in amounts less than 20 mg/day to treat schizophrenia or the dosage forms for such treatment. Dr. Reith and Dr. LaVoie did not offer any trial testimony that the references teach or suggest what an “effective amount” of olanzapine would be to treat a human suffering from or susceptible to schizophrenia. Dr. Reith agreed that the °574 patent refers to doses in the range of 0.1 to 20 mg/kg/day, equivalent to between 7 and 1400 mg/ day for a 70 kilogram (150 pound) person, and that the °574 patent provides no guidance as to where in that range one should treat an actual schizophrenic patient with olanzapine. Reith Tr. 905:8-906:3. Similarly, Dr. LaVoie conceded on cross-examination that the °574 patent referred to 0.1 to 20 mg/kg/day while the °382 patent referred to 0.1 to 20 mg/day, a 70-fold difference for a 70 kilogram (150 pound) person. LaVoie Tr. 1574:23-1575:9. 185. 186. 187. 188. 86a Appendix B 7. Secondary Considerations a. Long-Felt Need Beginning at least as early as 1975, there was a long- felt need for a safe, atypical antipsychotic drug that remained unsatisfied at the time Lilly filed the olanzapine patent application in 1990. Nichols Tr. 2751:1-4, 2808:5; Schultz Tr. 2971:8-2972:17; TX 1397 at ZY 19 66 (“The medical need for better antipsychotic drugs in terms of increased efficacy and fewer unwanted effects is great”). Numerous investigators, including scientists at Lilly, tried but failed to develop a safe, atypical antipsychotic drug between 1975 and 1990. Nichols Tr. 2751:1-12; Schulz Tr. 2971:8-2972:17; TX 1356; TX 1397 at ZY 19 46-48, 54-58, 66. Risperidone (marketed and sold by Jansen Pharmaceuticals as Risperdal) is an atypical antipsychotic. It was first prescribed to schizophrenic patients in February 1994. Olanzapine (marketed as Zyprexa) was first prescribed in October 1996. Schulz Tr. 2987:15-17, 2988: 15-17; Kinon Tr. 2526:24- 2527:2; TX 1590; LD 113. Risperidone and olanzapine are prescribed by doctors more than any other atypical antipsychotic on the market. See TX 1590. Risperidone, however, is prescribed more often than olanzapine. TX 1590 at 189. 190. 191. 192. 193. 87a Appendix B ZYP 528 16; LD 113; Paul Tr. 150:13-151:2; see also Finding of Fact # 193. There is no evidence in the record to establish when the risperidone patent application was filed. Because risperidone was not prescribed or otherwise available to schizophrenic patients at the time the ’382 patent was filed, olanzapine met the long-felt but unsolved need for a safe, atypical antipsychotic. b. Failure of Others As reflected in the court’s previous findings, there was a failure by others to develop a safe, atypical antipsychotic drug prior to the filing of the olanzapine patent application in the U.K. See Findings of Fact § II.D. c. Commercial Success Since late 1996, when olanzapine was approved for use, it has captured significant market share in terms of the number of prescriptions written for antipsychotic medications. TX 1590. In 2001, olanzapine accounted for more than 25% of all antipsychotic prescriptions written, and risperidone accounted for more than 29% of all antipsychotic prescriptic » vritten. TX 1590. 194. 195. 196. 197. 198. 88a Appendix B In 2001, olanzapines’ U.S. sales were $ 2.18 billion, representing one third of Lilly’s revenues for that yea [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386008_1138%3A2. Public record. Not legal advice.