Altaire Pharmaceuticals, Inc. v. Paragon Bioteck, Inc.

Docket No. 2017-1487 (PGR2015-00011)

May 2, 2018

Brief summary: PTAB FWD after PRG of Paragon’s patent relating to the use of chirally pure R-phenylephrine in ophthalmic compositions reversed-in-part, vacated-in-part, and remanded.

Summary: Altaire appealed PTAB final written decision (FWD) following post-grant review (PGR) finding the Asserted Claims of Paragon’s US 8,859,623 relating to “methods for using an ophthalmic composition…comprising R-phenylephrine having an initial chiral purity of at least 95%…after 6 months” for pupil dilation were not proven to be unpatentable for obviousness. In 2011, Altaire and Paragon agreed to collaborate on an NDA, with Altaire being responsible for “chemistry, manufacturing, and controls” and Paragon handling “preparing and submitting” NDAs. The FDA required Paragon to “[c]onsider adding a chiral purity test to the d[r]ug product specification or provide a justification for not doing so”, and Altaire provided a summary of optical rotation tests and HPLC analyses (“on Lots #11578 and #11582, which it internally refers to as ‘TMQC-247’”). The FDA then approved Paragon’s. Paragon’s counsel then proposed an amendment to the Agreement ‘to address [a] new patent application filing’” relating to formulation, processes, and controls that Altaire believed “were developed solely by” Altaire’s Mr. Al Sawaya, and was not contemplated by their Agreement. Paragon subsequently filed the patent application that led to the ‘623 patent. Altaire and Paragon later each alleged in complaints that the other breached the nondisclosure clause of their Agreement. Altaire then filed a petition for PGR, arguing that the Asserted Claims would have been obvious over its previously prepared drug lots. In its FWD, the PTAB determined that Altaire failed to timely qualify Mr. Al Sawaya as an expert,…the TMQC-247 test data were entitled no weight,…and the optical rotation test data were unpersuasive”. The FC first found that Altaire had Article III standing for this appeal since it “sufficiently demonstrated imminent harm” (Prasco, FC 2008; Caraco, FC 2008) (e.g., “Paragon is actively seeking a [DJ] that it has the right to terminate the Agreement”) that was “concrete and particularized” (Spokeo, US 2016) (e.g., the § 325(e)(2) estoppel provision (“petitioner in a” PGR “may not assert…in a civil action” invalidity “on any ground that the petitioner raised or reasonably could have raised”) (not an injury in fact “when…the appellant is not engaged” in infringing activity (Phigenix, FC 2017)) (Judge Schall disagreed). The FC panel reviewed the PTAB’s procedures for an abuse of discretion (Redline Detection, FC 2015), and first found its refusal to enter Mr. Al Sawaya’s declaration was improper (Aqua Prods., FC 2017) (e.g., affidavit does not need to be by an expert (§ 42.65(b); Graver Tank, US 1950; Ultratec, FC 2017). It also found an abuse of discretion in the PTAB’s refusal to assign the TMQC-247 test data any evidentiary weight since Altaire submitted it “at the first opportunity” because Paragon had relied on it in front of the FDA. The FC panel also found the PTAB’s rejection of the optical rotation data was an abuse of discretion as it was also related to Mr. Al Sawaya’s declaration. The FC panel therefore reversed-in-part, vacated-in-part, and remanded the decision (including the obviousness decision).

This entry was posted in Article III disputes, Obviousness, Post-grant review. Bookmark the permalink.

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