The Coalition for Affordable Drugs, the group controlled by billionaire J. Kyle Bass’s Hayman Capital Management and IP Navigation Group founder and owner Erich Spangenberg, won institution of four more inter partes review petitions, this time against Celgene Corp.’s patents.

The decision on institution of IPR2015-01092, which concerned a pregnancy-prevention program for women prescribed a thalidomide derivative used for treating acne was handed down today by the Patent Trial and Appel Board and Administrative Patent Judges Michael Tierney, Grace Karaffa Obermann and Tina Hulse.

The decision on institution of IPR2015-01103, IPR 2015-01102 and IPR 01096, which concerned U.S. Patent 6,315,720 B1, a method for delivering a drug to a pregnant woman without harming her fetus, were handed down today by Administrative Patent Judges Michael Tierney, Michael Kim and Tina Hulse.

Separately, the another PTAB panel denied institution of the coalition's petition IPR2015-2015-01086 related to Biogen Idec's 8,759,393 B2 patent related to pharmaceutical preparations for certain dialkyl fumarates in the form of microtablets or micropellets, for the treatment of autoimmune diseases such as polyarthritis, multiple sclerosis and juvenile onset diabetes. The denial was handed down by Administrative Patent Judges Lora Green, Jacqueline Wright Bonilla and Tina Hulse.

Last week, the PTAB instituted two IPR petitions filed by the coalition against a patent related to Gattex, a treatment for short bowel syndrome developed by NPS Pharmaceuticals, which was later acquired by Shire Plc. Bass and Spangenberg previously also won institution of an IPR challenging the validity of the patent behind the drug Lialda, a treatment for Crohn’s disease also owned by Shire.

Bass and Spangenberg’s coalition has now had 7 institution wins and 4 denials. The PTAB previously declined to institute petitions filed by the coalition to invalidate a patent for the narcolepsy drug Xyrem, which is owned by Jazz Pharmaceuticals. The PTAB also declined to institute IPRs filed against Biogen and Acorda Therapeutics.

In the petition against the '501 patent, the coalition relied upon the following prior art: "Guideline for the clinical use and dispensing of thalidomide, R.J. Powell and J.M.M Gardner-Medwin, Postgrad Med. J. (1994) 79, 901–904; A Pregnancy-Prevention Program in Women of Childbearing Age Receiving Isotretinoin, Allen A. Mitchell et al.; Pharmacists’ role in clozapine therapy at a Veterans Affairs medical center, Benjamin R. Dishman et al; Effects of the Clozapine National Registry System on Incidence of Deaths Related to Agranulocytosis, Gilbert Honigfeld, PsychiatricServices (Jan. 1996) 47:1, 52–56; and Thalidomide: Potential Benefits and Risks, An Open Public Scientific Workshop, Program and Abstracts, Office of the Director National Institutes of Health (Sept. 9-10, 1997)."

“We are persuaded, on this record, that the combined disclosures of Powell, Mitchell, and Dishman would have prompted a skilled artisan to implement a pregnancy-prevention program for thalidomide patients that makes mandatory the use of a registry for patients, prescribers, and pharmacies; that limitation is suggested by Dishman’s disclosure of registering a pharmacist’s verification before any patient is authorized to receive a drug,” the panel said.

“Based on the information presented, moreover, petitioner shows sufficiently that Dishman would have led a skilled artisan, seeking to improve the methods of Powell and Mitchell, to maintain the mandatory registry of records in a computer readable storage medium for ‘ease in sharing and storing.’ Pet. 26 (quoting Ex. 1002 ¶ 114).

“The only practical reason for storing information in a computer readable medium is to permit later retrieval of that information. Cf. Prelim. Resp. 32–33 (arguing that a failure to identify a prior art disclosure of a ‘retrieval’ step dooms petitioner’s challenge)."

“Furthermore, Dishman’s disclosure of registering a pharmacist’s verification, before any patient is authorized to receive a drug, implies a retrieval of such information. On this record, the applied prior art suggests a method of registering prescriber, pharmacy, and patient information in ‘a computer readable storage medium,’ and retrieving information necessary to ensure that prescriptions for a teratogenic drug are authorized for only non-pregnant patients."

“Petitioner shows sufficiently that the invention of claim 1 represents the ‘predictable use of prior art elements according to their established functions.’ Based on the information presented, claim 1 is directed to a combination of known steps (registering patients, prescribers, and pharmacies in a computer readable medium; identifying and counseling a subpopulation of patients whose access to a teratogenic drug should be restricted; and authorizing drug therapy only for non-pregnant patients) to accomplish a known purpose (prescribing drug only to non pregnant patients) and achieve a predictable result (preventing fetal exposure to the drug).

The panel also found that “petitioner’s arguments and evidence, including the detailed claim charts, establish adequately that the subject matter of the dependent claims would have been obvious over the combined teachings of Powell, Mitchell, and Dishman.”

The panel said it found unpersuasive the patent owners arguments that petitioner failed to explain adequately how the applied art would have led one of ordinary skill in the art to modify Powell’s teaching to use a 3-month supply of thalidomide to arrive at the claimed 28-day limitation.

“Patent owner’s argument is not persuasive based on the record developed at this stage,” the panel said. “In that regard, petitioner directs us to Powell’s disclosure ‘that, initially, ‘follow-up visits’ with prescribing physicians ‘should be at monthly intervals or less.’”

The panel also said the petitioner also advances evidence that one of ordinary skill in the art would understand that the follow up visits would be required before additional drug was dispensed.

“And petitioner comes forward with information that a skilled artisan would have arrived at a 28-day restriction based on the ‘general knowledge in the field’ that the ‘average woman’s menstrual cycle is approximately 28 days.’ Where ‘avoidance of pregnancy is of paramount importance,’ and ‘oral contraceptives are prescribed’ in 28-day cycles, petitioner shows sufficiently that ‘the claimed time period aligns with other prescribing habits of physicians.”

“On this record, there is a reasonable likelihood that petitioner would prevail in showing that the subject matter of claims 2–10 would have been obvious over Powell, Mitchell, and Dishman.”

In the three petitions instituted on the '720 patent, the PTAB ruled that the patent was obvious based on some of the same prior art at issue in the petition against the '720 patent.

"We are persuaded that petitioner’s arguments, evidence and detailed claim charts establish adequately that the subject matter of the independent and dependent claims would have been obvious over the combined teachings of the prior art."

The panel also rejected Celgene's arguments that the the petition should be denied because it is being used for an improper purpose, something previously considered in Celgene's motion for sanctions, which also was rejected.

"We have already considered and rejected patent owner’s argument in our decision on sanctions motion. Patent owner also states that petitioner has failed to name all the real parties-in-interest (RPIs) and contends that unnamed investors, beneficial owners, general partners, managers, trustees, and directors of certain hedge funds are real parties-in-interest.

"Whether a party who is not named as a participant in a given proceeding constitutes an RPI is a highly fact dependent question that takes into account how courts generally have used the terms to 'describe relationships and considerations sufficient to justify applying conventional principles of estoppel and preclusion.'”

"A patent owner challenging a petitioner’s RPI disclosure must provide sufficient evidence to show the disclosure is inadequate to bring a petitioner’s identification of the RPIs into question. To that end, the evidentiary record before us presents little information as to how any of the identified categories of alleged RPIs controlled the proceeding, paid expenses, or participated in the proceeding such that conventional principles of estoppel and preclusion would apply. On this record, patent owner has failed to identify credible and sufficient evidence to bring into question whether the various categories of individuals constitute RPIs in this

Greg Geissman, a Celgene spokesman, in an emailed statement, played down the significance of the institution decision.

“This action by PTAB is one step in a process that will now continue over the next year," Geisman said. "We remain confident in the strength of our patent estate, and we plan to defend our intellectual property vigorously.”

Paul Skiermont, a partner with Skiermont Puckett LLP in Dallas, who represented the coalition, said in an emailed statement the Celgene patent the PTAB instituted for review today is unique because it is listed in the FDA’s Orange Book for not one, but three Celgene drugs: Thalomid, Revlimid, and Pomalyst.

Skiermont said it is also unique because it has nothing do with chemistry or disease treatment—instead this patent covers an obvious method of restricting the distribution of drugs using a computerized pharmacy.

"Celgene has asserted this patent—which the PTAB found today is likely invalid—in litigation against multiple generic companies to prevent the sale of cheaper generic versions of Thalomid and Revlimid. Celgene’s patent-conferred monopoly results in Revlimid prices that exceed $580 per pill, which creates costs in excess of $200,000 per patient year.

Skiermont noted that Celgene succeeded in delaying merits-based review of this patent in litigation for over 9 years—first by settling with a generic challenger, and then by convincing a district court to impose a stay of the proceedings related to the validity of the ’501 patent filed by a different generic challenger.

"The coalition is gratified that the PTAB rejected Celgene’s attempt to once again prevent a merits-based review of this patent when it denied Celgene’s motion for sanctions last month, and that as a result of today’s PTAB decision—the first merits-based review of a patent Celgene has used for the better part of a decade to delay generic entry of two drugs—the day of reckoning for this likely invalid patent has finally arrived."

In denying the petition against Biogen's '393 patent, the PTAB panel was unpersuaded by the coalition's choice of prior art -- Nieboer et al., Systemic Therapy with Fumaric Acid Derivates: New Possibilities in the Treatment of Psoriasis, 20 J. AMER. ACAD. DERM. 601–08 (Apr. 1989) and Kolter et al., which concerned U.S Patent No. 5,681,588, issued Oct. 28, 1997.

Nieboer resolved a gastrointestinal issue that was created by the quick release of dialkyl fumarate by recommending the use of a controlled release form of microtablet or micropellet.

"After considering the evidence and arguments, we are not persuaded that petitioner has shown sufficiently that a person of ordinary skill in the art would have had a reason to combine Nieboer and Kolter with a reasonable expectation of success of controlling the release rate of DMFAE and ensuring the drug is distributed throughout the digestive tract.

"In particular, we find that petitioner has not explained sufficiently why a person of ordinary skill in the art would have modified Nieboer’s pharmaceutical
preparation with Kolter’s microtablets to solve the gastrointestinal problems
observed in Nieboer."

-—To reach the reporter responsible for this story please contact Dan Lonkevich at 707 318-7899 or at