What Happens When One Deceives the Patent Office to Obtain a Patent?

In the U.S., an applicant for patent has a duty to disclose to the U.S. Patent and Trademark Office (USPTO) all information known to the applicant as being material to the patentability of the claimed invention. When an applicant intentionally fails to disclose such information to the Patent Office and the deceit goes undetected until the patent issues, the patent can later be challenged and be rendered invalid and, thus, unenforceable.

This is precisely what occurred in Belcher Pharmaceuticals, LLC, v. Hospira, Inc., a case recently decided by the U.S. Court of Appeals for the Federal Circuit. The Federal Circuit opined that Belcher Pharmaceuticals obtained its patent by engaging in inequitable conduct during the examination of the patent application. For this reason, the court adjudicated Belcher’s patent as unenforceable.

Belcher Pharmaceuticals desired to manufacture and sell a liquid drug containing epinephrine (also known as adrenaline). Belcher first filed a new drug application with the Food and Drug Administration (FDA) in order to have the drug approved for sale. The FDA granted the new drug application. Belcher then filed a patent application seeking to patent the drug. The patent application was granted as well, issuing as U.S. Patent No. 9,283,197 (the “’197 Patent”).

Hospira, Inc., a competitor of Belcher, desired to sell syringes pre-filled with a similar liquid drug containing epinephrine. Belcher found out and filed suit, alleging that the liquid drug contained in Hospira’s syringes infringes the ’197 Patent.

Hospira responded by seeking to render the ’197 Patent unenforceable due to inequitable conduct. Specifically, Hospira argued that Belcher intentionally failed to disclose to the USPTO relevant prior art references that were in Belcher’s possession during the examination of the patent application. Hospira also exposed Belcher’s inconsistent position for the same drug before the FDA and the USPTO.

By way of background, liquid epinephrine is a well-known drug. It has been on the market since around 1938. The issue with this drug is that it has a tendency to degrade naturally over time. In an effort to reduce the rate of degradation as much as possible, the drug is manufactured to have a pH in a range of about 2.2 to 5.0.

In the FDA application, Belcher disclosed that maintaining the pH of the liquid drug in the range of 2.8 to 3.3 is “old”, but changing it to the range of 2.4 to 2.6 was deemed “new” (according to Belcher). “Old” specifically related to the pH of a similar drug manufactured by/for a Swiss entity named Sintetica SA, which had been in the market for a considerable amount of time. Importantly, the Sintetica drug was deemed stable.

In seeking to have its drug approved for sale in the U.S., Belcher stated to the FDA that the significance of changing the pH level of the drug from the old range of 2.8 to 3.3 to the new range of 2.4 to 2.6 was minor. For this reason, Belcher argued that its manufacturing method (with a pH range of 2.4 to 2.6) did not necessitate any additional testing to establish that its drug was stable due to the already proven stability of the similar Sintetica drug.

The FDA was unpersuaded and requested that Belcher conduct tests to prove that its drug was as stable as Sintetica’s. In an effort to expedite the new drug application before the FDA (and to avoid testing the degradation of its drug altogether), Belcher agreed to manufacture its drug with a pH range of 2.8 to 3.3 in order to take advantage of the well-established low degradation rate of the Sintetica drug.

Belcher then filed a patent application before the USPTO for the same drug as that approved by the FDA. In the patent application, Belcher emphasized that by “increasing the in-process pH to 2.8 to 3.3 [this] unexpectedly reduced the [degradation of the drug] by approximately two-thirds….”

Belcher did not provide the data on the Sintetica drug to the USPTO. In addition, Belcher learned of a substantially similar liquid drug produced by a company named JHP either prior to the filing date of the patent application or while the application was pending. The label in the JHP product described the drug as having a pH in the range of 2.2 to 5.0. Belcher then acquired several batches of the JHP drug and sent them to Sintetica for testing. The test results indicated that the JHP product had a pH in the range of 2.8 to 3.3 (the same as Belcher’s drug). Belcher withheld this information from the USPTO as well.

During the prosecution of Belcher’s patent application, the Examiner issued a rejection to the claims based on a prior art reference that the Examiner uncovered herself (the “Helenek” reference). Helenek taught substantially the same liquid drug as Belcher with the drug having a pH in the range of 2.2 to 5.0. In an attempt to overcome this rejection, Belcher argued that its narrow pH range of 2.8 to 3.3 was patentably distinct over Helenek because a pH in the range of 2.8 to 3.3 resulted in a drug that degrades much slower than expected.

In Belcher’s terms, the pH range of 2.8 to 3.3 was “critical” to its “invention.” The patent Examiner held an interview with Belcher to discuss the alleged criticality of this pH range. As a result of the interview, the Examiner was persuaded by Belcher’s argument and passed the application to allowance (resulting in the ’197 Patent).

In court, Belcher defended itself for withholding the JHP product (and its test results) from the USPTO by arguing that the JHP product was cumulative of Helenek’s disclosure. However, Belcher was under an obligation to report the JHP product to the USPTO regardless of the existence of Helenek. To this point, Belcher should have disclosed the JHP product to the USPTO before the Examiner conducted her own prior art search (which resulted in uncovering Helenek).

Secondly, the JHP drug was very similar to Belcher’s drug. Both drugs even had the same pH range, a range which Belcher argued as being “critical” to its alleged invention. Since the JHP product existed before Belcher filed its patent application, disclosure of the JHP product to the USPTO would have almost certainly caused Belcher’s patent application to be rejected. Therefore, Belcher’s concealment of this product can only be interpreted as a deliberate attempt to fraudulently obtain a patent for a drug that already existed.

The court also opined that Belcher’s argument to the USPTO that a pH in the range of 2.8 to 3.3 was “critical” to its invention was “false” and “fictional” in light of Belcher’s earlier statement to the FDA that such range was “old.” The reason Belcher elected to proceed with a pH in the range of 2.8 to 3.3 before the FDA was to rely on the well-established stability of an existing drug that had the same pH range. Therefore, Belcher’s statement to the USPTO about the “criticality” of the old pH range is deceptive at the very least.

In conclusion, Belcher concealed the existence of virtually the same product that it was seeking to patent and presented false arguments to overcome a strong prior art reference. For these reasons, the court held the ’197 Patent as unenforceable due to inequitable conduct.

Based on the Belcher case, it becomes clear that the duty of disclosure must be taken seriously. Therefore, we would strongly encourage all applicants for patents to consult with an experienced patent attorney to ensure compliance with this rule as well as with other rules that apply to dealings with the USPTO. This way, an applicant can have more faith in the validity of its patent when it eventually issues.