Merck & Co. v. Teva Pharmaceuticals (Fed. Cir. 2005) (on petition for rehearing).
Merck & Co. owns the patent on the best-selling drug Fosamax. Teva, a generic manufacturer lost an infringement case at the district court after the court found the patent valid and infringed. In January 2005, the Court of Appeals for the Federal Circuit reversed the district court — vacating the lower court’s finding of validity and infringement.
Merck, with the amicus support of PhRMA, subsequently filed a petition for rehearing en banc. The CAFC has denied that the request, thus maintaining the panel decision.
DISSENT: In a two-page dissent, Judge Lourie, supported by Chief Judge Michel and Judge Newman, argued that the panel decision erroneously concluded that commercial success was not probative to obviousness in this case and by linking commercial success with the failure of others.
Commercial success is a fact question, and, once it is established, as found here by the trial court, the only other question is whether the success is attributable to the claimed invention (“nexus”), rather than to other factors such as market power, advertising, demand for all products of a given type, a rising economy that “lifts all boats,” etc. It is not negatived by any inability of others to test various formulations because of the existence of another patent. Success is success. The panel’s rule is especially unsound in the context of an improvement patent, as here, because it holds in effect that commercial success for an improvement is irrelevant when a prior patent dominates the basic invention.
Commercial success is also independent of any “failure of others,” as that is another, separate secondary consideration.
Respectfully, the full court should have reheard the appeal to eliminate the confusion in the law that the panel opinion creates.
Interestingly, Judge Rader dissented in the three-judge panel opinion, but now agrees with the majority that the case should not be reheard.
The case will be remanded to the district court on April 28, 2005.
A REUTERS article indicates that Merck & Co. plans to petition the Supreme Court to hear an appeal from the CAFC decision.