Salix Pharms., Ltd. v. Norwich Pharms. Inc.

Case Name: Salix Pharms., Ltd. v. Norwich Pharms. Inc., No. 2022-2153, 2023-1952, 2024 WL 1561195 (Fed. Cir. Apr. 11, 2024) (Circuit Judges Lourie, Chen, and Cunningham presiding; Opinion by Lourie, J.; Dissenting-in-part Opinion by Cunningham, J.) (Appeal from D. Del., Andrews. J.)

Drug Product and Patent(s)-in-Suit: Xifaxan® (rifaximin); U.S. Patents Nos. 8,309,569 (“the ’569 patent”), 10,765,667 (“the ’667 patent”), 7,612,199 (“the ’199 patent”), 7,902,206 (“the ’206 patent”), 8,624,573 (“the ’573 patent”), 9,421,195 (“the ’195 patent”), and 10,335,397 (“the ’397 patent”)

Nature of the Case and Issue(s) Presented: Rifaximin, the active ingredient in Xifaxan, was first synthesized in the early 1980s in Italy and approved there as an antibiotic in 1985. The FDA approved Xifaxan nearly 20 years later, in 2004, as 200 mg tablets for the treatment of travelers’ diarrhea. The FDA subsequently approved 550 mg tablets for hepatic encephalopathy (“HE”) in 2010 and for irritable bowel syndrome with diarrhea (“IBS-D”) in 2015. Norwich sought to market a generic version of rifaximin, filed an ANDA for 550 mg tablets with the same indications as Xifaxan, and certified that the Orange Book-listed patents were invalid. Salix sued and the patents-in-suit had been narrowed for purposes of trial into the following categories: (i) the ’573, ’195, and ’397 patents, directed to treating HE (“the HE patents”); (ii) the ’569 and ’667 patents, directed to treating IBS-D with 550 mg rifaximin three times a day (1,650 mg/day) for 14 days (“the IBS-D patents”); and (iii) the ’199 and ’206 patents, directed to rifaximin form β (“the polymorph patents”).

Following a bench trial, the district court held that the HE patents were valid and infringed—a ruling that Norwich did not appeal—and that the IBS-D and polymorph patents were infringed but invalid as obvious. Salix appealed those invalidity holdings. After the district court’s decision, Norwich amended its ANDA to carve out the HE infringing indication and moved to modify the judgment under Fed. R. Civ. P. 60(b). The district court denied Norwich’s motion and Norwich cross appealed.

Why Salix Prevailed: While the Federal Circuit affirmed the invalidity of Salix’s polymorph and IBS-D patents, it also affirmed the denial of Norwich’s Rule 60 motion thereby preventing Norwich from launching its generic product until the HE patents expire in 2029.

The IBS-D patents. The IBS-D patents claim treating IBS-D with 550 mg rifaximin, thrice-daily (1,650 mg/day), for 14 days. In support of its obviousness argument, Norwich principally relied on a clinical trial protocol that described a Phase II study evaluating twice-daily doses of 550 mg (1,100 mg/day) and 1,100 mg (2,200 mg/day) for 14 and 28 days for the treatment of IBS-D (“the Protocol”) and a 2006 journal article that taught administering 400 mg, TID (1,200 mg/day), for the treatment of IBS, but further opines that the “optimal dosage of rifaximin may, in fact, be higher than that used in our study” (“Pimentel”). The district court found that a skilled artisan would have been motivated to combine those two references to arrive at what is claimed with a reasonable expectation of success. On appeal, Salix argued that there was insufficient evidence to support a finding of a reasonable expectation of success in using the particular claimed dosage amount. The Federal Circuit disagreed. “The combined message that the skilled artisan would have discerned from the Protocol and Pimentel is that the optimal dosage for treating patients suffering from IBS disorders may be higher than 400 mg [three times per day], and the next higher dosage unit from the Protocol was 550 mg.” Moreover, references establishing the background knowledge of a skilled artisan were consistent with the reasonable expectation of success provided by the combination of the Protocol with Pimentel.

The polymorph patents. The polymorph patents claim rifaximin form β. The district court relied principally on the Cannata prior art reference in finding the polymorph patents obvious. Cannata disclosed that rifaximin exists in crystalline form with “outstanding antibacterial properties.” While it does not discuss rifaximin’s crystal structure in detail, it does disclose several preparation protocols for rifaximin that include solvents used for crystallization. The district court found that: (i) a skilled artisan would have had good reason to characterize the crystalline rifaximin obtained by following the Cannata protocols; (ii) that such characterization was routine and could have been performed “in one day;” and (iii) that doing so would have led the skilled artisan to have “detected rifaximin β.” Salix first challenged the district court’s approach by citing to Federal Circuit jurisprudence that it believed compelled the opposite result. But the Federal Circuit found that the district court acted within its discretion when it declined to follow those decisions as thought they were binding precedent. Polymorph and crystalline form patent cases include distinctively and highly factual records and the outcome in one does not compel the same outcome in another. Moreover, rifaximin was a known compound with a known, useful activity. The district court found that polymorph β is a commonly produced polymorph and the most stable form of rifaximin, which Salix did not dispute. Indeed, Salix had done no more than combine known elements of the prior art to verify readily accessible information concerning a compound already in the hands of skilled artisans, and such routine efforts do not justify removing this polymorph from the public domain.

Norwich’s cross appeal. Norwich raised two arguments on appeal: (i) the district court misinterpreted 35 U.S.C. § 271(e)(4)(A), which, according to Norwich, precludes delaying final approval of an entire ANDA, and instead required delaying only the approval of the infringing use; and (ii) the district court erred in denying Norwich’s Rule 60 motion. With respect to Norwich’s first argument, Norwich’s ANDA originally sought approval for the treatment of both IBS-D and HE. Although only the HE indication was found to infringe a valid patent, the district court’s final judgment restricted FDA from issuing final approval of the entire ANDA, including the non-infringing indication, until 2029. “The statutory scheme makes clear that it is not the potential use of Norwich’s rifaximin for HE that constitutes the relevant infringement here, nor is it the unpatented drug compound itself, but rather it is the submission of the ANDA that included an infringing use. … That the ANDA further recited a non-patent-protected indication does not negate the infringement resulting from the ANDA’s submission.” Therefore, the district court’s order appropriately delayed the effective final approval date of “this infringing ANDA” submission. With respect to Norwich’s second argument, “a district court has the discretion, not the obligation, to modify a final judgment in view of a post-judgment ANDA amendment. And as the district court held, simply asserting that a patented indication has been carved out of an ANDA application does not necessarily satisfy the judgment or entitle the applicant to direct entry to the market.” The Federal Circuit saw no abuse of discretion in this conclusion.