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Federal Circuit Interprets “On-Sale Bar”

Federal Circuit
Says SEC disclosures
Trigger On-Sale Bar

The Federal Circuit has ruled that the on-sale bar rule of 35 U.S.C. § 102 applies to sales of products made available to the public even if what’s offered doesn’t fully disclose the invention.

The case of Helsinn v. Teva involves four Helsinn patents for intravenous formulations of a drug called palonosetron for reducing or reducing the likelihood of chemotherapy-induced nausea and vomiting (CINV).

Helsinn sued Teva alleging that Teva’s filing of an Abbreviated New Drug Application (ANDA) constituted an infringement of various claims of those patents.

Teva countered that the claims were invalid under the on-sale bar rules.

Three of the patents at issue pre-dated the America Invents Act (AIA) and one was issued after it was enacted.

In 2001, almost two years before Helsinn applied for one of its patents, Helsinn and another company entered into two agreements relating to products to be made under the future patent: a license agreement and a supply and purchase agreement.

The agreements were announced in a joint press release and in the other company’s Form 8-K filing with the Securities and Exchange Commission (SEC).

Under the terms of the license, the other company agreed to pay Helsinn $11 million plus future royalties on distribution of “products.” The products at issue were specific doses of palonosetron.

However, the SEC filing and press release did not reveal the price and dosing level.

Helsinn then filed three patent applications from 2005 to 2006 and a fourth in 2013, all covering a 0.25 mg dose.

In 2015, Teva filed its ANDA seeking FDA approval to market a generic 0.25 mg palonosetron product.

35 U.S.C. § 102  provides that

A person shall be entitled to a patent unless— (1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public [more than one year] before the effective filing date of the claimed invention…

The court concluded that the announcement of the sale created prior art, even without the dosing details.

This is an important development that will lead to a change in Patent Office practices.

There can be no real dispute that an agreement contracting for the sale of the claimed invention contingent on regulatory approval is still a commercial sale as the commercial community would understand that term.

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