In Medytox, Inc. v. Galderma S.A. No. 2022-1165, __ F.4th ____ (Fed. Cir. June 27, 2023), the case addresses: (i) whether Medytox’s proposed substitute claims introduce new matter, and satisfy the written description and enablement requirements and (ii) whether “the Board’s revision of its claim construction [position]. . . made between a preliminary guidance and a final written decision (“FWD”) violates the Administrative Procedure Act (“APA”).”
Background
The patent-at-issue relates to the “use of an animal-protein-free botulinum toxin composition that exhibits a longer lasting effect in patient compared to an animal protein-containing botulinum toxin comparison.” Galderma challenged the patent-at-issue through a post-grant review. In response, patentee Medytox filed a motion to the Board to cancel claims of the patent-at-issue and substitute with new claims and requested “the Board to issue a preliminary guidance in accordance with the pilot program concerning the motion to amend practice and procedures.” The Board issued a preliminary guidance that the proposed substitute claims do not introduce new matter based on its construction of the limitations “responder rate at 16 weeks after the first treatment of 50% or greater” to mean “simply 50% or greater,” not “range of 50-100%.” The Board concluded the substitute claims do not introduce new matter because the specification discloses responder rates higher than 50%.
The Board later revised its claim construction from “simply 50% or greater” to “range of 50-100%” in its FWD. And the Board concluded based on this construction, the substitute claims do introduce new matter because “the specification only disclosed responder rates of up to 62%.” Further, the Board found that even if the proposed substitute claims do not introduce new matter, the claims should not be permitted because the substitute claims are unpatentable as they lack written description and are not enabled after considering the Wands factors—“a skilled artisan would not have been able to achieve [] responder rates [higher than 62%] . . . without undue experimentation.” Based on these grounds, the Board denied Medytox’s motion to amend substitute claims. Medytox appealed this decision.
Issues
- Whether the proposed substitute claims introduce new matter.
- Whether the proposed substitute claims satisfy the written description and enablement requirements.
- Whether the Board’s decision to revise its claim construction position between a preliminary guidance issued through its Pilot Program concerning motion to amend practice and a FWD violates the APA.
- Whether the Board’s preliminary guidance issued through its Pilot Program concerning motion to amend practice is binding.
- Whether the decision to revise its claim construction position was arbitrary and capricious.
- Whether the Board’s lack of notice to revise its claim construction prevented Medytox from a full and fair opportunity to litigate the case.
Holdings
The Federal Circuit reviews the Board’s legal conclusions de novo and its factual findings for substantial evidence. In particular, “[w]hether a claim amendment satisfies the written description requirement or improperly adds new matter are both questions of fact reviewed for substantial evidence.” Claim construction and whether a claim is enabled are issues of law that may involve underlying factual findings. Based on this standard of review, the Federal Circuit held that Medytox’s proposed substitute claims introduce new matter and did not satisfy the written description and enablement requirements. The panel concluded that the Board’s did not violate the APA. Accordingly, the Federal Circuit affirmed the Board’s decision.
Reasonings
- The Federal Circuit found substantial evidence supports the Board’s FWD that the proposed substitute claims introduce new matter. Although the Board initially opined in its preliminary guidance that the substitute claim limitations “responder rate at 16 weeks after the first treatment of 50% or greater” do not introduce new matter, it later revised the opinion in its FWD that the proposed substitute claims do introduce new matter. The Board’s decision to revise its claim construction position was based on its findings that “responder rate” should be construed to mean “50-100%” and “the specification only disclosed responder rates of up to 62%.” The Federal Circuit found these grounds are substantial evidence sufficient to support the Board’s FWD. Accordingly, the Federal Circuit affirmed the Board’s FWD that the proposed substitute claims introduce new matter.
- The Federal Circuit affirmed the Board’s finding that the proposed substitute claims do not satisfy the written description and enablement requirements. In its FWD, after considering the Wands factors, the Board concluded proposed substitute claims do not satisfy the description and enablement requirements because: (i) Medytox failed to show how to modify the disclosed formulations to achieve the claimed ranges and (ii) the specification disclosed at most 62% responder rate. The Federal Circuit found that these findings are substantial evidence that supports the Board’s FWD that the proposed substitute claims do not satisfy the written description and enablement requirements.
- The Federal Circuit concluded the Board’s decision to revise its initial preliminary guidance opinion did not violate the APA. First, the Board did not violate the APA because Board’s preliminary guidance is “preliminary” and is “non-binding.” Second, the Board did not violate the APA because the Board has authority under In re Magnum Oil Tools Int’l, Ltd. to revise its claim construction position if not arbitrary and capricious. 829 F.3d 1364 (Fed. Cir. 2016). Here, the Board’s decision to revise its claim construction position was not arbitrary and capricious because it was “based on totality of the record.” Id.; see also above. Third, the Board did not violate the APA because Medytox had a full and fair opportunity to litigate the case. The Board “revised the scheduling order for the parties to develop new evidence and arguments” when Galderma filed an opposition to dispute the construction. Also, Medytox had an opportunity to challenge the Board’s FWD construction when it filed a Request for Director Review or Panel Rehearing, but decided not to do so. Accordingly, the Federal Circuit concluded the Board did not violate the APA.