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IN THE UNTED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWAR

GLAXO GROUP LIMITED )

v. )

Plaintiff, )
) )

Civil Action No. 04-171-KA
)

TEV A PHACEUTICALS USA, INe. and ) TEV A PHARCEUTICAL INUSTRIS )

LIMITED )) Defendants.
)

CONFIDENTIAL FILED UNDER SEAL

TEV A'S BRIEF IN OPPOSITION TO GLAXO'S MOTION FOR SUMMAY JUDGMENT DISMISSING TEV A'S AFFIRMATIVE DEFENSES AN CORRSPONDING COUNTERCLAIM ALLEGING INEQUITABLE CONDUCT DURING THE PROSECUTION OF U.S. PATENT NO. 5.068,249
YOUNG CONA WAY ST ARGATT & TAYLOR, LLP Josy W. Ingersoll (# 1088) Adam W. Poff (# 3990) Karen E. Keller (# 4489) The Brandywine Building 1000 West Street, l7th Floor P.O. Box 391 Wilmington, DE 19899 Telephone: (302) 571-6600

kkeller(fycst.com

\

MERCHA & GOULD P.e.
Mark D. Schuman Ronald A. Daignault Jeffer Ali Jeffey C. Brown 3200 IDS Center 80 South 8th Street Minneapolis, MN 55402
Teva Pharmaceuticals USA, Inc. and Teva Pharmaceutical Industries, Ltd.

Dated: July 28, 2006

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TABLE OF CONTENTS

1. STATEMENT OF THE NATUR AN STAGE OF
THE PROCEEDING ............... ................................. ..................................... ...... ....l

II. SUMY OF THE ARGUMENT........................... ............. ........... ...................l
III. STATEMENT OF THE FACTS.... ..... ............... ................ .....................................3

A. Introduction.................................................................................................. 3
B. The Prosecution History.. ............. ...................... ......... ............. ............... ....4

C. The Withheld Information............ ................ ...... ............................... ..........9

iv. ARGUMENT... ................................ ......................... .............................................10
A. The Glaxo v. Pharmadyne Opinion Does Not And Should

Not Preclude Teva From Presenting Its Own Evidence Of
Glaxo's Inequitable Conduct. . . . . . . . . . . .. . .................... ............... ...............10
B. The Standard For Inequitable Conduct In This Case Is Whether The

Examiner Would Have Considered The Information Glaxo Omitted Important. ................................................................................................. .12
e. Triable Issues Of

Fact Exist On Materiality And Intent To Deceive By Glaxo's Failure To Submit All OfIts Stability Data. ..............................13 Fact Exist On Materiality And Intent To Deceive By Glaxo's Failure To Submit The TagametCI/Ethanol Prior Ar. .......... ................................ ................. ..................................... .16

D. Triable Issues Of

V. CONCLUSION........... ........... .......... .................. ........ ........................... .............. .20

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TABLE OF AUTHORITIES

FEDERA CASES
Blonder-Tongue Lab. v. University of Ilinois Found., 402 U.S. 313 (1971) ..................................................................................... ................... .11
Brasseler, U.S.A. I, L.P. v. Stryker Sales Corp.,

267 F.3d 1370 (Fed. Cir. 2001)....... ....................................................... ............. ........... ....2

Bristol-Myers Squibb Co. v. Rhone-Poulenc Rorer, Inc., 326 F.3d l226 (Fed. Cir. 2003)....................................................................................4, 12

Critkon, Inc. v. Becton Dickinson Vascular Access, 120 F.3d 1253 (Fed. Cir. 1997)... .......... .............................................................................2

Digital Control, Inc. v. Charles Mach. Works, 437 F .3d 1309 (Fed. Cir. 2006)....... ................... ........................................................ ......12
Glaxo v. Pharmadyne,

32 F. Supp. 2d. 265 (D. Md. 1998).........................................................................passim
JP. Stevens & Co. v. Lex Tex, Ltd.,
747 F .2d 1553 (Fed. Cir. 1984)..... ........................................ ..... ............... .......... ............ .l2

Molins PLC v. Textron, Inc., 48 F.3d 1172 (Fed. Cir. 1995)..................................................................................1, 2, l2
Purdue Pliarma L.P. v. Endo Pharm., Inc.,

438 F.3d 1123 (Fed. Cir. 2006)..........................................................................................l
Rolim & Haas Co. v. Brotech Corp.,

127 F.3d 1089 (Fed. Cir. 1997) .......................................................................................19
Russell v. Place,

94 U.S. 606 (1876) .......... ................................. .......... ................ .............................. ........1 0
Sharp Kabushiki Kaisha v. Thinkshmp, Inc.,

448 F.3d 1368 (Fed. Cir. 2006)........................................................................................11
Warner-Lambert Co. v. Teva Pharmaceuticals USA,

289 F. Supp. 2d 515 (D .NJ. 2003) ........ ...... .......... .......................... .............................. ..l2
Warner-Lambert Co. v. Teva Pharms. USA, Inc.,

418 F.3d 1326 (Fed. Cir. 2005)........................................................................................19

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FEDERA STATUTES
37 CFR § 1.56 ........ ... . . . .... ... . . . . . . ......... . . .. . .. . ... . .. .. . . . . . .. . .. .... . . . . . . ........ . . . ..... ..... .. . . . . ... . ...... .4, l2

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i. STATEMENT OF

THE NATURE AND STAGE OF THE PROCEEDING

This lawsuit was fied after Defendant Teva Pharmaceuticals USA, Inc. ("Teva")
filed an Abbreviated New Drug Application ("ANDA") for an oral ranitidine solution
allegedly covered by U.S. Patent No. 5,068,249 ("the '249 patent"), which is owned by

Plaintiff Glaxo Group Ltd. ("Glaxo"). The patent claims the use of ethanol to increase
the stability ofranitidine in an oral solution. ('249 pat., co!. 3, lines 1-4 (G000227-229)).1

After the close of factual and expert discovery, both parties filed motions and supporting

briefs for summary judgment of infrngement/non-infrngement and claim construction in
accordance with the Court's Second Amended Scheduling Order of

May 22,2006. (D.I.

No. 92). Glaxo also filed this motion, in which it seeks summary judgment and dismissal
ofTeva's affirmative defense and counterclaim that the '249 patent is unenforceable due

to Glaxo's inequitable conduct before the U.S. Patent and Trademark Offce ("Patent
Office"). (D.l. No. 96). Teva fies this brief

in opposition to Glaxo's motion for

summary judgment to dismiss Teva's affirmative defense and counterclaim.

II. SUMMARY OF THE ARGUMENT
Applicants for patents have a duty to prosecute patents in the Patent Office with
candor and good faith, including a duty to disclose information known to be material to
patentabilty. Purdue Plianna L.P. v. Endo Pharm., Inc., 438 F.3d 1123, 1128-29 (Fed.

Cir. 2006). This duty extends to every person involved in the prosecution of

the patent.

See Molins PLC v. Textron, Inc., 48 F.3d 1172, 1178 n.6 (Fed. Cir. 1995) ("The duty to

i File history documents, referenced herein within the range GOOO 1 II through G000308, are

attched as Exhibits 2 and 3 to the Joint Claim Constrction Statement fied on June 30, 2006
(D.L Nos. l06-l07).

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disclose information material to patentability rests on the inventor, on each attorney or
agent who prepares or prosecutes an application and on every other individual who is the application and who is
substantively involved in the preparation or prosecution of

associated with the inventor, with the assignee, or with anyone to whom there is an
obligation to assign the application.") A breach of

this duty constitutes inequitable

conduct. Id. at 1178. Inequitable conduct includes affirmative misrepresentations of a

material fact, failures to disclose material information, or submissions of false material

information. Id. An intent to deceive or mislead the Patent Offce is also required to
breach the duty. Id. Those charged with this duty must have complete candor, good faith

and honesty with the Patent Office. Id. When there is doubt about the materiality of any
information, that doubt should be resolved in favor of disclosure. Brasseler, U.S.A. 1.,

L.P. v. Stryker Sales C01p., 267 F.3d 1370, 1380 (Fed. Cir. 2001) (citing Critkon, Inc. v.
Becton Dickinson Vascular Access, 120 F.3d 1253, 1257 (Fed. Cir. 1997)).

During its prosecution of the '249 patent application, Glaxo failed to disclose at
least two pieces of

material information to the Patent Offce. First, Glaxo's Dr.

Hempenstall did not submit all of the data it had on the stability of ranitidine in the
presence of ethanoL. Hempenstall's intentional submission of

incomplete data was what

convinced the Examiner to allow the patent. Some of the withheld data showed that
ethanol did not improve the stability of ranitidine to a statistically signficant degree.

This was directly contrar to what was being argued to the Examiner. Second, the
inventor, Dr. Long, did not disclose a related, TagametCI formulation containing ethanoL.

Glaxo was aware of this formulation, and it was much more material than the references

cited to or by the Examiner. In fact, it was the only prior ar that showed an H2 blocker

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in an oral solution with ethanol that was commercially available and therefore,
presumably stable. These two omissions served to limit the Examiner's evaluation of

the

'249 patent application and, together with other evidence in this case, create a strong
inference that Glaxo intended to deceive the Patent Office.

At the very least, there are factual issues in dispute, and this Court should
determine at tral whether Glaxo' s omission of information was material and intentional,

constituting inequitable conduct that renders the '249 patent unenforceable. Moreover, Glaxo offers no compe1lng reason why this Court should adopt the legal conclusions of
the court in the Pliarmadyni case and deprive Teva of

its constitutional right to a trial on

the different parties, facts and evidence presented in this case.
III. STATEMENT OF

THE FACTS

A. Introduction

Glaxo alleges that Teva's proposed, generic raniÜdine oral syrp formulation
infrnges Glaxo' s '249 patent under the doctrne of equivalents. The '249 patent is

entitled "AQUEOUS RATIDIN COMPOSITIONS STABILIZED WITH
ETHAOL." The critical difference between the patented composition and Teva's
proposed formulation is that Teva's formulation uses
formulation uses ethanoL3

while the patented

Redacted

The cornerstone of Glaxo's patent is the limitation - "a stabilizing effective

amount of ethanoL" (CoL 3, line 3). That patentable distinction was not easily obtained,
however, and incorporates Glaxo and the Examiner's understanding that such an amount
232 F. Supp. 2d 265 (D. Md. 1998).
3 Teva also uses different amounts of most of

the other excipients and

versus lO % (Glaxo). (D.I. No. l05, Exhibit 1 to Teva's Opening Brief Motion For Summary Judgment of

in Support of Non-Infringement at A004, Anderson Report, March l6,

2006, ii 52) (emphasis added).

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of ethanol must necessarly be "demonstrated. . . by . . .experimental data to show a

definite improvement over the (prior ar)." (G000200). The Examiner repeatedly and
consistently rejected the application as an obvious variant over the prior art. To
overcome the rejections, Glaxo ultimately was forced to submit a declaration attesting to

ethanol's "surprising" and "significant" ability to enhance "the stability ofrantidine."
(G000209, ~ 5). That declaration, however, was misleading and incomplete; it contained

cherr-picked data that served to support Glaxo's claims of substantially enhanced
ranitidine stability with ethanol while excluding data to the contrar.
B. The Prosecution History

Glaxo began prosecuting the '249 patent on December 11, 1987, as Application

No. 07/131,442 ("the '442 application"). (G000237-238). Afer it filed the '442
application with the Patent Offce, but prior to the first examination on the merits, Glaxo
submitted an "Information Disclosure Statement" with "the following information, which
may be considered material to the prosecution of

the ('442) application:" (1) U.S. Pat.
its

No. 4,128,658,4 (2) U.S. Pat. No. 4,585,790,5 and (3) a publication by one of

scientists, John Padfield, titled, "The Chemical Use ofRanitidine." (G000258-261).6

4 The '658 patent, entitled "AMINO

ALKYL FUR DERI ATNES," is equivalent to "British

Patent Specification No. l,565,966," which is disclosed in the specification. The '966 patent makes a passing reference to "an oral syrp" ofranitidine, but otherwse does not teach or claim its manufacture. (G000258, G000254, lines 4-l0). 5 The '790 patent, entitled "PHACEUTICAL COMPOSITIONS," teaches an aqueous life" at "a pH in the range 6.5-7.5." ('249 patent formulation ofranitidine with "enhanced shelf
6 An Information Disclosure Statement ("IDS") is used by patent applicants, and individuals
(Abstract)). It is the U.S. equivalent of

U.K. patent GB 2,l42,820 to Padfield ("the '820 patent").

associated with the patent application, to fulfill their "duty to disclose information material to patentability" pursuant to 37 CPR § l.56. The mere fiing of an IDS, however, does not
automatically mean that the duty has been met. See Bristol-Myers Squibb Co. v. RJione-Poulenc Rorer, Inc., 326 FJd 1226, 1242 (Fed. Cir. 2003) (inequitable conduct and unenforceability

found upon untimely submission of material prior art).

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The Examiner, however, never considered this prior art during the prosecution of
the '442 application. Instead, he rejected the pending claims of

the application for

obviousness based on two Chemical Abstracts references, which the Examiner had found
on his own and entered into the file history.7
The Examiner's first Office Action on the '442 application rejected all of

the

claims of

the application because the Chemical Abstracts taught, "the conjoining of

ranitidine and an alcohol, e.g. ethanoL" (G000265). In response, Glaxo argued, "the art
does not teach the cojoining ofranitidine and ethanol in a pharmaceutical composition."
(G000268) (emphasis added).
Glaxo argued that Chemical Abstracts 97: 61014g (1982) "relates to the Glaxo

patent for a new polymorphic form ofranitidine hydrochloride (designated form 2) and
includes a description of

processes for its production." (G000269).

Glaxo argued that Chemical Abstracts 104: 102280z (1986) "relates to a paper in
a Scandinavian journal indicating the presence of ethanol in a person's diet did not
adversely affect the gastric acid secretion inhibiting properties ofranitidine." (Id.)

On the second Office Action, the Examiner maintained his rejections to all claims

"over Chemical Abstract (both) under 35 USC 103" for the same reasons stated in the

first Office Action. (G000272). The Examiner made his second rejection finaL. Id. In
lieu of

responding, Glaxo abandoned the '442 application on July 3, 1989. (G000275).
Glaxo filed its second application on April

28, 1989, as Application No.

07/344,620 ("the '620 application"). On his own accord, the Examiner entered into the
record of

the '620 application the Chemical Abstracts references that he had found during

7 Chemical Abstracts is a publication of Chemical Abstracts Servce, which is a division of the

American Chemical Society. Chemical Abstracts contains abstracts of patents and articles published in major scientific journals.
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the examination of

the '442 application. (GOOOl33). Glaxo did not resubmit the '658

and '790 patents or the Padfield aricle as "material" prior art. Instead, Glaxo submitted

U.K. Patent Application 2,120,938A, entitled "ANTI-ULCER PHACEUTICAL
COMPOSITIONS CONTAIG SALICYLIC ACID OR ITS SALTS." The '938
application teaches the experimental use ofrantidine or cimetidine8 in the treatment of
ethanol-induced gastric lesions in rats. (G000147, G000150, lines 52-57) (emphasis

added).
On the first Offce Action of the '620 application, the Examiner rejected all of

the

claims as obvious in view of Chemical Abstracts ("the art teaches the cojoined use or use

(sic) ofranitidine and an alcohol (ethanol)"). (G000132). Glaxo argued in response, "the

art does not teach the cojoining ofrantidine and an alcohol in a pharaceutical
composition which is an aqueous formulation for oral administration." (G000141)
(emphasis added). Glaxo further argued that Chemical Abstracts did not teach that

"ethanol" could "enhance. . . the stability ofranitidine." (G000142).
the claims of The Examiner was not persuaded and again rejected all of

the '620

application as obvious over the Chemical Abstracts references. The Examiner stated that,
"(a)s for the allegation of enhanced stability, it has not been demonstrated for the
compositions urged as contrasted with any of other pH parameters.,,9 (GOOOl61). The
Examiner made this rejection finaL.

8 Cimetidine is TagametCI. Phariiadyne at 301.

9 Although the basis for the Examiner's comment is unclear, the Examiner might have been

referrng to the pH parameters listed in the application or the '820 Padfield patent (or its U.S. equivalent, the '790 patent). (GOOOl9l, lines 57-60; G000285 (Abstract)). Glaxo had already received a patent on the use of pH to stabilize ranitidine, and this information had been disclosed to the Examiner, but not considered, in the previous '442 application. (G000258-26l).

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In response to the final rejection of all claims of

the '620 application, Glaxo fied

a "Request for Filing File Wrapper Continuation Application Under 37 C.F.R. 1.62" on

March l4, 1990. This allowed Glaxo to continue prosecuting the application under a new
Application number, 07/494,804 ("the '804 application"). On May 4, 1990, the
Examiner again rejected "all" of the claims of the application as obvious in view of

the

same Chemical Abstracts. (G000141).

Glaxo responded to the May 1990 Office Action with the same arguments as

before. Namely, that Chemical Abstracts did not teach the enhanced stability of
ranitidine in an aqueous oral formulation by the addition of ethanoL. (GOOO l75-176).

Glaxo represented that it would submit "a Declaration to substantiate the unexpected

effect of ethanol in enhancing the stability ofraritidine in aqueous oral formulations."
(GOOOl77) (emphasis added). Glaxo also submitted patent GB 2,142,820A and its
French equivalent, Pub. No. 2,547,727. (GOOOI77, ~ 3).

The '820 patent, entitled "AQUEOUS COMPOSITIONS OF RATIDIN," and

its French equivalent, "PHACEUTICAL COMPOSITIONS," teach aqueous-based
oral formulations containing ranitidine that have enhanced shelf life within a narow pH

range of6.5-7.5. (G000192, lines 19-21; 58-59). Glaxo also mentioned "French
application 2,501,206" in its response. (GOOOl77, ~ 4). Glaxo stated that the '206

application discloses "pharaceutical formulations" of "novel compounds which are
strcturally different than rantidine." (Id.) Glaxo, however, did not submit the '206

application to the Patent Offce.
The only prior art before the Examiner during the prosecution of

the '249 patent

related to the experimental synthesis ofrantidine using ethanol (Chemical Abstracts 97:

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61014g), the experimental effect of ethanol on ranitidine's ability to inhbit gastric acid

secretion in humans (Chemical Abstracts 104: 102280z), the effect ofranitidine or
cimetidine on ethanol induced lesions in rats (the '938 application), and pharmaceutical

compositions ofranitidine (or cimetidine) without ethanol (the '820 patent and the '938
application).
On January 22, 1991, before Glaxo submitted any declaration to the Patent Office,

the Examiner issued its second Office Action on the' 804 application. The Examiner
stated that Glaxo had overcome the objections made in the May 4, 1990, Offce Action
"by the amendment filed on 10/31/90," but he still rejected all claims as obvious in view
of

the '820 patent. The '820 patent teaches rantidine formulations having enhanced

stability at pH 6.5 to 7.5, the same pH range claimed in the '249 patent. (GOOOl99-200).
In support of

this new rejection, the Examiner stated, "(i)t has not been demonstrated in

the record, by means of experimental data, that the applicant's invention produces any

unexpected results." (G000200). The Examiner also stated that, "(a)bsent evidence to
the contrary, the addition of ethanol is considered merely to be a choice among known

conventional excipients." (Id.)
In direct response to the Examiner's request for data, Glaxo submitted a
declaration of one of its scientists, Dr. Hempenstall, containing experimental data. Dr.
Hempenstall was a Research Leader at Glaxo at the time and is not an inventor of

the

'249 patent. (G000208, ii 1). Dr. Hempenstall's declaration purported to show "a
signficant and surprising enhancement in the stability of

the rantidine . . . by the

addition of ethanol to the formulation." (G000209). To show "a highly signficant and
valuable improvement" in the "the acceptable shelf life for an aqueous formulation

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containing ranitidine hydrochloride," Dr. Hempenstall compared a formulation with 0%

ethanol to one with 7.5% ethanoL. (G0002l0-2l1). Dr. Hempenstall defined "acceptable
shelf life" as "the time (in months) for 5% ranitidine loss calculated as the lower 95%

confidence limit." (G000210). However, the information that Dr. Hempenstall
submitted was incomplete.
C. The Withheld Information

Dr. Hempenstall knowingly submitted incomplete data to the Patent Offce in
order to convince it to allow the '249 patent. The Pharmadyne court expressly found that

Dr. Hempenstall 'excluded unfavorable data.' Pharmadyne at 313. This, alone, creates a
strong inference that Dr. Hempenstall intended to deceive the Patent Office.

Redacted

The inference is further reinforced by the fact that another Glaxo employee, Dr.

Bird, wrote a memo in which she analyzed

and

concluded that the effect of ethanol on the stability of rantidine was

(D.l.

No. 105, Exhibit 12 at A054, G000919). Dr. Hempenstall read Dr. Birds memo
(Exhibit A at B002, Hempenstall

Depo., pp. 205-206).10 Nonetheless, Dr. Hempenstall hid this information from the

Patent Offce and argued with incomplete data that there was a "highly signficant"
improvement in ranitidine stability using ethanoL. (G000211).

There also is evidence that Dr. David Long, the sole inventor of the '249 patent,

intentionally withheld a prior ar TagametCI/ethanol solution from the Patent Office. The
TagametCI/ethanol solution was the only piece of prior ar in which a commercial H2

May l2, 2006, the deposition testimony the paries and this Cour's Order of of Glaxo witnesses Dr. David Long, Dr. John Hempenstall, Dr. John Padfield, Dr. Ian Winterborn, Gilian Amphlett and Nadeem Elahi in the Glaxo v. Pharmadyne case are admissible evidence in this case. (D.L No. 87).
10 By stipulation of

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blocker, such as ranitidine, was combined with ethanol in an oral solution that was

commercially available and, therefore, presumably stable. No art cited by Glaxo or the
Patent Office contained all of

these attbutes. Dr. Long admitted in his deposition in the

Pliarmadyne case that he knew ofthe TagametCI/ethanol solution before the first
i 1 application for the '249 patent was fied.

Redacted
(Exhibit Bat B004, Long Depo. p. 53, lines 14-17). Neither Glaxo nor Dr.
Long ever submitted this piece of

prior ar to the Patent Offce. Yet, none of

the considered prior art taught a commercial H2 blocker in a stable
pharaceutical composition containing ethanoL.

The "unfavorable data" that Hempenstall "excluded" and the
TagametQD/ethanol solution were highly material and not cumulative of any ar

before the Examiner. The evidence, and inferences from the evidence, show
that Glaxo intentionally withheld: (1) all of

the data regarding ethanol's effect

on the stabilty ofranitidine, and (2) the TagametQD/ethanol solution. Genuine
issues of material fact remain, that warrant denial of

Glaxo's motion to dismiss

Teva's inequitable conduct defense and counterclaim.

ii The '249 patent was first filed in the United Kingdom on December l2, 1986. ('249 patent,

cover).
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iv. ARGUMENT
A. The Glaxo v. Pliarmadyiie Opinion Does Not And Should Not Preclude

Teva From Presenting Its Own Evidence Of Glaxo's Inequitable

Conduct.
The public policy underlying the principles of

preclusion, whereby potentially

meritorious defenses may be bared from judicial scrutiny, has led courts to hold that the
circumstances for preclusion "must be certain to every intent." Russell v. Place, 94 u.s.

606, 610 (187 6) (denying preclusion of an invalidity defense in a patent infrngement

case based on plaintiffs prior successful infrngement action against another pary); see
also ShaJp Kabushiki Kaislia v. Thinksharp, Inc., 448 F.3d 1368, 1372 (Fed. Cir. 2006)

("When a party did not have an opportnity to litigate disputed issues, a decision to
permit such litigation is favored.") These cases stand for the proposition that unless absolute identity of issues and
paries exist, issues and evidence decided in one case should not be imputed to a litigant

in a different case. As succinctly stated by the Supreme Court in Blonder-Tongue Lab. v.

University of Illnois Found., 402 U.S. 313, 329-30 (1971):

(T)hose who never appeared in a prior action. . . may not be collaterally estopped without litigating the issue. They have never had a chance to present their evidence and arguents on the claim. Due process prohibits estopping them despite one or more existing adjudications of the identical issue which stand squarely against their position.
(internal citations omitted).

Accordingly, the court's findings and conclusions in the Pliarmadyne case should

not preclude Teva from makng its own arguments and presenting its own evidence on
the materiality and intent of Glaxo's omissions to the Patent Office, even if

the arguments

and evidence are essentially the same.

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The Pharmadyne decision is not binding precedent by this Court or any Court of

Appeals. In addition, the Pharmadyne court's legal conclusions on inequitable conduct
were premised on different evidence. For example, one of

Glaxo's expert witnesses in

Pliarmadyne, Dr. Wray, is now deceased according to Glaxo. He testified about the
chemical and clinical differences between cimetidine ("Tagamet(ß") and ranitidine.

Pliarmadyne at 301. In reliance on his testimony, the Pharmadyne cour concluded that
Pharmadyne had failed to prove that the TagametCI formula in ethanol was material prior

art to the '249 patent. Pharmadyne at 310.
Glaxo and Teva did not stipulate to the admissibility of

Dr. Wray's tral or

deposition testimony. Glaxo's expert, Dr. Anderson, has not opined on the materiality of
the TagametCI prior art. Given the different evidence in this case relating to the
materiality of

the TagametCI reference, Pharmadyne has no bearing on how this Court

decides to weigh these admissible facts at tral.
B. The Standard For Inequitable Conduct In This Case Is Whether The

Examiner Would Have Considered The Information Glaxo Omitted Important.
Because the patent application that led to the issuance of

the '249 patent was filed

prior to 1992, information is deemed material if there is a "substantial

likelihood that a

reasonable examiner would have considered it important in deciding whether to allow the
application to issue as a patent." Warner-Lambert Co. v. Teva Pharmaceuticals USA,

289 F. Supp. 2d 515, 534 (D.NJ. 2003) (citing 37 C.F.R. § 1.56(a) (1987); MolÙis PLC v.

Textron, Inc., 48 F.3d 1172, 1179 n.8 (Fed. Cir. 1995). "Materiality is determined from
the viewpoint of a reasonable patent examiner, and not the subjective beliefs of

the

patentee." Bristol-Myers Squibb Co. v. Rhone-Poulenc Rorer, Inc., 326 F.3d 1226, l238
(Fed. Cir. 2003). "Materiality and intent are factual issues." JP. Stevens & Co. v. Lex
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Tex, Ltd., 747 F.2d l553, 1562 (Fed. Cir. 1984). A false affidavit, standing alone, is

sufficient to render a patent unenforceable. Digital Control, Inc. v. Charles Mach.
Works, 437 F.3d 1309, 1321 (Fed. Cir. 2006). Moreover, in the summary judgment
context, all inferences must be made in favor of

the non-movant. Digital Control, Inc.,

437 F .3d at 1316. Under these standards, there is enough evidence of materiality and
intent to deceive to deny Glaxo's motion.

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C. Triable Issues Of Fact Exist On Materiality And Intent To Deceive By

Glaxo's Failure To Submit All Of Its Stabilty Data.
After repeatedly failng to convince the Examiner that ethanol, as compared to
other "known conventional excipients," had the unique ability to significantly enhance
Dr.
the stabilty ofranitidine, Glaxo finally submitted data in the Declaration of

the rejections
Hempenstall on May 10, 1991, as par of a Request for Reconsideration of

made in January 1991. (G000204, G000208-211). The Patent Office relied on this data,
found it persuasive, and allowed the patent. (G000212).

As it turns out, Dr. Hempenstall did not submit all of Glaxo's stability data to the
Patent Offce. The Pliarmadyne court found that Hempenstall "excluded... unfavorable

Glaxo's stability
data." Pharmadyne at 313. Dr. Hempenstall's failure to submit all of

data, including data that was unfavorable to its claim of enhanced ranitidine stability, led

the Pharmadyne court to find "improper behavior by Glaxo in prosecuting the ('249)
patent." Phamiadyne at 312.12 The Pharmadyne cour was "troubled by G1axo's failure
to present all of

the statistical data to the PTO." Id.

Glaxo's reliance on the Pharmadyne case is curious because it is fatal to its
summar judgment motion. The Pharmadyne court clearly found that all ofG1axo's

experimental data was material, but not disclosed. "There is no question that Glaxo should have provided the Patent Offce with all the experimental data from both the

12 Although Pliarlladyne does not preclude Teva from presenting its case, the finding is
instrctive. It shows an inference that can be drawn from the evidence presented in that case. By

stipulation in this case, most of the tral testimony and exhibits that were before the cour in May 12,2006, D.L No. 87). This Cour Pliarmadyne are admissible before this Court. (Order of
will have to examine the evidence and testimony from the Pharmadyne case to arrve at its own conclusions on inequitable conduct. Interestingly, the Pliarmadyne case was not dismissed on summary judgment. There were real, trable issues and facts to support them. That same evidence is before this Cour and, as in Pharmadyne, creates factual trable issues this Court should determine after viewing all of the evidence.
14
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United Kingdom and United States studies." Id. It also led the court to conclude that
there was intent; "the appearance of improper behavior by Glaxo in prosecuting the
patent, therefore, appears great." Id. Based on these findings alone, there is a factual
issue regarding the materiality of

the withheld data and the intent to withhold it.

Intent also can be inferred from other evidence in the case, and this creates a
factual issue that precludes summar judgment.. Dr. Hempenstall' s intent to deceive the

Examiner can be inferred from his failure to tell the Examiner about a report by Dr. Bird,
another Glaxo scientist.
Dr. Birds report was prepared for the express purpose of

Redacted
being used

(Exhibit 12 to at A054 (G000919)) (D.I. No. 105). Dr. Bird analyzed
the stability data using
stated in the Bird memo,
(Id.) (emphasis added). After analyzing
all of

(Id.); see Pliarmadyne at 311. As

the data, however, Dr. Bird

(Id.) (emphasis added). She further wrote:

ReÒac\eò
(Id.) (emphasis added) (Exhibit A at B002,
Hempenstall Depo. pp. 205-206). Despite knowing Dr. Bird's
, Dr. Hempenstall submitted a declaration to the

Patent Offce that omitted ". . ." from the
and selected only some of the data. With ths cherry-picked data, Dr.

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Hempenstall argued to the Patent Offce that there was a "highly signficant and valuable
improvement." (G00021 1) (emphasis added). Dr. Hempenstall did not tell the Patent

Offce that Dr. Birds analysis of

, showed an effect that

was" \," and he did not tell the Patent Office that his conclusions of "highly
significant" results were from only a subset of Glaxo' s "
" 13

Certainly, these facts create an inference that Dr. Hempenstall intended to deceive the

Patent Offce when he presented incomplete data and characterized those results as

"highy significant."
The evidence presented in the Pharmadyne case created trable issues of

Redacted

materiality and intent with respect to the data Dr. Hempenstall supplied to the Patent
13 Glaxo has again used incomplete data in this case to show that Teva's formulation infrnges the

'249 patent. Dr. Anderson, Glaxo's expert,

(Exhbit C at B006-B007, Anderson Depo. at pp. l49-l50, ll. 4-25, 1-l0). He only analyzed specific Glaxo" " (Exhibit C at B007, Anderson Depo. at p. l50, 1. lO). At his deposition, he was shown
additional ~tabi1ity data that he had not used in his calculations:

(Exhibit Cat B006, Anderson Depo. p. 149,11. 9-22)

* * *.

~eòac\eò
(Exhibit Cat B008-B009, Anderson Depo. pp. l56-l57, l1. 13-25,2-4). Thus, it appears that Glaxo's practice of selectively highlighting subsets of data that aligns with its arguments
continues even today.

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Office. Faced with this evidence, the Pharmadyne cour found the withheld data to be
materiaL. The Pharmadyne court also concluded that Dr. Hempenstall did not have an

intent to deceive, but this Court is not bound by that finding. After reviewing the
evidence, this Cour mayor may not agree with the Pharmadyne court, but it is improper

to reach that conclusion on a summar judgment motion.

Redacted

Dr. Bird's memo provides a strong inference that Dr. Hempenstall knew what he

was doing when he left out the U.K. data and argued that the incomplete data showed

"highly signficant" results. (G000211) Dr. Bird had
" but

did not disclose its contents or conclusions to the Examiner. As a direct result of Dr.
Hempenstall showing a "highly significant and valuable improvement," Glaxo received
its '249 patent. (G00021l-212). These are strong, triable issues of

fact and Glaxo's

motion should be denied.
E. Triable Issues Of Fact Exist On Materiality And Intent To Deceive By

Glaxo's Failure To Submit The TagametCIlEthanol Prior Art.
Durng the prosecution of

the '249 patent, the Patent Examiner rejected the patent
references. One was Chemical Abstracts 97: 61014g

claims based on a number of

(1982), which taught ethanol as a solvent in the synthesis ofranitidine. (G000134).
Another was Chemical Abstracts 104: 102280z (1986), which taught the effect of

ranitidine on meal-induced gastrc pepsin and acid secretion and the infuence of adding
ethanol to the meaL. (G000135). The Examiner also rejected the application on the

Padfield '820 patent, which taught rantidine in oral solution stabilized by pH. (GB
2,142,820 and its equivalent FR 2,547,72 7 (GOOO 182-195)). Other prior art disclosed

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tests in which ethanol was used to induce stomach lesions in rats, and then the effect of
ranitidine on the lesions was tested. (GB 2,120,938 (G000147-159)).

The Examiner had no reference containing a stable, commercial H2 blocker in an
oral solution with ethanoL. Had the Examiner had such a reference, his rejections would

have been much stronger. Indeed, such a reference would not have been cumulative of
the references cited in the application, and it would have been more material than the references cited in the patent application. The TagametCI/ethanol solution was such a
reference, and it was not disclosed to the Patent Office.
The prior art contained a solution of

TagametCI and ethanoL. Tagamet(1 is

cimetidine, an H2 blocker like ranitidine. Consistent with Dr. Long's testimony that he
was aware of

the TagametCI product with ethanol in 1985, the 1985 Physician's Desk

Reference ("PDR") lists TagametCI Liquid as follows:

Each 5 ml. (1 teaspoonful) contains, in aqueous solution, cimetidine hydrochloride equivalent to cimetidine, 300 mg.; alcohol, 2.8%.

(Exhibit D at BOIl, 1985 PDR, p. 1974) (emphasis added).
The 1988 PDR provided a more complete formula and disclosed: Each 5 ml. (one teaspoonful) of clear, light orange, mint-peach flavored liquid contains cimetidine hydrochloride equivalent to cimetidine, 300 mg.; 2.8%. Inactive ingredients consist ofFD&C Yellow No.6, flavors, alcohol, methylparaben, polyoxyethylene polyoxypropylene glycol, propylene glycol, proplyparaben, saccharin sodium, sodium chloride, sodium phosphate, sorbitol and water.

(Exhibit Eat BOI4, 1988 PDR, p. 2031) (emphasis added).

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As show above, the TagametCI/ethanol product contained all of the ingredients of

Glaxo's patented formula except for ranitidine and methylcellulose.14 The
TagametCI/ethanol formula also contained

Redacted

, which is what Teva uses.

The Pliarmadyne court's conclusion that "the Tagamet reference was cumulative

and not material" was wrong. Pharmadyne at 3 i 0-3 i i. No prior art before the Examiner
so closely matched the product described in the '249 patent application as the
TagametCI/ethanol reference. The Chemical Abstracts only disclosed ethanol in the

synthesis of ranitidine and experimental use in humans, not in solution with ranitidine.

The ethanol in this reference was not in the final ranitidine product; it was removed.
Glaxo's '938 patent described the use of ethanol to induce lesions. The '820 patent

disclosed a ranitidine formulation without ethanoL. No prior ar before the Examiner
showed an H2 blocker combined with ethanol in a presumably stable commercial
product.
Dr. Long, the inventor of the '249 patent, was aware of

the TagametCI/ethanol

solution but did not disclose it to the Patent Office. Pliarmadyne at 278; (Exhibit B at
B004, Long Depo. p. 53, lines 14-17). This Court, therefore, should analyze for itself

the

materiality of

the TagametCI/ethanol disclosure and Dr. Long's intent to deceive the

Patent Office.

Certainly, there is a trable issue about whether the TagametCI/ethanol solution
was materiaL. It had features important to the invention unlike any other piece of prior

art. It combined an H2 blocker in an oral solution with ethanol in a presumably stable

14 The "ilustrative" example shown in the '249 patent discloses ranitidine, ethanol,

phosphate buffers, methy1cellulose, paraben preservatives, sorbitol, flavor and water. (Co!. 2,11.47-64) (emphasis added).
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commercial product. No other reference was this close to the invention. The
Tagamet(I/ethanol solution, therefore, was material and non-cumulative.
As to intent, there is sufficient information to infer intent. Dr. Long was aware of

the Tagamet(I/ethanol solution. (Id.) It would be incredible that he would not realize
that the Tagamet(I/ethanol solution was a better reference than anything the Patent Offce
had found or cited. This, alone, or coupled with Dr. Hempenstall's conduct, which could
infer a corporate culture of

non-disclosure, certainly results in a trable issue on intent.

After all, the Federal Circuit has said that "smoking guns" are rarely found evidencing
intent, nor is a smoking gun required. See Warner-Lambert Co. v. Teva Pliarms. USA,

Inc., 418 F.3d 1326, 1346 (Fed. Cir. 2005) (Smoking gun evidence is not required in

order to find intent to deceive.) Although there is no smoking gun showing that Dr. Long
intentionally withheld the TagametCI/ethanol solution from the Patent Office, the facts

could lead to that conclusion and, therefore, preclude a grant of summary judgment.

Glaxo's brief spends its time arguing why the Tagamet(I/ethanol solution is

different from the invention. These distinctions and arguments miss the point. The
TagametCI/ethanol solution was more material than any other reference disclosed to the
Patent Offce or cited by the Patent Offce. Glaxo, in meeting its obligation of

"complete

candor" should have disclosed this solution to the Examiner, told him of the similarties
to the invention and then argued the differences that are now found in its brief. See
Rolim & Haas Co. v. Brotecli Corp., 127 F.3d 1089, 1093 (Fed. Cir. 1997). That would
have been "complete candor." Id. Glaxo did not do this, and its after-the-fact denigration
15
of the TagametCI/ethanol solution is not relevant to excuse its non-disclosure.

15 It is interesting that Glaxo now argues that ranitidine and cimetidine are so different that
cimetidine would not be material and yet, during the prosecution of

the '249 patent application,

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V. CONCLUSION
There is evidence and inferences from the evidence to support Teva's claim that

Dr. Hempenstall intentionally withheld stability data from the Patent Offce and that this
withheld evidence would have prevented him from arguing that the data showed a
"highly significant" improvement.
There is evidence and inferences from the evidence to suggest that Dr. Long
intentionally did not disclose the closest piece of prior art, the TagametCI/ethanol
solution, which had more features of the invention than any other single piece of

prior art

cited in the prosecution history. Dr. Long knew of

the TagametCI/ethanol solution, and

yet, he did not disclose it.

For the aforementioned reasons, Glaxo's motion to dismiss Teva's inequitable
conduct defense and counterclaim should be denied.

YOUNG CONAWAY STARGATT & T AYLOR, LLP

Jos W. Ingersoll (# 1 88) Karen E. Keller (#4489) Young Conaway Stargatt & Taylor, LLP The Brandywine Building 1000 West Street, 17th Floor P.O. Box 391 Wilmington, DE 19899
Telephone: (302) 571-6600

kkeller(£ycst.com

Glaxo cited the '938 application that referred to both ranitidine and cimetidine in the same
application. (G000147, GOOOl50, lines 52-57).

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MERCHAT & GOULD P.C.
Mark D. Schuman Ronald A. Daignault
J effer Ali

Jeffrey C. Brown 3200 IDS Center 80 South 8th Street Minneapolis, MN 55402
Teva Pharmaceuticals USA, Inc. and Teva Pharmaceutical Industries, Ltd.

Dated: July 28, 2006

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CERTIFICATE OF SERVICE

I, Karen E. Keller, Esquire, hereby certify that on July 28, 2006, I caused to be
electronically filed a tre and correct copy of the foregoing document with the Clerk of

the Cour

using CM/CF, which wil send notification that such filing is available for viewing and
downloading to the following counsel of

record:

Francis DiGiovann, Esquire
Connolly Bove Lodge & Hutz LLP

The Nemours Building 1007 North Orange Street Wilmington, DE 19801
I further certify that on June 30, 2006, I caused a copy of

the foregoing document to be
record and on the following non-

served by hand delivery on the above-listed counsel of

registered parcipants in the maner indicated:

BY E-MAL AND FEDEX
Brian P. Murhy, Esquire
Thomas Puppa, Esquire

Morgan Lewis & Bockius, LLP 101 Park Avenue New York, NY 10 l78-0060

YOUNG CONAWAY STARGATT & TAYLOR, LLP

~e~:.1f
The Brandywine Building i 000 West Street, 17th Floor
(302) 571-6600
Wilmington, Delaware 19801

kkellerêycst.com
Attorneys for Teva Pharmaceuticals USA, Inc. and

Teva Pharmaceutical Industries, Ltd.

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