PHILADELPHIA — Patents related to two of the University of
Pennsylvania’s Juxtapid high-cholesterol treatment methods were upheld by the
Patent Trial and Appeal Board after they were challenged by hedge fund manager
Kyle Bass’ Coalition for Affordable Drugs.
Kerry S. Taylor, partner at Knobbe, Martens, Olson &
Bear LLP, said the fact that the board gave weight to UPenn’s commercial success
in its decision to uphold the patents is “noteworthy.”
“In the (U.S. Patent and Trademark Office’s inter partes
review) proceedings, their holdings on obviousness are rarely swayed by ‘secondary
consideration’ of non-obviousness, such as commercial success,” Taylor told the
Pennsylvania Record. “The board found
UPenn’s argument of a lack of expectation of success to be convincing,
particularly in conjunction with UPenn’s evidence of commercial success.”
UPenn said Juxtapid had generated $420 million in revenue,
but the coalition claimed that the commercial success of the method had no
bearing on its challenge.
In addition to considering the commercial success of the
patented methods, the board also based its decision on a finding that a slide
deck provided by the coalition to investors and, eventually, webpage viewers,
did not qualify as a “printed publication” in accordance with patent laws.
UPenn claimed that the slide deck did not constitute a
printed publication because the audience was not “skilled in the relevant art
and because there was insufficient evidence of the public availability of the
slide deck,” Taylor and Knobbe Martens colleague Mark Davis said in a piece
written for jdsupra.com.
However, the coalition argued to the board that the slide
deck was a printed publication because it could be downloaded by the public “shortly
after” it was submitted to investors.
Taylor said Bass announced several years ago that he
would be filing challenges to drug patents under the USPTO’s new inter partes review (IPR) procedures.
“Roughly speaking, Kyle Bass’ challenges have about a 50
percent to 60 percent success rate of the IPR being instituted and about a 30 percent success rate of
challenged claims being found unpatentable,” Taylor said. The IPR works as a threshold
decision to enter the proceeding.
Taylor said universities such as UPenn do sometimes find
themselves subject to patent challenge proceedings, although he was not sure
how often that occurs.
“However, the USPTO recently held that a state university
could not be challenged in view of its state sovereign immunity,” Taylor said. “UPenn,
however, is a private university, so that would not have mattered for this