Novartis Pharmaceuticals Corporation et al v. Actavis South Atlantic LLC et al

Filing 414

TRIAL OPINION (*Novartis should submit an agreed upon form of final judgment within two weeks). Signed by Judge Richard G. Andrews on 6/18/2014. Associated Cases: 1:11-cv-01077-RGA, 1:11-cv-01112-RGA(nms) (Main Document 414 replaced on 6/18/2014) (nms).

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE

NOVARTIS PHARMACEUTICALS
CORPORATION, NOVARTIS AG,
NOV ARTIS PHARMA AG, NOV ARTIS
INTERNATIONAL PHARMACEUTICAL
LTD., and LTS LOHMANN THERAPIESYSTEME AG,
Civil Action No. 11-1077-RGA
(Consolidated)

Plaintiffs,
V.

PAR PHARMACEUTICAL, INC.,
Defendant.

NOVARTIS PHARMACEUTICALS
CORPORATION, NOV ARTIS AG,
NOVARTIS PHARMA AG, NOVARTIS
INTERNATIONAL PHARMACEUTICAL
LTD., and LTS LOHMANN THERAPIESYSTEME AG,
Civil Action No. 11-1112-RGA

Plaintiffs,

v.
WATSON LABORATORIES, INC.,
WATSON PHARMA, INC., and ACTAVIS,
INC.,
Defendants.

TRIAL OPINION

Michael P. Kelly, Esq., McCARTER & ENGLISH, LLP, Wilmington, DE; Nicholas N. Kallas,
Esq., FITZPATRICK, CELLA, HARPER & SCINTO, New York, NY; Filko Prugo, Esq.,
FITZPATRICK, CELLA, HARPER & SCINTO, New York, NY.
Attorneys for Plaintiffs Novartis Pharmaceuticals Corporation, et al.

Melanie K. Sharp, Esq., YOUNG CONAWAY STARGATT & TAYLOR, LLP, Wilmington,
DE; E. Anthony Figg, Esq., ROTHWELL, FIGG, ERNST & MANBECK, P.C., Washington,
D.C.; C. Nichole Gifford, Esq., ROTHWELL, FIGG, ERNST & MANBECK, P.C., Washington,
D.C.; Seth E. Cockrum, Esq., ROTHWELL, FIGG, ERNST & MANBECK, P.C., Washington,
D.C.; Brett A. Postal, Esq., ROTHWELL, FIGG, ERNST & MANBECK, P.C., Washington,
D.C.
Attorneys for Defendants Watson Laboratories, Inc., et al.

June

lK_, 2014

Novartis Pharmaceuticals Corporation, Novartis AG, Novartis Pharma AG, Novartis
International Pharmaceutical Ltd., and LTS Lohmann Therapie-Systeme AG (collectively,
"Novartis" or "Plaintiff') brought this suit against Watson Laboratories, Inc., Watson Pharma,
Inc., Watson Pharmaceuticals, Inc. (collectively "Watson" or "Defendant"), and Par
Pharmaceutical, Inc. 1 alleging infringement of U.S. Patent Nos. 6,335,031 ("the '031 patent")
and 6,316,023 ("the '023 patent") (collectively, "the patents in suit"). Both patents share the
same specification. 2 The '031 and '023 patents claim pharmaceutical compositions, transdermal
devices, and methods of stabilizing compositions comprising the drug rivastigmine, which is an
acetylcholinesterase inhibitor, and an antioxidant. (D.I. 310, p. 1). Novartis sells an Exelon®
transdermal patch for the treatment of Alzheimer's disease that contains rivastigmine. Novartis
listed the '031 and '023 patents in the Food and Drug Administration's "Approved Drug
Products with Therapeutic Equivalence Evaluations," frequently referred to as the "Orange
Book," as covering the Exelon® patches. Watson's Abbreviated New Drug Application 202,119
("ANDA") seeks approval to engage in the commercial manufacture, importation, use, or sale of
a transdermal patch containing rivastigmine and an antioxidant prior to the expiration of the
patents in suit.
Watson's ANDA product is a transdermal patch that contains a backing film, an adhesive
bilayer comprised of a 905A adhesive and a 900A adhesive, and a protective release liner, a
schematic of which is shown below:

1
Both the Par and Watson defendants were scheduled for trial beginning on August 26, 2013. Par and Novartis
informed the Court on the morning of the first day of trial that a settlement had been reached. Relying on this
representation, the Court entered an order staying the action with respect to Par for forty-five days and dismissed Par
from the trial. (D.I. 293). The settlement later fell through, and a trial for Par and Novartis took place on May 1,
2014.
2
Unless otherwise noted, all citations to the specification refer to the '031 patent.

1

(JTX 56, p. 1822-23). The process for manufacturing Watson's ANDA product can be
summarized as follows: 1) the 905A adhesive and rivastigmine, the active ingredient, are mixed
to form the 905A casting solution; 2) the 905A casting solution is applied to a polyester release
liner, which is subsequently passed through a drying oven; 3) the 900A adhesive is applied to a
polyester release liner and passed through a drying oven; 4) the release liner for the 905A layer is
removed and the exposed 905A layer is laminated onto the 900A layer, thereby forming the
adhesive bilayer; 5) the adhesive bilayer is then cut to size, packaged, and heat sealed into
pouches. (Id., pp. 1832-34). Watson's ANDA product is available in 5 and 10 square centimeter
sizes. (Id.).
Novartis asserts that Watson's ANDA products infringe claims 3, 7, 13, 16, and 18 of the
'031 patent and claims 2 and 7 of the '023 patent. Watson counters that the asserted claims are
obvious under 35 U.S.C. § 103(a) and not infringed. The Court held a four day bench trial from
August 26-29, 2013. (D.I. 306, 307, 308 & 309). As explained below, Novartis proved that
Watson's ANDA products infringe by a preponderance of the evidence, and Watson did not
prove by clear and convincing evidence that the asserted claims were invalid as obvious.

2

I. INFRINGEMENT
The five asserted claims in the '031 patent depend from non-asserted independent claims
1, 11, and 15, which are drawn to pharmaceutical compositions, transdermal devices, and a
stabilization method, respectively. Claim 1 of the '031 patent recites:
A pharmaceutical composition comprising:
(a) a therapeutically effective amount of (S)-N-ethyl-3-{(1dimethylamino)ethyl}-N-methyl-phenyl-carbamate in free base or acid addition
salt form (Compound A);
(b) about 0.01 to about 0.5 percent by weight of an antioxidant, based on
the weight of the composition, and
(c) a diluent or carrier.
'031 patent, claim 1. In the claim language "Compound A" refers to rivastigmine, the "S"
enantiomer of the racemic compound RA1. 3 Claim 3 narrows the pharmaceutical composition
to those in which the antioxidant is "tocopherol, esters thereof, ascorbic acid,
butylhydroxytoluene, butylhydroxyanisole or propyl gallate." Claim 7 recites a "transdermal
device comprising a pharmaceutical composition as defined in claim 1, wherein the
pharmaceutical composition is supported by a substrate."
The requirements of claim 11 are as follows:
A transdermal device comprising a backing layer, a layer comprising a
therapeutically effective amount of (S)-N-ethyl-3-{(l-dimethylamino)ethyl}-Nmethyl-phenyl-carbamate (Compound A) and an amount of antioxidant effective to
stabilize Compound A from degradation in a polymer matrix, a release-liner and,
disposed between the layer comprising Compound A in a polymer matrix and the
release-liner, a discrete layer of adhesive material for releasably fixing said
transdermal device to a patient's skin.

3

N-ethyl-3-{(l-dimethylamino)ethyl}-N-methyl-phenyl-carbamate, abbreviated as "RA7," is a racemate. A
racemate is a compound that is composed of two enantiomers of a chiral molecule, denoted as "S" and "R." The
two enantiomers are identical in all respects except for the fact that they are mirror images of each other. {Tr. 67: 1769:1).

3

Id., claim 11. Claim 13 limits the identity of the antioxidant in the transdermal device to
"tocopherol, esters thereof, ascorbic acid, butylhydroxytoluene, butylhydroxyanisole or propyl
gallate."
Claim 15 recites:
A method of stabilizing (S)-N-ethyl-3-{(l-dimethylamino)ethyl}-Nmethyl-phenyl-carbamate in free base or acid addition salt form (Compound A),
wherein the method comprises forming a composition by combining Compound A
with an amount of antioxidant effective to stabilize Compound A from degradation.

Id., claim 15. Claim 16 limits the method's antioxidant to "tocopherol, esters thereof, ascorbic
acid, butylhydroxytoluene, butylhydroxyanisole or propyl gallate," and claim 18 limits the
amount of antioxidant to "about 0.01 to about 0.5% by weight based on the weight of the
composition."
Two claims from the '023 patent, claims 2 and 7, are also asserted by Novartis. Claim 2
depends from claim 1, which recites:
A pharmaceutical composition comprising 1 to 40 weight percent of (S)-Nethyl-3-[(l-dimethylamino)ethyl]-N-methylphenyl carbamate in the form of a free
base or acid addition salt, 0.01 to 0.5 weight percent of an antioxidant, and a diluent
or carrier, wherein the weight percents are based on the total weight of the
pharmaceutical composition.
'023 patent, claim 1. Claim 2 limits the composition of claim 1 to those where the antioxidant is
"tocopherol, esters of tocopherol, ascorbic acid, esters of ascorbic acid, butylhydroxytoluene,
butylhydroxyanisole, propyl gallate, and combinations thereof" Independent claim 7 requires:
A transdermal device comprising a pharmaceutical composition comprising
1to40 weight percent of (S)-N-ethyl-3-[(l-dimethylamino)ethyl]-N-methylphenyl
carbamate in the form of a free base or acid addition salt, 0.01to0.5 weight percent
of an antioxidant, and a diluent or carrier, wherein the weight percents are based on
the total weight of the pharmaceutical composition.

Id., claim 7.

4

The claims asserted by Novartis can be broken down into two groups: the "presence"
claims and the "function" claims. Claims 3 and 7 of the '031 patent, as well as claims 2 and 7 of
the '023 patent, constitute the presence claims. These claims require proof that Compound A
and an antioxidant are present. The Court defined "antioxidant" as an "agent that reduces
oxidative degradation." (D.I. 250, pp. 1-2). There is no additional requirement that the
antioxidant function with respect to Compound A because that is specifically required in the
function claims. (Id., p. 2 ("The patents repeatedly disclose the combination of Compound A
and the antioxidant without specifically requiring that the antioxidant affect Compound A. It
would be improper to preclude those embodiments by limiting 'antioxidant' to require that
interaction." (internal citations omitted))).
Claims 13, 16, and 18 of the '031 patent are referred to as the function claims. All three
claims require "an amount of antioxidant effective to stabilize compound A from degradation,"
which the Court construed to mean, "an amount of antioxidant that will significantly reduce
degradation of Compound A over a prolonged period of time." (Id., pp. 2-3). The function
claims, therefore, have an additional requirement that the antioxidant interact with Compound A
to reduce degradation. The Court also construed "stabilizing" to mean "significantly reducing
degradation over a prolonged period of time." (Id., p. 3). These three terms are the only ones at
issue, and the parties agree that the remaining elements of the asserted claims are met. (D.I. 310,
pp. 29-30).

In its post-trial briefing, Watson contends Novartis failed to prove infringement of the
presence claims because those claims have a functional limitation and Novartis never proved that
Watson's product contains an agent that reduces oxidative degradation of any component. (D.I.
318, pp. 1-2). Watson asserts it does not infringe the function claims because the testing

5

conducted by Novartis's experts does not prove that Watson's ANDA product is an oxidative
environment or that it contains a functioning antioxidant.

A. Legal Standard
"Under [35 U.S.C.] § 271(e)(2)(A), a court must determine whether, ifthe drug were
approved based upon the ANDA, the manufacture, use, or sale of that drug would infringe the
patent in the conventional sense." Glaxo, Inc. v. Novopharm, Ltd., 110 F.3d 1562, 1569 (Fed.
Cir. 1997). The application of a patent claim to an accused product is a fact-specific inquiry.

See Kustom Signals, Inc. v. Applied Concepts, Inc., 264 F.3d 1326, 1332 (Fed. Cir. 2001).
Literal infringement is present only when each and every element set forth in the patent claims is
found in the accused product. 4 See Southwall Techs., Inc. v. Cardinal JG Co., 54 F.3d 1570,
1575-76 (Fed. Cir. 1995). The patent owner has the burden of proving infringement by a
preponderance of the evidence. Envirotech Corp. v. Al George, Inc., 730 F.2d 753, 758 (Fed.
Cir. l984)(citingHughesAircraftCo. v. United States, 717F.2d 1351, 1361 (Fed. Cir.1983)).
Infringement can be shown by "any method of analysis that is probative of the fact of
infringement," and, in some cases, "circumstantial evidence may be sufficient." Martek

Biosciences Corp. v. Nutrinova, Inc., 579 F.3d 1363, 1372 (Fed. Cir. 2009).
B. Findings of Fact

1. Butylhydroxytoluene ("BHT") is a well-known antioxidant.
2. BHT is present in Watson's ANDA product.
3. BHT is present in an amount between 0.01 and 0.5 percent by weight.
4. Rivastigmine is subject to oxidative degradation in an oxidative environment.
5. The presence of oxygen, peroxides, or other free radical generators creates an
oxidative environment.

4

There are no assertions of infringement by the doctrine of equivalents.

6

6. Oxygen, peroxides, and other free radical generators are present in Watson's
ANDA product.
7. Watson's ANDA products show only minimal degradation ofrivastigmine
over a prolonged period of time.
8. BHT acts as an antioxidant to protect rivastigmine from oxidative degradation.
9. Watson's ANDA product infringes all asserted claims of the '023 and '031
patents.

C. Conclusions of Law
1. The Presence Claims
a. The presence claims do not require a functioning antioxidant
The three limitations of the presence claims are: Compound A, a certain weight percent
of antioxidant, and a diluent or carrier. See, e.g., '031 patent, claim 1. Unlike the function
claims, nowhere in the presence claims is any function of the antioxidant mentioned. Compare
id. (requiring Compound A and "about 0.01 to about 0.5 percent by weight of an antioxidant"),
with id., claim 11 (reciting Compound A "and an amount of antioxidant effective to stabilize
Compound A from degradation" (emphasis added)). The Court cautioned in its claim
construction opinion that it would be "improper to impute the antioxidant's stabilizing effect on
Compound A, explicitly claimed in some claims [i.e., the function claims], into claims that do
not contain that explicit limitation [i.e., the presence claims]." (D.I. 250, p. 2). Despite this clear
statement, Watson maintains that "antioxidant," as used in the patents in suit, "requires the
presence of an agent that reduces oxidative degradation of some component in the claimed
composition." (D.I. 318, pp. 12-13 ("The definition of 'antioxidant' adopted by the Court, 'an
agent that reduces oxidative degradation,' plainly recognizes that the term is a functional
limitation that requires a reduction of oxidative degradation in the claimed composition.")). This
argument is rejected as being inconsistent with the Court's claim construction.
7

b. Watson's ANDA products meet every limitation of the presence claims
The parties agree that Watson's ANDA product contains Compound A (PTX 311, p.
1603) and a diluent/carrier. (JTX 56, p. 1823). Only the second limitation requiring "0.01 to 0.5
weight percent" of an antioxidant is in dispute. 5
Butylhydroxytoluene, or BHT, is well known in the art as an antioxidant. (DTX 11, p.
47; PTX 17, p. 203; JTX 184, p. 1261; JTX 19, p. 441; DTX 55, p. 263). The patents in suit also
identify BHT as an antioxidant in the specification and claim BHT as an antioxidant in the
asserted claims. '031patent,4:11-14 ("The applicant has found that an effective stabilising
effect is surprisingly achieved when the antioxidant is selected from ... butylhydroxytoluene.");

id., claim 3 ("A pharmaceutical composition according to claim 1 wherein the antioxidant is ...
butylhydroxytoluene."). Novartis's infringement expert, Dr. Davies, performed tests 6 on
Watson's ANDA products that identified the presence ofBHT. (Tr. 312:15-21). Watson's
expert, Dr. Sessler, admitted that Watson's ANDA products contain BHT (Tr. 398:21-399:1),
and Watson itself conceded that BHT may have been introduced into its product by an upstream
supplier. (D.I. 318, p. 6 n.2 ("It appears that BHT may have been added to the tackifier
component by one ofHenkel's suppliers upstream in the polymer manufacturing process and that
small amounts ofBHT were carried over into Watson's ANDA product as an unreactive
impurity.")). This evidence proves that BHT, a well-known antioxidant, is present in Watson's
ANDA products.
BHT is present in Watson's ANDA products within the claimed ranges: 0.01 to 0.5
percent by weight of the composition. Dr. Davies tested the 905A adhesive in isolation using gas

5

Claim 1 of the '031 patent requires "about" 0.01 to "about" 0.5 percent by weight. This difference is immaterial
because, as shown below, the measured amount of antioxidant falls within the 0.01 to 0.5 weight percent range.
6
The tests Dr. Davies utilized were gas chromatography and gas chromatography coupled with mass spectrometry.
(Tr. 311:21-312:21).

8

chromatography and found BHT at a level of 447 parts per million, which is 0.045 percent. (JTX
41, p. 2; JTX 36; Tr. 320:7-20). After the addition ofrivastigmine to the 905A adhesive layer,
the BHT concentration is decreased to 0.032 percent. (JTX 41, p. 2; Tr. 320:10-321:17). Dr.
Davies then performed the same tests on the 905N900A adhesive bilayer and measured 0.027
percent BHT. (JTX 41, p. 2; JTX 36). Using these result, Dr. Davies calculated 7 the amount of
BHT in the drug-containing 905A layer in two scenarios: 1) all of the BHT remains in the 905A
layer but the rivastigmine becomes distributed throughout the 905N900A adhesive bilayer via
diffusion; 8 and 2) BHT and rivastigmine both diffuse and become evenly distributed in the
905N900A adhesive bilayer. (JTX 41, pp. 1-2). The amount ofBHT in the 905A layer under
those two scenarios is 0.036 and 0.023 percent by weight, respectively. (Id., p. 2; Tr. 113:15120:6). In response to criticism from Dr. Sessler, Dr. Davies repeated his experiments using
high performance liquid chromatography and ultraviolet spectroscopy. (Tr. 329: 13-330:8).
These additional tests showed "excellent agreement" with the gas chromatography results and
confirmed his earlier findings. (Id. at 330:4-14; JTX 51).
In addition to Dr. Sessler' s criticism, Watson advances several other arguments in

support of its non-infringement position. Watson points out that "BHT is not identified in any of
Watson's product development reports for the formulation used in Watson's ANDA product, and
BHT is not mentioned anywhere in Watson's ANDA." (D.I. 318, p. 6). The fact that those
reports did not detect and quantify BHT does not mean no BHT is present. Novartis has shown,

7

Dr. Davies was not able to measure the diffusion ofBHT experimentally because the BHT level is below the
instrument's limit of detection. (Tr. 328:10-16). Nonetheless, there are several reasons to believe that BHT will
diffuse. First, there is no barrier to diffusion between the 905A and 900A adhesive layers. Second, Dr. Davies
experimentally confirmed that rivastigmine diffuses through the bilayer. Third, BHT is a smaller molecule than
rivastigmine which, generally speaking, means it will more readily diffuse. (Tr. 121 :17-122:22).
8 The adhesive bilayer is a highly diffusible system, allowing the rivastigmine to travel from the 905A layer through
the 900A layer and into the patient's skin. (Tr. 323:15-324:7). Dr. Davies confirmed the diffusion ofrivastigmine
experimentally through Raman spectroscopy. (Tr. 323: 15-329:3; JTX 38).

9

and Watson now appears to admit (id., p. 6 n.2), that Watson's ANDA products contain BHT.
How the BHT entered Watson's product and why previous reports did not quantify the amount
ofBHT is irrelevant for purposes of infringement. Watson also asserts that Novartis should have
conducted additional testing for "BHT daughter products" to prove that the BHT in Watson's
ANDA product actually functioned as an antioxidant. (Id., pp. 29-30). This line of testing is not
necessary because, as discussed above, the presence claims do not add a functional limitation
vis-a-vis the antioxidant.
In summary, the amount of BHT, a known antioxidant, present in both scenarios
evaluated by Dr. Davies falls within the amount required in the asserted claims. Watson does not
dispute that its ANDA product meets the other claim limitations. (D.I. 310, p. 30). Therefore,
Novartis has proven by a preponderance of the evidence that Watson's ANDA product infringes
the presence claims of the patents in suit.
2. The Function Claims
As explained by the Federal Circuit, patentees are permitted to prove infringement by
"any method of analysis that is probative of the fact of infringement, and circumstantial evidence
may be sufficient." Martek Biosciences Corp., 579 F.3d at 1372-73 (internal citation omitted)
(finding combination of testing and scientific literature sufficient to prove infringement).
According to Watson, Novartis must establish the following three elements to prove
infringement of the function claims: "(1) rivastigmine oxidatively degrades in Watson's product;
(2) BHT is significantly reducing the oxidative degradation of rivastigmine in Watson's product;
and (3) the significant reduction of the oxidative degradation of rivastigmine occurs over a
prolonged period of time." (D.I. 318, p. 13). Here, Novartis has proven that free radical
generators create an oxidative environment, that Watson's ANDA products contain three known
10

free radical generators, and that rivastigmine is susceptible to oxidative degradation in the
presence of those free radical generators. Despite this oxidative environment, the rivastigrnine in
Watson's ANDA products undergoes only minimal oxidative degradation over a prolonged
period of time. The most logical conclusion is that the BHT in Watson's ANDA products acts as
an antioxidant by scavenging free radicals, thereby protecting rivastigrnine from oxidative
degradation.
a. Watson's ANDA product is an oxidizing environment
Watson's ANDA product is manufactured and stored in an oxidative environment.
Oxidative degradation is a type of chemical reaction, caused by the presence of free radicals,
"where the substance that is oxidized loses an electron to another substance that is called an
oxidant." (Tr. 134:22-135:9). Free radicals are a highly reactive species due to their free or
unpaired electrons. (Id. at 135: 15-19). Species with paired electrons are more stable, so free
radicals take electrons from other molecules to pair their free electrons. (Id. at 135:20-24).
Oxygen, peroxides, and other free radical generators, which include residual monomers, are three
common sources of free radicals. (Id. at 136:14-137:12). Importantly, chain reactions do not
require large quantities of free radicals. (See, e.g., JTX 188, p. 1507 ("Only a very small amount
of oxygen is required to initiate a chain reaction."); Tr. 136:22-137:4). Watson's ANDA product
is exposed to all three categories of free radical generators, which creates an oxidative
environment. The presence of each free radical generator will be discussed in turn.
Every step of Watson's manufacturing process is carried out in the presence of air, which
contains oxygen. Rivastigrnine is mixed with the 905A adhesive in ambient air, the 905A
casting solution is passed through a filter in ambient air, the 905A casting solution is coated onto
the release liner in ambient air, the 905A-coated release liner is dried in the presence of "filtered
11

and heated air," the backing layer is laminated onto the 905A adhesive in ambient air, the 900A
casting solution is coated onto the release liner in ambient air, the 900A-coated release liner is
dried in the presence of "filtered and heated air," and the 900A and 905A adhesive layers are
laminated together in ambient air. (JTX 56, pp. 1832-37). The individual product patches are
also cut and pouched in ambient air. (Id.). Indeed, Dr. Sessler acknowledged during crossexamination that the external environment for each step of the manufacturing process occurs in
ambient air. (Tr. 513:4-518:19). It should come as no surprise, therefore, that Dr. Davies found
the presence of oxygen inside the pouch containing Watson's ANDA product in a concentration
comparable to that of ambient air. (JTX 54, p. 2; Tr. 339:22-330:14).
Watson raises two counterarguments questioning whether the manufacturing process's
environment is indicative of the oxygen levels in the ANDA product itself. First, Dr. Sessler
emphasized that pressurized nitrogen is used to extrude the 905A and 900A adhesive solutions
onto the release liners, thereby forming a "nitrogen-saturated solution." (Tr. 514:10-515:21).
Although the nitrogen gas does not stay in the adhesive layer, Dr. Sessler testified that he
believed "a blanket of vapor and nitrogen" would form around the adhesive and protect it from
oxygen molecules. (Id. at 453:2-23). Dr. Sessler did not provide any support for this argument
other than the general scientific principle that gas solubility decreases at higher temperature,
which would lead to the "out gassing" of nitrogen from the adhesive. (Id.). Even if Dr. Sessler
was correct in his hypothesis about the nitrogen blanket, the nitrogen blanket would only protect
the adhesive from oxygen for the steps following extrusion. There would be no nitrogen blanket
for any of the previous steps, each of which was conducted in the environment of ambient air.
Second, Watson criticized Dr. Davies for failing to determine whether oxygen is present
in the adhesive bilayer itself. (D.I. 318, p. 15). Dr. Davies was unable to perform direct testing

12

on the adhesive bilayer both because the bilayer was too thin (on the order of 90 microns thick)
and because placing the needle into the bilayer would block the sensor. (Tr. 351: 11-22).
Novartis did, however, link the oxygen concentration in the pouch to the oxygen concentration in
the adhesive bilayer. The backing layer used in Watson's ANDA product is described by the
manufacturer as having "high oxygen transmission rates." (JTX 24, p. 2652; Tr. 165:7-15). Dr.
Klibanov, another Novartis expert, testified that the oxygen present in the pouch will "readily
penetra[te]" the backing film and enter Watson's ANDA product. (Tr. 165:7-166:15). Indeed,
Dr. Sessler agreed that these transdermal patches are designed for air to permeate the patch to
enhance skin health, which requires that the backing layer allow for the diffusion of oxygen. (Id.
at 522:13-22). Therefore, it is a logical conclusion that the gases in the pouch, which include
oxygen, will enter into Watson's ANDA product.
Watson's ANDA products also contain peroxides. The peroxide value, or peroxide
number, test is a well-known method for detecting peroxides. U.S. Patent No. 6,699,498, 2:5862 ("the '498 patent") ("The peroxide content is commonly expressed by means of the so-called
peroxide number."). As described in the U.S. Pharmacopeia, the test "expresses, in
milliequivalents of active oxygen, the quantity of peroxide contained in 1000 g of the substance."
(JTX 47, p. 152). Using this standard experiment, Dr. Davies tested samples of both the 900A
and 905A bulk adhesives and found the presence of peroxides. (JTX 53, p. 2 (noting peroxide
values of 1.64 and 1.89 for the 900A adhesive and 0. 72 and 1.07 for the 905A adhesive); Tr.
353:17-354:20). In addition to Dr. Davies's testing, Novartis relies on two documents from
Henkel, Watson's adhesive manufacturer, showing that peroxides are used in the manufacture of
the adhesive and might remain after manufacturing is complete. Henkel lists tamylperoxypivalate ("TAPP"), a known peroxide, as an ingredient in the 900A adhesive whose

13

purpose is to scavenge residual monomers. (JTX 23, p. 1; Tr. 174:13-175:5). Moreover, a
Henkel employee informed Watson in an email that the 900A adhesive "contains trace amount[ s]
of residual initiator, which is a peroxide" when Watson inquired about the 900A components.
(JTX 32, p. 285088).
Watson offers three arguments in rebuttal. First, Watson contends that the peroxide test
used by Dr. Davies does not measure for peroxides. (DJ. 318, p. 17). Watson is technically
correct because the peroxide test actually measures the extent to which iodide ions can be
oxidized to iodine. However, as Dr. Klibanov explained, the test is conducted under conditions
where the measured oxidation is attributable to the presence of peroxides. (Tr. 286:3-287:4 ("Q.
So it's a bit of a misnomer to say [the peroxide value test] measures peroxide. It is not directed
to peroxides; correct? A. No. I disagree with that. Q. All right. Well, you wouldn't disagree
that what it actually measures is the extent to which iodide is oxidized to iodine? A. Yes, but it's
done under the conditions where what you measure is a peroxide. That's the test that is
described by the United States Pharmacopeia specifically to determine peroxide oxidation
number.")). Watson believes this is problematic because there are numerous substances other
than peroxides that can oxidize iodide to iodine but that are incapable of oxidizing rivastigmine.
(D.1. 318, p. 17; Tr. 429:22-430: 16). Despite flagging this as a potential issue, neither Dr.
Sessler in his trial testimony, nor Watson in its post-trial briefing, offered any scientific literature
in support of its position that this test was applied improperly. Watson's unsubstantiated
argument is not persuasive in light of the U.S. Pharmacopeia and a U.S. patent on transdermal
devices that both list the peroxide value test as a standard method for determining the quantity of
peroxides. (JTX 47, p. 152; '498 patent, 2:58-62; see also Tr. 354:7-11).

14

Second, Watson asserts the tests Dr. Davies conducted on the samples of bulk 900A and
905A adhesive have no bearing on the peroxide level in Watson's ANDA product. (D .I. 318, p.
17). This, too, is unpersuasive because Dr. Davies explained that testing the adhesives
themselves prior to their inclusion in the transdermal device is the standard approach. (Tr.
354:21-355:15). Dr. Sessler agreed on cross examination that the method used by Dr. Davies is
taught in the '498 patent, which addresses transdermal systems. (Tr. 526:16-527:9; '498 patent,
3:24-42). In addition, Dr. Davies testified that it would not be practical for him to test the actual
ANDA product because he would have to remove the adhesive bilayer from the product. (Tr.
355:16-356:13). This process is difficult and would require roughly 150 patches to obtain
enough material to conduct a single test. (Id.). Moreover, Dr. Klibanov noted that Watson did
not take any steps to remove the peroxides from either the 900A or 905A adhesive layer, so it
stands to reason that the peroxides will still be present when those two peroxide-containing
layers are combined to form a bilayer. (Id. at 179:7-18).
Finally, Watson disagrees over the import of the Henkel documents cited by Novartis.
The fact that Henkel uses TAPP in the manufacturing process proves nothing, according to
Watson, because TAPP is used as a monomer scavenger. (D.I. 318, p. 20). Monomer
scavengers are consumed during the manufacturing process so Watson posits there is no reason
to believe that TAPP carries over to the ANDA product, 9 and Novartis did not conduct any tests
to confirm its theory. (Tr. 439: 13-24). It is true that Novartis did not perform experiments to
determine ifresidual TAPP is present in Watson's ANDA product. The identity of the particular
peroxide(s) present in Watson's ANDA product, however, is immaterial. Novartis has shown
through Dr. Davies's experiments that a measureable amount of peroxide is present, and this is

9

Although not dispositive, the certificate of analysis for the 900A adhesive does not list TAPP as a component.
(JTX 186, p. 2644; Tr. 255: 13-256: 10).

15

sufficient to conclude that Watson's ANDA product is at least a minimally oxidative
environment. 10 Watson also criticizes the Henkel email as informal hearsay from someone who
was never deposed and who did not testify at trial. (D.I. 318, p. 20). In concluding that
Watson's ANDA product contains peroxides, the Court does not rely on the Henkel email alone.
The email is simply one piece of evidence, corroborated by Dr. Davies's experimental findings,
indicating peroxides are present. It should also be noted Watson offered no objection to the
exhibitattrial. (Tr.173:11-174:2).
Residual monomers, a type of free radical generator, are present in Watson's ANDA
product. Henkel's specification document for the 900A adhesive states that "residual levels of
the starting monomers may be present in the final product" because polymerization "is never
100% efficient." (JTX 23, p. 1). There is a section of the specification titled "Residual
Monomers" that lists the maximum specified limits for each monomer that can be present. (Id.).
Some of these limits for the individual monomers are as high as 700 ppm, and if all listed
monomers were present in their maximum specified amounts it would exceed 1500 ppm. (Id.).
Another Henkel document, the certificate of analysis, lists what is actually present in the product,
as opposed to the specification which denotes what is permitted in the product. (Tr. 182:3-13).
The certificate of analysis for the 900A adhesive identified the presence of four residual
monomers at a combined concentration of 606 ppm. (JTX 186, p. 2644; Tr. 182:3-184:12; see
also JTX 30, p. 279745 (reporting 388 ppm ofresidual monomers in a different batch of 900A

adhesive)).
Watson does not substantively dispute that residual monomers are present in its ANDA
products. Instead, Watson contends the amount of residual monomers is insufficient to cause

10

Watson's arguments regarding whether the peroxides have the "power" to oxidatively degrade rivastigmine are
addressed below.

16

rivastigmine degradation, and argues that the presence of residual monomers does not create an
oxidative environment. The first point is addressed in a subsequent section. As for the second
point, Dr. Sessler explained that residual monomers, by themselves, cannot lead to oxidative
degradation. (Tr. 457:3-8). He did admit, however, that residual monomers are an "easy-todetect" surrogate for the corresponding monomer radical. (Id. at 526 :9-15). In order for residual
monomers to form monomer radicals and cause oxidative degradation, "[t]hey would have to
react[, f]or instance, with peroxides, with activated forms of oxygen." (Id. at 458:10-23). As
discussed above, peroxides are present in Watson's ANDA product. The presence ofresidual
monomers working in tandem with other impurities such as peroxides creates an oxidative
environment.
Novartis also alleges that polymerization initiators are present in Watson's ANDA
product. Polymerization initiators are used in the manufacture of polymers, such as the 900A
adhesive, and are capable of creating an oxidative environment. (JTX 23, p. 1; Tr. 421:7-19).
According to Novartis, the "3M Patent Application shows that, in the absence of washing,
residual initiator carries through to the final patches." (D.I. 322, p. 10; see also JTX 17, p. 7
("Such polymerization reactions result in the formation of a polymer along with some level of
unreacted monomers and initiator.")). This argument is not persuasive. 11 Unlike the residual
monomers, the 900A specification does not say anything about residual polymerization initiator
(JTX 23, p. 1), and polymerization initiator is not listed as being present in the certificate of
analysis for the 900A adhesive. (JTX 186, p. 2644; JTX 30, p. 279745). Additionally, Novartis

II Novartis also cites an email from a Henkel employee stating that the 900A adhesive contains residual peroxide
initiator as proof that TAPP is a component in Watson's ANDA product. (JTX 32, p. 285088; D.I. 322, p. 8). The
Court relied on this email when Novartis cited it to show the presence of peroxides because there was other
scientific evidence to corroborate that position. Here, aside from expert testimony and analogies based on other
adhesive systems, the email is the only offered proof Novartis has that Watson's ANDA product contains residual
initiator. It is also worth noting that TAPP is listed in the 900A specification as a monomer scavenger, not an
initiator. (JTX 23, p. 1).

17

did not conduct any testing on the adhesives for Watson's ANDA product to establish the
initiator's presence. It is possible an incomplete polymerization reaction in the 900A polymer
left behind unreacted initiator, as Dr. Klibanov maintained (Tr. 179: 19-181 :20), but more
concrete evidence is required to support that proposition. Reliance by analogy on a different
patent application with a different adhesive is insufficient to prove that initiator in the 900A
polymer adhesive carries over to the finished Watson ANDA product.
In sum, an oxidizing environment can be created by the presence of oxygen, peroxides, or
other free radical generators. In this case, all three types of free radical generators can be found
in Watson's ANDA products. Ambient air is not excluded from the manufacturing environment
for Watson's ANDA products and was found to be present inside Watson's pouches. Dr. Davies
tested the 900A and 905A adhesives and found peroxides, which Dr. Klibanov explained would
be carried forward into Watson's ANDA product because no steps were taken to remove these
impurities. Similarly, the documentation provided by Henkel shows that residual monomers are
present in the 900A adhesive and are not removed prior to the assembly of Watson's ANDA
product. The presence of these three free radical generators constitutes sufficient proof that
Watson's ANDA product is an oxidizing environment.
b. Rivastigmine is susceptible to oxidative degradation in an oxidative
environment
There is no dispute that rivastigmine is susceptible to degradation depending on the
particular environment to which it is exposed. (Tr. 522:23-523:3). As discussed above, the
environment for Watson's ANDA product contains oxygen, peroxides, and residual monomers.
The question becomes whether these substances can oxidatively degrade rivastigmine. The
answer to that question is yes, based on the evidence Novartis put forth regarding the individual

18

and collective effects of oxygen, peroxides, and residual monomers on rivastigmine. Each free
radical generator's effect on rivastigmine will be discussed in turn.
Rivastigmine oxidatively degrades in the presence of oxygen. The patents in suit teach
that rivastigmine in a transdermal device will degrade if exposed to oxygen despite "the
formation of an occlusive polymer matrix around compound A [rivastigmine] and its storage in
air-tight packaging." '031 patent, 1:22-28 ("It has now been found after exhaustive testing that
compound A is susceptible to degradation, particularly in the presence of oxygen."). Novartis's
experiments also showed that oxygen caused degradation to rivastigmine in its bulk form. (JTX
85, p. 2403 ("Rivastigmine base as liquid is very sensitive to oxygen (air) and moisture.
Degradation is accelerated by the influence of heat.")). Indeed, Watson's own documents
acknowledge oxygen's effects on rivastigmine. (JTX 29, p. 29808 ("Rivastigmine is subject to
both hydrolytic and oxidative degradation.")).
Watson relies on a two-prong argument articulated by Dr. Sessler: "[F]or oxidative
degradation to occur, oxygen must have both the 'power' to oxidize rivastigmine and must be
present in a sufficient 'amount.'" (D.I. 318, p. 15). With respect to the first point, Dr. Sessler
explained that molecular oxygen alone is insufficient to oxidatively degrade rivastigmine;
instead, oxygen must react with another substance, such as a metal ion, to form a reactive oxygen
species. (Tr. 443:1-23; id. at 420:1-24). Watson alleges that Novartis's failure to test for these
other substances results in a failure to prove oxidative power. (D.I. 318, p. 15). Second, the
amount of oxygen is important because of its role in the oxidation. Oxygen is not just an
initiator; it is consumed in the reaction and incorporated into the ketone degradation product.
Watson claims to use pressurized nitrogen gas to extrude the adhesives and a roller to squeeze all

19

of the air from its pouches prior to sealing, 12 both of which protect its ANDA product from
oxygen. (Id., p. 16). Therefore, the argument goes, "[ w]ithout knowing the amount of oxygen, if
any, in the adhesive system of the patch itself, it is impossible to determine whether enough
oxygen is present to form the rivastigmine degradants." (Id.).
Dr. Sessler's concerns about oxygen's power to oxidize rivastigmine are overstated.
Regardless of whether oxygen is labeled as a "strong" or "weak" oxidant in the organic
environment, the need to protect the active substance in a transdermal patch from oxygen is well
documented in the literature. ('031 patent, 1:22-28; '498 patent, 1:44-47 ("[T]he stability of the
active substance and of the auxiliaries may be put at risk by reaction with active oxygen. Such
active oxygen is, naturally, the oxygen of the air."); JTX 9, p. 110 (recognizing that oxidation
may "occur spontaneously under the initial influence of atmospheric oxygen"); JTX 188, p.
1507). Even if oxygen is a relatively weak oxidant, as Dr. Sessler testified (Tr. 443:7-23 ("I've
seen no evidence that under the normal conditions of Watson's ANDA product, manufacture,
storage, transport, [and] use, that oxygen is even capable of triggering oxidative degradation....
Oxygen-based oxidation becomes weaker in an organic environment.")), he also conceded that
peroxides and residual monomer radicals, in addition to metal ions, can create activated oxygen
that would have the power to degrade rivastigmine. (Id. at 419:13-420:24 ("I think for oxygen to
do its oxidative degradation, it has to be converted to some sort of active form. . . . Residual
radicals left over perhaps from the polymerization process can trigger that kind of activation.
Peroxides, as we've discussed, can either induce that kind of activation or act as an oxidant on
their own.")). The presence of both peroxides and residual monomers leaves little doubt that

12

The Court agrees with Novartis that it could not find any reference to a roller that squeezes air from the pouches
in the cited portions of Watson's ANDA (D.I. 318, p. 16; D.I. 322, p. 5; JTX 56, pp. 1830, 1834).

20

oxygen has the power required to oxidize rivastigmine in the environment of Watson's ANDA
product.
Watson's second argument also misses the mark because the steps Watson took to
eliminate air from its ANDA product were verifiably ineffective. There was a large enough
volume of gas inside Watson's pouch to form a visible bubble when Dr. Davies rolled up the
patch. (Id. at 340: 15-341 :21 ). Dr. Davies tested this gas with an oxygen meter and found the
presence of oxygen in a concentration similar to that of ambient air. (JTX 54, p. 2; Tr. 340:814). It is highly probable the oxygen in the pouch will enter Watson's ANDA product because
the patch was designed to be breathable. (Tr. 522:13-22). This is affirmed by Watson's
acceleration lifetime studies, which prove that the amount of oxygen in the pouch is sufficient to
oxidize rivastigmine because the ketone degradant is detected after 12 weeks of storage under
normal conditions. 13 (JTX 195, p. 78375 (noting presence of ketone degradant at every time
point from 12 weeks to 78 weeks under normal storage conditions)). When "stressed" conditions
were applied, the ketone degradant appeared after just 4 weeks. (Id.).
Peroxides are also capable of oxidatively degrading rivastigmine, but most likely not at
the levels measured by Dr. Davies. In order to reduce oxidative degradation, the '498 patent
teaches that "an upper peroxide number limit of 20, better still 10, preferably 5, should not be
exceeded." '498 patent, 7:16-17. Dr. Davies measured peroxide values ofless than 2 in
Watson's ANDA product (JTX 53, p. 2), which is well within what Watson describes as the
"safe zone" taught by the '498 patent. (D.I. 318, p. 19). Novartis responds by pointing to a

13

Given that the amount of ketone degradant detected in Watson's stability studies is unchanged over time within
the limits of measurement precision, Watson suggests it could be due to the introduction of a trace impurity prior to
the formation of the ANDA product. (D.1. 318, p. 23 n.14). This argument is unavailing in light of the weight of
direct and circumstantial evidence proffered by Novartis.

21

different section of the '498 patent's specification that states "[a]n additional improvement in
stability may be achieved by the addition of antioxidants," even if "the materials are virtually
free from peroxides." '498 patent, 7:8-12. Given the diverging opinions from two highly
qualified experts (Compare Tr. 189:23-190:13, with Tr. 429:22-430:21), this issue turns on their
respective credibility as evaluated during the trial. The Court finds the teachings of the '498
patent and Dr. Sessler' s trial testimony to be more persuasive. The low level of peroxides is
unlikely to oxidatively degrade rivastigmine.
The fact that the peroxides, by themselves, likely are not present in sufficient quantities to
cause oxidative degradation does not end the inquiry. As Dr. Klibanov noted, all three of the
free radical generators discussed can create an oxidative environment that will lead to the
oxidative degradation ofrivastigmine. (Tr. 189:23-190:13). Peroxides can also react with
oxygen and residual monomers to form activated oxygen and monomer radicals, both of which
can also degrade rivastigmine. The low level of peroxides, therefore, does not alter the Court's
view that rivastigmine is susceptible to degradation in Watson's ANDA product.
Finally, residual monomers, when present with other impurities known to exist in
Watson's ANDA product, have the power to oxidize rivastigmine. Dr. Sessler stated this
himself. (Tr. 458:10-23). As shown above, residual monomers are present in the 900A adhesive
and also in Watson's ANDA product. Watson responds by arguing that the concentration of
residual monomers is not sufficient to cause oxidative degradation. (D.I. 318, pp. 21-22). The
3M patent application, relied on by both parties, states, "The polymerization reaction product is
washed such that the at least two ethylenically unsaturated monomers, if present in the adhesive
as unreacted monomers after washing, are reduce[ d] to a level of less than 200 ppm of total
unreacted monomer, based upon the total weight of the adhesive." (JTX 17, p. 6). The 900A
22

adhesive, which contained 388 and 606 ppm residual monomers in the two certificates of
analysis (JTX 186, p. 2644; JTX 30, p. 279745), represents only 34.7% of the total weight of the
adhesive. (JTX 56, p. 1823). When the residual monomer concentration is adjusted based on the
weight of the total adhesive, as taught in the 3M patent application, the resulting concentrations
in the adhesive bilayer are 134 and 210 ppm, respectively. 14 (D.I. 318, p. 22). Watson contends
that there is no oxidative environment because one value is substantially below the 200 ppm goal
for washed adhesives taught by the 3M patent application, and the other value is only marginally
above it. (Id.).
It is true that the 3M patent application suggests it is desirable to achieve less than 200

ppm of residual monomer by washing the polymerization reaction product. (JTX 17, p. 6).
Although it recognizes that some embodiments may be stable after the washing process without
the need to add an antioxidant, other embodiments will simply require a lesser amount of
antioxidant to attain stability. (Id.). The need for an antioxidant is demonstrated by 3M's own
experiments showing 0.95% oxidative degradation of rivastigmine occurred after two months at
60°C in a copolymer with no antioxidant, despite having a residual monomer concentration
below the detection limit. (Id., pp. 20-22; D.I. 322, pp. 9-10). Although the parties disagree on
whether the level ofresidual monomers in Watson's ANDA product is sufficient to oxidatively
degrade rivastigmine, the Court finds Novartis's position to be more credible.
It is clear that rivastigmine is subject to oxidative degradation in the presence of oxygen,

peroxides, and residual monomers. It is also clear that each of these three free radical sources

14

The concentrations of residual monomer in the adhesive bilayer were obtained by multiplying 34. 7% by the
residual monomer concentration in the 900A adhesive. This appears to assume that there are no residual monomers
in the 905A adhesive, and, for purposes of this argument, the Court follows that assumption.

23

are present in Watson's ANDA products. This leads to the conclusion that Watson's ANDA
products contain an environment in which one would expect rivastigmine to oxidatively degrade.
c. Rivastigmine does not significantly degrade in Watson's ANDA
product and the most likely explanation is that BHT acts as an
antioxidant
Watson's ANDA states that its products exhibit only a "low level of impurities and
degradation products" when subjected to stress tests designed to predict degradation over a
prolonged period of time. (JTX 56, p. 1826; Tr. 698:24-699:9). Based on its choices of
excipients, Watson expected its ANDA product to maintain stability throughout the intended
shelflife. (Id.). Watson's ANDA product also contains BHT. Dr. Kibbe, Watson's obviousness
expert, admitted that the concentration ofBHT claimed in the patents, and present in Watson's
ANDA products, falls within what is "typically used in most pharmaceutical formulations." (Tr.
629:11-24; see also DTX 11, p. 47 (listing typical BHT concentrations for various uses)). This
belies Watson's contention that "Plaintiffs have not presented any evidence that the small
amounts ofBHT at the levels detected by Dr. Davies could reduce oxidative degradation of
rivastigmine in any formulation, much less in the environment of Watson's ANDA product."
(D.I. 318, pp. 6-7). Dr. Klibanov offered the following explanation for the low level of
degradation:
Well, I think that one of skill in the art looking at this question will say [] we have
rivastigmine, which is undeniably susceptible to oxidative degradation. You also
have all this oxidative environment within Watson's adhesive bilayer. We have
oxygen. We have peroxide[ s]. We have residual initiators and monomers. And it's
been shown that each one of those can lead to oxidative degradation [] of
rivastigmine. And nevertheless, there is no significant oxidation of rivastigmine
for a prolonged period of time. So one of skill in the art would look at that data and
say, What is the most likely explanation for that? And [the] most likely explanation
for that is that the BHT, which is undeniably present in the products affords
significant stabilization for rivastigmine.

24

(Tr. 197:10-198:5). 15
Watson criticizes Dr. Klibanov's analysis for incorrectly assuming that using an
antioxidant and excluding oxygen are the only ways to prevent oxidative degradation in a
transdermal product. (D.I. 318, p. 24). For example, Watson points to the '498 patent as
evidence that the risk of oxidative degradation can be avoided by keeping the peroxide value
number below 20--the peroxide value numbers measured by Dr. Davies in the 900A and 905A
adhesives were less than 2. (Id.; '498 patent, 7:14-17). The '498 patent, however, addresses
only oxidative degradation caused by peroxides. Residual monomers are not discussed, and
excluding oxygen is suggested by the '498 patent. '498 patent, 1:44-50. Watson's argument
would be more compelling if its ANDA product contained only peroxides. The facts of this case,
however, are quite different, and Watson's ANDA product has been proven to contain both
oxygen and residual monomers in addition to peroxides. Therefore, the teachings of the '498
patent are not directly on point and cannot support the broad assertion advanced by Watson that,
independent of other impurities, a peroxide value number of less than 20 means oxidative
degradation will be avoided.
Watson relies on the patents in suit for the proposition that trace amounts of free radicals
will not negatively affect rivastigmine's stability. '031 patent, 1:44-46 ("The diluent or carrier
may contain trace amounts of free radicals without affecting the stability of the pharmaceutical

15
Novartis attempts to bolster Dr. Klibanov's opinion with Watson's experimental data on a prototype adhesive, the
9301 adhesive. (D.1. 310, p. 20). Watson conducted a stability test on the 9301 adhesive and found the degradation
of rivastigmine without BHT to be significantly higher than the degradation of rivastigmine with BHT after 67
weeks. (JTX 205, pp. 25917-18 (finding addition ofBHT resulted in between three and five fold decrease in
rivastigmine degradation at both 25 and 40 degrees Celsius)). Watson decided not to pursue the 9301 adhesive, and
it is not used in Watson's ANDA product. (Tr. 203 :3-9). The 9301 adhesive is a very different formulation than the
900A and 905A adhesives: it uses a different polymerization initiator at a different concentration (Compare JTX 32,
p. 285091, with JTX 23, p. 1), and contains vastly different concentrations ofBHT. (Compare JTX 205 p. 25917,
with JTX 41, p. 2). These experiments are certainly relevant in the sense that they demonstrate BHT's effect on
rivastigmine degradation in the 9301 adhesive. The relevance to Watson's ANDA product and this case, however,
is minimal given the number of differences between the adhesives and their constituent components.

25

composition."). It follows, according to Watson, that "the presence of some amount of free
radicals in a transdermal system does not necessarily lead to an oxidative degradation problem."
(D.I. 318, p. 24). The Court disagrees. The patents in suit contain an antioxidant, which assists
in preventing oxidative degradation. It is more reasonable to conclude that the antioxidant
shields rivastigmine from the free radicals' harmful effects than to conclude that free radicals do
not create an oxidative environment. See '031 patent, 1:34-36.
Watson also asserts that Novartis should have performed additional testing. (D.I. 318,
pp. 27-30). This argument is unavailing. The testing and other experimental data Novartis
presented are sufficient to prove infringement by a preponderance of the evidence.
Watson's final argument is that Dr. Sessler's "footprint" hypothesis disproves Novartis's
theory that BHT is acting as an antioxidant in Watson's ANDA product. Dr. Sessler posits that
an antioxidant leaves a characteristic "footprint" involving the ratio of the degradants.
According to the theory, rivastigmine degradation results in two main degradants, a styrene
degradant and a ketone degradant, in approximately a 1: 1 ratio. The styrene degradant forms
first, and it can subsequently be oxidized to form the ketone degradant if an oxygen atom source
is present. Unlike the styrene degradant, which can be formed via a non-oxidative pathway, the
ketone degradant can only be formed through oxidation and consumes an oxygen atom in the
process. The presence of an antioxidant will disrupt the oxidation reaction, blocking the ketone
degradant's formation in the process. Therefore, the theory predicts the presence of a
functioning antioxidant will result in more styrene degradant relative to the ketone degradant.
(D.I. 318, p. 25 (citing various portions of Dr. Sessler's trial testimony)).

26

No experimentation was done to validate the theory, 16 but at trial both parties tested the
theory's predictions by applying it to existing data. Watson supported its theory with a Novartis
stability study on its transdermal device that found more ketone degradant than styrene degradant
when no antioxidant was present, but more styrene degradant than ketone degradant when
various antioxidants were added. (JTX 187, p. 504460). Novartis pointed to its stress tests on
bulk rivastigmine, with no antioxidant present, which did not display the expected 1: 1 ratio. The
temperature and relative humidity were varied in the four experiments, and only one of the four
demonstrated a 1: 1 ratio. (JTX 85, p. 2399). In another Novartis test applying forced conditions
to bulk rivastigmine, researchers observed a ketone to styrene ratio of nearly two-to-one. (Id., p.
2401 ). Dr. Sessler attempted to fit this inconsistency into his theory by hypothesizing that
oxygen is not a limiting reactant for bulk rivastigmine, but is limiting in a polymeric formulation.
(Tr. 491:10-492:14 (citing JTX 195, p. 78375)). If that were the case, more of the ketone
degradant would form with bulk rivastigmine because of the excess oxygen. (Id.). Although
further experimentation may verify Dr. Sessler's theory in due course, the scientific evidence
supporting the theory at this juncture is not robust enough for the Court to place its full faith in it.
Even if the "footprint" theory holds, however, its application to Watson's long-term
stability test appears to be consistent with the presence of an antioxidant. The presence of an
antioxidant, according to the theory, will result in a greater amount of styrene degradant than
ketone degradant. In long-term stability testing done on Watson's ANDA product, the styrene
and ketone degradant appeared in a 3:2 ratio. (JTX 195, p. 78375 (measuring approximately
0.03% styrene to 0.02% ketone by weight at time points between 26 and 78 weeks)). This is

16

The exact rivastigmine degradation pathway underpinning the theory has not been scientifically
established. (Tr. 556: 13-23). Dr. Sessler himself described it as a "wonderful research study" that he did not
conduct. (Id.).

27

entirely consistent with Novartis's contention that Watson's ANDA product contains an acting
antioxidant, namely BHT. Dr. Sessler viewed this study's results differently, contending that the
reported weight percentages were at the limits of precision. (Tr. 490:5-24). Because the
numbers were so small, Dr. Sessler concluded the ratio at each time point was essentially 1: 1 and
that no antioxidant was present in the system. (Id. at 490:5-491 :4). Without knowing the margin
of error in the measurements it is impossible to tell with statistical certainty whether a ratio of
0.03:0.02 is really a 1: 1 ratio. But three data points taken after 78 weeks were measured out to
the thousandths decimal place and resulted in ratios of0.029:0.021, 0.030:0.019, and
0.030:0.021. (JTX 195, p. 78375). All three figures after the decimal point are significant in
each of those measurements, making it more likely that it is a 3:2 ratio. At the very least, based
on the number of significant figures, the Court is not convinced they represent 1: 1 ratios, as Dr.
Sessler urges.
In sum, the Court reaches the same logical conclusion as Dr. Klibanov did.
Rivastigmine, which is susceptible to oxidative degradation, and BHT, an antioxidant, are placed
in a demonstrably oxidative environment, yet no significant degradation is observed over a
prolonged period of time. The most likely explanation, and an explanation that Novartis has
proven by a preponderance of the evidence, is that BHT is acting as an antioxidant to protect
rivastigmine from oxidative degradation over a prolonged period of time.

II. OBVIOUSNESS
Watson asserts claims 2 and 7 of the '023 patent and claims 3, 7, 13, 16, and 18 of the
'031 patent are invalid because the addition of an antioxidant to a rivastigmine transdermal patch
would have been obvious to a person having ordinary skill in the art ("PHOSITA") in January
1998-the priority date. (D.I. 311, pp. 2-5; Tr. 34:6-8). This argument is premised on three

28

major pieces of prior art. The first piece of prior art is a British patent application, GB 2 203 040
A ("GB '040"), which was filed in 1988. GB '040 discloses rivastigmine's use in treating
Alzheimer's disease and suggests a weight percent range of rivastigmine that would be effective
in a transdermal device. (JTX 97, pp. 281395-97, 281408-11). The only limitation of the '023
and '031 patents' asserted claims not disclosed by GB '040 is the addition of an antioxidant. The
second prior art reference is U.S. Patent No. 4,948,807 ("the '807 patent"), which issued in 1990.
The purpose of the '807 patent is to identify alternatives to physostigmine, an
acetylcholinesterase inhibitor used in the treatment of Alzheimer's disease that had several
disadvantages, including chemical instability. '807 patent, 3:37-48. The '807 patent teaches that
sterile injectable formulations of the "compounds of the invention," including the racemate RA1,
can incorporate an antioxidant. Id., 7:15-53. The third piece of prior art is a scientific paper
written in 1991 by Elmalem et al. The Elmalem article compared the effects of three new antiacetylcholinesterase agents, one of which was RA1, with that of physostigmine. (JTX 159, p.
1059). The "Methods" section described the preparation of the drugs in a saline solution with
metabisulphite, a known antioxidant. (Id., p. 1060).
Novartis counters that Watson failed to show by clear and convincing evidence that: a
PHOSITA would have chosen GB '040's rivastigmine transdermal formulation as a starting
point, rivastigmine was known in the art to be susceptible to oxidative degradation, and the use
of an antioxidant would have been a predictable solution to rivastigmine' s oxidative degradation
problem. (D.I. 317, p. 7).
The obviousness inquiry must be conducted from the PHOSITA's point of view. The
parties agree the PHOSITA has an advanced degree in pharmaceutics, chemistry, pharmaceutical
chemistry, materials engineering, or the like, and at least two years of experience developing

29

pharmaceutical formulations. A PHOSITA could also possess a Bachelor's or Master's degree,
provided the PHOSITA has practical experience working in the industry, or academia, for a
longer period of time. (Tr. 589:1-590:3; id. at 817:13-818:21).

A. Legal Standard
The presumption that all patents are valid is the starting point for any obviousness
determination. 35 U.S.C. § 282 (2012). Under§ 103(a), a patent "may not be obtained ... ifthe
differences between the subject matter sought to be patented and the prior art are such that the
subject matter as a whole would have been obvious at the time the invention was made to a
person having ordinary skill in the art." Id. § 103(a). Obviousness is a question oflaw that
depends on the following factual inquiries: (1) the scope and content of the prior art; (2) the
differences between the claims and the prior art; (3) the level of ordinary skill in the relevant art;
and (4) any objective considerations such as commercial success, long felt but unsolved need,
and the failure of others. See Transocean Offshore Deepwater Drilling, Inc. v. Maersk Drilling
USA, Inc., 699 F.3d 1340, 1347 (Fed. Cir. 2012). The improvement over the prior art must be
"more than the predictable use of prior art elements according to their established functions."
KSR Int'! Co. v. Teleflex Inc., 550 U.S. 398, 417 (2007).
To prove obviousness, Watson must show that a PHOSITA would be motivated to
combine the claimed combinations with a reasonable expectation of success. Allergan, Inc. v.
Sandoz Inc., 726 F.3d 1286, 1291 (Fed. Cir. 2013). Evidence of obviousness, especially when
that evidence is proffered in support of an "obvious-to-try" theory, is insufficient unless it
indicates that the possible options skilled artisans would have encountered were "finite," "small,"
or "easily traversed," and "that skilled artisans would have had a reason to select the route that
produced the claimed invention." In re Cyclobenzaprine Hydrochloride Extended-Release

30

Capsule Patent Litig., 676 F.3d 1063, 1072 (Fed. Cir. 2012). Obviousness must be proven by
clear and convincing evidence. Id. at 1078.

B. Findings of Fact
1. GB '040, the '807 patent, and the Elmalem article are all prior art.
2. The use ofrivastigmine in a transdermal patch to treat Alzheimer's disease
was known.
3. Rivastigmine was not known to be susceptible to oxidative degradation.
4. Neither the '807 patent nor the Elmalem article teach a PHOSITA that
rivastigmine is susceptible to oxidative degradation.
5. It would not have been obvious to a PHOSITA to combine an antioxidant with
rivastigmine in a transdermal patch.

C. Conclusions of Law
Watson contends a PHOSITA would have been motivated to develop a rivastigmine
transdermal patch based on the teachings of GB '040, the closest piece of prior art to the patents
in suit. GB '040 documents rivastigmine's efficacy in the treatment of Alzheimer's disease, and
discloses therapeutic benefits that can be obtained through the use of a transdermal formulation.
The '807 patent and the Elmalem article disclose the combination ofRA1 17 with an antioxidant,
which teaches a PHOSITA that RA1 is susceptible to oxidative degradation and recognizes the
addition of an antioxidant as a solution to the problem. Therefore, Watson contends, a
PHOSITA seeking to improve upon the rivastigmine transdermal device of GB '040, or any
other rivastigmine formulation, would have conducted routine stability testing and would have
been motivated to add an antioxidant if any oxidative degradation were identified.

17

Dr. Klibanov agrees the stability ofRA7 and rivastigmine is identical. (Tr. 896:2-5 ("[T]he Court will
remember that stability toward oxidative degradation ofrivastigmine[] and RA1 is the same, and it's not a
controversial issue.")).

31

This argument is a logical one, but it overstates the teachings contained in these prior art
references. Neither the '807 patent nor the Elmalem article teach a PHOSITA that rivastigmine
is susceptible to oxidative degradation. These references certainly disclose that an antioxidant
can be added to RA1, but there is no accompanying suggestion that RA1 is susceptible to

oxidative degradation or that an antioxidant is needed. Without a motivation to add an
antioxidant to the rivastigmine transdermal device disclosed in GB '040, Watson's obviousness
case falls short.
1. GB '040
As discussed briefly above, GB '040 discloses many limitations of the claims at issue. It
discusses both the free base and acid addition salt forms of rivastigmine (JTX 97, pp. 281396-97)
and recognizes rivastigmine's ability for "marked and selective inhibition of the
acetylcholinesterase" (id., p. 281397), which makes it useful for the treatment of Alzheimer's
disease. (Id., p. 281395). GB '040 also acknowledges some advantageous aspects of
transdermal delivery 18 with respect to drug tolerability including "long-lasting and constant
inhibition of acetylcholinesterase activity" and a "slow onset of action." (Id., p. 281408).
Finally, GB '040 discloses a therapeutically effective dose of rivastigmine, for example "about 1
to about 20 % by weight of active agent" (id., p. 281411 ), which falls within the range of the
asserted claims, and it discusses the use of a diluent or carrier. (Id.). Both parties' experts agree
GB '040 did not disclose or otherwise suggest that rivastigmine, in any formulation, was
susceptible to oxidative degradation. (Tr. 710:16-711 :5; id. at 834:16-24).

18

Although GB '040 highlights several benefits oftransdennal formulations, that cannot be fairly characterized as
the patent application's main purpose. The virtues of other formulation methods were also discussed (JTX 97, p.
281398), and the central innovation of GB '040 is the "surprising[]" and "unexpected" discovery ofrivastigmine's
selective inhibition of acetylcholinesterase. (Id., p. 281397).

32

A PHOSITA would not have been motivated to include an antioxidant in any formulation
unless there was evidence of oxidative degradation. Excipients, including antioxidants, are
inactive ingredients of a pharmaceutical composition that are added to ensure the drug performs
its function in a desirable fashion. (Id. at 836:22-837: 18). The excipients themselves offer no
therapeutic benefit. (Id. at 837:11-18). In fact, excipients can be incompatible with the drug or
other excipients in the pharmaceutical composition, which could lead to a deleterious effect on
the drug's performance. (Id. at 838:22-840:12 (quoting JTX 188, p. 1507)). The compatibility
of an excipient with a given pharmaceutical composition cannot be predicted without
experimentation because of the numerous possible chemical reactions. (Id. at 841 :21-842:3).
For this reason, the European Agency for the Evaluation of Medicinal Products-the FDA's
European equivalent-instructed, "Antioxidants should only be included in a formulation if it
has been proved that their use cannot be avoided." (JTX 105, p. 2).
Moreover, oxidative degradation is not the only degradation pathway; there were many
known types of degradation at the time of the invention. These include hydrolysis, reduction,
racemization, photolysis, and pyrolysis. (Tr. 812: 10-17; id. at 825:21-826:9). But not every
drug in every formulation is susceptible to all types of degradation, and, due to the risk of
incompatibility discussed above, a PHOSITA would not have added an excipient to prevent each
of these types of degradation. A PHOSITA would only be motivated to address and correct
known degradation problems. (Id. at 811:19-812:9). Because GB '040 was silent with respect to
rivastigmine's instability, this motivation would have had to come from some other prior art
reference.

33

2. The '807 Patent
Although the '807 patent does disclose the addition of an antioxidant to RA1, it does not
teach a PHOSITA that RA1 oxidatively degrades. The purpose of the '807 patent is to identify
alternatives to physostigmine, an anti-acetylcholinesterase that lacked the desired chemical
stability. '807 patent, 3:37-39. The patent discloses a general formula for a large number of
phenyl carbamate compounds-in excess of 8 million (Tr. 847:23-848:16)-several of which
were selected for further testing, including RA1. '807 patent, 4:21-53; id., tbls. 1-3. RA1 is one
of the compounds identified and later claimed by the '807 patent. The '807 patent discusses the
use ofRA1 in tablets, capsules, and elixirs for oral administration, as well as sterile solutions and
suspensions for parenteral administration. Id., 7: 15-19. Among the "adjuvants" that can be used
with tablets and capsules are: binders, excipients, disintegrating agents, lubricants, sweetening
agents, and flavoring agents. Id., 7:27-35. The patent provides similar, shorter lists of adjuvants
for capsules and elixirs. Id., 7:35-44. For sterile compositions, however, the '807 patents states,
"Buffers, preservatives, antioxidants and the like can be incorporated as required." Id., 7:45-50.
The patent then lists several preferred antioxidants.
At first glance, this statement appears to support the proposition for which Watson cited
it: namely, that it teaches a PHOSITA that RA1 is susceptible to oxidative degradation and needs
an antioxidant to maintain stability. But despite the laundry list of compounds that "can be
incorporated," there is no specific example in the '807 patent combining RA1 with an
antioxidant. (Tr. 719:16-720:14). Moreover, the '807 patent disclosed the addition of an
antioxidant "as required," yet nothing in the '807 patent suggests RA1 requires an antioxidant (id.
at 718:20-719:15; id. at 861 :5-862:3), and there is no discussion of the appropriate amount of
antioxidant, ifrequired, that should be used for any of the compounds. (Id. at 862:6-13). There

34

is no mention of any observed oxidative degradation ofRA1, and the patent contains no stability
data. (Id. at 715:24-716:22; id. at 863:2-24). To the extent stability is mentioned in the '807
patent, it portrays RA1 and the other compounds of the invention in a positive light. See '807
patent, 11:26-35 (positing that the superior in vivo potency of the compounds of the invention
may be due to their greater chemical stability relative to physostigmine); id., 3:37-39
(recognizing one of the patent's purposes as "provid[ing] new carbamate derivatives which show
greater chemical stability than physostigmine"). Finally, it is worth noting that the patent
examiner for the '023 and '031 patents considered both the '807 patent and U.S. Patent No.
5,602,176, which is the American equivalent of GB '040. (JTX 3, pp. 1063, 1083; JTX 4, p.
914; Tr. 830:4-831:14; see also Sciele Pharma Inc. v. Lupin Ltd., 684 F.3d 1253, 1260 (Fed. Cir.
2012) (explaining that "whether a reference was before the PTO goes to the weight of the
evidence," and "it may be harder to meet the clear and convincing burden when the invalidity
contention is based upon the same argument on the same reference that the PTO already
considered")). When reading this reference as a whole, it would not teach a PHOSITA that an
antioxidant was required to protect rivastigmine from oxidative degradation. 19
3. The Elmalem Article
The Elmalem article also fails to teach a PHOSITA of rivastigmine' s susceptibility to
oxidative degradation. Elmalem compares the effects of three phenyl carbamate compounds
with physostigmine on the morphine-induced respiratory depression in rabbits. (JTX 159, p.
1059). One of the phenyl carbamate drugs tested was RA1. The key sentence is found in the

19
Unlike the other asserted claims, which Waston argues are obvious in light of GB '040 in combination with other
prior art references, Watson asserts claim 16 of the '031 patent would be obvious in light of the '807 patent alone
and claim 18 of the '031 patent would be obvious in light of the '807 patent and The Handbook ofPharmaceutical
Excipients. Because the '807 patent does not teach a PHOSITA that rivastigmine is susceptible to oxidative
degradation and requires the protection of an antioxidant to maintain stability, its statement that an antioxidant can
be incorporated as required does not render the method in claims 16 or 18 of the '031 patent obvious.

35

"Methods" section of the paper, which states: "All drugs were made up freshly in sterile saline,
which included an equal weight of sodium metabisulphite, to prevent oxidation." (Id., p. 1060).
To Watson, this unequivocally "taught one of ordinary skill that rivastigmine was susceptible to
oxidative degradation and to add an antioxidant to the pharmaceutical composition to prevent it."
(D.I. 311, p. 13).
Novartis's interpretation ofthis passage is more nuanced and decisively divergent.
According to Dr. Klibanov, the Elmalem article reports the findings of a well-controlled
experiment, i.e., one in which any variability that can be eliminated is eliminated. The stated
purpose of the Elmalem paper was to compare the effects of three new agents with that of
physostigmine. (JTX 159, p. 1059). The simplest way to conduct this experiment would be to
prepare aqueous solutions of these four compounds and compare their effects when injected into
rabbits. (Tr. 887:20-888:5). The problem with this experiment's design is physostigmine's welldocumented lack of stability in aqueous solution. ('807 patent, 1 :32-34 ("[Physostigmine] is
chemically unstable and must be prepared in solution with an antioxidant, and protected from
light."); JTX 148, p. 1266 ("Physostigmine is not stable in aqueous solution."); JTX 159, p. 1059
(recognizing physostigmine's "low chemical stability" as a serious disadvantage); Tr. 888:6-9).
The instability can be remedied by adding an antioxidant to the physostigmine solution. (Tr.
888:10-11). If, however, the experiment were conducted with physostigmine and an antioxidant
injected into one rabbit, and the other three compounds, without an antioxidant, injected into
three other rabbits, there would be no way to determine whether any observed difference in the
rabbits' respiratory depression was attributable to the relative chemical activity of the drug or to
the presence of the antioxidant. (Id. at 888:15-20). The authors of the Elmalem article addressed
this concern by adding an antioxidant to all of the drug formulations, including the saline

36

placebo. (Id. at 889:5-14; id. at 891 :6-11 ). When read in this context, the statement, "All drugs
were made up freshly in sterile saline, which included an equal weight of sodium metabisulphite,
to prevent oxidation," is better understood as a measure to reduce variability than a teaching that
RA1 is subject to oxidative degradation. 20 Indeed, the Elmalem paper did not disclose any

stability data for RA1. As such, the Elmalem paper would not have motivated a PHOSITA to
combine an antioxidant with the transdermal rivastigmine device disclosed by GB '040.
Watson criticizes this "tortuous interpretation" of Elmalem as an attempt to avoid its
plain teaching. (D.1. 323, pp. 10-11). First, Dr. Klibanov's reading ofElmalem requires both
that saline be considered a drug and that an antioxidant be added to the saline as a control. (Id. at
10). Saline is not mentioned as a drug in the "Drugs" section of the paper, and it does not make
sense that "[a]ll drugs were made up freshly in sterile saline" if the authors considered saline
itself to be a drug. (JTX 159, p. 1060; D.I. 323, p. 10). The article summary in Elmalem,
however, states, "Each drug, RA6, (1 mg i.v., 2 mg s.c.) RA1 (1 or 2 mg i.v.); RA1s (0.25 or 0.5
mg i.v.), physostigmine (0.05 or 0.1 mg i.v.) or saline (1 ml), was injected simultaneously with
morphine (8 mg i.v.) to groups of 6-10 rabbits." (JTX 159, p. 1059 (punctuation as in original)).
The Court accepts Novartis's argument that this passage indicates the study's use of the word
"drugs" includes RA6, RA1, RA1s, physostigmine, and saline, with saline acting as a placebo.
(Tr. 886:5-16). It is also logical to conclude that the Elmalem authors added an antioxidant to
saline, even though it has no stability issues, because it reduces one of the variables in the
experiment. (Id. at 888:10-889:2).

20

Dr. Klibanov argues that the chemical structure of RA1 and physostigmine bolsters his reading of Elmalem.
Physostigmine is a monomethyl carbamate, whereas RA1 is a dialkyl carbamate. (D.I. 317, p. 20). The former is
unstable in aqueous solution, but the latter is not. (Tr. 879:21-882:21; JTX 147, p. 133; JTX 146, pp. 616-17). A
PHOSITA reading Elmalem would appreciate the structural difference between the two drugs and would not have
expected RA1 to oxidatively degrade in aqueous solution. (Tr. 884:4-15). Therefore, the argument goes, it is more
likely that the antioxidant was added as a control than to protect RA1 from oxidative degradation.

37

Second, Watson contends that under Dr. Klibanov's interpretation, the methodology of
Elmalem would not be reproducible because a PHOSITA would not know how much antioxidant
to add to the saline solution. (D.I. 323, pp. 10-11 ). In fact, Dr. Klibanov testified that he did not
know how much antioxidant was used in any of the formulations. (Tr. 933:6-12). To Dr. Kibbe,
the sentence, "drugs were made up freshly in sterile saline, which included an equal weight of
sodium metabisulphite," instructs a PHOSITA to add an amount of antioxidant to each drug
formulation that is equivalent to the weight of the drug in that solution. (Id. at 664:13-665:13).
This tells a PHOSITA how much antioxidant to add to each formulation, but it introduces a new
variable because a different amount of antioxidant would be present in each of the injectable
formulations. 21 (Id. at 891: 15-892: 10).
This second issue was hotly contested at trial. One seemingly innocuous sentence has
given rise to diametrically opposed interpretations, neither of which is without its criticisms.
There does not appear to be an objectively "correct" reading; rather both arguments seem logical
and are supported by highly qualified experts in the field. Instead of attempting to explain
scientifically why one explanation is superior to the other, the better method for resolving this
dispute is based on credibility. To that end, the position advanced by Novartis better comports
with the Court's understanding of Elmalem, and the Court credits Novartis's accompanying trial
testimony as being more credible. Watson has not convinced the Court, by clear and convincing
evidence, that Dr. Klibanov's view of the Elmalem article is incorrect. Therefore, the Court
accepts Dr. Klibanov's argument on this point, and adopts it as the Court's finding of fact.

21

The authors in Elmalem did not use the same concentration of each drug in the experiment.

38

4. Watson's Other Prior Art References
Watson also relies on U.S. Patent No. 5,580,572 ("the '572 patent") and The Handbook
ofPharmaceutical Excipients, Second Edition (DTX 7) as prior art references that can be

combined with GB '040 to invalidate several of the asserted claims. The '572 patent discloses a
transdermal matrix system for delivering hormones. It teaches the inclusion of an antioxidant,
within the concentration ranges claimed in the patents in suit, to stabilize the polymer matrix.
('572 patent, 4:47-52, 16:23; Tr. 648:18-649:18). According to Watson, this would have
instructed a PHOSITA that antioxidants could be used to stabilize the polymer in a polymer
matrix. (D.I. 311, p. 15). The '572 patent may indeed teach a PHOSITA that, but Watson has
not shown any motivation for the PH OS ITA to combine GB '040 with the '572 patent. When
discussing the transdermal administration of rivastigmine, GB '040 specifically cites to the
hydrophilic polymers described in European Patent Application 0 155 229 ("EP '229"). (JTX
97, p. 281411). The transdermal devices in EP '229 do not suggest using an antioxidant. (JTX
109; Tr. 734:17-22). Additionally, rivastigmine is not mentioned in the '572 patent, and the
hormones in the '572 patent share no chemical or structural similarities with rivastigmine. (Tr.
733:5-11).
The Handbook ofPharmaceutical Excipients provides guidance on what antioxidants are
suitable for inclusion in pharmaceutical compositions and suggests typical concentration ranges
for each antioxidant. (Tr. 631 :5-632:21; see, e.g., DTX 7, p. 12). The Handbook discloses the
antioxidants claimed in the patents in suit, in amounts that fall within the claimed concentration
ranges. (Tr. 630:14-644:22). Watson asserts a PHOSITA seeking to add an antioxidant to a
transdermal rivastigmine formulation would have referred to the Handbook. It is true that the
Handbook discloses the antioxidants claimed, but absent a reason to believe an antioxidant was

39

required for a rivastigmine formulation, a PHOSITA would not be motivated to consult the

Handbook. Because the Court has concluded that nothing in the prior art disclosed
rivastigmine' s susceptibility to oxidative degradation, a PH OSITA would have no reason to
combine the Handbook's teachings with any other prior art reference.
In conclusion, the obviousness determination in this case turns on whether a PHOSITA in

January 1998, looking at all of the prior art, would have known rivastigmine was susceptible to
oxidative degradation. If the answer is yes, the asserted claims of the '023 and '031 patents are
invalid because the addition of an antioxidant to a pharmaceutical composition that oxidatively
degrades is one of several known, obvious solutions. See KSR, 550 U.S. at 421 ("When there is
a design need or market pressure to solve a problem and there are a finite number of identified,
predictable solutions, a person of ordinary skill has good reason to pursue the known options
within his or her technical grasp. If this leads to the anticipated success, it is likely the product
not of innovation but of ordinary skill and common sense."). If the answer is no, then the
discovery that rivastigmine oxidatively degrades and the solution to that problem are an
inventive contribution worthy of patent protection. There can be no motivation to combine prior
art references to solve a problem that no one knows exists. Id. at 418 ("Although common sense
directs one to look with care at a patent application that claims as innovation the combination of
two known devices according to their established functions, it can be important to identify a
reason that would have prompted a person of ordinary skill in the relevant field to combine the
elements in the way the claimed new invention does."). Because I find that a PHOSITA would
not have appreciated rivastigmine's susceptibility to oxidative degradation in January 1998,
Watson has not proven obviousness by clear and convincing evidence.

40

III. CONCLUSION
Novartis proved Watson's ANDA products infringe claims 2 and 7 of the '023 patent and
claims 3, 7, 13, 16, and 18 of the '031 patent by a preponderance of the evidence. Watson failed
to prove by clear and convincing evidence that any of the asserted claims of the '023 or '031
patents were invalid. Novartis should submit an agreed upon form of final judgment within two
weeks.

41