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1 August 2018Americas

Federal Circuit remands PTAB decisions in light of SAS ruling

The US Court of Appeals for the Federal Circuit has ordered the Patent Trial and Appeal Board (PTAB) to reconsider its assessments in three inter partes reviews (IPRs), in the wake of the US Supreme Court’s SAS Institute v Iancu decision.

Circuit Judge Pauline Newman delivered the ruling on Tuesday, July 31.

The three IPRs were requested by BioDelivery Sciences International, a pharmaceutical company focussing on addiction and pain treatments. It challenged 22 claims of US patent number 8,765,167 on the grounds of unpatentability, and the PTAB instituted a review of 15 of them.

In two other IPRs, the board elected to assess some, but not all, of the claims challenged by BioDelivery.

The challenged patents are owned by Aquestive Therapeutics, a pharmaceutical company that develops and commercialises products to address unmet needs. The patents cover water-soluble films that are used to encase drugs.

At the PTAB, all instituted claims of the patents were upheld as valid.

BioDelivery appealed against the decisions, and the Federal Circuit heard oral arguments in the three appeals in February this year.

However, in April, the Supreme Court issued its decision in SAS Institute.

In the long-awaited judgment, the highest court in the US confirmed that the PTAB cannot choose to review only some challenged claims in an IPR—it must assess all  the claims once it decides to institute a review.

After the decision in SAS, BioDelivery asked the Federal Circuit to remand the three IPRs to the PTAB and instruct it to consider all claims of the patent in accordance with the recent Supreme Court decision.

In response, Aquestive claimed that BioDelivery had waived any right to seek relief under the SAS decision. The company noted that BioDelivery had failed to complain about the PTAB’s decision not to institute a review of all challenged claims at the time, or on appeal.

Aquestive also asked the court to prevail in dealing with the “presently appealed issues”, even if it elects to remand the PTAB decision.

The Federal Circuit said that post-SAS cases have already held that it is “appropriate” to remand matters back to the PTAB for the board to consider non-instituted claims.

It confirmed that BioDelivery had not waived its right to have SAS-based relief simply because it failed to argue against partial institution at the PTAB.

“SAS represented a significant change in law that occurred during the pendency of BioDelivery’s appeals,” Newman said.

Therefore, attempts to argue against partial institution before the decision would have been “futile” under the PTAB’s regulations at that time, she explained.

Newman said the “inadequacy” of the three PTAB decisions in question must be addressed before any other issues raised on appeal are considered, in order to avoid “piecemeal litigation that is historically disfavoured”.

The Federal Circuit vacated the PTAB’s three decisions in the IPRs and remanded them so that the board can implement the Supreme Court’s decision in SAS.

Newman said that each party would bear its own costs.

Speaking to LSIPR, a spokesperson for Aquestive said the Federal Circuit's decision was procedural and did not address the merits of the PTAB’s earlier decision which upheld the validity of the '167 patent.

"We are confident that the PTAB’s decision was correct, and that any further proceedings at the PTAB will lead to the same result upholding the validity of the patent,” the spokesperson added.

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