United States Court of Appeals
for the Federal Circuit
__________________________
TEVA PHARMACEUTICAL INDUSTRIES LTD.,
Plaintiff-Appellant,
v.
ASTRAZENECA PHARMACEUTICALS LP
AND IPR PHARMACEUTICALS INC.,
Defendants-Appellees.
__________________________
2011-1091
__________________________
Appeal from the United States District Court for the
Eastern District of Pennsylvania in case no. 08-CV-4786,
Judge William H. Yohn, Jr.
__________________________
Decided: December 1, 2011
__________________________
JEFFREY D. BLAKE, Sutherland, Asbill & Brennan,
LLP, of Atlanta, Georgia, argued for plaintiff-appellant.
With him on the brief was DAVID A. REED.
ERIC J. FUES, Finnegan, Henderson, Farabow, Garrett
& Dunner, LLP, of Washington, DC, argued for defen-
dants-appellees. With him on the brief were FORD F.
FARABOW, JR. and RAMA G. ELLURU; and CHARLES E.
LIPSEY, of Reston, Virginia. Of counsel on the brief were,
2 TEVA PHARMA v. ASTRAZENECA PHARMA
JAMIE B. BISCHOFF and MARC J. WEINSTEIN, Ballard
Spahr, L.L.P., of Philadelphia, Pennsylvania, and JUDY
YUN, AstraZeneca Pharmaceuticals, LP, of Wilmington,
Delaware.
__________________________
Before RADER, Chief Judge, LINN and DYK, Circuit
Judges.
LINN, Circuit Judge.
Teva Pharmaceutical Industries Ltd. (“Teva”) appeals
from the Eastern District of Pennsylvania’s entry of
summary judgment in favor of AstraZeneca Pharmaceuti-
cals LP and IPR Pharmaceuticals Inc. (collectively “As-
traZeneca”) invalidating claims 1, 26, 42, and 52
(“asserted claims”) of Teva’s U.S. Patent No. RE39,502
(“’502 patent”) based on AstraZeneca’s prior invention of
the subject matter claimed therein. Because the district
court correctly concluded that AstraZeneca’s earlier
development of the accused CRESTOR® drug (“Astra-
Zeneca’s drug”) formulation satisfied the requirements for
prior invention under 35 U.S.C. § 102(g)(2), this court
affirms.
I. BACKGROUND
Statins are a class of compounds useful in the treat-
ment of dyslipidemia. Statins are inherently unstable
and, to be medically viable, must be manufactured in
stabilized formulations. As relevant to this appeal, Teva’s
’502 patent is directed to statin formulations stabilized
exclusively by an amido-group containing polymeric
compound (“AGCP compound”) or by an amino-group
containing polymeric compound. The ’502 patent is a
reissue of a patent that claims the benefit of a provisional
application filed on April 10, 2000. The earliest date by
which Teva asserts that it conceived and reduced to
TEVA PHARMA v. ASTRAZENECA PHARMA 3
practice its claimed invention is December 1, 1999. Claim
1 of the ’502 patent is representative of the asserted
claims and recites:
1. A stabilized pharmaceutical composition for
the treatment of dyslipidemia,
comprising
an active component consisting essentially
of one or more compounds selected from
the group consisting of (i) an IIMG-CoA
reductase inhibiting ring-opened 7-
substituted-3,5-dihydroxyheptafloic acid
or a pharmaceutically acceptable acid
salt thereof, and (ii) an HMG-CoA reduc-
tase inhibiting ring-opened 7-
substituted-3,5-dihydroxyheptenoic acid
or a pharmaceutically acceptable acid
salt thereof, and
a stabilizing effective amount of at least one
amido-group containing polymeric com-
pound or at least one amino-group con-
taining polymeric compound, or
combination thereof, wherein said stabi-
lized pharmaceutical composition does
not contain a stabilizing effective amount
of another stabilizer or a combination of
other stabilizers.
’502 patent col.16 ll.17-33 (underlining added, italics in
original).
In October 2008, Teva sued AstraZeneca for infringing
the ’502 patent based on AstraZeneca’s manufacture and
sale of the AstraZeneca drug, a stabilized statin (rosuvas-
tatin calcium) formulation for the treatment of dyslipide-
mia. This drug was designed with tribasic calcium
phosphate, which is not an AGCP compound, as a stabi-
lizer. The drug also contains crospovidone, which is an
4 TEVA PHARMA v. ASTRAZENECA PHARMA
AGCP compound. It is uncontested that AstraZeneca
included crospovidone in the AstraZeneca formulation as
a disintegrant, but did not understand crospovidone to
have a stabilizing effect.
AstraZeneca moved for summary judgment of invalid-
ity under 35 U.S.C. § 102(g)(2) alleging that it had con-
ceived and reduced its drug to practice prior to Teva’s first
conception of the claimed subject matter. AstraZeneca
made an undisputed showing that, in mid-1999, it manu-
factured a 10,000-unit batch of a rosuvastatin calcium
formulation containing the same ingredients in the same
amounts as its commercial drug. AstraZeneca made
additional batches of rosuvastatin calcium in the summer
and fall of 1999, also with the same ingredients in sub-
stantially the same amounts as the commercial drug. By
late summer 1999, AstraZeneca had disclosed the ingredi-
ents and quantities for its rosuvastatin formulation
matching those of all commercial drug dosage strengths.
On the basis of these undisputed facts, the district court
found that “there is no genuine issue of material fact as to
whether AstraZeneca arrived at the same [AstraZeneca
drug] product formulations that Teva accuses of infringe-
ment—and made batches of those formulations—before
Teva conceived of or reduced to practice the subject mat-
ter of the ’502 patent.” Teva Pharm. Indus. Ltd. v. Astra-
Zeneca Pharm. LP, 748 F. Supp. 2d. 453, 464 (E.D. Pa.
2010).
Notwithstanding the inclusion of tribasic calcium
phosphate—a non-AGCP-compound—as a stabilizer in
AstraZeneca’s drug, AstraZeneca conceded infringement
for the limited purpose of advancing its summary judg-
ment motion. Explaining that “an appreciation of the
stabilizing effect of crospovidone by AstraZeneca, as
opposed to its appreciation of the stabilization of its
overall pharmaceutical composition that contained cro-
spovidone, was not required,” id. at 469, the district court
TEVA PHARMA v. ASTRAZENECA PHARMA 5
granted AstraZeneca’s motion and held the asserted
claims invalid over AstraZeneca’s prior invention of its
drug. Teva timely appealed and this court has jurisdic-
tion pursuant to 28 U.S.C. § 1295(a)(1).
II. DISCUSSION
A. Standard of Review
Summary judgment is granted “if the movant shows
that there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of
law.” Fed. R. Civ. P. 56(a). “This court reviews the dis-
trict court’s grant or denial of summary judgment under
the law of the regional circuit.” Lexion Med., LLC v.
Northgate Techs., Inc., 641 F.3d 1352, 1358 (Fed. Cir.
2011). The Third Circuit “review[s] an order granting
summary judgment de novo, applying the same standard
used by the District Court.” Azur v. Chase Bank, USA,
Nat’l Ass’n, 601 F.3d 212, 216 (3d Cir. 2010) (quotation
omitted). “Priority, conception, and reduction to practice
are questions of law which are based on subsidiary factual
findings.” Cooper v. Goldfarb, 154 F.3d 1321, 1327 (Fed.
Cir. 1998). This court exercises plenary review of the
district court’s legal conclusions regarding the require-
ments of 35 U.S.C. § 102(g), applying Federal Circuit
precedent. See Research Corp. Techs., Inc. v. Microsoft
Corp., 536 F.3d 1247, 1255 (Fed. Cir. 2008) (“The Federal
Circuit applies its own law with respect to issues of sub-
stantive patent law and certain procedural issues pertain-
ing to patent law . . . .” (citations omitted)).
B. Arguments on Appeal
On appeal, Teva essentially argues that the district
court misapplied § 102(g)(2) in failing to require Astra-
6 TEVA PHARMA v. ASTRAZENECA PHARMA
Zeneca to prove that it appreciated the stabilizing effect of
crospovidone in its drug formulation. According to Teva,
the district court implicitly construed the claims to en-
compass stabilized statin formulations containing an
AGCP compound, irrespective of whether the AGCP
compound acted as the sole stabilizer. The thrust of
Teva’s argument is that this overbroad “construction” of
the asserted claims effectively relieved AstraZeneca of its
burden of proving that it created the claimed subject
matter and appreciated that it had done so. Teva also
argues that the district court improperly applied inher-
ency precedent from the § 102(b) context, thus further
obviating AstraZeneca’s need to prove appreciation.
Finally, Teva argues that, if AstraZeneca was the first to
invent, then the district court erred by not finding that
AstraZeneca had suppressed or concealed its invention by
failing to disclose that crospovidone stabilized Astra-
Zeneca’s drug.
AstraZeneca responds that the district court correctly
refused to require AstraZeneca to prove that it appreci-
ated the stabilizing effect of crospovidone. According to
AstraZeneca, Teva’s claim construction argument is
irrelevant because AstraZeneca’s limited concession of
infringement established that AstraZeneca’s drug falls
within the scope of the asserted claims. AstraZeneca
argues that § 102(g)(2) does not require it to understand
its own invention in the same terms in which Teva later
claimed it, but only to understand the fact of what it
made. AstraZeneca also argues that inherency does apply
in the § 102(g) context and that AstraZeneca was not
required to recognize inherent properties of its invention.
Finally, AstraZeneca responds that Teva’s “suppression or
concealment” argument falls with its “appreciation”
argument because, if AstraZeneca was not required to
appreciate that crospovidone was a stabilizer, then it
cannot have been required to disclose that it was.
TEVA PHARMA v. ASTRAZENECA PHARMA 7
C. AstraZeneca’s Prior Invention
Because AstraZeneca conceded infringement for the
limited purpose of its summary judgment motion, and
because Teva maintains the allegation of infringement
upon which its suit is based, it is undisputed for the
purpose of this appeal that AstraZeneca’s drug is an
embodiment within the scope of the asserted claims. See
Evans Cooling Sys., Inc. v. Gen. Motors Corp., 125 F.3d
1448, 1451 (Fed. Cir. 1997) (“Although [defendant] bore
the burden of proving that the [asserted prior art/accused
product] embodied the patented invention or rendered it
obvious for purposes of the summary judgment motion,
this burden is met by [plaintiff’s] allegation, forming the
sole basis for the complaint, that the [asserted prior
art/accused product] infringes.”). It is undisputed that
AstraZeneca conceived and reduced its drug to practice
before Teva’s first conception of the claimed subject mat-
ter. It is also undisputed that AstraZeneca did not under-
stand that crospovidone acted as a stabilizer in its drug
prior to Teva’s conception, if at all. Therefore, this appeal
does not involve a dispute of fact. Thus, this court need
only determine, as a matter of law, whether AstraZeneca
had to understand that crospovidone stabilized its drug in
order to win a priority dispute under § 102(g)(2). For the
reasons discussed below, it did not.
35 U.S.C. § 102(g)(2) provides:
A person shall be entitled to a patent unless . . .
before such person’s invention thereof, the inven-
tion was made in this country by another inventor
who had not abandoned, suppressed, or concealed
it. In determining priority of invention under this
subsection, there shall be considered not only the
respective dates of conception and reduction to
practice of the invention, but also the reasonable
diligence of one who was first to conceive and last
8 TEVA PHARMA v. ASTRAZENECA PHARMA
to reduce to practice, from a time prior to concep-
tion by the other.
AstraZeneca could establish prior invention by show-
ing that “(1) it reduced its invention to practice first . . . or
(2) it was the first party to conceive of the invention and
then exercised reasonable diligence in reducing that
invention to practice.” Mycogen Plant Sci. v. Monsanto
Co., 243 F.3d 1316, 1332 (Fed. Cir. 2001). Conception
occurs “when the inventor has a specific, settled idea, a
particular solution to the problem at hand . . . .” Creative
Compounds, LLC v. Starmark Labs., No. 2010-1445, Slip
Op. 13 (Fed. Cir. Jun. 24, 2011) quoting Burroughs Well-
come Co. v. Barr Labs., Inc., 40 F.3d 1223, 1228 (Fed. Cir.
1994). But “[a]n inventor need not understand precisely
why his invention works in order to achieve an actual
reduction to practice.” Parker v. Frilette, 462 F.2d 544,
547 (CCPA 1972). In order to establish reduction to
practice, the prior inventor must have (1) constructed an
embodiment or performed a process that met all the claim
limitations and (2) determined that the invention would
work for its intended purpose. Mycogen Plant Sci., 243
F.3d at 1332.
In Dow Chemical Co. v. Astro-Valcour, Inc., 267 F.3d
1334 (Fed. Cir. 2001), a case involving the use of isobu-
tane as a blowing agent to manufacture polyethylene
foam, the district court found that the alleged prior artist
had “made a product, meeting the limitations of the . . .
patents” before the priority dates of the patents and that
this earlier “production of foam . . . would invalidate the
relevant claims . . . if the other requirements of § 102(g)
were met.” Id. at 1339-40. In Dow, there was “undis-
puted, clear and convincing evidence in the record that
[the alleged prior inventor’s] employees immediately
appreciated what they had made, and indeed its signifi-
cance, when they made isobutane-blown foam . . . . [and]
TEVA PHARMA v. ASTRAZENECA PHARMA 9
were ‘surprised’ and ‘elated’ at the ease of making the
‘beautiful,’ ‘good’ foam that they made.” Id. at 1341.
In deciding that a prior inventor need not be “the first
to appreciate the patentability of the invention,” this
court explained that “the date of conception of a prior
inventor’s invention is the date the inventor first appreci-
ated the fact of what he made.” Id. In Dow, this court
reaffirmed its predecessor court’s holding that “a party
who first reduced to practice, but who ‘fail[ed] to recognize
that he had produced a new form [of matter] . . . is indica-
tive that he never conceived the invention.’” Id. (quoting
Heard v. Burton, 333 F.2d 239, 243 (CCPA 1964)). The
court likewise reaffirmed that § 102(g) “does not require
that [a prior inventor] establish that he recognized the
invention in the same terms as those recited in the count
[because t]he invention is not the language of the count
but the subject matter thereby defined.” Id. (quoting
Silvestri v. Grant, 496 F.2d 593, 597, 599 (CCPA 1974)).
As Silvestri had explained, “the language of the count is
but one way to define the new form and certainly not a
unique definition [. . . and a]ny claim they might have
written, based on this or other information specific to [the
new form] would still define the same subject matter as
the count even though in different terms.” 496 F.2d at
601. See also In re Kao, 639 F.3d 1057, 1066 (Fed. Cir.
2011) (“The claimed subject matter is not presumed to
change as a function of how one elects to measure it.”);
William Shakespeare, Romeo and Juliette act 2, sc. 2
(“[T]hat which we call a rose [b]y any other name would
smell as sweet.”).
Likewise, in Mycogen Plant Sciences, Monsanto ar-
gued that it was the first to reduce to practice inventions
relating to a synthetic gene with improved expression of a
pesticidal protein. 243 F.3d at 1331-32. Mycogen argued
that the Monsanto inventors failed to appreciate the
invention because they had focused on improving expres-
10 TEVA PHARMA v. ASTRAZENECA PHARMA
sion by modifying the frequency of certain nucleotides
rather than of certain codons. Id. at 1336. This court
rejected that argument, explaining that:
Monsanto is not required to have framed its prior
documentation about its reduction to practice in
the exact language given in the claims . . . . The
reduction to practice test does not require in haec
verba appreciation of each of the limitations of the
count. The fact that Monsanto may have de-
scribed parts of its process in terms of “nucleo-
tides” instead of “codons” is immaterial . . . . A
process describing the modification of certain
codons may also be described in terms of nucleo-
tides.
Id.
More recently, in Invitrogen Corp. v. Clontech Labs.,
Inc., 429 F.3d 1052 (Fed. Cir. 2005), this court again
explained that:
Conception . . . requires both (1) the idea of the
invention’s structure and (2) possession of an op-
erative method of making it. Thus, with regard to
a claimed chemical compound, conception requires
that the inventor be able to define the compound
so as to distinguish it from other materials, and to
describe how to obtain it . . . . [This] require[s]
more than unrecognized accidental creation. . . .
In other words, conception requires that the in-
ventor appreciate that which he has invented.
Id. at 1063 (quotations and citations omitted). In that
case, Invitrogen had invented a mutant reverse transcrip-
tase enzyme with DNA polymerase but no RNase H
activity (“RNase H minus reverse transcriptase”). Id. at
1058. Clontech established that scientists using a tech-
TEVA PHARMA v. ASTRAZENECA PHARMA 11
nique called “random mutagenesis” had previously pre-
pared a panel of some 100 mutant genes for reverse
transcriptase without knowing at the time where each of
the mutant genes had been altered. Id. Later, two of
these roughly 100 mutant genes turned out to code for an
RNase H minus reverse transcriptase enzyme. Id. As the
court explained, “[w]ith unrecognized accidental duplica-
tion, the invention exists but remains unrecognized. . . .
In the appreciation analysis, the relevant uncertainty
relates to the emerging recognition of something new.”
Id. at 1064. In vacating the district court’s § 102(g)
determination, the court explained that the record did not
support the view that the supposed prior inventors actu-
ally knew what they had made at the relevant time and
that the case therefore fit “squarely within the unrecog-
nized, accidental duplication cases.” Id. at 1066.
Dow, Mycogen Plant Sciences, and Invitrogen are con-
sistent applications of the same rule. To establish prior
invention, the party asserting it must prove that it appre-
ciated what it had made. The prior inventor does not
need to know everything about how or why its invention
worked. Nor must it conceive of its invention using the
same words as the patentee would later use to claim it.
In this light, it is apparent that the district court correctly
entered summary judgment.
Teva’s entire argument turns on the the phrase “sta-
bilizing effective amount.” As stated in Invitrogen, this
court must resolve questions of priority “using a properly
defined invention.” 429 F.3d at 1062. There is no ques-
tion that AstraZeneca appreciated that AstraZeneca’s
drug contained an “amount” of crospovidone. And because
of AstraZeneca’s limited concession of infringement, there
is no question that the amount of crospovidone Astra-
Zeneca’s drug contained falls within the scope of the
asserted claims as defined by the limitation “stabilizing
effective amount.”
12 TEVA PHARMA v. ASTRAZENECA PHARMA
AstraZeneca had to appreciate that the compound it
asserted as its invention was stable and what the compo-
nents of this formulation were. There is no question that
AstraZeneca had this appreciation. However, Astra-
Zeneca did not need to appreciate which component was
responsible for the stabilization. Teva effectively asks
this court to fault AstraZeneca for not first conceiving of
its drug in the same words in which Teva later chose to
claim it. This case therefore falls squarely within the
holdings of Dow and Silvestri. Because “[t]he invention is
not the language of the [claim] but the subject matter
thereby defined,” Teva’s argument must fail. Dow, 267
F.3d at 1341 (quoting Silvestri, 496 F.2d at 599).
While Teva relies substantially on Invitrogen for its
argument that AstraZeneca could not satisfy § 102(g)(2)
without appreciating that crospovidone stabilized its
drug, its reliance is misplaced. As explained above, the
alleged prior inventors in Invitrogen were unaware, until
too late, that they had accidentally created two genes
encoding RNase H minus reverse transcriptase. Here, by
contrast, when AstraZeneca made the claimed invention
first, it did so not by accident and it knew what it had
made.
Teva argues that by characterizing the claimed sub-
ject matter as a stabilized statin formulation without
emphasizing the requirement that the formulation be
stabilized only by an AGCP compound, the district court
implicitly adopted a broadening claim construction.
According to Teva, the district court thus relieved Astra-
Zeneca from its burden of proving that it appreciated the
stablizing function of the AGCP compound. But as dis-
cussed above, the district court’s decision did not resolve
any dispute about the scope of the asserted claims. Teva’s
allegations and AstraZeneca’s limited concession of in-
fringement did that. Thus, while Teva appears to make a
“claim construction” argument, it is actually asking this
TEVA PHARMA v. ASTRAZENECA PHARMA 13
court to hold that AstraZeneca needed to understand its
invention in the same terms used in the asserted claims.
As explained above, such a holding would directly conflict
with the holdings of Dow and Silvestri. Teva’s “claim
construction” argument is therefore without merit.
Teva also argues that this case requires us to resolve
exactly how, if at all, the doctrine of inherency applies to
priority under § 102(g). But this case does not involve a
factual dispute about whether or not the prior art in-
cludes a certain claim limitation (expressly or inherently).
Again, Teva’s allegations and AstraZeneca’s limited
concession of infringement took any such dispute off the
table. Accordingly, there is no role for this court’s inher-
ency doctrine to play. Teva’s argument is thus unavail-
ing.
Finally, Teva argues that if AstraZeneca did conceive
and reduce to practice the claimed subject matter, then it
suppressed or concealed the invention. According to Teva,
if AstraZeneca indeed conceived and reduced the inven-
tion to practice, AstraZeneca must have understood that
the crospovidone was a stabilizer in the AstraZeneca drug
formulation. Teva argues that if AstraZeneca understood
this and did not disclose it, then it necessarily suppressed
or concealed its understanding. But Teva’s argument
depends on the same premise already rejected above—
that AstraZeneca needed to appreciate the stabilizing
effect of crospovidone. This argument is therefore without
merit for the same reasons.
Teva’s remaining arguments have been considered
and do not have merit.
III. CONCLUSION
For the foregoing reasons, the district court’s entry of
summary judgment of invalidity is affirmed.
14 TEVA PHARMA v. ASTRAZENECA PHARMA
AFFIRMED