On Jan. 22, 2019, the U.S. Supreme Court unanimously affirmed Federal Circuit's decision regarding "on sale" bar under AIA's 35 USC 102(a)(1) by holding that the catchall phrase "otherwise available to the public" did not alter the meaning of "on sale." Helsinn Healthcare S.A. v. Teva Pharm. USA, Inc., 586 U.S. ___ (2019). Petitioner Helsinn, a Swiss pharma, acquired rights to palonosetron, the active ingredient in Aloxi. Helsinn submitted protocols for Phase III clinical trials for 0.25mg and 0.75mg dose of palonosetron. Helsinn and MGI Pharma entered into a license agreement, and a supply and purchase agreement. Both agreements included the dosage information and MGI disclosed these agreements in its SEC 8K filing after redacting the dosage information. Two years thereafter, Helsinn filed a provisional patent application covering the above dosages and the asserted patent issued from an application filed on May 2013 claiming priority to the provisional application. Teva filed an ANDA and asserted that the patent was invalid because the 0.25mg dose was "on sale" more than one year before Helsinn filed the provisional patent application.
The district court concluded that the "on sale" provision did not apply because the public disclosure of the agreements did not disclose the dosages and therefore the invention was not "on sale" before the critical date. The Federal Circuit reversed concluding that "if the existence of the sale is public, the details of the invention need not be publicly disclosed in the terms of sale" to fall within the AIA's on-sale bar. In affirming the Federal Circuit, the Supreme Court reasoned that the Court's precedence suggest that a sale or offer of sale need not make an invention available to the public and that "secret sales" can invalidate a patent. According to the Court, the phrase "on sale" had acquired a well-settled meaning when the AIA was enacted and that Congress did not intend to upset that precedent with the addition of a broad catchall phrase. The Court then held that Congress did not alter the meaning of "on sale" when it enacted the AIA and that an inventor's sale of an invention to a third party who is obligated to keep the invention confidential can qualify as a prior art under 35 USC 102(a).
The takeaway from the Supreme Court's decision is that secret sales can be prior art. Any patent application filing must consider the date of such sales for prior art purposes.
Full text of the opinion is available here.
The district court concluded that the "on sale" provision did not apply because the public disclosure of the agreements did not disclose the dosages and therefore the invention was not "on sale" before the critical date. The Federal Circuit reversed concluding that "if the existence of the sale is public, the details of the invention need not be publicly disclosed in the terms of sale" to fall within the AIA's on-sale bar. In affirming the Federal Circuit, the Supreme Court reasoned that the Court's precedence suggest that a sale or offer of sale need not make an invention available to the public and that "secret sales" can invalidate a patent. According to the Court, the phrase "on sale" had acquired a well-settled meaning when the AIA was enacted and that Congress did not intend to upset that precedent with the addition of a broad catchall phrase. The Court then held that Congress did not alter the meaning of "on sale" when it enacted the AIA and that an inventor's sale of an invention to a third party who is obligated to keep the invention confidential can qualify as a prior art under 35 USC 102(a).
The takeaway from the Supreme Court's decision is that secret sales can be prior art. Any patent application filing must consider the date of such sales for prior art purposes.
Full text of the opinion is available here.
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