About Those PTAB Oral Arguments...
So what should we think about the 75 pages of oral argument transcript in front of the PTAB?
TL;DR: The case is probably going to come down to whether NR is an active ingredient in buttermilk, and ChromaDex made strong arguments that it might not be, which would mean that Elysium failed to carry its burden of demonstrating that buttermilk anticipated Niagen.
I think that ChromaDex's counsel did a better job than Elysium's counsel answering the questions asked. I think that the Judges did a good job probing around what they think will be the decisive arguments.
The Judges seemed inclined to accept ChromaDex's interpretation that the patent requires NR as an "active ingredient" of a pharmaceutical.
But the Judges also looked very hard at whether there was a way that they could nonetheless find that the prior art of buttermilk and skim milk used to treat dogs might ALSO have relied upon NR as an active ingredient.
So the result is likely to turn on the requirements of the doctrine of inherency and the burdens of proof.
But my sense was that ChromaDex's counsel gave strong, clear answers to every objection raised by the Judges.
As a result, I would think that Steptoe should think they had a good day, ChromaDex should be happy with their counsel's performance, and the Judges, even if they were originally inclined to invalidate some of the claims, may not see a clear way to do that now.
At the very least, if this comes out the wrong way for ChromaDex, the record will provide strong arguments on appeal.
I am hesitant to wade too far into a realm better fit for patent law specialists and biochemistry PhDs. But I will aspire to make at least a little progress in identifying and understanding the key arguments that will likely prove decisive, and how they fared in the hearing.
First, the entire situation is somewhat reminiscent of one of those brain teaser challenges where you know something is wrong, but the challenge is to figure out what.
In this case, it is entirely counterintuitive that buttermilk fed to dogs in hopes that it would cure black-tongue could somehow be prior art that would prevent someone almost a hundred years later from patenting (in the 8,383,086 patent) a pharmaceutical composition comprising nicotinamide riboside in admixture with a carrier formulated for oral administration that increases NAD.
The plain meaning of pharmaceutical composition would seem to exclude buttermilk.
And besides, how could buttermilk have taught us in 1927 how to use nicotinamide riboside when at the time of the experiments in question nicotinamide riboside hadn't even been discovered, and the dog study's proponents had no idea what caused the observed effect?
Indeed, since buttermilk also contains other NAD precursors -- tryptophan and nicotinamide -- how could the experiment tell us anything certain about nicotinamide riboside in particular?
But the Patent Trial and Appeal Board (PTAB) does not have the luxury of just saying, "That's ridiculous -- why are you wasting our time?" Instead, they have to articulate why buttermilk is or isn't a pharmaceutical composition, and whether the unknown and coincidental and maybe even irrelevant presence of NR in buttermilk could prevent a future inventor from patenting anything therapeutic if buttermilk somehow cured a disease in dogs?
That's why the Judges in the hearing asked questions like,
"What about oranges which contain vitamin C...?" (transcript page 48) Is an orange a pharmaceutical composition that is used to treat scurvy?
What if the NR in buttermilk "was present at 25 percent, would that still beat your isolating claim?" (transcript page 53)
To me, those question sound the same as, "What if Niagen pills grew on trees, then would Niagen be patentable?"
I guess not, but to me that only highlights the difference between buttermilk and Niagen -- or for that matter, the difference between oranges and Vitamin C pills. I cannot wrap my brain around the idea that Vitamin C pills aren't a novel, useful, non-obvious, patentable invention, in a world where the only other way to cure scurvy was by eating citrus fruit.
With that disclaimer, I'll try to highlight the competing positions.
The Key Issues
The primary issues that were discussed in the oral hearing are:
1. Does the modifier "pharmaceutical" before "composition" indicate that there needs to be an "active agent," and that nicotinamide riboside is the active agent?
2. Does a "pharmaceutical" need to be produced, as opposed to something that's just naturally occurring, like milk?
3. What does the term "isolated" mean in Claim 2?
4. Even if the patent covers NR as an active agent, isn't the NR in buttermilk an active agent for treating pellagra and black-tongue, and therefore prior art?
5. Does Elysium have the burden of proving that the NR in buttermilk MUST have been an active agent that cured or helped cure the dogs?
The last two arguments, I think, will prove decisive -- whichever way the panel resolves it -- but we'll take them one at a time.
1. Active Agent
This is a critical point for ChromaDex, and ChromaDex really needs the answer to be "Yes," because that distinguishes Niagen from all the other substances that might incidentally contain nicotinamide riboside, like buttermilk.
Elysium raises several arguments against the active agent interpretation, including the fact that the patent does not say that NR treats any particular condition, so there is no telling whether the NR is an active agent or not, and since we don't know what amount of NR would be effective against the unnamed conditions, the patent is indefinite.
This is another example of where the arguments, to me, seem to defy common sense. There is nothing in the Patent Act that says a pharmaceutical can only be patented for a single, specific condition. And even if there were, then the condition for the '086 patent would be an NAD deficiency, and the effective amount would correspond to the amount of the deficiency. So this line of reasoning just doesn't seem, to me, to go anywhere.
Judge Paulraj challenged the idea that the patent doesn't treat a disease, since the patent's preamble specifically mentions Pellagra.
This exchange between the panel judges and Elysium's lead attorney, Brendan Jones, captures the panel's reluctance to accept Elysium's theory that the word "pharmaceutical" does not necessarily imply an active agent:
JUDGE PAULRAJ: I understand your position that at least the claims don't recite the term "active agent." We are trying to figure out whether pharmaceutical composition would be understood to require the nicotinamide riboside as an active agent. So let me flat out ask you, what is your understanding of active agent? If I were to ask you how do you define active agent, what is your answer?
MR. JONES: So in the context of a specific treatment, I think an active agent is the combination -- is either the individual or combination of compounds that mediate the effect. However, I don't think active agent is applicable to just a pharmaceutical composition devoid of actually being used for something because I don't think -- there's no activity there. It's just sitting there. I don't think there is an active agent in a pill as it sits there on a desk...
JUDGE SCHNEIDER: Counsel, what about...where it says that the method involves administering to a patient having a disease or condition associated with the nicotinamide riboside kinase pathway and NAD+ biosynthesis, an effective amount of nicotinamide riboside composition so that the signs or symptoms of the disease or condition are prevented or reduced, doesn't that directly tie the nicotinamide riboside to treating a specific disease and showing that the NR is the active agent?
MR. JONES: Your Honor, in this case it's exactly what I was talking about where they are actually talking about actual therapeutic use of a particular disease where there's an active agent that's in the composition because it's being used for a specific purpose. The nicotinamide riboside, absent anything else, doesn't have an active agent because it's not doing anything active...
I got the distinct impression throughout that the Judges were inclined to give meaning to the term "pharmaceutical," perhaps by requiring an active agent and/or some kind of production process to distinguish naturally occurring substances with therapeutic potential.
Even when they asked hard questions of ChromaDex as to whether the word "pharmaceutical" necessarily implied an active agent, ChromaDex's lead counsel, John Abramic, had clear answers:
JUDGE SCHNEIDER: Where is that definition...that pharmaceutical composition has to have "an active."
MR. ABRAMIC: On page 6 or slide 6, there's a citation to expert
testimony and also to several references that talk about the fundamental concept that a pharmaceutical has an active ingredient. Because as we've talked about here, a pharmaceutical is something that treats a condition, you need an active in order to treat a condition. And this is not a point that's in dispute in this record.
JUDGE SCHNEIDER: And how do we tie that to saying that NR has to be the active ingredient?
MR. ABRAMIC: So first what we'll do is we'll look at the specification. And we know we have to look at the specification, and the substance that's identified in the claim after the phrase "pharmaceutical composition" is nicotinamide riboside. And so we need to go to specification to see what the spec says about nicotinamide riboside. And in every instance when you look at the specification, what we learn about looking at the specification is that this is an invention about treating disease with an increase in NAD+. So NAD+ is what's treating the disease. And nicotinamide riboside leads to the increase in NAD+. So nicotinamide riboside is one of the actives identified in the specification that leads to this increase in NAD+...
JUDGE SCHNEIDER: Milk contains nicotinamide riboside, does
MR. ABRAMIC: ...We can't say with absolute certainty that there was NR in the milk in Goldberger and Goldberger and Tanner. But the one thing we also can say is there's certainly no evidence that to the extent there was any NR in the milk of the prior art that it was active. And this gets back to this notion that nicotinamide riboside, every time in the specification that nicotinamide riboside is discussed, it's talked about in the context of administering NR to treat something...
JUDGE SCHNEIDER: Counsel, is the phrase "active agent" itself ever used in the specification?...Can you point it to me, please?
MR. ABRAMIC: Yes...And so you'll see that at...the top of that section of the specification, there's a listing of what the patent describes as the compounds of the invention, the compounds that are involved in this NAD+ synthesis, and one of them is nicotinamide riboside. And it says that the method of the invention can be conveniently used or administered in a composition containing the active agent in combination with a pharmaceutically acceptable carrier....And the carrier is paired with the active agent in the specification. Why? Because that's what a carrier does....There's nothing in the specification that says you use a carrier with some inactive excipient. That doesn't make sense. And there's nothing in the specification that says that nicotinamide riboside can be an inactive excipient.
2. Naturally Occurring
It was Judge Schneider who commented that pharmaceuticals don't just grow on trees, they are chemicals produced industrially for a medicinal purpose, which "would sort of imply that you have got to actually make something up rather than milk which just occurs naturally." (Transcript p. 11)
Elysium seems to have a few responses to this, but I think finally lands on the idea that skim milk and buttermilk don't come out of cows as skim milk and buttermilk, but instead must have the cream or the butter removed, and so the substances used in the experiments were not natural, but were man-made.
This doesn't make much sense to me, because the removal of the cream or the butter was completely unrelated to the therapeutic effect, which presumably would have been the same with whole milk. So the processing that Elysium refers to is incidental and irrelevant -- not different from the processing that occurs when the milk is removed from the cow or placed in a cup, or divided into 8-ounce portions -- this kind of processing isn't what creates a pharmaceutical.
The panel already construed this term in its original decision not to institute proceedings in the '807 patent or with respect to Claim 2 in the '086 patent. The peculiar timing of the SCOTUS decision in SAS gave Elysium a chance to convince the panel to re-consider that interpretation. So both sides spoke about it considerably, but I did not get the sense from any of the judges' comments that they were inclined to revisit the issue.
4. Is NR the Active Agent in Buttermilk?
JUDGE SCHNEIDER: Counsel, if we accept your definition or your proposed construction that the word "active agent" should be construed in the claim, doesn't the milk in Goldberger still meet that limitation?...Goldberger does show that it treated an NR-related disorder in an effective amount, so it met that limitation. So why is Goldberger not anticipatory? (Transcript pp. 37-38)
ChromaDex's answers to this are:
(1) We don't know what caused the effect 100 years ago
(2) Tryptophan and Nicotinamide are both present in milk and might have caused the observed effect
(3) The NR in the milk might have been degraded -- we don't know that an effective amount, or any amount, was present
(4) The NR might have been inactive because it was bound to another molecule, according to Elysium's prior art (Trammell)
(5) It is Elysium's burden to show that the NR was necessarily an active agent, and there is no way that they can do that.
All of these points seem to me correct, and it is one of the risks that Elysium incurred when they chose as their prior art a 90+ year old experiment from a time that predates the discovery of the molecule in question.
The Judges seemed uncomfortable accepting ChromaDex's proposal that the NR in the milk in the 1920's experiment was degraded, since it probably wasn't, and there was no particular reason to suspect degradation.
But they were looking hard for evidence that the NR was the active ingredient in the milk, which would support Elysium's prior art contention:
JUDGE SCHNEIDER: ...Assuming we find that the NR -- we incorporate your word "active agent" into claim 1 and we find that there is evidence that NR is active in milk, wouldn't that meet the requirements of the claim?
MR. ABRAMIC: If you found that there was evidence that the NR, that NR was active in milk, natural milk, not NR added to milk, but then you would still have to say that somehow that evidence that you are talking about, Your Honor, which isn't in this record, but you'd still have to find some way to say that that evidence then proves that the milk that was consumed in the 1920s for those prior art was also active. And those are two gigantic leaps that I don't think you can make based on the law of inherency.
JUDGE SCHNEIDER: How do you reconcile the statement that in one embodiment the natural source is cow's milk with your argument your co-counsel made is that the milk at least in Trammell was bound and wasn't active? Here you are saying I can get what I need by going to cow's milk, but there's no discussion here that says you have to then unbind it to make it active. You are just saying I can get what I need, the nicotinamide riboside, from milk.
MS. LUCIA: The specification has a lot to say about how hard it is to do that. So if we go to slide 39, this portion of the specification is talking about it identifies the types of synthetic sources of nicotinamide riboside where it can get that from various chemical companies. It goes on to say that then you can test natural sources for the presence of nicotinamide riboside, and I think that's precisely what Trammell 1 was doing. They were trying to see, let's take a look at some milk and see which NAD+ precursors are present in that reference, and then they reported that results. Now, if you wanted to do some additional work, you are going to have to extract those precursors from the milk. So that's what this next highlighted portion is about. It says isolated extracts of the natural sources can be prepared using standard methods.
JUDGE SCHNEIDER: Where does it suggest that you have to remove a bound element to the nicotinamide riboside? I don't see that, and saying what we are talking about separating out the NR, but nothing is talking about having to remove the bound compound that your counsel talked about which render the NR inactive.
MS. LUCIA: I think, Your Honor, this is consistent with that. And certainly it's not using those exact words that you are using, but if you are going to take an extract out of the milk, and if what you are trying to get is the specific nicotinamide riboside molecule, and quite frankly, it would probably be more pure than 25 percent if you are going to put it in a pharmaceutical composition, in order to get that molecule out of an extract of cow's milk, you are going to have to do the things that the specification mentions in column 26, line 64 through 27:12, which is, like I said, you are going to have to grind it down and you are going to have to centrifuge it to remove the cellular debris. And so those types of things will -- to the extent your NR is bound to other molecules within the milk, those are the processes to the extent you need to unbind that NR to get just the NR molecule itself.
Burden of Proof
Elysium tried to suggest that whether the NR in milk was an active agent "doesn't really mean anything" (transcript p. 61) or was a "red herring" or "manufactured argument" (transcript p. 65) because nobody has ever suggested that NR was inactive. Why would NR be present in mammals' milk if it didn't do anything?
But the Court did not accept that formulation:
JUDGE MITCHELL [TO MR. JONES]: I do have a quick question. So if we say that the NR has to be active, we adopt what patent owner is saying, aren't you sort of turning an inherency argument on its head? You are saying, well, there's nothing that says that this is not active in milk. But isn't it really your burden to show with inherency that, yes, it necessarily has to be an active agent in milk?
Elysium gets stuck on this, because although the odds might be good that the NR in milk was IN FACT active, their burden is to show that it necessarily was active. So Elysium's counsel modulates his language in his response -- which may well turn out to be the decisive moment in the case -- attempting to cross the bridge from actual evidence that NR is active to an unsupported conclusion that the NR was necessarily active:
MR. JONES: Your Honor, I believe that our burden is by the preponderance of the evidence we need to show that the -- okay, assuming that you require the activity in milk, by the preponderance of the evidence we need to show that the nicotinamide riboside is necessarily active in milk. I think if you look at all the evidence as a whole, everything would lead one to believe that the nicotinamide riboside is active in milk. When you look at how the inventor himself is treating milk, how the parties-in-interest are classifying milk, how it's being classified in the art, and if you look at just the whole purpose of milk, I think if you take all that together, more likely than not by the preponderance of the evidence, nicotinamide riboside is necessarily active in milk. (emphases added)
That leap from "probably active" to "necessarily active" is not logically permissible, and ChromaDex's counsel jumped on it:
MR. ABRAMIC: Your Honors, I would like to start with that last point that counsel just made, and that is the burden of proof and inherency. And I think the statement that he made was when you look at all of the evidence, that you would believe that the NR that may have been present in Goldberger was active...There is no proof that the NR in Goldberger was active and was increasing NAD+ biosynthesis.
JUDGE PAULRAJ: Counsel, under what circumstances would you have NR in milk not being active? Could you kind of describe how frequent or how unusual that would be?
MR. ABRAMIC: I don't have numbers for you, Your Honor, but what we do is we have the testimony from their expert that we showed previously where his response to the question -- and we know that NR is bound in milk. We know that from Trammell. And what Dr. Baur told us, and I'm on slide 22, is that there are molecules that exist that can inactivate compounds. And the answer was, I don't know whether or not the molecules that are in milk are inactivating NR...all we need is a possibility to defeat inherency. All we need is a possibility that that NR might not have been active.
What we have is petitioner bringing us references from the 1920s and they are making a leap that there was NR in milk from the 1920s based off of references that are contemporary.
JUDGE PAULRAJ: Has milk changed since the 1920s?
MR. ABRAMIC: We don't have evidence in the record. It's not our burden to establish what was in milk in the 1920s...Trammell...said that NR was bound to other compounds. And they have an expert who clearly admits that that can render NR inactive.
JUDGE PAULRAJ: Is bound NR something that might be available even if it's bound to increase NAD biosynthesis?
MR. ABRAMIC: I think the testimony is that bound NR could increase NAD+ biosynthesis, but we don't know whether or not it could....We just don't know.
JUDGE SCHNEIDER: How do you reconcile that with Exhibit 1008, petitioner's slide 34 and slide 35, which is Exhibit 1023 that talk about milk being a source of NR, that NR is a precursor for NAD+? So if it's a source and it's bound and it's inactive, why would it be a source of that?
MR. ABRAMIC: Because it's a source from which you can extract isolated NR and obtain NR that is then active.
One Last Observation -- Counsel for the Parties
I was going to say that I thought from the bare transcript -- I'd have a stronger opinion if I had been in the room and if I could see the slides -- it sounded like Steptoe did a better job than Foley Hoag did at just being calm, cool, and collected in the merciless pressure-cooker that is a one-hour oral argument in what might be perceived as a bet-the-company kind of case.
I have only sympathy and admiration for the attorneys on both sides who had to do this.
But then I noticed something unusual. On Page 3 of the transcript Elysium's attorney says, "I'm Brendan Jones. I'm the lead counsel for petitioners, Elysium Health, and with me today is my backup counsel, Don Ware."
There's nothing unusual about having a lead counsel and a backup counsel, but according to Foley Hoag's website Brendan Jones is a 5th year associate, and Don Ware is the partner who heads Foley Hoag's patent litigation group. Mr. Ware does not appear to speak during the hearing -- at least nothing that made it into the transcript.
I'm not saying that Brendan Jones isn't smart -- he has a PhD from MIT, for goodness sake! -- and I'm not even saying he didn't do a great job.
But my sense that Mr. Jones' words were sometimes coming awfully fast is bolstered by his own comment on transcript page 60, "I apologize for the confusion. Being up here on the spot, you jumble your words."
I can't guess whether this was a gutsy move by Elysium, or whether Mr. Jones is one day going to be recognized as the greatest patent litigator of all time, and you gotta start somewhere, or whether Elysium is paying to train Foley Hoag's junior staff (something clients absolutely hate).
But by contrast, the lead attorney for Steptoe, John Abramic, seems to have about twelve more years practice experience than Mr. Jones, and I think that showed. Steptoe's associate, Jamie Lucia, even though she has more than ten years of practice experience, handled the much smaller issue of whether the term "isolated" was properly construed. That is a more typical delegation of duties.