PDL Biopharma Inc v. Merck Sharp & Dohme Corp

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: PDL BioPharma, Inc. (Delaware)
  • Defendant: Merck Sharp & Dohme Corp. (New Jersey)
  • Plaintiff’s Counsel: Parsons Behle & Latimer; Irell & Manella LLP
• Case Identification: 3:15-cv-00536, D. Nev., 10/28/2015
• Venue Allegations: Plaintiff alleges venue is proper in the District of Nevada because a substantial part of the events giving rise to the claim, including sales and offers for sale of the accused product and recruitment for clinical trials, occurred in the district.
• Core Dispute: Plaintiff alleges that Defendant’s cancer therapy drug, Keytruda®, infringes a patent related to the creation of "humanized" therapeutic antibodies that retain high efficacy while reducing immunogenicity in patients.
• Technical Context: The case concerns monoclonal antibody therapeutics, a foundational technology in modern biotechnology for treating cancer and immunological diseases by using engineered proteins to target specific cells or receptors.
• Key Procedural History: The complaint alleges that Defendant previously entered into a license agreement with Plaintiff in 2005 for rights to the asserted patent family (the "Queen Patents") for certain products, but that this license did not cover the accused product, Keytruda®. The asserted patent expired on December 2, 2014, limiting the action to a claim for past damages.

Case Timeline

Date	Event
1990-12-19	’761 Patent Priority Date
1997-12-02	’761 Patent Issue Date
2014-09-04	Keytruda® first FDA approval (for melanoma)
2014-12-02	’761 Patent Expiration Date
2015-10-02	Keytruda® second FDA approval (for NSCLC)
2015-10-28	Complaint Filing Date

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 5,693,761 - "Polynucleotides Encoding Improved Humanized Immunoglobulins," issued December 2, 1997

The Invention Explained

• Problem Addressed: The patent addresses the challenge of using nonhuman (typically murine, or mouse) monoclonal antibodies as therapeutics in humans. Such antibodies are often rejected by the human immune system, a problem known as immunogenicity (Compl. ¶12). Early attempts to solve this, such as creating "chimeric" antibodies or using "CDR-grafting," often resulted in molecules that were still immunogenic or had lost their ability to effectively bind to their target antigen (a "loss of affinity") (Compl. ¶¶13, 15).
• The Patented Solution: The invention provides novel methods for producing "humanized" immunoglobulins that are substantially non-immunogenic in humans but retain the high binding affinity of the original donor antibody (’761 Patent, col. 2:37-43). The method involves transplanting the key antigen-binding regions (Complementarity Determining Regions, or CDRs) from a donor (e.g., mouse) antibody into a human antibody "framework." The key inventive step involves selecting human frameworks and making specific amino acid substitutions based on sequence identity to preserve the three-dimensional structure required for high-affinity binding (’761 Patent, col. 2:43-52).
• Technical Importance: This technology was designed to enable the development of a new generation of effective and safe antibody-based drugs for cancer and other diseases by minimizing adverse immune reactions in patients (Compl. ¶¶2, 16).

Key Claims at a Glance

• The complaint asserts infringement of at least Claim 1 (Compl. ¶31).
• Independent Claim 1 requires:
  • First and second polynucleotides that encode the heavy and light chain variable regions of a humanized immunoglobulin.
  • The humanized immunoglobulin has CDRs from a donor immunoglobulin and frameworks from a human acceptor immunoglobulin.
  • The humanized immunoglobulin binds to an antigen with an affinity constant of at least about 10⁸ M⁻¹ and no greater than about four-fold that of the donor immunoglobulin.
  • The humanized heavy chain framework sequence is at least 65% identical to the donor heavy chain framework sequence.
  • The humanized heavy chain framework comprises at least 70 amino acid residues identical to the acceptor human heavy chain framework.
• The complaint does not explicitly reserve the right to assert dependent claims.

III. The Accused Instrumentality

Product Identification

• The accused product is Merck’s drug Keytruda® (pembrolizumab) (Compl. ¶21).

Functionality and Market Context

• Keytruda® is a humanized monoclonal IgG4 antibody used as a cancer immunotherapy (Compl. ¶21). It is designed to bind to the human PD-1 receptor on cells, and the complaint alleges it is specifically the humanized antibody designated H409A11 (Compl. ¶22). The complaint notes its FDA approval for treating advanced melanoma and metastatic non-small cell lung cancer, positioning it as a significant therapeutic product (Compl. ¶21). The complaint includes a diagram to illustrate the structural differences between mouse, chimeric, and the accused "humanized" antibody type (Compl., p. 6, Figure 3). This figure depicts how "humanized" antibodies primarily consist of human elements (green) with only small, targeted mouse elements (red), distinguishing them from earlier chimeric forms.

IV. Analysis of Infringement Allegations

’761 Patent Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
First and second polynucleotides respectively encoding heavy and light chain variable regions of a humanized immunoglobulin...	Keytruda® is allegedly manufactured using polynucleotides that encode the variable regions of the heavy and light chains of the specific humanized antibody H409A11.	¶23	col. 2:37-43
...having complementarity determining regions (CDRs) from a donor immunoglobulin and heavy and light chain variable region frameworks from human acceptor immunoglobulin...	The six CDRs from a murine donor antibody (hPD-1.09A) were allegedly combined with human acceptor immunoglobulin frameworks (identified by GenBank accession numbers) to create the humanized antibody H409A11.	¶¶25-27	col. 11:35-43
...which humanized immunoglobulin specifically binds to an antigen with an affinity constant of at least about 10⁸ M⁻¹ and no greater than about four-fold that of the donor immunoglobulin...	H409A11 allegedly binds to the PD-1 antigen with an affinity constant of 3.41 x 10¹⁰M⁻¹, which is asserted to be "no greater than about four-fold" of the donor antibody’s affinity of 4.55 x 10¹⁰M⁻¹.	¶28	col. 162:61-163:4
...wherein the sequence of the humanized immunoglobulin heavy chain variable region framework is at least 65% identical to the sequence of the donor immunoglobulin heavy chain variable region framework...	The complaint alleges that the heavy chain framework sequence of H409A11 is at least 65% identical to that of the donor antibody, hPD-1.09A.	¶29	col. 162:64-163:1
...and comprises at least 70 amino acid residues identical to those in the acceptor human immunoglobulin heavy chain variable region framework.	The complaint alleges that the heavy chain framework of H409A11 contains at least 70 amino acid residues identical to the human acceptor framework (identified by GenBank accession #AB063829).	¶30	col. 163:2-6

• Identified Points of Contention:
  • Evidentiary Questions: The complaint makes several specific, quantitative allegations regarding sequence identity percentages and binding affinities "on information and belief" (Compl. ¶¶28-30). A central issue will be whether Plaintiff can prove these factual allegations through discovery, as Defendant’s proprietary data on the precise structure and properties of Keytruda® will be required to verify them.
  • Scope Questions: The claim requires the affinity of the humanized antibody to be "no greater than about four-fold that of the donor." The complaint alleges the ratio is approximately 1.33-fold (4.55/3.41) (Compl. ¶28). The interpretation of the term "about" could become a focus of claim construction, defining the permissible range of affinity loss.

V. Key Claim Terms for Construction

• The Term: "about"

• Context and Importance: This term appears in two limitations in Claim 1: "at least about 10⁸ M⁻¹" and "no greater than about four-fold." Its construction is critical because the infringement analysis depends on whether the specific, measured binding affinities of Keytruda® and its donor antibody fall within the claimed numerical ranges. Practitioners may focus on this term because its scope will directly determine whether the allegedly infringing product, with its specific affinity values, meets the claim limitation.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The specification suggests some flexibility, stating that the affinity of the humanized antibody "will generally be within about 2 fold of, but may be up to about 10 fold less than, the original mouse antibody." (’761 Patent, col. 3:37-40). This language may be used to argue that "about" encompasses a significant range of values.
  • Evidence for a Narrower Interpretation: A party could argue that the "about four-fold" language in Claim 1 itself acts as a more specific definition than the general discussion in the specification, suggesting a narrower range than the "up to about 10 fold" possibility. The specific examples in the patent, which show affinity differences typically within a factor of two (e.g., ’761 Patent, Table 2, col. 45:39), could be used to argue for a tighter construction.

• The Term: "humanized immunoglobulin"

• Context and Importance: The entire patent is directed to a specific method of "humanizing" antibodies. The definition of this term is fundamental to distinguishing the claimed invention from prior art (e.g., "chimeric" antibodies) and other antibody engineering techniques. The dispute will center on whether Keytruda® is properly classified as a "humanized immunoglobulin" as defined by the patent.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The patent provides a general definition: "a humanized immunoglobulin is a non-human immunoglobulin, of which the complementarity determining regions (CDR's) have been substituted by the corresponding CDR's of a human immunoglobulin." (’761 Patent, col. 11:35-38, rephrased). This broad statement could support an argument that any antibody created by this general process is "humanized."
  • Evidence for a Narrower Interpretation: The patent summary and detailed description emphasize that the invention is for "improved" humanized antibodies that solve the affinity-loss problem of prior methods (’761 Patent, col. 2:37-43). A party may argue that to be a "humanized immunoglobulin" under the patent, the antibody must not only be made by CDR-grafting but must also incorporate the specific framework selection and amino acid substitution principles taught in the patent to maintain high affinity.

VI. Other Allegations

• Indirect Infringement: The complaint does not contain specific counts for indirect or contributory infringement. It alleges direct infringement by Merck for "making, using, offering for sale, selling, and/or importing Keytruda®" (Compl. ¶31).
• Willful Infringement: The complaint alleges that Merck’s infringement was willful, wanton, and deliberate (Compl. ¶¶33-34). The factual basis for this allegation is Merck's alleged pre-suit knowledge of the ’761 patent, stemming from a 2005 license agreement between Merck and PDL for other products under the same "Queen Patents" family, which purportedly did not cover Keytruda® (Compl. ¶33). This history is alleged to establish that Merck was aware of the patent and its scope long before the infringing activity began.

VII. Analyst’s Conclusion: Key Questions for the Case

1. An Evidentiary Question of Fact: Will discovery confirm the complaint's "information and belief" allegations? The case's viability rests on whether the actual amino acid sequence and binding affinity data for Keytruda® and its murine precursor meet the specific quantitative thresholds of Claim 1, including the ">65% identity," ">70 identical residues," and "about four-fold" affinity requirements.

2. A Question of Claim Scope: How will the court construe the term "about"? The outcome may depend on whether the court adopts a narrow interpretation based on the claim's specific "four-fold" language or a broader one informed by the specification's more general discussion of a "10-fold" possibility, potentially altering whether Keytruda's measured affinity infringes.

3. A Question of Willfulness and Intent: Given Merck’s alleged long-standing awareness of the patent through a prior licensing agreement, a key question will be whether its decision to commercialize Keytruda® without a license constituted objective recklessness. The analysis will likely focus on Merck’s state of mind and any non-infringement or invalidity positions it developed prior to litigation.