DCT

2:18-cv-04195

Valeant Pharma North America LLC v. KVK Tech Inc

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:18-cv-04195, E.D. Pa., 09/27/2018
  • Venue Allegations: Venue is based on Defendant being a Pennsylvania corporation with its principal place of business within the district, where it allegedly develops, manufactures, and markets pharmaceutical products.
  • Core Dispute: Plaintiffs allege that Defendant’s filing of an Abbreviated New Drug Application (ANDA) to market a generic version of the topical antifungal solution Jublia® constitutes an act of infringement of eight U.S. patents.
  • Technical Context: The technology relates to pharmaceutical compositions and methods for the topical treatment of onychomycosis, a common fungal infection of the nail that is historically difficult to treat due to the nail plate's barrier properties.
  • Key Procedural History: This is a Hatch-Waxman action triggered by a notice letter from Defendant regarding its ANDA submission for a generic version of Plaintiffs' FDA-approved drug, Jublia®. The patents-in-suit are listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (the "Orange Book") as covering Jublia®.

Case Timeline

Date Event
1999-07-28 Earliest Priority Date for ’506 Patent
2007-01-26 Earliest Priority Date for ’494, ’978, ’009, ’272, ’394, ’698, and ’955 Patents
2007-05-08 ’506 Patent Issued
2011-10-18 ’494 Patent Issued
2013-07-16 ’978 Patent Issued
2014-06-06 FDA Approved New Drug Application for Jublia®
2016-04-05 ’009 Patent Issued
2017-02-14 ’272 Patent Issued
2017-05-30 ’394 Patent Issued
2018-01-09 ’698 Patent Issued
2018-01-30 ’955 Patent Issued
2018-08-09 KVK-Tech, Inc. Notice of Certification Letter Sent
2018-09-27 Complaint Filed

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

U.S. Patent No. 7,214,506 - Method for Treating Onychomycosis

The Invention Explained

  • Problem Addressed: The patent’s background section describes the significant challenge in evaluating the true effectiveness of topical antifungal agents for nail infections. It notes that residual drug remaining in an excised nail or skin sample can inhibit fungal growth when cultured in a lab, potentially leading to a false conclusion that the fungus has been eradicated when viable fungus remains (’506 Patent, col. 2:3-18).
  • The Patented Solution: The patent describes a new method for evaluating drug efficacy by first removing the residual antimicrobial agent from the biological sample (e.g., through dialysis) before attempting to culture any remaining fungus. This process is intended to provide a more accurate assessment of whether the drug has a true sterilizing effect (’506 Patent, col. 2:55-3:12). The claims of the patent, however, are directed to a method of treating onychomycosis by topically administering a specific triazole compound (efinaconazole) found to be effective using this evaluation methodology (’506 Patent, col. 17:31-38).
  • Technical Importance: The invention provides a method of treatment for onychomycosis, a condition for which topical therapies have historically shown low cure rates, offering an alternative to systemic oral medications that carry risks of side effects (’506 Patent, col. 2:26-39).

Key Claims at a Glance

  • The complaint asserts infringement of at least one claim, with Claim 1 being the first independent claim (Compl. ¶28).
  • The essential elements of Claim 1 are:
    • A method for treating a subject having onychomycosis
    • Wherein the method comprises topically administering to a nail of said subject
    • A therapeutically effective amount of a specific antifungal compound (efinaconazole).

U.S. Patent No. 8,039,494 - Compositions and Methods for Treating Diseases of the Nail

The Invention Explained

  • Problem Addressed: The patent identifies the nail plate as a "formidable barrier to drug penetration," which is why many topical treatments for onychomycosis, particularly nail lacquers that form a solid film, have low efficacy (’494 Patent, col. 1:35-2:12).
  • The Patented Solution: The invention is a pharmaceutical composition with a low surface tension (40 dynes/cm or less) that does not form a solid film upon application. The formulation is designed to deliver an active ingredient not only by penetrating the nail plate, but also by spreading into the nail folds and being wicked via capillary action into the gap between the nail and the nail bed, a space often created by the disease itself (’494 Patent, col. 4:40-5:4). The composition consists essentially of a volatile vehicle, a triazole antifungal, a wetting agent, and optionally a non-volatile solvent.
  • Technical Importance: This technology offers a novel delivery mechanism for topical antifungal drugs that bypasses some of the limitations of permeating the dense keratin of the nail plate, instead leveraging the physical characteristics of the diseased nail unit to deliver the drug to the site of infection (’494 Patent, col. 3:56-4:2).

Key Claims at a Glance

  • The complaint asserts infringement of at least one claim, with Claim 1 being the first independent claim (Compl. ¶39).
  • The essential elements of Claim 1 are:
    • A method for treating a nail disorder
    • Comprising topically applying a pharmaceutical composition consisting essentially of: a volatile and/or penetrating vehicle, a triazole antifungal active ingredient, and a wetting agent
    • Wherein the composition has a surface tension of 40 dynes/cm or less
    • And wherein the composition, when applied to the surface of a nail, does not form a solid film.

U.S. Patent No. 8,486,978 - Compositions and Methods for Treating Diseases of the Nail

  • Technology Synopsis: This patent is related to the ’494 Patent and describes the pharmaceutical composition itself rather than the method of its use. The claimed invention is a low surface tension, non-film-forming composition comprising a volatile vehicle, a wetting agent, and a triazole antifungal active pharmaceutical ingredient (efinaconazole), intended for treating nail disorders (Compl. ¶14).
  • Asserted Claims: At least one claim (Compl. ¶50).
  • Accused Features: KVK's generic efinaconazole topical solution is alleged to be a composition that meets the limitations of the asserted claims (Compl. ¶51).

U.S. Patent No. 9,302,009 - Compositions and Methods for Treating Diseases of the Nail

  • Technology Synopsis: This patent claims pharmaceutical compositions for treating nail disorders that specifically recite efinaconazole in combination with other excipients: ethanol, cyclomethicone, diisopropyl adipate, C12-15 alkyl lactate, and an antioxidant (Compl. ¶15).
  • Asserted Claims: At least one claim (Compl. ¶61).
  • Accused Features: KVK's generic product is alleged to be a pharmaceutical composition containing the claimed ingredients (Compl. ¶62).

U.S. Patent No. 9,566,272 - Compositions and Methods for Treating Diseases of the Nail

  • Technology Synopsis: This patent claims methods for treating onychomycosis by applying the specific formulations claimed in related patents like the ’009 Patent. The claimed method involves topically applying a composition including efinaconazole, ethanol, diisopropyl adipate, C12-15 alkyl lactate, and cyclomethicone (Compl. ¶16).
  • Asserted Claims: At least one claim (Compl. ¶72).
  • Accused Features: The use of KVK’s generic product as directed by its proposed labeling is alleged to infringe the claimed method (Compl. ¶¶73-74).

U.S. Patent No. 9,662,394 - Stabilized Efinaconazole Compositions

  • Technology Synopsis: This patent addresses the problem of discoloration and instability of efinaconazole formulations during storage. The invention claims compositions containing efinaconazole that are stabilized by the inclusion of specific agents, including water, BHT, a salt of EDTA, and citric acid, as well as methods of using these stable compositions (Compl. ¶17).
  • Asserted Claims: At least one claim (Compl. ¶83).
  • Accused Features: KVK's generic product is alleged to contain the claimed stabilizing agents and thus infringe the composition claims (Compl. ¶84).

U.S. Patent No. 9,861,698 - Compositions and Methods for Treating Diseases of the Nail

  • Technology Synopsis: This patent claims pharmaceutical formulations comprising specific excipients—ethanol, cyclomethicone, diisopropyl adipate, and mixed C12-15 alkyl lactates—and methods of using them for treating nail disorders (Compl. ¶18). This appears to be a further refinement of the formulation patents.
  • Asserted Claims: At least one claim (Compl. ¶94).
  • Accused Features: KVK's proposed generic product is alleged to be a formulation that meets the asserted claim limitations (Compl. ¶95).

U.S. Patent No. 9,877,955 - Compositions and Methods for Treating Diseases of the Nail

  • Technology Synopsis: This patent claims methods for treating onychomycosis by applying a pharmaceutical composition comprising efinaconazole along with ethanol, diisopropyl adipate, C12-15 alkyl lactate, and cyclomethicone (Compl. ¶19). It is another method patent related to the family of formulation patents.
  • Asserted Claims: At least one claim (Compl. ¶105).
  • Accused Features: The intended use of KVK’s generic product, as instructed by its labeling, is alleged to constitute infringement of the claimed method (Compl. ¶106).

III. The Accused Instrumentality

  • Product Identification: KVK-Tech, Inc.’s generic efinaconazole topical solution, 10% (Compl. ¶6).
  • Functionality and Market Context: The accused product is a topical pharmaceutical solution intended as a generic version of the branded drug Jublia®, which is used for the treatment of onychomycosis (Compl. ¶¶23, 25). The act of infringement alleged in the complaint is the filing of Abbreviated New Drug Application No. 212213 with the U.S. Food and Drug Administration, which seeks approval to market this generic drug in the United States before the expiration of the patents-in-suit (Compl. ¶¶22, 28). The complaint alleges that the proposed generic solution is "the same, or substantially the same, as Jublia®" (Compl. ¶26). No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint does not provide a detailed, element-by-element infringement analysis or a claim chart. The infringement theory is predicated on the nature of ANDA litigation, wherein the filing of an application for a generic drug that is bioequivalent to a branded product is an artificial act of infringement if the branded product is covered by valid patents.

  • '506 Patent Narrative Infringement Theory: The complaint alleges that KVK’s generic product contains efinaconazole and that its proposed product labeling will instruct medical professionals and patients to topically apply the solution to the nail to treat onychomycosis. This instructed use, if carried out after FDA approval, would directly infringe at least one claim of the ’506 Patent (Compl. ¶¶29-30).
  • '494 Patent Narrative Infringement Theory: The complaint alleges that KVK's generic solution is a composition having the features recited in the claims of the ’494 patent, including low surface tension and a non-film-forming character. It further alleges that KVK's proposed labeling will instruct users to apply this composition to the nail to treat a nail disorder, which would infringe the claimed method (Compl. ¶¶40-41).
  • Identified Points of Contention:
    • Scope Questions: For the ’494 patent and its relatives, a central question may be the interpretation of the phrase "consisting essentially of." The dispute would concern whether any unlisted excipients in KVK’s formulation materially alter the "basic and novel properties" of the invention, which are described as its low surface tension and non-film-forming nature that facilitates delivery to the nail bed (’494 Patent, col. 4:40-5:4).
    • Technical Questions: A key factual dispute may arise over the negative limitation "does not form a solid film" (’494 Patent, Claim 1). The parties may present conflicting evidence and expert testimony to define what constitutes a "solid film" in this context and to characterize the residue left by KVK's product after the volatile components evaporate. The complaint does not provide the specific formulation of the accused product, so it is unknown if its physical properties, such as surface tension, literally meet the claimed limitations.

V. Key Claim Terms for Construction

  • The Term: "consisting essentially of" (from ’494 Patent, Claim 1)

  • Context and Importance: This transitional phrase defines the scope of the composition. Its construction is critical because if KVK’s generic product contains unlisted ingredients that are found to "materially affect the basic and novel properties" of the patented invention, KVK may avoid infringement. Practitioners may focus on this term to determine if KVK's specific choice of excipients provides a viable non-infringement defense.

  • Intrinsic Evidence for Interpretation:

    • Evidence for a Broader Interpretation (favoring Plaintiffs): The patent repeatedly emphasizes that the key properties are low surface tension and the ability to be wicked into the gap between the nail and nail bed without forming a solid film (’494 Patent, col. 4:40-5:4). A court might construe the term to mean that any additional ingredients that do not interfere with these specific functions do not "materially affect" the invention.
    • Evidence for a Narrower Interpretation (favoring Defendant): The patent specification distinguishes the invention from prior art nail lacquers that form "a substantive nail coating or film" (’494 Patent, col. 2:8-10). A defendant could argue that any unlisted ingredient that contributes to the product's viscosity, drying time, or the nature of its residue materially affects its properties when compared to the specific embodiments disclosed.

  • The Term: "does not form a solid film" (from ’494 Patent, Claim 1)

  • Context and Importance: This negative limitation is a primary point of distinction from prior art nail lacquers. The definition of "solid film" will be dispositive for infringement. If the residue left by KVK's product is deemed a "solid film," it would not infringe.

  • Intrinsic Evidence for Interpretation:

    • Evidence for a Broader Interpretation (favoring Plaintiffs): The background of the ’494 patent describes prior art films as "substantive nail coating," "lacquers, coating, polishes, enamels, and varnishes," and "hard polymeric film" (’494 Patent, col. 2:9; col. 1:43-44; col. 8:66-9:1). This suggests "solid film" should be construed as a hard, durable, lacquer-like layer, and that a softer, oily, or semi-solid residue would not meet this definition.
    • Evidence for a Narrower Interpretation (favoring Defendant): The patent does not provide an explicit definition of "solid film." A defendant might argue for a plain meaning where any non-liquid residue constitutes a "solid film," forcing a factual inquiry into the physical state of the residue left by the accused product.

VI. Other Allegations

  • Indirect Infringement: The complaint alleges that KVK will contributorily infringe and induce infringement of the asserted patents (Compl. ¶¶30, 41). The basis for inducement is the allegation that KVK's proposed product labeling will instruct medical professionals and patients to use the generic product in a manner that directly infringes the asserted method claims (e.g., in the ’506 and ’494 patents).
  • Willful Infringement: The complaint does not contain an explicit allegation of willful infringement. However, the prayer for relief requests a declaration that this is an "exceptional case" under 35 U.S.C. § 285, which is the statutory basis for an award of attorney's fees (Prayer for Relief, ¶12).

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

  • A core issue will be one of claim scope: can the phrase "consisting essentially of," used in claims of the ’494 patent and its progeny, be construed such that the specific excipients in KVK’s generic formulation are found to materially alter the invention's properties, providing a path to non-infringement?
  • A second central question will be one of validity: given the large number of related patents-in-suit covering a single commercial product, the litigation will likely focus on whether the claims of the later-issued patents are non-obvious improvements over the earlier patents and other prior art, raising potential challenges based on obviousness and obviousness-type double patenting.
  • A key evidentiary question will be one of physical characterization: does the residue left by KVK’s product after application constitute a "solid film" as prohibited by certain claims? The resolution of this factual dispute will depend on how the term is construed by the court and the competing expert evidence presented by the parties.