Helsinn Healthcare v. Teva Pharmaceuticals

Whether, under the Leahy-Smith America Invents Act, an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention.

Petitioner, a Switzerland pharmaceutical company, owns four patents on a medication. Underestimating the cost of developing the drug for use in the United States, Petitioner entered into contracts with an American business partner to offset the cost of development.  The contracts bound the business partner to keep confident the medication’s proprietary information. After the FDA approved Petitioner’s new medication, Respondent drug manufacturer sought the FDA’s approval for a generic version of the drug. Petitioner filed suit against Respondent alleging that its Abbreviated New Drug Application (ANDA) constituted a patent infringement. Petitioner argues that the drug was “prior art” under the Leahy-Smith America Invents Act (AIA). Also under the Act, a person is entitled to a patent unless the invention was “on sale or otherwise available to the public.” 35 U.S.C. Section 102(a). The district court held that the ANDA constituted an infringement of Petitioner’s valid patent, rejecting Respondent’s claim that Petitioner’s agreements with the business partner invalidated the patent under the “on sale” provision. The Federal Circuit reversed reasoning that the on-sale bar was satisfied where there is an offer to sell and the sale is made public. The Supreme Court granted certiorari to resolve the question of whether, under the AIA, an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention.