Two Bass IPRs fail at PTAB but more cases filed
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Two Bass IPRs fail at PTAB but more cases filed

Kyle Bass

The PTAB has declined to institute inter partes reviews brought against two of Acorda Therapeutic's patents covering its multiple-sclerosis drug, finding that the posters cited in evidence did not qualify as prior art

Kyle Bass

Yesterday's rulings are setbacks to the Coalition for Affordable Drugs' campaign to file IPRs against pharmaceutical patents, though it has filed new cases against three pharmaceutical companies in the past week.

According to critics, fund manager Kyle Bass (right) and nXn owner Erich Spangenberg, who formed the Coalition, are using IPRs to drive down share prices of patent holders in order to benefit from short positions on those stocks. Following yesterday’s rulings, Acorda’s shares surged 28%.

The Coalition had targeted two US patents (numbers 8,007,826 B2 and 8,663,685 B2) covering Acorda's Ampyra drug on the ground of obviousness, citing as evidence two posters that it argued constituted prior art. In two separate but largely identical written decisions, the PTAB disagreed, finding that the two posters were not prior art because they were not "printed publications".

The Board noted that the Coalition did not state that the posters were distributed and indexed, leading it to look at four factors to determine whether the posters were printed publications. The four factors are:

1. the length of time of the display;

2. the expertise of the target audience;

3. whether there were expectations that the displayed materials would not be copied; and

4. the ease with which the material would have been copied.

Analysing the posters under these factors, the Board found that the Coalition presented no evidence as to the length of time of display and the expertise of the target audience. It also found that the information on the posters was densely packed and complex, making it hard to copy.

Because of these four findings, the Board found that the Coalition did not show that the posters were printed publications, and thus did not constitute prior art under Section 102(b).

The battle and the war

In the past week alone, the Coalition has filed three IPRs against patents owned by Insys Pharma, Hoffman-La Roche and Anacor Pharmaceuticals

The Coalition's attack on Acorda's patents is part of its campaign to challenge pharmaceutical patents through the use of IPRs.

Both supporters and opponents of patent reform have criticised the group, with Darrell Issa arguing that Bass and Spangenberg's actions should be illegal and Gene Quinn pointing to the IPRs as an unintended consequence of earlier attempts to reform the patent system with the AIA.

The Coalition's targets are also fighting back, with Celgene moving for sanctions on the grounds that the IPRs are motivated by profit.

However, the Coalition is unlikely to be disappearing anytime soon. Even though its IPRs against Acorda's patents have failed, it has 26 cases pending, including its action against Celgene.

In the past week alone, the Coalition has filed three IPRs against patents owned by Insys Pharma (filed by Law Offices of Gregory J Gonsales and McNeeley Hare & War on August 24), one challenging a patent owned by Hoffman-La Roche (filed by Neifeld IP Law on August 22) and three against patents owned by Anacor Pharmaceuticals (filed by Merchant & Gould on August 20).

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