lllumina, Intelligent Bio-Systems Spar Over Sequencing Patent

Stay ahead of developments in federal and state health care law, regulation and transactions with timely, expert news and analysis.

By John T. Aquino

March 10 — Illumina Inc. and Intelligent Bio-Systems Inc. squared off in a federal appeals court March 9 in the latest challenge of each other's DNA-sequencing patents.

Intelligent Bio-Systems sued Illumina, which earned $2.2 billion in 2015 global revenue mostly as a result of its next-generation sequencing (NGS) technology, for patent infringement in federal district court, and Illumina counterclaimed, which is why the validity of both companies' patents is so important. They challenged the patents in trials at the Patent and Trademark Office's patent board, whose decisions were then appealed.

So far, Illumina has been able to convince the U.S. Court of Appeals for the Federal Circuit to agree that three patents owned by Columbia University, for which Intelligent Bio-Systems is the exclusive licensee, are invalid . Intelligent Bio-Systems was able to do the same for two of Illumina's patents.

‘Aren't You Stuck' With It?

In the latest oral arguments before the Federal Circuit, Intelligent Bio-Systems contended that the Patent Trial and Appeal Board erred in concluding that the patent-at-issue in these proceedings wasn't invalid as obvious in light of prior publications and patents and that the board shouldn't have excluded the new arguments and evidence that Intelligent Bio-Systems submitted in its reply brief.

But Judge Kathleen M. O'Malley began the proceedings by asking Intelligent Bio-Systems' counsel Robert R. Baron of Ballard Spahr LLP, Philadelphia, “But isn't the problem that you chose a very specific motivation to argue before the board as to why an ordinary artisan in the field would have combined prior patents and studies, thus making the claim obvious, and aren't you stuck with that?”

Representing Illumina, William R. Zimmerman of Knobbe, Martens, Olson & Bear LLP, Washington, had to address the court's questions as to whether or not the PTAB applied the correct legal standard in its ruling.

Board Found Claims Not Obvious

The patent at issue is U.S. Patent No. 7,566,537 (“Labelled nucleotides,” issued 7/28/09), which is directed to methods of labeling a nucleic acid molecule with a non-natural, labeled nucleotide. It demonstrates sequencing by synthesis (SBS), a process used to identify the sequence of nucleotides in DNA by synthesizing a single strand of DNA using nucleotides that complement the nucleotides in a sample single strand of DNA. SBS is a type of NGS, which is a component of precision or personalized medicine.

In its PTAB petition, Intelligent Bio-Systems cited the prior art of Roger Y. Tsien's patent application WO 91/06678, which described a method for SBS using modified nucleotides with a removable 3′-protecting group; U.S. Patent No. 6,664,079 (“Massive parallel method for decoding DNA and RNA,” issued 12/16/03), referred to as the “Ju patent” after one of its inventors; and a 1991 study by Sergey Zavgorodny, which teaches the use of azidomethyl as a block for the 3-OH of a modified nucleoside, a component of a nucleotide. It argued that one with skill in the art would have been motivated to improve the SBS methods of Tsien or Ju by combining them with the work of Zavgorodny, so the claims-at-issue in the '537 patent are obvious and unpatentable.

Illumina responded that Zavgorodny would have dissuaded a person of ordinary skill from using azidomethyl as a protecting group because the skilled artisan would have concluded that azidomethyl couldn't be removed efficiently enough to satisfy Tsien’s or Ju’s sequencing methods.

In its reply brief, Intelligent Bio-Systems argued that the prior art could be combined “to show the obviousness of the claims for embodiments other than SBS, such as methods of labeling a nucleic acid molecule” and included a reply declaration by its expert witness.

The PTAB concluded that the evidence didn't show that an ordinary artisan would have combined the prior art in the manner Intelligent Bio-Systems suggested. It referenced the company’s expert's testimony that “quantitative deblocking” was understood to mean essentially 100 percent removal of the protecting group and then cited prior art showing that an ordinary artisan wouldn't have expected the azidomethyl protecting group of Zavgorodny to be removed with essentially 100 percent efficiency.

The board also found that Intelligent Bio-Systems’s reply brief exceeded its permissible scope because it offered new theories of unpatentability and improperly incorporated explanations and supporting evidence presented in reply declarations.

Question of ‘Motivation.'

When O'Malley kept emphasizing the “motivation” that Intelligent Bio-Systems had outlined in its PTAB petition, Baron responded, “Motivation is a flexible, expansive culture.”

“But you kept referring back to the motivation to combine Tsien and Ju,” O'Malley said.

“Or the purpose,” Baron responded.

O'Malley acknowledged that the terminology in the PTAB's written opinion wasn't precise but responded that the court still had to look at the PTAB's finding of fact and at the testimony of Intelligent Bio-Systems' expert witness.

Baron stressed that the board had erred by accepting Illumina’s “misguided argument” that a skilled artisan also would demand from a protecting group the ability, discussed in Ju and Tsien, to be cleaved with high efficiency if it was being used for SBS.

“The board measured the skilled artisan’s likelihood of success in terms of the likelihood of achieving this high cleavage requirement rather than by the limitations in the claimed invention, which ignored the Federal Circuit's clear mandate in 726 F.3d 1286, 1292 (Fed. Cir. 2013) 2013 BL 115500, that the reasonable expectation of success must only be measured by the claimed invention,” he said.

Expectation of Success

In response to the court's questions about Intelligent Bio-Systems' argument that the PTAB had used an improper standard on evaluating expectation of success, Zimmerman said that the PTAB had used the right standard but that the portions of the PTAB's written opinion Intelligent Bio-Systems had quoted in its brief had dealt with motivation to combine rather than expectation of success. “What they were quoting was the board responding to what it had been asked,” Zimmerman said.

Zimmerman told the court, “IBS also cannot show that the board erred in rejecting IBS’s argument that an ordinary artisan could have combined Tsien or Ju with Zavgorodny by departing from the conditions of Zavgorodny. The board properly found that this argument wasn't part of IBS’s prima facie case and that IBS’s evidence was insufficient to show that an ordinary artisan would have expected other conditions to work with the SBS criteria of Tsien or Ju. These findings are also supported by substantial evidence.”

The Federal Circuit panel hearing the case was composed of O'Malley and Judges Evan M. Wallace and Todd M. Hughes.

To contact the reporter on this story: John T. Aquino in Washington at jaquino@bna.com

To contact the editor responsible for this story: Lee Barnes at lbarnes@bna.com

Request Health Care on Bloomberg Law