Medicines Company v. Hospira, Inc.
827 F.3d 1363
| Fed. Cir. | 2016Background
- Meds. Co. (MedCo) holds patents (the ’727 and ’343) claiming pH‑adjusted pharmaceutical batches of bivalirudin (Angiomax) with a maximum Asp[9] impurity of ~0.6%; applications filed July 27, 2008 (critical date July 27, 2007).
- MedCo contracted Ben Venue to manufacture three validation batches in late 2006 (paid ~$347,500), producing tens of thousands of vials worth millions on the open market; title remained with MedCo and batches were quarantined pending FDA approval.
- MedCo later entered a February 2007 distribution agreement making ICS an exclusive U.S. distributor; title and risk of loss passed to ICS only after release from quarantine (release occurred in August 2007, after the critical date).
- Hospira filed ANDAs seeking to market generic bivalirudin and argued MedCo’s pre‑critical‑date transactions triggered the § 102(b) on‑sale bar; district court found no invalidating commercial sale and also found noninfringement; a panel reversed on on‑sale grounds and the case was reheard en banc.
- The en banc Federal Circuit clarified that Pfaff’s first prong requires a commercial sale/offer in the UCC sense; it held that (1) sale of contract manufacturing services that leaves title and marketing control with the inventor is not a commercial sale of the patented product, and (2) mere stockpiling/preparations without a commercial offer/sale do not trigger § 102(b).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Ben Venue’s manufacture before the critical date made the claimed product "on sale" under § 102(b) | MedCo: Transactions were confidential contract manufacturing services; title and marketing control remained with MedCo, so no sale of the claimed invention | Hospira: Paying a third party to make embodiments for commercial use and stockpilement constitutes commercial exploitation triggering the on‑sale bar | Held: No. Sale of manufacturing services where title/marketing rights remain with inventor is not a § 102(b) commercial sale of the claimed product |
| Whether stockpiling by an inventor (via a contract manufacturer) triggers the on‑sale bar | MedCo: Stockpiling is pre‑commercial activity and does not trigger § 102(b) absent an actual sale or offer for sale | Hospira: Stockpiling provided commercial benefit and replenished commercial pipeline, so it triggers the bar | Held: No. Mere stockpiling/preparations without a commercial offer/sale do not trigger § 102(b) |
| Whether a "supplier exception" to the on‑sale bar exists (i.e., transactions with suppliers should be exempt) | MedCo: Court should hold that hiring a third party to confidentially manufacture for the inventor does not trigger § 102(b) | Hospira: No supplier exception; corporate economics and commercial exploitation can trigger the bar even if supplier is used | Held: No blanket supplier exception; but supplier→inventor transactions are a key indicator—if title, marketing rights, or a full‑value sale exist, § 102(b) can apply |
| Whether the experimental‑use doctrine saves MedCo (batches were for validation) | MedCo: Batches were for validation/experimental purposes, not commercial marketing | Hospira: MedCo did not press experimental‑use below; validation for FDA and post‑reduction‑to‑practice batches suggest commercial purpose | Held: Court did not decide experimentally because it resolved the case on the lack of a commercial sale; therefore experimental‑use issue left for lower court if needed |
Key Cases Cited
- Pfaff v. Wells Elecs., Inc., 525 U.S. 55 (Sup. Ct.) (two‑part on‑sale test: commercial offer for sale and ready for patenting)
- Group One, Ltd. v. Hallmark Cards, Inc., 254 F.3d 1041 (Fed. Cir.) (use UCC to assess commercial offer for sale)
- Special Devices, Inc. v. OEA, Inc., 270 F.3d 1353 (Fed. Cir.) (no blanket supplier exception where transaction otherwise is a commercial sale)
- D.L. Auld Co. v. Chroma Graphics Corp., 714 F.2d 1144 (Fed. Cir.) (performance of claimed method for customers can trigger on‑sale bar)
- Metallizing Eng’g Co. v. Kenyon Bearing & Auto Parts Co., 153 F.2d 516 (2d Cir.) (commercial use for profit can invalidate patent if pre‑filing)
- Brasseler, U.S.A. I, L.P. v. Stryker Sales Corp., 182 F.3d 888 (Fed. Cir.) (transaction was a commercial sale in the UCC sense)
- Hamilton Beach Brands, Inc. v. Sunbeam Prods., 726 F.3d 1370 (Fed. Cir.) (post‑Pfaff application of on‑sale bar focusing on commercial offer and readiness)
- Trading Techs. Int’l, Inc. v. eSpeed, Inc., 595 F.3d 1340 (Fed. Cir.) (transaction must be a sale in a commercial‑law sense)
- Amgen Inc. v. F. Hoffmann‑La Roche Ltd., 580 F.3d 1340 (Fed. Cir.) (product‑by‑process claims are assessed based on the product for validity)