Bass IPR Against Jazz

Filed on behalf of Petitioner
COALITION FOR AFFORDABLE DRUGS III LLC

By:
Daniel W. McDonald, Esq.

MERCHANT & GOULD P.C.
3200 IDS Center
80 South 8th Street
Minneapolis, MN 55402-2215
dmcdonald@merchantgould.com
Main Telephone: (612) 332-5300
Main Facsimile: (612) 332-9081
UNITED STATES PATENT AND TRADEMARK OFFICE
_____________________
BEFORE THE PATENT TRIAL AND APPEAL BOARD
_____________________
COALITION FOR AFFORDABLE DRUGS III LLC
Petitioner
v.
JAZZ PHARMACEUTICALS, INC.
Patent Owner
_____________________
Case No. To Be Assigned
Patent No. 7,895,059
_____________________
PETITION FOR INTER PARTES REVIEW OF U.S. PATENT NO. 7,895,059

UNDER 35 U.S.C. 311319 AND 37 C.F.R. 42.100
TABLE OF CONTENTS
I.
INTRODUCTION ...........................................................................................1
II.
MANDATORY NOTICES .............................................................................2

A.
The Real Party-In-Interest (37 C.F.R. 42.8(b)(1)) .................................2
B.
Notice of Related Matters (37 C.F.R. 42.8(b)(2))..................................3
C.
Designation of Lead and Back-Up Counsel ..............................................5
D.
Notice of Service Information (37 C.F.R. 42.8(b)(4)) ...........................6
III.
PAYMENT OF FEES .....................................................................................6
IV.
REQUIREMENTS UNDER 37 C.F.R. 42.104 ............................................6
V.
VI.
A.
Grounds for Standing ................................................................................6
B.
Identification of Challenge and Precise Relief Requested ........................7

1.
Specific Art and Statutory Ground on Which the Challenge is

Based .................................................................................................7
2.
Evidence Relied Upon to Support the Challenge ..............................8
OVERVIEW ....................................................................................................8
A.
Person of Ordinary Skill In The Art..........................................................8
B.
Overview of the 059 Patent .....................................................................9
C.
State of the Prior Art ...............................................................................11
Claim Construction ........................................................................................18
VII. CLAIMS 1-16 ARE INVALID AS OBVIOUS OVER

COMBINATIONS OF LILLY, THE DAC TRANSCRIPT AND THE
CSR ................................................................................................................20
A.
Each Of The References Cited Is Available Prior Art. ...........................21

1.
Lilly and Camarda are 102(e) prior art.........................................21

i
2.
B.
Ground 1: Claims 1-6, 9 and 12-14 are obvious over Lilly in view
of the DAC Transcript and Camarda. .....................................................27
1.
C.
D.
The DAC Transcript and the CSR are printed publications

that qualify as 102(b) prior art......................................................23
The Combination of Lilly, the DAC Transcript and Camarda

Discloses All of the Elements of claims 1-6, 9 and 12-14 of
the 059 Patent .................................................................................29
Ground 2: Claims 7-8, 10-11 and 15-16 are obvious over Lilly in
view of the DAC Transcript, Camarda and the CSR. .............................55
1.
There is a motivation to combine Lilly, the DAC Transcript,

Camarda and the CSR .....................................................................55
2.
The Combination of Lilly, the DAC Transcript, Camarda and

the CSR discloses all of the elements of claims 7-8, 10-11 and
15-16 ................................................................................................56
No evidence of secondary considerations rebuts the showing that

claims 1-16 are obvious ..........................................................................60
VIII. CONCLUSION..............................................................................................60
ii
TABLE OF AUTHORITIES
Cases
Custom Accessories, Inc. v. Jeffrey-Allan Indus., Inc.,
807 F.2d 955 (Fed. Cir. 1986)...................................................................... 8
EMC Corp. v. Personal Web Techs., LLC, IPR2013-00084 (P.T.A.B.) ....... 23
Graham v. John Deere Co., 383 U.S. 1 (1966) ............................................. 21
In re Giacomini, 612 F.3d 1380 (Fed. Cir. 2010) .................................... 21, 22
In re GPAC, 57 F.3d 1573 (Fed. Cir. 1995) .................................................... 8
In re Klopfenstein, 380 F.3d 1345 (Fed. Cir. 2004) ................................ 23, 24
In re Wyer, 655 F.2d 221 (CCPA 1981) ........................................................ 25
KSR Intl Co. v. Teleflex, Inc., 550 U.S. 398 (2007) ................................. 8, 21
Leo Pharm. Prods., Ltd. v. Rea, 726 F.3d 1346 (Fed. Cir. 2013) ................. 60
SRI Intl, Inc. v. Internet Sec. Sys., Inc.,
511 F.3d 1186 (Fed. Cir. 2008).................................................................. 23
Veeam Software Corp. v. Symantec Corp., IPR2013-00142 (P.T.A.B.) ....... 25
Voter Verified, Inc. v. Premier Election Solutions, Inc.,
698 F.3d 1374 (Fed. Cir. 2012).................................................................. 23
Statutes
35 U.S.C. 102 ............................................................................ 23, 26, 27, 29
35 U.S.C. 103 .......................................................................................... 7, 21
35 U.S.C. 315 ................................................................................................ 7
35 U.S.C. 318 ................................................................................................ 6
35 U.S.C. 311-319 ...................................................................................... 1
Rules
37 C.F.R. 42.6 ............................................................................................... 8
37 C.F.R. 42.8 ................................................................................... 2, 3, 5, 6
37 C.F.R. 42.10 ............................................................................................. 8
iii
37 C.F.R. 42.63 ............................................................................................. 8

37 C.F.R. 42.100 ..................................................................................... 1, 18
37 C.F.R. 42.102 ....................................................................................... 6, 7
37 C.F.R. 42.104 ....................................................................................... 6, 7
Other Authorities
M.P.E.P. 2141.03 .......................................................................................... 8
The Federal Advisory Committee Act, 5 U.S.C. App 2 10(b) .................... 25
iv
I.
INTRODUCTION
The Coalition for Affordable Drugs III LLC (Petitioner or CFAD)
respectfully requests inter partes review (IPR) of claims 1-16 of U.S. Patent No.
7,895,059 (the 059 Patent) (Ex. 1001) in accordance with 35 U.S.C. 311-319
and 37 C.F.R. 42.100. Claims 1-16 of the 059 Patent, which is assigned to Jazz
Pharmaceuticals, Inc. (the Patent Owner), are directed to [a] computerized
method of distributing a prescription drug under exclusive control of an exclusive
central pharmacy. (See, e.g., Ex. 1001, col. 8:37-9:3.) The specific prescription
drug identified in certain claims of the 059 Patent is gamma hydroxyl butyrate
(GHB), which is marketed under the trade name Xyrem by the Patent Owner.
The claims of the 059 Patent are unpatentable because they would have
been obvious to a person of ordinary skill in the art (POSA) as of the time of
filing of the patent. Specifically, the combination of U.S. Published Application
No. 2004/0176985 to Lilly et al. (Lilly) (Ex. 1002), the published transcript of an
FDA Drug Advisory Committee Meeting relating to Xyrem (the DAC
Transcript) (Ex. 1003), and U.S. Patent No. 6,587,829 (Camarda) renders
obvious to a POSA the limitations of claims 1-6, 9 and 12-14 of the 059 Patent, as
set forth below in Ground 1. Further, a published Preliminary Clinical Safety
Review of the NDA for Xyrem (the CSR) (Ex. 1004), in combination with
Lilly, the DAC Transcript and Camarda, renders obvious the limitations of
challenged claims 7-8, 10-11 and 15-16 obvious, as set forth below in Ground 2.
For the reasons explained herein, Petitioner is likely to prevail on the
asserted Grounds 1 and/or 2 with respect to the challenged claims. Petitioner
requests that this Board institute an IPR and cancel claims 1-16 of the 059 Patent.
II.
MANDATORY NOTICES
A.
The Real Party-In-Interest (37 C.F.R. 42.8(b)(1)
Pursuant to 37 C.F.R. 42.8(b)(1), Petitioner certifies that Coalition For

Affordable Drugs III LLC (CFAD), Hayman Credes Master Fund, L.P.
(Credes), Hayman Orange Fund SPC Portfolio A (HOF), Hayman Capital
Master Fund, L.P. (HCMF), Hayman Capital Management, L.P. (HCM),
Hayman Offshore Management, Inc. (HOM), Hayman Investments, L.L.C.
(HI), nXn Partners, LLC (nXnP), IP Navigation Group, LLC (IPNav), J
Kyle Bass, and Erich Spangenberg are the real parties in interest (collectively,
RPI). The RPI hereby certify the following information: CFAD is a wholly
owned subsidiary of Credes. Credes is a limited partnership. HOF is a segregated
portfolio company. HCMF is a limited partnership. HCM is the general partner and
investment manager of Credes and HCMF. HCM is the investment manager of
HOF. HOM is the administrative general partner of Credes and HCMF. HI is the
general partner of HCM. J Kyle Bass is the sole member of HI and sole
shareholder of HOM. CFAD, Credes, HOF and HCMF act, directly or indirectly,
through HCM as the general partner and/or investment manager of Credes, HOF
and HCMF. nXnP is a paid consultant to HCM. Erich Spangenberg is 98.5%
member of nXnP. IPNav is a paid consultant to nXnP. Erich Spangenberg is the
98.5% member of IPNav. Other than HCM and J Kyle Bass in his capacity as the
Chief Investment Officer of HCM and nXnP and Erich Spangenberg in his
capacity as the Manager/CEO of nXnP, no other person (including any investor,
limited partner, or member or any other person in any of CFAD, Credes, HOF,
HCMF, HCM, HOM, HI, nXnP or IPNav) has authority to direct or control (i) the
timing of, filing of, content of, or any decisions or other activities relating to this
Petition or (ii) any timing, future filings, content of, or any decisions or other
activities relating to the future proceedings related to this Petition. All of the costs
associated with this Petition are expected to be borne by HCM, CFAD, Credes,
HOF and/or HCMF.
B.
Notice of Related Matters (37 C.F.R. 42.8(b)(2)
Petitioner has knowledge that the 059 Patent is subject matter in the
following litigations that could affect, or be affected by, a decision in this
proceeding: Jazz Pharms, Inc. v. Watson Labs., Inc., 2:14-cv-07757 (D.N.J. Dec.
11, 2014); Jazz Pharms, Inc. v. Ranbaxy Labs., Ltd., 2:14-cv-04467 (D.N.J. July
15, 2014); Jazz Pharms., Inc. v. Amneal Pharms., LLC, 2:13-cv-00391 (D.N.J.
Dec. 27, 2013) (consolidated with Jazz Pharms., Inc. v. Amneal Pharms., LLC,
2:13-cv-5450 (D.N.J.) and Jazz Pharms, Inc. v. Par Pharm., Inc., 2:13-cv-07884
(D.N.J.)); and Jazz Pharms, Inc. v. Roxane Laboratories, Inc., 2:10-cv-06108
(D.N.J. Nov. 22, 2010) (consolidated with Jazz Pharms, Inc. v. Roxane
Laboratories, Inc., 2:11-cv-00660 (D.N.J.); Jazz Pharms, Inc. v. Roxane
Laboratories, Inc., 2:11-cv-07459 (D.N.J.)).
The 059 Patent also is subject of an inter partes review petition: Par
Pharmaceutical, Inc. et al. v. Jazz Pharms., Inc, (IPR2015-00548, filed January 8,
2015. Additionally, the following patents related to the 059 Patent are subject to
inter partes review petitions: U.S. Patent No. 7,765,107 is the subject of IPR 201500547 (Amneal Pharms., LLC v. Jazz Pharms, Inc.), filed January 8, 2015, which
is pending (no decision on institution yet). U.S. Patent No. 7,668,730 is the subject
of IPR 2015-00554 (Par Pharms., Inc. v. Jazz Pharms, Inc.), filed January 8, 2015,
which is pending (no decision on institution yet). U.S. Patent No. 7,765,106 is the
subject of IPR 2015-00546 (Amneal Pharms., LLC v. Jazz Pharms, Inc.), filed
January 8, 2015, which is pending (no decision on institution yet). U.S. Patent No.
8,457,988 is the subject of IPR 2015-00551 (Par Pharms., Inc. v. Jazz Pharms,
Inc.), filed January 8, 2015, which is pending (no decision on institution yet). U.S.
Patent No. 8,589,182 is the subject of IPR 2015-00545 (Amneal Pharms., LLC v.
Jazz Pharms., Inc.), filed January 8, 2015, which is pending (no decision on
institution yet).
C.
Designation of Lead and Back-Up Counsel
Pursuant to 37 C.F.R. 42.8(b)(3) and 42.10(a), Petitioner hereby

identifies its lead and backup counsel as shown below. A Power of Attorney is
being filed concurrently herewith in accordance with 37 C.F.R. 42.10(b).
Lead Counsel
Registration No. 32,044
3200 IDS Center
80 South 8th Street
Main Telephone: 612.332.5300
Main Facsimile: 612.332.9081
Back-Up Counsel
Jeffrey D. Blake, Esq.
191 Peachtree Street N.E., Suite 4300
Atlanta, GA 30303
jblake@merchantgould.com
jblake@merchantgould.com
Thomas J. Leach, Esq.
Brent E. Routman
(Pro Hac Vice)
3200 IDS Center
80 South 8th Street
tleach@merchantgould.com
D.
Notice of Service Information (37 C.F.R. 42.8(b)(4))
Please direct all correspondence to counsel at the above address. CFAD

consents to email service at: jblake@merchantgould.com and
XyremIPR@merchantgould.com.
III.
PAYMENT OF FEES
Payment of $26,200.00 for the fees set forth in 37 C.F.R. 42.15(a) (1-4) for
this Petition For Inter Partes Review accompanies this request by way of credit
card payment. Sixteen claims are challenged, so no excess claim fees are included.
The undersigned further authorizes payment for any additional fees that might be
due in connection with this Petition to be charged to Deposit Account No. 13-2725.
IV.
REQUIREMENTS UNDER 37 C.F.R. 42.104

A.
Grounds for Standing
Pursuant to 37 C.F.R. 42.104(a), Petitioner hereby certifies that the 059

Patent is available for inter partes review under 37 C.F.R. 42.102(a)(2), and that
the Petitioner is not barred or estopped from requesting inter partes review
challenging the claims of the 059 Patent on the grounds identified in this Petition.
None of Petitioner, any real party in interest, or any privy of Petitioner has
received a final written decision under 35 U.S.C. 318(a) with respect to any
claim of the 059 Patent on any ground that was raised or could have been raised
by Petitioner, any real party in interest, or any privy of Petitioner in any inter
partes review, post grant review, or covered business method patent review.
6
Further, Petitioner certifies that: (1) Petitioner has not filed a civil action
challenging the validity of a claim of the 059 Patent; (2) none of the Petitioner, the
Petitioners real party-in-interest, or a privy of the Petitioner was served with a
complaint alleging infringement of the 059 Patent; (3) the estoppel provisions of
35 U.S.C. 315(e)(1) do not prohibit this inter partes review; and (4) the 059
Patent is not a patent described in section 3(n)(1) of the Leahy-Smith America
Invents Act and so is available for this inter partes review, per 37 C.F.R. 42.102
(a)(2).
B.
Identification of Challenge and Precise Relief Requested

1.
Specific Art and Statutory Ground on Which the Challenge

is Based
Pursuant to 37 C.F.R. 42.104 (b), Petitioner challenges Claims 1-16 of the

059 Patent. Claims 1-16 of the 059 Patent are unpatentable because they would
have been obvious under 35 U.S.C. 103(a) in view of the combined teachings of
Lilly, the DAC Transcript, Camarda and the CSR. Specifically, Claims 1-6, 9 and
12-14 of the 059 Patent are invalid as obvious over Lilly in view of the DAC
Transcript and Camarda. (See Exs. 1002-1004, 1006.) Claims 7-8, 10-11 and 15-16
of the 059 Patent are invalid as obvious over Lilly in view of the DAC Transcript,
Camarda and the CSR. (See Exs. 1002-1006.)
2.
Evidence Relied Upon to Support the Challenge
Petitioner relies upon each of exhibits cited herein. Petitioner also relies
upon the Declaration of Dr. Jeffrey Fudin (Ex. 1006), and the documents cited
therein. Attached are a Power of Attorney, an Exhibit List, and copies of the
references per 37 C.F.R. 42.10(b), 42.63(e), and 42.6 (c).
V.
OVERVIEW
A.
Person of Ordinary Skill In The Art
A POSA is a hypothetical person who is presumed to be aware of all

pertinent art. M.P.E.P. 2141.03. Factors that may be considered in determining
the level of ordinary skill in the art include: (A) the type of problems encountered
in the art; (B) prior art solutions to those problems; (C) rapidity with which
innovations are made; (D) sophistication of the technology; and (E)
educational level of active workers in the field. In re GPAC, 57 F.3d 1573, 1579
(Fed. Cir. 1995); Custom Accessories, Inc. v. Jeffrey-Allan Indus., Inc., 807 F.2d
955, 962, (Fed. Cir. 1986). A person of ordinary skill in the art is also a person of
ordinary creativity, not an automaton. KSR Intl Co. v. Teleflex Inc., 550 U.S. 398,
421, 82 USPQ2d 1385, 1397 (2007).
As explained in the Declaration of Dr. Fudin, a POSA as of the earliest
effective filing date of 059 Patent would hold a Bachelors or Doctor of Pharmacy
(Pharm.D.) degree and a license as a registered pharmacist with 3-5 years of
relevant work experience. (Ex. 1006 at 38-41.) A POSA, as a practicing

pharmacist, would also have extensive experience using computer systems and
databases to order drug and medical supplies, dispense drugs, and search for
information regarding drugs. (Id.) Moreover, a POSA would also have experience
receiving prescriptions by fax or telephone. (Id.) A POSA would also be generally
aware of all Federal and State regulations regarding the acquisition and distribution
of pharmaceuticals. (Id. at 4.) A POSA would be familiar with New Drug
Applications (NDA), the various Federal Drug Administrations (FDA)
regulations, the general process for obtaining FDA approval for a drug, and where
to locate such information. (Id. at 41.)
B.
Overview of the 059 Patent
The 059 Patent relates to [a] drug distribution system and method [that]
utilizes a central pharmacy and database to track all prescriptions for a sensitive
drug. (Ex. 1001, Abstract and col. 1:44-46; see also Ex. 1006 at 89-101.) The
central pharmacy stores data about the prescription patterns of physicians and
patients. (Id. at Abstract and col. 2:16-18.) The stored data may include a
physicians contact information as well as license number, DEA number and
physician specialty. (Id. at col. 4:24-26; see also id. at col. 2:16-21.) The data
also may include a patients name, social security number, date of birth, contact
information, drug identification, [the] patients appropriate dosage, and number of
refills allowed. (Id. at col. 4:26-29.) The data is entered into an application/
database referred to as CHIPS, which is used to maintain a record of a client home
infusion program (CHIP) for drug products such as Xyrem. (Id. at col. 4:34-39.)
This central database is used to monitor for patterns of abuse of drug products such
as Xyrem by verifying that (1) a physician should be allowed to prescribe a drug
product and (2) a patient receiving a drug product does not have a history of abuse.
(Id. at col. 1:46-58.)
The 059 Patent also describes that education material is provided to both
the patient and the physician. For example, the patent discloses that [p]rior to
shipping the drug for the first time, the patient is contacted to ensure that product
and abuse related education materials have been received and/or read. (Id. at col.
1:59-62.) Once the patient confirms that the educational materials have been
reviewed, the drug product is shipped from the central pharmacy to the patient. (Id.
at col. 1:62-2:3.) Alternatively, the drug product may be shipped by the central
pharmacy to another pharmacy for the patient to pick it up there. (Id. at col. 2:4-8.)
Finally, the 059 Patent discloses that reports and queries can be run from
the database to provide information that might reveal potential abuse or misuse of
the drug. (Id. at col. 2:19-21.)
10
C.
State of the Prior Art
Risk management programs to help control the distribution of prescription

drug products with the potential for abuse or potentially dangerous side effects
were developed in the 1980s and 1990s. (Ex. 1006 at 43.) During that time,
pharmacies began using computerized systems for the distribution of controlled
substances, i.e., drugs with potential for abuse. (Id.) Pharmacies implemented these
computerized systems to help them prevent the abuse of controlled substances,
notify patients of side effects experienced when taking prescription medications,
reduce the time necessary for dispensing drug products, and improve accuracy and
accountability in the dispensing process. (Id.) Automation was the order of the day
as computers became more prevalent in pharmacies around the country.
These computerized systems were particularly helpful in generating reports
tracking patients who were receiving excessive supplies of controlled substances.
(Id., 45.) Distribution of controlled substances could be associated with
information identifying the patient, the prescribing doctor, the quantity of the drug
dispensed, and the hospital inventory of a drug. (Id.) And, the systems could be
queried to provide data, such as prescriptions by doctor and patient. (Id.) These
systems allowed for detecting patterns of abuse, as described in more detail below.
(Id. at 52-55.)
11
Lilly Lilly is one example of a prior art computerized system that was used
to track prescription data to prevent misuse and abuse of controlled substances.
(Ex. 1002 at Abstract; see also Ex. 1006 at 46-48, 57-62.) Specifically, Lilly
discloses a computerized method for tracking prescriptive medications that stores
the information in a central location. (Id.; see also id. at 0050-0051.) The
stored data for each prescriptive medication transaction includes searchable data
such as the patients name, address, doctor, pharmacy, aberrant use flag, and the
like. (Id. at Abstract.)
In discussing the background of the pharmaceutical industry, Lilly describes
estimates that show more than four million people a year in the U.S. misuse or
abuse prescription drugs. (Id. at 0004.) Further, according to Lilly, [t]he AMA
estimates that 5% of physicians are grossly negligent and 1-1.5% are dishonest in
their prescribing of pharmaceuticals, which amounted to a cost of about $2.5
billion annually in the early 2000s. (Id. at 0005.) Lilly describes its goal as
reducing the misuse and abuse of prescription drug products:
It would be desirable to provide a healthcare utility that can
assist substantially in reducing these misused and abused
prescriptions. It would be desirable to provide major changes in
the delivery of prescription drug products that produce
measureable social and economic impacts on spending within
the healthcare value chain including less abuse-related
healthcare costs, fewer erroneous prescriptions, more
12
accountability, and better tracking and management of

prescriptions.
(Id. at 0012 (emphasis added); see also id. at 0009, 0054 and 0057.)
Lilly maintains patients prescription medication information in a central
database accessible through a secure computer connection that allows health care
providers to access a complete prescriptive medication history of the patient
including prescriptive medications by other doctors. (Id. at 0037, 0050.) The
Lilly system uses a pharmaceutical information control organization as a central
location or database for storing the prescription history of patients. (Id. at 0051,
0061.) Using that pharmaceutical information control organization, a physician or
other medical provider can search the Lilly system to see if the patient has been
prescribed a certain drug by another doctor or whether the patient has attempted to
fill a prescription more than once. (Id. at 0054.) Likewise, the Lilly system
allows a pharmacist to use the database to determine whether the purchaser of the
prescription should receive the prescription. (Id. at 0039.) Based on a search of
the database, the pharmacist can accept or decline filling the prescription. (Id.)
Lilly specifically discloses that the pharmaceutical computer data for each
prescription medication purchaser (i.e., a patient) includes a name of the patient,
the patients address, the drug prescribed, the quantity of the drug prescribed, the
dosage, the name of the physician that prescribed the drug, and the name of the
13
pharmacist that filled the prescription. (Id. at 0041.) This information allows
users of the system to identify and track patterns of abuse or misuse, including by
generating reports tracking patients who were receiving excessive supplies of
controlled substances. (Id. at 0072.)
Camarda Camarda discloses a method and apparatus for improving
patient compliance with prescriptions using a computerized system to convert
prescription information into electronic form as records for each patient. (Ex.
1004 at Abstract; see also id. at col. 4:49-55 and Figures 1-3.) Each such patient
record includes information about the patient from the prescription and the
prescription itself. (Id. at Abstract; see also Ex. 1006 at 75-78.) In addition,
demographic information about the patient is obtained from other commercial
databases and added to the patient record.(Id.)
The information in the patients record is analyzed to determine which
patients are most likely to fail to comply with their prescription. (Id. at col. 2:5560; Fig. 5.) A pharmacist, physician or some other party can then provide
intervention for the patients that are likely to have trouble with compliance. (Id. at
col. 15:48-16:21.) Intervention by a pharmacist or someone else has been shown to
improve patient compliance with their prescription, which improves health
outcomes and consequently lowers health costs. (Id. at col. 2:6-8.)
14
The intervention may come in several forms, including providing

educational materials that warn of the consequences of not taking a medication or
remind a patient to get a refill of the medication. (Id. at col. 5:22-38, 8:56-62, 9:6065.) The educational materials, like other forms of intervention, may be provided at
various times, including before a prescription is filled. (Id. at col. 9:65-67, 15:4853, Fig. 5.) In other words, if it is determined that intervention is required,
Camarda teaches that education materials may be provided to a patient before they
are given prescription drugs.
The DAC Transcript The computerized system disclosed in Lilly has a
particular application for drugs such Xyrem, a drug covered by the 059 Patent.
The active ingredient in Xyremsodium oxybate, the sodium salt of gamma
hydroxybuyrate (GHB)was well-known in the prior art as being susceptible to
diversion and abuse. (Ex. 1003 at pp. 9:18-10:3; see also Ex. 1006 at 49-51, 6374.) Given the potential for diversion or abuse of GHB, the FDA held advisory
committee meetings to discuss granting approval to the Xyrem New Drug
Application (NDA). (Id. at pp. 5:23-6:3.)
Orphan Medical, Inc. (the sponsor of Xyrem and predecessor in interest to
Patent Owner) appeared before the FDAs Advisory Committee on June 6, 2001,
to address methods for preventing abuse of Xyrem. (Id. at p. 9:12-17.) As a result
of that Advisory Committee meeting, Orphan Medical, Inc. proposed to employ a
15
centralized distribution program to attempt to reduce abusive and illicit uses of

Xyrem. (Id. at p. 176:3-13.) That program is known as the Xyrem Success
Program. (Id.) The DAC Transcript discloses that the Xyrem Success Program is
designed to inform patients and physicians about the risks of GHB and minimize
the risk to patients or others that may get access to it. (Id. at p. 15:1-6.)
The risk management method disclosed in the DAC Transcript was
implemented as a closed distribution system. (Id. at p. 400.) That system makes
the product available through a central pharmacy that approves the prescription and
ships the drug product to the patient, as shown in the slide below:
(Id.) As part of the Xyrem Success Program, physicians and patients receive
detailed educational materials about the risks and the appropriate use of Xyrem.
The DAC Transcript discloses a patient could be required to sign an informed
consent form or a registry form indicating that the patient received and/or read
these educational materials prior to receiving the first shipment of the drug. (Id. at
16
pp. 371:8-372:15, 374:7-375:23, 376:4-18.) As shown in the DAC Transcript slide

below, the requirement that patients receive and/or read educational materials
allows an opportunity for intervention by a physician or pharmacist if a potential
for abuse is detected. (Id. at pp. 18:15-18, 184:24-185:7, slide on p. 539.)
The DAC Transcript specifically discloses that the drug product is

manufactured in one place, sent to a single national specialty pharmacy, and
eventually shipped to the patient. (Id. at pp. 15:14-16:5.) The benefits of this
program are that not only is the product distributed from a central location, but all
of the controls and all of the records are in one place. (Id. at p. 178:1-11.)
The CSR An additional aspect of the FDAs approval process for Xyrem
was a Preliminary Clinical Safety Review (CSR) of Orphan Medicals NDA.
The review was completed on May 3, 2001, and the CSR reference shows the
outcome of the review. The CSR is related to the DAC Transcript as it concerns
the same drug by the same company. A POSA would have understood to look to
17
the teaching of both the DAC Transcript and the CSR to address the issues
regarding misuse and abuse of Xyrem. (Ex. 1006 at 79-81.)
The CSR reference discloses a Risk Management Program for Xyrem.
(Ex. 1005 at p. 108.) As part of the Risk Management Program, a patients
prescription of Xyrem may be shipped to another pharmacy for patient pick-up,
rather than shipping it directly to the patient. (Id. at p. 110.) The central pharmacy
verifies that the second pharmacy has controls in place on the distribution of the
prescription drug to protect against diversion of Xyrem before shipping the drug
there. (Id.) The CSR discloses that the second pharmacy will employ the same
safety checks as the first pharmacy, such as providing educational material to the
patient, handling insurance information, flagging lost, stolen, destroyed, or spilled
prescriptions, etc. (Id.)
As discussed below in Section VII.B-C, the combined teachings of Lilly,
Camarda, the DAC Transcript and the CSR would have instructed a POSA how to
implement the methods of drug distribution claimed in the 059 Patent to minimize
the risks associated with hazardous prescription drugs. (Ex. 1006 at 52-55.)
VI.
Claim Construction
The terms of claims 1-16 are to be given their broadest reasonable
interpretation, as understood by one of ordinary skill in the art. See 37 C.F.R.

42.100 (b). The terms recited in claims 1-16 generally do not require construction
18
and can be interpreted according to their plain and ordinary meaning. The
exceptions are the terms exclusive central pharmacy and exclusive computer
database, which appear as limitations in each of claims 1-16.
Consistent with the broadest reasonable interpretation, the term exclusive
should be construed to mean single or sole. The terms exclusive central
pharmacy and exclusive computer database thus should be construed,
consistent with their plain meaning in the context of the 059 Patent, to mean a
single or sole controlling pharmacy and a single or sole computer database,
respectively. (Ex. 1006 at 82-88.)
The 059 Patent discloses that a central pharmacy and database is used to
control the tracking of all prescriptions for a sensitive drug. (Ex. 1001 at Abstract
and 1:44-46.) The Summary of the Invention, states that the exclusive central
database contains all relevant data related to distribution of the drug and process of
distributing it ... (Id. at col. 2:16-18 (emphasis added).) An embodiment of the
invention is described where Xyrem is distributed and dispensed through a
primary and exclusive central pharmacy, and is not stocked in retail pharmacy
outlets. (Id. at col. 3:46-48 (emphasis added).) In this embodiment, bulk sodium
oxybate is manufactured at a single site, as is the finished drug product. (Id. at col.
3:40-41.) Following manufacture of the drug product, it is stored at a facility
compliant with FDA Schedule III regulations, where it is dispensed only through a
19
single pharmacy. (Id. at col. 3:44-46.) This would have demonstrated to a POSA
that there is a single or sole pharmacy controlling all aspects of the drug and its
distribution, including a single database containing all the relevant information
concerning prescriptions for the drug and filling such prescriptions. (Ex. 1006 at
85.)
The prosecution history of U.S. Patent No. 7,668,730 also supports these
constructions. (Id. at 86.) The 059 Patent is a continuation of the 730 Patent. As
a result, statements made during the prosecution of the 730 Patent are relevant to
the construction of the claim terms in the 059 Patent. During the prosecution of
the 730 Patent, the applicants explicitly defined the term exclusive as single or
sole. (Ex. 1008 at p. 2.)
Further, the dictionary defines exclusive as limiting or limited to
possession, control, or use (as by a single individual or organization or by a special
group or class) . . . single, sole. Websters Third New Internl Dictionary, 793
(3rd ed. 2002) (Ex. 1009.)
VII. CLAIMS 1-16 ARE INVALID AS OBVIOUS OVER
COMBINATIONS OF LILLY, THE DAC TRANSCRIPT, CAMARDA
AND THE CSR
The challenged claims of the 059 Patent are invalid as obvious based on the
proposed grounds set forth below:
20
Ground
1
Claim Nos.
1-6, 9 and 1214
7-8, 10-11 and

15-16
Proposed Statutory Rejections

Claims 1-6, 9 and 12-14 are obvious under 35
U.S.C 103(a) over Lilly in view of the DAC
Transcript and Camarda
Claims 7-8, 10-11 and 15-16 are obvious under 35
U.S.C 103(a) over Lilly in view of the DAC
Transcript, Camarda and the CSR
For each asserted ground, Petitioner demonstrates below where each

limitation either exists in the prior art or is rendered obvious by evaluating the
scope and contents of the prior art, any differences between the art and the
challenged claims, the knowledge of person of ordinary skill in the art, and any
available objective indicia of nonobviousness in accordance with Graham v. John
Deere Co., 383 U.S. 1 (1966) and KSR Intl Co. v. Teleflex, Inc., 550 U.S. 398
(2007). This Petition, supported by the Fudin Declaration, demonstrates that the
Board should institute inter partes review and cancel claims 1-16 of the 059
Patent as unpatentable under 35 U.S.C. 103.
A.
Each Of The References Cited Is Available Prior Art.

1.
Lilly and Camarda are 102(e) prior art.
Lilly qualifies as prior art under 35 U.S.C. 102(e). Lilly is a published

continuation of application No. 10/062,251 (the 251 Application), which was
filed on January 31, 2002. (Ex. 1002.) The 251 Application claims priority to
Provisional Patent Application No. 60/332,807, which was filed on November 14,
2001. (Id.) Thus, Lilly is entitled to a 102(e) prior art date of November 14, 2001,
21
the filing date of its earliest provisional application. See In re Giacomini, 612 F.3d
1380 (Fed. Cir. 2010).
By contrast, the earliest effective filing date of the 059 Patent (which has
different inventors than Lilly) is December 17, 2002. This is considered the date of
invention for the claimed subject matter of the 059 Patent under 102(e). Lilly
thus qualifies as an application for patent, published under section 122(b), by
another filed in the United States before the invention by the applicant for [the
059] patent, and is considered 102(e) prior art to the 059 Patent.
Camarda likewise qualifies as prior art under 35 U.S.C. 102(e). The
application for Camarda was filed on July 30, 1998, and it claims priority to
Provisional Patent Application Nos. 60/054,384 (filed on July 31, 1997) and
60/082, 172 (filed on April 16, 1998). (Ex. 1004.) Thus, Camarda is entitled to a
102(e) prior art date of July 31, 1997, the filing date of its earliest provisional
application. See Giacomini, 612 F.3d 1380. Camarda issued as a patent on July 1,
2003, and names different inventors than the 059 Patent. Given that the 059
Patent has a date of invention 102(e) of December 17, 2002, Camarda qualifies
as a patent granted on an application for patent by another filed in the United
States before the invention by the applicant for patent. 35 U.S.C. 102(e) (2).
22
2.
The DAC Transcript and the CSR are printed

publications that qualify as 102(b) prior art.
The DAC Transcript and the CSR qualify as prior art printed publications
under 35 U.S.C. 102(b). When considering whether a given reference qualifies
as a prior art printed publication, the key inquiry is whether the reference was
made sufficiently accessible to the public interested in the art before the critical
date. Voter Verified, Inc. v. Premier Election Solutions, Inc., 698 F.3d 1374, 1380
(Fed. Cir. 2012). [T]he ultimate question is whether the reference was available
to the extent that persons interested and ordinarily skilled in the subject matter or
art[,] exercising reasonable diligence, can locate it. Voter Verified, 698 F.3d at
1380 (quoting SRI Intl, Inc. v. Internet Sec. Sys., Inc., 511 F.3d 1186, 1194 (Fed.
Cir. 2008); see also EMC Corp. v. Personal Web Techs., LLC, IPR2013-00084,
Paper 14, at 20-21 (P.T.A.B. May 17, 2013) (An electronic publication can
qualify as publicly accessible printed publication if sufficient evidence is
provided demonstrating that the publication was disseminated publicly or
otherwise made available to a POSA exercising reasonable diligence.)
[T]he determination of whether a given reference qualifies as a prior art
printed publication involves a case-by-case inquiry into the facts and
circumstances surrounding the references disclosure to members of the public.
EMC, IPR2013-00084, Paper 14, at 19 (citing In re Klopfenstein, 380 F.3d 1345,
1350 (Fed. Cir. 2004)). In Klopfenstein, the court described a four-factor balancing
23
test to determine if a reference is a printed publication: (1) the length of time the
display was exhibited; (2) the expertise of the target audience; (3) the existence (or
lack thereof) of reasonable expectations that the material displayed would not be
copied; and (4) the simplicity or ease with which the material displayed could have
been copied. 380 F.3d at 1350.
There is ample evidence that the DAC Transcript qualifies as a publicly
available prior art printed publication. According to the Federal Register notice
announcing the FDAs Advisory Committee meeting on Xyrem, the transcript of
the meeting was posted on the internet approximately three weeks after the June 6,
2001 meeting:
Background material from the sponsor and FDA will be posted 24
hours before the meeting at the Peripheral and Central Nervous
System Drugs Advisory Committee docket site at http://www.fda.gov/
ohrms /dockets/ac/acmenu.htm (Click on the year 2001 and scroll
down to the Peripheral and Central Nervous Systems Drugs
meetings.) This is the same website where you can find the minutes,
transcript, and slides from the meeting. This material is generally
posted about 3 weeks after the meeting.
(Ex.1015) (emphasis added). Based on the stated timeline, the DAC Transcript
thus was publicly accessible to a POSA exercising reasonable diligence as of June
27, 2001. Such competent evidence of the [FDAs] general [] practice may be
relied upon to establish an approximate time the DAC Transcript became publicly
24
accessible. See The Federal Advisory Committee Act, 5 U.S.C. App 2 10(b)
(2001). The FDA website further states the DAC Transcript was available no later
than July 13, 2001. (Ex. 1016.) This is confirmed by the Internet Archive:
Wayback Machine (https://archive.org/web/web.php), which indicates that the
DAC Transcript was publicly accessible on the Internet in July 2001.1 (Ex. 1017.)
The DAC Transcript qualifies as a printed publication under the
Klopfenstein test. The DAC Transcript was posted online on the FDAs website,
the FDA website was well known to those interested in the art (pharmacists with
an understanding of the FDAs drug approval process), a POSA exercising
reasonable diligence would have found the DAC Transcript on the website, and the
document could have been printed (or copied) from the website without restriction.
The DAC Transcript thus is similar to the Kantor reference in EMC, which was
found to be prior art because the reference was posted on a publicly accessible
site well known to those interested in the art the electronic Bulletin Board
Systems and could be downloaded and retrieved from that site. IPR2013-00084,
Paper 14, at pp. 20-21 (citing In re Wyer, 655 F.2d 221, 226 (CCPA 1981)
(holding that an electronic publication, including an on-line database or Internet
The Board previously has considered information from the Wayback Machine as
part of the determination of whether to institute inter partes review. See Veeam
Software Corp. v. Symantec Corp., IPR2013-00142, Paper 11, at pp. 9-10.
(P.T.A.B. Aug. 7, 2013
25
publication, is considered to be a printed publication upon a satisfactory showing

of public accessibility to persons of ordinary skill in the art even without evidence
concerning actual viewing or dissemination of the reference.) The DAC Transcript
thus qualifies as 102(b) prior art.
Likewise, the CSR qualifies as a publicly accessible prior art printed
publication. Orphan Medical submitted the CSR, along with other supporting
documents, as background materials to the FDA before the Advisory Committee
met on June 6, 2001. (Ex.1005.) As the quote above explains, [b]ackground
material from the sponsor and FDA [was] posted 24 hours before the meeting at
the Peripheral and Central Nervous System Drugs Advisory Committee docket site
at http://www.fda.gov/ohrms/dockets/ac/ acmenu.htm. (Ex. 1015.) Thus, the CSR
was publicly accessible on the Internet no later than June 5, 2001. Moreover, the
CSR contains redactions of the name of the proposed specialty pharmacy for
distribution of Xyrem. This is further evidence that the unredacted portion of the
CSR was available to the public. Additional evidence of public accessibility of the
CSR comes from the Internet Archive: Wayback Machine (https://archive.org/web/
web.php), which shows the CSR was publicly available as of July 1, 2001. (Ex.
1017.)
As with the DAC Transcript, the CSR was posted online on the FDAs
website, the FDA website was well known to those interested in the art, a POSA
26
exercising reasonable diligence would have found the CSR on the website, and the
document could have been be printed (or copied) from the website without
restriction. The CSR thus qualifies as 102(b) prior art.
B.
Ground 1: Claims 1-6, 9 and 12-14 are obvious over Lilly in view
of the DAC Transcript and Camarda.
Claims 1-6, 9 and 12-14 were obvious over Lilly in view of the DAC
Transcript and Camarda. (Ex. 1006 at 102-204.) A POSA at the time of the
alleged invention of the 059 Patent would have been motivated to combine the
teachings of Lilly, the DAC Transcript and Camarda to arrive at a method for
reducing the abuse of drug products such Xyrem and thus improve the healthcare
system while reducing healthcare costs. (Id. at 102-114.) It was well-known to a
POSA that it was desirable to reduce spiraling costs structures, mitigate health
risks, provide more efficient billing, eliminate redundancy, and improve
informational flow. (Ex. 1002, 0009 (emphasis added).) It would be desirable
to provide a healthcare utility that can assist substantially in reducing these
misused and abused prescriptions. (Id. at 0012 (emphasis added); see id. at
0003-0005, 0035.)
In Lilly, the disclosed [p]harmaceutical information control organization []
provides the pharmaceutical industry with a vehicle to help them track and access
appropriate information about prescriptive drugs by maintaining prescription
information in a central database. (Id. at 0055.) This allows pharmacies to check
27
to personally verify the drug usage of each purchaser to immediately detect

problems related to abuse, fraud, and misuse of medications. (Id. at 0057; see
also id. at 0051-0054, 0056.)
Similarly, the Xyrem Success Program disclosed in the DAC Transcript is
a comprehensive program which is designed to responsibly distribute this
important medication in order that patients who need it have it available, and it is
inaccessible for those who might abuse it. (Ex. 1003, p. 185:9-14;) (emphasis
added). The DAC Transcript teaches a closed loop distribution system having a
central repository [or database] of prescription information that identifies potential
patterns of abuse such as duplicate prescriptions, over-prescribing or patient overuse. (Id. at pp. 177:24-178:11, 184:24-185:4.) This helps prevent abuse by
providing the information necessary for pharmacist intervention before filling a
Xyrem prescription. (Id. at p. 185:4-7.)
Camarda likewise discloses a computerized system to improve patient health
care by disclosing a system for improving patient compliance with prescriptions.
(Ex. 1004 at col. 2:55-67; Fig. 2.) The system allows pharmacists and physicians to
monitor patients most likely to have poor compliance and provide intervention
(including educational materials) to improve that compliance. (Id. at col. 5:34-37
and 9:60-67.) This includes intervention for patients may be guilty of abuse of the
prescription. A POSA would look to modify Lilly with the teachings of the DAC
28
Transcript and Camarda to reduce abuse, improve efficiency and achieve the
results desired in Lilly. (Ex. 1006 at 102-114.) A POSA also would know those
teachings could be readily combined using known and predictable methods with no
unexpected results.
1.
The Combination of Lilly, the DAC Transcript and

Camarda Discloses All of the Elements of claims 1-6, 9 and
12-14 of the 059 Patent
a)
Claim 1
The combination of the Lilly and the DAC Transcript discloses the
computerized method of distributing a prescription drug under exclusive control
of an exclusive central pharmacy claimed in claim 1 of the 059 Patent. (Ex. 1001,
col. 8:37-39.) A POSA would understand that Lilly teaches a computerized method
of managing prescription drug information in a centralized database to minimize
abuse of drug products, and the DAC Transcript teaches distributing prescription
drug products using an exclusive central pharmacy, again to minimize the
possibility of abuse. (Ex. 1006 at 109.)
Lilly discloses a computerized method utilizing a pharmaceutical
information control organization to gather prescription drug information so it can
be used to detect problems related to abuse, fraud, and misuse of medications.
(Ex.1002, Abstract, 0037, 0051, 0057.) The information maintained by
pharmaceutical information control organization may be selectively retrieved
29
through a secure computer connection by entities such as hospitals, doctors,

pharmacies, insurance companies, government agencies and the like (Id. at
Abstract, 0038-0039.) Lilly teaches the pharmaceutical information control
organization can be implemented as an independent information utility that acts as
the central service center for the management of prescriptive medication drugs.
(Id. at 0051.) This central service center can use a composite data storage or
centralized database. (Id. at 0061.)
Further, the DAC Transcript describes a closed loop pharmaceutical
distribution system which consists of a couple of major components. One is that
the product will be made available through a central pharmacy and will be shipped
directly to the patient at home. (Ex. 1003, Tr. at 15:14-19; see also Ex. 1006 at
113.) This closed loop systems likewise identifies potential patterns of abuse
such as duplicate prescriptions, over-prescribing or patient over-use. (Id. at pp.
184:24-185:4; see also id. at pp. 177:24-178:11.)
(1)
The receiving in a computer processor all

prescription requests . . . element is met.
The combination of Lilly and the DAC Transcript discloses the receiving in
a computer processor all prescription requests element of claim 1. (Ex. 1006 at
115-127.) Lilly teaches a computer processor that receives prescription requests
when it describes sending data either to or from the computer system of
pharmaceutical information control organization, and chang[ing] the format of the
30
data as needed between that used by the computer software of pharmaceutical

information control organization (central organization) and the user software.
(Ex. 1002 at 0067(emphasis added).)
The DAC Transcript similarly teaches a computer receiving all
prescription requests for all patients: Once the physician decides to prescribe
Xyrem the physician faxes this special prescription to the specialty pharmacy.
(Ex. 1003 at p. 180:14-16; see also p. 391.) The prescriptions are received from
doctors allowed to prescribe the drug. (Id. at p. 181:1-14.) All prescription requests
are maintained at the exclusive central pharmacy: [D]istribution of Xyrem
would best be accomplished in a closed distribution systemthe benefits of this
the controls and all the records are in one place. (Ex. 1003 at pp. 177:24-178:11)
(emphasis added). The DAC transcript also teaches that the requests come from
any and all medical doctors allowed to prescribe the drug as claimed: All
patients and physicians will be entered into a registry. (Id. at p. 16:4-5)(emphasis
added).
Further, both Lilly and the DAC Transcript teach that the prescription
requests include information identifying the patient, prescription drug and medical
doctor credentials, as recited in this element. Lilly discloses that [v]arious types of
data may be stored and/or obtained such as the doctor name, the doctor DEA
31
number, patient name, patient ID (e.g. SS#, passport #, driver's license, etc.),
patient address, city, state, zip, patient phone number, drugs prescribed, dosage,
frequency, start/end date, duration, quantity, number refills, whether substitution is
allowed, generic allowed, notes, aberrant use flag, date prescription filed, place
prescription filled, pharmacist name, pharmacist phone number, pharmacist DEA
number, and application programming interfaces utilized (Ex. 1002 at 0068.)
The DAC Transcript discloses that the doctors provide prescription requests
using kits that contain a number of unique prescribing forms for Xyrem which
will be necessary in order for the prescription to be filled. (Ex. 1003 at p. 180:624.) The DAC Transcript further discloses that the credentials of the doctor are
provided with the prescription, and the DEAs National Technical Information
Services database is used to ensure that each physician has an active valid medical
license, and to ensure the physician has current prescribing privileges to prescribe
Schedule III medications (such as Xyrem). (Id. at p. 181:4-14.) The references
teach all limitations of this element.
(2)
The requiring entering of the information into an

exclusive computer database . . . element is met.
The combination of the Lilly and the DAC Transcript discloses each of the
limitations of the requiring entering of the information into an exclusive computer
database element of claim 1. (Ex. 1006 at 115, 128-136.) Specifically, a POSA
would look at the teachings of Lilly and the DAC Transcript and be directed to a
32
distribution system that requires entering of the information into an exclusive

computer database associated with the exclusive central pharmacy for analysis of
potential abuse situations, such that all prescriptions for the prescription drug are
processed only by the exclusive central pharmacy using only the exclusive
computer database.
For example, Lilly teaches the pharmaceutical information control
organization can be implemented as an independent information utility that acts as
the central service center for the management of prescriptive medication drugs.
(Id. at 0051.) This central service center can use a composite data storage or
centralized database. (Id. at 0061.) Various types of information about a patient
or prescribing physician are stored in the pharmaceutical information control
organization. (Id. at 0068.) The stored information can be analyzed to evaluate
potential abuse situations for a drug. (Ex.1002, Abstract, 0037, 0051, 0057.)
The DAC Transcript discloses that the Xyrem distribution system will be
set up such that the product is manufactured in a single manufacturing facility, the
product is sent to a single national specialty pharmacy, and all controls and records
are maintained in one place. (Ex. 1003 at p. 177:24-178:1.) Once the physician
decides to prescribe Xyrem the physician faxes this special prescription to the
specialty pharmacy. (Id. at p. 180:14-16). The relevant information about the
patient and physician associated with the prescription request is entered into a
33
central registry (or database). (Id. at p. 15:14-16:5.) If the patient and physician are
cleared, the Xyrem is made available through [the] central pharmacy and will be
shipped directly to the patient at home. (Id. at p. 15:17-19.) The benefits of this
the controls and all the records are in one place. (Id. at pp. 177:24-178:11
(emphasis added).)
(3)
The checking with the computer processor the

credentials of the any and all doctors element is
met.
The DAC Transcript discloses the element checking with the computer
processor the credentials of the any and all doctors to determine the eligibility of
the doctors to prescribe the prescription drug of claim 1. (Ex. 1006 at 115, 137140.) For example, the DAC Transcript discloses a system that when the
prescription comes to the specialty pharmacy there will be a number of checks to
determine if the physician is, in fact, eligible to prescribe Xyrem. (Ex. 1003 at p.
181:1-4)(emphasis added.) We will be utilizing the DEAs NTIS or National
Technical Information Services database to ensure that each physician has an
active valid medical license, and also to ensure that the physician has current
prescribing privileges which allow him or her to prescribe Schedule III
medications in this country. (Id. at p. 181:4-10.) As a backup check, the specialty
pharmacy will also be checking with the appropriate state medical board to
34
determine that there are no pending actions on the behalf of the state for that given
physician. (Id. at p. 181:10-14.)
Further, Lilly discloses storing data including the name of a patients doctor
in addition to other data about the prescription. (Ex. 1002, Abstract, 0041,
0068.) Lilly further discloses searching the stored pharmaceutical computer data
based on the doctor name. (Id. at 0042.) A POSA would understand that the
doctors name would be stored and searched to check the credentials of the doctor
to determine eligibility to prescribe the drug product. (Ex. 1006 at 139-140.)
(4)
The confirming with a patient that educational

material has been received and/or read prior to
shipping the prescription drug element is met.
The DAC Transcript and Camarda disclose the element confirming with a
patient that educational material has been received and/or read prior to shipping the
prescription drug of claim 1. (Ex. 1006 at 115, 141-147.) As part of the
Xyrem Success Program, a patient receives detailed written educational materials
about the risks and the appropriate use of Xyrem, as well as a phone call
explaining, among other things, the risks of a drug such as Xyrem. (Ex. 1006 at
68-70; see also Ex. 1003 at pp. 182:3-12, 184:24-185:7.) A patient may be required
to sign an informed consent form or a registry form indicating that the patient
received and/or read these educational materials prior to receiving the first
shipment of the drug. (Ex. 1003 at pp. 371:8-372:15, 374:7-375:23, 376:4-18.)
35
Alternatively, the educational materials can be sent with the first shipment of the
drug product, and the patient may be required to review them prior to getting
additional shipments. (Id. at p. 182:6-12.) The requirement that patients receive
and/or read educational material allows an opportunity for intervention by a
physician or pharmacist if a potential for abuse is detected. (Id. at pp. 15:20-16:3,
18:15-18, 184:24-185:7.)
Camarda teaches that educational materials are provided to patients who are
having trouble with their compliance with prescriptions. (Ex. 1004 at col. 2:55-62,
5:34-37, Figures 1 and 3.) A pharmacist or physician may intervene with a patient
who is believed to have poor compliance with a prescription by providing
educational materials to the patient before providing a refill of a prescription. (Id.
at col. 9:60-67.) In the embodiments of Camarda, there is a disclosure of a method
to confirm the patient receives the educational materials before getting the
prescription drug. For example, a pharmacist may give the educational materials to
the patient before the patient leaves the pharmacy. (Id. at col. 15:64-16:3.) A
physician also may provide intervention (which includes educational materials)
before a patient leaves the physicians office to go fill a prescription. (Id. at col.
16:9-21.) It would be obvious to a POSA that Camarda teaches the claimed way to
confirm that educational materials have been received and/or read by a patient
prior to shipping a prescription drug to the patient.
36
(5)
The art teaches checking the exclusive computer

database for potential abuse of the prescription
drug.
Lilly and the DAC Transcript both disclose the element checking the
exclusive computer database for potential abuse of the prescription drug. (Ex.
1006 at 115, 148-151.) Lilly teaches that [p]harmacies 26 may check to
personally verify the drug usage of each purchaser to immediately detect problems
related to abuse, fraud, and misuse of medications. (Ex. 1002 at 0057; see also
id. at 0051, 0053-0054.)
The DAC Transcript teaches that [t]he central data repository designed for
Xyrem really allows for identification of a number of unusual types of behavior,
including any duplicate prescriptions, any attempts of over-prescribing, or any
attempts to over-use by patients. The benefit here is that [] information is available
prior to filling the prescription so appropriate pharmacist intervention can occur.
(Ex. 1003, Tr. at 184:24-185:7.) Thus this limitation is met.
(6)
The mailing or sending by courier the

prescription drug to the patient element is met.
The DAC Transcript discloses each of the limitations of the element

mailing or sending by courier the prescription drug to the patient only if no
potential abuse is found by the patient to whom the prescription drug is prescribed
and the doctor prescribing the prescription drug of claim 1. (Ex. 1006 at 115,
152-156.) The DAC Transcript describes a risk management program with a
37
major component being that the product will be made available through a
central pharmacy and will be shipped directly to the patient at home. (Ex. 1003 at
p. 15:14-19) (emphasis added). [Xyrem] is sent to one single national specialty
pharmacy. Eventually, it goes by courier to patients with narcolepsy. (Id. at p.
178:4-6). A shipment is sent by a special system that has a special, unique
tracking system called a Rapid Trac System. [T]his system will allow detailed realtime tracking of that package which is delivered only by the authorized signature.
(Id. at p. 182:17-22). The drugs are sent only after the system checks for abuseindicative activity and clearance is provided. (Id. at 181:1-22.) The system has a
number of checks to determine if the physician is, in fact, eligible to prescribe
Xyrem. (Id. at 181:1-14.) The specialty pharmacy also checks for indications of
abuse by the patients, including a call to the physicians office to make sure the
patient is real and a prescription has been written for the patient. (Id. at p. 181:1622.) A POSA would understand that checking for abuse would obviously occur
before the drug is sent to the patient, as this sequence of events is how the check
would prevent abuse by the patient. Thus, the art teaches and suggests mailing or
sending by courier the prescription drug only if no potential abuse is found by the
patient to whom the prescription drug is prescribed and the doctor prescribing the
prescription drug. (Ex. 1006 at 156.)
38
(7)
The art teaches confirming receipt by the patient

of the prescription drug.
The DAC Transcript discloses the element confirming receipt by the patient
of the prescription drug from claim 1. (Ex. 1006 at 115, 157-159.) The DAC
Transcript teaches that the system will confirm receipt of the prescription drug by
the patient: After the Rapid Trac System shows that the package had been
received by the patient, the specialty pharmacist will call the patient within 24
hours not only to confirm receipt of that package . . . . (Ex. 1003 at p. 184:10-15)
(emphasis added).
(8)
The generating with the computer processor

periodic reports element is met.
The combination of the Lilly and the DAC Transcript discloses the
requiring entering of the information into an exclusive computer database
element of claim 1. (Ex. 1006 at 115, 160-165.) A purpose taught by Lilly is
that the system detects and evaluates problems related to abuse, fraud, and misuse
of medications. (Ex. 1002 at 0057.) A POSA would understand that these
problems are the potential diversion patterns referenced in claim 1 of the 059
Patent. (Ex. 1006 at 161-162.) One way Lilly addresses these problems is by
generating reports through the use of the data in the database associated with
Lillys pharmaceutical information control organization. Such
reporting/informational access can include up-to-date patient prescriptive
39
medication information to their primary care physician or pharmacy, comparisons

for potential drug interactions, and/or emergency information access.
(Ex. 1002 at 0072) (emphasis added).
Camarda teaches the generation of reports by a computer processor to
monitor for lack of patient compliance with prescriptions. (Ex. 1004 at col. 17:3548.) The reports can, for example, compare the behavior of patients who
participated in the intervention program with those of a control group of nonparticipating patients. (Id. at col. 17:40-42.) In this way, a POSA would use the
report to track lack of patient compliance. A POSA would understand that these
reports generated in Lilly and Camarda can be used to evaluate potential diversion
(i.e. abuse) patterns for prescriptive medications. (Ex. 1006 at 161-165.)
The following claim chart demonstrates how each limitation of claim 1 was
known in the prior art:
Claim
1. A computerized
method of
distributing a
prescription drug
under exclusive
control of an
exclusive central
pharmacy, the
method comprising
Proposed Grounds of Challenge

Lilly discloses a computerized system to assist
pharmacies to distribute prescription drugs to patients.
The information [patients prescription drug use] may be
selectively retrieved through a secure computer
connection by entities such as hospitals, doctors,
pharmacies, insurance companies, government agencies
and the like. (Ex. 1002 at Abstract.)
Lilly teaches a computer processor when it describes that,
the various programs discussed above and/or others may
be used to select specific types of data for transfer as
indicated at information access filter, and to send data
either to or from the computer system of pharmaceutical
40
Claim

information control organization, and change the format
of the data as needed between that used by the computer
software of pharmaceutical information control
organization (central organization) and the user software
(Ex. 1002 at 0067 (emphasis added); see also id. at
Figure 1.)
Lilly teaches that Pharmaceutical information control
organization 21 may be implemented as an independent
information utility that acts as the central service center
for the management of prescriptive medication drugs.
(Id. at 0051; see also id. at 0039.)
The DAC Transcript describes the risk management
program which consists of a couple of major
components. One is that the product will be made
available through a central pharmacy and will be shipped
directly to the patient at home. (Ex. 1003 at p. 15:14-19.)
The DAC Transcripts states, [Xyrem] is sent to one
single national specialty pharmacy. (Ex. 1003 at p.
178:4-5.)
receiving in a
computer processor
all prescription
requests, for any and
all patients being
prescribed the
prescription drug,
only at the exclusive
central pharmacy
from any and all
medical doctors
allowed to prescribe
the prescription drug,
the prescription
requests containing
information
identifying patients,

Figure 1.)
41
Claim
the prescription drug,
and various
credentials of the any
and all medical
doctors;

(Id. at 0051.)
Further, Lilly teaches, various types of data may be
stored and/or obtained such as the doctor name, the
doctor DEA number, patient name, patient ID (e.g. SS#,
passport #, driver's license, etc.), patient address, city,
state, zip, patient phone number, drugs prescribed,
dosage, frequency, start/end date, duration, quantity,
number refills, whether substitution is allowed, generic
allowed, notes, aberrant use flag, date prescription filed,
place prescription filled, pharmacist name, pharmacist
phone number, pharmacist DEA number, and application
programming interfaces utilized (Id. at 0068 (emphasis
added).)
The DAC Transcript states, Once the physician decides
to prescribe Xyrem the physician faxes this special
prescription to the specialty pharmacy. (Id. at p. 180:1416; see also id. at p. 391.)
The DAC Transcript describes distribution of Xyrem
would best be accomplished in a closed distribution
systemthe benefits of this program are that not only is
the product distributed from a central location, but all the
controls and all the records are in one place. (Id. at pp.
177:24-178:11 (emphasis added).) All patients and
physicians will be entered into a registry. (Id. at p. 16:45 (emphasis added).)
The DAC Transcript further states that as the
prescription comes to the specialty pharmacy there will
be a number of checks to determine if the physician is, in
fact, eligible to prescribe Xyrem, including review of the
DEAs NTIS or National Technical Information Services
42
Claim

database to ensure that each physician has an active valid
medical license, and to ensure the physician has current
prescribing privileges to prescribe Schedule III
medications. (Id. at p. 181:1-14; see also id. at p. 180:624.)
requiring entering of
the information into
an exclusive
computer database
associated with the
exclusive central
pharmacy for analysis
of potential abuse
situations, such that
all prescriptions for
the prescription drug
are processed only by
the exclusive central
pharmacy using only
the exclusive
computer database;

Figure 1, 0037 and 0051.)
(Id. at 0051.) This central service center can use a
composite data storage 122 that is external with respect
to the databases of the above entities but includes the
relevant pharmaceutical data within each of the above
entitys database(s). (Id. at 0061.)
Lilly also discloses that one of the plurality of entities
comprises a pharmacy with a pharmacist, such that when
the selected prescriptive medication purchaser request
that the pharmacist fill a new prescriptive medication then
the pharmacist utilizes the pharmaceutical computer data
to compare the new prescriptive medication with respect
to the medication history of the selected prescriptive
medication purchaser. The method may further comprise
the pharmacist accepting or declining to fill the new
prescriptive medication based on the medical history.
(Id. at 0039.)
43
Claim

The DAC Transcript states, Once the physician decides
to prescribe Xyrem the physician faxes this special
prescription to the specialty pharmacy. (Ex. 10003 at p.
180:14-16.)
checking with the

computer processor
the credentials of the
any and all doctors to
determine the
eligibility of the
doctors to prescribe
the prescription drug;
Lilly teaches various types of data may be stored and/or

obtained such as the doctor name, the doctor DEA
number, patient name, patient ID (e.g. SS#, passport #,
driver's license, etc.), patient address, city, state, zip,
patient phone number, drugs prescribed, dosage,
frequency, start/end date, duration, quantity, number
refills, whether substitution is allowed, generic allowed,
notes, aberrant use flag, date prescription filed, place
prescription filled, pharmacist name, pharmacist phone
number, pharmacist DEA number, and application
programming interfaces utilized (Id. at 0068 (emphasis
added).)
The DAC Transcript further states that as the
prescription comes to the specialty pharmacy there will
be a number of checks to determine if the physician is, in
fact, eligible to prescribe Xyrem, including review of the
DEAs NTIS or National Technical Information Services
database to ensure that each physician has an active valid
medical license, and to ensure the physician has current
prescribing privileges to prescribe Schedule III
medications. (Id. at p. 181:1-14; see also id. at p. 180:624.)
confirming with a
patient that
educational material
has been received
and/or read prior to
shipping the
prescription drug;
The DAC Transcript teaches that each patient, when

they get their first prescription of Xyrem will receive
multi-faceted education program called the Xyrem patient
Success Program. (Ex. 1003 at p. 182:5-8.) Moreover,
the slides presented in the DAC Transcript disclose that
the patients are explained the contents of the shipment,
which includes the educational material, before shipment.
(Id. at p. 394.)
The DAC Transcript also teaches that [p]hysicians and
patients will also receive detailed materials about the
44
Claim

risks and the appropriate use of the drug after the first
prescription is filled. Actually they will receive those
materials initially and all subsequent refills of
prescriptions will be contingent upon patients and
physicians documenting that they have read these
materials, and they understand the risks and how to take
the drug appropriately at (Id. at pp. 15:20-16:3).
The DAC Transcript teaches, the benefit here is that []
information is available prior to filling the prescription so
appropriate pharmacist intervention can occur. (Id. at p.
185:4-7) [T]he plan calls for such a form to be
submitted after the first prescription is filled, that they
have read materials, they have received them and they
have read them. (Id. at pp. 374:14-17).
Camarda teaches that one aspect of the invention is
directed to predicting which patients are most likely to
fail to comply with their prescription, so that intervention
can be directed at these patients that are at high risk of
non-compliance at the time the prescription is given. The
intervention may be in the form of educational
information, reminders, etc. (Ex. 1004 at col. 2:55-62.)
Camarda further teaches [t]he intervention information
may be educational, e.g., warning of the consequences of
not strictly following the prescription, and/or a notice that
the medication needs to be taken or the prescription
refilled. (Id. at col. 5:34-37.)
Camarda further teaches [v]arious interventions are
proposed for the patient population in step 35. These may
take the form of various letters worded in various
different ways, e-mail or phone calls. They may
encourage the taking of the medication as a means to
achieve better health, warn of the dangers of not taking it,
or merely provide general educational information. The
intervention may occur at various times, e.g., before the
refill is due or after. (Id. at col. 9:60-67.)
45
Claim
checking the
exclusive computer
database for potential
abuse of the
prescription drug;

Lilly teaches that [p]harmacies 26 may check to
personally verify the drug usage of each purchaser to
immediately detect problems related to abuse, fraud, and
misuse of medications. (Ex. 1002 at 0057.)
Lilly further discloses, It would be desirable to provide a
healthcare utility that can assist substantially in reducing
these misused and abused prescription. (Ex. 1002 at
0012).
The DAC Transcript states, The central data repository
designed for Xyrem really allows for identification of a
number of unusual types of behavior, including any
duplicate prescriptions, any attempts of over-prescribing,
or any attempts to over-use by patients. The benefit here
is that [] information is available prior to filling the
prescription so appropriate pharmacist intervention can
occur. (Ex. 1003 at pp. 184:24-185:7.)
mailing or sending by
courier the
prescription drug to
the patient only if no
potential abuse is
found by the patient
to whom the
prescription drug is
prescribed and the
doctor prescribing the
prescription drug;
Lilly discloses, It would be desirable to provide a

healthcare utility that can assist substantially in reducing
these misused and abused prescription. (Ex. 1002 at
0012).
Lilly also discloses that the method may further
comprise the pharmacist accepting or declining to fill the
new prescriptive medication based on the medication
history. (Id. at 0039.)
Lilly further discloses that [p]harmacies 26 may check to
46
Claim

The DAC Transcripts states, [Xyrem] is sent to one
single national specialty pharmacy. Eventually, it goes by
courier to patients with narcolepsy. (Id. at p. 178:4-6;
see also id. at pp. 182:17-22.)
confirming receipt by After the Rapid Trac System shows that the package has
the patient of the
been received by the patient, the specialty pharmacist will
prescription drug; and call the patient within 24 hours not only to confirm
receipt of that package but also to again reiterate certain
important points with the patient. (Ex. 1003 at p. 184:1015 (emphasis added).)
generating with the
computer processor
periodic reports via
the exclusive
computer database to
evaluate potential
diversion patterns.
Lilly teaches that [p]harmacies 26 may check to

Lilly further teaches, Pharmaceutical information control
organization [ ] will provide appropriate levels of
reporting, as desired, to any selected oversight body or
committee, as well as other healthcare members as
appropriate and necessary. Such reporting/informational
access can include up-to-date patient prescriptive
medication information to their primary care physician or
pharmacy, comparisons for potential drug interactions,
and/or emergency information access. (Id. at 0072.)
Camarda teaches, The system can provide reports to the
pharmacy on the scores of each patient, together with
other information gathered from the patient data. This
information can be in the form of written reports,
generated on printer 28 or displays on display 27, or one
or more of the terminals 21. The reports can, for example,
compare the behavior of patients who participated in the
intervention program with those of a control group of
non-participating patients. Comparisons are made
between the two groups over a defined period of time
with regard to prescription units sold, prescription refill
pick-up percentage, days of medication purchased, and
47
Claim

persistence percentage over a defined period of time.
Thus, the reports can indicate the effectiveness of the
intervention program. (Ex. 1004 at col. 17:35-47.)
b)
Claim 2
Claims 2 depends from claim 1. Claim 2 recites that the exclusive central
pharmacy controls the exclusive computer database. (Ex. 1001, col. 9:4-5.) Lilly
similarly teaches a secure, private, independent, network-based, centralized
method operable for tracking and managing prescriptive medication information in
aggregate is provided which allows electronic querying and real-time notification
of patients' prescriptive medication history at the time of prescriptive medication
creation. . . . . [T]his information is accessible within a controlled and appropriate
context for use by healthcare professionals involved in the delivery of care to that
patient. (Ex. 1002 at 0050)(emphasis added). The DAC Transcript also teaches,
The benefits of this program are that not only is the product distributed from a
central location, but all the controls and all the records are in one place. (Ex. 1003
at p. 178:8-11) (emphasis added). It would have been obvious to a POSA to have
the central pharmacy control the database, otherwise the purpose of a central
pharmacycontrolling the collection and analysis of information that may indicate
abusewould be undermined. (Ex. 1006 at 167-171.) The following claim chart
demonstrates how each limitation of claim 2 was known in the prior art:
48
Claim
2. The method of
claim 1, wherein the
exclusive central
pharmacy controls
the exclusive
computer database.

Lilly discloses, [A] secure, private, independent, networkbased, centralized method operable for tracking and
managing prescriptive medication information in aggregate
is provided which allows electronic querying and real-time
notification of patients prescriptive medication history at
the time of prescriptive medication creation. According to
the method of the invention, this information is accessible
within a controlled and appropriate context for use by
healthcare professionals involved in the delivery of care to
that patient. (Ex. 1002 at 0050.)
The DAC Transcript discloses, The benefits of this
program are that not only is the product distributed from a
central location, but all the controls and all the records are in
one place. (Ex. 1003 at p. 178:8-11 (emphasis added).)
c)
Claim 3
Claims 3 depends from claim 1. Claim 3 recites selectively blocking

shipment of the prescription drug to a patient. (Ex. 1001, col. 9:6-7.) As in claim 3,
the DAC Transcript describes intervening in the shipment of a prescribed drug to
the patient. (Ex. 1003, Tr. at 184:24 185:7). A POSA would understand that the
intervention would include the blocking shipment to a patient, as that would be a
known and readily understood mechanism for intervening to reduce abuse by
patients. (Ex. 1006 at 172-176.) The following claim chart demonstrates how
each limitation of claim 3 was known in the prior art:
Claim
3. The method of

49
Claim
claim 1, comprising
selectively blocking
shipment of the
a patient.
d)

duplicate prescriptions, any attempts of over-prescribing, or
any attempts at over-use by patients. The benefit here is that
[ ] information is available to filling the prescription so
appropriate pharmacist intervention can occur. (Ex. 1003 at
pp. 184:24-185:7 (emphasis added).)
Claim 4
Claims 4 depends from claim 1. Claim 4 recites wherein an abuse pattern is

associated with a patient, and shipment is blocked upon such association. (Ex.
1001, col. 9:8-10). The DAC Transcript teaches that the central data repository
designed for Xyrem really allows for identification of a number of unusual types of
behavior, including any duplicate prescriptions, any attempts of over-prescribing,
or any attempts at over-use by patients. The benefit here is that [ ] information is
available to filling the prescription so appropriate pharmacist intervention can
occur. (Ex. 1003, Tr. at 184:24-185:7) (emphasis added). This is further supported
by the declaration of Dr. Fudin. (Ex. 1006 at 177-181.)
Claim
4. The method of
claim 1, wherein an
abuse pattern is
associated with a

Lilly teaches, The present invention removes many of the
management limitations that affect such efficiencies and will
help control costs of program delivery. All of these entities
can have immediate access to potential medication abuse by
50
Claim
patient, and
shipment is blocked
upon such
association.

identification of needless prescription duplications, potential
drug interactions, and multi-source interstate prescriptive
medication abuse. (Ex. 1002 at 0054; see also id. 0058.)
duplicate prescriptions, any attempts of over-prescribing, or
any attempts at over-use by patients. The benefit here is that
[ ] information is available to filling the prescription so
appropriate pharmacist intervention can occur. (Ex. 1003 at
pp. 184:24-185:7 (emphasis added).)
e)
Claim 5
Claim 5 depends from claim 1. Claim 5 recites, wherein the prescription

drug comprises gamma hydroxy butyrate (GHB). (Ex. 1001, col. 9:11-12.) The
inclusion of GHB in a prescription drug distribution system was known. (Ex. 1006
at 182-184.) The specific drug disclosed in the DAC Transcript was directed to
Xyrem. [T]oday we will ask you to discuss NDA 21-196for the use of Xyrem,
gamma hydroxybuturate or better known as GHB, for the treatment of cataplexy
and excessive daytime sleepiness in patients with narcolepsy. (Ex. 1003, Tr. at
9:12-17). Thus, claim 5 was disclosed in the prior art DAC Transcript reference.
Claim
5. The method of

The specific drug disclosed in the DAC Transcript was
51
Claim
claim 1, wherein the
prescription drug
comprises gamma
hydroxy butyrate
(GHB).
f)

directed to Xyrem. [T]oday we will ask you to discuss
NDA 21-196, for the use of Xyrem, gamma
hydroxybuturate or better known as GHB, for the treatment
of cataplexy and excessive daytime sleepiness in patients
with narcolepsy. (Ex. 1003 at p. 9:12-17).
Claims 6, 9 and 12-14
Claims 6, 9, 12, 13 and 14 are each independent claims, and they each
contain substantially similar claim language to claim 1. The differences between
the aforementioned claims in relation to claim 1 will be discussed in more detail
below. However, where claim limitations are substantially identical, the analysis
provided above pertaining to claim 1, including the claim chart, should be applied
to each of the other independent claims of the 059 Patent. (Ex. 1006 at 185204.)
Claim 6 is an independent claim with similar limitations to those recited in
claim 1. The differences between claim 6 and claim 1 are: the term medical
doctors in any and all medical doctors allowed to prescribe a prescription drug
in claim 1 is replaced with authorized prescribers; the exclusive computer
database is under exclusive control of the central pharmacy, instead of
associated with the exclusive central pharmacy; and instead of mailing or
sending by courier the prescription drug, as in claim 1, claim 6 requires
providing the prescription drug. (Ex. 1001 at col. 9:42-46.) These differences do
52
not change how Lilly in view of the DAC Transcript render the claims obvious.
(Ex. 1006 at 185-192.) Indeed, claim 6 is broader than claim 1 in some ways. As
explained above, Lilly in view of the DAC Transcript discloses all of the features
of claim 1. Accordingly, the DAC Transcript also discloses and renders obvious all
steps of claim 6.
The limitations of independent claim 9 are similar to those in claim 6. The
only difference is that claim 9 recites GHB as the prescription drug. (Ex. 1001 at
col. 10:1-34.) As explained above for claim 5, the specific drug disclosed in the
DAC Transcript was directed to Xyrem. [T]oday we will ask you to discuss
NDA 21-196for the use of Xyrem, gamma hydroxybuturate or better known as
GHB, for the treatment of cataplexy and excessive daytime sleepiness in patients
with narcolepsy. (Ex. 1003 at p. 9:12-17). Thus, Lilly in view of the DAC
Transcript teaches or renders obvious each and every limitation of claim 9. (Ex.
1006 at 185, 193-194.)
The limitations recited in claim 12 are substantially similar to claim 9. The
only difference is that instead of providing GHB to the patient, as recited by
claim 9, claim 12 requires mailing or sending by courier GHB to the patient...
(Ex. 1001 at col. 11:9-13.) This step was known in the prior art. (Ex. 1006 at
185, 195-198.) For example, the DAC Transcript states, [Xyrem] is sent to one
53
single national specialty pharmacy. Eventually, it goes by courier to patients with

narcolepsy. (Ex. 1003 at p. 178:4-6.) Thus, claim 12 is obvious.
Claim 13 includes the additional limitation of manufacturing GHB and
providing manufactured GHB only to the exclusive central pharmacy. (Ex. 1001
at col. 11:23.) The DAC Transcript explicitly discloses that Xyrem, known to
contain the active pharmaceutical ingredient GHB, is manufactured at one single
manufacturing facility and sent to one single national specialty pharmacy for
distribution. (Ex. 1003 at p. 178:3-8.). Therefore there the limitations of claim 13
are taught by Lilly in view of the DAC Transcript. (Ex. 1006 at 185, 199-201.)
Therefore claim 13 is obvious.
Claim 14 recites similar limitations as claim 6, but it does not require the
step of generating with the computer processor periodic reports via the exclusive
computer database to evaluate potential diversion patterns. (Ex. 1001 at col. 12:136.) Thus claim 14 would be obvious over Lilly in view of the DAC Transcript for
the reasons discussed above for narrower claim 6. (Ex. 1006 at 185, 202-204.)
In sum, following the teachings of Lilly in view of the DAC Transcript and
Camarda, a POSA would have combined the disclosed limitations as claimed with
no change to their respective functions. The claimed method steps were discussed
in detail in the prior art and were explicitly described in Lilly in combination with
54
the DAC Transcript. For all of these reasons, claims 1-6, 9 and 12-14 are obvious
over Lilly in view of the DAC Transcript.
C.
Ground 2: Claims 7-8, 10-11 and 15-16 are obvious over Lilly in
view of the DAC Transcript, Camarda and the CSR.
Dependent claims 7-8, 10-11 and 15-16 of the 059 Patent add limitations
concerning the dispensation of the prescription drugs. Lilly in combination with
the DAC Transcript, Camarda and the CSR teach these limitations.
1.
There is a motivation to combine Lilly, the DAC Transcript,

Camarda and the CSR
As discussed in Section VII.B above, a POSA would have had more than
ample reason to combine Lilly, Camarda and the DAC Transcript. (Ex. 1006 at
205-218.) Lilly teaches a prior art computerized system that was used to track
prescription data to prevent misuse and abuse of controlled substances. (Ex. 1002
at Abstract and 0002.) Camarda in turn teaches a method for encouraging patient
compliance with prescriptions by, in part, allowing for pharmacist intervention
where non-compliance is detected and giving patients educational materials as one
aspect of the intervention. (Ex. 1004 at pp. 108-110.)
A POSA would apply the teachings of Lilly and Camarda in the real-world
scenario of prescribing Xyrem that is addressed in the DAC Transcript in order to
prevent misuse of Xyrem and making sure the proper patients take it in the proper
way. (Ex. 1006 at 215-216.) Similarly, a POSA would be motivated to combine
55
Lilly, the DAC Transcript and Camarda with the CSR. (Id. at 217; Ex. 1003 at p.
176:3-6.) Like the DAC Transcript, the CSR is directed to a concern that
medically prescribed Xyrem may be diverted for illegal use, or may be consumed
accidentally (e.g., by small children), the sponsor has proposed a risk management
program. (Ex. 1005 at p. 108, sec. 14.1). As such, a POSA would be motivated to
look to the teachings of the CSR and Camarda to modify the teachings of Lilly,
which shares this concern, as Lilly and Camarda taught a method for implementing
the system disclosed in the DAC Transcript. (Ex. 1006 at 218.)
2.
The Combination of Lilly, the DAC Transcript, Camarda

and the CSR discloses all of the elements of claims 7-8, 1011 and 15-16
a)
Claims 7, 10 and 15
Each of claims 7, 10, and 15, which depend from independent claims 6, 9
and 14 respectively, require that when providing the prescription drug to the
patient comprises the central pharmacy authorizing the prescription drug to be
dispensed to the patient by another pharmacy. (Ex. 1001 at col. 9:52-55, 10:35-38,
12:37-40.) The CSR explicitly discloses If required by the patients insurance
company the product may be shippedto another pharmacy for pick-up. The
sponsor anticipates [that this will] be an unusual occurrence, and has a mechanism
for verifying the second pharmacys ability to protect against diversion of GHB
before shipping the drug there. (Ex. 1005 at p. 110 (emphasis added).) Thus, the
56
CSR explicitly discloses situations that involve having another pharmacy make
available the medication. (Id.; see also Ex. 1004 at col. 13:48-50.) This option is
readily combinable with the other claimed features by a POSA and would not
create any unexpected results or technological hurdles. (Ex. 1006 at 219-222.)
The following claim chart demonstrates how each limitation of claims 7, 10
and 15 was known in the prior art:
Claim
[7., 10., 15.] The
computerized
method of [claim 6]
[claim 9] [claim 14],
wherein providing
[the prescription
drug] [GHB] to the
patient comprises
the central
pharmacy
authorizing the
be dispensed to the
patient by another
pharmacy.
b)

The CSR reference states, If required by the patients
insurance company the product may be shippedto another
pharmacy for pick-up. The sponsor anticipates [that this
will] be an unusual occurrence, and has a mechanism for
verifying the second pharmacys ability to protect against
diversion of GHB before shipping the drug there. (Ex. 1005
at p. 110).
For claim 10: [T]oday we will ask you to discuss NDA 21196,for the use of Xyrem, gamma hydroxybuturate or
better known as GHB, for the treatment of cataplexy and
excessive daytime sleepiness in patients with narcolepsy.
(Ex. 1003 at p. 9:12-17).
Claims 8, 11 and 16
Claims 8, 11, and 16 depend from claims 7, 10, and 15, respectively, and
further recite that the another pharmacy places controls on the distribution of the
prescription drug. (Ex. 1001 at col. 9:56-67, 10:39-50, 12:41-53.) Claims 8, 11
and 16 identify specific controls that may be put in place.
57
Lilly guides a POSA towards a scenario where controls are placed by

another pharmacy. (Ex. 1006 at 225.) For example, [p]harmacists are constantly
challenged to circumvent duplication, abuse, fraud, and misuse of these
medications while providing a cost effective medication delivery system. In the
present health system the wide availability of pharmaceuticals from different
pharmacies raises the risks of negative drug interactions and its associated
destructive medical outcome. Pharmaceutical information control organization [ ]
can flag these issues in real time, thereby completely preventing or at least
minimizing their occurrences. Pharmaceutical information control organization [ ]
reduces or eliminates reliance on poorly trained pharmacy technicians or assistants
in ensuring compliance with the regulatory agency demands in the accurate
delivery of pharmaceuticals. (Ex. 1002 at 0057 (emphasis added).)
Further, the CSR teaches that the product may be shippedto another
pharmacy for pick-up. The sponsor anticipates [that this will] be an unusual
occurrence, and has a mechanism for verifying the second pharmacys ability to
protect against diversion of GHB before shipping the drug there. (Ex. 1005 at p.
110 (emphasis added).) Therefore, a POSA would have understood Lilly and the
CSR render obvious the elements of claims 8, 11 and 16. (Ex. 1006 at 223-228.)
The following claim chart demonstrates how each limitation of claims 8, 11
and 16 was known in the prior art:
58
Claim
[8., 11., 16.] The
computerized method of
[claim 8] [claim 11]
[claim 16], wherein the
another pharmacy
places controls on the
distribution of [the
prescription drug]
[GHB], the controls
selected from the group
consisting of confirming
with the patient that the
educational material has
been received and/or
read by the patient,
confirming receipt of
[the prescription drug]
[GHB] by the patient,
contacting the patient's
insurance company,
questioning early refill
requests by the patient,
flagging repeat
instances of lost, stolen,
destroyed or spilled
prescriptions, flagging
that the patient paid
cash for [the
prescription drug]
[GHB], flagging early
requests to refill [the
prescription
drug][GHB], and

If required by the patients insurance company the
product may be shippedto another pharmacy for pickup. The sponsor anticipates [that this will] be an unusual
occurrence, and has a mechanism for verifying the
second pharmacys ability to protect against diversion of
GHB before shipping the drug there. (Ex. 1005 at p.
110).
Pharmacists are constantly challenged to circumvent
duplication, abuse, fraud, and misuse of these
medications while providing a cost effective medication
delivery system. In the present health system the wide
availability of pharmaceuticals from different
pharmacies raises the risks of negative drug interactions
and its associated destructive medical outcome.
Pharmaceutical information control organization [ ] can
flag these issues in real time, thereby completely
preventing or at least minimizing their occurrences.
Pharmaceutical information control organization [ ]
reduces or eliminates reliance on poorly trained
pharmacy technicians or assistants in ensuring
compliance with the regulatory agency demands in the
accurate delivery of pharmaceuticals. (Ex. 1002 at
0057.)
Claim 11: The specific drug disclosed in DAC was
directed to Xyrem. [T]oday we will ask you to discuss
NDA 21-196, for the use of Xyrem, gamma
hydroxybuturate or better known as GHB, for the
treatment of cataplexy and excessive daytime sleepiness
in patients with narcolepsy. (Ex. 1003 at p. 9:12-17.)
59
Claim
limiting the prescription
to a supply of limited
duration.
D.
No evidence of secondary considerations rebuts the showing that

claims 1-16 are obvious
Evidence of secondary considerations should be considered and weighed as

part of the obviousness analysis, if it exists and has a nexus to the patent claims.
Leo Pharm. Prods., Ltd. v. Rea, 726 F.3d 1346, 1358 (Fed. Cir. 2013). Here, there
is no such evidence. (Ex. 1006 at 229-231.) Prior art pharmaceutical distribution
systems, such as Lilly, and patient compliance systems, such as Camarda, were
known to reduce misuse of regulated prescription drugs. (Id. at 230.) Likewise,
methods of distributing prescription drugs, such as Xyrem, were known in the
prior art as prone to abuse. (Id.) For instance, the DAC Transcript recorded a
meeting during which a controlled distribution program for Xyrem was
specifically discussed, and thus there are no unexpected results.
VIII. CONCLUSION
For at least the reason given above, claims 1-16 of the 059 Patent are
unpatentable because they would have been obvious over the cited prior art.
Respectfully submitted,
Date: April 6, 2015
By:
60
Daniel W. McDonald
3200 IDS Center
80 South 8th Street

Counsel for Petitioner
61
CERTIFICATE OF SERVICE ON PATENT OWNER

Pursuant to 37 C.F.R. 42.6(e), the undersigned certifies that on the 6th
day of April, 2015, a complete and entire copy of this Petition for Inter Partes
Review Under 37 C.F.R. 42.100, alongside an accompanying Power of Attorney,
Petitioners Exhibit List, and Exhibits 1001-1017, were provided via electronic
mail and UPS, postage prepaid, to the Patent Owner by serving the correspondence
address of record for the 059 patent.
Attorney of Record
Attn: David DZurilla
Schwegman Lundberg & Woessner
1600 TCF Tower
121 South Eighth Street
Tel: 612-373-6900
Email: ddzurilla@slwip.com
Respectfully submitted,
BY: /Daniel W. McDonald/
Daniel W. McDonald, Reg. No. 32,044
3200 IDS Center
80 South 8th Street

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Filed on behalf of Petitioner

COALITION FOR AFFORDABLE DRUGS III LLC

Daniel W. McDonald, Esq.

PETITION FOR INTER PARTES REVIEW OF U.S. PATENT NO. 7,895,059

MANDATORY NOTICES .............................................................................2

The Real Party-In-Interest (37 C.F.R. 42.8(b)(1)) .................................2

Notice of Related Matters (37 C.F.R. 42.8(b)(2))..................................3

Designation of Lead and Back-Up Counsel ..............................................5

Notice of Service Information (37 C.F.R. 42.8(b)(4)) ...........................6

PAYMENT OF FEES .....................................................................................6

REQUIREMENTS UNDER 37 C.F.R. 42.104 ............................................6

Grounds for Standing ................................................................................6

Identification of Challenge and Precise Relief Requested ........................7

Specific Art and Statutory Ground on Which the Challenge is

Evidence Relied Upon to Support the Challenge ..............................8

Person of Ordinary Skill In The Art..........................................................8

Overview of the 059 Patent .....................................................................9

State of the Prior Art ...............................................................................11

Claim Construction ........................................................................................18

VII. CLAIMS 1-16 ARE INVALID AS OBVIOUS OVER

Each Of The References Cited Is Available Prior Art. ...........................21

Lilly and Camarda are 102(e) prior art.........................................21

The DAC Transcript and the CSR are printed publications

The Combination of Lilly, the DAC Transcript and Camarda

There is a motivation to combine Lilly, the DAC Transcript,

The Combination of Lilly, the DAC Transcript, Camarda and

No evidence of secondary considerations rebuts the showing that

37 C.F.R. 42.63 ............................................................................................. 8

The Real Party-In-Interest (37 C.F.R. 42.8(b)(1)

Pursuant to 37 C.F.R. 42.8(b)(1), Petitioner certifies that Coalition For

Notice of Related Matters (37 C.F.R. 42.8(b)(2)

Designation of Lead and Back-Up Counsel

Pursuant to 37 C.F.R. 42.8(b)(3) and 42.10(a), Petitioner hereby

Notice of Service Information (37 C.F.R. 42.8(b)(4))

Please direct all correspondence to counsel at the above address. CFAD

REQUIREMENTS UNDER 37 C.F.R. 42.104

Grounds for Standing

Pursuant to 37 C.F.R. 42.104(a), Petitioner hereby certifies that the 059

Identification of Challenge and Precise Relief Requested

Specific Art and Statutory Ground on Which the Challenge

Pursuant to 37 C.F.R. 42.104 (b), Petitioner challenges Claims 1-16 of the

Evidence Relied Upon to Support the Challenge

Person of Ordinary Skill In The Art

A POSA is a hypothetical person who is presumed to be aware of all

relevant work experience. (Ex. 1006 at 38-41.) A POSA, as a practicing

Overview of the 059 Patent

State of the Prior Art

Risk management programs to help control the distribution of prescription

accountability, and better tracking and management of

The intervention may come in several forms, including providing

centralized distribution program to attempt to reduce abusive and illicit uses of

pp. 371:8-372:15, 374:7-375:23, 376:4-18.) As shown in the DAC Transcript slide

The DAC Transcript specifically discloses that the drug product is

interpretation, as understood by one of ordinary skill in the art. See 37 C.F.R.

7-8, 10-11 and

Proposed Statutory Rejections

For each asserted ground, Petitioner demonstrates below where each

Each Of The References Cited Is Available Prior Art.

Lilly and Camarda are 102(e) prior art.

Lilly qualifies as prior art under 35 U.S.C. 102(e). Lilly is a published

The DAC Transcript and the CSR are printed

publication, is considered to be a printed publication upon a satisfactory showing

to personally verify the drug usage of each purchaser to immediately detect