Zenith Labs., Inc. v. Bristol-Myers Squibb Co.

Zenith Labs., Inc. v. Bristol-Myers Squibb Co.

Opinion

 [***1285]   [*1419]  PLAGER, Circuit Judge.

The question in this declaratory judgment action is whether a drug compound, which in [***1286]  its manufactured state does not infringe the patent in suit, becomes infringing as a result of transitory chemical changes that occur in vivo, that is, as a result of ingestion by the patient. There are fact issues -- what changes actually occur when the drug is ingested, and how do we know; there are legal issues -- does a compound that changes in the [**2]  human body into the patented product on its way to becoming the active ingredient in the drug (the original patent on the active ingredient having earlier expired) literally infringe, infringe under the doctrine of equivalents, or infringe by inducement.

The District Court for the District of New Jersey, Civil Action No. 91-3423, entered judgment, following a bench trial, that plaintiff/appellant Zenith Laboratories, Inc.'s (Zenith) commercial sale of cefadroxil DC induces infringement of U.S. Patent 4,504,657 (the '657 patent), ¹ the patent at issue. Zenith Lab. Inc. v. Bristol-Myers Squibb Co., 1992 U.S. Dist. LEXIS 11540, 24 U.S.P.Q.2D (BNA) 1652 (D.N.J. 1992) (Zenith II). The '657 patent is owned by Bristol-Myers Squibb Co. (Bristol). For the reasons set forth, we reverse.

BACKGROUND

The chemical compound cefadroxil, an antibiotic of the cephalosporin family effective against bacteria that are [**3]  resistant to penicillin, was described and claimed in United States Patent No. 3,489,752 (the '752 patent), which issued in 1970; the owner was Bristol. The claims of the '752 patent covered any and all forms of cefadroxil -- they described the chemical compound per se. The '752 patent expired in 1987.

In the meantime, Bristol set to work to find a commercially useful crystalline form of the compound that would overcome problems related to manufacture of the product so that it would be usable by humans. The task of developing a commercial production process was assigned to certain of Bristol's chemists. They developed what became known as the Bouzard monohydrate, named after one of the discoverers -- a new crystalline form of cefadroxil. Unlike prior forms of cefadroxil, Bouzard monohydrate possesses certain characteristics in its pre-ingested, powdered form, related to bulk density, solubility, and stability (manufacturing-related characteristics), which make it particularly suitable for packaging into capsules.

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