The latest case of Vectura vs. GlaxoSmithKline offers various insights on well-versed areas of patent law. This case touched upon aspects such as claim construction, infringement, and damages. Vectura Ltd. sued GlaxoSmithKline LLC and Glaxo Group Ltd. in the United States District Court for the District of Delaware, alleging that GSK infringed Vectura’s U.S. Patent No. 8,303,991 (991 Patent). Vectura alleged that GSK infringed its 991 patent through the sale of its Ellipta-brand inhalers. The jury of the United States District Court found that Vectura’s patent was both valid and infringed by GSK and that Vectura was entitled to a royalty payment of around $90 million as claimed. Also, GSK’s request for the post-trial motion for judgment was denied by the District Court. GSK appealed to the Court of Appeal for the Federal Circuit which gave the decision in favor of Vectura affirming the $90 million verdicts.

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Procedural Background

Claim 1 of Vectura’s 991 patent is an important part of this case. Composite active particles are used in the pharmaceutical composition for pulmonary administration, whereby each composite active particle comprises a particle of active material and particulate additive material on the surface of that particle of active material. It goes on to claim that additive material promotes the dispersion of the composite active particles upon actuation of a delivery device. Claim 2 limits the additive material of Claim 1 to a metal stearate or derivative thereof and Claim 3 derives itself from Claim 2 wherein the additive material includes magnesium stearate.

Vectura contended that the GSK’s sale of Ellipta brand inhalers including the Breo, Anoro, and Incruse devices. Vectura contends that GSK uses a multi-step mixing process” to prepare the mixtures containing magnesium stearate. It claimed that the infringing products feature one or more blisters which are sealed receptacles containing a single active ingredient, an excipient, and, optionally, additive material.

The district court rejected GSK’s argument that the term “composite active particles” includes a process limitation requiring that the composite active particles be produced by the milling process disclosed in Vectura’s patent. GSK's request for the post-trial motion was not accepted and Vectura was given the award of $89,712,069 as damages, reflecting 3% royalty on a royalty base.

Federal Circuit decision

GSK appealed the District Court Decision in the Federal Circuit on basic 3 issues. First, Vectura failed to prove that the infringing product uses additive material that promotes dispersion. Secondly, an ambiguous construction of the term composite active particle. Thirdly, on the Vectura’s calculation of royalty, to which GSK insisted its entitlement over the new trial of damages.

• Infringement

Federal circuit claimed that the test which was used to prove the infringing product’s use of magnesium stearate generally supported the view that coating the active ingredient with magnesium stearate improves the dispersion of the active ingredient. The Federal Circuit also relied on the abundance of other evidence supporting the jury’s finding, which includes testing evidence, testimony from infringement experts, as well as documentary pieces of evidence which were enough to prove that the infringing product use magnesium stearate.

• Claim Construction

Federal Circuit noted two cases which were Anderson Corps vs. Fiber Composites LLC and Continental Circuit LLC vs. Intel Corp. In both, the case the court recognized that ‘process steps can be treated as part of the product claim if the patentee has made clear that the process steps are an essential part of the claimed invention. Vectura’s claim on the requirement of a high milling process can be outweighed by the various indicators that such a process is merely a preferred process, thereby making the milling process not an essential part of the claim.

• Damages

The Federal Circuit held that “when a sufficiently comparable license is used as the basis for determining the appropriate royalty, further apportionment may not necessarily be required”, affirming the Vectura’s claim of royalty.

This case does revisit some of the most pressing and well-versed issues in Patent Law. The case makes us understand that while filing a patent application seeking to claim a product or apparatus must avoid indicating the process as an essential component of apparatus and product. This case also teaches us that while seeking damages based on a prior comparable license, the patentee must not apportion the royalty base to account for non-infringing components of the accused products and must also offer evidence showing prior license embodied the value of the asserted patent.

Author: Saransh Chaturvedi (an advocate) currently pursuing LLM from Rajiv Gandhi School of Intellectual Property Law (IIT Kharagpur).  In case of any queries please contact/write back to us at support@globalpatentfiling.com.