Scripps Clinic Wins Patent Ruling on Hemophilia Drug

Scripps Clinic and Research Foundation had its patent rights restored Monday by a special federal appellate court in a long-running dispute over whether biotech giant Genentech Inc. infringed on Scripps’ patent for an anti-hemophilia drug.

At stake are Scripps Clinic’s claims to patent royalties on all manufactured forms of the substance, called Factor VIII, and Genentech’s ability to recoup its investment in making the protein with genetic engineering techniques.

The decision in Washington set aside key parts of a Northern California federal judge’s trial findings, which largely had absolved Genentech of infringing on Scripps’ patent.

The three-judge panel hearing the case was the U.S. Court of Appeals for the Federal Court, which specializes in handling patent appeals. The panel summarily reversed some of the rulings and remanded other issues for retrial.

“We are delighted with the results,” said Arnold La Guardia, Scripps’ senior vice president and chief financial officer. “However, it is a complex legal issue, and we at this time don’t wish to comment further until we’ve had a chance to fully study it.”

William S. Feiler, the New York attorney handling the case for Scripps and its licensee, the Rorer Group Inc., called the decision largely a victory for his clients.

“Before the appeal, the patent was invalidated, so it wasn’t any good. Now it has the potential for being enforced again,” Feiler said.

Officials at Genentech, in South San Francisco, declined to comment because they had not fully considered the decision, spokeswoman Susan Rogers said.

Even though Genentech suffered a setback, however, the judges’ ruling amounts to merely a single skirmish in a war that will continue. It mainly gives Scripps a second chance to prove its case in the U.S. District Court for Northern California.

The rancorous tenor of the dispute was reflected in the 41-page decision.

“We have not repeated all the arguments and issues raised by both sides, including charges of frivolity, misstatement and worse,” wrote Judge Theodore Roosevelt Newman Jr. “ . . . Neither scientific nor evidentiary truth has risen easily to the surface. However, we DENY Scripps’ motion for sanctions against Genentech for filing a frivolous cross-appeal.”

The protein over which Scripps and Genentech are contending has long been known to be the key blood-clotting protein missing from the blood of hemophiliacs.

Before 1982, large quantities of donor blood were needed to isolate enough of the protein for it to be given to hemophiliacs.

Then Theodore Zimmerman and Carol Fulcher perfected a process at Scripps to isolate Factor VIII more precisely and to characterize it better than had ever been done. They did so by making other molecules, called monoclonal antibodies, that could latch onto Factor VIII at the molecular level.

This process, patented by Scripps first in 1982 and then modified later, is the basis for the dispute.

Scripps filed several separate suits against Genentech and two other firms working to develop a recombinant Factor VIII, Miles Inc. and Chiron Corp. The recombinant form of the drug is preferable because it carries no risk of transmitting AIDS or hepatitis.

Scripps alleged in its suits that the recombinant form of Factor VIII could not have been developed without using the patented Scripps technology as a basis.

In a ruling on Feb. 24, 1990, U.S. District Judge William Schwarzer in San Francisco rejected most of Scripps’ patent infringement claims by summary judgment.

The appeals judges disagreed with some of Schwarzer’s uses of summary judgment in the Factor VIII dispute.

They said he in some cases wrongfully used the summary judgment process where facts were in dispute. In other areas where summary judgment was appropriately used, they reversed his conclusions.

In key parts of the ruling, the appeals court judges:

* Reversed the lower court’s finding that Scripps has deliberately overstated the purity of its Factor VIII, and remanded the issue for trial. This had been the basis for judging the original patent as unenforceable.

* Reversed the finding that the revised Scripps patent had been filed for insufficient reason. The appeals judges found in Scripps favor on this count.

* Reversed Schwarzer’s finding that a 1979 dissertation written by someone outside Scripps “anticipated” the Factor VIII findings and thus invalidated the patent.

* Agreed with Genentech that it was not completely clear that recombinant Factor VIII infringes on the product claims owned by Scripps.