All Elements Rule Precludes Infringement of Cyclosporin Patent.

Reversing a district court's claim construction of Novartis' patent relating to pharmaceutical cyclosporin compositions, the U.S. Court of Appeals for the Federal Circuit nevertheless upheld the district court's ruling of non-infringement, noting that the "all elements" rule precluded Novartis' theory of infringement by equivalents. Novartis Pharms. Corp. v. Abbott Labs., Inc., Case Nos. 03-1367, -1393 (Fed. Cir. July 8, 2004) (Prost, J.) (Bryson, J., dissenting).

Novartis sued Abbott, alleging infringement of U.S. Pat. Nos. 5,342,625 (the `625 patent) and 6,007,840 (the `840 patent), both relating to pharmaceutical cyclosporin compositions administered to prevent organ rejection in transplant patients. A jury found that Abbott did not infringe the `625 patent, but did infringe a claim of the `840 patent under the doctrine of equivalents. Abbott moved for a judgment as a matter of law (JMOL) that it did not infringe the `840 patent.

The claim in issue recites a pharmaceutical cyclosporin composition that additionally contains a hydrophilic component, a "lipophilic component" and a hydrophilic surfactant. Abbott's accused cyclosporin formulation, Gengraf, allegedly contained only hydrophilic excipients and the surfactant Span 80, asserted by Abbott not to be a "lipophilic component." Relying, inter alia, on the specification of the `625 patent, the district court concluded that surfactants cannot be components of the lipophilic phase and found, as a matter of law, under the specific exclusion principle, that Novartis was precluded from urging Span 80 to be an equivalent to the claimed "lipophilic component." Accordingly, the district court concluded that Novartis could not prevail under the doctrine of equivalents and granted Abbott's JMOL on the `840 patent. Novartis appealed.

The Federal Circuit rejected Abbott's argument that collateral estoppel would preclude Novartis from challenging the claim construction and the JMOL with regard to the `840 patent because Abbott had not met its burden of showing that the district court's claim construction of the term "lipophilic component" was necessary to the jury's non-infringement decision for the `625 patent. Then, turning to the construction of the claim term in issue, the Court found that "lipophilic component," had no "well-defined" meaning to those skilled in the art and proceeded to consider based on the `840 patent specification teaching that a surfactant may serve as a co-solvent to form a part of the lipophilic phase that dissolves the cyclosporin. Based on this teaching, the Court reversed the district court's conclusion that surfactants cannot be components of the lipophilic phase. Nevertheless, while agreeing with Novartis that surfactants may form a part of the lipophilic component, the Court pointed to the same language as showing that the lipophilic component cannot be composed entirely of surfactants and therefore affirmed the district court.

In his dissent, Judge Bryson argued that the specification did not contain a specific exclusion of Span 80 as the "lipophilic component."

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