Eli Lilly & Co. v. American Cyanamid Co.

Eli Lilly and Company (Lilly) (plaintiff) developed an antibiotic drug named cefaclor. Cefaclor was a cephum compound, and it required an intermediate compound called enol cephum for its production. The enol cephum was processed through several steps to obtain the final cefaclor product. Lilly purchased a patent covering a method for producing Compound 6, which is a type of enol cephum intermediate. Compound 6 and cefaclor were both based on a cephum nucleus, but the compounds were comprised of different carboxyl groups, resulting in different antibiotic potency. The process required four additional chemical steps to create cefaclor from Compound 6, during which hydroxyl groups were added and removed. Biochimica Opos, S.p.A. (Opos) (defendant) manufactured cefaclor in Italy and sold it to Zenith Laboratories, Inc., American Cyanamid Company, and Biocraft Laboratories (cefaclor purchasers) (defendants), for distribution in the United States. Lilly sued the cefaclor purchasers and Opos, seeking a preliminary injunction. Lilly argued that the importation into the United States of cefaclor produced abroad infringed its patent because Opos used Lilly’s patented Compound 6 manufacturing process as part of its cefaclor-production process. The district court found that Lilly was not likely to be successful on an infringement claim. The court reasoned that although Opos used Lilly’s patented process to create Compound 6 in Italy, the Compound 6 was materially changed by subsequent processes before becoming its final product, cefaclor. This change occurred before the product was imported into the United States. Lilly appealed.