Almost simul­taneously Cyanamid had realised the therapeutic importance of tetracycline and lodged a patent application on 16 March 1953. A third company, Heyden Chemical Corporation, had also produced tetracycline and lodged its patent claim on 28 September 1953. Bristol was the last to file on 19 October 1953.
All parties were aware of the fact that they had insecure claims on the patent and that a ruling that tetracycline was unpatentable, in that it was 'no advancement over prior art', was probable. By attacking each others' claims they would certainly destroy anyone's chances of getting the patent. Cyanamid first eliminated the threat from Heyden by buying its antibiotic division for $12,(XX),000, approximately twice the book value of its assets. The US govern­ment claimed that Cyanamid's purchase of Heyden was unlawful, being in contravention of the Clayton Act.
In January, 1954 Pfizer and Cyanamid agreed not to destroy each other's chances of securing a legal monopoly over tetracycline. The written agreement provided that whichever one secured the patent would license the other to sell the drug. The agreement further provided for a private adjudication to determine which of the two was the first inventor. Pfizer won and duly cross-licensed Cyanamid. Cyanamid also agreed to supply Pfizer with bulk tetracycline until its production facilities could be tooled up for mass production. This provision was to prevent Cyanamid from establishing its brand name before Pfizer got on the market. Hence the evidence suggests that the patent provided a cover for conspiratorial behaviour to partition a market which in the absence of the patent would have been clearly illegal.
Unlike Pfizer and Cyanamid, the last patent claimant on the scene, Bristol, was a small company in those days, and the former regarded it as no match for them in a patent struggle. However, in October 1954 the patent-hearing examiner, in dissolving the inter­ference between Pfizer and Bristol, ruled that 'on the examiner's assumption that tetracycline was inherently produced by the process disclosed in' the Cyanamid patent on chlortetracycline, tetracycline itself was not patentable. Hence the examiner's con­clusion was that Pfizer had identified tetracycline as one of a number of drugs produced in an 'old process' and therefore constituted no advancement over prior art.
This setback caused Pfizer's patent agent to direct Pfizer scientists to evaluate the examiner's assumption of co-production. Subse­quently the research was stopped, however. Yet the tests were in fact continued and the results recorded outside the normal labora­tory records. These secret data showed the examiner's assumption to be correct, according to the government's evidence.
Apart from the concealment of test results, it was alleged that Pfizer rigged other tests. The examiner had agreed to readmit the application if Pfizer could demonstrate that tetracycline could not be recovered from fermentation broths produced in accordance with the chlortetracycline process patent. Government evidence indicated that the micro-organisms selected by Pfizer for this test were known to be poor producers of antibiotics, and that the whole test procedure was structured to minimise antibiotic production and discovery. The patent was granted, but the patent examiner was later to testify that if he had known of the technical conditions under which the Pfizer test had been conducted, he would not have granted the patent.
The government argued that Cyanamid was a party to this fraud on the patent office in that its support for the Pfizer affidavit that co-production did not occur went beyond mere silence. It is clear that Bristol knew that co-production did occur. Bristol's alleged strategy was to assist Pfizer in obtaining the patent through mis­representation and then use that information to force a licence out of Pfizer.
Pfizer refused to grant Bristol a licence. Negotiations broke down on the foreboding note of Schwartz of Bristol saying to Powers of Pfizer: 'I hope this isn't going to be a dirty fight, John.' Powers replied: 'It's going to get very rough but it won't be dirty.' Bristol called Pfizer's bluff and began to sell tetracycline in violation of the Pfizer patent on 30 April 1954. Bristol did not have a promotional network to handle large-volume sales, so it sold bulk tetracycline to Squibb and Upjohn. Squibb and Upjohn gave Bristol legal muscle by indemnifying them against any patent infringement suit. Pfizer sued. But as Bristol counsel, Walker, later testified, they were determined to 'impress Pfizer that Bristol was no babe in the woods'.
This they surely did. Bristol privately sent Pfizer a 12-page 'Statement of Facts'. These 'facts' included Bristol's belief that the Pfizer patent had been fraudulently obtained, that the purchase of Heyden and many other collusive practices by Pfizer and Cyanamid were in violation of the Clayton and Sherman Acts, and that Bristol was in a strong position both to destroy the patent and recover treble damages in a private antitrust suit.


 

 

 

 

 

 

 

 

 

 

 

 

   
 
  Pfizer first discovered the molecular structure of tetracycline and filed a patent application on it on 23 October 1952...
Pomodliłem się do każdego boga jaki istniał bym był w wstanie wkurzyć tę kobietę do granic możliwości.