Patent Docs

News from Abroad -- Australia Remains a Gene-Patent Friendly Jurisdiction

By Grant Shoebridge* --

When the Australian High Court ruled against the patentability of isolated naturally occurring genes in the Myriad decision, a number of commentators believed that the decision would ultimately invalidate claims directed to methods involving the practical application of genes.  A recent Federal Court decision, however, has confirmed that claims directed to methods involving the correlation of gene sequences to a particular trait in cattle are patent eligible subject matter in Australia.

Background

This case concerns an appeal of an unsuccessful Patent Office opposition, by Meat & Livestock Australia Limited (MLA) and Dairy Australia Limited against Australian patent application 20102022253 (the 253 Application), in the name of Branhaven LLC and Cargill, Inc., directed to animal genomics and the genetic improvement of livestock.  The claims relate to methods of identifying beneficial traits in cattle using gene sequence analysis, and specifically the identification of single nucleotide polymorphisms (SNPs).

Gene-based patentable subject matter

The principal attack on the 253 Application involved arguments and evidence that the claims did not define patent eligible subject matter.  At the outset, the Judge, Beach J., made it clear that the case did not merely involve the discovery of a correlation between genotype and phenotype.  Rather, the Court considered this to be the starting point for the analysis rather than the finishing point in relation to determining patentability.

The submissions made by MLA relied heavily on the findings of the High Court in the Myriad decision.  The Court, however, ultimately found these submissions unpersuasive on the basis that the Myriad decision centred on the patentability of claims defining isolated naturally occurring gene sequences per se rather than methods of using gene sequences.  The Court therefore concluded that the reasoning of the Myriad decision did not assist MLA.  In support of this conclusion, Beach J. indicated that there was no suggestion in the Myriad decision that claims to methods involving the practical application of gene sequences could be dismissed as being, in substance, patent ineligible naturally occurring genetic information.

Patent eligible subject matter under Australian law is required to be an artificially created state of affairs having economic significance.  As the claims of the 253 Application cover practical applications of identifying SNPs from a bovine nucleic acid sample and their association with a trait of interest, the Court found that the claims were directed to artificial subject matter resulting from human action, rather than something that exists in nature per se.  The decision also makes it clear that it is inappropriate to focus on individual elements of claims, such as SNPs and their association with a particular trait -- these being naturally occurring phenomena.  For these reasons the claims were found to be "within the plain vanilla concept" of patentable subject matter.

Chilling effect on innovation

MLA further submitted that the claims if granted would have a chilling effect on future research in the livestock industry in Australia contrary to the interests of the Australian public.  The "chilling effect" on innovation was one of a number of "other factors" considered by the High Court in the Myriad decision as being important considerations in determining patent eligible subject matter.

In rebutting MLA's arguments, the Judge identified an Australian granted patent, listing MLA's experts as the inventors (the AV/Goddard patent) and stated that "if MLA's chilling effect point was good, then the AV/Goddard patent would be an example par excellence".

The Judge also clarified that the breadth of claims per se is not indicative of a lack of patentable subject matter.  A complaint about the breadth of claims is something that arises under other grounds of invalidity, such as a lack of clarity or a failure to define the invention.  The Court concluded that none of the "other factors", point against patentability -- they all consistently point in one direction, namely patentability.

The misaligned Australia/US position on gene-based patentable subject matter

MLA also submitted that as a matter of coherency with US law, the claims should be held to be invalid based on a lack of patentable subject matter having regard to decisions in the US, which have rejected claims to methods of diagnosis based on discoveries or principles of nature; for example, Mayo Collaborative Services v Prometheus Laboratories, Inc. 566 U.S. 66 (2012), and Ariosa Diagnostics Inc. v Sequenom, Inc. 788 F.3d 1371 (3d Cir. 2015).  These submissions were rejected by the Court for three reasons.  Firstly, the Judge found that he could not determine coherency with foreign law generally by only considering cherry-picked jurisprudence from one jurisdiction.  Thus, consistency with one foreign jurisdiction might produce inconsistency with another foreign jurisdiction.  Secondly, the Court found it necessary to apply an evolving concept of patent eligible subject matter in the context of Australian legislation and Australian conditions, not any foreign law approach.  Thirdly, the Judge pointed out that the US approach accepts that a method involving the application of a "law of nature" may be patent eligible.

Notable, Beech J said nothing in relation to the US Ariosa Diagnostics Inc. v Sequenom, Inc. decision as the corresponding Australian case has been set down before him for August 2018.

Conclusions

Ultimately, the single ground upon which MLA succeeded was that of lack of clarity.  The Judge, however, provided a specific indication as to how claim 1 and analogous claims could be amended to render the claims valid.  This strongly suggests that the amendments will be allowed, and the patent application granted.

The significance of this Federal Court decision is twofold.  Firstly, given the nature of the claims, the 253 Application, once it is granted, may significantly impact the use of genomic analysis in the Australian livestock breeding industry.  Secondly, and perhaps more importantly, the decision provides certainty in relation to the patentability of claims defining practical applications of gene sequences, including methods of genetic screening.  In this regard, the decision potentially foreshadows the outcome of the Sequenom and Ariosa case, concerning the patentability of genetic testing methods.

* Grant Shoebridge, Principal, Shelston IP

News from Abroad -- Mexican Antitrust Authority Study on Generic Drug Entry – Recommendations on Changes to Public Policy -- Part IV

By Juan Luis Serrano* --

In the first three installments of this series, we've explained the general purpose of the study, and gone through the sections of patents, marketing authorizations and strategic behavior of the study published on August 9, 2017 by the Federal Commission for Economic Competition[1].  For this fourth installment, we'll go through the first eight recommendations that COFECE issues to provide better conditions for generic drug competitions.

For the purposes of this series, we'll refer to Mexican authorities by their acronyms; COFECE for the antitrust body, COFEPRIS for the regulatory authority, and IMPI for the patent office.

Let's review the main contents of each recommendation by COFECE.

"1. COFEPRIS should specify, in the list of reference drugs, the specific patents covering the drug and their expiry date, in order to provide transparency to the linkage and patent protection system.  COFEPRIS can create this list with information on patents to be provided by IMPI through a government offices inquiry."

I consider that the idea here is correct, but it's missing a) the involvement by the patent holder, to tell the government precisely which patents are relevant to an approved reference drug, and b) a possibility for both the patent holder and the generic drug applicant to be heard on the possible invasion/invalidity of patent rights during the marketing authorization proceeding.

An analysis could also be made on whether our Country should provide an incentive to the generic applicant to initiate an invalidity action, such as the 6-month period granted in the U.S.

"2. IMPI and the Ministry of health should jointly evaluate the convenience of including in the Industrial Property Law regulations a limitation on the granting of secondary patents, as has been done in other countries.

This recommendation substitutes those which are meant to provide transparency to the linkage system, and it may end up being redundant if the linkage system is improved".

This recommendation seems to need a lot more work in order to be duly supported; whereas it is correct that some countries have indeed limited the patentability of some inventions, this should be done not just as an isolated decision, but as a full policy analysis on incentives to innovate versus generic drug competition.

In addition, I do not agree with the argument of this recommendation being "substitute" of transparency in a linkage system.  Said transparency is necessary regardless of patentability standards, and the recommendation to limit certain patents would have a bigger impact on entry times for competing products, for obvious reasons.

"3. Establish explicit restrictions to the linkage system in order for patents registered (sic) after the marketing authorization for a reference product is granted will not be considered for linkage analysis for the same reference product.

This does not limit laboratories from using their patents - granted after the reference product marketing authorization has been approved - to develop second generation, or other types of drugs."

The proposed restrictions have some sense to them, when one considers that drugs in the reference product list are the benchmark for generics to imitate.  It would be necessary however, to determine the situation with patent applications filed before the reference product designation, but granted afterwards.

"4. COFEPRIS should grant a new marketing authorization when a laboratory requests the modification of an authorization for a reference drug, based on a marginal improvement which is associated with a new patent, that will expire after those patents granted when the initial authorization was issued.

The registration of the original reference product would stay in force after patent expiration, in order for generic products to use it as reference.

The purpose of this proposal is to prevent marginal innovations over a reference drug with a patent close to expiration to create an obstacle to the entry of generic products which reference the original drug, as said innovations are commonly associated to the registration (sic) of new patents".

The main problem with this recommendation is the term "marginal innovations", which is not defined, and will certainly be seen as negative by patent holders.  Otherwise, the idea of having more than one reference product makes sense as patent infringement situations would be avoided.

"5. COFEPRIS should promote the use of the Bolar exception through the publication of rules and criteria under which it can be requested, and periodically publish the list of innovative drugs for which patents will expire in the following 3 years."

This is a clear reference to the orange book rules, which allow a generic drug applicant to request "paragraph III certifications" for marketing authorizations to be issued right after patent expiration.  This seems to be a positive policy recommendation.

"6. COFEPRIS should finish completing the database of marketing authorizations and make it available online, to the public, with information beyond five years, and to keep said database updated.  The database must include public information on consultations to IMPI and response times by COFEPRIS.

This information will provide transparency to the process of market entry, and will remove discretional spaces which may provide incentives for unnecessary entry obstacles."

This is a welcome recommendation, which has been expressed before COFEPRIS by both innovator and generic drug companies.  The database has not been updated in years, and the current situation forces companies to go through transparency requirements which can take 2 months before a response is issued.

"7. COFEPRIS should guarantee and communicate that the process of marketing authorization is done in a first in – first out basis, and not accumulate the issuance of the authorizations in packages or batches.

This mechanism looks to benefit the laboratory that filed an earlier application, which constitutes an incentive to take advantage by having market presence.  The current strategy by COFEPRIS is the announcement of release of marketing authorizations in "package" forms, which does not generate adequate incentives for generic manufacturers to take a lead over competitors upon filing."

This recommendation makes a lot of sense.  The marketing authorizations should be issued as soon as they are ready, and the current practice could be substituted with announcement of those authorizations issued in the previous semester/year.

"8. COFEPRIS should issue technical criteria for the consideration that the generation of clinical data by an applicant represents "considerable effort."

This measure seeks to close the door on litigation generated on alleged violations to clinical data protection.

This recommendation appears to oversimplify a complex issue, which derives from international treaty obligations and which is not properly regulated in our laws.

Currently, as mentioned in the study, clinical data protection is established as an obligation in NAFTA and TRIPS.  COFEPRIS issued an internal memorandum in 2012 which refers to this form of protection, but that document does not constitute a mandate and is certainly not the proper way to regulate a granted right.

On the "considerable effort" side, there are varying positions in other countries:  In broad terms, the U.S., Canada and Europe consider that simply by obtaining a new drug product registration considerable effort was present in the clinical trials process.  In contrast, countries such as Colombia have tried to establish criteria (such as the amount of money spent) to determine if the effort was indeed considerable and thus if it merits protection.

I think that the study addresses the problem from the wrong angle.  If the intention is to avert litigation proceedings, transparency on specific periods of protection for all interested parties will do more than a high or low bar on what is considerable effort.

In Parts V and VI of the series on the COFECE study, we will analyze the sections on "insufficient response from the demand side" which refers to information available to physicians and patients and "Entry of generic drugs to public procurement processes".

* Mr. Serrano is Of Counsel with ROMO DE VIVAR V.IP SERVICES, S.C.

News from Abroad -- No Pharmaceutical Extension of Patent Term for Swiss Type Claims in Australia

By Adrian M Trioli* & Noelene Treloar** --

The Australian Full Federal Court's recent decision in Commissioner of Patents v AbbVie Biotechnology Ltd [2017] FCAFC 129 confirms that an extension of patent term for pharmaceutical substances does not extend to Swiss type claims.

The decision highlights that Swiss type claims do not fall within the relevant legislative provisions for patent term extensions under (i) section 70 (2)(a) for a pharmaceutical substance per se, or (ii) section 70 (2)(b) for a pharmaceutical substance when produced by a process that involves the use of recombinant DNA technology.

Background:

Section 70(2)(b) of the Patents Act 1990 (Cth) (the Patents Act) allows for the term of a standard patent to be extended in circumstances where one or more pharmaceutical substances, when produced by a process that involves the use of recombinant DNA technology, must in substance be disclosed in the complete specification of the patent and in substance fall within the scope of the claim or claims of that specification.

AbbVie Biotechnology Ltd (AbbVie) is the patentee of three (3) Australian patents directed to use of its blockbuster drug adalimumab, marketed under the brand name Humira™.  The drug has been successful in the treatment of diseases including rheumatoid arthritis, rheumatoid spondylitis, Chrone's disease and ulcerative colitis.

AbbVie sought an extension of term to its Australian patents in accordance with section 70(2)(b) of the Patents Act.  In August 2015, the Deputy Commissioner of Patents denied the extension of term request on the basis that the condition in section 70(2)(b) had not been satisfied as the relevant patent claims were directed to a therapeutic use of adalimumab, and not directed to the pharmaceutical substance when produced by a process that involves the use of recombinant DNA technology.

AbbVie appealed the decision to the Administrative Appeals Tribunal, and the Tribunal set-aside the Deputy Commissioner's decision.  The Deputy Commissioner appealed to the Full Federal Court.

Full Federal Court Decision:

The Full Federal Court of Australia held that adalimumab is a pharmaceutical substance produced by recombinant DNA technology.  However, the relevant patent claims were Swiss type claims directed to (i) a method or process in which adalimumab is used to produce a medicament, and (ii) a medicament containing adalimumab that is to be used for specific therapeutic purposes.  As such, the Swiss type claims were use claims (or characterised as method or process claims) and therefore did not meet the requirements of section 70(2)(b) that require product claims.  The extension of patent term from 20 years to 25 years in Australia was thereby denied.

* Adrian M Trioli, Principal, Adrian M Trioli Patent and Trade Mark Attorney
** Noelene Treloar, Of Counsel, Adrian M Trioli Patent and Trade Mark Attorney

News from Abroad -- Mexican Antitrust Authority Study on Generic Drug Entry -- On Patents and Marketing Authorizations -- Part III

By Juan Luis Serrano* --

In the first and second installments of this series, we've explained the general purpose and the patents and marketing authorizations sections of the study published on August 9, 2017 by the Federal Commission for Economic Competition[1].  In this third installment we take a look at the sections on strategic behaviour and the analysis on litigation cases.

For the purposes of this entry, we'll refer to Mexican authorities by their acronyms; COFECE for the antitrust body, COFEPRIS for the regulatory authority, and IMPI for the patent office.

The section on Strategic Behavior of the study by COFECE (3.4), is heavy with criticism to the innovative pharmaceutical industry; it starts with references to evegreening practices, and patent clustering as a way to block generic entrances.

Whereas the study does mention the main argument in favor of allowing several patents related to a single drug product (inventive merit on new formulations or uses), it quotes the policy decisions taken in countries such as Argentina and India which have limited this possibility, mentioning that such policies have required countries to strike a balance between national interests and TRIPS.  There is also a reference to the practice in Brazil requiring the regulatory authority to provide a green light before a patent is issued.

The angle of the study in favor of the generic side of industry is clear in the section related to product switching (explained as a marketing strategy leading physicians to a new formulation of an existing product to take advantage of a more recent patent); there is a direct reference to the position of ANAFAM (a major association of generic drug manufacturers) on the issue without a counter-argument from the innovator's association.

This section concludes with a reference to pay for delay agreements which have been subject of antitrust analysis and litigation in the U.S. and Europe, but does not indicate whether any such agreement has taken place in Mexico or not.  The Mexican legal system does not force companies to automatically report such an agreement, but if one takes place it could be subject of review by COFECE.

Overall, this section leads the reader to think that the current environment in Mexico is slanted in favor of innovator companies, with an underlying message that the authority will start to look at actions that have been found as anticompetitive in other markets to study them here.

Special relevance comes from the fact that the message is issued by a Government office; whereas other factors would certainly be in play before any major policy decision is taken (the position by Congress and the Patent Office, and current NAFTA renegotiations which will include IP related discussions), it seems clear that we should expect additional activity from COFECE on the review of practices which have been sanctioned abroad.

In the section "litigation related to patents and marketing authorizations" (3.5), the study lists some of the major judicial and policy decisions that have shaped the current regulatory environment for generic drug entry in the past 20 years, as follows:

a)    The enactment of linkage regulations in 2003, which were initially interpreted by authorities as limited to patents covering active pharmaceutical ingredients;
b)    The creation of a specialized IP Court in 2008;
c)    The Supreme Court decision of 2010 establishing that linkage should be broadly interpreted to include formulation patents;
d)    The addition of an opposition system to patent applications in the IP Law, also in 2010 (which does not extend to granted patents); and
e)    The reform to the IP Law ordering the patent office to publish all decisions which modify a granted patent or trademark.

The study then explains that litigation has taken place in the form of patent infringement actions, challenges to applications or authorizations granted to generic drug manufacturers, and judicial petitions of recognition of Regulatory Data Exclusivity.

Two additional shots are fired at patent holders:  on page 52, first paragraph, the study states:

"Upon making this study, we had knowledge that some holders of patents related to an active ingredient which are already in the public domain, have intended to cause confusion in authorities in charge of the purchase of drugs for the public sector and Courts, even trying to persuade their competitors by informally warning them of the initiation of and infringement proceed if (said competitor) does not refrain from manufacturing any product with the relevant active ingredient."

This statement refers to acts which could be subject to antitrust or even criminal investigations.  Again, this becomes quite relevant when the source is not an independent writer, but a Government office.

The last paragraph of page 52 is also relevant:

"In summary, innovative laboratories can extend product market exclusivity through the abuse of judicial proceedings established in our laws and thus place obstacles to generic drug entry to the market.  This calls for a review of the linkage system in order to have a transparent tool between marketing authorizations and industrial property rights and with this reduce possible spaces of litigation which seek to delay generic entry."

Whereas as mentioned in the first entry of this series, I agree with the need for transparency, the blanket reference to judicial proceedings as abusive does seem over the top.  I would argue that those judicial proceedings are not necessarily abusive per se but are on many occasions the only resource available to prevent or correct the actual invasion of a granted right.

The section closes with a summary of litigation cases, by active ingredient, indicating the parties and patents involved, and those cases where regulatory data exclusivity has been requested by judicial means.

In part IV of the series on the COFECE study, we'll look at the first eight recommendations of policy changes.

* Mr. Serrano is Of Counsel with ROMO DE VIVAR V.IP SERVICES, S.C.

News from Abroad -- Mexican Antitrust Authority Study on Generic Drug Entry -- On Patents and Marketing Authorizations -- Part II

By Juan Luis Serrano* --

In the first installment of this series, we outlined the general contents of the study published on August 9, 2017 by the Federal Commission for Economic Competition[1], highlighting that the Antitrust authority is calling for an overhaul of several aspects of the drug market in Mexico to promote competition.  In this second installment, we delve into the patents and marketing authorizations sections, including the author's comments on the study's recommendations.

For the purposes of this entry, we'll refer to Mexican authorities by their acronyms; COFECE for the antitrust body, COFEPRIS for the regulatory authority, and IMPI for the patent office.

The patents section of the study (3.1), contains an explanation of the status in Mexico for patent granting, explaining that Mexico allows for several types of patents on pharmaceutical products, including those covering active ingredients and its variants, formulations, uses and processes.  This section is mostly academic, and does not require much additional comment.

This is followed by a section on drug marketing authorizations (3.2), where the first shots are fired; COFECE criticizes some of the positions taken by COFEPRIS, such as forming "generic approval packages" (several approvals are issued in bulk, along with a press conference, instead of approving products on a first filed/first released basis), a lack of adherence to regulatory approval times, and a lack of transparency on available information on marketing authorizations at COFEPRIS' website.

Fixing these problems will fall mostly on COFEPRIS.  Information available on authorization processes (both for innovators and generics) is indeed sorely lacking, and the rates of approval within the regulatory timeframes are low, for all industry participants.

The next section (3.3) delves into our linkage system, which was enacted in 2003, has been subject to partial Supreme Court review, and has substantial differences with the one established in the U.S. through the Drug Price Competition and Patent Term Restoration Act of 1984.

The study points two major problems with linkage; lack of transparency is the first, as inquiries on possible patent infringement are done in communications between COFEPRIS and IMPI without any immediate disclosure or right of hearing by the applicant or the patent holder.  Transparency mechanisms do allow companies to obtain copies of these communications, but many times after decisions have already been taken.

The second problem is that patents listed in the linkage gazette are not necessarily related to an approved drug product.  Any patent covering an active ingredient or formulation can be listed regardless of whether it covers a product which would be subject of generic competition or not.

This is one of the sections where I agree with COFECE; the system, in order to function properly for both innovators and generic manufacturers should allow interested parties to know precisely which patents are covering an approved product, and both generic drug applicants and patent holders should have an opportunity to be heard, either before administrative authorities or in an infringement proceeding, before an authorization is granted or denied.

The following section of the study will be quite interesting for both companies and policy makers; section 3.4 "Strategic behavior" refers to concepts that innovative companies will very likely object to, such as patent evergreening, patent clustering, and reference product switching based on new patents.  There are also references to positions taken by other Latin American countries such as Brazil (which subjects some patents to prior approval by regulators) or Argentina (which forbids the grant of several types of pharmaceutical patents).

These sections are followed by an explanation on past litigation activity on these topics, mentioning that it has been used as a deterrent to generic competition, and several recommendations, both of which will be analyzed in a subsequent post.

* Mr. Serrano is Of Counsel with ROMO DE VIVAR V.IP SERVICES, S.C.

[1] https://www.cofece.mx/cofece/index.php/prensa/historico-de-noticias/cofece-el-vencimiento-de-patentes-no-se-ha-traducido-en-suficiente-presion-competitiva-en-el-mercado.  The press statement also contains the link to download the full study.

News from Abroad -- Mexican Antitrust Authority Issues Broad Study on Generic Drug Entry into Mexican Market -- Part I

Study Suggests Several Changes to Legislation on Patents, Marketing Authorizations, and Government Procurement

By Juan Luis Serrano* --

In July of 2016, the Federal Commission for Economic Competition announced a broad ranging study on the entry of generic drug alternatives to the Mexican market, both for private purchasing and government procurement.  The results of this study were released last week, along with a press statement[1], which outlined the following main findings:

• Entry of generic drugs to the market is unduly slow.
• Patent expiration has not caused enough competition in the market.
• Entry of generic drugs has not caused enough price reductions in comparison to other jurisdictions.
• Industry regulations is affecting competition conditions.
• Some of the current rules have provide incentives for innovator companies to engage in litigation.

In this study, the Commission makes several recommendations, addressed at the Patent Office (IMPI), the Regulatory Authority (COFEPRIS), the Ministry of Health (Secretaría de Salud) and Congress, which affect different aspects of relevance to the industry, such as patent-marketing authorization linkage, limitation of grant of certain patents, regulatory data exclusivity, prescription rules, substitution/interchangeability, and government procurement rules.

Whereas each of these recommendations will be subject to specific analysis and future blog entries, we’ll start the series with a highlight of the study as a callout by the competition authority for an overhaul of the regulatory framework under which both innovator and generic companies participate in the Mexican Market.

Even though the study does not constitute a mandate for other authorities to act upon it, it does provide insight based on current official information, numbers of approvals, market penetration, and comparison with other legislations with a strong message of a need for change.

It will certainly be interesting to follow up on the fallout of this study, including possible endorsements or criticisms to its conclusions and recommendations.

* Mr. Serrano is Of Counsel with ROMO DE VIVAR V.IP SERVICES, S.C.

[1] https://www.cofece.mx/cofece/index.php/prensa/historico-de-noticias/cofece-el-vencimiento-de-patentes-no-se-ha-traducido-en-suficiente-presion-competitiva-en-el-mercado

News from Abroad -- Briefing on Supplementary Protection Certificates for Medicinal Products

What are SPCs?

A Supplementary Protection Certificate (SPC) is an intellectual property right available for active ingredients of human and veterinary medicinal products requiring marketing authorisation¹.

The highest tribunal hearing disputes involving SPCs for EU member states is the Court of Justice of the European Union (CJEU).  Historically there have been numerous referrals to the CJEU on points of law relating to SPCs and this is expected to continue.  Some of the key decisions are discussed below.

The SPC regime was introduced as a mechanism to compensate patent holders for loss in effective patent term resulting from the time taken to receive marketing authorisation for such products².  However, regulatory delay is not of itself sufficient to justify the grant of SPCs.

In particular, the relevant regulation provides that an SPC can be granted only for an "active ingredient".  This has been held to exclude substances that may enable or enhance the activity of a therapeutic ingredient, but which have no therapeutic effect of their own on the human or animal body.  Despite the clinical testing (and consequent regulatory delay) involved in developing such auxiliary substances, the CJEU has on two occasions³ held that they do not qualify for an SPC.  Similarly, it is not currently possible to obtain SPC protection for a medical device, irrespective of whether or not the marketing of such a device has been subject to regulatory delay.

Where are SPCs available?

SPCs are national rights: at present there is no such thing as a Europe-wide SPC.  Accordingly, individual applications must be made to national patent offices in countries where SPC protection is desired.

SPC protection is available in all EU member states, namely:

Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovak Republic, Slovenia, Spain, Sweden and the United Kingdom⁴.

SPCs in these countries are governed by EC Regulation 469/2009 ("the SPC Regulation" -- excerpts of which are included as Annex 1).

SPC protection is also available in the following non-EU States:

• Norway and Iceland: these States are members of the European Economic Area (EEA), but not of the EU, and the governing legislation is the EU SPC Regulation.

• Switzerland: Swiss SPCs are governed by legal provisions which are based on the EU SPC Regulation.  An SPC issued in Switzerland will also automatically take effect in Liechtenstein⁵.

• Albania, Bosnia & Herzegovina, Macedonia, and Serbia: These are non-EU/EEA countries which may nonetheless be covered by a European patent application granted by the EPO.  SPC protection is available in these countries under national legal provisions.

Similar provisions also exist in neighbouring jurisdictions including Russia and the Ukraine, and in other countries worldwide.  Those interested in rights in these jurisdictions can contact J A Kemp for more information.

What scope of protection is provided by the SPC?

The scope of an SPC is limited to the product of the relevant marketing authorisation.  It protects that product to the same extent as the patent on which the SPC is based ("the basic patent").  For example, if the basic patent covers the product per se, the SPC will also cover the product per se.  If the basic patent only covers a method of manufacturing or using the product, then the SPC will be similarly restricted.

The product of the marketing authorisation has long been established to encompass therapeutically equivalent salts and esters of small molecule drugs⁶, provided of course that they are covered by the basic patent.

The situation is less clear for active ingredients which are biological molecules.  A decision of the Norwegian Court of Appeal⁷ following an advisory opinion of the EFTA court⁸ recognised that it would be desirable for therapeutically equivalent variants of a biologic product to be covered by an SPC, but provided little guidance as to the extent of such coverage.  It is to be expected that this question will be referred to the CJEU.

Subject to the scope of the basic patent, an SPC for a given active ingredient will cover any use of that active ingredient in a drug which is authorised before the SPC expires.  Subsequent marketing authorisations made after grant of an SPC will therefore extend the scope of the SPC, even when the later marketing authorisation is obtained by an entity unconnected with the owner of the SPC.

Also, subject to the scope of the basic patent, an SPC will cover all subsequently authorised combinations of active ingredients containing the product at issue.⁹

What additional term is provided by the SPC?

An SPC takes effect at the end of the normal expiry term of the basic patent on which it is based, provided that the patent is maintained up to that point.

For EU/EEA member states, the SPC will expire at whichever is the earlier of:

• 15 years from the first Marketing Authorisation in the EU/EEA10

• 5 years from the expiry of the basic patent

The effective maximum term is therefore 5 years in addition to the term of the basic patent.

For non-EU/EEA member states, the term is determined by reference to the local marketing authorisation.  For example, the term of a Swiss SPC is determined by reference to the date of the Swiss marketing authorisation.  Since this can issue later than the EU/EEA authorisation, the Swiss SPC for a medicinal product may have a longer term than the corresponding SPCs in the EU/EEA countries.

It is possible to extend the term of an SPC by a further 6 months by providing clinical results obtained from an agreed paediatric investigation plan.  The request for extension may be filed at any time up to 2 years before normal SPC expiry.

Further information is provided in J A Kemp's briefing note on the Paediatric Products Regulation, which is available upon request.

Who should apply for the SPC?

The Applicant for the SPC must own the basic patent, but need not hold the relevant marketing authorisation.  Thus, it is possible to secure an SPC based on a marketing authorisation held by a third party¹¹.

When should the SPC application be filed?

An application for an SPC must be filed with the national Patent Office of the country concerned within the later of:

• 6 months from the date on which the first authorisation to place the product on the market is granted in that country; or

• 6 months from the date of grant of the basic patent.

If the basic patent expires before marketing authorisation is achieved, it may not be possible to secure an SPC.  Under such circumstances, it may be worthwhile filing an application for an SPC before expiry of the patent and following up with the marketing authorisation when it is available.  However, the chances of persuading Patent Offices to grant an SPC under such circumstances would at best be uncertain¹².

What are the substantive requirements for obtaining SPCs?

The requirements for grant of an SPC are set out in Article 3 of the SPC Regulation.

• Article 3(a) requires that the product be "protected" by a basic patent.

• Articles 3(b) and 3(d) require that the SPC be based on the first valid authorisation to place the product on the market as a medicinal product.

• Article 3(c) requires that the product has not already been the subject of an SPC.

Although these requirements may appear relatively simple, each has been subject to multiple referrals to the CJEU.  More detailed discussion is provided below.

What is meant by "protected" by a basic patent?

Perhaps surprisingly, to fulfill this requirement it is not sufficient that the product would hypothetically infringe the claims of the basic patent.  Unfortunately it is also not clear precisely what is sufficient.  There have been several referrals to the CJEU on this point, and it is expected that more will follow.

The leading CJEU decisions are generally considered to be the "Medeva"¹³ and "Eli Lilly"¹⁴ decisions.

In Medeva, the CJEU held that for the SPC to be granted, the active ingredient must be "specified in the wording of the claims of the basic patent".

The decision in Medeva was made in the context of SPCs for a combination therapy.  Specifically, the patent had a claim to A, which would prevent an unauthorised third party from manufacturing and selling a medicinal product containing A and another active ingredient, B.  However, this was held not to support an SPC for the product A+B because B was not specified in any way in the wording of the claim.

This has generally been interpreted to mean that a patent which claims product A and does not mention combination therapies cannot support an SPC for combinations of active ingredients containing A, e.g., an SPC for A+B ¹⁵.

A subsequent CJEU decision¹⁶ has also confirmed that a patent which claims only a combination of A+B cannot be the basic patent for an SPC for A alone, despite the fact that sale of A may well, under some circumstances, infringe the patent under "contributory infringement" provisions.  This remains true even where the marketing authorisation is for a medicine comprising A and includes an indication that A may or should be used together with B.

There has been much debate over the extent to which the reasoning in Medeva and other "combination" decisions should apply to single active ingredients.  Clearly the requirement that the active ingredient is "specified" will be satisfied if the basic patent contains a claim which specifically mentions the product at issue.  The situation is much less clear, though, when the claims of the basic patent embrace the product at without mentioning it specifically.

In Eli Lilly, the CJEU explored this question in the specific context of a functionally defined active ingredient ("…an antibody which binds to <target>…").  It was held that a functional definition can in principle support an SPC, provided that the claims when construed in the context of the description relate "implicitly but necessarily and specifically" to the active ingredient.

Although very little guidance was provided as to how to establish whether a claim meets this test, the referring UK Court¹⁷ interpreted the CJEU's intention to be that any general claim language which covers a single active agent, including a functional definition, will satisfy the requirements of Article 3(a) for an SPC directed to that active agent.  This remains the case even if there is no "individualised description" of the active ingredient elsewhere in the patent.  However, claims which embrace active ingredients only by virtue of open-ended language, such as "comprises", would not satisfy Article 3(a).

Perhaps reflecting general frustration with the lack of clarity on this issue, the UK Court has made a further referral to the CJEU¹⁸ posing a deliberately open question:

"What are the criteria for deciding whether 'the product is protected by a basic patent in force' in Article 3(a) of the SPC Regulation?"

The facts of that particular case again concern a combination product, but it is hoped that the CJEU will take the opportunity to provide guidance on Article 3(a) in general terms.  Ideally the CJEU will also clarify other outstanding matters relating to Article 3(a), such as whether the claims of a basic patent can be amended after grant to cure a deficiency under Article 3(a).  This question has also been put to the CJEU in a previous referral¹⁹ but they declined to answer.

What is meant by "a valid authorisation to place the product on the market as a medicinal product"?

The CJEU has confirmed that an SPC for a given product should be based on the first authorisation for a drug containing the product even if this is a combination therapy which includes the product.  Thus, for example, an SPC for product A can be based on a patent claiming A and a marketing authorisation for a medicinal product containing A+B.²⁰  This may be important for vaccine products, where marketing authorisations often relate to combinations of multiple active ingredients.  An SPC granted under such circumstances will cover all products containing product A approved before the SPC expires.

How many SPCs may be granted for a given product or patent?

Although Article 3(c) of the SPC Regulation suggests that only one SPC can be granted for a given product, it has long been the case that if two basic patents are owned by different Patentees, each Patentee can secure an SPC.  Under such circumstances, both SPCs can be based on the same marketing authorisation.

If two patents which cover a given product are held by a single Patentee, only one SPC is available.  The Patentee must choose which patent to use to support the SPC.  Considerations which may apply when determining which patent to choose will include the relative vulnerability of the patents to any validity challenge and the duration of the SPC available from each patent.  If, however, the two patents are held by different entities, each patent can support a separate SPC.

In general, it is also possible to have multiple SPCs granted for multiple different products on the basis of the same basic patent, provided that each product is protected by the basic patent²¹.

An exception to this principle has however been set out by the CJEU in two cases²², both of which relate to a scenario in which an SPC has already been granted for a single active ingredient A, and a later application is filed for an SPC for a combination containing that active ingredient, A+B.  The CJEU has held that the later SPC should not be granted in these circumstances.

However, the reasoning of the CJEU in both cases appears to have been influenced by a finding that the single active ingredient was the "sole" or "core" of the invention underlying the basic patent, and so they were reluctant to award a further SPC for the combination.  It is unclear whether the exception would also apply if the combination represented a separate inventive advance disclosed within the same patent, or indeed if the combination had been presented in a separate patent.

Which Marketing Authorisation is the first Marketing Authorisation?

Article 3(d) of the SPC Regulation requires that an SPC be based on the first authorisation to place a drug on the market as a medicinal product (the earliest marketing authorisation).  The proper identification of the earliest marketing authorisation may be an issue when a patent protecting a second or subsequent medical use of a particular drug is used as the basis for an SPC application.

Historically it had been thought that a patent to a new medical use of a drug could form the basis of an SPC, but that SPC had to be based on the earliest marketing authorisation for that drug, even if the earliest authorisation was for a different disease or condition from that specified in the patent.²³  In practice, reference to the earliest marketing authorisation often meant that any resultant SPC would have a zero term, because of the maximum SPC term of 15 years from first marketing authorisation in the EU.

However, in the landmark "Neurim" decision²⁴, the CJEU indicated that under certain circumstances it is possible to base an SPC application on an authorisation which is not the first marketing authorisation to place a particular drug on the market.

The facts in Neurim were that an earlier authorisation had been issued for a veterinary use.  The CJEU held that this should not preclude grant of an SPC based on a later authorisation for a completely separate human use.  However, the phrasing used by the CJEU was more general, stating that the "first" authorisation for the purposes of Article 3(d) is the "first" authorisation "which comes within the limits of the protection conferred by the basic patent".  That is, an earlier authorisation which is outside the scope of the basic patent should not be taken into account.

There has been much debate over how broadly the principles outlined in Neurim should be applied, with the various national patent offices diverging to a significant extent.  For example, some offices apply Neurim very narrowly, such that the SPC will only be granted if the earlier authorisation is veterinary and the later authorisation is for a different indication in humans.  Many offices apply a broader interpretation, such that the SPC is granted provided the later authorisation is for any different indication.  However, some offices apply Neurim very broadly, such that an SPC may be granted if the later authorisation differs from the earlier in any way, including e.g., the formulation of the active ingredient, the administration or dosage regime, or the specific patient population to be treated.

Perhaps unsurprisingly therefore, this point is the subject of yet another CJEU referral²⁵.  The UK Court has specifically requested clarification as to whether Neurim may apply if the later authorisation is for a new formulation of a previously authorised active ingredient.

In the meantime, however, it may be possible for Patentees to obtain SPCs on the basis of:

a) a patent to a downstream development of a known drug, for example a patent for a new medical use or a new formulation of a known active ingredient; and

b) a second or subsequent marketing authorisation for a medicinal product containing the active ingredient at issue.

Such SPCs may be granted if:

(i) the downstream patent does not cover the medicinal product specified in the original marketing authorisation; and

(ii) the second or subsequent marketing authorisation is the first authorisation for a medicinal product which is protected by the downstream patent.

Further information on SPCs based on patents for downstream developments of a known drug can be found in J A Kemp's briefing on the Neurim decision, which is available upon request.

Is it possible for a third party to challenge the grant of the SPC?

Even where there is no formal mechanism to do so, most national patent offices will consider observations filed by a third party against an application for an SPC.  Such observations may draw the Examiner's attention to deficiencies in the application with respect to compliance with the substantive requirements of the SPC Regulation.

Such observations may slow (or even prevent) grant of the SPC application.  After grant, the validity of an SPC may be challenged in the national courts on the same grounds.

The validity of the basic patent underlying an SPC may of course also be challenged separately via all normal routes (EPO opposition, national revocation action etc.).  Should the patent be revoked, any SPC or SPC application based upon it is automatically invalidated.

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¹ SPCs are also available for active substances in plant protection products, but these are not the focus of this briefing.

² The purpose is thus similar to Patent Term Extensions (PTE) available in, e.g., USA and Japan, but unlike those systems an SPC is not an extension of a patent, it is a separate right.

³ C-431/04 MIT (a bioerodible matrix) & C-210/13 Glaxosmithkline (an adjuvant in a vaccine).

⁴ The UK is expected to implement a corresponding national provision even in the event of a 'hard' Brexit, and thus SPCs should remain available in the UK.

⁵ Swiss marketing authorisations also automatically take effect in Liechtenstein, which unlike Switzerland is an EEA member.  Thus, this must be taken into account when determining the first authorisation in the EU/EEA.  See comments on additional term provided by an SPC below.

⁶ C-392/97 Farmitalia.

⁷ Pharmaq v Intervet 15-170539ASD-BORG/01.

⁸ Similar status to the CJEU for matters referred by the national courts of the EEA states: Norway, Iceland, Liechtenstein.

⁹ C-322/10 Medeva, C-422/10 Georgetown and C442/11 Novartis v. Actavis.

¹⁰ The CJEU confirmed in C-471/14 that the relevant date of an EU Marketing Authorisation is the date on which notification of the authorisation is made to the holder (typically a few days later than the Commission Decision granting the authorisation).  This may result in extra days of SPC term, although some national patent offices have yet to correct the term of SPCs granted prior to the CJEU decision.  A further referral (C-492/169) from the Hungarian Courts asks whether such correction is required.  A hearing date has not yet been set.

¹¹ C-181/95 Biogen V SKB explicitly endorsed this view.

¹² A pending CJEU referral (C-567/16) asks the specific questions whether an "end of procedure" notice (indicates an MA is imminent) is sufficient to support an SPC and, if not, whether the absence of a full MA can be remedied later.  A hearing date has not yet been set.

¹³ C-322/10.

¹⁴ C-493/12.

¹⁵ [2012] EWCA Civ 523 Medeva BV v Comptroller General of Patents.

¹⁶ C-518/10 Yeda.

¹⁷ [2014] EWHC 2404 (Pat) Eli Lilly.

¹⁸ C-121/17 Teva v Gilead – hearing date not yet set.  Request for expedition was refused in April 2017.

¹⁹ C-577/13 Actavis v Boehringer.

²⁰ C-322/10 Medeva and C-422/10 Georgetown.

²¹ C-484/12 Georgetown.

²² C-443/12 Actavis v Sanofi, C-577/13 Actavis v Boehringer.

²³ C-202/05 Yissum.

²⁴ C-130/11 Neurim.

²⁵ C-tbc Abraxis Bioscience – hearing date not yet set.

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Annex 1

Regulation (EC) No 469/2009 of the European Parliament and of the Council of 6 May 2009 (selected provisions)

Article 1

Definitions

For the purposes of this Regulation, the following definitions shall apply:

(a)    'medicinal product' means any substance or combination of substances presented for treating or preventing disease in human beings or animals and any substance or combination of substances which may be administered to human beings or animals with a view to making a medical diagnosis or to restoring, correcting or modifying physiological functions in humans or in animals;

(b)    'product' means the active ingredient or combination of active ingredients of a medicinal product; […]

Article 2

Scope

Any product protected by a patent in the territory of a Member State and subject, prior to being placed on the market as a medicinal product, to an administrative authorisation procedure as laid down in Directive 2001/83/EC of the European Parliament and of the Council of 6 November 2001 on the Community code relating to medicinal products for human use or Directive 2001/82/EC of the European Parliament and of the Council of 6 November 2001 on the Community code relating to veterinary medicinal products may, under the terms and conditions provided for in this Regulation, be the subject of a certificate.

Article 3

Conditions for Obtaining a Certificate

A certificate shall be granted if, in the Member State in which the application referred to in Article 7 is submitted and at the date of that application:

(a)    the product is protected by a basic patent in force;

(b)    a valid authorisation to place the product on the market as a medicinal product has been granted in accordance with Directive 2001/83/EC or Directive 2001/82/EC, as appropriate;

(c)    the product has not already been the subject of a certificate;

(d)    the authorisation referred to in point (b) is the first authorization to place the product on the market as a medicinal

Article 4

Subject matter of protection

Within the limits of the protection conferred by the basic patent, the protection conferred by a certificate shall extend only to the product covered by the authorisation to place the corresponding medicinal product on the market and for any use of the product as a medicinal product that has been authorised before the expiry of the certificate.

Article 5

Effects of the certificate

Subject to the provisions of Article 4, the certificate shall confer the same rights as conferred by the basic patent and shall be subject to the same limitations and the same obligations.

[…]


This article was reprinted with permission from J A Kemp.

News from Abroad -- EPO Applies Doctrine of Plausibility to Small Molecule Pharmaceuticals

In Decision T 488/16, the Boards of Appeal of the European Patent Office (BoA) have revoked EP 1 169 038, which protected the blockbuster protein tyrosine kinase (PTK) inhibitor dasatinib (Sprycel^®).  The only request on file -- a single claim directed to dasatinib per se or a salt thereof -- was found to lack inventive step in view of the absence of evidence in the application as filed (and the common general knowledge) which rendered the activity of dasatinib in inhibiting PTK "plausible".  A general statement in the application as filed that "Compounds described in the following Examples have been tested in one or more of these assays, and have shown activity" was not by itself considered enough to render it credible to the skilled person that the described compounds were PTK inhibitors.  In the absence of a plausible disclosure of activity against PTK in the specification as filed, the objective technical problem was defined by the Board of Appeal as merely "the provision of a further chemical compound".  The extensive clinical data which became available after the filing date of the patent evidencing biological activity was not taken into account when determining inventive step.

The Boards of Appeal of the European Patent Office have for many years imposed a requirement that claims for large molecules (e.g., proteins) must be supported by a plausible disclosure of biological activity in the application as filed (see, for example, T 1329/04).  A similar requirement for a plausible disclosure of activity in the original specification has also been required to support medical use claims (see, for example, T 0609/02).  However, this Decision indicates that the Boards are willing to apply the same strict standards when assessing claims for small molecule drugs per se.

This article was reprinted with permission from J A Kemp.

News from Abroad -- Lilly v Actavis -- Supreme Court Introduces a Doctrine of Equivalents in the UK

The UK Supreme Court's judgment in Lilly v Actavis has profound implications for the scope of protection provided by patent claims in the UK.

The judgment moves away from the principle that the patentee should enjoy the full extent, but no more than the full extent, of the monopoly that a reasonable person skilled in the art, reading the claims in context, would think he was intending to claim.  Rather, following this new decision, a patent claim in the UK can be infringed by products or processes that are not within the ambit of the language used in the claims.

Legal background

The legislative provisions governing the scope of protection conferred by a patent in the UK are governed, as in the other EPC States, by Article 69 EPC and the Protocol thereto.  The text of Article 69 EPC and its Protocol are set out in the Annex.

Article 2 of the Protocol requires that "due account" must be taken of any element that is "equivalent" to an element specified in the claims.  However, the UK courts have long been reluctant to recognise a doctrine of equivalents, in the sense that a claim should protect subject matter that is different from, but equivalent to, that specified in the claim.  Rather, the courts have applied a doctrine of "purposive construction", in which they seek to determine what the person skilled in the art would have understood the patentee to be using the language of the claim to mean.

The leading case explaining this approach of purposive construction was House of Lords case Kirin-Amgen v TKT[1].  That case involved a claim for recombinant erythropoietin, prepared in a eukaryotic host cell.

In Kirin-Amgen v TKT, the court noted that other jurisdictions, such as the United States, did apply a doctrine of equivalents, but opined that such a doctrine was "born of despair" and that the correct approach was simply to assess what the person skilled in the art would have understood the patentee to be claiming.  On the facts of the case, the court held that a skilled person would understand a "host cell" to be a cell that is host to a foreign DNA sequence that encodes erythropoietin or an erythropoietin analogue.  TKT's product was not prepared via such a cell, and therefore did not infringe.

Facts and history of the present case

The claims of Lilly's patent related to the use of the disodium salt of pemetrexed in the manufacture of a medicament for use in combination with vitamin B12 for the treatment of cancer.  A corresponding medicament including pemetrexed disodium and the vitamin (Alimta®) had been successfully marketed by Lilly since 2004.  In order to clear the way for marketing of competing products, Actavis applied for declarations of non-infringement in relation to various pemetrexed products comprising the diacid (non-salt) form of pemetrexed or alternative salt forms to disodium (such as dipotassium).

Actavis' position was that their products should not infringe directly because in no sensible way could pemetrexed dipotassium (for example) be said to fall within the expression "pemetrexed disodium" as recited in claim 1 of the patent.  Given the background outlined above, and following Amgen v TKT, Actavis could reasonably have expected the courts to take the view that there was no direct infringement of Lilly's patent, and indeed the first instance court and the Court of Appeal did just that.  In the UK it is, though, possible to ask the Supreme Court to hear an appeal from a ruling from the English Court of Appeal on a point of law of general public importance, and in this instance the Supreme Court agreed to hear such an appeal.

Direct infringement

On appeal, the Supreme Court recognised that the expression "pemetrexed disodium" set out in claim 1 of the patent could not in any sensible way be interpreted so as to cover, for example, pemetrexed dipotassium.  However, contrary to the reasoning in Amgen v TKT, the court then held that this should not be the definitive question for determining infringement.  Rather, Lord Neuberger, who gave judgment for the court, ruled that a variant that is not covered by the claims as a matter of normal interpretation could nevertheless infringe if it varies from the claimed invention only in an immaterial way.

In reaching this conclusion, the judge noted that Article 2 of the Protocol to Article 69 EPC makes it clear that there is potentially a difference between the interpretation of a claim and the extent of protection conferred by the claim and that, when assessing that difference, equivalents must be taken into account.  He also reviewed relevant case law in other EPC states (Germany, France, Italy, Spain, and the Netherlands), and noted that many of these states already apply a doctrine of equivalents.

A new three-part test for determining whether a variant outside the normal meaning of the claims can infringe was then set out.  The three questions to be answered are:

1.  Notwithstanding that it is not within the literal meaning of the relevant claim(s) of the patent, does the variant achieve substantially the same result in substantially the same way as the invention, i.e. the inventive concept revealed by the patent?

2.  Would it be obvious to the person skilled in the art, reading the patent at the priority date, but knowing that the variant achieves substantially the same effect as the invention, that it does so in substantially the same way as the invention?

3.  Would such a reader of the patent have concluded that the patentee nonetheless intended that strict compliance with the literal meaning of the relevant claim(s) of the patent was an essential requirement of the invention?

It is noteworthy that the first question refers to the "inventive concept revealed by the patent".  The judge did not explain in detail what is meant by the "inventive concept".  He viewed it as requiring consideration of how the invention works, and equated it to terms he identified from other EPC jurisdictions, including a consideration of "the problem underlying the invention" and "the inventive core".  Presumably, identification of the "inventive concept" should involve an assessment of the features central to distinguishing the invention over the prior art.

The second question requires an assessment of whether at the priority date of the patent it would be obvious that the variant achieves substantially the same result in substantially the same way as the invention.  The judge held that it was important that the knowledge that the variant exists, and that it achieves substantially the same effect, must be ascribed to the skilled person before the question is asked.  It follows that it is possible to have an affirmative answer to the second question even where the variant was unforeseeable at the priority date.

As regards the third question, the judge clarified that the relevant issue is whether or not the feature at issue is essential to the "invention", not whether or not it is essential to the product or process of which the inventive concept is part.  For example, a distinction can be drawn between features that contribute to the inventive concept and conventional features that are merely essential to the operation of a particular product or process that embodies the inventive concept (e.g., a conventional wheel might be an essential component of a new and inventive bicycle, but not essential to the corresponding "invention").

The judge further held that the third question should be considered in the light of the specification as a whole and the knowledge and expertise of the skilled person.  He also pointed out that the fact that the language of the claim excludes the variant on any sensible reading is not enough to justify the answer "yes".  Finally, he emphasised that it is necessary to imbue the skilled person with the knowledge of the variant and the fact that it achieves substantially the same effect as the claimed invention when assessing the third question.

Application of the test

On the facts of the case, the first question was answered positively on the basis that all of Actavis' products worked in the same way as the invention, involving a medicament that is a combination of pemetrexed and vitamin B12.  The judge defined the inventive concept of the patent as the manufacture of a medicament which enables the pemetrexed anion to be administered with vitamin B12.

The second question was also answered affirmatively since it was held that it would be appreciated at the priority date that the Actavis products would work in the same way as pemetrexed disodium when administered with vitamin B12.  Earlier findings of fact had been made in the first instance Patents Court judgment to the effect that the preparation of other suitable salt forms of a given molecule would not be a predictable exercise.  However, the second question presupposes knowledge that the particular variants in question are indeed functional, i.e., they achieve substantially the same result as the invention.

Finally, the third question was answered in the negative on the basis that the specification did not teach any essentiality to the disodium salt of pemetrexed, but rather contained a more general disclosure of antifolates and their administration with vitamin B12.  Also, there was a finding that the skilled person would know, as a matter of common general knowledge, that different salt forms may be used and screened for routinely in drug development.  The fact that the particular specific disclosure of the patent and its examples related only to pemetrexed disodium did not justify, in the view of the judge, the conclusion that the patentee intended to limit the scope of protection of the granted patent to this salt form only.  In this regard, the judge drew a clear contrast between the disclosure of the specification of a patent and the scope of protection provided by the claims.

The judge thus concluded that, subject to a consideration of the prosecution history, the Actavis products infringe claim 1 of the patent.

Consideration of prosecution history

The judge generally held that contents of a prosecution file should be treated with some scepticism.  However, he held that a reference to the file would be appropriate if:

(i)     the point at issue is truly unclear if one confines oneself to the description and claims of the patent, and the contents of the file unambiguously resolve the point; or

(ii)    it would be contrary to the public interest for the contents of the file to be ignored.

An example of a situation arising under (ii) may, for example, be where a statement had been clearly made by the patentee that the scope of the claims do not extend to the relevant variant now claimed to be infringing.

The review of Lilly's prosecution of the application at the European Patent Office established that limitations had been made to original broader claims relating to antifolates generally, in response to objections of lack of disclosure (Article 83 EPC) and lack of clarity (Article 84 EPC).  A claim to pemetrexed generally had then been further limited to pemetrexed disodium on the basis of an objection of added subject matter (Article 123(2) EPC).

The judge noted that these limitations had been made to address objections based on the disclosure of the patent, and held that they were not relevant to the question of whether pemetrexed salts other than disodium should be within the scope of the patent pursuant to a doctrine of equivalents.  It is possible, of course, that a different conclusion would have been reached if the limitations had been necessary to distinguish the claimed invention from prior art cited by the Patent Office Examiner.

For the reasons given above, all of Actavis' products were held directly to infringe Lilly's patent, as being immaterial variants of the claimed invention.

Other infringement findings

Given the findings on direct infringement, the debate on indirect infringement became moot.  However, Actavis were also held to be liable under Section 60(2) of the UK Patents Act as supplying means essential for putting the invention into effect, on the basis that the Actavis products would inevitably be dissolved in saline, which would lead to a dissolved sodium salt of pemetrexed.

Findings of infringement were also made for Actavis' products under French, Italian, and Spanish law based on the original application made for the UK court to determine infringement in these jurisdictions, and applying the doctrine of equivalents provisions that exist in these EPC states.

Comment

The Supreme Court's judgment significantly changes previous UK practice for assessing infringement.  It has the effect of bringing UK law more in line with other European countries and so may be viewed as a nod towards the Unitary Patent system in which a more harmonised approach to infringement will be required.

Given this development in the law in the UK, it may be appropriate for both patentees and those seeking to develop new products and processes to review any advice they have previously received on infringement, based on the previous Amgen v TKT precedent.  It may be that a different conclusion could be reached on the same facts following this new judgment.

When drafting and prosecuting patent applications, it may now be more important to include disclosure in the specification relating to the nature of the invention that is framed at a general level.  This can then be used for assessing the inventive concept.  It also remains important to avoid unnecessary suggestions that particular features are essential to the working of the invention.

If you would like to discuss the impact of this decision on any specific situation you face, please do not hesitate to contact your usual J A Kemp contact.

 

ANNEX

Article 69(1) EPC and Protocol Thereto

Article 69(1) EPC:

The extent of the protection conferred by a European patent or a European patent application shall be determined by the terms of the claims.  Nevertheless, the description and drawings shall be used to interpret the claims.

Protocol:

Article 1: General principles

Article 69 should not be interpreted in the sense that the extent of the protection conferred by a European patent is to be understood as that defined by the strict, literal meaning of the wording used in the claims, the description and drawings being employed only for the purpose of resolving an ambiguity found in the claims.  Neither should it be interpreted in the sense that the claims serve only as a guideline and that the actual protection conferred may extend to what, from a consideration of the description and drawings by a person skilled in the art, the patentee has contemplated.  On the contrary, it is to be interpreted as defining a position between these extremes which combines a fair protection for the patentee with a reasonable degree of certainty for third parties.

Article 2: Equivalents

For the purpose of determining the extent of protection conferred by a European patent, due account shall be taken of any element which is equivalent to an element specified in the claims.

[1] Kirin Amgen v Hoechst Marion Roussel [2004] UKHL 46 ([2005] RPC 169).  The judicial function of the House of Lords was succeeded by the Supreme Court in 2009.

This article was reprinted with permission from J A Kemp.

News from Abroad -- UK Progress on Unitary Patent (UP) and Unified Patent Court (UPC)

The UK has become the ninth state to deposit the document required to apply the Protocol on Provisional Application (PPA), which is an essential step towards formation of the UPC.  Four more deposits, including that of Germany, are required for the PPA to come into force, which will allow the UPC to gain legal personality and start the process of selecting Judges and formally to adopt the Rules of Procedure.  The UK Government has also laid secondary legislation before Parliament which will enable UK Ratification, foreseen in autumn 2017.

Should the UK Ratification process proceed as expected, the final major obstacle to the UP and UPC coming into force is the constitutional challenge to German ratification.  It is understood that the application for interim relief in Germany which led to the German Constitutional Court asking the German Federal President not to ratify the UPC, is likely to be heard in autumn 2017, meaning that the PPA could come into force before the end of 2017, with the sunrise period starting in early 2018.

This article was reprinted with permission from J A Kemp.

News from Abroad -- EPO Lifts Stays of Proceedings Following Implementation of New Plant Patent-Eligibility Rules

On 3 July, the European Patent Office (EPO) lifted its stays of proceedings on cases that had been held in abeyance pending new rules on the patent-eligibility of plant-related subject matter.  Following an intervention by the European Commission in November 2016, as of December 2016 the EPO had stayed the prosecution of a number of plant-related applications pending a possible rule change.  The EPO's Administrative Council then decided at the end of June 2017 to enact some new EPC Rules in this area.  These became effective almost immediately, as of 1 July 2017 and are applicable to both existing and newly filed applications.

The main change is the addition of new Rule 28(2) EPC, which reads as follows:

Under Article 53(b), European patents shall not be granted in respect of plants or animals exclusively obtained by means of an essentially biological process.

Article 53(b) EPC provides that patents cannot be granted for plant or animal varieties or essentially biological processes for the production of plants or animals.  The interpretation of these provisions has been controversial for some two decades.  The latest area of dispute has been around whether, in light of the exclusion of essentially biological processes, it is nevertheless possible to patent the products of those processes, e.g., to patent "classically" bred plants even though not the breeding processes by which they are created.  Some European countries' national laws already contain provisions to the effect that the products of essentially biological processes are not patentable, even though the EPC refers only to the processes themselves.  In its so-called Broccoli/Tomatoes I decisions in 2010, the EPO's Enlarged Board of Appeal held that, in essence, any process claim containing one or more breeding steps was patent-ineligible under Article 53(b) but then in further decisions known as Broccoli/Tomatoes II, it held in 2015 that the products of such processes could be patented.  In fact, prosecution of such applications tended to be very difficult for other reasons, so few such patents were granted, but improvements in technology, especially growth in the availability of molecular marker data, that gave applicants more information about their plants and allowed better definition of traits contained in them have recently been beginning to render such filings more realistic.  In the meantime, however, political pressure from breeders' groups, non-governmental organisations, and continental European governments opposed to such patents led the EU to lobby the EPO and the EPO to change its Rules.

New Rule 28(2) is prima facie in conflict with the Broccoli/Tomatoes II decision so it remains to be seen how this will be play out when the EPO begins to apply it.  In principle, Article 23 EPC means that the EPO's Boards of Appeal have to follow only the EPC itself, not its Rules, so if the Boards feel that the Rules are not in line with the EPC, they can ignore them.  However, day-to-day examination will of course be conducted in line with the Rules so it seems likely that applications will be refused and test cases filed with the Boards of Appeal, leading ultimately to a further Enlarged Board of Appeal decision on the topic in the next few years.  If the Enlarged Board ultimately re-confirms its existing case law, this will create a conflict in that the EPO will be forced to grant patents that may be unenforceable in litigation in many EPC member states, i.e., all those that are members of the European Union.  This situation however exists to an extent already because of the national laws that are drafted differently than the EPC.  The position of non-EU states that are members of the EPC is interesting in this regard, as those countries will more easily be able to reach their own decisions and may be more swayed by EPO case law than EU opinion.  It is for example possible that UK practice on this issue could diverge when the UK leaves the EU.  However, it is equally possible that the UK could enact a rule change similar to the one that introduced Rule 28(2) EPC.

All of this is however for the future.  In the meantime, examination of the stayed cases will now resume and the new rules will also be applied to newly filed cases.  Exactly how they will be applied will only become clear with time and experience but, from guidance published by the EPO before the changes were made, it appears that practice will remain similar in some ways and toughen in others.  The use of the word "exclusively" in new Rule 28(2) suggests that plants and animals that are obtained partly by breeding and partly by technical means such as transformation and mutagenesis (including gene-editing techniques such as CRISPR/Cas) should still be patent-eligible as long as the claims are not confined to individual plant varieties, which are excluded by the other limb of Art 53(b) EPC.  Claims to transgenic and mutant plants are thus unlikely to be affected, and new Rule 28(2) also does not change the position on claims in process format, on which the main authority remains Broccoli/Tomatoes I.

However, the rule change is likely problematic for so-called "native trait" claims in which the invention lies in the identification and definition of a beneficial characteristic and its transfer into other genetic backgrounds by breeding because, even when such traits are well-understood and defined in terms of sequences or marker positions, the plants themselves are still obtained by breeding processes.  The EPO has in particular opined that claims to plants produced by marker-aided selection processes, in which breeding is accelerated by reliance on molecular markers but still fundamentally composed of crossing and selection steps, should not be patent-eligible under new Rule 28(2) EPC.  Such subject matter could already not be claimed in process format because of the Broccoli/Tomatoes I decisions but this is a significant step away from the position in the Broccoli II decision, where the Enlarged Board of Appeal specifically approved claims relating to subject matter of this type in product-by-process format.  The growing introduction into national infringement laws (including that relating to the forthcoming EU unitary patent) of so-called breeder's exemptions, which have somewhat differing scopes but in general provide that it is not an infringement to breed a new variety from a patented plant, further tends to weaken patentees' positions in this regard.

Patent applicants in this field therefore continue to face uncertainty but in general may need to recognise that some options previously available to them have been closed down and other strategies will have to be developed for protection of their inventions in Europe.

This article was reprinted with permission from J A Kemp.

News from Abroad -- German Constitutional Court Holds up German Ratification of Unitary Patent Court Agreement

It was reported yesterday that the German Constitutional Court has asked the German Federal President not to ratify the Unified Patent Court Agreement (UPCA) for the time being.  The request is the result of a complaint (Az.:2BvR 739/17) made to the Constitutional Court by an unnamed person.  Details of the complaint are somewhat unclear at present, but the Court is reported to consider the complaint "not wholly without merit" ("nicht von vorneherein aussichtslos").

In order for the UPCA to come into force, ratification by both Germany and the UK is still required.  The preparatory committee of the UPC has already confirmed that the preliminary timetable set out in March is no longer achievable and that the UPC will not begin to operate before the end of 2017.  This latest setback will likely delay the coming into force of the UPCA yet further, probably at least until spring 2018.

This article was reprinted with permission from J A Kemp.

Image of Bundesverfassungsgericht, Karlsruhe (Federal Constitutional Court in Karlsruhe, Germany) by Tobias Helfrich, from the Wikipedia Commons under the Creative Commons Attribution-Share Alike 3.0 Unported license.

News from Abroad -- Swiss-style Patent Claims Can Be Very Valuable in Australia

By James Cherry* & Adam Denley** --

The scope for enforcement of Swiss-style claims may be broader in Australia than for method of medical treatment claims.  Second medical use inventions can be claimed in an ever increasing number of claim formats depending on the jurisdiction.  While such inventions in Europe are now claimed in purpose-limited-product format, or so called 'EPC2000' format, and in the U.S. are pursued in method of medical treatment format, the humble Swiss-style claim has been again shown to be of immense value in Australia even though methods of treatment claims are also an allowable format.  So much so, that an injunction against a competitor was granted solely on the basis of infringement of Swiss-style claims.

How did this occur?

The basic legal test is that the exclusive patent rights conferred on a patentee in Australia includes the right to offer an invention for sale.  Should a patentee have a product or composition of matter claim then an offer by a third party of a product which falls within the scope of that granted claim will, or course, be an infringement.  However, it is less clear what conduct infringes a patent for a second, or subsequent, medical use invention.

In the recent pregabalin court case¹ it was held that for method of medical treatment claims, an offer to sell a product referred to in those method claims cannot be an infringement as infringement requires the actual method of treatment to be performed.  Australia does have statutory contributory infringement provisions which are enlivened where the supply of a product occurs and the use of that product by a person would be an infringement.  However, these contributory infringement provisions were found not to apply where a third party merely offers to supply a product, but does not in fact supply that product.

This then leaves the often forgotten Swiss-style claim which arose in Europe to circumvent the exclusion of methods of medical treatment as patentable subject matter.  This claim format, "Use of substance X in the manufacture of a medicament for the treatment of condition Y", is often overshadowed by method of treatment format as it avoids claiming the medical treatment in a rather unusual way by claiming the manufacture but obtaining novelty and inventiveness from the condition to be treated.  The injunction granted in the pregabalin case was on the basis that it was an infringement of a Swiss-style claim to offer to supply a pharmaceutical product that results from the use of a method of manufacture the subject of the granted Swiss-style claims.  This clearly highlighted a benefit of the granted Swiss-style claims that was not afforded by the granted method of medical treatment claims.

Australian courts have confirmed that Swiss-style claims have different scope than method of medical treatment claims (see our previous article here), and this pregabalin decision shows that the scope for enforcement of Swiss-style claims is also different and perhaps broader.

¹ Apotex Pty Ltd v Warner-Lambert Company LLC (No 3) [2017] FCA 94.

* Mr. Cherry is a Principal with and the Managing Director of FPA Patent Attorneys.
** Dr. Denley is an Associate Principal with FPA Patent Attorneys.

This article was reprinted with permission from FPA Patent Attorneys.

News from Abroad -- Does an SPC for a Biological Product Cover a Biosimilar? Guidance from Norway

In December 2016, the Norwegian Court of Appeal handed down its decision in Pharmaq v Intervet^[1], which concerns the validity of Intervet's SPC for a viral vaccine for preventing pancreatic disease (PD) in salmonid fish.  Followers of SPC case law will be aware that questions relating to this case have previously been considered by the EFTA Court^[2], having been referred by the Oslo District Court.  The advisory opinion of the EFTA Court was subsequently interpreted by the District Court who found in favour of Intervet^[3].  The recent decision concerns Pharmaq's appeal.

The case is of general interest in that it relates to the extent to which an SPC for a biological product may be considered to encompass closely-related alternatives such as biosimilars.  The guidance of the EFTA court was that an SPC is invalid due to non-compliance with Article 4 of the SPC Regulation^[4], to the extent that it has been granted with a wider scope than that set out in the relevant Marketing Authorisation (MA).  However, the EFTA Court also proposed that an SPC for a viral vaccine could extend to cover a specific strain of virus encompassed by the claims of the patent but not mentioned in the MA, provided said strain constitutes the "same active ingredient" as the authorised product, and has therapeutic effects within the same indications for which the MA was granted.

Applying this guidance, the Oslo District Court had found in a majority decision that the competing products of Pharmaq and Intervet did constitute the "same active ingredient", thus holding in favour of Intervet.  However, reconsidering the EFTA Court's guidance in the light of new evidence before it, the Norwegian Court of Appeal has now overturned that earlier decision.

Claim 1 of Intervet's patent explicitly recited the deposited virus strain (of type SAV-1) that was used in its own vaccine.  However, the claim referred also to "closely-related strains which share similar genotypic or phenotypic characteristics".  In proceedings relating to the patent, the virus strain (of type SAV-3) used in Pharmaq's competing product was found to infringe the claim by virtue of this "closely-related" feature.  Intervet's MA specifically describes the deposited strain used in its own product.  Nonetheless, when applying for an SPC from the Norwegian Patent Office, Intervet stipulated a definition of the product which precisely mirrored the wording of claim 1 of the patent, thus including the reference to "closely-related strains".

The Norwegian Patent Office was evidently concerned that this product definition was broader than that provided by the MA, and thus problematic under Article 4 of the SPC Regulation.  There is some suggestion that the examiner's preference would have been to limit to closely-related strains of the SAV-1 type, but he found no basis for this interpretation in the patent.  Therefore, recognising a legitimate concern that an SPC limited solely to the deposited strain could be easily circumvented, the Office awarded Intervet the benefit of the doubt -- in the knowledge that Pharmaq were bringing a legal challenge to the SPC and that the question would ultimately be decided in the courts.

The proceedings before the Court of Appeal spent a considerable amount of effort interpreting the EFTA Court's guidance, and the extent to which Intervet's and Pharmaq's products might be considered to constitute the same active ingredient.  As part of their argumentation, Intervet relied upon the decision of the CJEU in Farmitalia^[5].  This long-standing decision established that where a patent claims a chemical compound and the marketing authorisation specifies a particular salt, the SPC is interpreted to cover alternative salts and esters of the same compound, which are in principle therapeutically equivalent.  It has been argued (including by Intervet) that similar reasoning should apply for closely-related biological products in order for the purpose of the SPC Regulation to be met.

The Norwegian Court of Appeal recognised the importance of Farmitalia in establishing that the purpose of the SPC Regulation would not be satisfied if therapeutically equivalent salts and esters were not covered by an SPC for a small chemical entity.  They also recognised the desirability of establishing a corresponding definition for biological medicinal products which, in line with Farmitalia, prevents third parties from escaping the scope of an SPC by making only minor changes to an active ingredient that otherwise remains therapeutically equivalent.  However, they noted that Farmitalia provides limited guidance for biological products (unsurprisingly given the age of that decision) and the Court was concerned also to balance the scope of protection of SPCs for such products against the other objectives of the SPC regulation.  In particular, the aim that improved medicinal products should not be kept off the market to the detriment of human or veterinary health.  Much of the Norwegian Court of Appeal's decision is thus spent grappling with these conflicting pressures.

They found what they considered to be helpful guidance in a 2009 judgment of the Dutch Appellate Court submitted by Pharmaq,  referred to as the "Yeda judgment" (2000809060/1/H3).  In that judgment, the Dutch Court upheld the decision of the Dutch Patent Office to grant an SPC only in respect of the specific active ingredient Adalimumab (a monoclonal antibody) mentioned in the relevant MA, despite the patent claims encompassing other antibodies specific for the same target.  Yeda had argued that the other antibodies would be expected to have the same therapeutic effect as Adalimumab, and pointed to Farmitalia as supporting grant of an SPC with a broader product definition.  The Dutch Court found that it was not proven that other antibodies would have the same therapeutic effect, and furthermore that even closely related biological medical products are qualitatively different to salts and esters of a chemical product.  The Dutch Court noted that even minor differences in a biological product could be significant for the quality, safety, and efficacy of the said product.

The Norwegian Court of Appeal adopted much of the same reasoning, stating that for there to be a different active ingredient, the difference between two products must be expressed such that there is a practical and appreciable effect on the quality, safety, and efficacy of the medicine in question.  Intervet argued that any such difference must be systematic, consistent and significant in order for two products to be found different.  The Court expressed some doubt that a "significant" standard was too high a threshold, but did not need to consider this further since, on the evidence before it, they found that Pharmaq's product was systematically, consistently and significantly more efficacious against SAV-3 infection than Intervet's product.

Having reached this conclusion, the Norwegian Court of Appeal decided that Intervet's SPC was invalid for lack of compliance with Article 4 of the SPC Regulation.  The Court noted that this is not a ground for invalidity under Article 15 of the SPC Regulation, and thus was obliged to define Article 15 as "not exhaustive" in order to make their decision.  Interestingly, the Court also felt that they had no legal basis to amend the SPC to provide a compliant product definition, even though the guidance from the EFTA Court appeared to suggest such an option.  The EFTA Court's guidance was that an SPC would be invalid to the extent that it covers anything other than the authorised product.

The decision of the Norwegian Court of Appeal is not yet final since an appeal to the Norwegian Supreme Court remains possible at time of writing.  In addition, it remains to be seen whether the CJEU and/or other national courts will adopt similar reasoning.  Nonetheless, we offer the following conclusions and recommendations:

1.  Applicants should be alert to the risk involved if the definition of the product offered in an SPC application could be interpreted as broader than the authorised medicinal product -- a definition that is too broad may result in loss of the entire SPC and it may be impossible to amend after grant.

2.  The approach of the CJEU in Farmitalia for salts and esters of small chemical compounds has been confirmed, but it appears likely that this will not be found to be directly applicable to (complex) biological products.

3.  There may be some scope for an SPC to protect biological products that are "therapeutically equivalent" to an authorised product, but it remains unclear how best to define the product in order to allow for this -- language relating to a lack of any systematic, consistent (and significant) difference in quality, safety and efficacy may be helpful.

4.  Where possible (bearing in mind patent claim scope and time limits) consider applying for a separate SPC based on the applicant's own patent and a competitor's MA.  Such an application could use a narrow product definition directed specifically to the competitor's authorised biological product.  This will permit an SPC application for the applicant's own product to be presented with a definition that minimises the risk mentioned in 1.

^[1] Translation of decision available here.
^[2] Translation of decision available here.
^[3] Similar status to the CJEU for matters referred by the national courts of the EFTA states: Norway, Iceland, Liechtenstein. Copy of the advisory opinion available here.
^[4] Article 4: Within the limits of the protection conferred by the basic patent, the protection conferred by a certificate shall extend only to the product covered by the authorisation to place the corresponding medicinal product on the market and for any use of the product as a medicinal product that has been authorised before the expiry of the certificate.  Full regulation available here.
^[5] C-392/97.  Full decision available here.Bottom of Form

This article was reprinted with permission from J A Kemp.