Patent Docs

News from Abroad: Pravastatin Sodium Case, Japan Product-by-Process Claiming Practice: Supreme Court Overrules the Grand Panel of the IP High Court

By Dr. Shoichi Okuyama* --

Product-by-process claim drafting and interpretation practice were greatly modified by the Pravastatin Sodium Case decisions (Japan Supreme Court, June 5, 2015, Second Petty Bench, case Nos. 2012(ju)1204 and 2012(ju)2658).  Japan's highest court reversed the Grand Panel of the IP High Court; two points were emphasized in the opinion of the Court:

Products made by a Different Process Infringe the Claim:  "[E]ven if a patent claim concerning a product invention recites the manufacturing process of a product, the technical scope of the patented invention should be determined to cover products that have the same structure and characteristics, etc., as those of the product made in accordance with the manufacturing process."

Product-by-Process Claims When Only Way to Define Product:  "[W]hen patent claims concerning a product invention recite the manufacturing process of a product, the claims would satisfy the requirement [that] "the invention be clear" according to Article 36(6)(ii), Patent Act, only if circumstances exist under which it is impossible or utterly impractical to directly identify the structure or characteristics of the product at the time of filing."

An analysis follows, with more expansive extracts from the Supreme Court opinion at the end of this paper.

The Supreme Court Lipase Decision (1991):  The Supreme Court in this decision recognized the importance of the public notice function of patent claims.  Citing the Lipase Decision, the Court in the Pravastatin Sodium Case reiterated the public notice function of patent claims.  In the earlier Lipase Decision the Supreme Court rejected the idea of reading a limitation from the specification into pending claims.  The Tokyo High Court (now IP High Court) read "lipase" in the claim as the species "Ra lipase" because all examples in the specification in the context of the patent examination proceedings were for Ra lipase.  The Lipase Decision was an appeal from a JPO decision to reject the application.

The Supreme Court stated that:

When the patentability requirements according to Article 29(1) and (2), Patent Act are examined; that is, the novelty and inventive step of an invention found in a patent application, the gist of the invention in the application has to be determined in order for the invention to be compared with prior art defined in Article 29(1).  Unless special circumstances exist, this determination of the gist has to be made based on the recitations in the claims.  Only if special circumstances exist such as when the technical meaning of a recitation in the claim cannot be understood without ambiguities, or when it is apparently clear that such recitation is an error with reference to the detailed descriptions of the invention in the specification, it is permitted to refer to the detailed description of the invention in the specification.

The Supreme Court has thus apparently Justice Yamamoto's sharply worded Concurrence once again rejected the idea of differentiating the scope of a patent claim based on circumstances or conditions that exist outside the claim.

Justice Yamamoto's Sharply Worded Concurrence:  Justice Yamamoto, who started his career as a bureaucrat at the Ministry of International Trade and Industry (now the Ministry of Economy, Trade and Industry), concurred with the Judgement but criticized the majority opinion.

Supreme Court Reference to American Court decisions:  In the supporting opinion, Justice Chiba discussed the en banc decision of the Federal Circuit in Abbott Labs. v. Sandoz, Inc. (2009), and the Nautilus United States Supreme Court decision.

Implications for Product-by-Process Claiming:  Under these new Supreme Court decisions, the Japan Patent Office now has to examine patent applications containing product-by-process claims to determine whether or not any circumstances exist under which it was impossible or utterly impractical to directly identify the structure or characteristics of the product at the time of filing.  The burden rests on the applicant to show to show such circumstances existed as of the filing date.  It is generally not easy to show that something is impossible to accomplish while it may be easier to show the contrary.  Also, the applicant may have to make sure that the structures or characteristics of, say, antibiotics, microorganisms or modified cells are described in detail in the patent application, although claims identifying such structures or characteristics may be more difficult to understand.

Questioning the Validity of Existing Patents:  The validity of existing patents that have product-by-process limitations in the claims may have to be questioned.

* * *

Pravastatin Sodium Case
Case No. 2012 (ju) 1204
Patent infringement case demanding injunction
June 5, 2015
Ruling of the Second Petty Bench

Excerpts from the opinion**

Judgement

The original decision is reversed.

The case is remanded to the Intellectual Property High Court.

Reason

Concerning the first, second, fourth, and fifth points raised in the Petition for Acceptance of Final Appeal by appeal attorney Kiyoshi Kamiya.

1        In the present case, the appellant, who has a patent including a so-called product-by-process claim which recites the manufacturing process of a product with the patent being granted on a product invention, asked for an injunction on the manufacture and sale of pharmaceutical products the appellee produces and the disposal of such products, because the appellee's pharmaceutical products allegedly infringe on the appellant's patent.  The appellee asserts, for example, that such pharmaceutical products does not fall under the technical scope of the patented invention of the appellant.  An issue in dispute is how the technical scope of a patented invention should be determined when the manufacturing process is recited in a patent claim directed to a product invention.

2        Summary of the original court decision and determined facts are as follows.

(1) The present patent
The appellant has a patent on an invention entitled "Pravastatin sodium substantially free of pravastatin lactone and epi-pravastatin, and compositions containing same," (patent No. 3,737,801, and the number of claims is nine. Hereinafter, it is called "the subject patent.")

(2) The present invention
Claim 1 of the claims of the patent (hereinafter referred to as "the subject claim.") is as follows (hereinafter referred to as "the present invention").
"Pravastatin in which the mixing amount of the pravastatin lactone is less than 0.5 wt%, pravastatin sodium contamination of epiprava is less than 0.2% by weight, prepared by a process comprising the following steps:
    a) forming a concentrated organic solution of pravastatin;
    b) precipitating pravastatin as an ammonium salt thereof;
    c) purifying the ammonium salt by recrystallization;
    d) transposing the ammonium salt to the pravastatin sodium; and
    e) isolating pravastatin sodium."

(3) The appellee's product

A. The appellee manufactures and sells pravastatin Na salt tablets 10mg of the drug "KH" (formerly known as pravastatin Na salt tablets 10mg "Merck", hereinafter referred to as "the appellee product".).

B. The appellee's product contains pravastatin sodium that has less than 0.5 wt% of mixed pravastatin lactone and less than 0.2 wt% of mixed epiprava.  Its method of manufacture, at least, does not involve "a) forming a concentrated organic solution of pravastatin" recited in the subject claim.

3        The original decision made determinations as follows and dismissed the demand of the appellant.

(1) The technical scope of a patented invention, when the manufacturing process of a product is recited in patent claims directed a product invention, the technical scope of such invention should be limited to products manufactured according to the manufacturing process described in the claim, unless there exist circumstances in which it is impossible or difficult at the time of filing to directly identify the product by its structure or characteristics.

(2) Since no such circumstances as in (1) above exist for the present invention, the technical scope of the present invention should be limited to those produced by the production process.  The process for making the appellee's product does not involve at least "a) forming a concentrated organic solution of pravastatin" recited in the subject claim, the appellee's products do not fall within the technical scope of the present invention.

4        However, we cannot accept the criteria indicated in 3(1) above discussed in the original decision, and we cannot accept the determination made on the basis of such criteria discussed in 3(2) above.  The reasons for this are as follows:

(1) The claims attached to the application has the function of defining the technical scope of the patented invention based on what is described in the claims (Article 70(1), Patent Act), and also determining the gist of the invention in the patent application for which examination of patentability requirements such as those prescribed in Article 29 of the same Act is carried out based on what is in the claims (Supreme Court decision of March 8, 1991, Case No. 1987(gyotsu), the ruling of the Second Petty Bench, published in Minshu, Vol. 45, No. 3, page 123).  While patents are granted on product inventions, method inventions, and inventions of processes for producing products, when a patent is granted on a product invention, the effect of the patent covers products that have the same structure and characteristics, etc. as those of the patented product without any regards to the manufacturing process.

Therefore, even if a patent claim concerning a product invention recites the manufacturing process of a product, the technical scope of the patented invention should be determined to cover products that have the same structure and characteristics, etc., as those of the product made in accordance with the manufacturing process.

(2)  By the way, according to Article 36(6)(ii), Patent Act, recitations in the claims have to satisfy the requirement that "the invention be clear".  The patent system is to provide protection over inventions for patentees by granting patents that are monopolistic rights to those who disclosed inventions, and encourage the utilization of inventions by letting third parties know of patented inventions, for the purpose of encouraging inventions, and thereby contributing to the development of industry (Article 1, Patent Act).  We understand that the requirement of clarity of the invention in the claims according to Article 36(6)(ii) is provided for this purpose.  In view of this, in every case where the manufacturing process of a product is described in a patented claim directed to a product invention, if the effect of the patent is determined in such a manner that the technical scope of a patented invention is determined to cover products that have the same structure and characteristics, etc. as those of the product made in accordance with the manufacturing process, it is problematic in that third party interests may possibly be unjustifiably prejudiced.  In other words, if the manufacturing process is recited in a patented claim directed to a product invention, it is generally unclear what structures or characteristics of the product are represented by the manufacturing process, or it is unclear whether the technical scope of the claim directed to a product invention is limited to products manufactured by the manufacturing process.  The reader of such recitation in the claims cannot clearly understand the content of the invention, and it makes unpredictable what scope of monopoly the proprietor has.  This is not entirely appropriate.

On the other hand, in patent claims directed to a patent for a product invention, such product is ordinarily identified by clearly reciting its structure and characteristics in a direct manner.  However, depending on the nature, property or the like of the product, it may be technically impossible to analyze its structure or characteristics at the time of filing, or it may require an outrageously large economic expenditure or time to carry out work necessary to identify.  In view of the nature of patent applications which requires speed, etc., there may be cases where it is not practical to require applicants such identification.  Therefore, it should be made possible to recite a manufacturing process in a claim directed to a product invention.  If the above-mentioned circumstances exist, third party interests would not be unjustifiably harmed even if the technical scope of the patented invention is determined to be products that have the same structure and characteristics, etc. as those of the product made by such manufacturing process.

As we have discussed above, when patent claims concerning a product invention recite the manufacturing process of a product, the claims would satisfy the requirement of "the invention be clear" according to Article 36(6)(ii), Patent Act, only if circumstances exist under which it is impossible or utterly impractical to directly identify the structure or characteristics of the product at the time of filing.

5        Differing from the above, the judgement in the original decision, which says that when the manufacturing process of a product is recited in the claims, while generally allowing such recitation in the claims, the technical scope of the patented invention should be determined to be limited, as a rule, to products manufactured according to the manufacturing process described in the claim, contains a clear violation of law which affects the conclusion of the decision.  The drift of the arguments is reasoned, and the original decision has to be reversed.  Then, the case is remanded to the original court, so that in accordance with what is discussed in this decision, proceedings should be completed concerning whether the recitation in the claims satisfies the requirement of "the invention be clear" and allowable when the circumstances discussed in section 4(2) above exist, and the technical scope of the invention should be determined.

Thus, in the opinion of the justices unanimously, it is ruled as in the Judgment.  In addition, Justice Katsumi Chiba has a supporting opinion[1], and Justice Tsuneyuki Yamamoto has an opinion[2].

 -- The rest of the decision has not been translated --

 

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* Patent Attorney with Okuyama & Sasajima

 

** This is a tentative English Translation of the Majority Opinion of the Supreme Court of Japan in Case No. 2012(ju)1204 as published on the web site of the Supreme Court (Supporting Opinion by Justice Katsumi Chiba and Opinion by Justice Tsuneyuki Yamamoto are not included. Underlining is shown as it appears in the decision.)

[1] Justice Chiba explained the majority opinion (about 5 pages) in greater detail in a lengthy discussion (about 8 pages).

[2] Concurring in judgement

News from Abroad: Research Exemptions and Active Ingredient Manufacture

By Ralph Cox* & Kinjal Kondhia** --

After a series of papers, reports and consultations on the scope of the research exemptions to patent infringement stretching over 10 years, section 60 of the Patents Act 1977 was finally amended on 1 October 2014 by the introduction of new subsections 6D to 6G.  These subsections clarify the pre-existing 'Bolar' exemption for clinical trials for generic drugs in subsection 6(5)(i) as well as extending it to regulatory tests for new drugs so as to put the UK on a level playing field for the conduct of trials with countries such as Germany, which introduced a wider Bolar exemption from the outset.  But the amendments seem to leave an important point unresolved:  would a manufacturer of active pharmaceutical ingredients (API) infringe by supplying a patent protected drug to another for use in clinical trials? 

Background

The Department of Trade & Industry and the Intellectual Property Institute issued a paper in 2004 saying that the research exemptions in the Patents Act were unclear and pointing to anecdotal evidence that the fear of proceedings dissuaded small research groups particularly from conducting potentially infringing research.  This was picked up by the Gower Report on Intellectual Property in 2006 which recommended that section 60 of the Patents Act be clarified.  Formal and informal consultations by the UK Intellectual Property Office followed between 2008 and early 2014 which, though initially considering research exemptions generally, ended up focusing on whether and how the Bolar exemption should be widened to match its implementation in other European countries.

The Bolar exemption was introduced into the Patents Act 1977 in October 2005 by insertion of 60(5)(i) in order to implement European Union (EU) Directives 2004/27/EC and 4004/28/EC, for veterinary and human drugs respectively.  The Directives limited the exemption to acts required to obtain a marketing authorisation for a generic drug and accordingly so did section 60(5)(i).  While some EU member states took a similarly narrow approach, such as Ireland, Sweden and the Netherlands, others took a wider approach, generally because they had pre-existing Bolar-type provisions in their legislation.  Thus countries such as Germany, France, Italy, Spain and Poland exempted trials conducted for regulatory approval of innovative as well as generic drugs from patent infringement.  This was seen as putting the UK at a competitive disadvantage as a country in which to conduct clinical trials.

A further issue was the scope of the acts covered by the Bolar exemption.  While both the Medicines and Healthcare Products Regulatory Agency (MHRA) and the UK Intellectual Property Office (UK IPO) gave guidance on the activities they considered to be covered, uncertainty persisted, particularly whether conducting bioequivalence and stability studies for a generic marketing authorisation would constitute infringement.  Also, assessments of drugs by, for example, the National Institute for Health and Care Excellence (NICE) to decide whether to recommend their use by the National Health Service, and which could involve comparison studies with patented drugs, were not covered.

Extended Bolar Exemption

As mentioned, the upshot of the consultations was the insertion of new subsections 6D to 6G in section 60 of the Patents Act 1977 from 1 October 2014.  Subsections 6D and 6E read:

"(6D)    For the purposes of subsection (5)(b), anything done in or for the purposes of a medicinal product assessment which would otherwise constitute an infringement of a patent for an invention is to be regarded as done for experimental purposes relating to the subject-matter of the invention.

(6E)      In subsection (6D), "medicinal product assessment" means any testing, course of testing or other activity undertaken with a view to providing data for any of the following purposes—

(a)        obtaining or varying an authorisation to sell or supply, or offer to sell or supply, a medicinal product (whether in the United Kingdom or elsewhere);

(b)       complying with any regulatory requirement imposed (whether in the United Kingdom or elsewhere) in relation to such an authorisation;

(c)        enabling a government or public authority (whether in the United Kingdom or elsewhere), or a person (whether in the United Kingdom or elsewhere) with functions of—

(i)        providing health care on behalf of such a government or public authority, or

(ii)       providing advice to, or on behalf of, such a government or public authority about the provision of health care,

to carry out an assessment of suitability of a medicinal product for human use for the purpose of determining whether to use it, or recommend its use, in the provision of health care."

Subsection 6F then defines "medicinal product" as a human or veterinary drug and 6G says that nothing in 6D to 6F affects the application of the general research exemption in section 60(5)(b) to acts falling outside 6D.  Section 60(5)(b) exempts from infringement acts "done for experimental purposes relating to the subject-matter of the invention".  Quite what research falls within the "subject-matter of the invention" and how the section applies to tests for commercial purposes were concerns that underlay the 2004 paper mentioned above[1].

Apart from making section 60(5)(i) redundant, the effects of 6D to 6F are to extend the Bolar exemption to innovative drugs and to all forms of regulatory drug assessment as well as to clarify that data generated in UK trials can be used for regulatory approval in other jurisdictions.  As the UKIPO's Explanatory Document[2] says, "in short, any tests or studies which are required by regulatory bodies will be allowed".

Discussion

While these amendments are undoubtedly welcome for the pharmaceutical industry, particularly the innovative side, they do not address the remaining uncertainty over section 60(5)(b)'s scope and nor do they address a more recent issue on the supply of API for clinical trials. 

The issue arose from litigation between Astellas Pharma Inc. and Polypharma SA in which the Polish Supreme Court held in October 2013[3] that a third party supplier of an API to a pharma company conducting trials for regulatory approval would not be within the Bolar exemption as it was making the API for its own commercial purposes and had not directly applied for regulatory approval itself.  In a parallel action in Germany a similar decision was reached by the Landgericht Düsseldorf that such a supplier would only be within the exemption if it was a co-organiser of the trials.  The German appeal court sought guidance on the issue of third party supply from the Court of Justice of the EU[4], and the UK IPO consulted on whether to intervene, but the reference was withdrawn in May 2014 with no decision having been made.  This leaves it unclear outside Poland and Germany whether a pharmaceutical company that does not manufacture API itself can source from a third party for a clinical trial. 

For the UK, new subsections 6D to 6F at first read would seem to allow third party supply as they allow "anything done in or for the purposes of a medicinal product assessment".  There is nothing restricting the exemption to acts by the party intending to apply for regulatory approval only and there is no good reason why just because manufacture of an API for use in a clinical trial is outsourced it should infringe.  On the other hand, the UK IPO's guidance[5], while not explicitly addressing the issue, says that "The new provisions do not extend to commercial activities, such as sale, commercial supply, or manufacture in preparation for sale or supply".  Some commentators have taken this to indicate that third party supply for a clinical trial would infringe following similar reasoning to the Polish Supreme Court.  The authors' view is that the UK IPO's statement is directed at commercial supplies generally, rather than the specific circumstances of concern here, and so should not be read as qualifying the broad "anything done" language in 6D.  Third party supply should therefore be within the scope of the extended Bolar exemption but, as ever with new legislation, it is a point that will have to wait for the courts to decide.  In the meantime it leaves unwelcome uncertainty, particularly for smaller generic companies that tend not to manufacture their own API and for EU based API manufacturers, which will lose custom to non-EU competitors.

* Ralph Cox is a Partner with Fasken Martineau LLP (London, UK)
** Kinjal Kondhia is a Trainee Solicitor with Fasken Martineau LLP (London, UK)

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[1] Though the obiter decision in Corevalve v Edwards Lifesciences [2009] FSR 8 gave some clarity by holding that if the preponderant purpose of the experiments is to gain information rather than generate revenue then it will be within the s60(5)(b) exemption.

[2] The explanatory document on “The Legislative Reform (Patents) Order 2014.

[3] CSK 92/13, Astellas v Polypharma.

[4] C-661/13 - Astellas Pharma Inc.

[5] “Changes to patents legislation made by the Legislative Reform (Patents) Order 2014 from 1 October 2014”

News from Abroad: Myriad Patent Upheld by Full Federal Court of Australia

By Claire Gregg* and Martin O'Brien** --

The Full Federal Court of Australia has handed down its long awaited decision in D'Arcy v Myriad Genetics Inc today, affirming that isolated DNA and RNA are patentable subject matter under Australian law.

The first instance decision of Nicholas J was appealed to the Full Federal Court on the grounds that the earlier Federal Court decision erred in its conclusion that isolating a gene is sufficient to render it a manner of manufacture.  We refer you to our article of 15 February 2013 for a more detailed discussion of the first instance Federal Court decision.

Under Australian law, s 18(1)(a) of the Patents Act 1990 requires that, in order to constitute patentable subject matter, the claimed invention must be 'a manner of manufacture within the meaning of section 6 of the Statute of Monopolies'.  The meaning of 'manner of manufacture'was broadly construed by the High Court of Australia in National Research Development Corporation v Commissioner of Patents (NRDC), which held that a claim directed to a product found in nature may constitute a manner of manufacture provided that the claimed product involves an artificially created state of affairs and has utility in a field of economic significance.

In view of the principles laid down in NRDC, the Full Federal Court unanimously upheld the decision of Nicholas J, emphasizing that '[t]his case is not about the wisdom of the patent system.  It is about the application of Australian patent law, as set out in the Act and as developed by the courts since the Statute of Monopolies'.

The Court went on to note that it is not the role of the courts to decide 'whether, for policy or moral or social reasons, patents for gene sequences should be excluded from patentability', re-iterating that the Australian Parliament has previously considered such questions and chosen not to exclude gene sequences from patentability.

The Court concluded that an isolated gene sequence is different to the gene as it exists in nature, with specific reference to the functional differences that arise as a result of isolation.  The Court further rejected the view of the U.S. Supreme Court that Myriad's claims are concerned 'primarily with the information contained in the genetic sequence'.  Rather, the Full Court emphasized that the claim in question 'is to a compound; a nucleic acid.  It is not a claim to information'.

The Full Court's decision that the isolated nucleic acid in question has 'resulted in an artificially created state of affairs for economic benefit' and is therefore capable of defining patentable subject matter, has maintained the status quo in Australia in relation to the patentability of isolated gene sequences.  However, the possibility of an application for Special Leave to Appeal to the High Court still exists, and thus it may be some time before this matter is finally put to rest in Australia.

The decision of the Full Federal Court of Australia can be found here.

* Dr. Gregg is a Patent Scientist with the Chemical / Life Sciences Team of Spruson & Ferguson in Sydney, Australia.

** Dr. O'Brien is a Principal / Patent Attorney with the Chemical / Life Sciences Team of Spruson & Ferguson in Sydney, Australia.

News from Abroad: The Regretful Patentee -- The Re-Emergence of File Wrapper Estoppel & Equivalence in the UK

By Ralph Cox* and Simon Spink** --

Overview

For the best part of 10 years, since the judgment of Lord Hoffmann in Kirin-Amgen v Hoescht Marion Roussel[1], it has been widely assumed that there is no file wrapper estoppel in the UK and no doctrine of equivalents either.  Both these assumptions are thrown into doubt by the Patent Court's decision in Actavis v Eli Lilly[2].  The judge, Mr Justice Arnold, held that the court should not shut its eyes to the prosecution file but should ensure a patentee did not abuse the system by accepting narrow claims during prosecution and then argue for a broader construction in a subsequent infringement action.  The judge also applied the more or less defunct Improver or Protocol Questions[3] in a manner that potentially opens the door to a doctrine of equivalence in all but name.

Use of the File Wrapper

In Kirin-Amgen, Lord Hoffmann said that there were good reasons why the German and English courts discouraged, if not actually prohibited, the use of patent office files in aid of the construction of claims.  The reasons included that the meaning of a patent does not change depending on whether a party has access to the office file or not and anyway the file may reflect no more than a patentee's desire to get the patent granted quickly without further argument with the examiner.  In short, it was a difficult and likely unproductive exercise to use the file wrapper to try to work out what the patentee meant by a claim's terms.

Taking the hint, parties and the courts made little use of file wrappers in subsequent cases with Sir Robin Jacob observing in Eli Lilly v Human Genome Sciences[4] that he was not confident it was legitimate to do so even though the UK courts had yet to decide the matter conclusively.  Going further, Mr Justice Floyd in Qualcomm v Nokia[5] warned that it was positively counterproductive to be referred to prosecution documents as it alerted the tribunal to the fact that there might be something to be said for the alternative construction.

Doctrine of Equivalents

While Lord Hoffmann considered that Article 69 of the European Patent Convention firmly shut the door on any doctrine which extended protection outside the claims, he acknowledged that equivalence could be an important part of the background that would affect the skilled person's understanding of a claim.  This was consistent with Article 2 of the Protocol on the Interpretation of Article 69, which states that, in balancing the literal and purposive construction of a patent's claims, due account should be taken of "any element which is equivalent to an element specified in the claims".  However, he doubted the usefulness of the Improver Questions in reaching a purposive construction saying that there was only one compulsory question:  what would a person skilled in the art have understood the patentee to have used the language of the claim to mean?

Following this decision, the Improver Questions have seldom been used in UK patent actions.  In Smith & Nephew v Convatec Technologies[6] it was even questioned whether a 1992 decision on infringement of a numerical limitation would have been decided the same way following Kirin-Amgen as it had been using the Improver Questions.

The Actavis v Eli Lilly Decision

The Actavis case concerned Eli Lilly's European patent protecting its cancer treatment, Alimta.  The patent claims the active ingredient, pemetrexed disodium, in combination with vitamin B12 and, optionally, a folic protein binding agent.  Actavis sought declarations that its proposed generic version of Alimta, which would contain one of pemetrexed diacid, pemetrexed dipotasium or pemetrexed dimethamine, did not infringe.  As Actavis was not challenging validity, it was allowed to seek declarations of non-infringement under the French, Italian and Spanish designations of the patent as well as the UK designation.

In his judgment, Mr Justice Arnold carefully reviewed the case law on both use of file wrappers and the doctrine of equivalence.  On the latter, he identified three main classes of case in which patentees resort to arguments on equivalence, namely where:

(i)       the patent has been poorly drafted (as in the Improver case);

(ii)      technology has moved on significantly since the patent was filed (as in Kirin-Amgen); and

(iii)     the patent regrets a decision taken during the course of prosecution.

The Actavis case was a clear example of the third category.  Eli Lilly had attempted to broaden its claims in prosecution to cover "pemetrexed", failed and accepted the narrower claims to pemetrexed disodium.  It had reserved the right to file a divisional application, but did not do so.  It clearly now wished it had broader claims in order to catch Actavis on infringement.  But there was "no reason why the law should be sympathetic to the patentee", which not only had the benefit of skilled professional advice but also had the opportunity to appeal against adverse decisions by patent examiners.  Further, allowing examiners' decisions effectively to be overturned by the courts on claim construction would undermine their important role.  Against this background, Mr Justice Arnold made use of the prosecution history as one of several reasons why Eli Lilly's broad construction, that pemetrexed disodium encompassed other salts because the important pemetrexed anion was present irrespective of the cation used, should be rejected.

He also used the Improver Questions, partly because there was no dispute that the alleged infringement was not within the primary, literal meaning of the claim and partly because the parties used them for consistency in their submissions on the non-UK designations.

Conclusion

Mr Justice Arnold observed that the US has a doctrine of equivalence and a doctrine of file wrapper estoppel to counterbalance it.  While following prior case law, the UK had neither, file wrapper estoppel is back albeit only in the case of the regretful patentee.  Even then, as Arnold J warned, the courts should be cautious using the prosecution history only when it is short, simple and shows clearly why the claims are in their granted form and not broader.

As regards equivalence, using the Improver Questions having held that there is plainly no literal infringement comes very close to Lord Hoffmann's description of the US approach in Kirin-Amgen as being "to adhere to literalism in construing the claims and evolve a doctrine which supplements the claims by extending protection to equivalents".  Even if not explicitly recognised as a doctrine of equivalence, the decision may therefore lead to a resurrection of the Improver Questions by patentees effectively arguing just that.

* Ralph Cox is a Partner with Fasken Martineau LLP (London, UK)
** Simon Patrick Spink is a Senior Associate with with Fasken Martineau LLP (London, UK)

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[1] [2005] RPC 9

[2] [2014] EWHC 1511 (Pat)

[3] From Improver v Remington Consumer Products [1990] FSR 181 - in brief, as guidance on arriving at a purposive construction of a claim, the Questions ask whether a variant has a material effect on the way an invention works, whether this was obvious at the patent's publication date and whether strict compliance with the primary meaning of the claim is nonetheless essential.

[4] [2013] RPC 22

[5] [2008] EWHC 329 (Pat)

[6] [2013] EWHC 3955 (Pat)

News from Abroad: New Zealand's New Patents Act

By Shelley Rowland* and Katherine Hebditch** --

After a protracted gestation period, the New Zealand's Patents Act 2013 will take full effect on 13 September 2014.  The new Act represents the first major refresh of New Zealand's patent legislation in 60 years, and brings New Zealand patent law into line with most other countries around the world.  The likely effect of the new law will be to make it more difficult to obtain patent protection in New Zealand, but patents which are granted should be more robust.

There is presently a window of opportunity to take advantage of the benefits provided by the current law.  In addition, there is likely to be a period of adjustment and uncertainty while the New Zealand patent examiners find the boundaries of the new requirements.  Therefore, those who consider New Zealand to be an important or potential market for their innovations should consider filing prior to the new law taking effect.

Significant Changes -- Examination and Validity

There are many changes that will be implemented when the new Act takes effect in September.  Some of the main changes introduced will affect examination and how the validity of patent applications is assessed.  These include:

• Examiners at the Intellectual Property Office of New Zealand (IPONZ) will be able to assess a patent application for inventive step (obviousness) and utility.  They will also be able to rely on prior use when assessing the novelty of any invention.  Currently IPONZ does not examine for inventive step or utility and is unable to rely on prior use.  However, these may be relied on by a third party to challenge the validity of a patent.

• The novelty and inventive step of an invention will be assessed against matter made available to the public anywhere in the world (absolute novelty), rather than just what was known or used in New Zealand (local novelty).

• The information contained in the specification and claims of prior filed patent applications with an earlier priority date, but which were not published at the time of filing, may be relied on when considering questions of novelty.  Currently only the claims of such a prior filed patent application may be relied on.

• The claims of an application must be "supported by" the matter disclosed in the specification.  The test for "support" is likely to involve an assessment of whether the specification describes the invention sufficiently to enable a skilled person to carry out the invention over the full scope of the claims.  This is likely to be a higher standard than presently applied.

• Some computer program based inventions will not be patentable.  In addition, inventions the use of which would be considered to be contrary to public order may be refused protection.

• Presently patent examiners give the applicant the "benefit of the doubt" when deciding whether an application meets the requirements of the Act.  Under the new Act, a stricter "balance of probabilities" standard will be applied.

What Should Applicants Do?

There is a window of opportunity to take advantage of the lower examination and validity standards provided by the current Act ahead of implementation of the new Act.  In order to do this, applicants will need to file their New Zealand patent applications before 13 September 2014.  This means the final day to file convention applications (i.e., non-PCT National Phase) and New Zealand National Phase applications under the current law is Friday 12 September 2014.  As the time zone in New Zealand is ahead of most of the rest of the world, applicants should ensure they contact a New Zealand patent attorney by Thursday 11 September 2014 if they want to meet the filing deadline.

If you would like any further information regarding the advantages of filing patent applications before the new law comes into effect, please contact the authors.

This article is intended to summarise potentially complicated legal issues, and is not intended to be a substitute for individual legal advice.  Please contact a New Zealand IP professional before acting on any information contained in this publication.

* Shelley Rowland is a partner at Baldwins Intellectual Property specializing in the field of biotechnology. She has particular experience in the areas of molecular biology, biochemistry, genetic engineering, and immunology.

** Katherine Hebditch is an associate at Baldwins Intellectual Property specializing in the field of chemistry. She has particular experience in the area of human and veterinary pharmaceuticals.

Image of flag and map of New Zealand (above) by Ozhiker, derivative work by Beao, from the Wikipedia Commons under the Creative Commons Attribution-Share Alike 3.0 Unported license.

News from Abroad: Double Patenting at the EPO -- What Does "Same Subject Matter" Mean?

Although the EPC does not specifically prohibit double patenting, that is the grant of two patents to the same applicant for the same invention, it is generally accepted that two patents cannot be granted to the same applicant for the same subject matter.  However, what is meant by "the same subject matter" has in the past caused some confusion as it too is not defined by the EPC.  A recent case before the Technical Board of Appeal (T 1780/12) has shed some light on its meaning.

The Case

The Board of Regents of the University of Texas (UTS) applied for two patents, EP1 and EP2.  EP2 was filed as a divisional of EP1 and was subsequently given the same filing date as EP1.

Both EP1 and EP2 related to the use of antibodies to aminophospholipids for cancer treatment.

The claims of EP1 were "Swiss-type claims" which are a form of purpose-limited process claim usually set out in the form "Use of X for the manufacture of a medicament for the treatment of Y"

The divisional application was filed after EPC2000 came into effect.  EPC2000 allows for compounds which are useful in a method of treatment by therapy to be drafted as purpose limited product claims.  The claims of EP2 contained such claims in the form "X for use in the treatment of Y".

EP1 was granted before EP2 and this forced the EPO to consider whether it could grant EP2 due to the restriction on double patenting.  The EPO refused EP2 on the grounds of double patenting which prompted an appeal from UTS.  The appeal focused on whether the EPO had neglected to focus on the scope of the claims and had focused too intensely on the language of the claims.

The Appeal

The Technical Board of Appeal (TBA) overturned the decision of the EPO.

The TBA first considered what is meant by the term "subject matter" in the context of double patenting.  The TBA held that the subject matter of a claim was determined by two aspects, the category of the claim and its features.  Using this analysis, the TBA arrived at the conclusion that EP1 and EP2 related to the same invention.  However, for EP1 and EP2 to claim the same subject matter, and therefore fall foul of the objection, it was held that it was not enough for EP1 and EP2 to relate to the same invention.

The TBA held that the questions of what is the "claimed subject matter" in the context of double patenting is to be determined by the scope of protection afforded by the claims.  In agreement with another Board of Appeal in T 1391/07, the TBA held that double patenting could only arise where EP1 and EP2 related to notionally the same scope of protection.  Double patenting does not arise if the scope of protection conferred by the claims of EP1 and EP2 overlap only partially.

The claims of EP1 were purpose-limited process claims and the claims of EP2 were purpose-limited product claims.  It is well accepted that a claim to a process confers less protection than that of a product claim.  The scope of the claims of EP1 and EP2 were therefore different and so could not be seen to confer notionally the same scope of protection.

Comment

Whether double patenting is an issue is not merely an assessment of the category of conflicting claims but rather their features and claim scope.

Practically, to avoid double patenting, it is not sufficient merely to consider the wording of the claims and to arrive at a conclusion about protection based upon that wording, but to interpret the wording to arrive at a sensible picture of the scope of protection that is being sought.  This assessment ought to be carried out at the time of filing a divisional application since it may be difficult to significantly change the scope of the claims of a divisional application later.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.

News From Abroad: Australia Is a Favourable Jurisdiction for Innovator Pharmaceutical Companies Seeking Interlocutory Injunctions

By Andrew Mullane, Craig Humphris, Todd Shand --

Due to the complexity of Australian patent litigation, it can take more than 18 months for a patent dispute to be finally determined by a judge.  This is more than enough time for an infringing competitor to irreversibly damage the patentee and its exclusive market.  Interlocutory injunctions (also known as preliminary injunctions) are designed to prevent competitors from marketing their products before the court finally determines whether they infringe (or the patent is invalid).

Australian courts appear strongly inclined to grant interlocutory injunctions, and within a very short period of time, in pharmaceutical patent disputes.  Annexure 1 (below), which outlines 16 interlocutory injunction applications filed by pharmaceutical patentees since 2005, shows that only three of those applications were rejected.  Annexure 1 also demonstrates that, if necessary, the courts will hear an interlocutory injunction application and deliver its judgment very quickly (in as little as four days) to protect the patentee's market.  This article provides a brief introduction to interlocutory injunctions in Australia and explains why innovator pharmaceutical companies are likely to be granted interlocutory injunctions in Australian patent disputes.

BACKGROUND TO INTERLOCUTORY INJUNCTIONS IN AUSTRALIA

Determination of the Application

Applications for interlocutory injunctions are heard at first instance by a single judge of the Federal Court of Australia.  The court will grant an interlocutory injunction against an alleged infringer (such as a generic) if it is satisfied that:

(a)  the patentee has a prima facie case; and

(b)  the balance of convenience lies with granting the injunction.

Prima Facie Case

A patentee has a prima facie case if there is a probability that they will succeed at final trial (i.e., it is arguable that (a) infringement has occurred and (b) the patent is valid).  An invalidity case must verge on the irresistible to defeat a prima facie infringement case.

When deciding whether the patentee has a prima facie case, courts are usually reluctant to consider legal or factual disputes in any detail because:

(a)  the court is only required to consider whether the patentee's case is arguable, rather than reach a final conclusion; and

(b)  while both sides will make submissions and put on evidence, they are seldom as comprehensive as would be adduced for a final trial, and witnesses are rarely cross-examined, limiting the court's ability to choose between them.

Instead, the court will typically simply acknowledge that both positions are arguable, and find that the patentee has established a prima facie case.  Accordingly, this element is usually quite easy to satisfy.

Balance of Convenience

When considering whether the balance of convenience favours granting the interlocutory injunction, the court will weigh up all of the surrounding factors.

First, the court will consider the harm that the patentee may suffer if an interlocutory injunction is refused and a final injunction is subsequently granted, and whether that harm can be compensated by way of damages.  The greater the patentee's potential loss, the more likely the court is to grant the injunction, particularly if it cannot be adequately compensated by damages (such as reputational damage).  Patentees often argue that allowing the generic onto the market will:

(a)  reduce the patentee's sales and force it to lower its prices to compete with the generic, affecting profit;

(b)  cause flow-on losses to other areas of the patentee's business, including reputational damage, reduced opportunities to promote other products and the forced reduction in expenditure on research and development and marketing, damaging future revenue streams; and

(c)  encourage other generics to enter the market, causing further damage to the patentee and significantly complicating the assessment of how damages should be apportioned between the generics.

The patentee's potential harm is a particularly strong factor if the generic intends to list their product on the Schedule of Pharmaceutical Benefits (Schedule) under the Pharmaceutical Benefits Scheme (PBS).

By way of background to Australian drug regulation and subsidisation, pharmaceutical products cannot be marketed in Australia unless they are registered on the Australian Register of Therapeutic Goods (ARTG).  If a prescription medicine is registered on the ARTG, the sponsor may also apply to list it on the Schedule.  The PBS is administered by the Australian government and seeks to subsidise the cost of medicines to the public.  The Australian government sets the price of all products listed on the Schedule (PBS Price).  Patients who purchase a listed prescription medicine from a pharmacy are required to pay a set proportion of the PBS Price, with the Australian government reimbursing the pharmacy with the balance of the PBS Price.  If a generic version of an innovator product is listed on the Schedule, the PBS Price paid by the government for that product (and therefore the amount that pharmacies will pay the innovator for its product) is automatically reduced by 16%.  If the generic offers its product at a discount to the innovator product, as is often the case, the PBS Price may be decreased even further.  Importantly, a decrease in the PBS Price is virtually always irreversible.

Accordingly, if a generic is permitted to list their product on the Schedule, the innovator will be paid a reduced PBS Price over the life of the patent, irrespective of whether they are successful in obtaining a final injunction, causing the patentee significant and continuing loss.  This potential loss will often persuade a court to award an interlocutory injunction because:

(a)  it is likely to be very significant; and

(b)  assessing the patentee's continuing loss caused by the reduced PBS Price is difficult because it involves estimating future sales.

The court will consider whether the generic will suffer any loss if the interlocutory injunction is granted and the patentee's infringement argument is rejected at the final trial.  Generics often refer to:

(a)  the advantage of being the first competitor to market, both in terms of market share for that product and flow-on effects to other products; and

(b)  the difficulty of estimating what would have been the generic's market share, and therefore calculating their profit, had the interlocutory injunction been refused.

As generics tend to significantly discount their products, their potential loss is typically much less than that of a patentee.  Further, it is often argued that a generic who elects not to revoke a patent before entering the market knowingly takes the risk of having an interlocutory injunction awarded against them, such that their loss is self-inflicted.  Courts regularly use this argument to reduce the weight given to a generic's loss.

The strength of the patentee's infringement case, compared with the strength of the generic's invalidity case, is also relevant.  If the patentee has a strong case, the court will be more likely to award the interlocutory injunction.  Conversely, there is less inclination to award an interlocutory injunction if the patentee appears unlikely to succeed at the final trial.

Any unreasonable delay from the patentee in bringing the interlocutory injunction action will also weigh against its grant.

Prospects of Success

For the reasons given above, particularly:

(a)  the low standard of proof required to establish a prima facie case;

(b)  the patentee's perceived greater extent loss (especially if the product is listed on the Schedule);

(c)  the common discounting of a generic's loss as being self-inflicted; and

(d)  the possibility of other generics entering the market;

Australian courts are strongly inclined to grant interlocutory injunctions.

This tendency is highlighted by the table at Annexure 1, which lists 16 interlocutory injunction applications filed by pharmaceutical patentees since 2005 and shows that only three applications were rejected.  An analysis of those rejected applications shows that two were the result of the application of a different (more generic-friendly) law to that which currently stands in Australia (in combination with the atypical circumstances of the patentee's unreasonable delay or the generic's undertaking not to list on the PBS), while the third was a result of the patentee having a weak infringement case.

(a)  The court in Hexal v Roche held that, for an interlocutory injunction to be awarded, Roche (the patentee) must show that it would suffer irreparable harm.  As discussed above, potential irreparable harm now forms part of the assessment of the balance of convenience, rather than its own separate prerequisite.  It was found that Roche could be adequately compensated by damages, partly because Hexal undertook not to apply to list its product on the Schedule.  Notably, the rejection of the application was accompanied by a warning from the court that the parties should prepare for the final trial as quickly as possible to minimise Roche's potential harm, and that a failure to do so "might well justify reviewing the decision".

(b)  Like Hexal v Roche, the court in Interpharma v Aventis required Aventis (the patentee) to show that it would suffer irreparable harm.  Damages were found to adequately compensate Aventis because the patent would expire within 18 months and the relevant market (chemotherapy medication) was not overly competitive.  The court's decision was also swayed by Aventis' unreasonable eight month delay in filing its interlocutory injunction application.

(c)  In Warner-Lambert v Apotex, the court refused the interlocutory injunction application because Warner-Lambert did not establish a prima facie case.  Its patent was directed to the use of pregabalin for treating pain.  Apotex did not infringe because (i) its ARTG registration only indicated the use of pregabalin as an adjunctive therapy for preventing seizures and (ii) its promotional material clearly stated that pharmacies could not dispense its product without a prescription explicitly stating that it was required for treating seizures.

Timing of the Interlocutory Injunction

Annexure 1 also demonstrates that, if necessary, the courts will hear an interlocutory injunction application and deliver its judgment very quickly (in as little as four days in the case of GenRx v Sanofi-Aventis).  While there is no indication in the GenRx v Sanofi-Aventis judgment as to why a decision was required so quickly, such reasons are given in other cases.

(a)  In Abbott v Apotex, judgment was delivered on 20 November 2009, 18 days after the interlocutory injunction application was filed, because Apotex had threatened to bring product onto the market on 21 November 2009.

(b)  An interlocutory injunction was granted in Apotex v AstraZeneca within 15 days because Apotex had already commenced its marketing campaign and was ready to launch its generic product onto the market.

(c)  In Warner-Lambert v Apotex, Apotex advised Warner-Lambert on 14 February 2014 that it would bring its generic product to market on 14 March 2014.  Warner-Lambert commenced proceedings on 25 February 2014, meaning the court was required to (and did) decide the interlocutory injunction application within just 17 days.

Pressure-Testing a Case

An interlocutory injunction application in Australia also provides an excellent opportunity for a patentee to test the strength of their case.  The generic is required to reveal (at least part of) its non-infringement and invalidity evidence and arguments, and the judge may provide some preliminary comments in relation to both parties' cases.  Furthermore, an interlocutory injunction application is much less expensive than a final trial, and can be decided very quickly if required.  It can accordingly provide an indication of the patentee's likelihood of ultimate success (both in Australia and internationally) quite quickly and relatively inexpensively.  Even if the patentee discovers that their case has significant weaknesses, for the reasons discussed above they would nonetheless have good prospects of succeeding with respect to the interlocutory injunction, strengthening their position during any settlement negotiations with the generic.

Conclusion

The combination of high success rates and fast judgments means that Australia is currently a jurisdiction that favours pharmaceutical patentees seeking interlocutory injunctions.  Further, the insight gained into the strength of the patentee's case can be invaluable, allowing a more productive consideration of whether to enforce a patent in Australia and abroad.

Annexure 1 (click on table to enlrage)

Mr. Mullane is a Lawyer with Wrays; Mr. Humphris is a Principal with Wrays and Senior Member of Wray's Adelaide Chemical and Biological team; and Mr. Shand is a Principal with Wrays.

News from Abroad: A Strict Approach to Priority Entitlement by the UK Court of Appeal

The Decision of the Court of Appeal in Hospira UK Generics Ltd. v. Novartis AG, [2013] EWCA Civ. 1663 was issued on 19 December 2013.

Background

The case was initially heard in the High Court and raised the issue of entitlement of a patented invention to priority.  The patent in question was European Patent (UK) 1 296 689, owned by Novartis AG, which related to the use of a particular member of the bisphosphonate class of drugs for the treatment of osteoporosis, amongst other things.

The particular claim in question was Claim 7 which can be expressed as the combination of the following features:

(i) the use of a zoledronate medicine
(ii) for the treatment of osteoporosis
(iii) where the medicine is adapted for intravenous administration in a unit dosage form
(iv) comprising from about 2 up to about 10 mg of zoledronate
(v) wherein the period between administrations is about one year

Claim 7 claimed priority from two priority documents.  The case, in part, related to whether the second of these priority documents, namely United States patent application number 267689 (hereinafter referred to as 'the priority document'), disclosed the subject matter of Claim 7.  It was agreed that Claim 7 would be invalid if it was not entitled to priority since an intervening publication would become available for an attack on validity.

In the High Court, Mr Justice Arnold held that the Claim 7 was not entitled to priority since there was no disclosure in the priority document linking all of the features of Claim 7.  Thus, the claim was rendered invalid.

Novartis appealed the Decision of the High Court.

Appeal

Novartis argued that the judge in the court of first instance was led into error by failing to read the priority document as a whole.  Novartis added that had the priority document been read as a whole, the judge would have appreciated the clear link between zoledronate, osteoporosis and intravenous administration which ran through the entire document.

In addressing Novartis' argument, Lord Justice Floyd outlined the law on the approach to priority, noting that although the language of Section 5 of the UK Patents Act and Article 87 EPC (which relate to priority) is different, the two formulations must be taken to mean the same thing (see Jacob LJ in Unilin Beheer BV v Berry Floor NV [2004] EWCA (Civ) 1021; [2005] FSR 6 at [39]).  More specifically, Article 87 EPC states that for a valid priority claim, the later patent application must be in respect of the same invention.  The Enlarged Board of Appeal in G2/98 held that the requirement for claiming priority of the same invention was met if the skilled person could derive the subject matter of the claim directly and unambiguously, using the common general knowledge, from the priority application as a whole.

Following this, Lord Justice Floyd asserted that the problem for Novartis in seeking to establish that Claim 7 was entitled to priority was that the disclosure of the priority document was either too general or too specific.

In particular, the passage relating to zoledronate in an amount of from about 2 up to about 10 mg once a year told the skilled person nothing about the dosage range for any particular method of administration.  Further to this, it did not tell the skilled person about the dosage range for any particular condition, for example osteoporosis, i.e., the passage was too general.

Contrary to Novartis' assertion that the passage relating to zoledronate in an amount of from about 2 up to about 10 mg once a year was applicable to all modes of administration and all conditions, Lord Justice Floyd held that the passage would be read by the skilled person as meaning that depending on the method of administration and the condition being treated, some doses within the range may be suitable.

Example 5, on the other hand, disclosed 4 mg of zoledronate taken once a year, administered intravenously to patients with post-menopausal osteoporosis as being effective.  However, it was held that Example 5 did not disclose any other doses that could be used at that dosage interval, i.e., the passage was too narrow.

Since there was no disclosure in the priority document linking all of the features of Claim 7, Lord Justice Floyd concluded the claim was not entitled to priority from United States patent application number 267689 and thus, it followed that the patent was invalid.

Conclusions

Even though each of the features of Claim 7 was disclosed in the priority document, without the explicit linking of these features, the subject matter was not considered clearly and unambiguously disclosed to the skilled person (in accordance with G2/98).  In view of this Decision, it is advisable to take extra care when drafting priority documents to ensure that there are clear linking statements for all the claimed subject matter.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.

News from Down Under -- High Court of Australia Confirms That Claims to Methods of Medical Treatment Are Patentable in Australia

By Gary Cox, Craig Humphris and Donna Meredith --

In the decision of Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd [2013] HCA 50 (order), the High Court of Australia, Australia's supreme court, confirmed that methods of medical treatment are a "manner of manufacture" and therefore represent a patentable invention in Australia.  Although Australia's Patent Office (IP Australia) and the Australian Federal Courts have previously determined and held that such claims are patentable, the matter has never been tested before Australia's supreme appellate court, the High Court of Australia.  The decision is significant because it now provides certainty to both innovators and generics alike, that such claims are patentable.  The decision also provides guidance on what might constitute indirect infringement of a second medical use claim by the supply of a product for a first off-patent medical use.

BACKGROUND

In 2008, Sanofi commenced first instance proceedings in the Australian Federal Court against Apotex claiming that Apotex's supply of leflunomide to treat psoriatic arthritis would infringe Sanofi's Australian Patent No 670491 ("the Patent"), which covers a method of using leflunomide to treat psoriasis.  It is well known that in the majority of cases, patients with psoriatic arthritis have, or will, develop psoriasis and Sanofi claimed that Apotex's product used on psoriatic arthritic patients would also treat psoriasis.  Importantly, in their product information sheet, Apotex included a statement expressly excluding the use of their product for the treatment of psoriasis that is not associated with manifestations of arthritic disease.

Apotex responded by filing: (1) a defence that its product did not infringe the Patent; and (2) a cross-claim, asserting that the Patent is invalid, claiming that a method for treating the human body was not a patentable invention.

In 2011, the Federal Court dismissed Apotex's cross-claim and found that Apotex had threatened to infringe Sanofi's patent.  On appeal to the Full Federal Court in July 2012, the Full Court upheld the trial judge's decision.  Apotex applied for special leave from the High Court to appeal from the decision of the Full Federal Court.  Special leave was granted in December 2012.

THE DECISION

The High Court (which, at the time, comprised French CJ, Hayne, Crennan, Kiefel and Gageler JJ) was asked to answer the following two questions:

Question 1: Is a method of medical treatment a "manner of manufacture" and therefore a patentable invention?

Question 2: If an existing patent is directed to a method of treating a particular disease by the administration of a known drug, does a third party infringe that patent by supplying the same product for the purpose of treating a different disease not covered by the patent?

(a)    Question 1 – Patent Validity

In delivering their judgement, the Court considered the body of case law in both Australia and the United Kingdom relating to manner of manufacture.  Consideration was also given to the positions held in other major jurisdictions.  The High Court ultimately reduced the debate down to two fundamental questions:

1.  Is a process a proper subject for the grant of a patent under the 1990 Act only if it results in a product (a result, outcome or effect) which can be exploited commercially?

2.  If yes to the above, does a method of prevention or treatment of human disease meet that requirement?

In Australia, the boundaries of the definition of "manner of manufacture" are broad and constantly evolving and it is identified in the Explanatory Memorandum to the Patents Bill 1990 as meaning:

"little more than that an invention must belong to the useful arts rather than the fine arts."

In their judgement, the majority placed emphasis on the following excerpt from the judgment of Lockhart J in the Australian Federal Court (Full Court) decision of Anaesthetic Supplies Pty Ltd v Rescare Ltd (1994) 50 FCR 1 at 19:

"If a process which does not produce a new substance but nevertheless results in 'a new and useful effect' so that the new result is 'an artificially created state of affairs' providing economic utility, it may be considered a 'manner of new manufacture' within s 6 of the Statute of Monopolies."

In consolidating the views of the majority, Chief Justice French of the present case stated:

"The exclusion from patentability of methods of medical treatment represents an anomaly for which no clear and consistent foundation has been enunciated.  Whatever views may have held in the past, methods of medical treatment, particularly the use of pharmaceutical drugs, cannot today be conceived as 'essentially noneconomic'."

The majority of the High Court (Hayne J dissenting) therefore answered in the affirmative to the patent validity question, confirming that methods of medical treatment of the human body are valid patentable subject matter in Australia.  This is consistent with long-standing practice in Australia and is in line with the decision of the High Court of Australia in Bernhard Joos v Commissioner of Patents (1972) 126 CLR 611, which held that cosmetic processes or methods for improving or changing the appearance of the human body, which could be considered economically beneficial, were proper subject matter for the grant of patents.

(b)    Question 2 – Patent Infringement

While the majority of the High Court finding that the Patent was valid, their Honours found that Apotex's leflunomide product did not infringe the patent.

According to s117(1) of the Patents Act, if the use of a product by a person would infringe a patent, then supply of the product can also infringe a patent.  Sanofi's primary argument relied on section 117(2)(c), which states:

"(2)     A reference in subsection (1) to the use of a product by a person is a reference to:

(c) . . . the use of the product in accordance with any instructions for the use of the product, or any inducement to use the product, given to the person by the supplier or contained in an advertisement published by or with the authority of the supplier."

In the alternative, Sanofi contended that Apotex was indirectly infringing their patent pursuant to section 117(2)(b), which states that:

"(2)     A reference in subsection (1) to the use of a product by a person is a reference to:

(b) if the product is not a staple commercial product - any use of the product, if the supplier had reason to believe that the person would put it to that use."

Since Apotex's instructions specifically excluded the use of their product for non-arthritic psoriasis, the court found that Apotex was not liable for contributory infringement and that the product information sheet does not engage section 117(2)(c) of the Act.  The court held that it could not be inferred that Apotex had any reason to believe that their product would be used according to Sanofi's patented method, given that this would have been contrary to the stated indication on the product information sheet provided by Apotex.

In light of this decision, it now appears that in cases where an off-patent pharmaceutical is the subject of a second medical use patent, supply of the pharmaceutical for the purpose of the first medical use might not be considered an infringement of the second medical use patent, provided express instructions are provided by the supplier that the product is only to be used for the off-patent use.  Generic suppliers might ultimately avoid being liable for contributory infringement in cases where the end user has used the product for the patented second medical use "off label", despite instructions to the contrary from the generic supplier.  However, the outcome may be very different if there was evidence to suggest that the generic knew, or ought to have known, that their product might be used in a way that would infringe the innovator's patent.

News from Abroad: Are Multiple SPCs per Patent Allowed?

Historically, it was widely thought that it was possible to obtain a separate supplementary protection certificates (SPC) for each product covered by a patent.  However, in its judgment in Medeva in 2011, the Court of Justice of the European Union (CJEU) held that where a patent protects a product, only one SPC may be granted per patent.  This judgement caused uncertainty and controversy particularly as to whether multiple SPCs could be granted on a patent which covers multiple products.

The CJEU have recently issued a judgement in Georgetown University v Dutch Patent Office which attempts to clarify these issues.

Georgetown University is the proprietor of European Patent 0 647 140, which is directed to 'Papillomavirus vaccines'.  The patent included separate claims to various types of recombinant L1 protein of human papillomavirus (HPV).  Having already obtained two SPCs based on this patent, Georgetown filed a further application for an SPC directed to recombinant L1 protein HPV type 16.

The application for the SPC was refused by the Dutch Patent Office on several grounds including that the SPC regulation prohibited the grant of more than one SPC per patent regardless of the number of products claimed in the patent.  This case was appealed to the District Court of The Hague which referred five questions to the CJEU seeking guidance on whether multiple SPCs can be granted on a basic patent which covers multiple products.

In answer to the first question, which related to whether the SPC regulation precludes the proprietor of the basic patent being issued a certificate for each of the products protected, the CJEU confirmed the Medeva decision that only one SPC may be granted per patent.

The second and third questions asked whether an Applicant having several SPC applications pending at the same time on the same patent can choose which one takes priority, or whether the national authorities take that decision.  Clearly it would be desirable for the patentee to be able to make this choice and the CJEU held that it should be the applicant who decides which of his SPC applications proceeds.  However, in the absence of the patentee making a choice, it was noted that it is up to the national authorities to resolve the matter under national law.

The remaining questions related to whether the holder of a granted SPC may surrender it with retroactive effect so that he may pursue an alternative SPC on the same patent.  While the SPC regulation does include a provision for surrender of SPC rights, the CJEU found that such surrender is unlikely to have a retroactive effect and thus the earlier right would still have existed at the time the subsequent application was filed.  The CJEU reasoned that if the SPC holder could retroactively cancel the SPC to substitute it with an SPC of different subject-matter or duration, the legal certainty of the SPC Regulation would be compromised.

It is therefore imperative that patentees give careful thought as to which product they would like to be the subject of an SPC before any application is filed.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.

News from Abroad: EPO Clarifies Extent to which Methods Involving Use of Human Embryos Are Excluded from Patentability

Generally, the European Patent Office does not allow claims to methods involving the use of human embryos for industrial or commercial purposes.  It was therefore perhaps not surprising that the Examiner objected to the claims of EP 05028411.6, which related to a method for obtaining pluripotent embryonic stem cells from an embryo.  In defence of the claims, the applicant argued that, since the embryo was not destroyed in the method, the claims were allowable following the decision of the Enlarged Board of Appeal G2/06 (the "WARF" Decision).

However, this argument was not accepted.  The Examining Division maintained that the overriding consideration as to whether a method involving the use of a human embryo is patentable or not is whether the claimed method is of diagnostic or therapeutic benefit to the embryo.  Since the embryo did not benefit from the claimed method, the application was refused.

On appeal it was accepted by the Board of Appeal that, where the claimed method was of diagnostic or therapeutic benefit to the embryo, there would be an exemption from the general exclusion from patentability of methods involving the use of embryos.  The applicant tried to rely on this by arguing that the cells obtained by the claimed method could later be used to treat the human that had developed from the embryo from which the cells had been obtained.  However, as this future use was not specified in the claim, the Board rejected the argument.

The applicant then attempted to amend the claims to disclaim "industrial and commercial uses" of the stem cells obtained by the method of the invention.  Since the application as filed did not have specific basis for the disclaimer it was necessary for the Board to consider whether the proposed disclaimer fell within the conditions laid down in the Decision G1/03 of the Enlarged Board of Appeal as to whether the disclaimer was allowable.  The Board held that the proposed disclaimer did not fall within the specific circumstances laid down in G1/03.  It reasoned that the claims without the disclaimer were directed to a method of obtaining embryonic stem cells as a direct product of the method.  The proposed disclaimer merely excluded the future use of the obtained stem cells and, as such, the subject matter that the applicant was attempting to exclude was not covered by the original claims and as such could not now be disclaimed without adding subject matter.  The appeal was therefore rejected.

It is apparent that, in order to be patentable, a method involving human embryos must be of diagnostic or therapeutic benefit to the embryo itself and that the step giving the benefit must be specified in the claim.  Applicants should therefore take care when drafting patent applications to inventions involving the use of human embryos to specify diagnostic and therapeutic benefits in the application.  In addition, it may be advisable to state in the description that, for example, stem cells recovered may not be for commercial or industrial usage in order to provide basis for any disclaimer which may subsequently be required.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.

News from Abroad: UKIPO Decides on Correct Term of an SPC

A recent UKIPO decision will extend the term of SPCs by a few days.  The decision concerned Genzyme Corporation's product colesevelam hydrochloride, which was the subject of an SPC.  Genzyme disputed the term of the SPC on two grounds.

First, Genzyme argued that the term of the SPC should be calculated using the date of notification of the relevant marketing authorisation, rather than the date of the decision itself.  The term of an SPC is calculated as the duration between the date on which the application for a basic patent was lodged and the date of the first authorisation to place the product on the market in the Community, reduced by a period of five years.  However, every marketing authorisation has two dates, namely the date of the decision and the date of notification (which can be up to four days later).

The UKIPO decided that it is indeed the date of notification and not the date of the decision that should be used to calculate the term of an SPC, mainly based on the wording in the TFEU that specifies that decisions (including the decision of the authorisation) take effect upon notification.  Further, the applicant is not aware of the grant until the date of notification and a copy of the granted marketing authorisation is required to apply for an SPC.  The earliest date an applicant can apply for an SPC is therefore the date of notification.

Secondly, Genzyme argued that the "Euratom Regulation" should be applied to the term of an SPC.  This regulation determines the rules applicable to periods, dates and time limits and states that, where a period of time is calculated from the occurrence of an event, the day on which the event falls should not be part of the period itself.  This would extend the term of an SPC by an additional day.  However, it was held that this is not relevant as the period at issue is a period which can only be calculated after a specific event occurs, rather than a period expressed as so many hours, days, weeks, months and/or years after the occurrence of an event.  In other words, the period at issue is a period between two specific events and so the regulation does not apply.

The duration of an SPC should therefore be calculated using the date of notification of the marketing authorisation, rather than the date of the decision itself.  This can increase the term of the SPC by up to four days, which can be important for commercially valuable products.  However, the calculation of the term should remain the same, as the Euratom Regulation does not apply.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.

News from Abroad: Is an Emergency Marketing Authorisation Valid Basis for an SPC Application for a Plant Protection Product?

The Court of Justice of the European Union (CJEU) has recently ruled that an emergency Marketing Authorisation (MA) for a plant protection product does not provide a valid basis for an SPC for that plant protection product.

Background

Clothiamidine is the active ingredient of the insecticide product, Poncho®.  Clothiamidine was protected by European patent EP0376279, filed 27 December 1989, which covered Germany amongst other countries.  In December 2003, Sumitomo Chemical Co. Ltd. was granted an emergency MA for Clothiamidine by the German authorities due to an imminent threat to various crops.  The emergency MA was valid for 120 days.

In May 2004 Sumitomo filed an SPC at the German Patent and Trade Mark Office for Clothiamidine on the basis of the emergency MA and EP0376279.  The SPC application was refused.

Sumitomo appealed the decision to refuse the SPC to the German Federal Patents Court.  The Court, in turn, sought guidance from the CJEU as to whether an emergency MA provides proper basis for the grant of an SPC.

CJEU’s Decision

The CJEU noted that the SPC Regulation specifies a 6 month period from the grant of a marketing authorisation in which to validly file an SPC application for a plant protection product.  While the 6 month period in respect of the emergency MA had not passed when the SPC application as filed, because the emergency MA was only in force for 120 days, it was not valid when the SPC application was filed.  In effect, the emergency MA expired the day before the SPC filing date.

Notwithstanding the issue concerning the expiry of the emergency MA, the CJEU decided that the SPC Regulation ought to be interpreted as precluding the grant of an SPC for a plant protection product on the basis of an emergency MA for the product.  The CJEU noted that an emergency MA, by its very definition, is granted in special circumstances in which an emergency MA is needed in order to counteract an unforeseeable danger to a crop which cannot be contained by means other than the use of the active ingredient in question.  Plant protection products for which an emergency MA is granted do not undergo the same scientific testing and risk evaluation as plant protection products which are granted a provisional MA and which may serve as proper basis for an SPC application.

As an additional point, around 4 months after filing the SPC application, the German authorities granted a provisional MA for Clothiamidine.  Sumitomo attempted to amend its SPC application to refer to the provisional MA.  However, the CJEU confirmed that the SPC Regulation precluded the grant of an SPC for a plant protection product on the basis on an MA which was granted after the SPC application was filed.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.

News from Abroad: Further Referral by UK Patents Court to CJEU on Interpretation of SPC Regulation for Combination Products

The UK Patents Court recently issued a judgement which referred four questions to the CJEU in the case Actavis Group v Boehringer Ingelheim that aim to clarify how the SPC Regulation ought to be interpreted in respect of products having combinations of active ingredients.

This referral follows three earlier referrals to the CJEU concerning the interpretation of the SPC Regulation in the cases of Actavis v Sanofi, Lilly v Human Genome Sciences and Georgetown University.  These referrals were heard by the CJEU on 12 September 2013 and we are awaiting the CJEU's guidance to be issued.  It is suspected that the guidance on the three earlier referrals will provide a good indication as to how the CJEU will deal with the present referral.

Background and facts

Boehringer's European patent, EP (UK) 0502314, has a claim to a compound called telmisartan.  This compound is used in the treatment of hypertension and is marketed under the brand name Micardis.  The corresponding SPC is due to expire on 10 December 2013.

Boehringer also sells MicardisPlus, a product comprising telmisartan and hydrochlorothiazide.  In 2003 Boehringer applied to the UK IPO for an SPC to the combination of telmisartan and hydrocholothiazide.  EP (UK) 0502314 as granted did not have a claim specifically directed to this combination.  Boehringer therefore applied to amend the patent to insert a claim specifically directed to the combination.  Whilst the application to amend was pending the UKIPO agreed to suspend the SPC application for four months.  The amendment was granted and Claim 12, directed to the combination of telmisartan and hydrocholothiazide, was included in the amended patent.  The SPC for the combination was granted and is due to expire on 30 January 2017.

Actavis Group sought to invalidate the combination SPC in order to clear a path to launch its own product comprising telmisartan and hydrocholothiaziode.  In considering the invalidation action the UK Patents Court referred the four questions to the CJEU in order to seek clarification on the interpretation of the SPC Regulation in respect of combination products.

Questions referred

1.    (a) If a patent does not, upon grant, contain a claim that explicitly identifies two active ingredients in combination, but the patent could be amended so as to include such a claim could this patent, whether or not such an amendment is made, be relied upon as a "basic patent in force" for a product comprising those ingredients in combination pursuant to Article 3(a) of Regulation No 469/2006/EC ("the Regulation")?

(b)  Can a patent that has been amended after the grant of the patent and either (i) before and / or (ii) after grant of the SPC be relied upon as the "basic patent in force" for the purposes of fulfilling the condition set out in Article 3(a) of the Regulation?

(c)  Where an applicant applies for an SPC for a product comprised of active ingredients A and B in circumstances where,

(i)  after the date of application for the SPC but before the grant of the SPC, the basic patent in force, being a European Patent (UK) (the "Patent") is amended so as to include a claim which explicitly identifies A and B;

and

(ii)  the amendment is deemed, as a matter of national law, always to have had effect from the grant of the Patent;

is the applicant for the SPC entitled to rely upon the Patent in its amended form for the purposes of fulfilling the Art 3(a) condition?

The SPC regulation requires the basic patent which protects the active ingredient covered by the SPC to be in force.  In the present case, the patent as granted did not have a claim specifically to the combination of telmisartan and hydrocholothiazide when the SPC application for the combination was filed. Instead, a claim to the combination was added to the patent after the SPC application was filed.  The questions therefore arises as to whether the patent qualifies as "a basic patent in force" as per the requirement specified in the SPC regulation.

The UK judge's preliminary view was that given that amendments to UK patents have retrospective effect to the date of patent grant, if the amendment is allowable then when the amendment occurred ought to not affect the validity of the SPC.

2.    For the purposes of determining whether the conditions in Article 3 are made out at the date of the application for an SPC for a product comprised of the combination of active ingredients A and B, where (i) the basic patent in force includes a claim to a product comprising active ingredient A and a further claim to a product comprising the combination of active ingredients A and B and (ii) there is already an SPC for a product comprising active ingredient A ("Product X") is it necessary to consider whether the combination of active ingredients A and B is a distinct and separate invention from that of A alone ?

This question essentially asks whether, in order for an SPC to be granted to a combination of active ingredients, is it necessary to consider whether the combination has to be an "inventive advance" over either one of the active ingredients alone.

The issue of whether a combination of active ingredients amounts to an "inventive advance" over either one of the active ingredients is the subject of the referral by the UK Court to the CJEU in the case of Actavis v Sanofi.  The UK judge in the present case did not give his opinion as to what he thought the answer to this question ought to be, but preferred to wait for the CJEU's guidance in Actavis v Sanofi which is expected in the coming months.  However, the UK judge indicated that if the "inventive advance" question is of relevance in the case of telmisartan and hydrocholothiazide, then a further trial on this point will need to be held at a later date.

3.    Where the basic patent in force "protects" pursuant to Article 3(a):

(a) A product comprising active ingredient A ("Product X"); and

(b) A product comprising a combination of active ingredient A and active ingredient B ("Product Y").

And where:

(c) An authorisation to place Product X on the market as a medicinal product has been granted;

(d) An SPC has been granted in respect of Product X; and

(e) A separate authorisation to place Product Y on the market as a medicinal product has subsequently been granted.

Does the Regulation, in particular Articles 3(c), 3(d) and/or 13(1) of the Regulation preclude the proprietor of the patent being issued with an SPC in respect of Product Y? Alternatively, if an SPC can be granted in respect of Product Y, should its duration be assessed by reference to the grant of the authorisation for Product X or the authorisation for Product Y?

This question essentially asks whether the prior existence of the telmisartan SPC precludes the possibility of obtaining an SPC for the combination of telmisartan and hydrocholothiazide.  If the answer to this question is "no," then the question goes on to ask whether the term of the combination SPC ought to be limited to the term of the telmisartan SPC.

The UK judge indicated that he thought the telmisartan SPC should have no bearing on the grant of the combination SPC and that he would be surprised if the telmisartan SPC affected the term of the combination SPC.

4.    If the answer to question 1(a) is in the negative and the answer to question 1(b)(i) is positive and the answer to question 1(b)(ii) is negative, then in circumstances where:

i) in accordance with Art 7(1) Regulation, an application for an SPC for a product is lodged within six months of the date on which a valid authorisation to place that product on the market as a medicinal product has been granted in accordance with Directive 2001/83/EC or Directive 2001/82/EC;

ii)  following the lodging of the application for the SPC, the competent industrial property office raises a potential objection to the grant of the SPC under Article 3(a) of the Regulation;

iii)  following and in order to meet the aforesaid potential objection by the competent industrial property office, an application to amend the basic patent in force relied upon by the SPC applicant is made and granted;

iv)  upon amendment of the basic patent in force, said amended patent complies with Article 3(a);

does the SPC Regulation prevent the competent industrial property office from applying national procedural provisions to enable (a) suspension of the application for the SPC in order to allow the SPC applicant to apply to amend the basic patent, and (b) recommencement of said application at a later date once the amendment has been granted, the said date of recommencement being

•    after six months from the date on which a valid authorisation to place that product on the market as a medicinal product was granted but

•    within six months of the date on which the application to amend the basic patent in force was granted?

Question 4 is related to question 1 and asks whether the procedure adopted by the UKIPO to suspend the application for the combination SPC, whilst the application to amend the patent was heard, was the correct approach.  In his preliminary view, the UK judge could see no good reason why this approach could be challenged.

We await the CJEU's guidance on the referrals in the Actavis v Sanofi, Lilly v Human Genome Sciences and Georgetown University cases which is expected in the next few months.  This ought to give an indication of how it will deal with the four questions that have been referred in the present case.

This report comes from European Patent Attorneys at WP Thompson & Co., 55 Drury Lane, London UK.  Further details and commentary can be obtained from Gill Smaggasgale, a partner at the firm.