Patent Docs

News from Abroad: The Patents Court Considers the Appropriate Scope for Cross-Undertakings

Actavis v Boehringer [2013] EWHC 2927 related to a dispute over the combination of telmisartan and hydrochlorothiazide, which was marketed by Boehringer and protected by an SPC.  Actavis wanted to sell the combination product and believed the SPC to be invalid, but agreed to give an interim undertaking not to sell the combination product, pending the resolution of the dispute.  In return, Boehringer agreed to give a cross-undertaking.  However, there was a dispute over how far the cross-undertaking should extend.

Actavis sought a cross-undertaking that allowed (i) any company in the Actavis group and (ii) any customer or potential customer of any company in the Actavis group to obtain compensation for any loss it may have suffered as a result of the interim undertaking.  Actavis argued that this was appropriate as it covered a clearly defined class of persons and allowed for future corporate restructuring.

Boehringer objected that the scope was too wide, as it did not identify the persons to whom the cross-undertaking would extend.  It was argued that Actavis must have known which companies in their group were involved and the reference to "customers or potential customers" was said to be unclear.

Birss J held that any cross-undertaking can extend to any class of persons who may justly obtain compensation.  However, the relevant persons must be defined in some suitable way, as must the potential loss or harm that may arise.  A cross-undertaking was said to be the "price of an injunction" and so it is important that the party paying the price knows with reasonable certainty what it may be.

Regarding the first group of persons, it was held that the relevant tasks (i.e., selling the product) carried out by the Actavis group were clear and that these tasks defined the persons affected by the undertaking, as well as the loss they would suffer.  It was therefore deemed unnecessary to define exactly which persons in the Actavis group would carry out these tasks.  Birss J also agreed with Actavis' argument that the proposed wording would save Actavis having to reapply to the court each time they are involved in a corporate restructuring.  The court was therefore happy that the cross-undertaking should cover the first group of persons.

However, reference to the customers and potential customers in the second group was held to be unclear, not least because the combination product had not yet been put on the market by Actavis and so there were no customers.  Further, "potential customers" was said to be extremely vague with no real definition of who these could be or what loss they may suffer.  The cross-undertaking should therefore not cover the second group of persons.

Birss J also highlighted that third parties, such as customers or potential customers, are able to apply to the court to be joined in proceedings such that they can benefit from the cross-undertaking.  Allowing the cross-undertaking to extend to the second group of persons would prejudge any such application and would unfairly extend the scope of the cross-undertaking for the benefit of a few, specific third parties.

It is therefore clear that a cross-undertaking does not have to specifically define the exact persons to which it extends.  However, its scope must be defined in some way to allow the persons covered and the loss that they could suffer to be identified, as the party making the cross-undertaking must know the potential "price of the injunction."

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 to Rescind Deadline for Filing Divisional Patent Applications

Our colleagues at J.A. Kemp in the United Kingdom have advised us that they have received advance notice that the administrative council of the European Patent Office (EPO) has voted to amend Rule 36 EPC to remove the controversial 24-month time limit within which European divisional applications may be filed.  The sole criterion set forth in amended Rule 36(1) EPC will be that the application to be divided must still be pending.  In practice this means that any case that is not granted or finally refused can be divided once the new rule comes into force.

The amended rule is set to come into force on 1 April 2014.

Under the current rules, which came into force 1 April 2010 for applications filed after that date provided that applicants may divide their European patent application within 24 months of the first office action (or notice of allowance) or within 24 months of a new lack of unity objection being raised.

The amended rule will come into effect for all divisional applications filed on or after 1 April 2014, and so in some cases will serve to reopen previously closed divisional application filing windows.  Applicants wishing to file a divisional application in a case where the term under existing Rule 36 has expired may now wish to keep their application pending at least until 1 April 2014 and file one or more divisional applications then.

Simultaneously with this rule change, the EPO intends to introduce a new additional filing fee that applies to divisional applications of second generation or higher.  Although the level of the fee has not yet been set, it is expected to be of a low to moderate level, in the range of 200-800 Euros, and is expected to increase with successive generations.

Patent Docs thanks Tim Duckworth of J A Kemp for alerting us to this recent development.  Readers wishing further clarification can contact J A Kemp directly at www.jakemp.com.

For additional information regarding this and other related topics, please see:

• "EPO Proposal Would Remove Time Limit for Divisional Filing," September 13, 2013
• "Changes Coming to Divisional Application Practice in Europe," March 27, 2009

News from Abroad: EPO Proposal Would Remove Time Limit for Divisional Filing

Editor's note: The following notice was reprinted with permission from Forresters.

Our August 2013 News item: "EPO divisional deadline U-turn in the offing..." seems prescient.  We now learn that the EPO has made formal proposals to remove the current two-year time limit for filing divisionals.

Instead, the EPO proposes that applicants can file divisionals (and divisionals from divisionals) for as long as the original application is pending.  The EPO also wants to increase the filing fee for second and subsequent generation divisionals.

The proposals aim for 1 April 2014 to formulate and introduce appropriate amended rules.  Under the current proposals, applicants with a pending application (not granted, refused or abandoned) on 1 April 2014, can use it as the basis for a divisional application, even if the current two year limit has expired.

We recommend that you identify currently pending European patent applications where the divisional due date has expired, or will do before 1 April 2014.  If you are still interested in filing a divisional from any of these, you should slow prosecution as much as you can.  There are techniques enabling you to draw out EPO procedures, and we would be pleased to advise you on those.

News from Abroad: UK High Court Considers quia timet Injunctions

The UK High Court recently gave its judgment in the case of Merck, Sharp & Dohme Corp. and Bristol-Myers Squibb Pharmaceuticals Ltd (collectively referred to in the judgement as BMS) v Teva Pharma B.V. and Teva UK Ltd (Teva) (decision).  The judgement is interesting as it is one of the few so called "quia timet" injunctions that has been issued by the UK High Court on the basis of a contention by a patent proprietor that a generic pharmaceutical company intends to launch its generic drug whilst the patent and SPC under which the drug is protected are still in force.  A quia timet injunction is an injunction to restrain harm which has not yet occurred but what is being threatened is imminent.

The patent

Efavirenz is a drug used to control HIV infections and is protected by the patent EP (UK) 0 582 455 (and its associated SPC) which is owned by Merck.  The patent will expire on 3 August 2013 and the SPC on 20 November 2013.

Interim injunction

Teva obtained a marketing authorisation for Europe for generic efavirenz in early 2012.  From its actions in previous cases, such as the Warner Lambert case concerning generic atorvastatin, Teva had a reputation to launch generic versions of a drug while the patent and SPC protecting the drug were still in force.  BMS therefore asked Teva what its intentions were regarding the launch of generic efavirenz.  Teva replied that its policy was to not divulge commercial information to its competitors.  It also pointed out that the grant of the marketing authorisation for generic efavirenz permits but does not require Teva to market the generic product and that it was Teva's policy to not infringe valid patents.

Dissatisfied with Teva's reply, BMS applied to the UK court for injunctive relief alleging that Teva's actions to obtain a marketing authorisation for Europe at an unusually early time during the patent term and its reluctance to provide details of its intentions concerning the launch of generic efavirenz in the UK indicated an intention to infringe the patent and SPC.

Teva countered that the claim should be struck out because it was not based on the validity of the patent but instead on whether Teva's actions amounted to a threat to infringe.

The judge believed that BMS had reasonable grounds for seeking injunctive relief.  In the judge's view, the fact that Teva went to the trouble of obtaining a marketing authorisation for efavirenz gave a concrete inference that Teva intended to sell efavirenz at some time.  Furthermore, the judge found that the fact that Teva obtained the marketing authorisation almost 22 months before patent expiry, which is unusually early, supported an inference that generic efavirenz was intended to be launched before patent expiry.

An interim injunction was therefore granted on 15 March 2012 against Teva to prevent the launch of generic efavirenz in the UK.

Final trial

At final trial (decision issued on 9 July 2013) the only question that was considered was whether Teva, by its actions, threatened to infringe EP (UK) 0 582 455 and its associated SPC before their expiry and, thus, whether a final injunction for the remaining term of the patent and SPC ought to be granted.

Teva argued that at the time the action was brought (February 2012) it did not intend to launch generic efavirenz before expiry of EP (UK) 0 582 455 and its associated SPC.  Teva presented documentation from its in-house legal and commercial departments which, Teva asserted, supported its position.

The judge summarised the test under UK law for granting quia timet injunctions as whether, in all the circumstances, there is a sufficiently strong probability that an injunction will be required to prevent harm to the claimant occurring that the bringing of proceedings by the claimant is justified.  The defendant's intentions before the action is brought are central to the assessment.  Important considerations are the defendant's subjective intentions and acts and what third parties would perceive the defendant's intentions to be.

In the present case, in considering the "third parties perceptions" arm of the test, the judge held that when the action was brought, third parties would perceive that there was a threat to infringe EP (UK) 0 582 455 and its associated SPC because in the past Teva had launched products before expiry and without notice to the patentee.  In considering the "subjective intentions" arm of the test, during the case Teva had informed BMS that it did not "have any plans to supply pharmaceutical products containing efavirenz" in the UK before SPC expiry.  However, from internal documents disclosed by Teva during the trial, the judge found that Teva was actively considering whether or not to launch its generic drug in the UK before the expiry of the SPC.

The court therefore held that it was appropriate to continue the preliminary injunction to restrain Teva from infringing the patent and the SPC up to their expiry.

The judgement provides useful guidance for pre-action correspondence which seeks to ascertain when a company plans to launch its generic drug.  If generics companies withhold such information from patent proprietors they may face actions for quia timet injunctions.  Therefore, if a generics company is asked by an originator company about its intentions concerning the launch of a generic drug, the generic company should consider supplying assurances that generic drugs will not be launched while patent rights remain in force.  Such assurance may be given under confidence to prevent commercially sensitive information being divulged to competitor generics companies.

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: Second Referral for the "Broccoli" Patent Case to the Enlarged Board of Appeal

Following the issuance of decision G2/07 in connection with the "Broccoli" patent, which discussed whether plant breeding methods were excluded from patentability as essentially biological processes for the production of plants, the Technical Board of Appeal in proceedings T83/05 have now referred further questions to the Enlarged Board of Appeal, relating to whether the exclusion of Article 53(b) extends to the products of essentially biological processes.

The issue of whether the exclusion of Article 53(b) prohibits the allowability of the patent's product claims was only raised during appeal proceedings and not during opposition proceedings.  However, as the respondent had consented to the examination of the objection and as the objection was relevant to the maintenance of the patent, the Technical Board of Appeal decided to consider it.  Further, similar questions had been referred to the Enlarged Board of Appeal regarding the "Tomato" case, which are currently pending as case G2/12.

The Technical Board of Appeal suggested that the product claims were not excluded under Article 53(b), as the plants were not defined by a multitude of characteristics resulting from a given genotype or combination of genotypes but only by a particular trait, which is not sufficient to define a plant variety without providing further information about the genotype.

However, the essentially biological process claims of the application would cover plants which are produced by the excluded process.  Further, the subject-matter of a product-by-process claim extends to products which are structurally identical to the products produced by the process but are produced by a different process, though no alternative processes are disclosed in the application.  A product claim generally provides protection for the process of making the product and so the product claims discussed in this case would protect any act of making the claimed plants, including those processes excluded from patentability.

In response to this argument, the respondent raised the possibility of including a disclaimer to waive a part of the prerogatives of the owner of a product patent, namely the essentially biological process for producing the plant itself.  This disclaimer was not deemed to be a usual disclaimer (which excludes part of the subject-matter defined in the claim) and the Technical board of Appeal indicated that it was doubtful whether such a disclaimer would be allowed.

The questions to be referred are:

1.  Can the exclusion of essentially biological processes for the production of plants in Article 53(b) EPC have a negative effect on the allowability of a product claim directed to plants or plant material such as plant parts?

2.  In particular:

• (a) Is a product-by-process claim directed to plants or plant material other than a plant variety allowable if its process features define an essentially biological process for the production of plants?

• (b) Is a claim directed to plants or plant material other than a plant variety allowable even if the only method available at the filing date for generating the claimed subject-matter is an essentially biological process for the production of plants disclosed in the patent application?

3.  Is it of relevance in the context of questions 1 and 2 that the protection conferred by the product claim encompasses the generation of the claimed product by means of an essentially biological process for the production of plants excluded as such under Article 53(b) EPC?

4.  If a claim directed to plants or plant material other than a plant variety is considered not allowable because the plant product claim encompasses the generation of the claimed product by means of a process excluded from patentability under Article 53(b) EPC, is it possible to waive the protection for such generation by "disclaiming" the excluded process?

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.

Image of Brassica oleracea var. italica, Location: Maui, Foodland Pukalani (above) by Forest & Kim Starr, from the Wikipedia Commons under the Creative Commons Attribution 3.0 Unported license.

News from Abroad: UK Court of Appeal Rules on Interim Injunctions

The Court of Appeal recently issued a decision concerning the issues that should be considered when granting an interim injunction.  The proceedings related to Novartis' product zoledronic acid, which was used to treat osteoporosis.  This product was covered by a supplementary protection certificate (an SPC), as well as two use patents.  Hospira, a generics company, started revocation actions against these two patents and obtained a marketing authorisation for zoledronic acid to treat a number of conditions, including osteoporosis.

Soon after becoming aware of the marketing authorisation, Novartis wrote to Hospira requesting an undertaking that no product would be sold before the expiry of the SPC, which was duly given by Hospira.  A subsequent letter requested confirmation that if the claims were found to be valid in revocation proceedings, the product would not be launched even after the lapse of the SPC.  This confirmation was not given.  Instead, as both patents were found to be invalid in the revocation action, Hospira indicated their intention to launch the product after the lapse of the SPC.

Novartis appealed the revocation decision and started infringement proceedings concerning the two use patents and applied for an interim injunction to prevent Hospira's launch.  In response to this application, Hospira argued that once a decision on the merits had been given, a party needs an arguable case on appeal for an injunction to be granted and that it would not be right to equate such a case with a good arguable case on the merits at the start of proceedings.  It was argued that different considerations applied once trial had taken place.  The court of first instance held that the case was plainly arguable and that Novartis was more at risk of suffering larger losses.  However, the appeal on the revocation was not nugatory and did not have a strong prospect of success.  Instead, the appeal was arguable and could inflict uncompensatable harm on either side.  Further, it was said that Novartis should have started infringement proceedings earlier to allow a conclusion to be reached in good time.  An injunction was therefore not granted.  Novartis subsequently appealed against the decision on the granting of the injunction.

The Court of Appeal held that there was not a clear view on the merits, as the appeal had a realistic prospect of success.  The exercise of discretion should therefore not be approached on the basis that the merits are clear in favour of one side or the other.  It was further held that the previous decision on the merits should not affect the balance of hardships considered when granting an injunction.  This balance fell in Novartis' favour, based on the damage that would be suffered by Novartis if an injunction was not granted being more certain and greater in magnitude than the damage to Hospira if an injunction was granted.

The facts that Hospira was also selling zoledronic acid for other, less profitable diseases and that the public would be disadvantaged by an injunction were deemed to be irrelevant.  It was held that an appeal in cases such as this should be expected and that generic companies should have to disclose their intentions to the innovator in time for an appeal to take place, or expedite proceedings accordingly.  The decision at first instance could not be expected to determine Hospira's freedom to sell the product.  The Court of Appeal therefore found in Novartis' favour and granted an interim injunction.

This decision therefore sets a precedent for interim injunctions pending appeal to be granted even if the relevant patents were found invalid at first instance.

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: UK Court of Appeal Considers Sufficiency

The Court of Appeal recently heard a case relating to Genentech's patent, which claimed the use of human vascular endothelial growth factor (hVEGF) antagonists for the treatment of non-cancerous diseases which are characterised by excessive blood vessel growth (neovascularisation or angiogenesis).  Regeneron and Bayer sought a declaration of non-infringement and revocation of the patent based on construction, novelty, inventive step, and sufficiency arguments, all of which were rejected at first instance.  Regeneron and Bayer then appealed.

The main issue discussed in the appeal proceedings was that of sufficiency.  The appellants argued that the patent's scope was too broad as it covered a wide range of antagonists and diseases.  It would therefore impose an undue burden on the skilled person to identify which diseases can be treated with which antagonists.  The judge held that if it is plausible or credible that the invention will work over substantially the entire scope of the claims, the claims can be defined in general terms.  This was found to be the case in the present proceedings due to the common thread of angiogenesis between the claimed disease states and so the scope of the claims was considered appropriate.  However, if only a few embodiments would work, these must be claimed specifically.  As for evidence to support the claims, it was held that there is no need to report results of clinical trials, but the evidence must show that the therapeutic effect is plausible.

Further, the fact that regulatory approval would be hard to obtain was deemed to be irrelevant, as it takes into account factors such as side effects, which are not considered by the patent.  The appellants also cited various diseases as not being treated by the invention.  However, it was highlighted that it was only the angiogenic component that needed to be treated.  There was no evidence that there was no effect on the angiogenic component of the cited diseases, despite other components not being affected.  When discussing the construction of the claim, the judge found that angiogenesis must contribute to the pathology of the diseases covered, but need not be the cause of it.  This construction also meant that the skilled person would be able to easily identify the diseases covered by the claims.

Finally, it was argued that the patent was insufficient if it extended to the allegedly infringing molecule (a chimeric molecule demonstrating high affinity and improved pharmacokinetics), as production of such molecules would require undue effort and is not described in the patent.  However, it was held that the skilled person would have regarded chimeric molecules as variants falling within the scope of the claim.  It was emphasised that a claim for a broad invention could cover embodiments that may be invented in the future and which may have further advantageous properties.  The allegedly infringing molecule was such an embodiment as it encompassed the technical contribution of the claimed invention by binding VEGF and inhibiting its biological activity, despite requiring in itself a good deal of ingenuity.

The appellants also raised novelty and inventiveness objections over a document that discussed in vivo assays using VEGF antibodies and disclosed that the VEGF antibodies "may have therapeutic potential."  However, the judge held that the document did not disclose a therapeutic effect of the antibodies, or clear and unmistakeable directions to perform the invention.  Further, while the prior art suggested that VEGF may have therapeutic applications, it was disclosed as one of many factors being investigated.  The document also disclosed the antibodies as a research tool and so gave no reasonable expectation of success of using such antibodies therapeutically.

The claims were therefore found to be novel and inventive.  The appeal was dismissed and the patent was found to be valid and infringed on all counts.

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: UK Court Seek Clarification of the Term "Human Embryo"

In Oliver Brüstle v Greenpeace (Case 34/10) the Court of Justice of the European Union (CJEU) ruled that any non-fertilised but parthenogenically stimulated human ovum constitutes a "human embryo" within the meaning of Article 6(2)(c) as it is capable of commencing the process of development of a human being in the same way as an embryo created by fertilisation of an ovum.  Clarification of the scope term "human embryo" is important as it will determine whether technologies involving stem cells obtained from parthenogenically stimulated ova, but which cannot develop into a human being, are excluded from patentability as "human embryos" under the Directive.

The UK High Court has now referred this question to the CJEU.  The referral stems from the UK Intellectual Patent Office's decision to refuse two patent applications filed by International Stem Cell Corporation (ISCC) relating to human stem cells.  The technology covered by the patent applications related to unfertilised human ova, subject to division and further development only by parthenogenesis (a form of asexual reproduction whereby embryos can grow and develop without fertilisation).  The ova produced by the methods covered by the patent applications only contained pluripotent cells.  These cells undergo division as would an embryo formed by fertilization, but are incapable of developing into a human being.  The patent applications were refused by the UKIPO on the grounds that the inventions were excluded from patentability under paragraph 3(d) of Schedule A2 to the Patents Act 1977 as covering the use of human embryos.

ISCC argued that the UKIPO had incorrectly applied the test of "capable of commencing the process of development of a human being" not only to technologies involving embryos formed by fertilisation but also to technologies involving parthenogenesis and other processes such as somatic-cell nuclear transfer in non-fertilised ova.  ISCC argued that the correct application of the test was to exclude only technologies that enable the commencement of development which leads to a human being and not those technologies which enable the commencement of a process of development even if that process is incapable of leading to a human being.

The UKIPO considered that the test laid down by the CJEU may apply only on the start of a development process but the exclusion did not necessarily require completion of the process which results in the birth of a human being in order for the method to be excluded.  However, the UKIPO submitted that the test developed by the CJEU was unclear and supported the referral of the question to the CJEU for clarification on the matter.

When considering the Oliver Brüstle v Greenpeace case, the evidence before the CJEU was that parthenotes (bundle of cells produced following parthenogenises of an ova) have the potential to create a human being.  This is in contrast to the present case where it was accepted by all parties that the parthenotes produced by the methods of the invention were incapable of normal development.

On appeal, the Judge was persuaded by the view that parthenotes were not the same as fertilised ova at any stage and that if the process of development was incapable of leading to a human being, then it should not be excluded from patentability as a 'human embryo'.  The Judge therefore allowed the referral to the CJEU to seek clarification of the test.

It is apparent that the ISCC case turns on different facts to the Brustle decision since the technology covered by the ISCC patent applications produce parthenotes which cannot develop into a human being.  The UK High Court Judge stated that "excluding processes of development which are incapable of leading to a human being from patentability would not strike the purported balance sought by the Biotech Directive."

We will report again when the CJEU's judgement is handed down.

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: Court of Appeal Refers Questions on Specific Mechanism to Court of Justice of European Union

Merck Canada Inc and Merck Sharp & Dohme Ltd v Sigma Pharmaceuticals plc

Prior to their accession to the European Patent Convention, several states did not allow patent protection for pharmaceutical products.  To address this, a special derogation known as "The Specific Mechanism" was put in place.  This Specific Mechanism allows the holder of a patent or a supplementary protection certificate (SPC) for a pharmaceutical product filed at a time when such protection could not be obtained in a qualifying state to prevent importation and marketing of the product in member states where the product enjoys protection, even if the product was put on the market in the qualifying state for the first time by him or with his consent.  This mechanism also applied to the patentee's beneficiary.

Any person intending to import or market a pharmaceutical product has to demonstrate to the relevant national authority that one month's notification was given to the holder or his beneficiary before he can obtain the necessary notification.

Pharma XL (a company related to Sigma Pharmaceuticals) had given a notification to MSD BV (a company in the Merck group) relating to the importation of Merck's asthma product Singulair from Poland.  No reply was received and so Pharma XL applied for and received the necessary parallel importation license, after which Sigma began importing and selling Singulair.  It was only later that Merck wrote to Pharma XL, objecting to the importation and sale and claiming that such acts were infringements of the patent rights.

Various arguments were presented by Sigma at the first instance hearing, including that the derogation provisions are inapplicable unless and until the patent holder demonstrates his intention to exercise the option and that Merck was estopped from asserting its rights having failed to respond to the notification.  Merck argued that the notification was insufficient as it had not been sent by the parallel importation licence holder to the patent proprietor or his beneficiary.  The judge found in favour of Merck, and so Sigma appealed.

The Court of Appeal considered a number of issues during proceedings.  It was held that the lack of response was not a basis for estoppel, as the notification from Pharma XL did not impose on Merck a positive duty to respond.  Merck had no reason to be aware of Sigma's misunderstanding that it did not object to Singulair being on the market and there was no action by Merck that fostered this misunderstanding.  Further, there was no contractual obligation to respond to the notification and in general, taking no action does not prevent proceedings from being brought at a later date.

However, there were three issues on which a decision was not reached.  The first issue related to Sigma's argument that the derogation provisions are inapplicable if the patent holder does not demonstrate his intention to exercise the option.  Sigma referred to an earlier case (Generics and Harris v Smith Kline and French), which related to a similar derogation regarding importation from Spain and Portugal.  This decision emphasised that the proprietor "may rely on the rights granted by the patent" and that the "derogating provisions are therefore inapplicable unless the proprietor of the patent demonstrates his intention to exercise that option."  The Specific Mechanism was modelled on this previous derogation and so it was said to have the same essential meaning, which also explains the purpose of the notification requirement.

However, Merck highlighted that the wording does not oblige the patent holder to reply and suggested that the decision was not relevant, as it related to a patent open for licenses of right.  Further, Merck argued that a patent holder would always wish to assert his rights and so demonstrating intention should not be necessary.  The judge agreed with Merck's linguistic analysis of the derogation, but indicated that it should be considered in the light of the overall objectives (as outlined in the earlier case) and that such analysis did not explain the purpose of the notification requirement.  Further, there may be situations in which the patent holder would not object to parallel imports.  He therefore indicated his agreement with Sigma's arguments.

The second issue related to the identity of the person who sends the notification.  In this case, Sigma was the potential infringer, but Pharma XL sent the notification.  The judge indicated that he did not believe this to be problematic in this case, particularly as Sigma and Pharma XL are members of the same group of companies, with Pharma XL being in charge of regulatory affairs and Sigma dealing with imports.  Further, Pharma XL would be obliged to disclose the identity of the importer and so the proprietor could still have taken action.

The third issue related to the identity of the person to whom the notification was sent.  MSD BV was not the patent proprietor or his beneficiary, although it was a related company.  However, the individual to whom the notification was sent acted in patent matters for the group as a whole and so had the authority to assert the patent and had the notification been sent elsewhere, it would have been passed to this individual for a decision.  Further, 90% of the numerous notifications received a year are sent to this individual and are then acted upon.  The judge therefore suggested that there was a real issue as to the meaning of the term "beneficiary."

The Court of Appeal decided to refer the above three issues to the Court of Justice of the European Union, on the grounds that the law is not acte clair, that the Specific Mechanism has not been considered previously by the Court of Justice and  that it will continue to be relevant until 2019.  The parties have been invited to draft questions for the court's consideration.

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: Spain's Further Challenges to the Unitary Patent Regulations

Following on from their previous challenge to the adoption of the unitary patent system on the basis of the concept of enhanced cooperation, and as eventually dismissed by the Court of Justice of the European Union (CJEU), Spain and has launched further challenges; this time directed to Regulations underpinning the Unitary Patent System.

The further challenges have been directed at the unitary patent Regulation, and the translation Regulation.

The unitary patent Regulation is objected to as:

• Having been established on the basis of a right granted by the EPO -- being a body not subject to judicial review;

• Lacking legal basis due to the absence of measures guaranteeing uniform protection, and not being supported by an act of the European Union;

• Representing a misuse of power through the use of enhanced cooperation;

• An infringement of the provisions of the TFEU, and being contrary to the Meroni case-law, concerning the delegation of powers within the EU, in relation to the renewal fee provisions;

• A misapplication of the Meroni case-law in relation to the delegation of powers concerning administrative tasks to the EPO.

Turning to the translation Regulation, this is objected to as:

• Infringing the principle of non-discrimination due to the potential detriment of non-English, French or German speaking persons;

• Lacking legal basis due to its manner of regulating translation requirements in the event of a dispute;

• Infringing the principle of legal certainty;

• Misapplying of the Maroni case-law in delegating aspects of compensation and translation to the EPO;

• Infringing the principle of the autonomy of the EU due to the Regulation's introduction being dependent upon entry into force of the UPC Agreement.

Initial opinion is that the likelihood of at least some aspects of these actions succeeding is good, and that this is likely to open the door to further negotiation between the member states of the EU.

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.

For additional information regarding this topic please see:

• "Member States Sign Agreement to Establish Unified Patent Court," February 21, 2013
• "Parliament Approves EU Unitary Patent Package," December 19, 2012
• "European Parliament Adopts Draft Regulations on Unitary Patent," December 12, 2012
• "Unitary Patent & Unified Patent Court," December 12, 2012
• "Progress for Single European Patent and Litigation System," November 12, 2012
• "EU Patent Is Finally Born," July 2, 2012
• "European Parliament Approves Enhanced Cooperation Procedure to Create Unified EP Patent System," March 1, 2011
• "Several EU Members Push for Unified Patent System," December 30, 2010
• "Europe Takes Step Closer to Single EU Patent and Patent Court," February 24, 2010

News from Abroad: UK Court of Appeal Upholds Invalidity of Enantiomer Patent

The "Obvious to Try" Test Is Overused in Assessing Obviousness

The UK Court of Appeal Decision in Novartis AG vs Generics (UK) Ltd (trading as Mylan), provides insight into the UK court's approach to judging the validity of patents relating to enantiomers of biologically active compounds.  UK Patent No. 2,203,040 to Novartis AG (and the associated Supplementary Protection Certificate (SPC)) protected rivastigmine, a drug used for the treatment of Alzheimer's disease.  The Court of Appeal held the patent to be invalid on the ground of obviousness and criticised the over-reliance on the "obvious to try" test for assessing obviousness.

The Patent

A chiral compound exists as two or more non-superimposable, mirror-image chemical structures, the alternative structures being known as enantiomers.  Rivastigmine is the (-)enantiomer of the chiral carbamate compound, N-ethyl-3-[(1-dimethylamino)ethyl]-N-methylphenyl-carbamate.  UK Patent No. 2,203,040 claims rivastigmine.  The compound is marketed in the UK by Novartis as Exelon^®, and is used for the treatment of Alzheimer's disease.

The High Court Decision

The High Court assessed whether it would have been obvious to a skilled person to select RA₇, resolve it into its individual enantiomers, and then use the (-) enantiomer as a medicinal product for the treatment of Alzheimer's disease.

A racemic mixture (RA₇), a mixture of the (+) and (-) enantiomers of N-ethyl-3-[(1-dimethylamino)ethyl]-N-methylphenyl-carbamate, was known at the priority date of the Patent and had been identified as a potential treatment for Alzheimer's disease.

The UK High Court therefore held that it would have been obvious to select the racemic mixture, RA₇, to resolve it into its individual enantiomers, and to use the claimed (-) enantiomer for the treatment of Alzheimer's disease.  The Patent and associated SPC were therefore found to be invalid.

The Court of Appeal Decision

On appeal, Novartis argued that the High Court erred in its assessment of obviousness.  Novartis argued that that it would not have been "obvious to try" and resolve RA₇ into the individual enantiomers, nor would there have been any expectation that the claimed (-) enantiomer would possess improved biological activity compared to the (+) enantiomer.

The Court of Appeal criticised over-reliance on the obvious to try test in assessing inventive step.  The Court of Appeal acknowledged that it might be appropriate when assessing inventive step to ask whether it was obvious to try a particular route with a reasonable expectation of success.  However, the Decision emphasized that such assessment is secondary to the statutory question of whether an invention is obvious:

This is another case in which a patentee defending his patent has attempted to analyse a single multi-faceted question ("was the invention obvious?") by chopping it up into a series of sub-questions, and then treating each of the sub-questions in isolation.  . . .  [T]hat is the wrong approach.

In the present case it was clear that the prior art disclosed a group of compounds, including RA₇, that were potentially useful in treating Alzheimer's disease.  Biological data published in the prior art also showed that RA₇ was an obvious candidate for further development.  The skilled person was also well aware of the common practice at the priority date to attempt to resolve racemic compounds at an early stage of the drug development process and that there would likely be practical benefits associated with such resolution.

On this evidence the Court of Appeal upheld the judgement of the High Court and the patent was held invalid.

Conclusions

Earlier UK Court of Appeal decisions (Generics (UK) Limited v. Daiichi Pharmaceutical Co Ltd and H Lundbeck A/S v. Generics (UK) Limited) held patents relating to the biologically active enantiomers escitalopram and levofloxacin were non-obvious.  However, evidence in these cases indicated that there were particular problems with resolving the enantiomers at the relevant priority date.  The evidence in the present case indicated that there were no problems encountered in resolving RA₇ and that resolution could be achieved using conventional techniques.

The present Decision might suggest that obtaining patent protection for single enantiomers in the UK is likely to prove difficult if the enantiomer was easily resolved from a known racemic mixture.  If data can be produced that demonstrate practical difficulties with isolating an enantiomer from a racemic mixture or an unexpected therapeutic effect associated with the claimed enantiomer then objections of obviousness may be overcome.

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: Lilly Successfully Defends Zyprexa Compound Patent In Australia

By Todd Shand --

On 15 March 2013, the Australian Federal Court upheld Eli Lilly's patent for the active compound in their highly successful product ZYPREXA®.  Lilly successfully defended the validity of the patent against a wide-ranging attack by the well-known generic pharmaceutical manufacturer Apotex.  Wrays is pleased to have been able to work together with Ashurst Australia in achieving this outcome for Eli Lilly.

The compound in question, olanzapine, was encompassed by an earlier Eli Lilly patent -- a 'genus patent'.  However, olanzapine was not explicitly disclosed in the earlier patent, and was argued to have superior properties to those compounds that were explicitly disclosed.  The later patent, in such a situation, is commonly known as a 'selection patent'.  Apotex cited the genus patent against the novelty of Eli Lilly's olanzapine, thereby providing the Australian Court with the opportunity to provide certainty on the status of selection patents in Australia.  However, the Court expressly declined to do so, deciding the issue of novelty in favour of Lilly based on standard novelty principles around the quality of the prior disclosure.  Nonetheless, the decision provides a useful example of how established selection patent principles would be applied to the patent in question:  should such principles apply, the patent would be valid.

The decision provides some welcome commentary on the interplay between two key concepts of inventive step law in Australia, at least in the context of the Patents Act 1952.  The key concepts are the starting point of the inventive step inquiry (which the court confirmed was the same concept as the "problem to be addressed") and the common general knowledge.  Apotex submitted that the two concepts are distinct -- that the starting point may involve information that is not part of the common general knowledge in Australia.  However, the Court clearly disregarded knowledge that did not form part of the common general knowledge as "irrelevant to the question of inventive step," and rejected the universal applicability of the "problem-solution" approach to inventive step.

Interestingly, and somewhat unusually in the context of generic-innovator patent disputes, the issue of infringement was very much alive in this case.  The claims of the patent identify olanzapine by way of a name only (no chemical structure appears in the claim to the compound), and it was agreed that the name used was not the name that would be generated for the compound by strict adherence to the nomenclature principles set down by the International Union of Pure and Applied Chemistry (IUPAC).  However, elsewhere in the specification, the name used in the claim was clearly associated with a chemical structure that unambiguously represented olanzapine.  The Court expressly rejected any approach that required the claims to be construed in isolation from the specification as artificial, finding that a skilled addressee would clearly identify olanzapine as the compound claimed, and thus finding that the Apotex products infringed Eli Lilly's patent.

Mr. Shand is a Director of Wrays, and he practices in a number of industry areas, including life sciences & biotechnology and pharmaceuticals.

This article was reprinted with permission from Wrays.

News from Abroad: Broadening of UK Bolar Defence

On 26 February 2013, the UK government announced a proposed change to the Patents Act to exempt clinical and field trials, as well as "health technology assessments," e.g., tests to obtain data to support assessment by the National Institute for Health and Clinical Excellence (NICE), for any new drugs from any claim of patent infringement.

Currently, the so-called Bolar defence provides that conducting tests for obtaining data to support applications for the approval of generic pharmaceutical products is not a patent infringement.  The defence extends to consequential practical requirements such as importing or manufacturing the pharmaceutical product to be used in those tests.

The Bolar defence does not apply if the tests are being conducted to provide data to support an application for approval of a new drug.  Whilst the Patents Act provides a defence to those conducting research for experimental purposes, this has been construed narrowly by the UK Court and has been found not to apply to clinical trials and tests involving new drugs.  This limited exemption has been viewed as a barrier to innovation within the pharmaceutical industry as companies are unable to undertake proper and necessary clinical trials within the UK without running the risk of an action for patent infringement.

The UK Intellectual Property Office conducted an open consultation on the Bolar defence and received an overwhelmingly positive response supporting a broadening of it.  The broadening of the defence to include new drugs will no doubt help the UK life sciences industry remain at the cutting edge of innovation.

The UK Intellectual Property Office will seek to implement the changes into the UK Patents Act by the end of 2013.  We will report further, once the revised wording of the Act has been finalised.

For additional information regarding this topic, please see:

• "UK Government Considers Broadening Bolar Exemption," November 19, 2012

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: Bill to Diminish Term of Patents for Medicaments

In January, the Mexican Senate published a Bill adding article 23 bis to the Industrial Property Law (IP Law).  This Bill intends to establish a "special" life term for patents claiming a substance or a mix of substances regulated by article 221, sections I to III of the Health Law; that is:  drugs, active ingredients and raw materials related to drugs.

According to this Bill, the 20 years life term for patents claiming such subject matter would start from the date of filing of first patent application abroad (priority date), instead of the filing date in Mexico, as currently set forth by the IP Law, which could reduce life term up to one year.

We consider that this Bill contravenes International Treaties adopted by Mexico related to Intellectual Property, mainly as it means an arbitrary shortening of the life term of a particular kind of patents, which is privative and would be considered unconstitutional.

Partners and Associates of the Olivares & Cia firm through diverse associations of which they are members will follow up and oppose this Bill and any other one against a proper IP System and International Treaties adopted by Mexico.

This article was reprinted with permission from Olivares & Cia.