4 min read

FemTech is surging around the world with new start-ups and technology entering the marketplace every day, but what’s going on Down Under?

Need for FemTech

As of June 2019, just over half of Australia’s population faced complicated genetic, physiological and hormonal factors making them prone to and more severely affected by certain conditions in comparison to the other half of the population.

Conditions such as heart diseases, osteoarthritis, cancers, strokes and autoimmune diseases present in women differently and pose considerable health risks. 

While FemTech is rapidly growing in Australia, increased health technology options are still needed to support Australian women. This has become even more apparent during the pandemic where existing inequalities in healthcare for women have been laid bare. 

Research is currently well placed in Australia with the Australian Government announcing they will be investing $354 million over the next four years to support the health and wellbeing of Australia’s women, including funding for cervical and breast cancer, endometriosis and reproductive health.

Current market snapshot

FemTech in Australia is still relatively new and unchartered territory. No official study has been conducted about Australian FemTech companies, however, the rise of new FemTech companies and products is undeniably on an upward trajectory.

The Women’s Health Summit 2021 hosted by the Royal Australian and New Zealand College of Obstetricians and Gynaecologists highlighted issues and deficiencies in the Australian healthcare system about health equity for women; access to mental health, contraception, abortion, sexual health and reproductive services; preventative approaches to chronic diseases; and areas in the medical industry where data about women lack.

Australian companies

FemTech typically spans across medical devices, digital health applications and direct to consumer products. Even though medical related digital health applications have only entered the market within the last decade, they are fast becoming the front runner for providing women with access to crucial information about medical conditions, including their diagnosis, treatment and management. Their popularity, which has reached new heights, is primarily due to their accessibility and ease of use.

The following Australian companies have redesigned, reinvented and recycled technology to benefit the health of women:

Menstrual pain

Transcutaneous electrical nerve stimulators (TENS) have typically been used for musculoskeletal pain, such as chronic back pain or knee joint arthritis.

Ovira, a female owned start-up had other ideas for TENS and have developed a non-invasive and instant period pain relief through their device, Noha. The Noha device sends low-level pulses of electric vibrations to the abdomen to block pain signals from being sent to the brain.


Since their conception, menstrual products have made their way from rags to riches. Starting off from cloth, bandages, cotton and wool in the 1800’s to disposable pads, winged pads, and tampons in the 1900’s, menstrual products have come a long way.

Modibodi, are at the forefront of menstrual technology and provide reusable and sustainable leak-proof period apparel that replaces the need for disposable products such as panty liners, tampons, pads, and incontinence products.

Juju, a socially responsible and environmentally conscious company manufactures Australia’s only made menstrual cup.

Payment solutions for the adult industry

Businesses and workers operating in the sex industry find themselves facing discrimination and often struggle to get finance or financial services.

Intimate.io, a blockchain startup, has taken this issue into their own hands. Intiamte.io is focused on solving issues inherent in the adult industry by establishing a cryptocurrency to operate as a digital payment option for adult or sexual products, services or offerings.

Fertility solutions

Despite major technological advancements in IVF, the success rates of IVF still remain very low.

Life Whisperer, an AI focused company, has been using AI to increase the chance of pregnancy through IVF by identifying morphological features that constitute a healthy embryo.

Future of FemTech Down Under

With women comprising over 50% of the population, these emerging companies have a huge opportunity to improve the health and wellbeing of millions of Australians. We expect the Australian FemTech market to continue to grow with local start-ups and from the expansion of international FemTech companies.

It is encouraging to observe the recognition by the Australian Government of the need for better understanding of pressing health challenges faced by women and the injection of money into the women’s health sector to combat some of the challenges.

Companies like Ovira, Modibodi, Juju, Intimate.io and Life Whisperer continue to break boundaries and use technology to find solutions to age old women’s health issues.

Shelston IP are proud supporters of FemTech, assisting FemTech businesses to protect their innovative new products and develop and implement intellectual property strategies to achieve a sustainable competitive advantage.

Authored by Connie Land and Allira Hudson-Gofers

4 min read

Females make up half of the population of the world, but many of the issues they have to deal with, from menstruation to menopause, have often been considered taboo subjects. In fact, until very recently, medical technology and devices for women have been considered niche.

For many years, medical technology and products have historically been developed by men, tested on men and for men, with women expected to adapt. As a result, many diagnoses in women are still undetermined, and it takes several years longer to establish comparable diagnoses in women than in men.

The rise of trailblazing innovators and entrepreneurs creating, designing and developing products and apps for women has started a women’s health revolution by lifting health taboos around the world and giving rise to a global “Femtech” industry worth many billions.

What is Femtech

Femtech, also called female technology, is a newly recognised health sector that relates to technology such as mobile apps, wearables, diagnostic tools and software that is specifically geared towards the needs of women.

Opportunities in Femtech sectors

Today, Femtech accounts for more than 200 start-ups worldwide, many of which have been founded and led by women. 

Numerous spaces and new opportunities in areas such as sex and reproduction, menstruation, fertility, and pregnancy have emerged as age-old issues are being addressed by the unification of modern technology and a focus on women’s health.

While the Femtech industry is still relatively young and underfunded, it is predicted that the industry will grow exponentially in the coming years. Revolutionary steps are continually being taken to balance out gender disparities in the healthcare industry, propelling the agenda of Femtech into the modern world.

In fact, the topic of Femtech has been searched more than ever previously recorded and is on an upwards trajectory.

(Graph obtained from Google trends. Numbers represent search interest relative to the highest point on the chart for the given region and time. A value of 100 is the peak popularity for the term. A value of 50 means that the term is half as popular.)

The shift towards women’s health has also coincided with the next wave of wearable tech products prompting an explosion of wearable technology focused on women’s health, for example, wearable smartwatches to track mensuration and pregnancy and temperatures trackers to identify fertility phases.

On the other hand, the menopause market is an area of enormous opportunity as technology is lacking and largely unexplored. While all women will experience menopause at some point, the availability of products to assist wth tracking symptons is poor, including analogue charts, and very little technology exists for treating symptoms. For that reason, we expect to see this area thrive in the future.

Ongoing challenges in Femtech

While the medical technology and device industry is shifting a considerable amount of time and effort towards women’s health, the industry still faces many challenges.

Breaking down barriers, taboos and getting health data into the hands of those who can utilise it has been a real hurdle within the industry. A particular challenge within Femtech is securing funding. In essence, this requires overcoming the hurdle of pitching female specific products to mostly male investors which solve a problem they don’t understand and can’t relate to.

Other challenges include:

  • Receiving public support about subjects people are less likely to talk about.
  • Fewer researchers in women health fields mean fewer people to apply for grants.
  • Concerns about trust, security and privacy and fear of repercussions if sensitive data was released.

Future of Femtech

The future of Femtech is bright as the awareness of female-oriented health and technology continues to gain momentum, while the taboo around women’s health dissipates.

So far we have only seen the tip of the iceberg in female-focused technology. Notably, the developments in AI and the Internet of Things have largely contributed to the rise of Femtech and will continue to do so. Only recently have tech juggernauts, Fitbit and Apple, developed technology aimed at women’s health. In April 2018, Fitbit unveiled a woman focused smartwatch which allows women to track their menstrual cycle, followed by Apple in June 2019, who added a reproductive health tracking feature to their operating platform.

According to a report by research consultancy Frost & Sullivan, the value of the industry is increasing rapidly. It was estimated that the Femtech industry was worth US$200 million in 2018 and will skyrocket to a potential worth of US$50 billion by 2025.


As Femtech continues to pave the future, we will continue to explore other aspects of Femtech in Australia and Femtech in relation to Intellectual property through a series of focused articles.

Authored by Connie Land and Allira Hudson-Gofers

3 min read

Following a cacophony of dire warnings and lobbying over the past decade from the Australian biotechnology and medical sectors, and the sudden sharp focus of middle Australia on the critical importance of onshore manufacturing facilities such as those capable of mRNA vaccine production, the Federal Government has announced the introduction of a $206.4m patent box for Australian medical and biotechnology industries as part of the 2021-2022 Federal Budget handed down on 11 May 2021.

Named quite literally after a tick box historically present on income tax forms, a patent box provides tax incentives designed to encourage companies to commercialise and manufacture patented technology locally. From 1 July 2022, Australia’s proposed patent box is slated to tax income derived from eligible patents at a concessional corporate tax rate of 17%, rather than the standard corporate tax rate of 30%, or 25% for small and medium enterprises (SMEs).

While the specifics are yet to be established, the patent box is proposed to apply to income derived from granted Australian patents in the medical and biotechnology sectors filed after the budget announcement (ie, after 11 May 2021), providing that at least a portion of the research and development (R&D) of the technology occurred in Australia. The following example was provided with the Federal budget papers: A company selling a patented product makes $175 million in net income directly attributable to the patent. If 80% of the R&D associated with the patented product occurred in Australia, then 80% of the income (ie, $140 million) would enjoy the concessional 17% tax rate. 

The measure is intended to incentivise Australian companies to invest in and perform their R&D, commercialisation and manufacturing of patented technologies onshore. It has been warmly received by the Australian biotechnology sector with Lorraine Chiroiu, CEO of AusBiotech, stating that the organization whole-heartedly commends the initiative: “This tax incentive will address the gap that leaves our IP vulnerable, retain home-grown IP, and support Australian innovators and manufacturers. It will make the commercialisation of IP and manufacturing in Australia more genuinely viable for businesses.”

Cochlear’s CEO, Dig Howitt, has similarly commented: “Incentivising companies of all sizes to keep their intellectual property and manufacturing in Australia will generate substantial economic benefits through royalties, licence fees, tax revenues, supply chains, jobs, and capital investment.”

CSL CEO Dr Andrew Nash concurs, stating, “CSL welcomes the introduction of a patent box which will help decrease the flow of intellectual property from local medical research going overseas. It will drive the growth of advanced manufacturing jobs, capital intensive investment and sovereign capacity in medical technology and biotechnology manufacturing.”

A number of countries already have patent box regimes, including the UK, Belgium, Spain, France, the Netherlands, Luxembourg, Switzerland, and China. Australia’s patent box is set to follow the Organisation for Economic Co-operation and Development (OECD)’s guidance on patent boxes to meet internationally accepted standards.

The Government has indicated that it will consult with industry on the design of the patent box and explore whether the regime should be extended to include clean energy patents. Lobbying from that sector is already well underway.

On a technical note, several years typically elapse between patent filing and patent grant. Accordingly, it could be some three or four years before the patent box regime begins to provide significant benefit. Patent grant can, however, be brought forward by various means including requesting early national phase entry in Australia followed by expedited examination. If you require advice on this issue, Shelston IP would be happy to help.     

Authored by Karen Heilbronn Lee, PhD and Allira Hudson-Gofers

In July 1969 the United States of America put two men on the moon. Years later in 2011, the then Prime Minister of Australia, Julia Gillard, stood before US Congress and recalled the same moon-landing memory and with acquiescence wept that “Americans could do anything!” Today, the US seems to have entered, what was once described in an episode of Seinfeld as, “Bizzaro world” – Donald Trump is in the White house and, even more astonishingly, researchers are unable to protect what have been described judicially as “truly meritorious” and “ground breaking” innovations in the diagnostics and personal medicine space. Today it is Australia that reigns supreme over the US, as the Federal Court in Sequenom, Inc. v Ariosa Diagnostics, Inc. [2019] FCA 1011 (27 June 2019) confirmed that a non-invasive method of detecting fetal characteristics and abnormalities is patent eligible subject matter in Australia!

The set up

The inventors of the patent-in-suit, Australian Patent No 727919, in the name of Sequenom, Inc., discovered that the cell-free fractions of a pregnant woman’s blood contain surprisingly large amounts of cell-free fetal DNA (cffDNA). Traditionally, this portion of the plasma or serum was discarded as medical waste. This pioneering discovery led to the development of the claimed non-invasive method to determine fetal characteristics and abnormalities, such as Down syndrome. Ariosa Diagnostics Inc, who sought to revoke Sequenom’s Patent, conducts and licenses others to conduct a non-invasive prenatal diagnosis test, marketed under the name “Harmony”, which Sequenom claims infringes their patent.

The significance of the Australian Sequenom decision has been fuelled by the corresponding US case where the claims of the Sequenom’s patent were found to be patent ineligible because they were held to be directed to naturally-occurring matter. The ensuing detrimental impact on US diagnostics industry has subsequently resulted in a proposal for changes to the patentable subject matter legislation, which is currently being considered by US congress.

Issues and findings

Under Australian law, patent eligibility is guided by the principles of the High Court’s decision in National Research Development Corporation v Commissioner of Patents(‘NRDC’) [1959] HCA 67. In that landmark decision, it was held that subject matter was considered patent eligible if it was “an artificially created state of affairs” having “economic significance”.

Ariosa’s case relied heavily on the approach that proved successful in the US, namely that the claims cover a mere discovery, that being the presence of cffDNA, which can be detected in the plasma or serum of pregnant women, and that the end result of each claim is not an artificially created state of affairs. Ariosa further submitted that the claims involve nothing more than the use of well-known techniques to detect cffDNA in maternal blood.

Ariosa also suggested that the Court should follow the US position, which they suggested was in harmony with the Australian Myriad decision. Judge Beach’s response was an emphatic, “I hardly think so”. In fact, in considering the Australian High Court Myriad decision, Beach J emphasised the difference between the gene product claims considered in Myriad and the method defined in the claims of Sequenom’s patent. In particular, he stated that “in nature, the presence of cffDNA in the maternal blood has not and cannot be detected without human action. Accordingly, unlike the claims considered in Myriad, the invention claimed adds to human knowledge and involves the suggestion of an act to be done which results in a new result, or a new process”.

The Court also agreed with Sequenom that the substance of the claimed method is distinct to simply the identification of a natural phenomenon, namely the presence of cffDNA in maternal blood. This, the Judge said, is made clear by the patent specification, which explains that the invention offers a new approach for non-invasive prenatal diagnosis, which only occurs through human intervention and provides a significant advantage over existing fetal DNA detection methods, thus producing a result possessing economic utility.

Consistency with foreign law

Given the intense spotlight that has illuminated patentability issues in the US for diagnostic methods in recent times, the consistency of the Australian decision and the corresponding UK proceedings between Ariosa and Sequenom (Illumina, Inc v Premaitha Health Plc[2017] EWHC 2930), will likely go unnoticed. Those, however, looking for controversy in the conflicting Australian/US findings should look no further than Judge Beach’s swatting away of the issue by stating that the conclusion reached in the US decision is problematic because of the US Court’s dissection of the claims into their constituent parts, which is contrary to Australia’s NRDC and Myriad decisions, – end of story.


This decision, and the recent decision in Meat & Livestock Australia Limited v Cargill, Inc [2018] FCA 51, make it clear that claims directed to practical applications of naturally-occurring phenomena, including gene sequences, used in methods of diagnosis and prognosis are patent eligible subject matter in Australia. This will come as a welcome relief to the diagnostics and personal medicine industry and can be considered as “one small step” forward for Australian patent law but also, hopefully, “one giant leap” that influences beneficial change to the patent eligibility laws in the US.

In GlaxoSmithKline Consumer Healthcare Investments (Ireland) (No 2) Limited v Generic Partners Pty Limited [2018] FCAFC 71, the Full Federal Court has found that terms used in claims cannot be interpreted beyond their plain meaning. Such a decision emphasises that great care is required when drafting claims that contain words or phrases that have a well-established meaning in the art.

The primary decision

GlaxoSmithKline Consumer Healthcare Investments (Ireland) (No. 2) Limited (GSK) commenced a proceeding against Apotex Pty Ltd (Apotex) and a separate proceeding against Generic Partners Pty Ltd for anticipated infringement of the claims of Australian Patent No. 2001260212 (the 212 Patent).  Apotex and Generic Partners brought cross-claims against GSK seeking to revoke claims 1 to 6, 8 to 11, 13 and 14 of the 212 Patent.

The 212 Patent relates to pharmaceutical preparations of paracetamol, with claim 1 directed to a bilayer tablet with a defined dissolution profile, which is determined through the use of a particular recited apparatus: “the USP type III apparatus, reciprocating basket”.

The problem for GSK is that claim 1 defined an apparatus that was not a standard apparatus included in the United States Pharmacopeia (“USP”).  The USP type III apparatus includes a reciprocating cylinder, not a basket.  Both the consistory clauses and an example in the Patent, however, referred to the dissolution testing apparatus as “the USP type III apparatus (reciprocating basket)”.

The primary judge (Beach J) found that, while the reference to “basket” would have been understood by the skilled addressee as an error, the claim could not be re-written using construction to interpret “basket” to mean “cylinder” as:

  • no integer of the claim was ambiguous or uncertain;
  • there was no inconsistency between the body of the specification and a claim integer;
  • the invention still worked if “basket” meant “basket”;
  • there was no case of an erroneous stipulation of an underlying scientific theory upon which the invention proceeded;
  • a patent cannot be construed with all the latitude and commercial massaging that is permissible for a commercial contract; and
  • rules of benevolent construction which would strive to construe the 212 Patent in a way not claimed could not be applied. Construction that re-writes the claim is in effect construing what ought to have been rather than what is, and it is not permissible to adopt a method of construction that gives a patentee what it might have wished or intended to claim rather than what it did claim.

In GlaxoSmithKline Consumer Healthcare Investments (Ireland) (No. 2) Limited v Apotex Pty Ltd [2016] FCA 608 (31 May 2016), the Federal Court found the claims of the 212 Patent to be valid but not infringed.

The appeal to the Full Federal Court

On Appeal, GSK’s asserted that the primary judge should have found that claim 1 of the 212 Patent refers to a compendial USP type III apparatus with a reciprocating cylinder.  GSK submitted that, having found that the reference to “basket” would be understood by the skilled addressee to be an error, his Honour should have given effect to this finding and interpreted the claim accordingly.  GSK contended that the primary judge erred in holding that to construe claim 1 in the manner which the skilled addressee would interpret it, would require his Honour to “re-write the claim”.

In a cross appeal, Apotex and Generic Partners asserted that the claims of the 212 Patent were not fairly based and that a best method of performing the invention was not disclosed in the specification.

With regard to claim construction, the Full Federal Court framed the issue as “whether, if the court were to also interpret the claim so as to correct the mistake, it would be re-writing the claim or merely interpreting it through the eyes of the skilled addressee” in accordance with precedent established by, e.g., Catnic Components Limited & Anor v Hill & Smith Limited [1982] RPC 183 (HL) and Kirin-Amgen Inc v Hoechst Marion Roussel Ltd (2004) 64 IPR 444.

The Full Federal Court found that for claim 1 to be interpreted as GSK forwarded, namely as relating merely to an USP type III apparatus, then it would not have been necessary to recite anything other than “USP type III apparatus” in the claim.  Further, the Full Federal Court explained that there could have been no problem with language since the language was not describing anything new.  Thus, for GSK to succeed in its appeal, the Full Federal Court stated that the words “reciprocating basket” are either interpreted to mean “reciprocating cylinder” or simply ignored, either of which “involved impermissible re-writing of the relevant claims”.  The Federal Court found “[t]his is a case in which … the language of the claim must be understood to mean what it actually says”.

With regard to fair basis and best method, the Full Federal Court confirmed the findings of the primary judge, namely that the claims of the 212 Patent were fairly based and that the best method requirement was met.  The Full Federal Court found that “A complete speciation may still ‘describe the invention fully’ without explaining why the invention works. After all, the inventor, who presumably believes that the invention described works, may not understand why it works. But this does not prevent him or her from obtaining patent protection for the invention”.  The Full Federal Court also found that “the best method was disclosed, albeit at a level of generality that did not include the more detailed but inessential manufacturing and production information described in the MAA [marketing authorisation application] applicable to the commercial embodiment”.


The good news for patentees is that this case would appear to be a rather unique case and that, as shown by the Full Federal Court’s analysis, there may be leeway in the case law for “correcting” an error in claim terms when describing something new.  However, in describing something established in the art, the choice of words must be carefully considered.  The Full Federal Court decision also highlights that a specification may describe the invention fully without explaining why the invention works, and that a low degree of generality may be sufficient to satisfy the best method requirement.

Authored by Chris Bevitt

Shelston IP wishes to congratulate Professor Hala Zreiqat from Sydney University, who has recently been named NSW Premier’s Woman of the Year.  She is currently Professor of Biomedical Engineering, where she founded the Tissue Engineering and Biomaterials Research Unit in 2006.

Shelston IP has been providing IP-related services to Sydney University for many years, and has been involved in drafting and prosecution the majority of the patent applications naming Professor Zreiqat as an inventor. The innovative technologies developed by Professor Zreiqat and her teams relate to biocompatible ceramic materials and uses in applications such as bone regeneration, for improving the stability of implantable medical devices, and as synthetic implantable scaffolds. The particular biocompatible ceramic materials covered by her patent applications include materials such as Baghdadite, Strontium-doped Hardystonite, and 2-phase materials comprising metal oxide doped Hardystonites.

Shelston IP is proud to be associated with Sydney University and eminent scientists such as Professor Zreiqat.

Authored by Gareth Dixon, PhD and Serena White, DPhil

In this, the first of a trilogy of articles investigating specific areas of Australian Patent Office examination practice, I consider how the High Court’s decision in D’Arcy v Myriad Genetics Inc [2015] HCA 35 (7 October 2015) (the Myriad decision) has been interpreted to render all non-naturally-occurring cDNA compositions patent ineligible. I also question the legitimacy of this current Patent Office practice in view of patent eligibility standards applied to other gene-based inventions.


When the High Court of Australia ruled against the patentability of isolated human genes in October 2015, biotechnology stakeholders were on tenterhooks as to how the decision would be interpreted and its impact on Australian biotechnology innovation.

It is now history that the Australian Patent Office’s narrow interpretation of the Myriad decision manifested only as an exclusion to patentability of isolated gene sequences encompassing “genetic information” that occurs in nature. Isolated naturally-occurring material other than genes, such as proteins and micro-organisms, remain unquestionably patent eligible under Australian law.  This contrasts with the US situation, where the Supreme Court “Myriad decision” resulted in a patentability exclusion for all isolated naturally-occurring materials.

Remarkably, however, up until the Myriad decision’s first anniversary, the Australian Patent Office implemented examination practice that excluded from patentability certain gene-based inventions that only came about as a result of human activity.  These inventions included codon-optimised nucleic acid sequences, and double-stranded interfering RNA compositions. The Patent Office’s rationale at the time was that although such compositions do not occur in nature, they encompass “genetic information” that is naturally occurring. This practice was reconsidered by the Patent Office in Cargill Incorporated v Dow AgroSciences LLC [2016] APO 43 (5 July 2016) (the Cargill decision), which confirmed the patentability of codon-optimised nucleic acid sequences) and Arrowhead Research Corporation [2016] APO 70 (13 October 2016) (the Arrowhead decision), which confirmed the patentability of interfering RNA compositions.

Australian Patent Office practice, however, currently maintains a patentability exclusion for all cDNA inventions.  It is, however, arguable whether this practice is consistent with the Patent Office’s own precedents set down by the Cargill and Arrowhead decisions.

cDNA: the current Patent Office position

According to the Australian Patent Office Manual of Practice and Procedure, if “genetic information” in a man-made molecule, for example cDNA, is the same as that in the genome, the molecule is not patent eligible”.  cDNA appears to have been specifically excluded from patentability because the Myriad decision states in obiter at paragraph 55:

The information stored in “… the sequence of nucleotides coding for the mutated or polymorphic BRCA1 polypeptide is the same information as that contained in the DNA of the person from which the nucleic acid was isolated. …. That characteristic also attaches to cDNA, covered by the claims, which is synthesised but replicates a naturally occurring sequence of exons”.

Based on this paragraph, which specifically concerns a prognostic invention and not the expression of a protein, the Patent Office has applied a broad exclusion to the patentability of all cDNA inventions.

cDNA consists of a nucleotide sequence of human-made fused exons (the exons encoding a protein), without intervening non-coding introns.  It is well known by molecular biologists that the removal of introns confers a multitude of advantages not exhibited by the corresponding genomic sequence, including ease of cloning and manipulation, and superior protein expression levels. Moreover, it is well understood that intron sequences include genetic information. This is a fact clearly identified by the Myriad decision at paragraph 201, where it is stated “[i]ntrons do not encode a protein but they contain information that helps regulate the utilisation by the cell of the encoded information in the exons”. Based on this point alone, it would seem clear that if a cDNA invention relates to the expression of a protein, cDNA could not be considered as encompassing the same information as that which occurs in nature.

Patent Office practice inconsistencies?

Most recently, I challenged the Patent Office’s position in a case where the claimed cDNA demonstrably exhibited commercial advantages over the corresponding genomic sequence. The Patent Office acknowledged that the claimed cDNA provided advantages which distinguished it from genomic genetic information. The relevant claims, however, were ultimately rejected because the Examiner formed a view that “[t]he key issue is that in the absence of an appropriate vector, isolated cDNA is in substance genetic information which encodes the same polypeptide as the genomic sequence” The Examiner also stated that the benefits of “efficiency and ease of expression or quantity of expression, arise as a result of a man-made expression construct and expression in a transgenic host”. This approach is arguably inconsistent with the position of the Patent Office in the Cargill decision, where the patentability of codon-optimised DNA was confirmed based on its utility. Relevantly, all of the points raised by the Examiner above, to support a case of patent ineligibility, also clearly apply to patent eligible codon-optimised DNA.

Specifically in the Cargill decision, the Delegate stated that codon-optimisation is an important man-made variation to the naturally occurring sequence, notwithstanding that such sequences code for the same protein as a naturally occurring sequence, because it facilitates optimal production of the encoded protein in certain cells above that which could be expected from the naturally-occurring sequence.  Such benefits, however, only come about as a result of an expression construct and expression in a transgenic host, which are the identical circumstances that confer the commercial advantages associated with cDNA.

Similarly, in the Arrowhead decision, it was found that the double-stranded nature of the claimed RNA compositions played a significant role in the working of the invention.

In both Cargill and Arrowhead cases, it was the advantages and economic utility of the claimed nucleotide sequences which provided basis for their patentability. However, the advantages and economic utility of cDNA sequences, which are directly comparable to codon-optimised sequences, are currently insufficient to confer patentability to cDNA inventions.


It is difficult to understand how Applicants claiming cDNA inventions that confer significant economic advantages over naturally-occurring sequences are receiving fair treatment from the Patent Office given that codon-optimised DNA sequences, which exhibit similar advantages, are patent eligible. Hopefully, in the future the Patent Office will have the opportunity to consider patent eligibility of cDNA in greater detail to ensure that consistent examination practice is clearly applied.

Authored by Michael Christie, PhD

Earlier this year Jagot J of the Federal Court of Australia ordered Generic Health to pay Bayer $25,437,966 in damages plus interest to compensate for lost revenue caused by generic product sales infringing its patent covering the oral contraceptive Yasmin (see our previous report at: https://www.shelstonip.com/news/30m-for-infringement-of-bayers-australian-yasmin-patent-a-small-jurisdiction-with-big-benefits/). This damages award exceeded the amount of $19,891,858 which Bayer offered to accept in settlement of the proceedings, in an offer to compromise served under rule 25.14(3) of the Federal Court Rules 2011 (Cth) on 6 May 2015.

In a decision published last week (Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd [2017] FCA 428 (4 May 2017)), Jagot J ordered that Bayer is entitled to recover its costs of the damages aspect of the proceedings on the higher “indemnity” scale (rather than the usual “party-party” scale). This indemnity costs order was made because of Generic Health’s failure to accept Bayer’s offer to compromise, which represented more favourable terms (ie, less money) than the judgment Bayer ultimately obtained. This means that it will be entitled to recover all actual costs reasonably incurred after the expiry of its offer to compromise. The party-party scale usually results in a costs award of around 50-75% of actual costs. The indemnity costs order covers a 19-month period involving intensive work on its substantial evidence and submissions and the trial hearing regarding the quantification of its damages claim. The costs can therefore be expected to be substantial.

The Federal Court Rules 2011 (Cth) provide a process under which a party to a proceeding can make a “without prejudice” offer to settle the proceeding. A party who does not accept such an “offer to compromise” and obtains a judgment on less favourable terms must pay the other party’s costs on an indemnity basis, and is not entitled to its own costs, from the time after the offer to compromise expires. The offer to compromise is served on the other party to the proceeding but is not filed with the Court and cannot be mentioned in any court documents, unless and until a party asks the Court (after determination of the claims and cross-claims) to make costs orders in light of the other party’s failure to accept the offer.  An offer of compromise is therefore similar to a Calderbank offer, although much briefer.

Bayer’s offer of compromise was served 2 months before its first affidavit was filed in the damages enquiry phase of the proceeding and almost 19 months before the conclusion of the damages hearing on 20 December 2016. Jagot J identified a series of circumstances – such as Generic Health’s sophistication and resources as a generic pharmaceutical company and consequent knowledge of pricing and other implications of its generic launch – that supported her conclusion that the offer was reasonable and failure to accept it should lead to an indemnity costs award:

“The objective circumstances indicate that Generic Health, if it had wished to do so, could have sufficiently informed itself about its overall exposure to liability for infringement of Bayer’s patent when the offer was made for the purpose of deciding whether or not the offer represented a genuine compromise (which it did). This is so despite the fact that, when the offer was made, Bayer had not quantified its claim for damages or filed its evidence in support. 

…[H]ad it wished to do so, Generic Health would have had no real difficulty in assessing its maximum total liability for the infringement and had no reason to suppose that Bayer, if forced to litigate, would claim anything materially less than that maximum amount. The fact that Generic Health sought no explanation from Bayer as to how it had calculated the amount of the offer, when the precision of the amount indicates that it resulted from a calculation, supports my conclusion that Generic Health was not interested in whether the offer represented a genuine compromise.

…Generic Health [which subsequently made a lower settlement offer, after seeing Bayer’s evidence] was prepared to chance its hand to save itself some $6 million by seeing if Bayer could discharge the onus of proof on it under s 115 [of the Patents Act 1990 (Cth)] to establish that the patent specification in its unamended form had been framed in good faith and with reasonable skill and knowledge.

This decision is salient reminder of the potential significance of offers of compromise (and similar Calderbank letters) in Australian intellectual property litigation. In particular, careful consideration needs to be given to the time at which such offers are made and received, and the extent to which they might need to analysed by the receiving party to properly assess their reasonableness.

Authored by Duncan Longstaff

In the recent Federal Court case of Insight Radiology Pty Ltd v Insight Clinical Imaging Pty Ltd ([2016] FCA 1406), Insight Radiology was unsuccessful in its appeal against the registrar’s decision refusing registration of its application for trademark registration of the following composite mark:

Insight Clinical enjoyed a substantial victory in its claims that Insight Radiology’s conduct constituted trademark infringement, passing off and misleading or deceptive conduct under the Australian Consumer Law.

Insight Clinical has been operating a medical imaging business in Western Australia since 2008 and now has seven clinics. It has been using the word marks INSIGHT and INSIGHT CLINICAL IMAGING, as well as the following composite mark:

Despite its use since 2008, Insight Clinical waited until October 2012 to register the INSIGHT CLINICAL IMAGING word mark and above composite mark for radiology services in Class 44 of the Nice Classification.

Prior to that, in December 2011, Mr Pham, the sole director of Insight Radiology, applied to register the INSIGHT RADIOLOGY composite mark in his own name for radiology services in Class 44. At that time, Mr Pham’s company was known as AKP Radiology Pty Ltd and he traded under the name of Leeton Diagnostic Imaging. His trademark application included a voluntary endorsement to the effect that any registration would not confer exclusive rights to use of the words ‘insight radiology’ in the state of Western Australia.

Use of the INSIGHT RADIOLOGY word mark and the INSIGHT RADIOLOGY composite mark commenced in approximately March 2012 in New South Wales and then Tasmania. Mr Pham was alerted to Insight Clinical’s trademark application being accepted based on prior continuous use by IP Australia in December 2012 and, subsequently, in May 2013, he received a letter of demand from Insight Clinical’s attorneys.

Despite this, Mr Pham continued trading and, in June 2013, changed his company name from AKP Radiology Pty Ltd to Insight Radiology Pty Ltd. In July 2013, after acceptance of his application to register the INSIGHT RADIOLOGY composite mark and during the opposition period, he assigned this trademark application to Insight Radiology Pty Ltd.

The Federal Court proceedings involved two aspects. First, an appeal by Insight Radiology against the registrar’s decision. Second, an action by notice of contention brought by Insight Clinical for trademark infringement, passing off and misleading or deceptive conduct under the Australian Consumer Law.

With regard to the opposition appeal, Davies J disagreed with the delegate’s finding on the Section 58 ownership ground that the respective composite marks were substantially identical. Her Honour considered that the differences between the respective marks gave a total impression of dissimilarity (although they were found to be deceptively similar).

Further, despite arguments to the contrary by Insight Clinical and the court finding that Mr Pham did not himself have the requisite intention to use the INSIGHT RADIOLOGY composite mark at the time of filing his trademark application, the subsequent assignment to Insight Radiology Pty Ltd was held to be valid. That company became the applicant under the Trademarks Act and did have the intention to use this mark which effectively cured Mr Pham’s lack of intention.

However, Davies J upheld the Section 60 reputation ground of opposition finding that, while Insight Clinical only conducted its business in Western Australia, it received referrals from interstate practitioners and the evidence demonstrated that the parties operated in a national industry. This was sufficient to establish the required reputation in its trademarks outside Western Australia at the relevant date and, because of this reputation, it followed that use of the INSIGHT RADIOLOGY composite mark would be likely to cause deception or confusion.

Given this finding, her Honour held that Insight Radiology’s geographical endorsement on its application did not overcome the Section 60 ground of opposition.

Davies J also found that Insight Radiology succeeded on the Section 42(b) contrary to law ground of opposition on the basis that use of the INSIGHT RADIOLOGY word and composite marks was in contravention of the Australian Consumer Law and constituted passing off.

With regard to the second aspect (infringement, Australian Consumer Law and passing off), as Insight Radiology acknowledged that its trademarks were deceptively similar to the registered marks of Insight Clinical, it had to try and rely on one of the defences to infringement.

Mr Pham failed in his bid to rely on the own name defence because it was found that he did not act in good faith when he changed the company name from AKP Radiology Consultants Pty Ltd to Insight Radiology Pty Ltd in June 2013, and continued to use the INSIGHT RADIOLOGY trademarks in the face of knowledge of the later-filed marks of Insight Clinical and the receipt of the letter of demand.

While her Honour had found in favour of Insight Clinical on the Section 60 ground of opposition, she also considered whether Insight Radiology would hypothetically have been able to establish a defence to infringement based on honest concurrent use of the INSIGHT RADIOLOGY word mark and composite mark. Given the actions of Mr Pham in the face of knowledge of use of the INSIGHT CLINICAL marks, her Honour questioned the commercial honesty of use by Insight Radiology and determined that discretion would not have been exercised in its favour.

Finally, Davies J briefly considered Insight Radiology’s position under the Australian Consumer Law and passing off. Having found for Insight Clinical under the Section 60 ground of opposition, her Honour had little difficulty in finding Insight Radiology’s conduct was misleading and deceptive and also constituted passing off. This was not mitigated by the different geographical locations where the parties have been conducting business because they operate in a national industry and Insight Radiology had not distinguished its services by the branding it adopted.

Additionally, her Honour also found Mr Pham liable as a joint tortfeasor and for aiding and abetting Insight Radiology’s wrongful use of the trademarks.

This decision has a number of useful aspects for practitioners, including its exploration of how a questionable claim to ownership of a trademark application may be cured by assignment, as well as the threshold level of reputation required for the Section 60 ground of opposition. It also serves as a timely reminder of the need for honesty of adoption of a trademark, both for the purposes of obtaining registration of the mark and as a defence to trademark infringement.

This article was first published in January 2017 in the World Trademark Review.

Authored by Kathy Mytton