7 min read

Australia’s Federal Court Decision, Merck Sharp & Dohme Corp. v Sandoz Pty Ltd [2021] FCA 947, concerns a patent claiming two pharmaceutical substances having different first regulatory approval dates; one less than 5 years after the patent filing date and one more than 5 years after the patent filing date.  The decision considers whether the first regulatory approval more than 5 years after the filing date can be considered the first approval for PTE-eligibility purposes. 

Patent Term Extensions (PTEs) in Australia

Australia’s Patents Act provides patent term extensions (PTEs) to account for the delays that can occur when obtaining regulatory approval for pharmaceuticals (see s70-79A of Patents Act 1990).  A PTE can last for up to five years and is available when the following requirements are met:

  • the patent, in substance, discloses and claims a pharmaceutical substance per se, or a pharmaceutical substance when produced by recombinant DNA technology;
  • goods containing or consisting of the pharmaceutical substance are included in the Australian Register of Therapeutic Goods (ARTG);
  • the PTE application is made within six months after the later of (a) the date the patent was granted and (b) date of the first inclusion in the ARTG; and
  • the first regulatory approval for the pharmaceutical substance occurred more than five years after the filing date of the patent.

The length of a PTE is equal to the period between the filing date of the patent and the date of the first regulatory approval, reduced by five years.  A patent cannot be extended more than once.

Background

Merck Sharp & Dohme Corp. v Sandoz Pty Ltd [2021] FCA 947 concerns the patent term extension granted in connection with Australian patent 2002320303, which covers two pharmaceutical substances for the treatment of diabetes: sitagliptin and a composition containing sitagliptin and metformin.  The patent was filed on 5 July 2002 and its ordinary term was therefore set to expire on 5 July 2022

Sitagliptin was first included in the ARTG on 16 November 2006, i.e. less than five years after the filing date. 

The composition containing sitagliptin and metformin, however, was first included in the ARTG on 27 November 2008, six years, four months and 22 days after the filing date of the patent.  The patentee, Merck Sharp Dohme (MSD), applied for a PTE based on the regulatory approval of the sitagliptin/metformin composition and the term of the patent was extended until 27 November 2023

Sandoz contended that the extension of term was invalid and sought rectification of the register to reflect a patent expiry date of 5 July 2022

Reliance on the Ono decision

This decision relies heavily on the recent decision, Ono Pharmaceutical Co, Ltd v Commissioner of Patents [2021] FCA 643.

As recently reported here. Ono addressed the issue of “earliest first regulatory approval” in the context of a patent covering two blockbuster cancer drugs; the patentee’s drug and a competitor’s drug.  The competitor’s drug received regulatory approval before the patentee’s drug and the issue was therefore which regulatory approval date was relevant for deciding the patentee’s PTE request.

In Ono, Justice Beach noted that PTEs are intended to provide an effective patent life for pharmaceutical products.  His Honour reasoned that the drug which is the subject of the PTE application is intended to be the drug of the patentee, not that of a third party.  His Honour also commented that it is for the patentee to nominate the pharmaceutical substance for the purposes of requesting a PTE (which can be any pharmaceutical substance that is in substance disclosed and claimed in the patent). 

Justice Beach concluded that the patentee’s own first regulatory approval (rather than the competitor’s earlier first regulatory approval) could form the basis of the request. 

The “earliest first regulatory approval date”

In the present case, MSD argued that “the earliest first regulatory approval date” means either:

(a) the earliest first regulatory approval date of any substance claimed by the patent which is included on the ARTG and which received regulatory approval at least 5 years after the patent’s filing date (MSD’s primary construction), as nominated by the patentee (based on Ono), or

(b) the earliest first regulatory approval date of all substances claimed by the patent which are included on the ARTG and which received regulatory approval at least 5 years after the patent’s filing date (MSD’s alternative construction).

That is, MSD’s construction required any regulatory approvals for pharmaceutical substances less than 5 years after the patent filing date to be disregarded for the purpose of assessing PTE eligibility. 

If MSD’s construction were to be followed, the ARTG approval of sitagliptin could be ignored (being less than 5 years after the patent’s filing date) and PTE eligibility could be determined based on the date of inclusion in the ARTG of the combination of sitagliptin and metformin (i.e. the first regulatory approval which is at least 5 years after the patent’s filing date). 

Sandoz contended that “the earliest first regulatory approval date” means the earliest regulatory approval date of any pharmaceutical substance in the patent – this corresponds to the date of inclusion in the ARTG of sitagliptin.  Following this line of argument, if regulatory approval is secured for any pharmaceutical product claimed by the patent less than 5 years after the patent filing date, no patent term extension can be obtained. 

Reasoning and discussion

MSD submitted that all of the factors which Beach J considered relevant in Ono are equally relevant to the present case. Justice Jagot disagreed. 

Her Honour took the view that the absurdity identified in Ono was the fact that a patentee could be granted an extension of term of zero merely because the earliest first regulatory approval date would be that of an unrelated company relating to the same substance.  In the present case, however, it was the patentee who had obtained regulatory approval for both substances covered by the patent.

Her Honour noted:

It is one thing to conclude that it is absurd for a patentee to be denied any term of an extension due to an earlier regulatory approval by another unrelated party of which the patentee may not have known and over which the patentee would have had no control. … It is another to conclude that it would be absurd for a patentee to be denied any term of an extension due to an earlier regulatory approval by the patentee or its agent of which the patentee must have known and over which the patentee had control. In such a case, the patentee, by definition, will not have been delayed in obtaining regulatory approval for a substance or the substance in its patent for at least five years.” 

Justice Jagot also commented on the crucial presence of the word “earliest” in s77(1) of Patents Act 1990, which sets out how to calculate of an extension of term. 

Her Honour was of the opinion that it is clear that the legislature considered a delay of less than five years after a patent filing date for obtaining regulatory approval for a pharmaceutical substance covered by the patent was acceptable and did not require a capacity for an extension of term of the patent, commenting:

There is no reason to infer that the legislature intended that a patentee with a patent disclosing and claiming more than one pharmaceutical substance intended that there could be an extension of term if the patentee obtained inclusion of one or more pharmaceutical substances in the ARTG within five years of the date of the patent but then also obtained inclusion of one or more pharmaceutical substances in the ARTG five years or more after the date of the patent. Provided one pharmaceutical substance has been included in the ARTG within five years of the date of the patent, the patentee has had the benefit of the monopoly afforded by s 13 of the Patents Act within the period of delay the legislature considered acceptable.”

Conclusion

Justice Jagot agreed with Sandoz, taking the view that the regulatory approval date of sitagliptin (less than 5 years after the patent filing date) was to be used in calculating the length of the PTE.  Her Honour thus concluded that the extension of term of MSD’s patent is zero and ordered that the Register be rectified as sought by Sandoz.

Implications

This decision confirms that, if a patent covers more than one pharmaceutical substance for which the patentee has obtained regulatory approval, the calculation of the extension of term must be based on the substance that was approved first.  If the approval date of that substance is within five years of the filing date of the patent, no extension of term will be granted.

Patent Applicants should therefore consider separating substances that have received (or are expected to receive) regulatory approval into multiple patents, for example by pursuing each substance in its own divisional patent application.  This will ensure that each patent is able to enjoy the maximum extension of term that is available to it based on the substance that it covers.

Authored by Serena White, DPhil and Michael Christie, PhD

6 min read

Ariosa Diagnostics, Inc v Sequenom, Inc [2021] FCAFC 101

The Full Court of the Federal Court of Australia has confirmed that Sequenom’s diagnostic method of detecting fetal DNA in maternal blood is eligible for patent protection in Australia.  The decision highlights the different approaches taken by Australian, European and US authorities when it comes to assessing the patentability of diagnostic methods.

However, the Full Court also found that Sequenom’s patent was not infringed by the importation of results from tests conducted overseas on the basis that the results were information and not a product that could be exploited.

The technology

Sequenom’s patent stemmed from the discovery of cell-free fetal DNA (cffDNA) in maternal blood serum and blood plasma by two researchers from Oxford University. The discovery enabled the development of a non-invasive prenatal test using maternal blood samples. 

The test could be used to determine the gender of an unborn baby, and its susceptibility to certain genetic conditions. Prior to the inventors’ discovery, obtaining a prenatal sample for testing typically involved inserting a needle through the mother’s abdomen or cervix. 

The patent

Claim 1 of Sequenom’s patent defines:

A detection method performed on a maternal serum or plasma sample from a pregnant female, which method comprises detecting the presence of a nucleic acid of foetal origin in the sample.

In the first instance decision, the Federal Court of Australia found that the use of the “Harmony” prenatal diagnostic test by Ariosa Diagnostics Inc, and by its licensees, Sonic Healthcare Limited and Clinical Laboratories Pty Ltd, infringed certain claims of Sequenom’s patent. On appeal, Ariosa challenged the validity of the claims and the finding of infringement.

Validity

Ariosa argued that the primary judge erred in finding that the claimed method is a “manner of manufacture” as required under the Patents Act because what is claimed is a mere discovery of a naturally occurring phenomenon. In a related submission, Ariosa contended that, properly understood, the end result of each claim is mere information.  The human-mediated “detection”, Ariosa argued, is no different from the discovery that cffDNA is detectable. Ariosa submitted that in substance there is no application of the discovery by simply claiming the detection of what has been discovered to exist. 

In support of their arguments, Ariosa cited D’Arcy v Myriad Genetics Inc [2015] HCA 35, in which the High Court found that claims defining isolated nucleic acids encoding mutant or polymorphic BRCA1 polypeptides were in substance directed to naturally occurring genetic information, which is not patentable subject matter.

The Full Court rejected Ariosa’s approach, finding that it disaggregated the discovery of cffDNA in maternal plasma or serum from the method used to harness that discovery. Although fetal nucleic acid occurs in nature, the Full Court found that the substance of the invention is not cffDNA itself, but the identification of that particular nucleic acid as a part of a method:

Unlike the position in Myriad, claim 1 is not, as a matter of substance, directed to genetic information, but to a method involving the practical application of a means for identifying and discriminating between maternal and foetal nucleic acid. Although foetal nucleic acid occurs in nature, the substance of the invention is not cffDNA itself, but the identification of that particular nucleic acid as a part of a method. It is impermissible to disaggregate the integers of the method to point only to the cffDNA as the “invention”. Identification of the substance of the invention does not involve disregarding material aspects of the claim language. The invention as claimed is not merely output, but the detection process which yields an output. This is the very type of subject matter considered to fall on the correct side of the line between discovery of a scientific fact or law of nature and invention (at [155]).

Their Honours observed that an invention may reside in an abstract idea that is put to a useful end, even though the way of putting it to that end can be carried out in many useful ways, all of which are otherwise known. While the mere discovery of a natural phenomenon is not eligible for a patent, the practical application of that discovery may very well be patentable subject matter.

The Full Court concluded that the invention defined by claim 1 of Sequenom’s patent ”falls firmly within the concept of a manner of manufacture as that term is to be understood having regard to the authorities, being an artificially created state of affairs of economic utility” (at [166]).

Ariosa’s other grounds of attack, namely, that the claims were invalid for lack of sufficiency and lack of fair basis, were also unsuccessful.

Infringement

Before conducting the Harmony Test in Australia, Ariosa’s Australian licensees, Sonic Healthcare and Clinical Laboratories, collected blood samples from pregnant women in Australia and sent those samples to Ariosa in the US. Ariosa then conducted the Harmony Test in the US and provided the results, in the form of a report made available by a file sharing platform, to Sonic Healthcare and Clinical Laboratories in Australia. 

The exclusive rights of a patentee to exploit an invention will ordinarily be infringed by importing the product of a patented process, even when that process is carried out overseas. This is because Australia’s Patents Act defines the term “exploit” as including:

where the invention is a method or process – use the method or process or do [acts including importing] in respect of a product resulting from such use.

The primary judge found that the method was infringed when it was performed in Australia, which was not in dispute in the present case. However, the primary judge also found that Sonic Healthcare’s and Clinical Laboratories’ “send out” model amounted to an infringement of Sequenom’s claims because it used a method that would have infringed the claims if conducted in Australia.

The Full Court disagreed, noting that the Patents Act does not provide a definition of the term “product”. Their Honours preferred a construction of the word “product” in the context of the definition of “exploit” which recognises that not all patented methods or processes will lead to a product. The Full Court observed that the broad definition applied by the primary judge could have consequences that are not sensible – a person who has heard the outcome of the Harmony Test, which may be as simple as “it’s a girl!”, and who then flies to Australia with that information may infringe the patent by importing that outcome.

The Full Court also noted the incongruity that would result from extending the patentee’s monopoly to encompass test results that are not them themselves patentable:

A claim to mere information is not patentable …. The fact that such information is derived from a patentable process or method cannot render the information itself patentable. In those circumstances, we do not consider that the word “product” in para (b) of the definition of “exploit” should be interpreted as extending the patentee’s monopoly to information which could not itself constitute patentable subject matter since it would have the unintended and odd consequence of permitting the patentee to obtain patent protection in respect of subject matter that has long been held to be unpatentable (at [269]).

Accordingly, because the imported test results are themselves information, and not a “product” as such, Sonic Healthcare’s and Clinical Laboratories’ send out model did not infringe Sequenom’s patent.  

Final comments

The Full Court’s decision highlights the different approaches taken by Australian, European and US authorities when it comes to assessing the patentability of diagnostic methods.  The corresponding patent application was found to be valid in the UK (Illumina, Inc v Premaitha Health Plc [2017] EWHC 2930), albeit under a different eligibility test, but was deemed invalid by the US Court of Appeals for the Federal Circuit (Ariosa Diagnostics, Inc. v Sequenom, Inc. 788 F.3d 1371 (Fed. Cir. 2015)).

In Australia, courts will construe a claim in its entirety, rather than considering each feature individually. While the mere discovery of a natural phenomenon may not be eligible for a patent in Australia, the practical application of that discovery may very well be, even where the application uses known methods.

The decision also confirms that not all patented methods will give rise to a “product” that can be exploited in an infringing act.

Ariosa and Sequenom have the option of applying for special leave to appeal the decision to the High Court. 

Authored by Karen Heilbronn Lee, PhD and Michael Christie, PhD

1 min read

IAM Patent 1000: The World’s Leading Patent Professionals 2021 has again Highly Recommended Shelston IP for Patent Prosecution.

Shelston IP has not only been Highly Recommended by IAM Patent 1000 for Patent Prosecution, we have also been Recommended for both our Litigation and Transaction work.

Our attorneys also continue to be ranked with Michael Christie, PhD, Paul Harrison and Greg Whitehead listed as Highly Recommended for Patent Prosecution together with Chris Bevitt for his Transaction work.

Congratulations to all our ranked attorneys.

Authored by Chris Bevitt, Michael Christie, PhD, Paul Harrison and Greg Whitehead

5 min read

Australia’s Federal Court Decision, Ono Pharmaceutical Co, Ltd v Commissioner of Patents [2021] FCA 643, overturns the Patent Office Decision, Ono Pharmaceutical Co., Ltd. et al [2020] APO 43, in which the Patent Office had found that the substance with the first regulatory approval date for the purpose of the patent term extension request was a competitor product.  In a Judicial Review of the Patent Office decision, the Federal Court found instead that the substance with the first approval date was the patentee’s own, later-approved product.

Patent Term Extensions (PTEs) in Australia

Australia’s Patents Act provides patent term extensions (PTEs) to account for the delays that can occur when obtaining regulatory approval for pharmaceuticals.  A PTE can last for up to five years and is available when the following requirements are met:

  • the patent, in substance, discloses and claims a pharmaceutical substance per se, or a pharmaceutical substance when produced by recombinant DNA technology;
  • goods containing or consisting of the pharmaceutical substance are included in the Australian Register of Therapeutic Goods (ARTG);
  • the PTE application is made within six months after the later of (a) the date the patent was granted and (b) date of the first inclusion in the ARTG; and
  • the first regulatory approval for the pharmaceutical substance occurred more than five years after the filing date of the patent.

The length of a PTE is equal to the period between the filing date of the patent and the date of the first regulatory approval, reduced by five years.  A patent cannot be extended more than once.

Background

Ono Pharmaceutical Co, Ltd v Commissioner of Patents [2021] FCA 643 concerned a request to extend the term of Australian patent 2011203119.  The patent claims encompassed two blockbuster cancer drugs: Merck Sharp & Dohme’s KEYTRUDA and the patentee’s OPDIVO, both of which received regulatory approval in Australia, but on different dates.  Thus, the question at issue was which regulatory approval date was relevant for deciding the patentee’s PTE request.

To cover all of its bases, the patentee simultaneously filed two PTE requests: one based on the competitor product, KEYTRUDA, which had received regulatory approval on 16 April 2015, and another based on its own product, OPDIVO, which had a regulatory approval date of 11 January 2016.  The PTE request based on KEYTRUDA was accompanied by a request for an extension of time. 

From the patentee’s perspective, the request based on OPDIVO was preferred as it would result in a longer extended term (an additional 8 months, 26 days). 

The Overturned Patent Office Decision

Initially, the Patent Office refused the PTE request based on OPDIVO, finding that KEYTRUDA was included on the ARTG first and therefore should form the basis of the request.  The patentee disagreed and requested to be heard.

At the Patent Office hearing, and as previously reported, the patentee’s request for a PTE based on OPDIVO was again refused (Ono Pharmaceutical Co., Ltd. et al [2020] APO 43).

The Federal Court Decision: Ono Pharmaceutical Co, Ltd v Commissioner of Patents [2021] FCA 643 (11 June 2021)

Justice Beach of the Federal Court observed that PTEs are “designed to remedy the mischief of a shortened period for an effective monopoly that has been caused by delays in obtaining regulatory approval”. 

Justice Beach framed the question at issue as follows:

“… it is whether an application for an extension must be filed within 6 months of the first inclusion in the ARTG of goods containing or consisting of any pharmaceutical substance falling with the claims of the patent:

(a)          where the goods were those of the patentee (the applicants’ position); or

(b)          irrespective of whether the goods were those of the patentee, that is, they could be the goods of a third party that had nothing to do with the patentee and, moreover, might be a competitor [the position taken by the Patent Office]”

Answering this question involved consideration of the intended meaning of the relevant provisions and the history of the legislation, including the 1997 Explanatory Memorandum (EM), the second reading speech to the Bill that became the 1998 Amendment Act (the speech) and the now-repealed s 76A of the Patents Act 1990. 

Justice Beach noted that PTEs are intended to provide an effective patent life for pharmaceutical products and the reference to “product” was “clearly not that of a stranger let alone a competitor”.  His Honour rhetorically asked how the legislation would provide an effective patent life if the product on the ARTG triggering the start of the extension was not that of the patentee, but rather that of a stranger or indeed a competitor, concluding, “[t]hat would not provide an “effective life” for the patentee at all”.

Justice Beach also determined that it is for the patentee to specify the pharmaceutical substance for the purposes of requesting a PTE (which can be any pharmaceutical substance that is in substance disclosed and claimed in the patent). 

His Honour reasoned that the drug which is the subject of the PTE application is intended to be the drug of the patentee, not that of a third party.  His Honour considered that the Patent Office’s interpretation of the law would place an unreasonably onerous burden on the patentee who would need to review each and every ARTG listing to identify those that contain a pharmaceutical substance falling within the scope of the claims (to the extent possible, noting also the dearth of information provided in ARTG public summaries), and to determine whether another relevant substance was previously listed on the ARTG but later removed, as can occur in certain circumstances. 

Justice Beach acknowledged, however, that the Patent Office’s approach was understandable in light of the text being construed and that a Delegate of the Patent Office is not as free as a Judge to reject any perceived ordinary meaning of the legislation by reason of manifest absurdity or unreasonableness. 

Conclusion

Justice Beach agreed with the patentee and favoured a liberal rather than a literal construction of the legislation, commenting in summary that a liberal construction can fit within the ordinary meaning of the statutory language and is consonant with the legislative purpose.

It was therefore concluded that the term of the patent should be extended based on the regulatory approval date of the patentee’s own pharmaceutical substance, OPDIVO, even though KEYTRUDA was approved earlier. 

Implications

This decision lifts the burden for patentees of the need to monitor the ARTG for approval of third party drugs.  In circumstances where a patent covers more than one approved pharmaceutical substance, the decision implies that a PTE request does not have to be based on the substance that was approved earliest. 

Authored by Serena White, DPhil and Michael Christie, PhD

5 min read

Introduction

IP Australia is providing free extensions of time of up to 3 months if a deadline cannot be met due to the effects of COVID-19.  As reported here https://www.shelstonip.com/news/covid-19-update-ip-australia-now-extended-streamlined-relief-measures-31-january-2021-provide-certainty-holiday-period/, the period for requesting such an extension currently ends on 31 January 2021 with the prospect of the period being further extended. 

A streamlined process has been implemented for requesting COVID-19-related extensions.  No declaratory evidence or fee is required; all that is needed is to check the relevant box on IP Australia’s eServices system to declare that the deadline cannot be met due to disruptions from the pandemic (equating to circumstances beyond control).  Although these COVID-19 extensions of time have so far been routinely allowed, they are nonetheless subject to the Commissioner’s discretion. 

New decision from IP Australia

A recent decision from IP Australia, Shell Internationale Research Maatschappij B.V. v Yara International ASA [2020] APO 55, http://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/APO//2020/55.html, relates to a request for a COVID-19 extension in the context of a patent opposition.  It provides a reminder that care is required when requesting COVID-19 extensions at IP Australia, both in terms of the timing of the request and the reasoning.

Shell Internationale Research Maatschappij B.V. (the Opponent) filed a Notice of Opposition and, at the same time, requested a COVID-19 extension of 3 months for filing the Statement of Grounds and Particulars (SGP), which was due to be filed within 3 months of the Notice of Opposition. 

In accordance with usual procedure under Australian law, Yara International ASA (the Applicant) was afforded the opportunity to comment on the Opponent’s request for an extension of time.  The Applicant opposed the Opponent’s request for an extension of time. 

The Opponent’s submissions

The Opponent filed a declaration which provided a general overview of the COVID situation in the UK and at Shell.  The declaration noted that, as a consequence of the pandemic, the responsible in-house attorney had commenced working at home in April 2020, solely with the use of a laptop, without access to printers or desktop monitors, and that he did not have access to numerous physical documents that were required for the opposition.  The declaration also reasoned that, due to COVID-19, obtaining mandates and financial approvals for the opposition at Shell had become more difficult. 

The Applicant’s submissions

The Applicant, however, noted that the Opponent had filed two rounds of third-party observations at the EPO on the corresponding European application.  The Applicant argued that, although another Shell attorney had filed those third-party observations, the Opponent had not provided any reason why that attorney could not have prepared or assisted with the preparation of the SGP or why the task could not have been delegated to the Australian representative.  The Applicant pointed out that preparation of the SGP does not need expert witnesses and that the amount of time required to prepare the SGP is significantly less than that required for the preparation of evidence.  Furthermore, the Applicant argued that an undue delay would lead to an extended period of uncertainty for the Applicant and would not be in the public interest. 

Decision to grant a shortened extension and reasoning

The Commissioner commented that it was “not the existence of the pandemic, but rather the specific impacts on the responsible person, that must be taken into consideration”. 

The Commissioner considered that the extension request was “largely prospective and based on conjecture of circumstances that might arise in the future”.  The fact that the extension request had been filed at the same time as the Notice of Opposition did not work in the Opponent’s favour.  In this regard, the Commissioner observed that “if a party can anticipate on-going delays, and even quantify those delays in requesting an extension upfront, then presumably they can also plan and take action to mitigate their impact”.  The Commissioner expressed concern that “a party obtaining an upfront extension and working to an extended deadline may not be as diligent in completing their work, or as motivated to consider and implement mitigating strategies that could enable them to meet the original deadline”.

In the concluding remarks, the Commissioner adjudged that, whilst there were circumstances that had impacted on the Opponent’s ability to complete the SGP in time, the request was made at the beginning of the period for preparing the SGP when the impacts and the extent of delay were uncertain.  Further, the Commissioner was not satisfied that the Opponent had provided a sufficiently detailed disclosure of the circumstances to justify the request for an extension at that time, including the reasons why no strategies were available to mitigate the impacts. 

On balance, the Commissioner decided to allow an extension but the length of the extension allowed was less than the 3 months requested.

The Commissioner noted that the decision to allow the extension of time of course does not preclude the Opponent seeking a further extension based on current circumstances that may prevent completion of the SGP by the extended due date.

Conclusion

Whilst a shortened extension was granted in this circumstance, this decision serves as a stark reminder that IP Australia’s COVID-19 streamlined extension provisions are not a simple free-for-all.  An element of discretion does apply. 

A requestor must be able to provide genuine reasons and evidence to justify the grant of the extension and the timing of the request can also be of significance. 

In addition, it is worth mentioning IP Australia’s warning that a false declaration could put the validity of an IP right at risk.

For more information, or if you have been affected by the COVID-19 pandemic and require assistance with your IP Rights, please contact us. 

Authored by Serena White, DPhil and Michael Christie, PhD

3 min read

Gliknik, Inc. v CSL Behring Lengnau AG [2020] APO 46 (“Gliknik”) concerned a patent application for engineered proteins intended for use as replacements for intravenous immunoglobulin.  The application included claims directed to methods of treating autoimmune or inflammatory diseases as well as a Swiss-style claim directed to the same diseases.  Gliknik, Inc. opposed the application on several grounds including that the specification did not sufficiently disclose the invention as claimed.

The standard for “sufficient” disclosure was raised in Australia following the commencement of the Intellectual Property Laws Amendments (Raising the Bar) Act 2012 and its assessment has been approached by the Australian Patent Office with the following two-step enquiry:

  1. Is it plausible that the invention can be worked across the full scope of the claim?
  2. Can the invention be performed across the full scope of the claim without undue burden?

In Gliknik, the Patent Office considered for the first time the plausibility of a Swiss-style claim. Following the principles recently set out by the Full Federal Court in Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2020] FCAFC 116, the Delegate observed that Swiss-style claims confer a monopoly in respect of a method of making a medicament.  They are not product claims, nor are they method of treatment claims – the monopoly extends to the point where the medicament is made.

Nevertheless, Swiss-style claims are purpose-limited in the sense that the medicament resulting from the method is characterised by the therapeutic purpose for which it is manufactured, as specified in the claim.  Unlike method of treatment claims, however, a Swiss-style claim does not require that the therapeutic effect be achieved. Our analysis of Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2020] FCAFC 116, including the court’s construction of Swiss-style claims, is available here.

Having construed the claims, the Delegate in Gliknik then considered whether the plausibility standard of therapeutic effectiveness (for method of treatment claims) differed from that of therapeutic purpose (for Swiss-style claims).  In the absence of Australian jurisprudence, the Delegate turned to UK authorities, and in particular, the principles set out by Sumption LJ in Warner-Lambert Company LLC v Generics (UK) Ltd [2018] UKSC 56.  Although that case concerned the plausibility of efficacy rather than purpose, the Delegate reasoned that, if the efficacy of a product is not plausible, then it would follow that an intention to treat would not be plausible.  The Delegate concluded that substituting the word “efficacy” for “purpose” in Sumption LJ’s comments would not provide any substantial difference to the plausibility analysis.

Turning then to the disclosure of the specification, and the evidence of the common general knowledge in the field, the Delegate found it plausible that the engineered proteins of the invention could effectively treat some, but not all, conditions specified in the claims.  For certain conditions, the specification provided no more than a speculative assertion and so the claims were found to be insufficiently enabled.

This decision shows that the Australian Patent Office will apply a similar standard of plausibility to method of treatment claims as it will to Swiss-style claims. For each type of claim, the disclosure of the specification, supplemented by the common general knowledge, must make the efficacy of the treatment plausible.

Authored by Michael Christie, PhD

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Authored by Michael Christie, PhD and Ean Blackwell

4 min read

Ono Pharmaceutical Co., Ltd. et al [2020] APO 43 (16 September 2020)

Background

Australia’s Patents Act provides a patent term extension (PTE) to account for the delays that can occur when obtaining regulatory approval for a pharmaceutical substance.   The extension can last for up to five years and is available when the following requirements are met:

  • the patent, in substance, discloses and claims a pharmaceutical substance per se, or a pharmaceutical substance when produced by recombinant DNA technology;
  • goods containing or consisting of the pharmaceutical substance are included in the Australian Register of Therapeutic Goods (ARTG); and
  • the first regulatory approval for the pharmaceutical substance occurred more than five years after the filing date of the patent.

The length of a patent term extension is equal to the period between the filing date of the patent and the date of the earliest first regulatory approval, reduced by five years.

The decision

Ono Pharmaceutical Co., Ltd. et al [2020] APO 43 concerned a request to extend the term of a patent covering anti-PD-1 antibodies.  The patent included claims for two blockbuster drugs; Merck Sharp & Dohme’s KEYTRUDA and the patentee’s OPDIVO, both of which received regulatory approval in Australia, but on different dates.  The question at issue, then, was which regulatory approval date was relevant for deciding the patentee’s PTE request.

The patentee hedged its bet, filing two PTE requests; one based on KEYTRUDA, which received regulatory approval on 16 April 2015, and another based on OPDIVO, which received regulatory approval on 11 January 2016.  From the patentee’s perspective, the request based on OPDIVO was preferred as it would result in a longer extended term (an additional 8 months, 26 days).  However, the Patent Office refused that request, finding that KEYTRUDA was included on the ARTG first and therefore should form the basis of the request.  The patentee disagreed and requested to be heard.

In the hearing, the patentee submitted that the “first regulatory approval date” should be the approval date of their own product, OPDIVO.  This, they argued, was consistent the purpose of the extension of term provisions, that being to restore the time lost by patentees in gaining marketing approval, and to compensate the patentee for the additional time, expense and difficulty in developing and commercialising a new drug.

The patentee argued that the reference to “first” regulatory approval in the Act was only important when multiple regulatory approval dates existed for the same substance, such as for different delivery forms (e.g. capsules, gel capsules, tablets, slow-release, different amounts, etc) that manifested in different ARTG registrations.  According to the patentee, it was only logical, given that the regime is intended to be beneficial and remedial, that it can only be about rewarding patentees for their work and, by implication, not the work of others.  If not, the patentee would not receive the full extension of term for their product.

The Delegate accepted that the PTE regime was designed to encourage the development of new drugs, but rejected the patentee’s broader purposive construction of the Act.  Such a construction, the Delegate noted, would encourage companies to develop a substance that is not new and seek regulatory approval as late as possible, secure in the knowledge that a PTE will be granted for the (not new) substance.  According to the Delegate, this type of scheme would not incentivise new drugs. Rather, it would incentivise new extension applications.

The Delegate acknowledged that there is some ambiguity in the words of the Act insofar as they do not say one way or the other whether the relevant pharmaceutical substance is only that belonging to the patentee, or whether it includes other, equivalent substances owned by third parties.  But the Delegate also noted that this ambiguity had been dealt with previously by the Patent Office in G.D. Searle LLC [2008] APO 31.  In that case, the Patent Office held that an application for PTE must be based on the earliest inclusion on the ARTG of a pharmaceutical substance falling within the scope of the claims, irrespective of the sponsor of the goods.  Moreover, in Pfizer Corp v Commissioner of Patents (No 2) [2006] FCA 1176, the Federal Court of Appeals held that “the term of the extension is based on the earliest inclusion, regardless of the identity of the sponsor. It is not open to the Commissioner to calculate the term of the extension only on the basis of goods sponsored by the Patentee.”

The Delegate therefore found that the substance with the earliest regulatory approval date for the purpose of the PTE request was KEYTRUDA, not OPDIVO.  As such, the patentee’s request for a PTE based on OPDIVO was refused.

Conclusion

In circumstances where a patent claims more than one registered pharmaceutical substance, this decision confirms that the earliest registered substance will be used to determine eligibility for a PTE and to calculate the length of the extension, irrespective of whether the registered substance is owned by the patentee or by a third party.  Patentees should therefore be aware of all pharmaceutical substances covered by their claims, not just those they are seeking to commercialise. If a patent application covers more than one pharmaceutical substance, an applicant may be well-advised to file one or more divisional applications to ensure that each registered substance is quarantined within its own patent, thus enabling maximum extensions to be sought for each patent separately.

Authored by Ean Blackwell and Duncan Longstaff

9 min read

Australia’s Full Federal Court recently delivered judgment in an appeal in a significant patent case: Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2020] FCAFC 116.  The case concerned three patents relevant to Mylan’s oral lipid-lowering agent, Lipidil® (fenofibrate).

An enlarged Full Court bench comprising 5 judges (Middleton, Jagot, Yates, Beach and Moshinsky JJ) was appointed to hear and decide Mylan’s appeal.  This was because Mylan sought to clarify the Full Court’s previous statement in Merck & Co Inc v Arrow Pharmaceuticals Ltd [2006] FCAFC 91; 154 FCR 31 that the characterisation of an alleged anticipation as a “suggestion” in relation to the invention, is “not necessarily fatal to a novelty argument”.  Mylan submitted this statement by the Full Court did not countenance “mere speculation” or “the presentation of no more than a reasoned hypothesis” as an anticipatory disclosure.  On this basis, Mylan submitted to the Full Court (unsuccessfully, as explained below) that the trial judge (Nicholas J) had erred in finding that a hypothesis stated in a prior art document relating to a clinical study deprived methods of treatment claims of novelty.

The Full Court’s decision also provided important guidance in relation to the approach taken by Australian courts in considering obviousness, the construction and infringement of ‘Swiss-style’ claims under Australian patent law and the extent to which consistory clauses alone can provide fair basis for a claim.

Method of treatment and Swiss-Style claims lack novelty in light of clinical trial protocol

The Full Court considered whether method of treatment and Swiss-style claims could be anticipated by prior art comprising a protocol for a clinical trial of the claimed method.

Mylan argued that such a protocol could not be novelty-defeating, because at most it identified a hypothesis that required testing, and could not be understood as teaching or recommending that the claimed method be put to clinical use.  The Full Court rejected that analysis and upheld the trial judge’s finding that Mylan’s method of treatment and Swiss-style claims lacked novelty.

The Full Court held that, in assessing novelty, the key question is whether the information disclosed in the prior art is sufficiently specific and complete to be equal to the invention that is later claimed.  If so, then even a protocol for a trial to test the claimed method could be novelty-defeating.  The Full Court acknowledged that, in this respect, Australia’s law on novelty differs from the law applied by UK courts in cases such as Regeneron Pharmaceuticals Inc v Genentech Inc [2012] EWHC 657 (Pat) and Hospira UK Limited v Genentech Inc [2015] EWHC 1796 (Pat), which hold that the prior art must disclose actual achievement of the relevant therapeutic effect to be novelty-defeating.

This aspect of the Full Court’s decision arguably fails to give due consideration to the proper meaning and importance of words such as “treat” and “prevent” in method of treatment and Swiss-style claims.  As Mylan contended, at the stage of disclosing the protocol for a clinical trial, it is not known whether the product or method under consideration does in fact “treat” or “prevent” the particular condition or illness of interest, and there is a significant prospect that it will later prove ineffective or unsafe.  The approach of the Full Court and the primary judge makes clear that the nature and extent of the prior-published clinical trial protocol or other document will be critical in each case.  Those case-specific factual issues will be especially important in future cases, as it would seem a harsh outcome for patentees for statements of unproven hypotheses, theories, ideas or suggestions to anticipate and invalidate (for lack of novelty, putting aside considerations of obviousness which depend on the common general knowledge and availability of prior art) claims to a method that the patentee has subsequently proven effective and safe in “treating” or “preventing” the particular condition or illness.

Obviousness of formulation and method of treatment claims

Australian Courts generally assess obviousness by asking whether, before the priority date, a skilled person presented with the same problem as the patent owner would have been “directly led to try the claimed subject matter with a reasonable expectation of success” (referred to as the “modified Cripps question”).  Historically, that test has been applied in a strict manner by Australian courts, leading a number of patents to be upheld in Australia that have been invalidated on obviousness grounds in other jurisdictions.

Recently, however, Australian courts have adopted a more flexible interpretation of the Cripps test.  This Mylan case continues that trend.  The trial judge held two of Mylan’s patents (one relating to nanoparticulate formulations of fenofibrate, the other relating to methods of preventing or treating retinal damage associated with diabetes by administering fenofibrate) invalid on obviousness grounds, and the Full Court upheld those findings.

The following aspects of the Court’s obviousness analysis are notable:

  • Mylan’s patent for a nanoparticle formulation of fenofibrate included claims which required the use of specified surface stablizers.  The trial judge did not find that the skilled person would have been directly led to select those specific stabilizers with an expectation that they would be effective. Rather, he found that the claimed stabilizers were logical to try and that routine, trial-and-error testing would have demonstrated their suitability.  The Full Court agreed this was sufficient to support an obviousness finding.
  • In relation to Mylan’s method of treatment patent, an expert gave evidence that, before the priority date, his expectation of success with the claimed method would have been less than 50%.  The trial judge held that evidence was not inconsistent with a finding of obviousness, because the Cripps test does not require a numerical assessment.  Again, the Full Court agreed with that analysis.

The test for obviousness applied by Australian courts remains more demanding upon the party seeking revocation than the approach taken by (for example) the European Patent Office or the UK courts.  However, the Mylan decision continues a trend in Australian patent cases towards a more flexible application of the obviousness test that is somewhat closer to the approach taken by the European Patent Office and UK courts.  This serves to emphasise the importance of careful preparation of the obviousness defence in close collaboration with inventors and key expert witnesses.

Defining the scope of Swiss-style claims

The claims asserted by Mylan included Swiss-style claims.  Swiss-style claims are typically drafted in the form “Use of [active ingredient] in the manufacture of a medicament for the treatment of [disease or disorder]”.  They came about from the need to satisfy particular requirements for patentability which formerly applied under the European Patent Convention.  Although these requirements do not exist in Australia, Swiss-style claims are routinely included in Australian patents as their scope is different from that of method of treatment claims, which are also permitted under Australian law.

The Full Court in this Mylan case examined the interpretation of Mylan’s Swiss-style claims, having regard to the decision of the UK Supreme Court in Generics (UK) v Warner-Lambert [2018] RPC 2, and provided guidance on determining the scope of such claims under Australian law.

One of the Swiss-style claims asserted by Mylan recites:

 “Use of fenofibrate or a derivative thereof for the manufacture of a medicament for the prevention and/or treatment of retinopathy, in particular diabetic retinopathy”.

The Full Court confirmed that the claim, if valid, conferred a monopoly in respect of the method or process of making the medicament, and that the method or process is complete upon manufacture.  The monopoly did not extend to a method of treatment – that being the province of method of treatment claims.  The Full Court also confirmed that Swiss-style claims are purpose-limited in the sense that the medicament resulting from the method or process is characterised by the therapeutic purpose for which it is manufactured, as specified in the claim.  The Full Court rejected the “outward presentation” test that was favoured by Lords Sumption and Reed in the UK Warner-Lambert case.

In the first instance decision, the primary judge said that the the crucial question concerning the infringement of a Swiss-style claim was whether the manufacturer had made or will make the medicament with the intention that it be used in the treatment of the designated condition.  On this basis, to prove infringement of a Swiss-style claim, it would not be enough to show that it was “reasonably foreseeable” that a generic product would be put to the use referred to in those claims (although foreseeability could be relevant in the overall analysis).  The trial judge held that, to prove infringement of Swiss-type claims, it would be necessary to show that the generic intended that its product be put to the use referred to in the Swiss-style claims.

The Full Court disagreed with this approach, instead finding that infringement of a Swiss-style claim is concerned with what the allegedly infringing manufacturer has done, not what it intended to do.  That is, not what a generic manufacturer intended, but what the generic product is for.  According to the Full Court, a single factual question arises when considering infringement:  as the product of the claimed method or process, is the medicament for the specified therapeutic purpose?  The question, the Full Court said, is answered having regard to “all the circumstances of the case”.

The Full Court pointed to several such “circumstances” that will be relevant in determining the therapeutic purpose of the medicament as defined by a Swiss-style claim.  First, the court noted that the physical characteristics of the medicament as it emerges as a product of the manufacturing process, including its formulation and dosage, packaging and labelling, and its patient information, will be an important consideration.  So too will evidence of the manufacturer’s actual intention in making the medicament, where such evidence is available.  Both factors are relevant considerations, but neither is determinative.

On the facts of this case (which included “skinny labelling” confining the approved indications of the generic product to indications outside the conditions within Mylan’s method of treatment claims), the Full Court held that Mylan had not proved that Sun’s fenofibrate products were “for” the second medical use covered by Mylan’s Swiss-type claims.

The Full Court also gave consideration to the reasonably foreseeable use or uses to which the medicament would be put after manufacture.  But while a reasonably foreseeable use may be relevant in deciding the therapeutic purpose of a medicament, it is also not determinative:  it might be reasonably foreseeable that a product might be put to a particular use, but it does not necessarily follow that the product, as manufactured, is for that use.

The Full Court agreed with the primary judge that mere suitability of a medicament for a claimed purpose cannot be determinative of the question of infringement of a Swiss-style claim.  The fact that the patent has been granted on the basis of a second medical use means that there are multiple uses to which the medicament could be put.  Evidence of suitability for use was therefore considered ambiguous and could not alone answer the question whether the medicament, as manufactured, is one for the specified therapeutic purpose.

Ultimately, the Full Court found that the Swiss-style claims, if valid, would not have been infringed by the manufacture of Sun’s competing product.  Of particular relevance to the Full Court’s decision was the fact that the competing product could be used in a large number of diseases other than retinopathy.

The decision validates the importance of including both Swiss-style claims and method of treatment claims when protecting a therapeutic use in Australia.  Both types of claim are permitted in Australia, and although their scope is limited to the specified therapeutic use, each will directly capture a different infringer.  In particular, Swiss-style claims provide a more direct avenue than method of treatment claims for pursuing manufacturers of competitive pharmaceutical products, rather than the medical practitioners who perform the treatment.

Consistory clauses may not provide fair basis if too broad 

Mylan’s third patent, relating to an immediate-release micronized formulation of fenofibrate, was found by both the primary judge and the Full Court to be invalid for lack of fair basis.  The Full Court endorsed the primary judge’s reasoning that the disclosure elsewhere in Mylan’s patent specification made clear that the invention was to the immediate release fenofibrate composition and a method for preparing it, whereas Mylan had advanced a construction of a consistory clause and corresponding claims to the effect that the invention extended to any composition of fenofibrate which satisfies the specified dissolution profile.  The Full Court affirmed that, as Sun Pharma had submitted, this is “a paradigm example of claims which travel beyond the matter disclosed in the specification”, amounting to invalidity for lack of fair basis.

The fair basis test considered in this case still applies to Australian patents for which examination was requested prior to 15 April 2013, when the “Raising the Bar” amendments came into effect.  The ‘fair basis’ requirement is generally considered to be a lower standard for patentees than the ‘support’ requirement that replaced it from 15 April 2013, which Australian Parliament expressly intended to align more closely with requirements under European law.  Therefore, if a consistory clause alone will not necessarily provide fair basis, that risk is likely to be even more significant for more recent patents and pending future patent applications required to meet the higher standard of support (such as an “enabling disclosure”).

Authored by Duncan Longstaff and Michael Christie, PhD