More Support for Experimental Use Exception to Anticipation

Hospira Healthcare Corporation v. Kennedy Trust for Rheumatology Research 2018 FC 259 Phelan J
            2,261,630 / infliximab / REMICADE / INFLECTRA

The 630 patent, held by Kennedy Trust, covers the adjunctive use of methotrexate [MTX] and infliximab for the treatment of rheumatoid arthritis [RA] in patients who do not respond fully to MTX alone. Infliximab is only approved for treatment of RA when used in combination with MTX [16]. Kennedy Trust’s licensee, Janssen, markets infliximab for use in combination with MTX under the name REMICADE [18]. Hospira’s infliximab product INFLECTRA, is a biosimilar of REMICADE, sold for the same purpose [18] (and see the product monograph). Hospira brought an action for a declaration that Kennedy’s 630 patent is invalid, and that INFLECTRA would not infringe, while Kennedy brought a counterclaim to the opposite effect [5].

MTX was a popular prior art treatment for severe RA [111], but for some patients — “incomplete responders” — MTX alone did not adequately control their RA. The efficacy of infliximab was also part of the cgk [113], but the duration of effect was limited [11]. It turned out that the combination of MTX and infliximab, as claimed in the 630 patent, exhibited enhanced efficacy over either drug alone as well as a sustained duration of effect [15]. On the facts, Phelan J concluded that this particular combination therapy was not obvious or obvious to try [230].

Hospira argued “an astonishing number and veritable panoply of patent law issues.” [24], including standing, ownership, improper priority, and double patenting plus along with the full range of the usual attacks, including anticipation, obviousness, sufficiency, utility, and overbreadth (and this list isn’t complete). As an academic, I hesitate to comment on litigation strategy, but I can’t help but feel that Hospira’s scattershot approach undermined the strength of its better arguments, particularly given that several of the arguments were thinly argued, occasionally without any supporting authority (see eg [159]). On overbreadth, Phelan J remarked that “Its submissions seem to have been made in the hope that something would “stick” – the patent law equivalent of the Hail Mary pass” [249]. At the end of the day, nothing stuck: Phelan J held the 630 patent to be valid and infringed. I won’t run through all of the arguments, but only those that raise a point of interest.

Experimental Use Exception to Anticipation

A couple of interesting points were raised by Hospira’s novelty attack. First, Phelan J endorsed the experimental use exception to anticipation, albeit in obiter [196]. Hospira argued that the patient consent forms used in Kennedy’s Phase II clinical trials were anticipatory. Phelan J rejected this primarily on the basis that confidentiality was established on the evidence (in part on the basis that the industry practice with clinical trials is to expect the maintenance of that confidence) [196i]. He also rejected it on public policy grounds, as it would effectively put an end to informed consent or to the patenting of medication [196i]. And he also suggested that “the experimental use exception is not as defunct as Hospira would have one conclude,” citing with approval Fothergill J’s decision in Bayer v Apotex 2016 FC 1013, discussed here (and see also Bayer v Apotex 2014 FC 436, Hughes J, discussed here). This experimental use defence to anticipation had some basis in the early case law, but it was not previously well-established; we now have three different Federal Court judges who have recently lent credence to the idea.

Speculative Anticipation

Hospira argued anticipation on the basis of a number of prior art documents which suggested trying infliximab or another anti-TNF-α antibody in combination with MTX, or referenced a trial in which that combination was being tried [196]. This is a bit of a twist on the usual anticipation attack, where the prior art says “We did X” and the question is whether X necessarily falls within the claims of the patent at issue. In this case (to oversimplify), the prior art says “Someone should try X” where X is exactly what the patent claims, namely combining MTX and infliximab to treat RA. (More precisely, the prior art references didn't all reference infliximab specifically.) Phelan J dismissed the prior art references as all being speculative [167], [191]. This calls to mind the case-law arising in the context of a conflict proceeding under the first-to-invent system, where in order to establish inventorship, it had to be shown that at the asserted date “the invention was no longer merely an idea that floated through the inventor's brain but had been reduced to a definite and practical shape” Ernest Scragg & Sons Ltd v Leesona Corp (1964), 45 CPR 1, 33. The allegedly anticipatory prior art in this case was really no more than “an idea that floated though the brain” of the proponents. It strikes me that just as a speculative idea cannot be an invention for the purposes of establishing priority over an inventor who had actually reduced the idea to practice, so it cannot be a disclosure sufficient to anticipate an invention that had actually reduced the idea to practice.

Blinding the Witness

Hospira’s experts were blinded. Phelan J gave little weight to this, saying “blinding alone is not a guarantee of reliability and it is not a sufficient reason to prefer the evidence of one witness over another” [203], consistently with 2016 FC 382 (discussed here). Phelan J also questioned whether blinding was even possible, at least on the facts of this case:

Further, given the involvement of the experts in this case in the development of RA treatments during the relevant time period, it is at least questionable whether blinding holds any value. It is impossible to believe that these experts were not aware of the development of Remicade prior to this trial.

Methods of Medical Treatment

Hospira argued that the 630 patent was invalid as being an unpatentable method of medical treatment [136]-55]. Phelan J recognized that “[t]he jurisprudence with respect to the unpatentability of methods of medical treatment is not entirely consistent” [141]. This is not very surprising, given that the FCA has also called for “full consideration [of the patentability of methods of medical treatment] by this Court or the Supreme Court in a case where the issue is squarely raised on the facts” 2015 FCA 116 [101]. Phelan J’s observation further emphasizes the need for reform in this area of the law.

On the facts, Phelan J held that the patent at issue was not a method of medical treatment, essentially because “the use of X in combination with Y to treat disorder Z” is no different in substance from “the use of X to treat disorder Z” and the latter is clearly patentable: [147]. A claim of that type was at issue in Wellcome / AZT, 2002 SCC 77; and see the discussion here.

Prior Use by Inventor Anticipates Patent

Packers Plus Energy Services Inc v Essential Energy 2017 FC 1111 O’Reilly J
            2,412,072

The technology embodied in Packers Plus’ 072 patent relates to a method for fracking by selective transmission of fluids to different segments of a wellbore by way of a tubing string consisting of a series of packers and ports which can be operated independently [8]. Yesterday’s post discussed O’Reilly J’s holding that the patent was not infringed. Today’s post discusses his holdings that it was invalid as anticipated and for obviousness.

Confidentiality

The anticipation holding presents a classic cautionary tale regarding public disclosure prior to filing. It turned on the fact that the patentee, Packers, had itself used the invention in the field in the fall of 2001, more than one year before the Canadian filing date [65ff]. That use was not really disputed [82]. Rather, Packers argued that the use was not anticipatory, under 28.2(1)(a), either because it was used in circumstances in which all the recipients of the information were required to keep it confidential, or because it came within the experimental use exception [64].

Though there were some indicia of confidentiality, ultimately the confidentiality argument failed on the facts. As I read it, what happened is that in the fall of 2001, Packers, which was already established in the oil-field service industry as a provider of down-hole tools, was asked by a client to do a job in a gas well. Mr Themig, one of the inventors and a principal in Packers, came up with what seemed to be a pretty good solution. The client agreed, and it was implemented. It was only after the fact that Mr Themig began to appreciate just how good a solution it really was, and Packers ultimately set the wheels in motion to apply for a patent. My sense is that in this industry, each hole and every job is a bit different, so it was not out of the ordinary for a high-end firm such as Packers to devise a solution that was strictly novel, in the sense of being tailored to the particular job. That of course does not mean that every solution is patentable, and it is perhaps for that reason that Mr Themig did not take all the steps necessary to make it sufficiently clear that the use of the method was to be considered confidential. It seems to me that the one year grace period afforded under the Canadian Patent Act is intended to address this type of situation. In some industries inventions are products of a patent-oriented lab, but in others they emerge from practical innovators in the field, and in the latter case it is not always reasonable to ask a person to keep patent law requirements in mind while trying to solve a problem for a client. The grace period responds to that problem; but the grace period is necessarily limited and in this case the inventor did not proceed to filing quickly enough.

Experimental Use

The experimental use argument turns on the question of what it means for a use to be “experimental.” In some cases, such as clinical trials of a drug prior to commercialization, the answer is clear, but in the case, the use itself was commercial.

Broad Experimental Use Exception to Anticipation

Bayer Inc v Apotex Inc 2016 FC 1013 Fothergill J
            2,382,426 / micronized drospirenone / YAZ YASMIN / action

Bayer’s ‘426 patent covers an oral contraceptive comprising drospirenone and ethinylestradiol, where the drospirenone is in the form of fast dissolving particles. In this consolidated infringement action, Fothergill J found claims 31, 48 and 49 to be valid and infringed by Apotex’s Zamine and Mya tablets and Cobalt’s Zarah tablets. The conclusions on validity and infringement turned on almost entirely the facts. With that said, it is significant that that Fothergill J accepted the broad experimental use exception to anticipation set out by Hughes J in his NOC decision concerning the same patent. Fothergill J’s remarks on blinding of expert witnesses, as well as on comity and the binding effect of prior FCA decisions on claim construction, are also of interest. This post deals with experimental use and blinding, while tomorrow’s post will deal with comity.

More than one year before the filing date, Schering, Bayer’s predecessor in title [19], conducted Phase III clinical studies in Europe and the United States involving oral contraceptive tablets containing the claimed amounts of drospirenone and ethinylestradiol [145]. (It is not clear to me whether it was admitted that these tablets also fit the claimed formulation profile, but for the purposes of Fothergill J’s reasoning, we may assume they did.)

Participants were given a large number of the tablets, which were to be self-administered over several months outside of a clinical setting. In all three trials, participants were told what the tablets contained, and knew that the tablets were intended to be used as oral contraceptives. No restriction was imposed on participants regarding the disclosure of information concerning the tablets. The participants did not sign confidentiality agreements. [145-46].

Apotex alleged these trials anticipated the ‘426 patent. Fothergill J held they did not. He pointed out that anticipation requires enabling disclosure, and he held that even if some of the tablets had made their way into the hands of a person skilled in the art, such a person would not have been able to reverse engineer the tablets to discover the particular formulation which constituted the invention without the exercise of inventive ingenuity [154-55]. That finding turned on the facts and the law he applied is not controversial.

More interesting is the “alternative” basis for Fothergill J’s holding that the trial did not anticipate [156]. In Bayer v Apotex 2014 FC 436 a prior NOC case involving the ‘426 patent, the same argument was raised that these same clinical trial were anticipatory. Hughes J held that they were not, on the primary basis that Bayer benefited from an experimental use exception to anticipation. The following key passage from Hughes J's decision was quoted by Fothergill J [159]:

[121] In the present case clinical studies were necessary to prove that the drug was safe and effective and, thereby, gain government approval for sale. Until this had been demonstrated, no commercial sale of the drug could have been made. Bayer took reasonable steps to ensure the confidentiality of the relevant documents and to ensure that unused tablets were returned. The theoretical possibility that some tablets were retained and analyzed is just that, theoretical. This theoretical possibility does not preclude the fact that the studies were experimental, and of necessity, conducted by the provision of tablets to members of the public. Thus these clinical studies are exempted from public use.

As I said in my blog post on Hughes J’s decision, this seemingly establishes a broad experimental use exception to what would otherwise be anticipating disclosure, which applies to any clinical trial, so long as reasonable steps are taken to ensure that the unused tablets are returned. Fothergill J agreed with Hughes J both as to this statement of the law and its application to the facts of this case [156], [159]. Fothergill J also clarified that the fact that these trials had been conducted for the purpose of gaining regulatory approval did not take them outside of the experimental use exception [162].

In my post on Hughes J’s decision, I suggested that his decision was notable because, while there was some case law supporting such a broad exception, it was not well-established. Fothergill J’s holding is therefore significant as reinforcing the law stated by Hughes J.

Blinding Expert Witnesses
Apotex argued that the evidence of its expert witnesses should be preferred to those of Bayer’s witnesses because its experts had been “blinded.” Like Brown J in the recent VIREAD decision, 2016 FC 857 (blogged here), Fothergill J was unimpressed by the arguments in favour of blinding. Fothergill J noted that “[t]he fact that expert witnesses were blinded may be persuasive and helpful in weighing their evidence where credibility concerns arise” [65], but, citing Locke J in Shire 2016 FC 382, [45] (blogged here), he continued to say that “if an expert’s opinion is well supported, then there may be no reason to place less weight on the expert’s evidence merely because he or she was not blinded to certain facts when forming that opinion” [66]. In this case, “I have not found the blinding of expert witnesses to be a significant factor in deciding the legal and factual issues raised by this case” [66]. It is still too early to be sure, but the tide may be turning against “blinding.”

Experimental Use Exception to Anticipation

Bayer Inc v Apotex Inc / drospirenone (NOC) 2014 FC 436 Hughes J
            2,382,426 / drospirenone & ethinylestradiol / YAZ

The anticipation argument in Apotex / YAZ turned on clinical trials conducted by Bayer in the US and Europe more than one year before the filing date, in which samples which embodied the invention were delivered to trial participants and their doctors. The doctors and participants did not know the precise ingredients (they knew of the active ingredients and dosage, but apparently not the micronized form) [100]. While Bayer took reasonable precautions to require participants to return unused samples [112], it appears that neither the doctors nor participants had signed confidentiality agreements [99]. While there was no evidence that anyone had ever actually analyzed the tablets [111], there was evidence that it was inevitable that some tablets would not be returned, given the large scale nature of the trials [113]. On these facts, Hughes J held

there has been established a ‘theoretical’ possibility that a tablet could have been kept and analyzed, [and] therefore the requirements of subsection 28.2(1) (a) of the Patent Act have been met” [118].

While Hughes J drew on European case law, and did not cite the recent FCA decision in Wenzel Downhole Tools 2012 FCA 333, it seems to me that this holding is consistent with the test set out by the majority in Wenzel [74, original emphasis] that it is sufficient that “there was an opportunity to access the relevant information.”

However, this did not end the matter. Hughes J held that “The law in Canada has long been established that experimental use in order to bring the invention to perfection, does not constitute public use” [119]:

[121] In the present case clinical studies were necessary to prove that the drug was safe and effective and, thereby, gain government approval for sale. Until this had been demonstrated, no commercial sale of the drug could have been made. Bayer took reasonable steps to ensure the confidentiality of the relevant documents and to ensure that unused tablets were returned. The theoretical possibility that some tablets were retained and analyzed is just that, theoretical. This theoretical possibility does not preclude the fact that the studies were experimental, and of necessity, conducted by the provision of tablets to members of the public. Thus these clinical studies are exempted from public use.

This seemingly establishes a broad experimental use exception to what would otherwise be anticipating disclosure, which applies to any clinical trial, so long as reasonable steps are taken to ensure that the unused tablets are returned.

As authority, Hughes J relied on Conway v Ottawa Electric Railway Co., (1904), 8 ExCR 432, 442; Gibney v Ford Motor Co. of Canada, [1967] 2 ExCR 279 [49], citing Elias v Grovesend Tinplate Co. (1890), 7 RPC 455, 466; and Hi-Qual Mfg Ltd v Rea’s Welding & Steel Supplies Ltd (1994), 55 CPR(3rd) 224, aff’d 61 CPR(4th) 270 (FCA). Of these cases (and I will not go into all of the other case law cited in those cases), Conway does stand for a broad experimental use exception to anticipation, but the others are weaker authority. Gibney and Elias both insisted that the experiments must be kept secret if anticipation was to be avoided, and in both cases the patents were held to be invalid as anticipated. In Hi-Qual the experimental nature of the use was an alternative ground for holding that patent not anticipated, the first ground being that the invention was not publically available. (The invention, relating to farm equipment, was outdoors on the inventor’s property, but the property was not open to the public, and the invention could not be seen from public property.)

It seems to me that one decision more than a century old is not strong enough authority to say this point is well-established. With that said, while old, Conway raises an interesting point which is directly applicable to clinical trials. The invention in question was a snow-plow for clearing street car tracks. An important feature of the plow as compared with the prior art was that it was adapted so as to accommodate the irregularity of real street surfaces. Consequently, it was only possible to develop the invention by experimenting in public, and this fact was relied on by the court in holding the experiments did not destroy novelty. Evidently, with a mechanical snow-plow, even more than with pharmaceuticals, if the device is operated in public it will be disclosed to any knowledgeable observer, and it is impossible to exclude the pubic from the public streets. This suggests that if it is impossible to develop the invention in secret, an experimental use exception may be required. With that said, it is not clear that Bayer could not have filed a patent prior to conducting its clinical trials, as clinical trials are not necessary to establish patentable utility. But in any event, the problem of inventions which must be developed in public is an interesting one in principle.

A different consideration is that it does appear that if the inventors had signed all the doctors and participants to a confidentiality agreement, then the invention would not have been available to the public in the first place. But is this mere legal formalism? It is not clear that signing a confidentiality agreement would have been any more effective than the (unspecified) reasonable steps Bayer actually took to ensure the unused product was returned. Perhaps the law should recognize that taking reasonable steps to ensure product is returned is tantamount to a confidentiality agreement, at least when dealing with unsophisticated patients in a clinical trial. As the Fed Cir put it in Dey v Sunovion

The fact that a tiny fraction of the thousands of vials were lost without penalizing the responsible test subject(s), or that the practicalities of the study required self-administration at home rather than physician administration in a closed facility, does not preclude a reasonable jury from concluding that the use of Batch 3501A was sufficiently controlled and restricted, rather than unfettered and public.

As noted, strictly, this goes to the question of whether there is disclosure to the public in the first place, rather than whether there is an experimental use exception, but this logic does reach the same result as Hughes J on the same factual basis. A response to this argument, as to the point above, may be that the pharmaceutical company should get its patent before starting clinical trials. (Note that in Dey prior trials by the accused infringer were at issue.)

In summary, while there is some case law supporting Hughes J’s position, I would not say that the experimental use exception to anticipation is well-established, and the policy issues are difficult. This aspect of his decision raises important legal and policy questions for the FCA, which might be dealt with either in terms of an experimental use exception, or by a refinement of the Wenzel approach to disclosure. Patently-O posts here and here discussing the same issue indicate that there has been a shift in US case law which has narrowed the experimental use exception, while at the same time adopting a more restrictive test for what constitutes public use.

Addendum: When I wrote this post, I was focused on the interesting legal issue of whether there is an experimental use exception to anticipation, and I glossed over the prior issue of whether there was disclosure to the public in the first place. On further reflection, I do not find the analysis of that point to be entirely satisfactory (though of course this may be a consequence of the way the case was argued). A disclosure to a party under an obligation of confidence is not a disclosure to the public, and while it appears that neither the doctors nor participants had signed confidentiality agreements, it is clear law that an explicit confidentiality agreement is not required to establish an obligation of confidence. The question is whether the product was conveyed in circumstances giving rise to an obligation of confidence: see generally Corlac v Weatherford 2011 FCA 228 [36]- [65], which is now the leading FCA case on the point, and which was not cited by Hughes J. The question of whether the circumstances were such as to give rise to an obligation of confidence is ultimately one of fact. From this decision, all we really know of the relevant facts is that Bayer “took reasonable precautions so as to keep relevant information confidential and to require participants to return any unused tablets” [112]. That at least raises a serious issue as to whether the circumstances were such as to give rise to an obligation of confidence. The simple fact that there was no explicit written or oral confidentiality agreement is “ significant, but not dispositive” (Corlac [53]). On the whole, I am inclined to think that this case should really turn on whether the circumstances were such as to give rise to an obligation of confidence. If such an obligation did arise, then there is no need to invoke an experimental use exception to anticipation; if it did not, then it is difficult to see why an exception should be invoked to protect a party which had disclosed an invention to the public without adequate regard to its confidentiality. Furthermore, whether or not such an exception is desirable is a matter for the legislature. Canadian law does have a grace period for disclosure by the inventor, but many jurisdictions do not. Whether such a grace period is desirable is a debatable matter of policy, and one of the most contentious issues is the uncertainty which it can create (see Part I of the recent Tegernsee Group report). If a further exception is to be made for experimental disclosure, this should be done by the legislature, rather than through an open-ended and poorly defined judicial exception.

Draft Trans-Pacific Partnership Treaty – Regulatory Review Exception

The leaked TPP treaty contemplates a regulatory review exception in Art E.13, but there is some controversy over the scope. There is considerable debate over the precise wording (which makes the annotated draft difficult to read), but main debate is over whether the exception should be confined to getting marketing authorization for pharmaceuticals, or whether it should extend to any kind of  regulatory approval. The US proposal is representative of the more restrictive position, and the Canadian proposal is representative of the broader position. I have parsed out their positions below, with my underlining to highlight the differences. (No other countries support either of these positions exactly, but several support each of them with some deviations.)

Experimental and Regulatory Use Defence Available on the Facts in Imatinib

Teva Canada Ltd v Novartis AG / imatinib 2013 FC 141, Snider J

            GLEEVEC / imatinib mesylate / 2,093,203

Having successfully established the validity of its patent, Novartis sought a declaration of infringement in respect of certain volumes of bulk imatinib held by Apotex. Snider J held that the defence of regulatory use (s 55.2(1)) or the common law experimental use defence, preserved by s 55.2(6), was applicable in respect of bulk imatinib used for the following purposes [395]:

(a) developing suitable formulations and processes;

(b) obtaining regulatory approval to sell commercial formulations; and

(c) demonstrating that its manufacturing process could be carried out on a commercial scale.

Snider J did not deal with the statutory and common law defences separately, though she ultimately held that both were applicable [401.1]. This result is generally consistent with the cases following Micro Chemicals [1972] SCR 506, especially Merck / lisinopril, 2006 FCA 323 [109-13]. The facts on this case are very similar to those in Merck / lovastatin 2010 FC 1265, [631-32] in which Snider J also held the regulatory or common law defence to be available. As Snider J stated in Servier v Apotex / perindopril, “Of critical importance, in my view, none of the raw material or the actual formulations that were made in the course of that development process were ever sold or used for a commercial purpose” 2008 FC 825 [166] aff’d 2009 FCA 222 [24]. 

The importance of lack of commercial use was emphasized by Snider J’s holding with respect to a certain volume of bulk imatinib held in Apotex’s inventory. The defence was not available for this inventory material, so the material was infringing, but Snider J nonetheless declined to exercise her discretion to order delivery up [401.2]. This was primarily because the evidence indicated that this material would not be used for commercial purposes [397], and, importantly, Dr Sherman gave an formal undertaking, which was incorporated in the judgement, that the inventory bulk imatinib would never be used commercially [399-400].