Practice Notice on Dosage Regimes Difficult to Reconcile with Hughes J’s Finasteride Decision

The Practice Notice on Medical Uses released by CIPO on Monday is directed at “medical use claims, including dosage regimens and dosage ranges.” Unfortunately, it seems difficult to reconcile with the relatively recent decision of Hughes J in Merck v Pharmascience / finasteride (NOC), 2010 FC 510, 85 CPR(4th) 179 on exactly that point.

The notice begins by stating that “it is well established that methods of medical treatment and surgery are not statutory subject matter and are excluded from the definition of invention.” This is fair summary of the law. In my view the SCC decision in Tennessee Eastman v Commissioner of Patents, [1974] SCR 111, which is usually cited on this point, really turned on s 41, which is now repealed, but the Federal Courts have consistently read it more broadly, and the point is now established in the Federal Court jurisprudence, independently of the authority of Tennessee Eastman.

The Notice then states that “Medical use claims, however, are generally permitted as long as they do not equate to medical or surgical methods . . . The Federal Court has concluded, however, that inventions preventing physicians from exercising their skill and judgment in using a known compound for an established purpose effectively cover a method of medical treatment.” This is also a fair summary of the case law.

However, the Notice then goes on to say:

[If] it is determined after a purposive construction that a dosage regimen or dosage range is an essential element of a claim encompassing the use of a known compound in an established treatment, then the claim covers a method of medical treatment, and thus, is not compliant with section 2 of the Patent Act.

Where an essential element only serves to instruct a medical professional “how” to treat a patient, rather than “what” to use to treat the patient, this will lead to the conclusion that the claimed use encompasses a method of medical treatment.

The apparently blanket rejection of dosage regime claims is not consistent with the case law.

In Merck v Apotex / alendronate 2005 FC 755, 41 CPR(4th) 35, concerning 2,294,595, the inventive concept was the discovery that a single large weekly dose had fewer side effects than an equal amount taken on a daily basis [27], and the patentee claimed the composition in the specified dosage and dosing interval, as well the composition “for use” in the specified dosage and dosing interval [28]. Mosley J held that these claims were not an unpatentable method of medical treatment, though his reasoning was very cursory as he had held the patent invalid for obviousness [133]-[138]. In contrast, in Axcan v Pharmascience / URSODIOL 2006 FC 527, 50 CPR(4th) 321 concerning 1,318,590, Harrington J. in the Federal Court held that a claim to a dosage form of a pharmaceutical composition for treatment of cirrhosis was an unpatentable on the sole basis that it was a method of medical treatment. Harrington J described the holding of Mosley J in alendronate, but he did not attempt to distinguish it.

In finasteride Hughes J reviewed these cases and reconciled them by saying that "In Axcan, Harrington J. found the claim to be invalid because it was directed to a dosage range in which it was left to the physician to make on appropriate selection" [112]. At the same time Hughes J approved Mosley J's alendronate decision [112]. This is significant, because, as noted, subject matter was only a secondary consideration in Mosley J's decision, so it is relatively weak authority on its own. Consequently, Hughes J concluded that [114]:

a distinction must be made between claims that rely upon the skill and judgment of a medial practitioner and those that deal with a vendible product, be it a scalpel, X-ray machine or 1 mg tablet that are to be used or prescribed for use by such practitioner.

Thus in Hughes J’s view, it is not any dosage regime which is unpatentable, but only a dosage regime which requires skill and judgment.

This is reinforced by his holding on the facts that the claim in question was not unpatentable as being a method of medical treatment. In finasteride only Claim 5 of Patent 2,173,457 was at issue. After incorporation of prior references [5], Claim 5 reads:

5. The use of [finasteride] for the preparation of a medicament adapted for oral administration useful for the treatment of male pattern baldness in a person and wherein the dosage amount is about 1.0 mg.

Hughes J expressly construed this claim such that “having a dosage at about 1.0 mg” was an essential element [101]. Nonetheless, he held it was patentable subject matter: "In the present case, we have a 1.0 mg tablet taken as a daily dose. No skill or judgment is brought to bear. It is a vendible product and not a method of medical treatment" [114]. 

The Practice Notice cited Hughes J’s finasteride decision, but only in an introductory sentence saying that the Notice was intended to reflect judicial decisions. Despite that intent, I do not see how the statement that a claim is an unpatentable method of medical treatment if “a dosage regimen or dosage range is an essential element of a claim,” can be reconciled with finasteride. And apart from fine points of doctrine, there are now two cases holding dosage regime claims are patentable subject matter, and one to the contrary.

Golden Bonus Doctrine in Germany

A few weeks ago I posted about the "golden bonus" doctrine as it was applied in the US COMBIGAN decision. This doctrine says that if an invention is obvious for one reason, it does not become non-obvious merely because it has some non-obvious benefits (the "golden bonus"). This recent post on the Kluwer Patent Blog discussing the Bundesgerichtshof descision in Kosmetisches Sonnenschutzmittel III (X ZR 72/08), indicates that the same doctrine applies in Germany, though couched in European problem-and-solution terms. According to the blog post (unfortunately, I don't read German), the decision held that even if the invention is an inventive solution to the problem the inventors sought to address, it will be obvious if it is an obvious solution to a different problem which a skilled person would also be motivated to address. The post goes on to suggest that the more recent BGH decision in Trenn-Erderschalter (X ZR 160/11) casts some doubt on that holding, but so far as I can tell (again from the Kluwer blog post), the Trenn-Erderschalter decision simply said that the alternative problem itself was not obvious, and so even if its solution was obvious, it would not render the invention obvious.

Teva / Sildenafil Amended

Teva Canada Ltd v Pfizer Canada Inc, 2012 SCC 60, as amended, rev’g 2010 FCA 242 rev’g 2009 FC 638
            2,163,446 VIAGRA   Pfizer / sildenafil (NOC)

In its Teva / sildenafil decision the SCC held that the ‘446 patent is “void” [91], even though this was an NOC proceeding which normally has no in rem effect. In response, Pfizer moved under the SCC rules for rehearing or amendment. The SCC responded by amending its decision to make it clear the its holding does not have in rem effect. The new concluding paragraph [91] is “Therefore, I would allow the appeal with costs and hold that Teva established its allegation that Patent 2,163,446 is not valid, and dismiss Pfizer's application for an order of prohibition under s. 6(1) of the Regulations.” The full amending decision is available from Alan Macek's IPPractice site. This amendment is welcome, though not entirely surprising, as it would have been very unusual for the Court to overturn established law without argument, without mentioning that it was doing so, and without even being asked.

However, the is not the end of Pfizer’s troubles with this proceeding. In Apotex v Pfizer / sildenafil 2012 FC 1339 Zinn J granted summary judgment to Apotex in an impeachment action, holding the ‘446 patent to be of no force or effect, in part on the basis that the SCC had declared the ‘446 void. (In my previous comment on Zinn J’s decision, I focused on the question of whether the SCC had actually declared the patent void.) That point has now been clarified, but that was not the sole basis, or even the primary basis, for Zinn J’s decision. He held that

the determination by the Supreme Court in its Reasons that the ‘446 Patent fails to meet the requirement of sufficient disclosure pursuant to subsection 27(3) of the Patent Act is a legal determination binding on this Court and is dispositive of Apotex’s claim in this action that the ‘446 Patent is invalid due to insufficiency of disclosure, even if the Supreme Court grants Pfizer’s motion and deletes its declaration of invalidity from its Judgment [30] (my emphasis).

With respect, Zinn J must be wrong on this point. This holding a contrary to a very well established law at both the SCC and FCA level that NOC proceedings are not determinative of patent validity (see cases cited below). By holding that the SCC determination is dispositive, Zinn J’s determination effectively does an end-run around this line of cases. It implies that while the result in the NOC case does not directly invalidate the patent, that will be the practical effect because it determines the outcome of the subsequent infringement / impeachment action.

Zinn J did not directly address this line of cases, but instead referred to the rule that claim construction is a matter of law, and that the result turned on “three questions of law: (1) the determination of the invention or inventive concept of the patent, (2) the construction of the ‘446 Patent, and (3) whether the ‘446 Patent, properly construed, permitted the person of skill in the art ‘to make the same successful use of the invention as the inventor could at the time of his application.’”

There are two problems with this analysis. First, it seems to me that the first and third of these points must be questions of mixed fact and law. The inventive concept is the inventive technical contribution made by patentee over the state of the art. The state of the art is a question of fact, and the question of whether the contribution is inventive is mixed fact and law. What the “skilled person” could have taken from the invention requires evidence about the skilled person. I have argued that even the construction of the patent is really a question of mixed fact and law, since it requires factual evidence as to what terms would have meant to a skilled person. The reason the courts refer to it as a question of law is to reserve the ultimate question of claim construction to the court, rather than having to choose betweeen constructions provided by experts. This is entirely reasonable, but it does not mean that there is no factual underpinning to claim construction.

Moreover, I’m not sure I agree with Zinn J’s analysis of the Sildenafil decision. The decision is not easy to understand (I am just about finished a case comment), but my view is that it turned on the SCC's understanding that the other claims in the patent were invalid because the allegation of invalidity was not contested by Pfizer (because it was an NOC proceeding), or on the view that the patentee was trying to “game the system.” Both of these turn on factual issues that were not fully contested in the NOC proceeding.

And even if the determinations were in some sense a question of law, this misses the point of the case law holding that NOC proceedings are not determinative. The principle is based on institutional considerations, not whether a question of law is at issue. As the SCC said in Eli Lilly & Co v Novopharm Ltd [1998] 2 SCR 129, quoting Strayer J.A. in Pharmacia [1995] 1 F.C. 588, 600 (SCC emphasis):

If the Governor in Council had intended by these Regulations to provide for a final determination of the issues of validity or infringement, a determination which would be binding on all private parties and preclude future litigation of the same issues, it surely would have said so. This Court is not prepared to accept that patentees and generic companies alike have been forced to make their sole assertion of their private rights through the summary procedure of a judicial review application.

Similarly, in Lilly v Novopharm 2007 FCA 359 the FCA stated (my emphasis):

[41] NOC proceedings were never intended to be substitutes for an infringement action. Similarly, it is inappropriate to rely on NOC proceedings to set binding precedent on controversial and uncertain questions in patent law. NOC proceedings are supposed to be summary in nature and do not lend themselves to such determinations.

A Product-by-Process Claim Is Not a Product Claim

Bayer Inc v Cobalt Pharmaceuticals Co / drospirenone (NOC) 2013 FC 573 O'Reilly J
            YASMIN® / drospirenone / 2,261,137

In this application Bayer sought an order of prohibition preventing Cobalt from launching a generic version of YASMIN® until the expiry of the ‘137 patent. O’Reilly J refused to grant the order on the basis on non-infringement, and he did not reach Cobalt’s invalidity arguments. The infringement issue turned entirely on claim construction. Bayer’s claim construction argument were far-fetched, and were dismissed by O’Reilly J without difficulty.

Drospirenone is a old compound. The first 12 claims of the ‘137 patent are claims to a process for the production of drospirenone. The description (p 6) states that “a key reaction” in the process is ruthenium-catalyzed oxidation of certain compounds, and all the process claims incorporate that step. Claim 13, the only claim in issue, was to “A product according to the process of claim 12,” wherein the product comprises drospirenone of specified purity. Cobalt alleged that its product would not infringe because its process for the production of drospirenone would not use a ruthenium salt as an oxidizing agent.

Bayer argued that the use of a ruthenium salt as an oxidizing agent was not an essential element of the claims [30]. O’Reilly J rejected this argument [31]-[36]. While identification of the essential elements can sometimes be difficult, in this case O’Reilly J’s analysis is very straightforward and compelling. All the claims included ruthenium and the description identified its use as “key.” There were no alternatives mentioned apart from chromium, which was mentioned only to be avoided; part of the stated purpose of the invention (p 9) was to avoid the use of chromium, for environmental reasons.

Bayer also argued that the SCC decision in Hoffmann-La Roche [1955] SCR 414 stands for the proposition that product-by-process claims should be read as claims to the product alone [13], so that it does not matter how Cobalt’s product was produced, so long as it was of the required purity. As OReilly J pointed out, what Hoffmann-La Roche really says is that you cannot obtain a new patent for an old compound, even though a new process for making it has been invented [20].

Finally, Bayer argued that a skilled person would read Claim 13 as a claim for the purer form of drospirenone, regardless of how it was made [24]. It is not surprising that O’Reilly J rejected this submission, given that the first words of Claim 13 are “A product according to the process of claim 12.”

Triple Re-Litigation of Factual Issues

Apotex Inc vPfizer Canada Inc / azithromycin (NOC) 2013 FC 493 O'Reilly J
             ZITHROMAX / azithromycin / 1,314,876

O’Reilly J’s decision, which I will call Azithromycin AD (No 2), relates to a claim by Apotex for damages under s 8 of the PM(NOC) Regulations, consequent on Snider J’s dismissal of Pfizer’s application for an order of prohibition in the s 6 proceeding, Pfizer Canada Inc v Apotex Inc, 2003 FC 1428 (Azithromycin AD (No 1)). The key issue is whether a prior factual finding of non-infringement in the s 6 proceeding can be re-litigated in the s 8 proceeding. The answer is yes (although on the facts O’Reilly J arrived at the same conclusion as had Snider J, namely that the patent was not infringed). This means that the same factual issues may be litigated three times: once in the s 6 application, again in the s 8 action, and again in the infringement action. "Seemingly redundant litigation" is already said to be a problem with our version of the patent linkage regime: 2012 FC 767 [69]-[70]. This decision, if it stands, will add to the problem.

New Blog on Comparative Patent Remedies

For those of you interested in remedies (and who isn't, at the end of the day?), here is a new blog about Comparative Patent Remedies, by Professor Tom Cotter, the author of an excellent recent book of the same name. In both his book and his blog, Professor Cotter's style combines sophisticated economic analysis with a detailed practical grasp of the legislation and case law. I find his work to be very insightful and interesting from an academic perspective, but it is also just the thing if you are looking for some foreign law to bolster (or undermine) a novel argument.

Patentable Subject Matter: We Have Company in the Chaos

I have criticized the FCA for its inconclusive decision in Amazon.com, which failed entirely to resolve the central question of whether business methods are patentable. But at least we are in good company. As I discuss in my guest post on IPKat, the US Federal Circuit en banc decision in CLS Bank v Alice Corp (Fed Cir 2013) is equally inconclusive. In the UK, the statute itself is confused, but the UK courts are starting to develop a coherent approach, as I discuss in a second IPKat guest post on HTC Europe Co Ltd v Apple Inc [2013] EWCA Civ 451.

Golden Bonus Doctrine in US COMBIGAN Decision

Allergan, Inc v Sandoz Inc / COMBIGAN (Fed Cir 2013) rev’g 818 F.Supp.2d 974

The recent Fed Cir decision in Allergan v Sandoz / COMBIGAN provides an interesting perspective on the parallel Canadian litigation. The invention at issue is a combination of brimonidine and timolol, used for the treatment of glaucoma. Both active ingredients had previously been used for that purpose, and the primary issue in both the US and Canadian litigation was whether the combination was obvious.

In the litigation over the Canadian patent 2,440,764, Allergan v Sandoz / COMBIGAN(NOC) 2011 FC 1316 (blogged here), Crampton J held it non-obvious, largely on the basis that the improved safety profile and absence of an afternoon trough in efficacy as compared to the individual drugs were part of the inventive concept [58], and these were not obvious. Subsequently, in Allergen Inc v Apotex Inc / COMBIGAN (NOC) 2012 FC 767 (blogged here), Hughes J held that the absence of an afternoon trough in efficacy was not part of the inventive concept [147]. His view was that the inventive concept was that the specified combination would achieve the promised results [145]. Consequently, Hughes J would have held the claims obvious [189], but for a concern regarding comity with Crampton J’s prior decision. The disagreement between Crampton J and Hughes J over the nature of the inventive concept turned on a disagreement as to whether the specification as a whole should be considered in construing the inventive concept. On appeal of Hughes J’s decision, the FCA was resolved that debate in favour of considering the entire specification, as Crampton J had done: Apotex Inc v Allergan Inc / COMBIGAN (NOC) 2012 FCA 308 (blogged here). Consequently, the FCA concluded that the improved safety profile was part of the inventive concept [74], and that improved safety profile was not obvious [93]. An order of prohibition was therefore granted.

In the US litigation the district court held that the increased efficacy (absence of an afternoon trough) and reduction in side-effects (improved safety profile) were unexpected results that weighed in favour of non-obviousness (Fed Cir slip op 12, Dist Ct 998-99). In respect of the majority of claims at issue (Claim 1 of 7,323,463 was exemplary) the Fed Cir held that this did not establish non-obviousness:

While the unexpected benefits of twice a day dosing of the combination formula are relevant to Sandoz’s attack on the validity of the method claims, we do not find it similarly meaningful to our evidence in the prior art showing the concomitant administration of brimonidine and timolol multiple times per day, that the combination had benefits over the administration of either alone, and that there was a motivation to combine the two to achieve better patient compliance. KSR, 550 U.S. at 426. Whether or not that combination also solved problems associated with the afternoon trough, we find the motivation to make the combination was real. [My emphasis] Accordingly, we conclude that the claims of the ’463 patent are invalid as obvious.

In other words, if the invention was obvious for other reasons, a patent cannot be supported by the discovery of a non-obvious advantage. This is the classic “golden bonus” principle as described in Hallen v Brabantia [1991] RPC 195 at 216 (CA). This principle is perhaps not as well recognized in Canadian law as it is in English law (compare 2007 FC 455 [309-10] with 2007 FCA 217 [26]), but it is certainly a point which deserves more attention that it received in the Canadian litigation. I am still of the view that the main holding of the FCA in COMBIGAN, that it is necessary to have reference to the entire specification in order to construe the inventive concept, is correct, but the golden bonus argument may provide a different route leading to a different conclusion on the obviousness question.

The Federal Circuit decision was also interesting for a split on Claim 4 of the 7,030,149 patent. (There was no equivalent claim in the Canadian ‘764 patent.)

4. A method of reducing the number of daily topical ophthalmic doses of brimondine administered topically to an eye of a person in need thereof for the treatment of glaucoma or ocular hypertension from 3 to 2 times a day without loss of efficacy [by treatment with COMBIGAN]

In effect, the unexpected advantages were made part of the claim itself. Judge Dyk, dissenting on this point, held that this claim was also invalid, on the basis that a golden bonus cannot render an invention patentable, whether or not that bonus is made part of the claim:

Avoiding a ‘loss of efficacy’ is not a separate step, but rather a result of the claimed method. We should recognize in this case, as we did in Bristol-Myers Squibb, that ‘[n]ewly discovered results of known processes directed to the same purpose are not patentable.’

The majority held that it was not clear from the record whether the increased efficacy was an inherent property of the composition (fn 1). This disagreement raises an interesting point: is it possible to avoid the golden bonus doctrine (if that doctrine exists in Canada), by making the unexpected advantage part of the claim?

No New Cases for the Week of 5 May

No new patent / NOC / data protection cases were posted on the Federal Courts' websites for the week of 5 May 2013.

PMPRB “subverting the will of Parliament”

Teva v Canada (AG) 2013 FC 448 Zinn J (Copaxone II) quashing In re Copaxone PMPRB-2010-D3-Copaxone additional reasons at 2013 FC 500

            PMPRB / Copaxone Syringe

This is the second trip by Teva to the FC appealing a decision of the Patented Medicine Prices Review Board that Teva has sold its Copaxone Syringe at an “excessive” price. In the first decision, 2009 FC 1155 (Copaxone I), Hughes J quashed the decision of the Board for having failed to consider the statutorily mandated factors. Hughes J returned the question to the Board for redetermination. A differently constituted panel of the Board heard the matter, and once again determined that the price was excessive. Zinn J has now held that the decision of the second Board was defective, in exactly the same way as the decision of the first Board, and once again sent the matter back for reconsideration.

Section 85(1) of the Patent Act provides that “the Board shall take into consideration the following factors, to the extent that information on the factors is available to the Board:”

(a) the prices at which the medicine has been sold in the relevant market;

(b) the prices at which other medicines in the same therapeutic class have been sold in the relevant market;

(c) the prices at which the medicine and other medicines in the same therapeutic class have been sold in countries other than Canada;

(d) changes in the Consumer Price Index; and

(e) such other factors as may be specified in any regulations made for the purposes of this subsection.

Copaxone Syringe was introduced by Teva in 2003 at $36 per daily dose. Teva subsequently increased its price to $43.20, a 20% increase, which was in excess of the CPI for the relevant period.* However, during the entire period, Copaxone Syringe was the lowest priced drug in its class domestically, and it was also consistently sold at a lower price in Canada than in any of the other comparator nations specified by regulation [8]. In Copaxone I, Hughes J found that in finding the price increase excessive, “the Board focused only on the [Consumer Price Index] essentially to the exclusion of the other factors set out in section 85(1). Lip service only was given to these other factors” [49]. He therefore quashed the decision and sent it back for redetermination, “preferably by a different panel” [76].

A different panel was duly constituted, and the Board again concluded that Copaxone Syringe was excessively priced. On appeal, Zinn J, like Hughes J, held that “the Board’s decision must be set aside because it again paid no more than lip service to the factors favouring the conclusion that the medicine was not excessively priced, namely paragraphs 85(1)(b) and (c), and again treated paragraph 85(1)(d), CPI, as a conclusive factor” [38]. The second panel’s attempts to explain why the low domestic and international price should not be given any weight were not persuasive enough to constitute a reasoned decision. For example, with respect to the international comparison, the Board argued that “the comparator drugs’ prices are not from Canada and as such might be affected by exogenous factors such as a different regulatory regime, different income levels, and different health and other socio-economic factors.” But as Zinn J pointed out, “Having enacted this provision, Parliament is presumed to be aware of the difficulties in comparing the price of medicines across borders; despite this, it saw fit to include ‘the prices at which the medicine and other medicines in the same therapeutic class have been sold in countries other than Canada’ as a factor to be considered when determining whether a drug is being sold at an ‘excessive’ price in Canada. What the Board appears to be saying is that this factor is inherently unreliable and should be given little if not no weight. The Board appears therefore to be subverting the will of Parliament, which clearly saw this as a relevant factor to be accorded weight” [41].

Its difficulties with the Board are no doubt frustrating for Teva, but the bigger question is why the Board appears to be not just “subverting the will of Parliament,” but doing so systematically. The problem is not just that the Board decided unreasonably; one erroneous decision, or even an unreasonable decision, is readily explained as an aberration. But we now have two different Federal Court judges independently concluding that two differently constituted panels have ignored their statutory obligation. This points to a deeper problem.

* Copaxone I at [7], [33], [34], [35], based on the first Board decision, states that the price increase took place all at once on July 1, 2004, while Copaxone II at [7], [15], [18], [21], based on the decision of the second panel, states that the price increase took place over a period of several years, with substantial increases in 2004 and 2005, no increase in 2006-07, and smaller increases in 2008-08. I have no explanation for the discrepancy, but it is not crucial to the reasons of either panel, or to those of the Federal Court.

No New Cases for the Week of 21 April

No new patent / NOC / data protection cases were posted on the Federal Courts' websites for the week of 21 April 2013.

No New Cases for the Week of 14 April

No new patent / NOC / data protection cases were posted on the Federal Courts' websites for the week of 14 April 2013.

No New Cases for the Week of 7 April

No new patent / NOC / data protection cases were posted on the Federal Courts' websites for the week of 7 April 2013.

No New Cases for the Week of 31 March

No new patent / NOC / data protection cases were posted on the Federal Courts' websites for the week of 31 March 2013.

Delayed Release Esomeprazole Not Obvious on the Facts

Astrazeneca Canada Inc. v. Ranbaxy Pharmaceuticals Canada Inc / esomeprazole (NOC) 2013 FC 232 O’Keefe J
            NEXIUM / esomeprazole / 2,170,647

Obviousness was the only point in issue in this NOC proceeding related to a delayed release form of esomeprazole. O’Keefe J’s decision holding that the enteric coating formulation was not obvious, due to the difficulty of actually producing an effective coating, turned entirely on his assessment of the conflicting expert evidence.

The only point of more general interest is a brief review at [80]-[84] of the case law relating to the “motivation” aspect of the obvious to try test. O’Keefe J noted that in Allergan Inc. v Canada (Minister of Health), 2012 FC 767 a finding that there was a strong motivation to solve the problem at hand supported a finding of non-obviousness, on the logic that “If other parties were motivated to find the solution and yet were unable or unwilling to do so prior to the patent being obtained, this factor would point to a solution that was not ‘obvious to try’” [82]. On the other hand, in Janssen-Ortho Inc. v Novopharm Ltd. 2006 FC 1234, a finding that there was “no motivation exhibited by any outside persons to explore Ofloxacin enantiomers,” also supported a holding of non-obviousness, on the basis that absent Daiichi’s motivation, “there may well never have been levofloxacin” [84]. 

Note that in his recent decision in Apotex Inc. v. H. Lundbeck A/S / escitalopram 2013 FC 192 (not mentioned by O’Keefe J), Harrington J remarked that “I am troubled by the concept of motivation. Wishing does not make something come true. Wishing does not make something easier. A motive is defined as that which moves or tends to move a person to a particular course of action (Oxford Dictionary). On the other hand, there may not have been reason to do something at a particular point in time. For instance, there may have been little interest in increasing automobile fuel efficiency in the 1950s. Lack of interest would not give rise to a patent if what was eventually done was obvious” [99]. It seems that significance of motivation in the obvious to try test needs clarification.

O’Keefe J’s reasoning in this case did not ultimately turn on the question of motivation.

Sufficiency and Utility

Novartis Pharmaceuticals Canada Inc v Teva Canada Ltd / zoledronate (NOC) 2013 FC 283 Hughes J
            ZOMETA ACLASTA / zoledronate / 1,338,895

What is the relationship between sufficiency and utility? Recall that claim 14 of the ‘895 patent, which was to a broad class, was held to lack utility on the basis that the it was not possible to predict the potency of any individual compound without testing. Hughes J held the ‘895 patent to be insufficient for the following reason:

[177] For the same reasons as discussed with respect to utility, I find that the '895 patent, claim 14, is insufficient, even at the date that the patent was issued and granted. No further discussion is required in respect of that patent.

I have to admit this reasoning is not transparent to me. Hughes J made this statement at the very outset of his sufficiency analysis, so there is no context that might shed light on his reasoning. There was no suggestion in the discussion of utility (or anywhere in the decision) that the ‘895 patent did not adequately disclose how to make the compounds in question (“classic insufficiency”). I don't see an obvious link to Sildenafil insufficiency. Could this be a reflection of the US doctrine that an invention that lacks utility is necessarily insufficient, on the logic that “Obviously, if a claimed invention does not have utility, the specification cannot enable one to use it.” In re Brana, 51 F.3d 1560, 1565 (Fed. Cir. 1995)? But I had not understood that to be established in Canadian law; and in the UK it seems that this proposition has been rejected: see Tetra Molectric’s Application [1977] R.P.C. 290 (CA) at 297: “if much of Mr. Walton's argument on this branch of the case be right, every failure to achieve the promised result could, as my Lord pointed out during the argument, be attacked for insufficiency under section 14. For my part, I cannot think this is right."

Sufficiency Assessed as of Publication Date

Novartis Pharmaceuticals Canada Inc v Teva Canada Ltd / zoledronate (NOC) 2013 FC 283 Hughes J
            ZOMETA ACLASTA / zoledronate / 1,338,895, 1,338,937

As discussed in my last post, Hughes J held that the ‘937 patent was not invalid for Sildenafil insufficiency because it claimed only a single compound. Recall from the prior post that the ‘937 patent had been placed in conflict with the ‘837 patent, and both had originally claimed a broad class of compounds. The claims of the ‘937 patent had been narrowed to zoledronate after filing, as a result of a settlement between the parties. Hughes J remarked that:

[178] The [‘937] patent was issued and granted with only two claims – both specific to zoledronate. For the same reasons as previously set out, I have distinguished this patent from that considered by the Supreme Court in Teva [Sildenafil] on the basis that the claims were specific to zoledronate, only. However, when the application was filed in Canada, the application contained claims to many compounds, including genus claims and claims to specific compounds; including, but not restricted to, zoledronate. If I were to consider sufficiency as of the date of filing the application, I would find that the application was no different than that considered by the Supreme Court in Teva, and thus was invalid for lack of sufficient disclosure.

(As discussed in my last post, I’m not entirely sure that the situation would have been the same because of possible differences in the number of compounds that had been tested, but Hughes J did not explore this point.)

Hughes J dealt with this problem by addressing the issue of the date for assessing sufficiency. He noted that “Canadian law has not been clear as to what is the date for considering sufficiency” [179], and while the SCC in Free World Trust 2000 SCC 66 [53-54], had held that the date of publication is the correct date for claim construction, it had left open the question of whether this is also the correct date for assessing sufficiency [182]. He reviewed the case law, including in particular Biogen v Medeva [1996] UKHL 18, in which Lord Hoffmann had held that the appropriate date was the date of the application (that is, the filing date, not the date of the priority application, and not the date of publication), largely on the ground that otherwise an application that was insufficient when filed might be sufficient when published as a result of intervening advances in the common general knowledge. As Hughes J put it, “An applicant should not be able to take advantage of intervening advances in the state of the art so as to render sufficient an insufficient application as filed” [185].

While Hughes J accepted that this “would make sense” [186], he held that the Sildenafil decision mandated a different result:

[187] The Teva decision has caused me to distinguish the '937 patent at issue here from that considered by the Supreme Court on the basis that in the '937 patent, the claims were limited to a single compound. Claims can be added, removed or amended at any time during the application process, whether one is dealing with the “old” or “new” Patent Act. Even after a patent has been issued and granted it may, within a limited period, be reissued with fewer or more or different claims; claims may be reduced by disclaimer and possibly even by dedication. The patentee is not seeking advantages because of advances in the scientific state of the art; but rather, is seeking to keep up with the state of the jurisprudence.

[188] I find that the most appropriate date for consideration of sufficiency of a Canadian patent is, as found by Buckley LJ in Standard Brands, as referred to by Lord Hoffman in Biogen, that of the date of publication. That is the date that the public is seized with the application. That is the date that the person applying for the patent has committed to claims for the invention in a manner available to the public. In the case of an “old” Act patent, this would be the day that the patent was issued and granted. In the case of a “new” Act patent, it would be the date of publication.

While Hughes J relied primarily on Sildenafil, this reasoning and conclusion strikes me as consistent with the holding in Free World Trust that the claims are construed as of the publication date. We can’t know whether the invention is properly disclosed until we know what it is. If “the invention” is the invention as claimed, we don't know what the invention is until the publication date. (And see 2007 FC 596 Hughes J. at [140-41], and 2009 FC 638, Kelen J at [108] to this general effect).

But what if “the invention” is not the invention as claimed? If the invention is the inventive concept which emerges from the disclosure, then it would be possible to decide whether the disclosure is sufficient even in the absence of any claims at all. One difficulty with this argument is that it is not consistent with Sildenafil, in which the SCC held that “the specification as a whole must be examined.” The whole specification includes the claims: “We must look to the whole of the disclosure and the claims to ascertain the nature of the invention” and “It is possible . . .for each claim in a patent to disclose a separate invention” [64]. This seems to be clear that the claims must be considered, as well as the disclosure. This strongly supports Hughes J’s conclusion.

So, while Hughes J’s reasoning in light of Sildenafil seems sound, having sufficiency assessed as of the publication date does leave the policy objection that an invention that is insufficient at the filing date may be sufficient at the publication date because of advances in the common general knowledge. Perhaps this is not a conclusive objection – after all, no one will be relying on the disclosure before publication – but it is certainly disquieting. I cannot think of any entirely satisfactory answer to this problem.

Claim to Single Compound Distinguishes Sildenafil

Novartis Pharmaceuticals Canada Inc v Teva Canada Ltd / zoledronate (NOC) 2013 FC 283 Hughes J
            ZOMETA ACLASTA / zoledronate / 1,338,895, 1,338,937

The insufficiency at issue in Sildenafil 2012 SCC 60 is very different from the traditional how-to-make insufficiency, and it is convenient to give them different names. For now, at least, I will refer to “Sildenafil insufficiency” and “classical insufficiency” by analogy with “Biogen insufficiency” (overbreadth) and “classical insufficiency” in UK law.

Sildenafil insufficiency was raised in respect of the ‘937 patent. (For an overview the facts, see yesterday’s post.) While the patent claims zoledronate specifically, zoledronate is not singled out in the disclosure. The disclosure of the ‘937 patent begins by stating that it relates to a class of compounds with the following structure (formula I):


From pages 5-7 the patent lists compounds of formula I to which the invention “relates” or “relates more particularly” or “preferably relates” or “relates firsts and foremost,” but these are all classes of compounds. Zoledronate does fall within the class, but it is not specifically named [69]. The invention is also said to “relate[] specifically to the compounds of formula I and the salts thereof, especially the inner salts and pharmaceutically acceptable salts thereof with bases mentioned in the Examples” [70]. There are about thirty-two compounds specifically named in the twenty examples, and zoledronate appears in two examples. The examples are all examples of how to make the compounds. Note also that this statement says that the invention relates specifically to salts with bases mentioned in the Example, not to compounds mentioned in the examples. So, even though zoledronate is mentioned in the Examples, it is not being singled out as a particularly efficacious compound; it is the salts which are particularly useful. There is no statement in the disclosure of which compounds have been tested for potency, nor is there any evidence discussed by Hughes J as to which compounds had been tested as of the date of the priority application. Zoledronate itself was made and tested in July 1987, which is after the priority application was filed, but before the Canadian application was filed [107].

From this we see that the ‘937 patent is similar to the patent at issue in Sildenafil, in that “No specific attributes or characteristics are ascribed to [the claimed compound] that would set it apart from the other compounds,” and “the patent itself suggests that the entire class of claimed compounds will be effective” [134, quoting Sildenafil [66-67]]. Hughes J nonetheless held that:

the '937 patent, because it claims only one compound, zoledronate, is, on a case-by-case basis, distinguishable from that considered by the Supreme Court in Teva [138].

This distinction does have a sound basis in the passages from Sildenafil [80] quoted by Hughes J at [136]:

The skilled reader knows that, when a patent contains cascading claims, the useful claim will usually be the one at the end concerning an individual compound. . . . However, the public's right to proper disclosure was denied in this case, since the claims ended with two individually claimed compounds, thereby obscuring the true invention.

The SCC acknowledged that even though the disclosure did not specifically identify the compound of particular interest, the claims are part of the specification, and a skilled person would know that the claimed compounds are normally of particular interest. This implies that claiming individual compounds is tantamount to specifically identifying them in the disclosure. The difficulty in Sildenafil was that two compounds were identified, while only one was truly of interest. In this case, only one compound was claimed, so not even a “minor research project” would be needed to identify the compound of interest.

The distinction between one individual compound claim and two, is nonetheless a fine one. This is not to doubt the validity of the distinction. A line must be drawn somewhere, and as just discussed, there is a sound basis for this distinction both functionally and in Sildenafil itself. It does illustrate once again that the Federal Courts appear not to be inclined to use Sildenafil insufficiency aggressively.

On a slightly different point, while the Sildenafil decision formally turned on “what is the invention,” the "key issue in this appeal" was that "patentees cannot be allowed to 'game' the system" [80] (discussed here). It seems to me that the number of claims is not the only distinction to be drawn between this case and Sildenafil. In Sildenafil only one compound had been tested, while in this case it is not clear to me from the decision how many compounds had been tested. Zoledronate had been tested only after the priority application, and it seems unlikely that the priority application had been filed before any compounds at all had been tested. So I would suspect that as of the Canadian filing date, multiple compounds had been tested and shown to have had at least some efficacy. This means the situation may have been more like Imatinib (here), in which several compounds had been tested but none had emerged as the clear favourite. It would have been interesting to have had a more extensive discussion of the "gaming the system" issue from Hughes J, as was carried out by Snider J in her Imatinib decision (discussed here).

Utility / Obviousness Squeeze in Unpredictable Field

Novartis Pharmaceuticals Canada Inc v Teva Canada Ltd / zoledronate (NOC) 2013 FC 283 Hughes J
            ZOMETA ACLASTA / zoledronate / 1,338,895, 1,338,937

This NOC decision concerns a patent to zoledronate (‘937) and a separate patent to a broad class of compounds including zoledronate (‘895). Both patents were attacked for lack of utility, obviousness and insufficiency. The obviousness and utility issues were fairly straightforward on the facts, but the insufficiency argument raised two important points arising from Sildenafil 2012 SCC 60. This post will provide an overview and deal with the utility and obviousness points, and my next posts will deal with insufficiency.

Hughes J’s reasons are common to two applications brought by Novartis to prevent an NOC from being issued to Teva in respect of zoledronate, which is a bone mechanism regulator, used for treating conditions such as osteoporosis. The applications concerned ZOMETA and ACLASTA, which are different strength formulations. Both patents in issue relate to both formulations, and nothing in the decision turns on the strength of the formulations; the reasons would have been exactly the same if only one of the applications had been brought.

In the late 1960s researchers had discovered that a class of compounds known as bisphosphonates were useful (or perhaps more accurately, potentially useful) in controlling bone resorption, which is a bodily process implicated in bone diseases such as osteoporsis [84]-[95].

Research on second generation bisphosphonates focused on selecting molecules in the R1 and R2 position, and on “linkers” between these molecules and the geminal carbon. Both the inventors of the ‘895 patent, working for Boehringer, and the inventors of the ‘937 patent, working for Ciba-Geigy (now Novartis), developed a class of bisphosphonates with one CH2 linker molecule and a five-membered heteroaryl radical in the R1 position [57], [66]. The ‘895 patent claimed priority from a German application filed on 1 August, 1986, while the ‘937 patent claimed priority from a Swiss application, filed 21 November 1986 [9], [14]. The patents were placed in conflict under the old Act, and the parties settled so that Boehringer obtained the '895 patent with broad genus claims, and Ciby-Geigy obtained the '937 patent with claims to zoledronate alone. This is all by way of explaining why there are two patents in issue, rather than one patent with broad and narrow claims. Novartis listed both patents on the patent Register, presumably as licensee. 

The narrowest claim of the ‘895 patent, Claim 14, was the only claim in issue and it encompassed approximately 1.2 million compounds, one of which is zoledronate. The ‘937 patent had only two claims, to zoledronate and to zoledronate with pharmaceutical excipients.

The evidence accepted by Hughes J established that at the time of the filings, almost nothing was known about why bisphosphonates worked to inhibit bone resoption. It was not even known whether the mechanism was biological or physical-chemical. The target enzyme was not identified until the mid-1990s. Consequently, there was no structure / activity model allowing for prediction of the activity of any particular compound. Experimentally, small differences in structure could result in large differences in biological activity. This meant that each individual bisphosphonate had to be synthesized and tested in a biological model in order to assess its potency [153].

These factual findings led directly to the conclusion that neither invention was obvious [159], but also that Claim 14 of the ‘895 patent, to a broad class, was lacking in utility [167-68]: “In brief, the state of the art was at the empirical stage where compounds would have to be assessed individually.” This was a kind of obviousness / utility squeeze, favouring the individual compound claim; the lack of predictability that was the basis for a successful utility attack on the broad claim was also the basis for holding the individual compound claim to be non-obvious. As it happens, the ‘937 patent, which was held valid, expires on February 25, 2014, 3 weeks after the ‘895 patent, and an order of prohibition was granted accordingly.

Contribution Approach to Patentable Subject Matter Repudiated by CIPO

Guidelines Respecting Computer-Implemented Inventions PN2013-03

The new CIPO guidelines respecting computer-implemented inventions explicitly repudiate central aspects of the MOPOP Ch 16, that was revised as recently as October 1010. The Patent Notice introducing these guidelines says that the occasion for this further revision is the Amazon.com decision 2011 FCA 328, but it is probably more accurate to say that it reflects a general reconsideration of CIPO’s approach, particularly in light of the release of the poorly received proposed guidelines that were released last April. The problems with Ch 16 were apparent prior to Amazon.com and the FCA decision in Amazon.com was ambiguous and difficult to interpret (see my post on Amazon.com here) and so did not in itself compel revision of Ch 16. The new practice guidelines are a major improvement on Ch 16; they are clearer and easier to apply, and they are consistent with the SCC Shell Oil decision. The law itself remains confused as a result of the FCA decision in Amazon.com itself, but the problems with the law will be sorted out in the courts (or possibly the legislature), rather than in battles with the Patent Office. Considerable credit is due to CIPO for have been willing to make such a major change to its position in response to stakeholder feedback.

The debate over the patentability of computer-implemented inventions has played out in terms of the rule against claiming abstract ideas (“No patent shall be granted for any mere scientific principle or abstract theorem”) set out in s 27(8) of the Act. There are two contrasting views of that rule. On one view, the rule prohibits patents for invention where the inventive concept lies solely in an idea, rather than its application. On the alternative view, the rule prohibits only claims to an abstract idea as such; a claim to an application of an idea is acceptable, even if the inventive concept lies solely in the idea. Put another way, the first option sees a rule against claiming abstract ideas while the second view sees a rule against claiming abstract ideas. The difficulty with first view is that all inventions are ultimately based on an idea. If that were a prohibition on patenting, nothing would be patentable. The correct rule is the second, as set out in Shell Oil [1982] 2 SCR 536, 554:

A disembodied idea is not per se patentable. But it will be patentable if it has a method of practical application.

Despite this, the October 2010 revision of MOPOP Ch 16 on computer implemented inventions adopts the first approach: Ch 16.03.02 “Where a machine implements a non-statutory method, in contrast, inventive ingenuity associated with the method per se does not provide the inventive step necessary to support the patentability of a machine implementing that method. The inventive ingenuity necessary to make the machine patentable must arise in relation to adapting the machine to implement the method.” That is, the ingenuity must lie in the implementation of the algorithm or idea, and not in the algorithm or idea itself. This was referred to as “contribution approach.” The argument is that the inventive contribution must be statutory, and abstract ideas are non-statutory, so if the only inventive contribution is an idea, the invention is not patentable: see MOPOP Ch 13.05.03. This analysis is contrary to Shell Oil, which holds that the inventive contribution may be an idea, so long as the invention as claimed as a concrete application of that idea.

This analysis has been repudiated. PN 2013-03 states expressly that “the ‘contribution approach’ set out in MOPOP Chapter 13 is not to be used,” and sections of Ch 16 which invoke on that concept, including Ch 16.03, are no longer to be relied on.

With PN 2013-03, CIPO appears to have come down firmly in favour of the view expressed in Shell Oil. The guidelines indicates that fine arts and methods of medical treatment are excluded from patentability under s 2 of the Act, but computer-implemented inventions are not on this list. The guidelines also state, citing Shell Oil, that “disembodied inventions” will be unpatentable, as “where the claimed subject-matter is a mere idea” (my emphasis). In general, the guidelines indicate that computer-implemented inventions are not to be treated any differently from any other invention. The bulk of the guidance is concerned with how to identify the essential element of a computer-implemented invention so as to carry out a purposive construction, but it does not say that an invention is unpatentable if the essential element is an algorithm. On the contrary, it implies that an invention where the only contribution is an algorithm is patentable: “For example, if an examiner concludes that the solution to a given problem is to perform certain calculations according to a specific equation, the use of a computer to perform the calculations may expedite the mathematical manipulations without having a material effect on the operation of the equation itself. The examiner could therefore conclude that the computer is not an
essential element of the invention.” But the invention is not unpatentable for that reason.

The bottom line is that software remains patentable in Canada. (Despite Ch 16, software patents had routinely been granted in Canada, after a period of uncertainty subsequent to the FCA decision in Schlumberger [1982] 1 FC 845, 56 CPR (2d) 204 (CA).) The new guidelines are consistent with Shell Oil, and are a major improvement over Ch 16 as it stood. I should add that this is not to say that I believe that software patents are a good thing. That is a separate question, which, in my view, is a question for the legislature rather than the courts or the Patent Office.

The Notice releasing these guidelines says that “Subsequent practice guidance for medical use claims and diagnostic methods will follow shortly.” In light of these guidelines on computer-implemented inventions, we can be reasonably hope that the new practice guidance will not resemble the consultation document on Office Practice Respecting Claims to Diagnostic Methods and Medical Uses, which would have effectively made the USSC Prometheus decision part of the Canadian Patent Office practice.

Temporary Stay in Ontario “s 8" Disgorgement Action

Apotex Inc v Schering Corporation / ramipril, 2013 ONSC 1411 Stinson J

Dissatisfied with the ruling that disgorgement of the patentee’s profits is not available as a remedy in a claim under s 8 of the NOC Regulations (2011 FCA 358 blogged here), Apotex has turned to the Ontario courts to seek a disgorgement for the same wrong, that is being kept out of the market as a result of the statutory stay under the NOC Regulations, under a variety of legal theories. In this motion, Stinson J has ordered a temporary stay of Apotex’s action in respect of ramipril pending the outcome of the appeal taken by the defendants to the FCA Snider J's decision in Apotex v Sanofi / ramipril (s 8) 2012 FC 553 (an overview is given here). Stinson J held that while the causes of action were different, and the remedies would not necessarily be the same (certainly not according to Apotex’s submission), there was nonetheless a substantial overlap of the issues so that wasteful duplication of judicial resources was likely if the parallel proceedings were maintained [17]. Moreover, even though the causes of action are different, any amount awarded to Apotex in the s 8 proceeding would likely be relevant to the quantum in the Ontario proceeding, in order to avoid giving Apotex double recovery [14]. On the other hand, the only downside to ordering a stay is a delay in Apotex’s recovery of any damages which it might be awarded in the Ontario action [20]; in particular, the availability of generic ramipril would not be affected. Note that Sanofi is now focusing on having Apotex’s claim struck entirely [1] in light of Quigley J’s recent decision in Apotex v Abbott / lansoprazole 2013 ONSC 356 (blogged here).

Purposive Construction in the Patent Office

Examination Practice Respecting Purposive Construction PN2013-02

CIPO has issued new practice guidelines respecting purposive construction (PN2013-02) and computer-implemented inventions (PN2013-03). Both sets of guidelines strike me as basically sound. This post makes a few comments on the purposive construction guidelines. A subsequent post will comment on the guidelines regarding computer-implemented invention, which mark a radical departure from CIPO’s prior formal position.

The guidelines respecting purposive construction begin with a puzzling statement suggesting that while the approach to construction set out in Free World 2000 SCC 66 and Whirlpool 2000 SCC 67 will “continue to guide the courts,” these cases were not directed to patent examiners. The guideline relies for this on two paragraph from Gibson J’s decision in Genencor v Canada (Comm’r of Patents) 2008 FC 608, in which Gibson J at [61] quoted a passage from Whirlpool [52] to the effect that a “dictionary” approach to construction must be rejected and the claims must be construed with reference to the entire specification. It was in respect of this passage that Gibson J stated that “I am satisfied that the foregoing, in all its implications, was directed to trial judges and to judges of courts of appeal and not to patent examiners in the course of examinations.” To the extent that this suggests that a dictionary approach should be taken in examination, and the claims should not be read in the context of the patent as a whole, this statement is clearly wrong, and it would be disturbing if this approach were to be adopted in examination. But later on the guidelines emphasize that “it is critical that a purposive construction of the claim be performed considering the specification as a whole as read through the eyes of the person skilled in the art,” which is exactly what the SCC said in Whirlpool in the passage impugned by Gibson J. Also, the guidelines go on to note that “during examination of an application the language of the claim may change from that initially proposed by the applicant for a number of reasons,” and that construction of the patent “must take into account the role of the patent examiner and the purpose and context of examination.” This seems to me to be a reasonable proposition. For example, the courts are very reluctant to hold a patent invalid for ambiguity. In contrast, rejections in examination based on indefiniteness are relatively common. This difference seems reasonable, since the remedy is different. During examination, the patentee can amend the claims, and if the claims in an application are arguably ambiguous, they should be clarified before grant in order to provide clear notice to third parties. Once the patent has issued, it may be appropriate to give the best interpretation to those same claims, in light of the relatively draconian alternative of holding the claims invalid. More generally, the functional point the guidelines seem to be making is that the examiner is not obliged to engage in the same kind of detailed scrutiny and fine parsing of claim that might be undertaken at trial, and if the validity of a claim turns on its scope, the scope should by clarified be amending the claim rather than by engaging in a debate over claim construction. Genencor was presumably the best authority that could be found for this proposition, and that may well have been the real thrust of that decision, despite is peculiar treatment of Whirlpool.

Apart from that, the main feature of the guidelines is a focus throughout on identifying the problem and solution as part of the construction, relying on s 80(1)(d) of the Patent Rules, which require the description to “describe the invention in terms that allow the understanding of the technical problem, even if not expressly stated as such, and its solution.” The problem-and-solution approach is an accepted part of the obviousness analysis in the EPO, and while systematic focus on the problem and its solution is not similarly accepted in the Federal Courts, there are many cases which invoke similar language, as discussed here. My own view is that this is generally a useful approach, particularly in the obviousness context.

I also entirely agree with the statement that “Without having first considered the problem and solution, the identification of essential elements would be circular - it would begin and end with the language of the claim.” I make a similar point in my Essential Elements article, 22 I.P.J. 223 (2011).

The practice guidelines also invoke Rule 80(1)(d) as support for the promise of the patent doctrine for determining utility. My view is that the false promise doctrine is incompatible with the Canadian Act, but I can’t criticize CIPO for accepting it, given that the FCA has said it is the law.

Punitive Damages, Electing an Accounting, and Deduction of Fixed Costs

Apotex Inc. v. H. Lundbeck A/S / escitalopram 2013 FC 192 Harrington J
            CIPRALEX / escitalopram / 1,339,452

While Apotex had not launched prior to bringing its impeachment action, monetary remedies were still a live issue because it had stockpiled in the expectation of getting an NOC. When that prediction had turned out to be wrong, it sold some of the stockpiled product to affiliates in the Czech Republic and Australia [259-60], giving rise to profits and Harrington J permitted Lundbeck to elect an accounting [271]. In assessing the profit to be accounted for, Harrington J addressed one difficult remedial question, namely the deductibility of fixed costs in an accounting of profits. His approach to punitive damages and the patentee’s election of an accounting are also interesting.

Sildenafil Doctrine Not About Data Disclosure

Apotex Inc. v. H. Lundbeck A/S / escitalopram 2013 FC 192 Harrington J
            CIPRALEX / escitalopram / 1,339,452

With the recent Sildenafil 2012 SCC 60 decision, we can expect to see Sildenafil-type insufficiency raised regularly, at least until the bounds of the doctrine are fleshed out. This is second case to deal with the doctrine, and it is consistent with Snider J’s imatinib 2013 FC 141 decision (blogged here) in holding that the Sildenafil doctrine is not about disclosure of data, it is about disclosure of the invention.

The issue in this case was that the specification stated that “results upon administration to human beings have been very gratifying.” This was not true, as the enantiomers had not been tested on humans until after filing [225]. Apotex argued that the patent should therefore be declared void on the basis of s 27(3), which is to say on the basis of the disclosure requirement as interpreted in Sildenafil.

Apotex had raised the same statement in the NOC proceedings, arguing both s 27(3) and s 53 (though of course not relying on Sildenafil). In that case, Harrington J had dealt with it on the basis of s 53, which states that a patent is void “if any material allegation in the petition of the applicant in respect of the patent is untrue.” (He noted in this case that in so doing he had conflated the two provisions.) He had held in the NOC preoceedings that read in context, the statement was not misleading, nor had anyone been misled: 2009 FC 146 [147].

In this case, the point was based on s 27(3), not s 53 [229]. Harrington J again rejected the argument, but on an entirely different basis, tailored to the different provision. He held that the Sildenafil doctrine simply did not apply. In Sildenafil, “the invention was the use of sildenafil for the treatment of ED,” and it was this that had to be disclosed [233, quoting SCC [72]], whereas “In this case, the invention, (+)-Citalopram and how to get there, was properly disclosed” [235]. This strikes me as a correct interpretation of Sildenafil. It is also consistent with Snider J’s imatinib 2013 FC 141 [375] decision, in which she held that failure to disclose test data cannot in itself result in a finding of insufficiency. In imatinib the issue was failure to disclose test data, and in this case it was disclosure of erroneous data, but in either case, the basic principle is that the Sildenafil doctrine is not about disclosure of data, it is about disclosure of the invention.

Finally, I note that Harrington J accepted the view that the SCC in Sildenafil had “declared the patent void, notwithstanding that the appeal was in a PM (NOC) application” [234]. As discussed here, my own view is that the SCC did not hold the patent void in rem.

Proving What the POSITA Would Have Thought

Apotex Inc. v. H. Lundbeck A/S / escitalopram 2013 FC 192 Harrington J
            CIPRALEX / escitalopram / 1,339,452

The primary issue in this escitalopram decision was obviousness, and “the prime issue, really, is what two over-qualified experts in 2012 would think an ordinary pharmaceutical chemist would have thought of doing in 1988 [the claim date]" [161]. It is well-recognized that the obviousness determination must guard against the hindsight bias, which means that something may have seemed difficult at the time, but obvious in hindsight. But the problem in this case, while related, is even more basic: what kind of proof is needed to today, to establish what a hypothetical person counter-factually would have thought 25 years ago?

Affirmed that Award under NOC Section 8 to Be Considered in Damages in Subsequent Infringement Action

AstraZeneca Canada Inc v Apotex / omeprazole (NOC) 2013 FCA 77 Sharlow JA: Blais CJ, Stratas JA aff’g 2012 FC 559 Hughes J (blogged here)
            LOSEC / omeprazole / 2,133,762, 1,292,693

AstraZeneca was unsuccessful in NOC proceedings against Apotex in respect of omeprazole, in which it sought an order of prohibition based on the ‘762 patent: 2004 FC 313. In this action, Apotex has now sought compensation under s 8 of NOC Regulations. But at the same time, AstraZeneca has brought an infringement action against Apotex, on the basis of the ‘693 patent, which is also related to omeprazole, with the action set down to be heard in April 2014 [FC 28]. The concurrence of the s 8 and infringement actions raises two questions. Substantively, if AstraZeneca is successful in the infringement action, how will this affect Apotex’s entitlement to s 8 compensation? Apotex's position is that the alleged infringement of the '693 patent is not relevant to Apotex's s 8 claim [FC 141]. AstraZeneca's position’s is that if it is successful in the infringement action, this operates as a defence to the s 8 claim; the claim is for sales that are lost as a result of the statutory stay, but if Apotex had made those sales, it would be liable in damages to AstraZeneca for infringement of the ‘693 patent, so there really are no losses as a result of the statutory stay [FC 140]. Put another way, Apotex is not entitled to damages for loss of a market that it had no right to enter. Consequently, AstraZeneca sought a delay of the s 8 proceeding pending the outcome of the infringement action. Hughes J had initially ordered that if AstraZeneca’s defence was determined to be viable in law, he would reserve judgment in the s 8 matter under final disposition of the infringement action [FC 28].

The decision under appeal dealt with this question of whether AstraZeneca’s defence is viable in law [FC 140 - 50]. As discussed in my post on that decision, Hughes J held that the infringement action could potentially serve as a basis for a defence in the s 8 proceeding on the basis of ex turpi causa. However, procedurally, he changed his mind and refused to reserve judgment in the s 8 proceeding. Instead, any such defence will be dealt with in the infringement action:

[148] This solution accords with what may properly be done in the present situation. A Court hearing the pending infringement action, if it concludes that the patent is valid and has been infringed by Apotex in making the omeprazole drug that is the subject of these proceedings, can at that time craft a remedy that is appropriate, having in mind any compensation awarded in these proceedings. It would be unconscionable for the present proceedings to come to a halt or for this Court to refuse to award compensation simply because another action on another patent was pending. To do so would be simply to encourage such actions to be brought. The best way to deal with the matter is as I have set out above.

Hughes J’s judgment on this point has now been affirmed by the FCA in brief reasons from the bench, quoting and agreeing with this paragraph [7-8].