PM(NOC) Statutory Stay Damages Regime is a Complete Code

Apotex Inc v Eli Lilly Canada Inc 2021 ONSC 1588 Schabas J

            2,041,113 / olanzapine / ZYPREXA

Under the patent linkage system established by the PM(NOC) Regulations, a patent that is ultimately held to be invalid can keep competitors off the market for two years by operation of the statutory stay pursuant to s 7(1)(d). If the generic prevails, s 8 provides a remedy in the form of damages for the losses suffered from having been kept off the market by the statutory stay. There are limitations to the s 8 remedy which are now clearly established. First, if the generic prevails in the s 8 proceeding, s 8 entitles it only to its own damages, and not disgorgement of the patentee’s profits: 2011 FCA 358 (here); 2013 ONCA 555 (here). Second, if the generic is unsuccessful in the NOC proceeding, it cannot claim s 8 damages, even if the patent is subsequently held invalid in an infringement action: 2013 FCA 282 (here). A number of actions have been brought in provincial superior courts pleading a variety of causes of action (other than s 8), seeking a way around both of these limits. So far, none of these attempts to avoid the limits on s 8 recovery have been successful, though some causes of action have survived a motion to strike. Other causes of action have been struck, or class certification refused on substantive grounds: see here for a summary as of Aug 2016, and here and here for discussion of two decisions since then. (I think that is a complete list, though I won’t make any promises.)

In this case, Apotex sought to avoid the second limit on s 8 damages. Lilly had prevailed in NOC proceedings against Apotex ( 2007 FC 455 affd 2008 FCA 44), but 113 patent was subsequently declared invalid in separate proceedings (2011 FC 1288 affd 2012 FCA 232): [10]–[23]. (As Schabas J noted [23], the 113 patent was invalidated on the basis of the promise doctrine—see here—which was subsequently abolished by the SCC in AstraZeneca 2017 SCC 36, so it appears that the 113 patent would be valid under current law. Nothing turned on this point.) Apotex had attempted to claim s 8 damages in Federal Court proceedings, and it was that litigation, culminating in 2013 FCA 282, that established that s 8 recovery is not permitted in those circumstances.

In this action, Apotex sought to recover damages for having been kept off the market on the basis of three causes of action: breach of the Ontario Statute of Monopolies; s 7(a) of the Trademarks Act; and common law conspiracy in restraint of trade [34]–[36].

Schabas J dismissed the action on a motion for summary judgment, holding that none of these causes of action raised a genuine issue for trial. There were two preliminary points: whether the matter should be dealt with by way of summary judgment (yes), and whether the limitations period had run (no), which I won’t address, as the former is not patent specific and the latter is only relevant to the old NOC proceedings.

Schabas J’s holding rested primarily on two general points.

First, the PM(NOC) Regulations are a “complete code” which comprehensively sets out the remedies available to the parties. The underlying NOC proceedings in this case were standard NOC proceedings of the kind that would have been directly within the contemplation of the legislature. To provide additional remedies which are not found in the Regulations, in circumstances that undoubtedly were contemplated by the drafters, would upset policy choices and balancing of interests arrived at by Parliament: [110] and generally [97]–[110], [114]. As Schabas J pointed out, this reasoning has been accepted in all of the highest authorities to consider the question in this context.

In my view this logic is sound. Since I’m an academic, I have to quibble a tiny bit. Schabas J stated a few times, including at the very outset of his analysis, that “patent law is ‘wholly statutory’” [97], [110]. Yes, that is quoting the SCC in Sanofi 2008 SCC 61, which in turn quoted Lord Walker’s decision in Synthon [2005] UKHL 59, but Apotex nonetheless is right to say that this is an “overstatement” [98]. For example, all of the law of utility, including the doctrine of sound prediction and its enhanced disclosure requirement (if that exists), and the prohibition of post-filing evidence, rests on a single word in the Act; the obviousness requirement was not in the code at all until 1993, despite having been part of the law for a century before that. The Supreme Court in Sanofi used this phrase to indicate two somewhat narrower points: first, that there is no common law right to a patent; and second, that specific statutory provisions will always prevail over judicially developed doctrines. Both of these points are unassailable, and neither rests on the notion that the Act is a complete code in a strong sense. Lord Walker’s statement in Synthon [57] is particularly curious:

The law of patents is wholly statutory, and has a surprisingly long history. It has been wholly statutory since the Statute of Monopolies 1623, an important landmark in constitutional history because of its effect in curbing the royal prerogative.

As Lord Walker states explicitly, the Statute of Monopolies did nothing but curb the royal prerogative. Even after the Statute of Monopolies, the basis for the grant in English law rested on the exercise of the royal prerogative and not on the statute: in principle, this was true in the UK until the Patents Act 1977. The Crown could, and occasionally did, refuse to grant patents for general policy reasons, such as protection of tax revenue, which had not even the slenderest basis in the Statute of Monopolies. Thus the very basis of the grant was not statutory. Moreover, the Statute of Monopolies itself is and was at the time generally considered to be a reflection of the common law. Indeed, Dr Fox has gone so far as to say that the Statute of Monopolies “was not by any means enacted as a patent statute having as its primary purpose the establishment of a system whereby letters patent might be obtained for meritorious inventions. It was enacted as the result of a long and turbulent agitation against the abuse of monopolies of all kinds as well as other grievances which are set out in the preamble to the Act”: Fox, “Abuse of Monopoly”(1945) 23 Can Bar Rev 353, 371. Consequently, Lord Walker’s statement that patent law “has been wholly statutory since the Statute of Monopolies 1623" is a bit of a stretch.

With that said, Schabas J’s decision does not rest on the view that the entirety of patent law is statutory. It rests on the much narrower ground that the balance of interests struck in the PM(NOC) Regulations, and the remedies provisions in particular, are a complete code for addressing the harm done by the statutory stay. That is the main point made by the authorities quoted and relied on by Schabas J. This narrower point is entirely compelling. The PM(NOC) Regulations were high profile enactments which were heavily lobbied. They reflect a political compromise between the interests of the generics and the innovators, and more broadly “a compromise between the interests of the public in encouraging research and development of new patentable drugs and in encouraging generics to market drugs at lower prices” [106]. I won’t multiply references on this point, as it is made in all of the decisions quoted by Schabas J, noting eg the “highly regulated” nature of this field [109].

I’ll add one point that wasn’t mentioned in the decision. It is widely recognized that the statutory stay "is tantamount to an interlocutory injunction": Bayer AG v Apotex (1993) 51 CPR(3d) 329 [13]. While the 1993 RIAS is not explicit, it appears that the NOC proceedings under the original regulations were broadly modeled on an interlocutory injunction application (in contrast to the deemed infringement approach under the US Hatch-Waxman system and under the new NOC proceedings). So, in addition to the stay, the proceeding was summary in nature, and the fact that the outcome had no in rem effect is also similar to an interlocutory injunction application. A defendant may also suffer loss from being enjoined by an interlocutory injunction if it turns out that the injunction was ‘wrongly’ (with the benefit of hindsight) granted, and it is very well-established that the party subject to an interlocutory injunction has no common law right to damages for its loss. This is because the loss is due to an order of the court, not the action of the plaintiff. The defendant will only be compensated if an undertaking is given, as is normally required. Section 8 damages play the role of damages on the undertaking; and to the extent that the proceedings were indeed modeled on an interlocutory injunction, the parallel implies that the background assumption is that there would be no recovery other than that provided for by s 8, just as there is no recovery for the harm caused by an interlocutory injunction apart from that provided for by the undertaking.

The second general point made by Schabas J is that Lilly cannot be made liable for exercising its statutory rights [113]–[118]. The direct cause of the loss to Apotex is the statutory stay. The stay is indirectly caused by Lilly listing the 113 patent, and then responding to Apotex’s NOA. While Lilly was not required to list the 113 patent, it was entitled to do so: “such acts ‘were the opposite of unauthorized’ and were acts that Lilly ‘was at liberty to commit’” [118], quoting Harris 2010 ONCA 872 [50] affg 2010 ONSC 2326 [94]. This is true “even if Lilly was motivated by an improper motive” (on which there is no evidence) [111].

This reminds me broadly of the US Noerr–Pennington doctrine, which is to the effect that it is not actionable under the antitrust laws to petition government to enact anticompetitive legislation, even if the intent is to eliminate competition: Noerr 365 US 127 (1961); Pennington 381 US 657, 670 (1965). The parallels are not exact, as Noerr and Pennington themselves are about petitioning government in the antitrust context specifically. But there is a broad parallel in the idea that petitioning the government in respect of legislation cannot be actionable in a democracy (Noerr 137–38), and similary taking advantage of one’s rights under legislation should not be actionable. The lower federal courts in the US have consequently expanded that immunity far beyond the antitrust context to a wide variety of claims: see Gugliuzza, Patent Trolls and Preemption, (2015) 101 Va L Rev 1579, 1611–12. Moreover, the Court noted in Pennington 671 that “it is clear under Noerr that Phillips could not collect any damages under the Sherman Act for any injury which it suffered from the action of the Secretary of Labor. The conduct of the union and the operators did not violate the Act, the action taken to set a minimum wage for government purchases of coal was the act of a public official who is not claimed to be a co-conspirator, and the jury should have been instructed, as UMW requested, to exclude any damages which Phillips may have suffered as a result of the Secretary’s Walsh-Healey determinations.” That is, if the direct cause of the injury is the operation of the legislation, the injured party cannot claim damages against the legislator, and any improper motive in petitioning for the legislation is vitiated by the intervention of the legislator itself. The principle applies not only to petitioning a legislative body, but also petitioning a court for relief, unless the litigation is a “sham”: see Professional Real Estate Inventors v Columbia Pictures 508 US 49, 56–58 (1993). More broadly, in the United States under Noerr-Pennington and related doctrines, a patentee is generally immune from civil liability for harm arising from assertions of infringement so long as the assertions are not (1) objectively baseless and (2) made with subjective ill intent: see Gugliuzza, Patent Trolls and Preemption, 1616–28. While there is room for debate about whether the precise contours of the US rule are sound as applied in the patent context (see Gugliuzza, arguing that threats made in bad faith should not be immune from liability), that is not relevant here as there is no question of objective baselessness or ill intent on the facts at hand. (Indeed, as noted above, the patent at issue would probably be valid under existing law.)

I’m not sure how much this parallel adds, but in any event, I do find the basic point made by Schabas J and Harris—that it cannot be actionable to take advantage of one’s statutory rights—to be entirely convincing.

It seems to me that these points are independent, and either would be sufficient to dispose of Apotex’s claim. The policy balance struck by the legislature happens to be triggered by the pharma innovator listing its patent; but even if there were some other trigger, the policy balance still shouldn’t be upset. Conversely, if listing is authorized under the Act, it shouldn’t give rise to liability, even if there weren’t a comprehensive balance backing it up. But that’s an issue for another day, as here the two principles did work in tandem.

So at this point there is a strong argument for dismissing Apotex’s action—and I haven’t even discussed the actual causes of action themselves, except in passing at the outset. Schabas J’s decision proceeded similarly: he apparently held that the claims were not tenable even before considering the specific causes of action [122], though he did go on to consider the specific causes of action, and concluded that none of them could be supported on the evidence or the law. While this approach is a bit unorthodox, it strikes me as sound. At the very least, the general principles establish that the claims should be dismissed unless examination of the specific causes of action shows some good reason to the contrary.

The first cause of action was for breach of s 4 of the Ontario Statute of Monopolies, which provides (in part),

If any person shall be . . . grieved . . . by [any] letters patents . . . tending as aforesaid, . . . the same person shall have his remedy . . . against him by whom he shall be so . . . grieved . . . and every such person . . . shall recover three times so much as the damages which he sustained by . . . occasion of being so . . . grieved

This is essentially identical to s 4 of the original English Statute of Monopolies (barring some transitional language in the original statute). As I understand it, there was some controversy as to whether various Imperial statutes affecting property and civil rights became part of the law of Canada ex proprio vigore. To resolve the uncertainty, “An Act respecting the Imperial Statutes relating to property and civil rights” SO 1902 c 13, was enacted, confirming that certain listed Acts were part of the law of Ontario. The Ontario Statute of Monopolies was made part of the RSO 1897 under the authority of that Act: see Fox, “Abuse of Monopoly” (1945) 23 Can Bar Rev 353, 363–64. The Ontario Statute of Monopolies has never been judicially considered until this recent spate of proceedings. Section 4 of the original English statute appears to have been judicially considered exactly once in the 400 years since it was enacted, in Peck v Hindes (1898) 15 RPC 113 (QB) (see 117 indicating that it was the first time the provision had been considered).

There are serious questions as to the validity of the Ontario Statute of Monopolies, which Schabas J found it unnecessary to address in light of his conclusion that the provision, even if validly enacted, did not support Apotex’s claim in the circumstances [127]–[130]. I’ll note that Dr Fox was firmly of the view that it was intra vires: see “Abuse of Monopoly” at 370–72

Apotex’s argument, as I understand it, is that Apotex was “grieved” by the 113 patent, by virtue of having been kept off the market. Section 6 of the Statute of Monopolies (s 5 of the Ontario Statute) provides that s 4 does not apply to any letters patents granted to the true and first inventor of for new manufactures; but this exception, so the argument goes, should be interpreted as only applying to valid letters patent, so that patents that granted but which are ultimately held to be invalid are subject to s 4. This is a purely textual interpretation of s 4, and it must be said that a purely textual parsing of an obscure 400 year old statute is a very slender ground for disrupting the legislative balance struck by the NOC Regulations.

The historical intent of s 4 is obscure. In Peck v Hindes, counsel argued at 124–25 that s 4 was aimed at extrajudicial enforcement of patent rights; that was not accepted (or rejected) by the court, and even if correct, that theory of s 4 would not support a cause of action on the present facts. Mathew J in Peck v Hindes concluded at 127 that s 4 did not apply at all to letters patent for invention. The famous s 6 of the original Act (s 5 of the Ontario Statute, as s 5 of the original Statute was transitional), the foundation of the law of patents, provides an exception for letters patent for invention in the following terms: “any declaration before mentioned” —including s 4—”shall not extend to any letters patents. . . made. . .of the sole working or making of any manner of new manufactures.” The Court in Peck v Hindes observed that “Section 6 does not say anything about valid Letters Patent. It says, Letters Patent for new inventions” (127). Schabas J agreed with this holding [135].

The only scholarship I have been able to find that considers the effect of s 4 is series of articles by Dr Fox, primarily “Abuse of Monopoly”(1945) 23 Can Bar Rev 353; and see also “Patents in Relation to Monopoly” (1946) 12 Can J Econ Pol Sci 328; Fox, “Patents in Relation to Monopoly: A Rejoinder” (1947) 13 Can J Econ Pol Sci 68-80. Fox argues that s 4 was intended to address unjustified threats of legal proceedings, similar in spirit to the UK Intellectual Property (Unjustified Threats) Act 2017, and which are normally dealt with in current Canadian law under s 7(a) of the Trademarks Act: see here and here. While Dr Fox’s theory was not considered by Schabas J, Fox’s conclusions are entirely consistent with his reasons. Fox agreed with the holding in Peck v Hindes, saying that it is authority for the proposition that “an action for infringement of a patent, whether valid or invalid, does not give rise to the action contemplated by sec. 4” (370, my emphasis); and similarly, on the authority of Peck v Hindes, "a person could not be penalized for bringing action in a court of law to support his letters patent even though he were unsuccessful” (369). Fox goes on to argue that “nevertheless he could be and would be penalized if he endeavoured to use his patent as a club held in terrorem over the heads of his competitors, and by so doing grieved, disturbed or disquieted those persons, by methods other than bringing the matter for hearing and determination before a court of law” (369). Whether Fox is right as to the intent and effect of s 4 is a question that we need not resolve here; it is enough to say that on Fox’s view, s 4 would clearly not allow recovery for damages in the circumstances of this case.

It is also worth noting that Fox explicitly agreed with Schabas J’s second general point: “No person can be penalized, other than by costs, for bringing an action to support what he considers to be a legal right” (372). This observation illustrates that s 4 is not in tension with the general principles set out by Schabas J; on the contrary, it can, and should, be interpreted harmoniously with that basic principle.

The next cause of action raised by Apotex is based on s 7(a) of the Trademarks Act, which is breached when one makes “a false or misleading statement tending to discredit the business, goods or services of a competitor.” Apotex argued that the false statement by Lilly lay in listing the 113 patent on the Patent Register, which entailed a representation that the '113 Patent was valid and enforceable [139]. Schabas J noted that “there is nothing untrue or false in any material respect, let alone disparaging or discrediting of Apotex, in the Form IV. At the time it was completed, Lilly did have the 113 Patent for Olanzapine. That is essentially all that was stated” [141].

Apotex’s final cause of action is common law conspiracy, which alleged a conspiracy to fix monopolistic prices. This was premised entirely on Lilly applying for a patent and listing on the register, which Lilly was perfectly entitled to do. There was no suggestion of improper conduct, other than obtaining a patent that was ultimately held to be invalid; this cannot constitute a conspiracy.

Finally, I note that Schabas J did not hold that use of the litigation process can never give rise to civil liability, but rather that any such liability must be based on a “stand alone cause of action” or a claim “totally independent of the regulatory regime”: [115], adopting the language of Apotex v Eli Lilly 2015 ONCA 305 [53] and 2013 ONSC 5937 [8]. Schabas J did not elaborate, as there was no allegation capable of supporting any independent ground, but in my view, groundless threats of infringement, that were the concern of authors such as Dr Fox and Prof Gugliuzza, would certainly fall into that category. There is therefore not the slightest conflict between Schabas J’s holding and the FC decisions, mentioned above, dealing with unjustified threats under s 7(a) of the Trademarks Act.

PS — Various similar actions are also before the courts at various stages of case management. In a case management decision in one such matter, Apotex Inc v Pfizer Ireland Pharmaceuticals 2021 ONSC 1860 Myers J adjourned a trial set for September in light of Schabas J’s decision in this case, and instead ordered that the matter be decided by way of a motion for summary judgement.

The Threshold for Demonstrated Utility

Apotex Inc v Janssen Inc 2021 FCA 45 Locke JA: Webb, Boivin JJA affg Janssen Inc v Apotex Inc 2019 FC 1355 Phelan J

            2,661,422 / abiraterone acetate & prednisone / ZYTIGA / old NOC

The invention at issue in this case relates to the use of the combination of abiraterone acetate (AA) & prednisone for the treatment of prostate cancer. Today’s post will discuss the utility aspects of this decision, which touches on three different issues: (1) the nature of the utility requirement for a combination, (2) the requirement to disclose the factual basis for a sound prediction; and, (3) most importantly, the threshold for demonstrated utility namely that it is sufficient if the results are “strongly suggestive” of utility, and no other explanation is likely. (See Monday’s post on obviousness.)

Yesterday’s post sets out the facts in more detail; for this post it is enough to say that androgen produced in the adrenal gland promotes the growth of certain types of prostate cancer and AA was a known adrenal androgen inhibitor, albeit a relatively new one. Most adrenal androgen inhibitors also suppressed other adrenal hormones, such as glucocorticoids; this caused side effects which were treated by co-administration of a glucocorticoid, such as prednisone. AA had an unusual mechanism of action, and at the filing date it was thought that AA would not require co-administration of a glucocorticoid to reduce side-effects; instead, the inventors though that prednisone would have a synergistic effect with AA in treating the cancer itself. As it turns out, that theory was mostly wrong, but not entirely wrong: AA does cause side effects, and prednisone is co-administered for that reason, not for its synergistic effects in cancer treatment, but Phelan J did find that there is also a small synergistic effect.

Utility requirement for a combination

As discussed here, for a combination invention there is a question as to whether the utility requirement is satisfied if the combination has a scintilla of usefulness in treating the disease, or if there has to be a scintilla of a synergistic effect, such that the combination is at least marginally better than the sum of the individual effects. The combination at issue clearly had utility on the simple usefulness test ([218]–[219], but Phelan J proceeded on the view that a scintilla of synergy was required: see eg [219]-[221]. Phelan J found that there was a scintilla of utility even with a synergy requirement, though it was a much closer call.

Locke JA’s decision on appeal proceeded on the same assumption as Phelan J, ie that synergy was required, but without specifically affirming that this was the correct approach as a matter of law: see [43], [45]. My impression is that the point wasn’t argued at either the FC or FCA level; for example, the reference to the synergy requirement at [43] was literally parenthetical. I hope this means that the point shouldn’t be considered settled; but I recall how the promise doctrine started with a few statements that weren’t really challenged in complex litigation where there was a lot else going on, until by the time it was directly addressed, it was considered settled.

Enhanced Disclosure Requirement for Sound Prediction

The evidence relied on to establish utility was two trials, referred to as “Study 001" (AA and a different glucocosticoid, namely dexamethasone, in human subjects) and “Study 004” (AA and prednisone, also in human subjects), collectively the “Cougar trials.” The hypothesis that the combination of AA and a glucocosticoid such as prednisone would have a synergistic anti-cancer effect was referred to as “de Bono’s hypothesis” after one of the inventors [40]; this was the line of reasoning that would connect the trial data to the utility.

At first instance Phelan J held that Janssen could not rely on these trials or the de Bono hypothesis to establish a sound prediction of utility because “no part of de Bono’s hypothesis or the Cougar studies were disclosed in the 422 Patent and therefore Janssen cannot rely on sound prediction” [223]; and see [212]. Without the enhanced disclosure requirement, a sound prediction of utility would “likely” have been made out [223]. Thus this was a case in which the enhanced disclosure requirement played a real role. I had somehow missed this when blogging on Phelan J’s decision, so I’ll make a few comments on Phelan J’s decision at the end of this post. For now I’ll say that while there is certainly FCA caselaw directly endorsing the enhanced disclosure requirement, as Phelan J noted [223], in Sanofi-Aventis v Apotex / clopidogrel 2013 FCA 186 [132] Gauthier JA raised serious concerns about the doctrine. In this case, there was no challenge on appeal to Phelan J’s holding on sound prediction [38], but towards the end of the decision Locke JA quoted from my article “Must the Factual Basis for Sound Prediction be Disclosed in the Patent?” (2012) 28 CIPR 38, and remarked “For the purposes of the present appeal, it is not necessary to address the question posed in the title of Prof. Siebrasse’s article” [50]. Maybe it’s wishful thinking, but I’ll take this as a hint that there may be room to revisit this issue at the FCA level; the only other FCA decision to touch on the point after Gauthier JA’s comments in Clopidogrel, namely Eurocopter 2013 FCA 219 [153], waffled a bit by saying that disclosure in the specification “may” be required to support a sound prediction of utility.

Demonstrated Utility

While Janssen could not rely on the Cougar trials and the de Bono hypothesis to establish sound prediction, Phelan J held that the same data, in conjunction with previous studies on the anti-cancer effects of prednisone, was sufficient to demonstrate utility [FC 221].

The FCA affirmed. Locke JA’s reasons rested on three points of law or principle, combined with a deferential standard of review.

An initial point of law is that neither study was sufficient on its own to demonstrate utility, but Phelan J held that the combination did. Locke JA affirmed that “testing should be considered cumulatively when assessing demonstrated utility” [41], citing with approval Teva v Novartis / imatinib 2013 FC 141 [215]–[216].

Secondly, while the 004 Study tested AA in combination with prednisone [FC 43], the endpoint was not survival rate, but rather prostate specific antigen (PSA) response, which is “a surrogate measurement for the effectiveness of prostate cancer treatments” [FC 19]. The claims were to the combination “for the treatment of a prostate cancer in a human” [FC 38], and Apotex argued that a study using a surrogate could not demonstrate the claimed utility, but would merely provide the factual basis for a prediction of utility [47].

In response, Locke JA first noted that “the Federal Court found, as a fact, that PSA indicated the response to prostate cancer in 2007: Reasons, para. 19. This suggests that a reduced PSA level can be a demonstration of utility in fighting cancer” [48, original emphasis]. The general point, as I understand it, is that even when we consider a fact to be demonstrated, we don’t necessarily directly observe it directly. The Higgs boson is said to have been observed, but what was directly perceived is a peak in the output of a particular detector, which, combined with a suitable statistical analysis, allowed the CERN scientists to say, with a very high degree of confidence, that the existence of the Higgs boson has been established. If we say it has been shown that an antibody binds to an antigen, what is directly observed will likely be a colour change, which, combined with a theory about the conditions under which the colour will be observed, allows us to infer the binding. Even in an RCT in humans, the strongest way of demonstrating utility of a drug, we don’t directly observe the drug curing the disease; what is observed is the disease symptoms in the control and treatment groups, and this, combined with suitable statistical analysis, may allow us to infer that the drug treats the disease. There is no magic in “statistical significance” with a p-value of 0.05, as the replication crisis in social psychology shows; physicists require 5-sigma significance for important discoveries.

Thus Apotex’s objection is correct in a way; the use of the PSA really only allows us to predict—or more accurately, infer—that the combination is effective in treating prostate cancer. But the same would be true even if survival had been used as an endpoint; any conclusion that the combination worked to treat prostate cancer would be an inference based on a statistical analysis of the observed outcomes, which would allow for the role of chance, placebo effect and so on. Depending on the strength of the correlation between PSA levels and prostate cancer, it might well be that a high-powered study using PSA levels would give a greater degree of certainty than a low-powered study measuring survival rate. While the established doctrinal test for sound prediction requires a factual basis and a sound line of reasoning, the same is true for demonstrated utility, even though that point is not expressed as a formal test. There is no sharp difference in kind between a sound prediction of utility and a demonstration thereof; the difference is only the confidence with which we are prepared to draw the inference of causation. So, the fact that the 004 Study used PSA as a criterion rather than studying the survival rate itself does not mean that it cannot demonstrate utility, in the same way that the fact that CERN used statistical analysis of detector energy spectrum rather than direct visual perception does not mean that the Higgs boson has not been observed. The question as to whether utility has been demonstrated rather than soundly predicted does not turn on the nature of the tests that were carried out.

So, it makes sense in principle that the claimed utility need not be directly measured in order to be demonstrated. The question then is to decide how strong the inference must be in order to demonstrate utility, as opposed to merely predicting it. Locke JA held that utility need not be established with certainty in order to be demonstrated [49]:

It is sufficient that the test results are strongly suggestive of utility, and that there is no other logical explanation for the test results is likely.

Finally, Locke JA stated that “More broadly. . . it must be acknowledged that it is difficult to draw a clear line between a demonstration of utility and a prediction of utility” [50]. He went on to quote a passage from my article “Must the Factual Basis for Sound Prediction be Disclosed in the Patent?” (2012) 28:1 CIPR 38, in which I argued that there is no basis for distinguishing between the two. He then concluded that he would not intervene with Phelan J’s decision, “[b]earing in mind the vagueness of the line between prediction and demonstration,” combined with the evidence relied on by Phelan J, and in light of the applicable (deferential) standard of review [51].

Locke JA did not explain exactly why the vagueness of the distinction between demonstration and sound prediction was relevant in upholding Phelan J’s finding that utility had been demonstrated. I made the point in my article to argue that because there is no sharp distinction in reality, there should be no sharp distinction in doctrine; either disclosure of the factual basis should be required for both demonstrated utility and sound prediction, or for neither. That is evidently not how Locke JA is invoking the argument, given that his decision proceeded on the assumption that there is an enhanced disclosure requirement for sound prediction and not for demonstrated utility. I think that what Locke JA was saying is that given that current doctrine establishes a line that is vague, as Locke JA put it—or not grounded in reality, as I might prefer to say—the law should not be too alert to enforce that boundary strictly, so as to avoid arbitrary results. Put another way, the threshold for demonstrated utility should be applied flexibly, given the drastic legal consequences of a vague and arguably arbitrary distinction. This is consistent with GSK/rosiglitazone 2011 FC 239 [98], for example, in which the utility of a claim to the compound rosiglitazone was held to be demonstrated on the basis of potential use for treatment of hypoglycaemia.

While this all makes sense, it does illustrate that the law faces a struggle in adapting to the enhanced disclosure requirement. Ultimately, the FCA will have to deal with the issue head-on. When that time comes, this decision will be an important part of the context.

Phelan J’s discussion of the enhanced disclosure requirement

As noted above, Phelan J proceeded on the view that there is an enhanced disclosure requirement, applicable to sound prediction but not demonstrated utility, such that the factual basis and line of reasoning to support a sound prediction must be disclosed, or at least referenced, in the patent itself. There is certainly FCA caselaw expressly so holding: see Lilly v Apotex / raloxifene 2009 FCA 97 [15]; Lilly v Teva / atomoxetine 2011 FCA 220 [46]–[47]. Subsequently, however, in Sanofi-Aventis v Apotex / clopidogrel 2013 FCA 186 [132] Gauthier JA raised serious concerns on this point in her concurring reasons, though that of course does not in itself overrule the prior FCA holdings; at most, it suggests that there might be some appetite to reconsider the issue in the future. So Phelan J was on firm ground in taking this position. With that said, I have a couple of concerns about his analysis. He didn’t refer specifically to either the Raloxifene or Atomoxetine decisions, but they were evidently the premise of his analysis. His discussion of the relevant case law was as follows:

[222] The Supreme Court of Canada stated in Apotex Inc v Wellcome Foundation Ltd, 2002 SCC 77 at para 70, [2002] 4 SCR 153, that sound prediction requires a factual basis, line of reasoning, and disclosure of the prediction in the patent.

In my view, it is not correct to say that the SCC in Wellcome / AZT held that disclosure of the factual basis is required in the patent. The passage was cryptic and was expressly obiter. That doctrine is really the product of the FC / FCA interpretation of that passage, particularly in Raloxifene. I also have to point out that while the SCC said in Wellcome / AZT that “both the underlying facts (the test data) and the line of reasoning (the chain terminator effect) were in fact disclosed,” that statement is incorrect.

Phelan J went on to say:

Although some commentary has suggested the Supreme Court of Canada may have overturned this statement, the Federal Court of Appeal in Bell Helicopter Textron Canada Limitée v Eurocopter, société par actions simplifiée, 2013 FCA 219 at paras 152-155, 120 CPR (4th) 394, confirmed that where the factual basis and line of reasoning are based on data that is not part of the common general knowledge, then disclosure is likely required to support sound prediction.

I believe the first sentence refers to some commentary suggesting the SCC in AstraZeneca 2017 SCC 36 overturned the enhanced disclosure requirement. I recall seeing that commentary, but I can’t find it or a case referring to it (if any reader can point me to it in a comment, I’d appreciate it.) In any event, I agree with Phelan J that the AstraZeneca decision does not affect the issue one way or the other.

My own view isn’t that the SCC overruled itself in AstraZeneca, it’s that Wellcome / AZT never established an enhanced disclosure requirement in the first place. The SCC’s statements in Teva 2012 SCC 60 are more to the point. The SCC stated at [37] that

The lack of certainty that comes from predicting rather than demonstrating an invention’s utility has led some courts to conclude that there is a “heightened” or “enhanced” disclosure requirement in cases in which a claim of utility is based on sound prediction: see, e.g., Eli Lilly Canada Inc. v. Apotex Inc., 2009 FCA 97, 78 C.P.R. (4th) 388, at paras. 14-15.

Notably, the SCC did not cite its own decision in Wellcome / AZT as suggesting an enhanced disclosure requirement. The SCC in Teva concluded its discussion of this point by saying “Since sound prediction is not an issue, the question whether there is an ‘enhanced’ or ‘heightened’ disclosure requirement with respect to sound predictions does not arise in this case and need not be addressed” [43]. The SCC did not say “We need not consider whether we should overrule our holding in Wellcome / AZT.” In my view, it is clear that the SCC does not consider that it established an enhanced disclosure requirement in Wellcome / AZT; I am quite certain that if the matter ever did go to the SCC, the Court would not consider that the question was whether it should overrule its own precedent, but rather whether it should overturn a rule established by the Federal Courts.

Obvious-to-Try Clarified

Apotex Inc v Janssen Inc 2021 FCA 45 Locke JA: Webb, Boivin JJA affg Janssen Inc v Apotex Inc 2019 FC 1355 Phelan J

            2,661,422 / abiraterone acetate & prednisone / ZYTIGA / old NOC

The invention at issue in this case relates to the use of the combination of abiraterone acetate (AA) & prednisone for the treatment of prostate cancer. Wednesday’s post provides an outline of the facts and a discussion of patentable subject-matter. This post discusses the obviousness analysis, where the main point of interest is a clarification of the obvious-to-try analysis set out in Sanofi 2008 SCC 61.

Apotex argued that Phelan J had not applied the obvious-to-try analysis correctly because he had focused unduly on the question of whether it is “more or less self-evident that what is being tried ought to work” and had erroneously considered that question to be a requirement rather than merely a factor to be considered [30]. Locke JA agreed that that question is merely a factor, not a requirement, and noted that there were passages which gave the impression that Phelan J had indeed considered this to be the overarching requirement [33]. However, on a reading of the decision as a whole, Locke JA concluded that Phelan J had properly considered all of the relevant factors [34] and he therefore affirmed Phelan J’s holding that the invention was not obvious.

Locke JA noted that some confusion was understandable, as the SCC had given “mixed signals” on the issue [36]. He pointed out that the SCC in Sanofi at [65] stated that “I am of the opinion that the ‘obvious to try’ test will work only where it is […] more or less self-evident that what is being tested ought to work.” This makes it seem that being self-evident that what is being tested ought to work is a requirement, such that if the answer is no, the invention is not obvious [36]. But the SCC at [69]–[70] clearly listed the same consideration as being simply one factor among several, which is not in itself determinative. In this decision, Locke JA reaffirmed his view, previously expressed in Hospira 2020 FCA 30 [88]–[90], that read as a whole, the SCC in Sanofi intended that whether it is self-evident that what is being tried ought to work should be considered as a factor, and not a requirement [36].

I agree with Locke JA’s analysis, which strikes me as being consistent both with the purpose of the obvious-to-try analysis and with a contextual analysis of the text. In a passage in Hospira, quoted at [31], Locke JA had pointed out that the SCC in Sanofi [66] had stated that whether it is “more or less self-evident to try to obtain the invention”—as distinct from whether it is self-evident that it will work—is a requirement. If the particular solution arrived at by the inventor was not obvious to try, then it cannot have been obvious, as the inventive step lay in the very decision to try pursuing a line of research that would not have occurred to a skilled person.

If the inventor’s solution was obvious to try, things get more complicated. One might suppose that even if the solution was obvious to try, if it was not self-evident that it ought to work, the invention would therefore be non-obvious, as there is a non-obvious step along the path from the problem to the solution. That logic supports the view that being self-evident that it ought to work is a requirement. But that logic is wrong, as is illustrated by Johns-Manville’s Patent [1967] RPC 479 (CA). The claimed invention was the use of a particular compound, polyacrylamide, as a flocculating agent for filtration of cement. Flocculating agents were well known as being useful in filtration processes generally and the possibility of using such an agent to improve filtration of cement had long been appreciated, but all those previously tried had decreased the quality of the final cement product. Polyacrylamide had been recently developed by a third party as a general flocculating agent and its use in cement filtration had been suggested. Because it was particularly effective and could be used at low concentrations, there was reason to think that it would prove useful for cement where other agents had not. However, the nature of cement making is such that nothing is certain until it is tried. It was therefore self-evident to try polyacrylamide as a flocculating agent in cement, but it was not more or less self-evident that it would work. The patentee tried polyacrylamide and found that it did indeed work without difficulty.* The Court of Appeal held the invention to be obvious: there was no invention in the decision to try, and there was no invention in getting it to work. This illustrates why being “more or less self-evident that what is being tested ought to work,” should not be a requirement; and given that Johns-Manville’s was cited with approval in Sanofi [59], [61], this reinforces Locke JA’s point that read as a whole, the SCC did not intend it to be a requirement. The flaw in the logic set out at the beginning of the paragraph lies in supposing that there must be an inventive step in carrying out an experiment, simply because the outcome cannot be predicted in advance. Johns-Mansville illustrates why that assumption is not correct.

While not a requirement, whether it is self-evident that the solution ought to work is nonetheless a factor; if the invention was obvious to try, and it was self-evident that it would work, then it is almost certainly obvious. But the converse is not true; if the invention was obvious to try, and not self-evident that it would work, the other factors come into play. If it is tried and works readily with routine methods, as in Johns-Manville, or in a routine salt-screen, then it will be obvious, even if the outcome was not predictable in advance; if it is tried and eventually works, but only after long and arduous trials, or after unforeseen hurdles are overcome, then it may not be obvious. (And because being obvious to try is a requirement, if it was not obvious to try in the first place, it will not be obvious, even if it was self-evident that it would work once the idea was conceived of.)

I must say that I have always found the discussion of the obvious-to-try analysis in Sanofi to be oddly elusive; it makes sense at first, but then the more you try to pin it down to a structured test, the less sense it makes. Locke JA’s decision is very helpful in pinning down one source of the of the confusion, and properly laying it to rest.

*In fact, polyacrylamide had not worked when the patentee had initially tried it, but it was held that it would have worked had a person skilled in the art tried it, and it was the patentee’s incompetence that had led to the initial failure. The patentee was obliged to accept this position, as the patent did not disclose the particular procedure the patentee had successfully implemented and if the procedure was not obvious then the patent would have been void for insufficiency.

Patentable Subject-Matter and Combinations

Apotex Inc v Janssen Inc 2021 FCA 45 Locke JA: Webb, Boivin JJA affg Janssen Inc v Apotex Inc 2019 FC 1355 Phelan J

            2,661,422 / abiraterone acetate & prednisone / ZYTIGA / old NOC

In this decision Locke JA for the FCA has affirmed Phelan Js decision under the old NOC regulations that Janssen’s 422 patent, to a combination of abiraterone acetate and prednisone for the treatment of a prostate cancer, to be valid and infringed by Apotex’s APO-ABIRATERONE product: see here and here for discussion of Phelan J’s decision. Locke JA's decision on appeal is relatively brief, but there are important developments in respect of demonstrated utility, a significant clarification of the obvious-to-try analysis, as well as observations on patentable subject-matter as it relates to combinations.

In this post I’ll outline the facts and discuss patentable subject-matter: the key point is simply that there is an open question as to whether a synergistic effect is required for a combination to constitute patentable subject-matter.

The technology is complicated [6], and I’m not sure the facts outlined below are entirely accurate, but I believe it is good enough to understand the issues. 

Facts

The invention relates to a treatment for prostate cancer, in particular a combination of abiraterone acetate and prednisone. Testosterone, produced primarily in the testes, was known to promote the growth of cancer cells. The primary treatment for prostate cancer was therefore suppression of androgens, specifically testosterone, in the testes. [7] However, testosterone is also produced in the adrenal gland, and patients will often see a resumption in the progress of their cancer even after testicular androgen production is suppressed. This is known as castration resistant prostate cancer (CRPC) [7].

It was known that CRPC could be treated by suppressing residual androgen production in the adrenal gland using adrenal androgen inhibitors, such as ketoconazole (KC) and aminoglutethimide (AG) [8]. However, the adrenal gland also produces other hormones, such as glucocorticoids, and suppression of androgen production in the adrenal gland could cause serious side effects due to suppressed glucocorticoid production [8]. Consequently, glucocorticoid replacement therapy, by co-administration of a glucocorticoid, such as prednisone and dexamethasone, was known to be desirable to minimize the side effects [9].

Abiraterone acetate (AA) was a known adrenal androgen inhibitor, though it seems to have been relatively new at the relevant time. It was known to have a different mechanicism of action from KC and AG, and consequently was not expected to require glucocorticoid replacement therapy [10]. The 422 patent claimed the combination of AA and prednisone for the treatment of prostate cancer [FC 38]. Apotex is seeking to market AA, but the product monograph will instruct that it be used in combination with prednisone, so inducing infringement [55]–[58] if the claims are valid.

On validity, Apotex argued (inter alia) that administering prednisone with an adrenal androgen inhibitor was known to be desirable, AA was an adrenal androgen inhibitor, and so it would be obvious to administer prednisone in combination with AA. Phelan J rejected this on the basis that AA’s different mechanism of action meant that it was not obvious that AA would have side effects that would require glucocorticoid replacement therapy with prednisone [FC 197]. This is even though, as it turns out, AA does have side effects, and glucocorticoid replacement therapy is required, and that is in fact why prednisone is administered in combination with AA in clinical practice today [5].

Even so, just throwing in prednisone along with AA would not constitute invention. Janssen argued that the combination was inventive because the inventors had discovered that, surprisingly, prednisone was useful in combination with AA because of synergistic anti-cancer effects, and not merely to treat side effects. Phelan J found that even though prednisone is in fact co-administered primarily to treat the side effects, there is a scintilla of synergistic effect [221].

As I noted in my post on Phelan J’s decision, “The result is that Janssen is able to prevent Apotex from marketing abiraterone in combination with prednisone to control side effects, on the basis of a mostly wrong ‘discovery’ that prednisone acts synergistically with abiraterone.”

Patentable Subject Matter

As discussed here, at first instance Phelan J indicated that in the case of a combination invention there is a requirement for a synergistic effect as a matter of “patentable subject matter” [132]. In my post I had suggested that any requirement for synergy in a combination should be addressed as a matter of obviousness, and not by a distinct requirement of patentable subject matter. Janssen made a similar argument in the FCA [21]. Locke JA remarked that the argument “is an interesting one,” but “this is not the case to decide the issue,” as Phelan J had accepted that there was a synergistic effect, and the point would not affect the outcome [22]. This is very welcome, as it shows that there is a live issue as to whether there is a separate subject-matter requirement in respect of combination inventions. The point can therefore be addressed in a suitable case without assuming that the law is settled.

While that’s all that can be drawn from this decision, I can’t resist the urge to elaborate on the issue. As I understand it, when patentable subject matter arises as a separate requirement, it means that the claimed subject-matter is of a nature that it cannot be patented, even if it is new, useful, non-obvious and fully disclosed. That was the case, for example in Harvard Mouse 2002 SCC 76, where a claim to an a “transgenic mouse” was held to be unpatentable, even if it was new, useful, inventive and fully disclosed. Similarly, it is substantively controversial whether methods of medical treatment—such as a claim of the form “use of compound X in range from A to B to treat disorder Y”—are patentable subject-matter, but the debate itself turns on the same concept of patentable subject-matter as Harvard Mouse; whether claims to subject-matter of that nature are unpatentable, even if the claimed subject-matter is new, useful and non-obvious.

I have difficulty seeing that kind of issue here. I think it is clear that a combination of the type claimed in this case may be patented. For example, suppose the cause of castration resistant prostate cancer was entirely unknown, and in a scientific breakthrough the inventors had discovered that the source was adrenal androgen production; they realized that AA could inhibit that production, and they also did enough testing to discover the side-effects, and realized that adding prednisone would relieve those side effects. On those facts, the combination of AA and prednisone would be new, useful and inventive, and I think it is uncontroversial a claim of exactly the same form as was at issue in this case would be patentable subject-matter. If that is right, then the objection on the facts in this case is not based on the same type of subject-matter objection that was addressed in Harvard Mouse. Another type of subject-matter objection is the rule against abstract claims, set out in s 27(8); but the claims in this case are clearly not abstract. So if there is actually a subject-matter objection here somewhere, it is of an entirely new type. As suggested in my previous post, rather than making up a new kind of subject-matter objection, the better way to proceed is treat the matter as a question of obviousness.

Locke JA also remarked that “An aggregation is problematic because it does not provide more than was already available to the public,” and in this case “there is no dispute that the combination in issue provides improved results over what was previously known” [23]. This seems right to me on the facts of the case, but I would suggest that the question should be simply whether the combination was obvious; this implies that while improved results are relevant — a combination that gives exactly the same results as the individual components is unlikely to be inventive—but it is not necessarily determinative. It may be obvious that the combination will give improved results, as when an adjuvant is used in combination with a vaccine, but that does not mean that the combination of a well-known adjuvant with an existing vaccine is inventive. Alternatively, it may be obvious to use the combination for other reasons, and the improved results is a “golden bonus” that does not transform the obvious into the non-obvious. In either of these scenarios, the claimed invention might be obvious even though it gives improved results.

On appeal, Apotex argued that in the case of a combination invention, the comparison should not be with the results of either drug alone, but with “the sum of the two component drugs” [19]. I’m not sure I understand this argument, which was set out only briefly, and in any event Locke JA rejected it [22]–[23].

Essential Reading on Costs

Allergan Inc v Sandoz Canada Inc 2021 FC 186 Crampton CJ

2,507,002 / silodosin / RAPAFLO / NOC

This costs decision by Crampton CJ provides an extremely helpful summary of costs principles in patent litigation at [19]–[36] and it will no doubt be the “go to” decision for costs awards going forward. Crampton CJ's discussion will be essential reading, so I’ll simply flag it without further comment.

The underlying decision is 2020 FC 1189 (discussed in posts here and here). 

PS: The following remark is of particular interest (my emphasis):

 [28] In recognition of the fact that Tariff B no longer provides an adequate level of partial indemnification, the Federal Courts Rules Committee decided in 2016 that the amount recoverable under Tariff B should be increased by approximately 25%: Minutes of the October 28, 2016 Meeting of the Rules Committee. Following a further consultation with the bar, a sub-committee of the Rules Committee is preparing proposed amendments for publication in Part I of the Canada Gazette and approval of the Governor in Council.

Something to look forward to.

Whether Public Viewing Amounts to Enabling Disclosure is Context Dependent

Betser-Zilevitch v PetroChina Canada Ltd 2021 FC 85 Manson J

            2,584,627 / Steam-Assisted Gravity Drainage

In this decision, that turned primarily on claim construction, Manson J held the 627 patent to be valid but not infringed. There is no new law, but the decision illustrates that the claims may be construed with reference to the function of the invention, and that whether public viewing of the prior art amounts to prior disclosure is context dependent.

The 627 Patent generally relates to a modularized (Steam-Assisted Gravity Drainage) SAGD well pad for heavy oil (bitumen) production [10]. A “well pad” is a collection of well pairs used in extraction of heavy oil production. “Modularized” means that the well pad is made off-site in modules that are then transported to the well site and assembled. This is in contrast to “stick built” well pads that are entirely constructed on-site. Construction of a well pad is a major undertaking that takes months. The main advantage of modularization is reduced costs flowing from reduced on-site construction costs [7]. The well pad has several levels, which, as I understand it, are like floors in a building, except that the levels are open. The key aspect of the 627 patent was that the main flow lines were on the “first level” [12], [116], [117].

In the defendant’s allegedly infringing well pads the production flow lines were located on a higher level, which requires scaffolding for workers in the field to access, and not on the lowest level [135]. The key claim construction issue was therefore as to the meaning of “first level” in the claim. The experts disagreed as to the meaning of the term. In light of the “ambiguity” in the claims, Manson J held that the term “would be understood with reference to its functions and objects, as provided in 627 Patent specification” [116]. The object was to constrain the placement of the flow lines at a level such that they would be connected without the need for scaffolding, thus improving safety and reducing costs [116]–[118]. This illustrates that reference to objective of the invention may be useful to construe the claims.

Because Manson J held that there was ambiguity, he didn’t need to address the question of whether recourse to the disclosure is appropriate even in the absence of a finding that the claims are ambiguous. I can’t resist digressing on this point. In my view, recourse to claims is always appropriate: as Lord Hoffmann pointed out in Kirin-Amgen [2004] UKHL 46 [33], the skilled person “reads the specification on the assumption that its purpose is both to describe and to demarcate an invention.” Words take their meaning in part from the context in which they are used; the common general knowledge is part of the context, and I can’t think of any reason why the disclosure should not also be considered part of the relevant context. Since the disclosure and claims are both part of the specification, a skilled person reading the claims would have to make an effort to avoid seeing the disclosure, and I can’t think of any justification for such an artificial approach. In this case, Manson J found an ambiguity allowing recourse to the specification on the basis of a disagreement between the experts as to the meaning of the terms. If that is all it takes, then we might as well just recognize that consideration of the disclosure is always appropriate in claim construction.

An issue that arose in respect of obviousness was the relevance of prior art modularized well pads that had been transported on public roads and parked uncovered in a public parking lot [159]. The patentee argued that that “[m]erely viewing, without more” is not enough [164] relying on Bombardier 2017 FC 207 [490]. Manson J noted that “The degree of scrutiny required upon visual inspection is context specific. The level of scrutiny required to discern the external elements of a skate in a public arena, as in Bauer Hockey FC [2010 FC 361], above is evidently higher than the scrutiny required to view the components of a large SAGD module” [165]. The point, as I understand it, is that in order to be set up in an anticipation or obviousness attack, the prior art must have been become “available to the public” before the relevant date, and the information which is the quid pro quo for the patent is made available only if the requirements for enabling disclosure are satisfied. A view from a distance of a well pad in which flow lines are visible may be an enabling disclosure, even though a view from a distance of hockey skates does not provide an enabling disclosure of the details of the fabrication method.

PM(NOC) Related Rights of Action not Subject to Limitation Period

Merck Sharp & Dohme Corp v Sandoz Canada Inc 2020 FC 1180 Southcott J

2,518,435 / sitagliptin / JANUVIA

I believe this is the first decision addressing s 8.2 of the PM(NOC) Regulations, which provide for “Related rights of action,” as described by the RIAS. In particular, s 8.2 provides that “[o]n receipt of a notice of allegation” the patentee may bring an action for infringement of a patent, other than the patents that are set out in the NOA, that could result from the grant of an NOC. The RIAS explains that “Such patents can create legal uncertainty if there is risk that they could be infringed by the generic product. To facilitate legal consideration of such patents without expanding the scope of proceedings under the proposed Regulations, related rights of action are proposed.” The RIAS refers by way of example to patents claiming chemical intermediates or processes for making a drug, which may be infringed by the sale of a particular drug but which are not eligible for listing. A quick look at the patent at issue in this case suggests that it falls into both these categories, as being a process for making intermediates.

The question raised in on this motion is whether s 8.2 is subject to a limitation period, in the same manner as the primary provision, s 6, which requires the patentee to bring an action respecting the patents that are set out in the NOA within 45 days. The parties and Southcott J all agreed that the matter was appropriate for determination by summary judgment [20], [22].

Southcott J held that there is no limitation period applicable to actions brought under s 8.2 [77]. The first point, and a very powerful one, is that there is nothing in the text of s 8.2 suggesting that there is a limitation period, in contrast to the clear limitation period set out expressly in s 6 [41]–[42]. As the FCA has noted, “the clearer the ‘ordinary meaning’ of the text, the more compelling the contextual considerations must be in order to warrant a different reading of it, especially when that involves adding words to those used by the legislator” Biolyse Pharma 2003 FCA 180 [13].

The role of the text is “dominant” (Canada Trustco 2005 SCC 54 [10]), but not absolute, and accordingly Southcott J went on to consider a variety of purposive and contextual arguments made by the parties. The defendants’ basic argument was that the purpose of the Regulations generally and s 8.2 in particular is to reduce the legal uncertainty associated with generic entry [38], [46]. The plaintiffs’ argued that the purpose of s 8.2 in particular is to remove the previously existing barriers to bringing a quia timet action, but not necessarily to eliminate legal risks prior to generic product launch [46]. (And see [35], explaining the prior hurdles to a quia timet action.)

After canvassing the general principles of statutory interpretation, Southcott J considered the specific arguments made by the parties. The defendants generally relied on the RIAS and a high level assessment of the legislative purpose. The plaintiffs responded directly to this by noting that even if the we were to accept that s 8.2 incorporated a limitation period, the defendants acknowledged this would only apply to an action brought under that provision, ie a statutory quia timet action. A patentee who missed the deadline would still be free to sue on an unlisted patent following market entry, when it is no longer necessary to bring the aciton quia timet. This is in contrast to an action related to the patents that are the subject of an NOA, which, pursuant to s 6.01 cannot normally be the basis for a subsequent action [64]. The defendants did not go so far as to argue that a parallel finality provision should be read in along with the limitation provision. Consequently, it is difficult to conclude that the purpose of the provision is to eliminate the generic’s legal risk [69]. If anything, incorporating a limitation period in s 8.2 without the accompanying principle of finality would increase risk and expense, as the patentee would simply wait until launch to bring its action.

The plaintiffs also relied on several arguments turning on the way s 8.2 and a putative limitation period would interact with the Regulations as a whole. For example, the plaintiffs noted that the NOA provides the first person with sufficient information to be able to decide whether to bring an action quickly enough to meet the 45 day deadline, but the “as the NOA is not directed to unlisted patents, the first person would not be similarly equipped to commence a s 8.2 action within the same 45 days” [66]. The patentee made several other arguments of a similar nature, which Southcott J generally accepted. It would take me as much time to summarize them as the original decision, so I’ll just say that I found Southcott J’s analysis to be careful and convincing.

The cumulative weight of these contextual and purposive arguments, combined with the clear textual argument, is inescapable. Southcott J therefore concluded that there is no limitation period applicable to the actions brought under s 8.2 [78]. (Perhaps it is more accurate to say that s 8.2 does not incorporate any limitation period, as the actions brought under that provision are no doubt subject to the general limitation periods under the Act.)

Given Southcott J’s careful consideration of the provision, his statement of its purpose will be helpful if it requires interpretation on some other point in the future:

[71] I accept that the legislative purpose of s 8.2 is the removal of previously existing barriers to quia timet actions, so as to facilitate legal consideration of unlisted patents and thereby address uncertainty resulting from the risks associated with such patents. However, this purpose does not require the elimination of such uncertainty within any particular timeframe, as no interpretation of s 8.2 can eliminate the uncertainty that the potential for post-launch litigation of unlisted patents will continue to present. Rather, the elimination of the common law barrier achieved by s 8.2 permits earlier access to legal consideration, and therefore earlier resolution, of unlisted patent infringement claims. This result is in keeping with the overall objective of striking a balance between effective patent enforcement and timely generic market entry.

Caution in Following UK Caselaw Regarding Added Matter

Western Oilfield Equipment Rentals Ltd v M-I LLC 2021 FCA 24 Locke JA: Gleason, Mactavish JJA affg 2019 FC 1606 O'Reilly J

            2,664,173 / Shaker and Degasser Combination

Previous posts have provided some background on this case and addressed reasonable compensation, the Gillette defence and the “best mode” requirement. This post turns to Locke JA’s comments regarding added matter.

Section 38.2(2) of the Act provides that an application cannot be amended to add matter “that cannot reasonably be inferred” from the specification as it was on its filing date. This provision broadly corresponds to Art 123(2) of the EPC, which provides that the application or patent may not be amended to add matter “which extends beyond the content of the application as filed.” As previously noted, the claims that were infringed had been introduced during prosecution, after the patentee became aware of the appellants’ product. The appellants argued that these claims were invalid for added matter [138]. There is little Canadian caselaw dealing with our provision, and the appellants had therefore relied on UK caselaw as support for a “strict” test that “subject matter should be considered to have been added unless such matter is clearly and unambiguously disclosed in the original application either explicitly or implicitly” [140]. (See here for my discussion of O’Reilly J’s decision on this point.)

Locke JA remarked that we should be “wary” of following the UK approach, for three reasons. First, “it presumes that matter has been improperly added, and places the burden on the respondent to establish otherwise,” whereas in Canadian law a patent is presumed to be valid (s 43(2)) and accordingly the burden is on the party attacking the patent. Second, the text of the provision is different, and in particular the EPC provision* does not have any kind of “reasonableness” language: [142]. Third, the UK provision provides explicitly for patent revocation, while s 38.2 does not [143]. Accordingly, Locke JA simply applied the statutory “cannot reasonably be inferred” test and held that the feature in question was “at least reasonably inferable” from the original specification [147].

I agree with Locke JA we should not adopt the UK approach uncritically, for all the reasons he gives. On the other hand, comparative law can potentially be very useful, particularly when, as in this case, there little Canadian caselaw and a great deal of UK caselaw; the foreign caselaw can help illustrate the kinds of problems that may arise and that need to be taken into consideration, even if we do not adopt the same solutions as foreign law. For example, the problem of “intermediate generalization” arises when the specification provides a number of specific examples and the patentee seeks to claim a broader class which is said to be exemplified by those examples. This has caused considerable difficulty and has been addressed in a number of EPO Board decisions and UK cases: see eg Nokia v IPCom [2013] RPC 5 [56]ff. While the problem does not arise in this case, the European jurisprudence is likely to be useful in illuminating the issues when it does arise, even if the Canadian courts choose not to adopt the European solution.

In my view, Phelan J struck exactly the right note in Amazon.com 2010 FC 1011 [32] when he observed that it can be useful to look to other regimes when faced with a question that is novel in Canadian law, but this must be done “mindfully” [32].

A “mindful” consideration of foreign law means that we should not simply pluck a test from foreign jurisprudence. It is important to get the foreign law right before we decide whether to adapt it to the Canadian context. In the UK approach, added matter is permisible if it can be “implicitly” inferred from the original specification, and this may soften the apparently strict nature of the test. So, another articulation provided by Jacob LJ in Vector Corp [2007] EWCA Civ 805 [4] is that:

[T]he test of added matter is whether a skilled man would, upon looking at the amended specification, learn anything about the invention which he could not learn from the unamended specification.

Given that a skilled person approaches the specification with “a mind willing to understand,” it may be that the test is not so strict after all. On the one hand this suggests that UK law may provide some helpful guidance despite the differences in the text; but on the other hand, the need to understand the subtleties of foreign law is another reason to be “wary” of it.

Another point is that it may be helpful to look to the purposive considerations adverted to in foreign law. To the extent the purpose of the Canadian and UK provisions are different, that is additional reason to be wary of the same test, but to the extent the purpose is the same, that is a reason to consider the foreign test more closely, always subject to the text of the provision.

This is perhaps most relevant to Locke JA’s third point, that the UK Act provides explicitly for patent revocation while s 38.2 does not [143]. This raises the question of whether added matter contrary to s 38.2 is a basis for invalidating a claim in a granted patent, or whether it is only ground for refusing an amendment during prosecution. Some of the purposive considerations discussed by Jacob LJ in Vector Corp are potentially relevant to this issue:

[5] The reason for the rule was explained by the Enlarged Board of Appeal of the EPO in G1/93 ADVANCED SEMICONDUCTOR PRODUCTS/Limiting feature [1995] EPOR 97 at [Reasons 9]:

"With regard to Article 123(2) EPC, the underlying idea is clearly that an applicant shall not be allowed to improve his position by adding subject-matter not disclosed in the application as filed, which would give him an unwarranted advantage and could be damaging to the legal security of third parties relying upon the content of the original application."

[6] Mr Richard Arnold QC provided a clear articulation as to how the legal security of third parties would be affected if this were not the rule:

The applicant or patentee could gain an unwarranted advantage in two ways if subject-matter could be added: first, he could circumvent the "first-to-file" rule, namely that the first person to apply to patent an invention is entitled to the resulting patent; and secondly, he could gain a different monopoly to that which the originally filed subject-matter justified.

These considerations seems to me to also be relevant in the interpretation of the Canadian provision, always subject to the text.

*Note that the UK courts rely directly on Art 123(2) rather than on the somewhat differently worded s 76(3) of the Patent Act 1977, which was a “cack-handed” implementation of the EPC provision: Napp Pharma [2009] EWCA Civ 252 [69].

Is the Best Mode Requirement Restricted to Machines?

Western Oilfield Equipment Rentals Ltd v M-I LLC 2021 FCA 24 Locke JA: Gleason, Mactavish JJA affg 2019 FC 1606 O'Reilly J

            2,664,173 / Shaker and Degasser Combination

Previous posts have provided some background on this case and addressed reasonable compensation and the Gillette defence. Locke JA also made two noteworthy points with respect to the best-mode requirement set out in s 27(3)(c), which requires that the specification must “in the case of a machine,” explain the best mode of practising the invention. As discussed here, O’Reilly J had dismissed this argument on the basis that it “relates solely to machines and, as I understand the patent, it claims a method and a system, not a machine” [FC 146], [118]. Locke JA remarked that the mere fact that the claim at issue was phrased as being to “a system” did not in itself establish that it is not to a machine [119]. This makes sense to me; the question of whether the claim is to a machine should be a matter of the substance of the claim and not its form.

More importantly, Locke JA stated that “there is considerable doubt as to whether, despite the wording of paragraph 27(3)(c), the best-mode requirement is limited to machines,” citing various commentators [119]. This is interesting given that the FCA in Pfizer v. Novopharm / sildenafil (NOC) 2010 FCA 242 [72] approved Snider J’s holding in Ramipril FC 2009 FC 676 [329] that “the ‘best mode’ obligation only arises in the case of a patent to a machine.” I must say that Snider J’s textual analysis strikes me as fairly compelling, but far be it for me to dissuade the FCA from relying on commentators. Locke JA’s observation was expressly obiter, and the point made no difference to the outcome, but nonetheless the point can no longer be considered settled.

The Gillette Defence Is Typically Unhelpful

Western Oilfield Equipment Rentals Ltd v M-I LLC 2021 FCA 24 Locke JA: Gleason, Mactavish JJA affg 2019 FC 1606 O'Reilly J

            2,664,173 / Shaker and Degasser Combination

Friday’s post provided some background on this case and addressed the issue of reasonable compensation. Today’s post reviews Locke JA’s very helpful discussion of the Gillette defence. (The discussion did not turn on the way the issue arose on the facts and the issue did not affect the result.)

Locke JA began by reiterating the classic understanding of the Gillette defence, which permits a defence based on establishing that its allegedly infringing product is the same as, or not patentably distinct from, the prior art; if that can be established on the facts, the asserted claims must necessarily be invalid or not infringed: [75]–[76] citing Gillette (1913) 30 RPC 465 (HL) and JK Smit [1940] SCR 279. While this is not new law, it is important nonetheless, as Locke JA emphasized that “contrary to some of the jurisprudence of the Federal Court, the success of a Gillette defence does not depend on a conclusion that the claim in question is invalid for anticipation or obviousness. Quite the contrary, the principal benefit of a Gillette defence is to avoid the need to construe the claims and reach a conclusion on validity and infringement issues.” [79]. Locke JA noted that the FCA itself in Eurocopter had skirted with a similar misunderstanding [80]

The theory of the Gillette defence is that it permits “a shortcut around the often difficult and time-consuming process of construing the claims of a patent, and then determining whether those claims are valid and whether they have been infringed” [77]. Unfortunately, in practice the Gillette defence has often complicated rather than simplified the proceedings. The defendant will rarely risk everything on the Gillette defence, but will typically assert it as an alternative to the analysis of claim construction and validity [78]–[79]. This means that even when the Gillette defence is raised, the court will normally have to construe the claims and assess validity and infringement, in order to address the other anticipation and infringement arguments. In that case, the Gillette defence is superfluous; rather than simplifying proceedings, by obviating the need to consider infringement and validity, it complicates matters by introducing an extra and unnecessary argument, which may lead to confusion [79].

The general message is that when claim construction, validity and infringement are fully argued, it is probably preferable to avoid the Gillette defence entirely.

Questions on Reasonable Compensation Answered — and Left Open

Western Oilfield Equipment Rentals Ltd v M-I LLC 2021 FCA 24 Locke JA: Gleason, Mactavish JJA affg 2019 FC 1606 O'Reilly J

            2,664,173 / Shaker and Degasser Combination

In this decision Locke JA for the FCA affirmed O'Reilly J’s holding that certain claims of M-I’s 173 were valid and had been infringed by Western Oilfield Eqpt. The decision turned largely on the deferential standard of review applicable to questions of fact, and Locke JA pointedly remarked that the appellants had not paid sufficient attention to the standard of review [10]. The appellants raised approximately two dozen issues on appeal [7]. Locke JA was not impressed. He remarked on “the lack of wisdom of raising so many issues on appeal,” noting that this undermined the appellant’s case by obscuring the real issues and wasted the Court’s time [9]. As a result of the appellants’ “failure to reasonably limit the issues before the Court, and the respondent’s success on each argument raised,” costs were awarded at the top of Column V of the Tariff [162].

Despite the largely factual nature of the issues, the FCA did address a number of legal points. I’ll provide background and address reasonable compensation in this post, and subsequent posts will look at the Gillette defence, best mode and added matter. In addition, Locke JA reaffirmed the well-established law that the four-step Sanofi test for obviousness is not mandatory [109] and the fact that the embodiment disclosed in the specification is not commercializable does not mean that it lacks the necessary scintilla of utility needed to support a patent [124].

Background

As discussed here, the 173 patent relates to a machine called a “shale shaker,” used in the oil and gas industry to remove solids from the slurry that emerges from an active well in order to separate the drilling fluid for reuse. A shale shaker shakes the slurry over a screen to allow the fluid to fall through while the rock cuttings are carried away. Shaking alone does not remove all of the fluid, and the cuttings remain wet after passing through a standard shaker. The invention consisted of a method and system for applying a vacuum (“pressure differential generator”) to the cuttings to recover more of the drilling fluid. One point that underlay several of the appellants’ objection was that the patent was laid open on April 10, 2008, and the appellants’ activities did not infringe the claims as they were drafted at that time. The claims that were infringed were introduced during prosecution, on October 2, 2013, after the patentee became aware of the appellants’ product [53], [FC 14], [FC 89].

There were a number of contentious issues on claim construction, but these turned on the evidence and, unsurprisingly—given that the claims were added to capture the appellants’ product—O'Reilly J ultimately construed the claims in favour of the patentee. The finding on infringement followed directly. The appellant raised the motivation of the patentee in amending the claims in a couple of ways [22], [144], but Locke JA noted that the respondent’s motivation in amending the claims is in itself irrelevant to either claim construction or validity [22]. As he observed at [21], quoting his own prior decision in Camso 2019 FC 255 [197] aff’d 2020 FCA 183:

A patent applicant is perfectly entitled, and indeed is well-advised, to draft patent claims with an eye on competitors’ products. The limitation is that the applicant must respect all of the requirements for valid claims.

Reasonable Compensation

The decision raised three issues in the interpretation of s 55(2), which provides that the patentee is entitled to “reasonable compensation” for any damage sustained by the patentee after the specification was laid open and before the grant, “that would have constituted an infringement of the patent if the patent had been granted on the day the specification became open to public inspection.” For simplicity, Locke JA referred to this as “pre-issuance infringement” [52].

There were two main issues on appeal. One of the appellants, FPM, had apparently stopped doing business in 2014, prior to the issuance of the 173 patent in 2015. The first question was whether a party who engages in pre-issuance infringement “can avoid liability under subsection 55(2) by discontinuing the activities in question prior to issuance of the patent.” That is, must a party be engaged in infringing activity as of the date of issuance in order to be liable for pre-issuance infringement? The answer is no. There is nothing in the text of the provision to suggest that result [59]. Further, the purpose of s 55(2) is “to compensate inventors whose published inventions are used without permission before they can enforce their rights,” [63] and “it would defeat the purpose of the provision if the pre-issuance infringer could continue its activities, possibly for many years, and then avoid all liability by discontinuing those activities just before the patent issues” [63].

The second question was whether a party can be liable for inducement of pre-issuance infringement. The answer is yes. Inducement is “merely a form of patent infringement, not a distinct tort” [60]; there is nothing in the text to suggest liability for inducement is excluded [62]; and it would “defeat the purpose of the provision if one could avoid liability by inducing another to directly infringe. The reasons for imposing liability for infringement on one who knowingly induces a third party to infringe after a patent has issued apply equally before issuance” [63].

Neither of these issues strikes me as particularly difficult, and I agree entirely with Locke JA’s analysis.

The more difficult issue, to my mind, concerns the timing of the liability. As noted above, the appellants’ activities did not infringe the claims as they were drafted at the time the patent was laid open. The claims that were infringed were introduced five years later during prosecution, after the patentee became aware of the appellants’ product [53], [FC 240]. It was common ground on appeal, and, as I understand it, also at trial, that the appellants’ could not be liable for any of its activities prior to 2 October 2013, when the infringed claims were introduced [53]. O'Reilly J held that reasonable compensation should be awarded for the period starting 2 October 2013, and this was affirmed on appeal [66].

The difficulty is that s 55(2) makes a party liable for activity “that would have constituted an infringement of the patent if the patent had been granted on the day the specification became open to public inspection.” It was common ground that the appellants’ activities would not have constituted an infringement of the claims as of the date the patent was laid open, and it would seem to follow on a straightforward reading of the text that the appellants are therefore not liable for reasonable compensation for any part of the period prior to issuance—not even for the period after 2 October 2015 when the claims were amended to catch the appellants' product. The rule applied in this case is that a party will be liable for activities that would have constituted an infringement if the patent had been granted at any time subsequent to the date the patent was laid open, which does not seem to me to be entirely consistent with the text. That is not conclusive, of course; as discussed here, there might be contextual or purposive considerations that are also relevant one way or the other.

This point does not seem to have been argued either at trial or on appeal, and it would appear to remain open. Locke JA noted that FPM stopped doing business in 2014 which was after the claims had been amended to encompass its activities. He stated that this means that FPM could not avoid liability based on its activities being entirely prior to the amendment, “even if that were a basis for avoiding liability. I express no opinion here as to whether that would be a basis for avoiding liability” [56]. I take this to mean that the timing issue remains open. Locke JA did also state that the facts are not in dispute, “and there is no argument that either of the appellants is liable for any of its activities prior to October 2, 2013" [53]. I take this to mean simply that there was no argument, and not that Locke JA was necessarily endorsing this position as a matter of law.

Skepticism Regarding I G Farbenindustrie Test for Selection Patents

Bristol-Myers Squibb Canada Co v Pharmascience Inc 2021 FC 1 Zinn J

2,461,202 / 2,791,171 / apixaban / ELIQUIS

This decision consolidated four actions concerning the 202 patent, which claims the compound apixaban and its use in treating thromboembolic disorder, including stroke [2], [27], and the 171 patent, which claims various formulations of apixaban[2], [114]. The decision raises several legal issues, though largely as a result of some “creative” submissions by the defendants [125]. The most important point is that Zinn J expressed considerable skepticism regarding the continued vitality of the I G Farbenindustrie test for selection patents. Zinn J addressed the 202 patent first and then the 171 patent. I won’t cover every issue, but only those that caught my eye.

Date for assessing sufficiency

The first attack on the 202 patent was based on insufficiency. There was some discussion of whether the date for assessing sufficiency is the date of filing or the date of publication [36]–[42]. I’ll note that there has indeed been some debate in the case law on this issue, but the point was settled in Idenix v Gilead 2017 FCA 161 [46], holding that the correct date is the filing date, in a case that was crucial to the result. (I’d suggest that while Idenix ruled out the publication date, there remains an open question as to whether it should be the claim or the filing date, as that distinction was not at issue in Idenix—I’d argue that it should be the claim date, but that’s for another day.) Idenix was not cited by Zinn J, presumably because it was not cited to him, and consequently he appears to have considered the publication date to be the relevant date [49].

In any event, so far as I can tell, nothing turned on this point. As both filed and published the application claimed 10¹⁰⁰ compounds, and it was only just before issuance that the claims were narrowed to one compound, namely apixaban [37]. The defendants apparently argued the patent was insufficient because it did not enable all 10¹⁰⁰ compounds to be made [37]. That is, sufficiency had to be assessed in terms of the document as it existed at the relevant date (whatever that date might be). That is certainly a very creative argument, but. . . no, “The test for sufficiency is whether [the skilled person] is in a position to work the invention. The invention is that claimed in the patent, and until it is issued, there is no patent” [49]. That must be right — if it weren’t almost every granted patent would be invalid, because claims are routinely amended during prosecution in response to objections by the examiner, which necessarily takes place after filing. If anticipation, utility and obviousness all had to be assessed as of the claim date or filing date, then amendments to the claims could never cure any objection.

Studies demonstrating utility need not be referenced in the patent

The defendants also argued that the patent was invalid for lack of utility because the study demonstrating utility must be referenced in the patent. Zinn J rejected this proposition, relying primarily on statements by the SCC in Sildenafil 2012 SCC 60 [39]–[40] and AstraZeneca 2017 SCC 36 [58]. I’ll add that Gleason J (as she then was) reviewed the authorities in Lilly v Apotex 2015 FC 1016 [138]–[141]. She pointed out that the FCA authorities supporting such a requirement were obiter, and there are many cases to the contrary, and she therefore concluding that “the weight of authority is to the effect that the evidence of demonstrated utility need not be referenced in the patent for the patentee to rely on it” [142]. I think this point can now be considered settled, though it would certainly be desirable to have it addressed by the FCA to remove any lingering doubt.

A genus too large to think about does not anticipate

The most interesting issue was an anticipation attack based on 2,349,330, which disclosed and claimed a large class of compounds that were potentially useful in the treatment and prevention of thromboembolic disorders [79]. The class is very large. One of the experts for Sandoz did a calculation of the number of compounds disclosed and came up with “Some number that is just larger than I can think about.” He agreed that it was “more possibilities than stars in the universe” [80]. On the evidence provided by Sandoz’s experts, the class encompassed apixaban [77], but did not specifically disclose it, or describe how to make it [82]. On this evidence, Zinn J had no difficulty in concluding that the 330 patent did not anticipate apixaban [83].

Nor was apixaban obvious over the 330 patent, as only a small percentage of the disclosed compounds would actually be effective in treating thromboembolic disorders, and identifying which would involve “complex, time-consuming, unpredictable research” [87]. Obviousness-type double patenting failed for the same reason: [96]–[97].

IG Farbenindustrie test doubted

Apixaban is therefore a classic selection over the 330 patent. Significantly, it was only after finding that apixaban was neither anticipated nor obvious over the 330 patent that Zinn J turned to question of selection patents as such and the three-part test set out in IG Farbenindustrie (1930), 47 RPC 289 (Ch) 322-23, that was approved in Sanofi 2008 SCC 61 [9]-[11]. The factors, in summary, are: (1) a valid selection must possess some substantive advantage over the genus; (2) all of the selected members must possess the advantage; (3) the advantage must be peculiar to the selected group. Zinn J held that these three propositions are “not a stand-alone basis to find a selection patent invalid,” relying on the express holding to that effect in Olanzapine 2010 FCA 197 [33] where the FCA stated that an assessment of whether the IG Farbenindustrie conditions has been met “does not constitute an independent basis upon which to attack the validity of a patent” [104]. Despite this holding by the FCA, the IG Farbenindustrie conditions continue to resurface as an independent ground of attack, most recently in Lilly v Mylan 2020 FC 816, discussed here.

Zinn J’s contribution to this debate was to go back and quote from the explanation for these factors given by Maugham J in IG Farbenindustrie itself [100]. In the passage quoted by Zinn J, Maugham J specifically connected the first and second factors to standard grounds of attack, namely utility and insufficiency. The explanation given by Maugham J for the third factor is somewhat more obscure, and also more controversial, as it was specifically criticized in Dr Reddy’s [2009] EWCA Civ 1362 [39]. I suspect that the third factor was an imperfect attempt to avoid the problem of arbitrary selection, which is properly treated as an aspect of non-obviousness. I might also add that I am not at all convinced that the first and second factors are properly related to utility, as Maugham J indicated. But the important point here is that Maugham J did explain the factors he set out in terms of the traditional grounds of invalidity. As I read it, Maugham J considered these factors to be a helpful way of stating the standard principles in the context of a selection patent, and not as an entirely new ground of attack. I agree therefore, with Zinn J’s observation that for Maugham J, and for Rothstein J in Sanofi referencing Maugham J’s analysis, “a failure to meet his three propositions regarding selection patents does not invalidate the patent; rather its validity is subject to the usual grounds relevant to any patent” [101]. I am very pleased to note that Zinn J also cited my blog post, Time to Relegate IG Farbenindustrie to the Dustbin of History, in which I pointed out that the SCC in Sanofi did not apply the IG Farbenindustrie as an independent ground of invalidity on the facts, but rather relied on the standard grounds of anticipation and obviousness, as Zinn J did in this case. That is why it is significant that Zinn J addressed anticipation and obviousness before turning to the IG Farbenindustrie factors; having decided that the 202 patent was valid on the standard principles, there was no more role for the IG Farbenindustrie factors to play. Out of an abundance of caution, Zinn J nonetheless went on to hold that in any event, the 202 patent met the IG Farbenindustrie test [106]–[108].