Strategies to keep in mind as the death knell sounds for Australia’s second-tier Patent system

Dr Jim Onishi MRACI

Key Points:
1) Australia is abolishing its second-tier Innovation Patent system.
2) The last date to file an Innovation Patent is 25 August 2021.
3) It is still possible for patentees to obtain “new” Innovation Patents
after 26 August 2021.

Brief Background

Two tiers of Patent protection are currently available to Applicants in Australia, a Standard Patent and an Innovation Patent. The Innovation Patent is considered to be a second-tier Patent, because of the lower “innovative step” threshold for determining non-obviousness. Otherwise, all other patentability criteria remain the same for both Standard Patents and Innovation Patents. The main drawbacks for Innovation Patents include the limitation of having a maximum of five claims, and a reduced Patent term of eight years. On the plus side, the ability to obtain the grant of a Patent without undergoing substantive examination and the lower renewal fees, are both attractive.

The Australian Government identified that Innovation Patents were largely exploited by “big business” to create Patent thickets, which suffocate small and medium enterprise’s (SME’s) freedom to operate and compete against them. It also identified that the lower standards for Innovation Patents inhibit innovation and competition. In light of this backdrop, the Government drafted legislation to abolish the Innovation Patent entitled: The Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019. The Bill was introduced and passed the Australian Parliament. It received Royal Assent on 26 February 2020 to become the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Act 2020. The death date of the Innovation Patent is 26 August 2021. This means that the last date to file an Innovation Patent Application is 25 August 2021.

Imminent Deadline?

With only around 3 months now remaining until the demise of the Innovation Patent system, there has been a large volume of Innovation Patents being filed at IP Australia, resulting in Patentees experiencing delays in obtaining grant of their Innovation Patents.

Is the Innovation Patent truly dead?

Strategies

Whilst Innovation Patents cannot be filed after 26 August 2021, it is still possible for patentees to obtain “new” Innovation Patents on or after this date.

Strategies for pending cases include:

  • Converting an existing Standard Patent Application into an Innovation Patent;
  • Filing a Divisional Innovation Patent from an existing Standard Patent Application; and
  • Filing a Standard Divisional Patent Application from an existing Standard Patent Application, with a view to later converting it into an Innovation Patent.

A strategy for any new cases includes:

  • Filing Non-Provisional/Complete Patent Applications in Australia no later than 25 August 2021.

For any new cases, Patentees may wish to consider filing their first Non-Provisional/Complete Patent Applications in Australia no later than 25 August 2021. This would provide Patentees with the option of obtaining Innovation Patents in Australia, whilst delaying publication of the Application for 18 months. The delayed publication may be commercially advantageous should it be desirable to keep the contents of the Patent Application a “secret” from competitors and other third parties. Also, any Non-Provisional/Complete Patent Applications filed in Australia could act as a pseudo “Provisional” and could be the basis for obtaining Patents in other jurisdictions. Patentees would be able to file an International PCT Application and/or Standard Convention Applications in the jurisdictions of interest, based on the Australian filing at any time within 12 months of the filing date.

Final Words

The key to ensuring that Innovation Patents are still available to patentees is to have a Complete Patent Application with a filing date earlier than 26 August 2021. It may therefore be worthwhile bringing forward any originating PCT or Standard Patent Applications coming due, so that a filing date no later than 25 August 2021 is obtained. Naturally, bringing forward the filing date would shift the 20-year monopoly period earlier and due consideration should be given to determining whether obtaining an earlier filing date would have any adverse impact on commercial objectives.

The Innovation Patent lives on like a phoenix rising from the ashes. Should you have any questions regarding the filing of Innovation Patents, please contact us at mail@houlihan2.com.

The Multifaceted Question of the Patentability of Polymorphs

Dr Carolyn Rolls MRACI and Dr Jim Onishi MRACI

In the high stakes world of pharmaceutical development, companies pursue every opportunity to edge out competitors. Patenting polymorphs may provide that edge. Noticing a surprising, unexpected or unique physico-chemical characteristic of a crystalline form of a pharmaceutical may be the key.
A new pharmaceutical typically takes 10 to 15 years to progress from initial discovery, through to clinical trials and then to regulatory approval prior to market release. Less than 12% of new pharmaceuticals make it to market release, and the entire process may cost hundreds of millions of dollars.
The right to a temporary market monopoly under a Patent enables innovator companies to raise prices above production costs, recoup pharmaceutical R&D expenses and mitigate risk to investors. Otherwise, the unfettered competition would drive prices down to production costs and recouping costs would be impossible.

Polymorphs

Polymorphism refers to the ability of crystalline material to exist in more than one solid or crystalline form. It is believed that 50 to 80% of all pharmaceuticals exist in at least two polymorphic forms.
Most pharmaceuticals are used in a crystalline form. Polymorphic forms can potentially be characterized by techniques, such as powder X-ray diffraction (PXRD), vibrational spectroscopy, including IR and Raman spectroscopy, and solid-state nuclear magnetic resonance spectroscopy (ssNMR).

To compensate for the drawbacks associated with one technique, multiple characterisation techniques are often used for polymorphic methods. PXRD is most useful for identifying polymorphic forms based on differences in unit cell dimensions, but it requires known or constant crystallinity for analysis. The application of pressure during sample preparation may induce solid-state phase changes when using IR. ssNMR suffers from insensitivity to particle size, but it is sensitive towards minor conformational changes and provides extensive structural information in relation to the specific polymorph being studied. Vibrational spectroscopic methods are useful for obtaining information at the molecular level. Near-infrared spectroscopy (NIR) is fast, non-destructive and requires minimal sample preparation. However, NIR signals appear as abundant broad overlapping bands, which require the utilization of chemometrics to extract useful information. Raman spectroscopy requires particle size and surface homogeneity control for obtaining accurate results and if visible lasers are used, fluorescence effects can pose a problem in colourless powders.

Pharmaceutical regulators, such as the United States FDA and the European Medicines Agency, require screening of polymorphs during new pharmaceutical development to uncover polymorphic forms and evidence as to whether the choice of polymorph will affect the pharmaceutical efficacy or safety. This is because pharmaceutical polymorphs often differ in their physicochemical properties, such as solubility, dissolution rate, density, stability, hygroscopicity, wettability, hardness, optical and electrical properties. These differences can lead to different pharmaceutical properties that affect bioavailabilty, efficacy, metabolism and side effects. Formulation technology for the dosage form may have to be adapted accordingly.

The consequence of having different polymorphic properties was first noted in 1998 for Abbott Laboratories’ antiretroviral HIV drug, Ritonavir (Norvir™). The presence of multiple polymorphic forms in the Norvir™ product was not detected until changes in ambient temperature suddenly caused polymorphic transformation that reduced solubility and bioavailability of the drug. The drug was suddenly withdrawn from the market, which was a serious step for patients and for Abbott, until the source of the problem and a solution for it were found.

Patents

Patenting the structure of a new drug will ensure broad protection for that chemical entity, but will not necessarily ensure an adequate monopoly if any follow-on innovations are patented by others. Different polymorphs can require different methods of formulation or different dosage forms, each of which may be patentable, and a different scope of protection may be available.
Two key requirements for patentability are that an invention must be novel and must involve an inventive step. That is, it cannot be obvious to the ordinary, uninventive person skilled in the art.

In Europe

The question of inventive step in Europe depends upon whether a Patent identifies a technical problem to be solved and whether that problem is routinely associated with polymorphs. Consider, for example, Esai R&D’s Patent for Lenvatinib mesylate.

The problem to be solved was defined as lying in the provision of Lenvatinib in a form having an improved dissolution rate and bioavailability, low hygroscopicity and good stability. These properties are sometimes inversely related and, in this case, did not correlate with each other in the usual way. The skilled person, starting from Lenvatinib, would be aware of its physicochemical properties, and specifically that it is a weak base, by virtue of the presence of the quinoline moiety, with poor aqueous solubility. Moreover, the skilled person would be familiar with the standard literature. However, it was determined that the specific polymorphs of the mesylate salt claimed would not have been expected to deliver the desired combination of properties. Moreover, the skilled person would not have had a reasonable expectation that any arbitrary crystalline salt form of Lenvatinib would be equally suitable. Importantly, appropriate supporting data was provided in the Patent Specification. Accordingly, the Patent was found to possess an inventive step.

In the United States

Recently, the US Federal Circuit Court considered Grünenthal’s polymorph Patent for Tapentadol hydrochloride (Nucynta™ ER) for treating severe pain. Polymorph Form A was held to be non-obvious and patentable in the light of an earlier Patent relating to polymorph Form B.

Importantly, there was no reasonable expectation of successfully producing Form A. The Court held that the ordinary, uninventive skilled person would have thought that synthesis of a stable Form A was unpredictable and was not a matter of mere routine experimentation.

In China

But in an interesting contrast in China, Grünenthal’s Patent for Tapentadol hydrochloride was held invalid, the case turning on the issue of insufficient data appearing in the Patent Specification.
The Court opined that if a new crystalline form achieves unexpected technical effects compared with existing forms, it can be considered inventive. However, Grünenthal had insufficient data to support the assertion that one polymorph was more stable than the other. The Patent Claims relating to the method of crystallization were also held to lack inventive step. It appears that the Patent included general teaching of common crystallization methods, as opposed to those that would lead to the new crystalline form having improved stability. The Patent Specification clearly would have benefited from the provision of data around the difficulties of arriving at the correct solvent system to crystallise a new polymorph having critical properties.

In Australia

The relevant question regarding obviousness in Australia is:

Would the notional research group at the relevant date in all the circumstances … directly be led as a matter of course to try the [invention] in the expectation that it might well produce a useful [product/process]?

This question was applied by the Federal Court when considering a Patent for the antipsychotic drug, Aripiprazole.

A patented polymorph of Aripiprazole solved the problem of hygroscopicity associated with a prior crystalline form. Before the Patent was filed, a synthetic method was known that may have serendipitously led to formation of the polymorph, but synthesis of conventional anhydrous Aripiprazole of high hygroscopicity was also possible. Applying the above question, the Court held that a person skilled in the art would not necessarily be led directly as a matter of course to take the steps outlined in the prior art in the expectation that they would produce the polymorph.

Accordingly, the polymorph invention was held to be non-obvious and therefore to possess an inventive step.

Conclusion

Patent protection is possible if the polymorph exhibits a surprising, unexpected or unique characteristic compared to what is already known. Importantly, there must be sufficient data included in the Patent Specification to illustrate the surprising characteristic and to clearly distinguish the polymorph from known polymorphs. If appropriate supporting test data can be collected, it is worthwhile giving consideration to speaking to a Patent Attorney.

Patenting Opportunities in the Fragrance Industry

Dr Jim Onishi and Dr Elizabeth Houlihan

This article first appeared in the May/June 2020 edition of Chemistry in Australia, published by the Royal Australian Chemical Institute Inc.

It is well known that the fragrance industry is big business. Annual sales from each of the four main global fragrance producers are in the billions of dollars. The intellectual property invested in commercial fragrances is extensively protected.

How does the fragrance industry protect its intellectual property?

Traditionally, industry secrecy was the main form of protecting proprietary information. The proprietary information included, for example, key fragrance compounds (known as ‘captives’), formulations, essential oil extraction processes, and analytical techniques. Use of trade secrets is still an adequate form of intellectual property protection in the fragrance industry, provided that the ‘secret’ proprietary information can be identified, and suitable safeguards are put in place to block secrets from getting out to competitors. The reality is that misappropriation of proprietary information is a real threat because frequent job and career changes within a person’s life is now the norm. Once proprietary information is exposed, establishing misappropriation can be a challenge, if action against the perpetrator is to be pursued. Worse still, after court proceedings are instituted, the difficulty lies in revealing the proprietary information itself, to the public, during the proceedings. Trade secrets alone can no longer constitute an adequate form of protection.

Patents are an alternative form of intellectual property protection, which are available to protect proprietary information. Patents grant the patent owner an exclusionary right for a general term of up to 20 years from the date of filing. A key advantage of patents is that they are enforceable, without identifying the specific proprietary information being misappropriated by a former employee (or his/her employer), provided that the infringement falls within the scope of the patent claims. Patents can therefore be a useful tool to protect proprietary information.

Patents can be obtained for any man-made innovations. It should be noted that in some countries, such as the US, naturally occurring compounds cannot be patented. Fortunately, at least in Australia, isolated forms of the naturally occurring compounds can be patented, as long as they are not perceived as constituting ‘information’, such as genetic information that is incorporated into the isolated nucleic acid sequence. Patents can also be obtained for novel and inventive synthetic pathways for making natural products, as well as for any non-naturally occurring derivative compounds of natural products. Formulations comprising at least one novel and inventive component in the formulation would also be patentable. If the components are known, the formulation may nevertheless be patentable if the components interact in a manner in which they provide a new and non-obvious characteristic or property.

Perfume formulations

Perfume formulations are fascinating in that they allow the re-creation of fragrances found in natural environments. They also allow the creation of new pleasant fragrances not found in nature. Identification of captives isolated from nature and investigating their properties, including any of their synthetic derivatives, may yield the discovery of new pleasant fragrances, unique characteristics or new applications in perfume formulations. High rewards are therefore possible in this billion-dollar industry.

Modern perfumes comprise three parts: a top note, a heart note and a base note. The top note is the first impression of the scent. Due to the high volatility of these small and lightweight captives, they provide the immediate smell upon application to skin. The top note usually mimics leafy green and fruity fragrances. The heart note is the main scent and comprises heavier and less volatile captives. The heart note usually mimics flower fragrances, such as jasmine, lily, cherry blossom and the like. The base note is the last scent to emerge and involves the heaviest captives. These are the least volatile and remain on the skin the longest. The base note usually mimics vanilla, musk, precious woods and the like. Beyond these ‘notes’, the formulations would include surfactants to make the captives water-soluble and to reduce their surface tension, making the various components miscible in the formulation. Additives in the form of colourants, stabilisers (such as chelating agents and UV absorbers) and antioxidants are often included. The main component of all perfume formulation is the solvent medium, usually distilled water and ethanol, which assists with dispersing the fragrance over the skin.

Naturally occurring compounds

Naturally occurring compounds in perfume may include jasmone from jasmine flowers, civetone from civet cats and/or muscone from musk deer. Natural muscone is no longer used because it is isolated from the glands of musk deer, which is an endangered species. The synthetic alternative, l-muscone, can be used, but is expensive. Fortunately, only a small amount of synthetic muscone gives a musk effect, comparable to that of the natural product.

perfumes1

Jasmone can be extracted from a natural source or synthesised. Interestingly, synthetic jasmone has a stronger odour than its natural counterpart. This means that the synthetic version can be used sparingly, thereby reducing manufacturing costs, therefore making the resulting perfume more ecologically friendly.

For woody fragrances, natural sources of sandalwood oil may be used. These can be derived from East Indian sandalwood, West Indian sandalwood, African sandalwood or West Australian sandalwood. Of these, the East Indian sandalwood is most prized, because of its high α-santalol and β-santalol content and composition consistency. However, due to extensive deforestation and environmental concerns, Indian sandalwood is now declared an endangered species.

perfumes2

While modern perfumes use a combination of natural and synthetic ingredients, where the natural ingredients are often cultivated in developing countries, one problem with natural ingredients is in maintaining consistency of the quality of the ingredient, which may vary as a result of annual variations in climate-cultivating conditions.

In the search for innovative nature-inspired synthetic derivatives, researchers have identified that moving the location of substituents or bonds within the captive can have a drastic effect on smell. For example, α-terpene has a lemon-like odour whereas terpinolene, its isomer, has a woody-pine odour. Menthol is another useful component in fragrances. The natural product is primarily one stereoisomer, shown here.

perfumes3

Chiral-catalysed hydrogenation reactions have been used for the chiral synthesis of menthol and other fragrance compounds. The use of these reactions has shown that chiral compounds have different fragrances.

The identification of the signature fragrance molecule associated with a target smell of interest can be done relatively easily using current chemical analytical technologies and chemical synthetic techniques. The conventional technique in the industry involves using headspace analysis to sample volatile chemicals, followed by isolating and identifying each molecule through GC-MS. This technique has made reverse engineering of fragrances faster, cheaper and simpler.

What opportunities might be available?

As noted, there is a need for new smells and smell-alike compounds in the fragrance industry. This, in part, would support the conservation of endangered species and minimise environmental impact of natural habitats of wildlife. We would like to encourage researchers to re-visit their laboratory notebooks and identify whether any compounds made in the course of their past research projects possess a scent. If the scent is woody or flowery, that compound may be a stepping stone to the discovery of a potentially useful new captive. Perhaps the newly identified captive has a more potent aroma, or can be synthesised cheaply? If the newly identified captive is safer and less allergenic than the natural product, then it would be even more valuable.

Patents could be pursued for protecting these newly identified captives, for their synthesis pathway (i.e. methods of making the captives), and perfume formulations involving the new captives. Ideally, patents should be pursued on all these forms to plant a thicket of patents to be used as obstacles to deter competitors. However, in reality, pursuing all these forms individually in a patent can become very expensive. The best pathway forward would depend on the goal to be achieved. For example, if you are a scientist employed by a research institute or a university, a patent owner may monetise its patent by selling it, or licensing it to interested parties and then collecting royalties from them. Patents are therefore valuable commodities.

Do you have something worth patenting?

It may be prudent to consult with a patent attorney before you file that old lab notebook away, just in case you have inadvertently synthesised something worth patenting. Perhaps a short remark made about a woody smell scribbled on a corner of your notebook page, previously overlooked, may lead to a future, valuable practical use in the fragrance industry.

Update on Requesting an Extension of Term of an Australian Patents

Dr Jim Onishi and Michael Houlihan

The normal twenty (20) year exclusive monopoly of a Pharmaceutical Patent may be extended by up to five (5) years under Section 70 of the Patents Act 1990.

Such Extensions of Term are intended to compensate a Patent owner for regulatory delays in the marketing of new pharmaceutical products. Extending the Term of a Patent can be of significant commercial value to a Patent Owner.

However, certain requirements must be met for an Extension of Term Request to be successfully granted and to remain valid.

In this article, we set out the requirements for obtaining an Extension of Term, and the strict deadlines relating thereto.

Requirements for an Extension of Term Request

Under Section 70 of the Patents Act 1990, a Patent Owner must meet the following requirements upon submission of the Extension of Term Request:

1. the claimed invention must be directed to one or more pharmaceutical substances per se, or one or more pharmaceutical substances when produced by a process that involves the use of recombinant DNA technology (Section 70(2));
2. goods containing, or consisting of at least one of those pharmaceutical substances must be included in the Australian Register of Therapeutic Goods (ARTG) (Section 70(3)(a));
3. the period from the date of the Patent to the date of the first regulatory approval for at least one of those pharmaceutical substances must be at least five (5) years (Section 70(3)(b)); and
4. the term of the Patent has not previously been extended (Section 70(4)).

We address each of these requirements separately below:

1. The claimed invention must be directed to one or more pharmaceutical substances per se

An Extension of Term can only apply to a claim directed to the “pharmaceutical substance” itself.

A “pharmaceutical substance” has been defined under Schedule 1 of the Patents Act as:
A substance (including a mixture or compound of substances) for therapeutic use whose application (or one of whose applications) involves:
(a) a chemical interaction, or physico-chemical interaction, with a human physiological system; or
(b) action on an infectious agent, or on a toxin or other poison, in a human body:
but does not include a substance that is solely for use in in vitro diagnosis or in vitro testing.

The term “therapeutic use” as it appears in the above definition is in turn defined as:
for the purpose of:
(a) preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury in person; or
(b) influencing, inhibiting or modifying a physiological process in person; or
(c) testing the susceptibility of persons to a disease or ailment.

Further, the pharmaceutical substance must be for therapeutic use in a human body.

Accordingly, the patent term for medical devices and new treatment methodologies cannot be extended.

2. Included in the Australian Register of Therapeutic Goods (ARTG)

In order to qualify for a Patent Term Extension, goods containing or consisting of the pharmaceutical substance of interest must be included in the ARTG. The phrase “containing or consisting of” has been confirmed by the Australian Federal Court to include any impurity present in a registered goods (Merck & Co Inc v Arrow Pharmaceuticals Ltd [2003] FCA 1344; Alphapharm Pty Ltd v H Lundbeck A/S [2008] FCA 559). This includes any impurity from manufacturing processes, decomposition products, and isomers present in the registered goods. It is also irrelevant that the specific pharmaceutical substance of interest had not been listed in the Register, or that only a minute amount of the pharmaceutical substance of interest, is present in the goods.

It is noteworthy that being “included in the Australian Register of Therapeutic Goods (ARTG)” for the purposes of section 70(3)(a) of the Patents Act 1990 is fulfilled by simply being on the Register for any reason, including export listing (Pfizer Corp v Commissioner of Patents (No 2) [2006] FCA 1176).

The stringent interpretation in Australia for determining the date of first regulatory approval means that an Application for an Extension of Term may be invalid if it is based on an incorrect first regulatory approval date due to earlier registered goods containing the pharmaceutical substance in question. For example, the pharmaceutical substance may have been in fact been included in earlier registered goods as an impurity.

3. The period from the date of the Patent to the date of the first regulatory approval for at least one of those pharmaceutical substances must be at least five (5) years

The filing date of the Patent and the date of first regulatory approval must be no less than five (5) years apart.

4. The term of the Patent has not previously been extended (Section 70(4))

Any request for an Extension of Term for a Patent that has already previously been extended will be refused by the Australian Patent Office.

How the Extension of Term is calculated

Section 77(1) of the Patents Act 1990 provides that the Term of Extension is calculated as the period from the date of the Patent (i.e. the filing date) to the date of first regulatory approval, reduced by five years. Section 77(2) of the Patents Act 1990 stipulates that the Term of the Extension cannot be longer than five years (i.e. a maximum of 25 years of patent protection is potentially available).

The deadline for filing a Request for an Extension of Term

Section 71(2) regulates the deadline for filing a Request for an Extension of Term. Under this provision, an Application for an Extension of Term must be made during the term of the Patent and within six (6) months of the latest of:

(i) the date of patent grant;
(ii) the date of commencement of the first inclusion of the product in the ART; or
(iii) the date of commencement of the Extension provision (i.e. 27 January 1999).

For practical purposes, only (i) and (ii) are now relevant.

It is important to note that the general Extension of Time provisions under Section 223 of the Patents Act 1990 (error/omission or circumstances beyond the control of the applicant or its agent) cannot be used to gain extra time in which to file an Application for an Extension of Term (Boehringer Ingelheim International GmbH [1999] APO 60). Also, an Application for an Extension of Term must be filed prior to expiry of the Patent(Alphapharm Pty Ltd v H. Lundbeck A/S [2011] APO 36).

Patentee Rights during the Extension of Term

If the Application for an Extension of Term is granted, then the exclusive rights of the Patentee during the extended period are limited to the pharmaceutical substance. However, Sections 78(a) and 78(b) of the Patents Act 1990 provide that it is not an infringement to exploit the pharmaceutical substance for a purpose other than for a (human) therapeutic use, and any form of the invention other than for the pharmaceutical substance. Therefore, it is not an infringement to exploit a non-therapeutic use, or any form of the invention that is not a pharmaceutical substance, during the Extended Patent Term.

Extensions of Term for Patents involving recombinant DNA technology

The Australian Patent Office has strictly limited the Extension of Term provisions for pharmaceutical substances to those that include products involving single pharmaceutical actives.

This was not always the case. In the past, owners of Patents claiming substances involving the use of recombinant DNA technology received more liberal consideration. In those cases, the Extension of Term provisions have been considered to be satisfied even when the claimed pharmaceutical substance is defined by reference to method or process steps (ImmunoGeb, Inc. [2014] APO 88). This position has recently been overturned and is no longer followed.

If you would like more information or are considering filing an Extension of Term for an Australian Patent, please do not hesitate to contact us. It is essential that the deadline for filing an Application for an Extension of Term is not missed, since it is not possible to extend this deadline under Section 223 (iCeutica Pty Ltd [2018] APO 77).

Extending the Term of an Australian Patent: Product-by-Process Claims versus Swiss-Style Claims

Dr Jim Onishi and Dr Paul Warden-Hutton

In recent years, the Australian Courts have provided guidance on the kinds of Patent Claims that can form the basis of an Extension of Term Request under section 70(2)(b) of the Patents Act 1990. An extension of the term of pharmaceutical patents can be of significant value to patent owners in providing up to an additional five years of patent monopoly in Australia.

Only Product Claims can form the basis of Extension of Term Requests. The full Federal Court has held that Method or Process Claims do not satisfy the requirements of Section 70(2)(b) because they are not directed to a “pharmaceutical substance per se”. For a more detailed discussion on the requirements for an Extension of Term Request, please refer to our article, “Swiss-Type Claims Cannot be Basis for a Patent Term Extension in Australia”.

Claims to a method of treatment are patentable in Australia. Method of Treatment Claims specify a step (or a set of steps) directed to either therapy or surgery. Such Claims are directed to the cure, alleviation, the removal or the lessening of the symptoms of, or to the prevention or reduction of the possibility of contracting any disorder, or to the malfunction of the human or animal body. An example of a Method of Treatment Claim is as follows:

Swiss-Style Claims are not directed to a “pharmaceutical substance per se

In Commissioner of Patents v AbbVie Biotechnology Ltd [2017] FCAFC 129, the Full Federal Court considered whether Swiss-style Claims could form the basis of Extension of Term Requests for three patents claiming products produced using recombinant DNA technology.

Use of a compound of formula Y for the manufacture of a medicament for treating disease X.

The matter concerned the therapeutic agent adalimumab, sold under the Humira® Trade Mark. The relevant patent Claims were directed to a known antibody used in the manufacture of medicaments for treating ulcerative colitis, Crohn’s disease and rheumatoid spondylitis, respectively.

The matter was referred to the Full Federal Court on appeal, to consider the question of whether an Extension of Term Request is applicable to Swiss-style Claims.

It was held that that Swiss-style Claims were not directed to one or more pharmaceutical substances per se, as required by Section 70(2)(a) of the Patents Act 1990. Rather, Swiss-style Claims are directed to uses for making a medicament for a specific therapeutic purpose. Thus, the Full Federal Court confirmed the position in Australia that Method or Process Claims cannot form the basis of an Extension of Term Request.

Could Product-by-Process Claims be a Useful Alternative?

Australian Courts have not yet had an opportunity of considering whether Product-by-process Claims could be used to extend the term of a patent.

Product-by-process Claims typically recite the process for fabricating a product and are usually in the form of “product A produced by process B” or “product A obtained by process B”. The patentability of such Claims can be limited in certain jurisdictions. For instance, the European Patent Office (EPO) has indicated that a product of a process Claim is admissible only if the product is otherwise patentable and it cannot be defined satisfactorily by reference to its composition, structure or some other testable parameter (Case Law No: T 0956/04, decision date: 17 January 2008. The Boards of Appeal of European Patent Office. 2008).

Patent owners do not usually regard Product-by-process Claims as being of primary importance. Such Claims can be difficult to enforce against infringers who produce products by different processes. Furthermore, Product-by-process Claims can be difficult to prosecute, because the novel features usually reside in the process and not in the product. In Australia, unlike some other jurisdictions, the process steps are considered limiting. In fact, the Australian Patent Manual of Practice & Procedure presents a dichotomy, in that while the National section refers to such Claims as being directed to the product only when obtained or produced by the process (Section 2.11.2.3.11 of the Australian Patent Manual of Practice & Procedure),  in contrast, the International section refers to such Claims as being directed to the product per se and “is not rendered novel merely by the fact that it is produced by means of a new process” (Section 1.1.11.3 of the Australian Patent Manual of Practice & Procedure).

Product-by-process Claims are considered by many to cause difficulties in their prosecution and enforcement. However, such Claims may still be useful to support an Extension of Term Request of a pharmaceutical Patent in Australia. A Product-by-process Claim may be considered to meet the Section 70(2)(a) requirement for an Extension of Term Request. In other words, a Product-by-process Claim may be interpreted as being “directed to one or more pharmaceutical substances per se, or one or more pharmaceutical substances when produced by a process that involves the use of recombinant DNA technology”.

The above may apply in circumstances where the relevant product is a new and inventive pharmaceutical substance that can only be defined by reference to the process by which it was made (e.g. compound X obtainable by process Y), because the chemical structure or composition is undetermined. Such circumstances may arise in respect of higher technological inventions, produced using recombinant methods. The increasing complexity of biological components and the recombinant methods used to generate them could mean that the resultant products cannot be fully defined by reference to their one-dimensional nucleic acid or amino acid sequence. Furthermore, the three-dimensional structure of such products may remain undetermined. In such cases, a Claim defining the substance by reference to such method steps would be considered to be a Claim to the substance per se (Zentaris AG [2002] APO 41; Pharmacia Italia SpA v Mayne Pharma Pty Ltd [2006] FCA 305).

Conclusion

Owners of pharmaceutical patents who are considering extending their patent monopoly in Australia could possibly look to utilise Product-by-process Claims as a basis for an Extension of Term Request. While such Claims are considered difficult to prosecute and/or enforce, their value could instead lie in potentially forming the basis of an Extension of the Term of a Patent in Australia.

Australian Courts have not yet had opportunity to specifically consider Product-by-process Claims that are drafted in the form of “product A produced by process B” or “product A obtained by process B”. Until then, Patent Applicants for pharmaceutical inventions may wish to consider including Product-by-process Claims during prosecution, even if such Claims are of limited scope. This may be particularly advantageous in circumstances where such Claims define the product by reference to the process by which it is made, because the chemical structure or composition may still be undetermined.

We recommend the inclusion of Product-by-process Claims during prosecution of your Australian Patent Application. If you require assistance in drafting such Claims, or if you wish to file a Request an Extension of Term of an Australian Patent, please do not hesitate to contact us.

Method and Swiss-type Claims in Australia – A Patent Protection Strategy for Pharmaceutical Companies

Dr Jim Y Onishi

Novel compounds and any relevant medical uses of those compounds are protectable in Australia in the form of Compound Claims and Method of Treatment Claims, respectively. Subsequently identified new medical uses of a known compound may only be protectable in the form of second medical Use Claims, which are also known as “Swiss-type” Claims.

This article proposes a strategy, which is as yet untested, for pharmaceutical companies to include both Method of Treatment Claims and Use Claims in Australia, to achieve maximum patent protection.

Claims to a method of treatment are patentable in Australia. Method of Treatment Claims specify a step (or a set of steps) directed to either therapy or surgery. Such Claims are directed to the cure, alleviation, the removal or the lessening of the symptoms of, or to the prevention or reduction of the possibility of contracting any disorder, or to the malfunction of the human or animal body. An example of a Method of Treatment Claim is as follows:

A method of treating [disease X], the method comprising the step of administering to a patient a medicament comprising a compound of formula Y or a pharmaceutically acceptable salt thereof.

Method of Treatment Claims would be infringed by medical practitioners exercising their professional skills to treat their patients, which is the primary reason for many jurisdictions banning such claims. Pharmaceutical companies who supply the medicament to medical practitioners would also infringe such Claims through contributory infringement.

Swiss-type “Use” Claims are also patentable in Australia. Swiss-type Claims are directed to the use of a compound for preparing a medicament for treating certain diseases. An example of a Swiss-type Claim is as follows:

Use of a compound of formula Y for the manufacture of a medicament for treating disease X.

Swiss-type Claims are typically used to protect second or subsequent medical uses and are infringed by a third party, which manufactures a medicament containing the compound for use in the claimed medical indications. There is no restriction requiring that Swiss-type Claims be limited to second or subsequent medical uses of a compound and such Claims can be used even when the first medical use of the compound is not previously known.

Recently, Swiss-type Claims have been accepted in Australia as purpose-limited process claims, rather than product claims, in light of confirmation by the Full Federal Court of Australia in the Judgment in The Commissioner of Patents v AbbVie Biotechnology Ltd [2017] FCAFC 129.

Why was this Judgement important for Australian Pharmaceutical Patents?

Definition of “exploit
For a granted patent claim to be infringed in Australia, exploitation must have occurred.

The definition of “exploit” under the Patents Act 1990 is:

(a) where the invention is a product—make, hire, sell or otherwise dispose of the product, offer to make, sell, hire or otherwise dispose of it, use or import it, or keep it for the purpose of doing any of those things; or

(b) where the invention is a method or process—use the method or process or do any act mentioned in paragraph (a) in respect of a product resulting from such use.

In the previous Judgment of Alphapharm Pty Ltd v H Lundbeck A/S [2008] FCA 559, the expression “from such use” at the end of paragraph (b) was construed to mean “the use, anywhere, of the method or process” (emphasis added). This construction was not challenged in the Appeal in H Lundbeck A/S v Alphapharm Pty Ltd [2009] FCAFC 70, and later confirmed in a separate Judgement in Warner-Lambert Company LLC v Apotex Pty Limited (No. 2) [2018] FCAFC 26. Therefore, a claimed method performed outside of Australia was found to fall within the definition of “exploit”. This means that in Australia, Method and Use Claims are further reaching than Product Claims. Product Claims are “exploited” when the claimed invention occurs in Australia. In contrast, Method and Use Claims are “exploited” when the claimed invention occurs in any country in light of the definition of paragraph (b).

Infringement of Swiss-type Claims
As a result of the interpretation of “exploit” under the Patents Act 1990, Swiss-type Use Claims would be infringed by the importation of, or an offer to import, a medicament manufactured overseas for use in the claimed medical indications. However, in the recent Judgment of Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2019] FCA 28, it was determined that Swiss-type Claims can only be infringed if there was an intention for the medicament to be used for the claimed medical indications. In that case, Mylan was unable to demonstrate intention by Sun Pharma despite showing evidence of bioequivalence, as well as the similarities in the product information (PI) document (the generic product was silent on the claimed medical indications). The Court in that Judgment ruled that the Swiss-type Claims were not infringed. Mylan, however, successfully demonstrated that a significant portion of the generic products would be used by medical practitioners in a manner that would infringe its Method of Treatment Claims, and accordingly, was able to rely on the contributory infringement provisions of the Patents Act 1990.

Modified Swiss-type Claims
In our opinion, the question of “intent” in relation to first medical uses could be circumvented by drafting a modified Swiss-type Claim specifying a “mode of action”, rather than specifying any diseases to be treated. For example, if the claimed compounds have been identified as inhibitors or activators of a certain enzyme, then the modified Swiss-type Claim could refer to use as a medicament for treating conditions associated with abnormal activity levels of that enzyme. Generics wishing to introduce their pharmaceutical products could provide a PI document listing all known relevant therapeutic indications, which indications would inherently occur by the claimed “mode of action”

Pharmaceutical Patenting Strategy
It would be our recommendation for Patents in the pharmaceutical fields to preferably contain both Method of Treatment Claims and “Swiss-type” Use Claims. In situations where novel pharmaceutical compounds are identified, we suggest that a modified form of Swiss-type Claim for the first medical use specifying a “mode of action” be incorporated.

Patentees should be adequately protected from any infringing activities by third parties in Australia, as well as such activities being conducted outside of Australia, by incorporating these Claim categories into Australian Pharmaceutical Patents.

If you have any questions concerning your Pharmaceutical Patents, please do not hesitate to contact Houlihan².

Patent Office Confirms Stricter Specification Requirements Under Australia’s “Raising the Bar” Patents Act

Dr Jim Y Onishi

Greed is Good” is a famous quote made by Gordon Gekko, a fictional character in the 1987 hit film “Wall Street”. Whilst Mr. Gekko had a great run during the film, his greed was the catalyst of his downfall.

Similarly, in Cytec Industries Inc. v Nalco Company [2019] APO 2, the Applicant has been taught a lesson that greed is not good when it comes to broad claims – more than is justified by the Applicant’s disclosure of the invention.

What was the case about?

The Australian Patent Office had to deal with interpreting the revised specification requirements of subsections 40(2)(a) and 40(3) of Australia’s “Raising the Bar” Patents Act, and whether the specification satisfied those requirements.

Relevant Law

Subsection 40(2) requires that: “A complete specification must: (a) disclose the invention in a manner which is clear enough and complete enough for the invention to be performed by a person skilled in the relevant art.

Subsection 40(3) requires that: “The claim or claims must be clear and succinct and supported by matter disclosed in the specification.

Background

Cytec Industries Inc (“Cytec”) filed an Opposition against the acceptance of Nalco Company’s (“Nalco”) patent application. During the opposition proceedings, Nalco filed amendments to its claims, which were opposed by Cytec and the allowance of those amended claims were heard separately.[1] The main opposition was held in abeyance until a decision issued in respect of the amendments. The main opposition was decided based on the unamended claims.

Construction of Claims

The claims are directed to a method of reducing scale in a Bayer process. Claim 1 recites:

A method for the reduction of aluminosilicate containing scale in a Bayer process comprising the steps of:

adding to the Bayer process stream an aluminosilicate scale inhibiting amount of a composition comprising at least one small molecule, the at least one small molecule comprising [a list of components for a broad class of small molecules defined by a generic “Markush” style – list and structures omitted].

Stated simply, claim 1 is directed to a method where at least one small molecule is used to reduce scale in a Bayer process. The Delegate confirmed that this claim encompassed use of (i) single compounds; and (ii) mixture of compounds.

What did the Specification Disclose?

The specification provided a disclosure of a number of discrete small molecules, which could be used in reducing scale in a Bayer process. Thus, there is literal support for the single molecule in the text of the specification.

Notably, the specification only contained one example teaching a general method of combining three components, designated A, G and E, to form a complex mixture of compounds. Importantly, the specification only ever referred to isolating the “product mixture” and there was no disclosure or worked examples on how each compound of the mixture could be isolated.

Accordingly, the specification only exemplified use of a complex mixture containing many compounds.

The Delegate’s Observations

In determining whether a single compound and a mixture of compounds have been disclosed in a “clear enough and complete enough manner” as required by subsection 40(2)(a), the Delegate applied[2] the following 3-step test[3] and questions[4]:

(1) construe the claims to determine the scope of the invention as claimed;

(2) construe the description to determine what it discloses to the person skilled in the art;

(3) decide whether the specification provides an enabling disclosure of all the things that fall within the scope of the claims;

(4) is it plausible that the invention can be worked across the full scope of the invention? and

(5) can the invention be performed across the full scope of the claims without undue experimentation?

The Delegate was mindful that a person skilled in the art would be familiar with purification and isolation techniques. He considered that on the balance of probabilities, isolation of single compounds was plausible.

In relation to undue experiment, the Delegate recognised that some trial and error is allowable by supplementing the disclosure with the common general knowledge of a person skilled in the art. It was noted by the Delegate that no evidence was submitted in relation to whether a single compound could be isolated from the complex reaction mixture, or the reaction protocol could be tweaked to produce a single compound. With the lack of evidence, the Delegate found that significant work would be required to isolate the single compound from the complex mixture, more so when the process is used in an industrial setting where chromatography techniques are unlikely to be used.

The Delegate therefore considered that the specification enabled the production of a mixture of compound but not to single compounds.

In relation to the support requirement under subsection 40(3), the Delegate applied the following 3-step test:[5]

(1) construe the claims to determine the scope of the invention as claimed;

(2) construe the description to determine the technical contribution to the art; and

(3) decide whether the claims are supported by the technical contribution to the art.

The Delegate identified the technical contribution as being the use of the crude reaction mixture, which when fed to the Bayer process reduces scale formation.

Accordingly, the claims, which encompasses use of single compounds, lacked support.

Take Home Message

“Enablement” under the Raising the Bar provisions replaced “sufficiency” of disclosure under the old Act. The test under the old Act required one to determine whether the disclosure will enable a person skilled in the art to produce something within each claim without new inventions or additions or prolonged study of matters presenting initial difficulty.[6] This meant that something falling within the claim needs to be enabled, rather than the whole scope of the claim. If this case was determined under the old Act, sufficiency of disclosure should be satisfied because the preparation of a complex mixture of compounds (which mixture is something that falls within the scope of the claims) is enabled.

“Support” under the Raising the Bar provisions replaced “fair basis” under the old Act. There are several formulations of the test for fair basis. Two of the accepted tests are to determine: (i) whether the claims travels beyond the matter disclosed in the specification;[7] or (ii) whether there is a real and reasonably clear disclosure.[8] Fair basis was satisfied as long as the disclosure of the invention was consistent with the Claims. If this case was determined under the old Act, fair basis should be satisfied because information concerning single compounds and a complex mixture of compounds are both disclosed.

This decision confirms the stricter specification requirements to obtain a patent in Australia under the “Raising the Bar” Patents Act. Applicants are advised to make sure that the specification discloses enough information to enable a person skilled in the art to practice the full scope of the claimed invention, and furthermore, ensure that the specification adequately exemplifies the technical contribution to the art made by the applicant. The stricter requirements do not mean that everything that could fall within the scope of the claim has to be disclosed in the specification and practically demonstrated to work, but rather, everything that has been explicitly claimed must be practically demonstrated to satisfy enablement and support requirements.

[1] The Decision in Cytec Inductries Inc. v Nalco Company [2018] APO 4 denied the allowance of the amendments.

[2] The Delegate identified that in Encompass Corporation Pty Ltd v InfoTrack Pty Ltd [2018] FCA 421 at [167] the Court stated that s40(2)(a) only related to enablement but did not expand further to formulate an enablement test.

[3] CSR Building Products Limited v United States Gypsum Company [2015] APO 72 at [89].

[4] Evolva SA [2017] APO 57.

[5] CSR Building Products Limited v United States Gypsum Company [2015] APO 72 at [110].

[6] Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty Ltd (2001) 50 IPR 513 at [519].

[7] Olin Corp v Super Cartridge Co Pty Ltd (1977) 180 CLR 236

[8] Rehm Pty Ltd v Websters Security Systems (International) Pty Ltd (1988) 81 ALR 79 at [95].

The Era of Relying on Trade Secrets to Protect Confidential Information has Passed

Dr. Victoria Longshaw

Businesses need to protect their Intellectual Property and Know-How to survive. Such Intellectual Property ranges from confidential customer details to high-level technical expertise, methods and product information.

There are two ways in which to prevent competitors from accessing Intellectual Property: (1) by maintaining Trade Secrets; or (2) by securing a monopoly through obtaining Patents and/or Registered Designs.

A Trade Secret is any confidential business information that provides an enterprise with a competitive edge [1]. When deciding on how to protect their Intellectual Property, many businesses choose to keep Trade Secrets by default. They are perceived as requiring little upfront cost since paid employees are relied upon to keep information confidential. For example, The Coca-Cola Company claims to have kept its formula secret for over 130 years by only letting a small group of senior executives know parts of the formula at any given time.

In contrast, Patents and Registered Designs are often regarded as costly liabilities rather than assets. Media reports of Patent Court battles discourage would-be Patent and/or Registered Design owners from pursuing Rights that they do not intend to enforce.

However, contrary to popular belief, maintaining a Trade Secret can be a complex and costly exercise. Each piece of information needing protection must be identified, labelled, and its storage constantly monitored. Access to that information must be restricted, and adequate security established for both physical and electronic files. Additionally, non-disclosure clauses must be incorporated into all Employment, Contractor, Consultant and Vendor/Supplier Agreements. This incurs costs.

Importantly, Trade Secret protection only lasts for as long as the information is kept confidential. Once it is made public, Trade Secret protection ends. Unfortunately, it is only when a Trade Secret has been disclosed, that many businesses find they cannot prove to a Court, when seeking to recover damages, that sufficient steps were taken to protect the Trade Secret from disclosure.

Even well-resourced multinational corporates are struggling to protect their Confidential Information in the digital age. With the steady increase in digital commerce, cybersecurity threats and data breaches have become commonplace. This is particularly the case in the Asia-Pacific region, which is one of the fastest growing regions for digital innovation and commerce. In the top six ASEAN countries, digital commerce is projected to increase from US$5 billion in 2015 to US$90 billion by 2025 [2]. The average loss caused to a business due to a data breach has now passed the US$1 million mark.

However, despite the exponential increase in malware and Trojan software, the biggest cyber security threat that organisations face today is the human factor: 52% of data leakage in organisations worldwide is caused by employees or ex-employees, either through theft or accidental disclosure [3]. This means that not only must organisations defend their Confidential Intellectual Property from external acquisition by competitors, but they must guard it internally from misappropriation by their own employees, the very personnel that are relied upon to keep Trade Secrets secure.

The easiest way in which a competitor can gain access to a Trade Secret is by poaching employees. Once in possession of secret information, a competitor could file Patent or Design Applications for that information, claiming it as their own. The genuine owner may need to defend themselves against a Cease and Desist Letter, attempting to stop them from using their own technology. It is difficult and expensive to prove that a secret invention was stolen.

At Houlihan², we think outside the square. When cleverly deployed, the role of Patents and Registered Designs expands beyond the traditional concept of obtaining a commercial monopoly for licensing/enforcement purposes. In the digital age, Patents and Registered Designs also serve as pre-emptive disclosures of selected information, as protection against data leakage and theft. Provided that Applications for Patents or Registered Designs are filed for relevant information before any disclosure or data leakage, the subsequent Intellectual Property Rights will hopefully not be affected by Trade Secret theft or data breach.

References
[1] https://www.wipo.int/sme/en/ip_business/trade_secrets/trade_secrets.htm
[2] “The Monetary Authority of Singapore’s 2018 special report on the digital economy”, published in the Straits Times, 7 May 2018
[3] Expert Opinion from Mr Stephan Neumeier, Managing Dir of Kaspersky Lab Asia Pacific: “Exclusive-expert shares insights on the changing cyber security landscape in the Asia-Pacific region”, published on www.opengaveasia.com on 18 July 2018

The Lost Art of Patent Claim Drafting – Why Good Claim Drafting is Essential Under Australia’s Revised Patents Act

Dr. Jim Y. Onishi and Dr. Elizabeth E. Houlihan

We report the recent Patent Office Decision in Cytec Industries Inc. v Nalco Company [2018] APO 4, which dealt with interpreting the “Raising the Bar”-revised requirements of subsection 40(2)(a) of Australia’s Patents Act 1990 in relation to post acceptance claim amendments under subsection 102(2)(b).

Relevant Law

Subsection 102(2) states that:
An amendment of a complete Specification is not allowable after the relevant time if, as a result of the amendment:
(a) a claim of the Specification would not in substance fall within the scope of the claims of the Specification before amendment; or
(b) the Specification would not comply with subsection 40(2) or (3),

where the “relevant time” is after the Specification has been accepted.

Subsection 40(2) of the Patents Act 1990 states that:
A complete Specification must: (a) disclose the invention in a manner which is clear enough and complete enough for the invention to be performed by a person skilled in the relevant art.

This Australian Patent update will focus on the Patent Office’s consideration of whether, as a result of the proposed claim amendments filed by the patent applicant, the complete Specification disclosed the claimed invention clearly and completely enough to satisfy the requirement of subsection 40(2)(a) of the Patents Act 1990. It will also focus on whether a proper understanding of the invention and correct claim drafting could have saved the claim.

Background

Cytec Industries Inc (“Cytec”, the Opponent) filed an Opposition against the acceptance of Nalco Company’s (“Nalco”, the Applicant) patent application, which was directed to reducing scale in a Bayer process. During the opposition proceedings, Nalco filed a request to amend Claim 1 to recite:

A method for the reduction of aluminosilicate containing scale in a Bayer process comprising the steps of:
adding to the Bayer process stream an aluminosilicate scale inhibiting amount of a composition comprising at least one small molecule,
wherein the small molecule is selected from the group consisting of compounds (I) through (XIII), (XV) through (XXX), (XXXII) through (LVIII) and (LX) through (LXVII):
[structures omitted].”

Prior to filing the amendment, Claim 1 recited a method for the reduction of aluminosilicate containing scale in a Bayer process comprising adding to the Bayer process stream an aluminosilicate scale inhibiting amount of a composition comprising at least one small molecule selected from a broad class of small molecules defined in a generic “Markush” format. Since all the small molecules specified in amended Claim 1 fell within the scope of the broad class defined in the accepted claim, subsection 102(2)(a) was satisfied.

Opposition to the Amendment

One of the grounds asserted by Cytec was that the compounds denoted by LXVI and LXVII, which were not specifically claimed previously, are not disclosed in the complete Specification in a clear enough and complete enough manner for the invention to be performed by a person skilled in the relevant art (“PSA”) as required by subsection 40(2)(a) of the Patents Act 1990.

The Delegate’s Observations

Did the Specification disclose the subject matter (i.e., the compounds denoted by LXVI and LXVII) now claimed as a result of the amendments, in a clear enough and complete enough manner to be performed by the person skilled in the art?

In answering this question, the Delegate followed the same process of reasoning applied in UK and EPO decisions for guidance. In so doing, the Delegate had to determine:
(i) the scope of the invention as claimed;
(ii) what the Specification disclosed to the PSA; and
(iii) whether the Specification provided an enabling disclosure of all the things falling within the scope of the claims.

The Delegate construed Claim 1 as being directed to reducing aluminosilicate scale in a Bayer process stream involving the step of adding to the process stream an amount of a composition. The use of the term “comprising” in relation to the step meant that additional steps, not explicitly defined in the claim, could be included within the method. The Delegate also considered that the composition to be added may optionally contain more than one of the components specified in the Claim. Accordingly, the composition to be added could include either of the compounds denoted by LXVI and LXVII, either in the presence or the absence of any other of the small molecules specified in the Claim.

The Delegate determined that the Specification referred to the small molecule as being a reaction product between an amine molecule and an amine-reactive molecule, or a mixture of such reaction products. Thus, it was considered that mixtures of scale inhibiting small molecules were clearly envisaged in the Specification.

The Delegate noted that there were no depictions of structures of compounds LXVI and LXVII; however, he concluded that these compounds were inherently disclosed in the Specification.

Notably, the Specification contained one Example teaching a general method of combining three components, designated A, G and E, to form mixtures of compounds of the invention. Importantly, the Specification only ever referred to isolating the “product mixture” and there was no disclosure or any worked examples demonstrating how each component of the mixture could be isolated.

Evidence submitted by the Opponent, Cytec, suggested that the product mixtures obtained by following the example would in fact be a complex mixture of many compounds, the actual composition of which would vary according to numerous factors. The Delegate considered that it was plausible that the reactions disclosed in the Specification produced mixtures containing compound LXVI or LXVII. However, it was clear that these compounds could only be produced as part of a complex mixture involving at least 15 possible compounds being formed from reagents having several reactive functional moieties.

Accordingly, the Delegate considered that the Specification enabled the production of compound mixtures.

In relation to the question of whether each of these compounds on its own, as claimed, could be produced, the Delegate then considered whether each compound could be produced without undue burden.

The applicant, Nalco, made submissions to the effect that the PSA would not expect chemical additives for use in the Bayer process to be 100% pure compounds and that it was commonplace to use chemical structures to denote industrial grade mixtures of chemical compounds. Therefore, their isolation is not necessary.

Despite what the PSA might expect, the Delegate considered that it is the scope of the claims, as defined by the words used, that must be given due consideration.

The Delegate agreed that the Claims and teaching of the Specification do not require the isolation of compounds LXVI and LXVII, but that this in itself did not help in determining whether as a result of the amendment, a real and reasonable clear disclosure of the invention as claimed had been satisfied. The Delegate recognized that the Claims included the possibility of the compounds in question being in their isolated forms, yet the Specification only disclosed use of a complex mixture containing many compounds.

Since the Specification was silent regarding how a PSA could isolate, identify, or quantify the individual components of the mixture in the presence of the other components in the mixture, the Delegate considered that there was insufficient information in the Specification for PSA to produce the individual compounds absent others and therefore that the PSA would be unable to perform the full scope of the claimed invention without undue burden.

Accordingly, the proposed amendments were rejected.

Take Home Message

For Applicants seeking patent protection of their invention in Australia, this Decision confirms that there is a real need to ensure that the Specification fulfills enablement requirements across the full scope of the claimed invention. As the law currently stands, this does not mean that everything that could fall within the scope of the claim has to be disclosed in the Specification and practically demonstrated to work, but rather, everything that has been explicitly claimed must be practically demonstrated for enablement. This Decision teaches that being silent regarding how a single molecule could be made and yet explicitly claiming “at least one small molecule”, led to the detriment of the amendment request.

The authors take a moment to reflect back to their training years many years ago and wonder whether if the actual inventive concept was identified by first identifying the problem to be solved by the invention, then perhaps this lack of enablement issue would not exist. A possible representative claim could be drafted as follows:

A method of reducing siliceous scale in a Bayer process stream, the method comprising adding an aluminosilicate scale inhibiting amount of a composition comprising N [(hydroxy)alkyloxyalkyl[(trihydroxy)silyl]]-N-alkyldiamine to the process stream.

Such a Claim would avoid the need to explicitly claim both single compounds and mixtures by referring to the common structural features of the relevant compounds used for reducing scale in the Bayer process. It would follow that the question of whether or not production of single compounds has been disclosed would be unlikely to be entertained by the Delegate since that subject matter would not have been explicitly claimed.

The Doom and Gloom lifts: patentability of Gene Marker-Trait Correlation Methods in Australia

Dr. Victoria Longshaw, Dr. Nigel Parker and Dr. Elizabeth Houlihan

The Australian Federal Court has provided welcome reassurance to patent owners in the biotechnology fields of gene association analyses and quantitative genetics.

In the aftermath of D’Arcy v Myriad Genetics Inc [2015] HCA 35 (“the Myriad case”), in which isolated nucleic acids encoding naturally-occurring information were excluded from patentability, there has been uncertainty as to the scope of this exclusion. Is the use of naturally-occurring gene sequences patentable?

The Federal Court has now answered this question: “yes”. In Meat & Livestock Australia Limited v Cargill, Inc [2018] FCA 51, handed down on 9 February 2018, the Court held that methods using gene markers to identify a trait in an animal are patentable in Australia.

A brief history of the case

This case involved an appeal from an IP Australia Opposition Decision by Meat & Livestock Australia Limited and Dairy Australia Limited (the Appellants, collectively referred to as “MLA”). The Appellants are industry research bodies that invest in, and act on behalf of, agricultural industries in Australia.

MLA had unsuccessfully opposed Australian Patent Application No. 2010202253 (“the Patent Application”), filed in the name of Cargill, Inc and Branhaven, LLC (“the Respondents”). The Patent Application is directed to methods for identifying a trait in a bovine subject from a nucleic acid sample of that subject. Specifically, the claimed invention was directed to identifying single nucleotide polymorphisms (“SNPs”) associated with bovine traits of economic importance using a high-density SNP map of the bovine genome.

MLA’s key argument was that the claimed invention was not patentable because it did not comprise a “manner of new manufacture” according to Subsection 18 (1)(a) of the Patents Act 1990 which states:

“an invention is a patentable invention for the purposes of a standard patent if the invention, so far as claimed in any claim is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies.”

This argument relied heavily upon the outcome of D’Arcy v Myriad Genetics Inc [2015] HCA 35 (“the Myriad case”), in which isolated nucleic acids containing the same information as naturally-occurring nucleic acids were considered not patent eligible. The Decision in the Myriad case was handed down after MLA had initiated the Opposition Proceedings against the Patent Application.

MLA argued that the Claims of the Patent Application lacked an inventive step in light of over 130 documents, which were later limited to Venter J C et al. (2001)(1), the seminal publication of the human genome, and a general review paper on the use of SNPs as markers in animal genetics (2).

Accordingly, it was argued, the inventors of the Patent Application had merely used routine methods, in a routine manner, to address a problem that any skilled person, applying experience acquired from human genome analysis, could have solved and, in so doing, had inevitably arrived at the bovine SNPs of the invention. MLA contended that obviousness should be decided on whether or not SNPs, as opposed to other markers, were an obvious choice to use. However, this argument was rejected, the Delegate concluding that it was not obvious to arrive at the specific SNPs claimed in the Patent Application.

The Opposition failed on all grounds except for a minor clarity issue of Claim 13 that could be rectified by amendment. The only ground upon which MLA was successful was a minor clarity issue in Claim 13. That is, the Delegate regarded Claim 13, which is directed to a polynucleotide identified using the method of the invention, as a reach-through Claim that would have lacked patent eligibility if it has been clear.

MLA appealed the Decision to the Federal Court.

The question before the Federal Court

MLA’s principal attack centred on whether or not the Claims of the Patent Application satisfy the “manner of manufacture” requirement for patent eligibility, in light of how the High Court interpreted this requirement in the Myriad Decision.

MLA argued that the Claims are directed to known methods that use naturally-occurring markers for gene sequences (SNPs). Furthermore, such use was not appropriately defined by any sequence, making the Claims so broad in scope that bona fide research in the field would be prevented, contrary to the public interest. All the inventors had done, in MLA’s view, was to discover naturally occurring associations between specified SNPs and bovine traits. Accordingly, in light of the Myriad case, it would be anomalous if a claim to a product was not patentable, but a Claim to the use of that product in a method Claim was patentable, particularly a method using known techniques.

Grounds of inutility, lack of novelty, lack of inventive step, lack of sufficiency, lack of clarity, and lack of fair basis were also raised.

Turning first to the field of the invention, the Court held that the skilled person in the field of the invention was a molecular geneticist with laboratory experience. MLA had not led any expert evidence from such a person. Thus, MLA’s inventive step attack was rejected, with the Court preferring the evidence provided by the expert witnesses for the Respondents.

The Court also distinguished the case from the Myriad Decision because it concerned method Claims rather than product Claims. That is, the reasoning in the Myriad case could not be applied to the method Claims in suit, or the product Claim dependent thereon, because they were not directed purely to genetic information. Rather, the Claims were directed to the practical application of the identification of SNPs in a bovine nucleic acid sample, which is within “the plain vanilla concept of manner of manufacture” (3) as interpreted by the Myriad case.

MLA’s argument that the Patent Application would have a “chilling effect” on research was disposed of by the Court identifying another patent, co-owned by MLA, that was similarly broad, such that MLA’s argument did not sit well with its own patent and the effect thereof. The breadth of the Claims was not considered to be indicative of a lack of patentable subject matter.

After considering the complex subject matter in detail and noting the substantial conflict in expert opinion evidence, the Court rejected MLA’s appeal on all grounds except for minor aspects of clarity and utility regarding Claim 1. These deficiencies could be rectified by amendment to include reference to a statistically significant p value, as suggested by the Court.

The position in Australia and the United States distinguished

Australian and US Courts have taken similar positions by excluding naturally-occurring nucleotide sequences from patentability. However, the positions of Australia and the US on gene marker-trait correlation methods may not be similarly aligned.

Diagnostic methods relying on the application of a law of nature have received considerable attention in the US where they have been held to lack patent eligibility (4). Such methods usually involve screening for the presence or absence of a disease, or a predisposition to develop a disease.

Australian Courts have not yet had the opportunity of reaching a similar conclusion. The present case is the first time that Australian Courts have had an opportunity to consider the patentability of methods employing naturally occurring compounds since the Myriad case which suggested that such methods may be patentable. Arguably, the claimed invention is not a diagnostic method because it does not involve the diagnosis of a disease using biological markers, but rather the correlation of a pre-existing or potential phenotypic trait with a biological marker. Nonetheless, to the extent that aspects of such correlation methods overlap with diagnostic methods, it appears that they are patentable in Australia but not in the US.

Take-home message

This case provides reassurance for biotechnology innovators in the field of gene marker-trait association analyses, when prosecuting and enforcing their Australian Patent Portfolio.

The Federal Court has now confirmed that methods of using gene sequences are not encompassed by the isolated nucleic acid exclusion defined by the Myriad case. These inventions are patent eligible subject matter in Australia.

Nonetheless, when pursuing patent protection for methods of gene association analysis in Australia, Applicants should pay particular attention to aspects of clarity and utility. For example, method Claims for gene marker-trait associations should define the word “associated” in terms of statistical significance (e.g. a p value of equal to or less than 0.01).

This case also provides an important reminder to select expert witnesses carefully when leading evidence in any Australian Patent Proceedings. Evidence from experts with practical experience in the specific field of the invention will be preferred by an Australian Court over a theoretical understanding of the invention provided by an advanced academic.

  1. Venter, J. Craig, et al. “The sequence of the human genome.” Science 291.5507 (2001): 1304-1351.
  2. Vignal, A., Milan, D., SanCristobal, M., & Eggen, A. (2002). A review on SNP and other types of molecular markers and their use in animal genetics. Genetics Selection Evolution, 34(3), 275.
  3. Meat & Livestock Australia Limited v Cargill, Inc [2018] FCA 51, 134 [428].
  4. Mayo Collaborative Services v.  Prometheus Laboratories, Inc. 132 S. Ct. 1289 (2012)