leflunomide

Sanofi v Apotex – infringement

The previous post looked at the High Court’s ruling that Sanofi’s patent for a method of medical treatment was patentable subject matter as a manner of manufacture. This post looks at the infringement ruling.

You will recall that the patent for leflunomide itself has expired, but claim 1 of Sanofi’s relevant patent is for:

[a] method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis, which comprises administering to a recipient an effective amount of [leflunomide].

Dermatologists do not prescribe leflunomide for the treatment of psoriasis, but rheumatologists do prescribe leflunomide for the treatment of rheumatoid arthritis (RA) and psoriatic arthritis (PsA). Apparently, almost every person who has PsA will have, or will also develop, psoriasis. When leflunomide is prescribed for the treatment of PsA, “it is usually expected to also prevent or treat the patient’s psoriasis, if that person has a concurrent case of psoriasis.”[1]

Apotex had received marketing approval from the TGA for the treatment of RA and PsA (but not psoriasis specifically). Its product information stated:

“INDICATIONS

Apo-Leflunomide is indicated for the treatment of:

. Active Rheumatoid Arthritis.

. Active Psoriatic Arthritis. Apo-Leflunomide is not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease.”

The Federal Court – Jagot J at first instance and the Full Court had agreed with Sanofi that Apotex’ supply of leflunomide in these circumstances infringed s 117. While the reasoning was a bit different in each case, it essentially turned on 2 propositions:

First, s 117(2)(b): Apotex had reason to believe its leflunomide would be used to treat psoriasis because its administration to PsA sufferers would usually involve treatment of psoriasis too.

Secondly, s 117(2)(c): in any event, Apotex’ product information was an instruction to use leflunomide in the treatment of psoriasis when it was being prescribed to treat PsA.

Crennan and Kiefel JJ (with whom French CJ and Gaegeler J agreed) rejected both bases and held that Apotex did not infringe.

The patent gave Sanofi a very limited monopoly – use of leflunomide for a particular purpose. This appears to have led to an important point of policy at [302]:

…. It is difficult to understand how the supply of an unpatented product, the use of which by a supplier would not infringe a method patent, can give rise to indirect infringement of a method patent by a recipient of the unpatented product from the supplier. The difficulty reflects the prior art and Sanofi’s limited novelty in the hitherto unknown therapeutic use of the pharmaceutical substance, which is the claimed subject matter of the Patent.

Notwithstanding the interpretation of the product information reached by all four Federal Court judges below, there was no instruction or recommendation of the kind required by s 117(2)(c). Bearing in mind the regulatory regime imposed by the TGA at [303]:

…. In light of the provisions of the TGA, to which reference has been made, the expression “indication” in the product information document is an emphatic instruction to recipients of Apo?Leflunomide from Apotex to restrict use of the product to uses other than use in accordance with the patented method in claim 1. ….

It was simply an instruction to use leflunomide for the treatment of PsA or RA. Nor was s 117(2)(b) engaged. Rather than looking to the effect of the administration of Apotex’ leflunomide, it was necessary to look at the purpose it was being prescribed for: in the relevant cases, the treatment of PsA. At [304] therefore:

it was not shown, nor could it be inferred, that Apotex had reason to believe that the unpatented pharmaceutical substance, which it proposes to supply, would be used by recipients in accordance with the patented method, contrary to the indications in Apotex’s approved product information document.

This suggests that it will be very difficult to establish infringement of a claim to the use of a medicine for a patented purpose where the therapeutic compound itself is no longer patented and the the patented purpose is not one of the indications for which the supplier has obtained TGA approval. One might wonder about the situation where the supplier / respondent was aware of significant off-label use. In this case, however, the High Court seems to have characterised the infringing effect as purely incidental. That was no doubt supported by the different specialists who might prescribe leflunomide for the different purposes.

The High Court did not find it necessary to discuss the trial judge’s finding [2] that leflunomide was not a staple commercial product so that s 117(2)(b).

So, after all that, Apotex did not infringe the patent. We at least have a clear ruling (albeit obiter dicta in that special High Court way) about the patentability of methods of medical treatment so far as the courts (and the current High Court) are concerned. I wonder how much the pecuniary remedies for Apotex’ infringement of copyright in the product informtion is worth?

Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd [2013] HCA 50


  1. Crennan and Kiefel JJ at [182].  ?
  2. Sanofi v Apotex (No 2) at [270] – [273], on the footing that the relevant product for the purposes of s 117(2)(b) was the product as supplied by Apotex (and not leflunomide generally), which could be supplied and traded only for the 2 limited purposes indicated in the product information.  ?

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Apotex v Sanofi: manner of manufacture

As briefly noted last week, the High Court handed down its ruling in Apotex’ appeal. Although the case will be mainly remembered because Apotex lost its challenge to the patentability of Sanofi’s method of medical treatment, Apotex actually won on the patent infringement point. (As there was no appeal on that point, however, it was still liable for infringing the copyright in Sanofi’s product information.)

Claim 1 of Sanofi’s relevant patent is for:

[a] method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis, which comprises administering to a recipient an effective amount of [leflunomide].

The patent for leflunomide itself has expired.

Apotex had received marketing approval from the TGA for the treatment of rheumatoid arthritis (RA) and psoriatic arthritis (PsA).

By a majority of 4 – 1,[1] the High Court held that:

  1. a a method of medical treatment is indeed patentable subject matter – a manner of manufacture[2] – under Australian law;
  2. a second or subsequent use of a known substance could also be patentable subject matter; but
  3. Apotex did not infringe by selling or supplying its generic leflunomide according to its product information.

manner of manufacture

All 5 judges accepted the orthodoxy of the NRDC decision as defining the approach to whether a claim was to a manner of manufacture. And all 5 judges accepted it was a broad and widening concept.

Crennan and Kiefel JJ identified NRDC as essentially requiring 2 conditions to be satisfied. For example, at [235], their Honours quoted the Wellcome case:

This principle [in the NRDC Case] extends to a process which does not produce a new substance but results in ‘a new and useful effect’. If the new result is ‘an artificially created state of affairs’ providing economic utility, it may be considered a ‘manner of new manufacture’ within s 6 of the Statute of Monopolies. (Crennan and Kiefel JJ’s emphasis)

At [278] – [285], their Honours identified 7 reasons why a method of medical treatment could be patentable. Gaegler J agreed with these 7 reasons and proposed an eighth.[3] Given the broad scope of the concept, Crennan, Kiefel and Gaegler JJ considered the crucial consideration was that there was no economic or ethical basis for distinguishing between the patentability of a pharmaceutical (or other medical) product and a method.[4] French CJ’s reasoning was similar to this point; considering the historical exclusion from patentability to be an anomaly for which no clear and consistent foundation had been established.[5]

In contrast, Hayne J in dissent considered at [143] – [150] that it could well be possible to distinguish between patenting medical products and methods of treatment. Instead, his Honour considered that a process would only be patentable if the product (in the sense of the result, outcome or effect) of the process, and not just the process itself, had economic utility. Hayne J considered that a method of medical treatment did not satisfy that criterion because (at [163]):

The effect of using the process is personal to the individual. It is not an effect which the person who owns the right to use the process, or any person other than the individual who has been treated, can turn to economic account in any way, whether directly or indirectly. If the individual who has been treated can turn the effect to economic account, he or she can do so only indirectly: by taking advantage of better health to make a more valuable contribution to national production. The individual is not a subject of commerce. The product of the process in the individual (having better health than might otherwise have been the case) cannot be sold. ….

Perhaps reflecting Hayne J’s approach to some extent, Crennan and Kiefel JJ at [287] did consider that there was a distinction to be drawn between uses of therapeutic substances and the activities and procedures of doctors when treating patients on the basis that the latter are “non-economic”:

There is, however, a distinction which can be acknowledged between a method of medical treatment which involves a hitherto unknown therapeutic use of a pharmaceutical (having prior therapeutic uses) and the activities or procedures of doctors (and other medical staff) when physically treating patients. Although it is unnecessary to decide the point, or to seek to characterise such activities or procedures exhaustively, speaking generally they are, in the language of the NRDC Case, “essentially non?economic” and, in the language of the EPC and the Patents Act 1977 (UK), they are not “susceptible” or “capable” of industrial application. To the extent that such activities or procedures involve “a method or a process”, they are unlikely to be able to satisfy the NRDC Case test for the patentability of processes because they are not capable of being practically applied in commerce or industry, a necessary prerequisite of a “manner of manufacture”.[6]

French CJ, however, at [1] and [44] expressly included surgical procedures in his Honour’s finding in favour of patentability.

second use of a known substance

As Crrennan and Kiefel JJ pointed out, NRDC itself involved a second or subsequent use of a known substance, the hitherto unsuspected properties of which squarely satisfied the requirements for inventiveness. Apotex’ reliance on this basis, therefore, failed at [291] in succinct terms.

the infringement question

… will have to wait for another day.

Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd [2013] HCA 50


  1. French CJ, Crennan, Kiefel and Gaegler JJ; Hayne J dissenting.  ?
  2. Patents Act 1990 s 18(1)(a). The claim would, of course, also have to satisfy the other requirements including novelty, inventive step, utility etc.  ?
  3. Gaegler J appears to be alone in attributing weight to the potential disruption to business investments if the endorsement by Bristol-Myers v Squibb of the patentability of methods of medical treatment was overturned after 13 years.  ?
  4. See [282] for Crennan and Kiefel JJ; [314] for Gaegler J.  ?
  5. At [50]. See also [44] – [49].  ?
  6. Earlier, at [266] – [271], their Honours had noticed that Congress amended the US Patents Act to include §287(c)  ?

    “the effect of which is to permit the patenting of surgical methods to continue but to bar actions for patent infringement against medical practitioners (and ”related health care entit[ies]“) for ”the performance of a medical or surgical procedure on a body“.”

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Apotex v Sanofi

The Full Court (Keane CJ, Bennett and Yates JJ) has unanimously dismissed Apotex’ appeal from Jagot J findings that it had infringed Sanofi-Aventis’ patents and copyright. Bennett and Yates JJ delivered a joint opinion, Keane CJ his Honour’s own reasoned opinion.

Patent

Sanofi’s patent had just one claim:

A method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis, which comprises administering to a recipient an effective amount of pharmaceutical composition containing as an active ingredient a compound of formula I or II … [i.e., leflunomide]

Manner of manufacture

Keane CJ recorded at [25] that Apotex did not press orally its argument that methods of medical treatment are not patentable in Australia. Both judgments, however, explicitly refused to re-open the question following Rescare and Bristol-Myers Squibb in light of long standing practice and Parliament’s lmitation of the exclusion from patentability in s 18(2) to humans and the biological processes for their generation.

Keane CJ, Bennett and Yates JJ would also have granted leave to Apotex to argue on appeal that “methods of medical treatment for a “second or later medical use” not limited by the purpose of the treatment are not patentable inventions.”

Whatever the merits of that ground “(a matter on which we express no view)”, however, Bennett and Yates JJ considered at [195] it could not succeed in this case as there was no disclosure on the face of the specification to found the Microcell argument as interpreted in Bristol-Myers Squibb. Keane CJ at [27] considered the ground as argued failed because, properly construed, the claim did not extend to any use of leflunomide that inevitably had some incidental beneficial effect on psoriasis.

Infringement

The Court unanimously rejected Sanofi’s argument that the claim covered any administration of leflunomide which happened to (or also to) result in the treatment of psoriasis. In this context, their Honours were concerned about giving Sanofi a “monopoly” wider than its disclosure or the consideration for the grant of the patent.

This didn’t help Apotex, however.

First, Apotex’ product was approved for, and its product literature stated it was indicated for the treatment of active rheumatoid arthritis and active psoriatic arthritis. The product literature also stated “Apo-Leflunomide is not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease.”

Use of leflunomide to treat rheumatoid arthritis itself would not infringe. However, those treating psoriatic arthritis knew that the patient would also have psoriasis or, if not treated, would develop psoriasis. Thus, the Full Court agreed with Jagot J that the plain meaning to those skilled in the art of the statement “Apo-Leflunomide is not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease” was an instruction to use Apo-Leflunomide for the treatment of psoriasis in conjunction with the treatment or prevention of psoiratic arthritis.

Secondly, use for the purpose of treating, or preventing, psoriasis in conjunction with psoriatic arthritis would be an infringing use. Their Honours were not overwhelmed by the supposed terrors of determining the purpose for which leflunomide was prescribed, bearing in mind that it was a prescription drug. Bennett and Yates JJ saw this at [126] is simply a question of characterising the impugned conduct. Keane CJ questioned at [38] to [40] whether the proposition from Merrell Dow that infringement did not depend on the infringer’s state of mind was in fact “absolute” and noted that, in circumstances where a prescription only drug was being prescribed by medical practitioners, the purpose of administration should be reasonably ascertainable.

Accordingly, Apotex infringed on the basis of (at least) s 117(2)(c).

Copyright

May be the subject of a later post.

Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) [2012] FCAFC 102

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