A cylinder by any other name (except basket)

Beach J has ruled that there is no warrant for interpreting “basket” in GSK’s patent to mean “cylinder”, with the consequence that the patent was neither infringed, nor invalid.

GSK’s patent is “for a sustained release paracetamol bilayer tablet with a specified in vitro dissolution profile”. Claim 1 is as follows:

A pharmaceutical composition comprising:

a bilayer tablet having an immediate release phase of paracetamol and a sustained release phase of paracetamol,

the immediate release phase being in one layer and comprising from about 10 to 45% by weight of the total paracetamol; and

the sustained release phase being in the other layer and comprising from about 55% to 90% by weight of the total paracetamol in admixture with a matrix forming polymer or a mixture thereof;

said composition comprising from 600 to 700mg of paracetamol per unit dose and a pharmaceutically acceptable carrier,

wherein said composition has an in vitro paracetamol dissolution profile (as determined by the USP type III apparatus, reciprocating basket, with 250ml of 0.1M HCl at 37C set at a cycle speed of 15 strokes/min) with the following constraints:

Ÿ 30 to 48% released after 15 minutes

Ÿ 56 to 75% released after 60 minutes

Ÿ >85% released after 180 minutes.

I have emphasised the word “basket” above because it is a mistake. It should read “cylinder”. It was also a mistake repeated in the body of the specification. Beach J rejected Apotex’ argument that “basket” was a reasonable option for use in a USP type III apparatus at the priority date. However, none of the expert witnesses had heard of such a thing and Beach J held that the skilled addressee[1] would have recognised it was a mistake and should have read “cylinder”.

Now, the High Court has told us that a patent specification is a document directed to the public, but it is to be read through the eyes of the skilled addressee. So, for example, Gleeson CJ, McHugh, Gummow, Hayne and Callinan JJ said in Kimberly-Clark at [24]:

It is well settled that the complete specification is not to be read in the abstract; here it is to be construed in the light of the common general knowledge and the art before 2 July 1984, the priority date; the court is to place itself “in the position of some person acquainted with the surrounding circumstances as to the state of [the] art and manufacture at the time”.[2]

The courts have developed lengthy lists of propositions to implement that directive.[3] One of the propositions that repeatedly gets cited is the rule that you cannot expand or narrow the meaning of a claim by reference to the body of the specification. So, for example, the High Court in Kimberly-Clark itself helpfully said at [15]:

Where the question concerns infringement of a claim or the sufficiency of a claim to “define” the invention, it has been held in this Court under the 1952 Act that the plain and unambiguous meaning of a claim cannot be varied or qualified by reference to the body of the specification. However, terms in the claim which are unclear may be defined or clarified by reference to the body of the specification.[4]

How to reconcile the two?

Well, Beach J held that, notwithstanding the mistake, the words of the claim were clear and unambiguous and there was no warrant to substitute “cylinder” for “basket”. Warned by Apotex’ counsel, Ms Goddard, that the patent was a public instrument the amendment of which was addressed in the Act by a different mechanism,[5] his Honour summarised his conclusion at [14]:

No case expressly binds me to accept the result contended for by GSK. The hypothetical construct of the skilled addressee cannot be taken so far as to re-write or amend a claim of the specification. That conceptual tool has its limits. After all, the boundary constraint is that I am obliged to construe the claim as it is, rather than what it should have been. I accept Apotex’s contention. Accordingly, GSK must fail on infringement as claim 1 is the only independent claim. But Apotex and Generic Partners fail on invalidity.

His Honour elaborated on these conclusions at much greater length at [368] – [401].

Beach J’s rejection of the attacks on invalidity did not turn on whether “basket” meant “basket” or “cylinder”. Having found that “basket” did mean “basket”, the attacks on fair basis, sufficiency and lack of clarity necessarily failed. However, his Honour would also have rejected them even if “he had found ”some polytropic fairy dust“ could transform ”basket“ into ”cylinder”.

 

If you have a comment or a question, please feel free to post it in the comments section. Or, if you would prefer, email me.

GlaxoSmithKline Consumer Healthcare Investments (Ireland) (No. 2) Limited v Apotex Pty Ltd [2016] FCA 608


  1. or “person skilled in the art” to use the language of the Act in s 7. Section 40 wants the person to be skilled in the relevant art, but that shouldn’t be much, if at all, different.  ?
  2. The citations have been omitted, but they included Samuel Taylor Pty Ltd v SA Brush Co Ltd (1950) 83 CLR 617 at 624?625; Welch Perrin & Co Pty Ltd v Worrel (1961) 106 CLR 588 at 610; Sunbeam Corporation v Morphy-Richards (Aust) Pty Ltd (1961) 180 CLR 98 at 102; Populin v HB Nominees Pty Ltd (1982) 41 ALR 471 at 476.  ?
  3. Sheppard J referred to 10 in Decor v Dart. Hely J identified a raft in Beltreco starting at [70]. The Full Court was rather more succinct at [67] in Jupiters.  ?
  4. The citations I have omitted again include reference to Welch Perrin at 610. This rule is Sheppard J’s second proposition, referred to by Hely J at [74] and elaborated at [76] to [78]and the 4th proposition in Jupiter’s.  ?
  5. Presumably, s 104 and, in the court proceeding context, s 105.  ?

RPL Central also refused special leave

The High Court has also refused RPL Central special leave to appeal.

RPL Central had applied for the grant of an innovation patent entitled ‘Method and System for Automated Collection of Evidence of Skills and Knowledge’.

Middleton J had upheld RPL’s appeal from the Commissioner’s decision to reject the application on the grounds it was not a manner of manufacture. The Full Court allowed the Commissioner’s appeal. In rejecting special leave, the High Court baldly stated:

The Full Court was plainly correct and, accordingly, none of the applicant’s proposed grounds of appeal enjoys sufficient prospects of success to warrant the grant of special leave to appeal. Pursuant to r 41.11.1 of the High Court Rules 2004 (Cth), we direct the Registrar to draw up, sign and seal an order dismissing the application with costs.

So, so far as patenting business methods goes in Australia, it looks like Research Affiliates will be the last word … for a long time.

If you have a question or wish to make a comment, feel free to post it in the comments box or send me an email.

RPL Central Pty Ltd v Commissioner of Patents [2016] HCASL 84

Commonwealth can still sue on the undertaking as to damages

The High Court has refused Sanofi and Wyeth special leave to appeal the Commonwealth’s claims on the clopidogrel undertaking as to damages.

You may recall that, when Sanofi and Wyeth got interlocutory injunctions to stop Apotex entering the market with a clopidogrel product, Sanofi had to give the “usual undertaking as to damages“. The patents, however, were held invalid.

Sanofi and Apotex settled the latter’s claim for damages. However, the Commonwealth also brought a claim against Sanofi and Wyeth under the undertakings as to damages, in broad terms claiming as damages the difference between the (higher) price it paid under the Pharmaceutical Benefits Scheme while the injunctions were in force and the lower price that would have applied if the interlocutory injunctions had not kept Apotex out of the market.

Last year, the Full Federal Court rejected Sanofi’s and Wyeth’s arguments that the Commonwealth could not bring a claim under the undertakings. Lauren John, an associate at Allens, reports that the High Court refused Sanofi’s application for special leave last week.

Links to the High Court dispositions here (Sanofi) and here (Wyeth). Ms John provides more detail here.

If you have a question or wish to make a comment, feel free to post it in the comments box or send me an email.

Productivity Commission reports on IP (in draft)

The Productivity Commission has released its draft report into Intellectual Property Arrangements.

You will be startled to learn that the Productivity Commission has discovered Australia is a net importer of intellectual property. We buy more IP from the rest of the world than we sell to it. Fig. 2 in the Report indicates Australian IP earned AUD1 villion from overseas, but we paid out about AUS4.5 billion for the use of their IP. The Productivity Commission then notes that we provide surprisingly strong IP protection for a country in our position.[1] This finding guides the Productivity Commission’s recommendations which might broadly be characterised as: take the least restrictive option in terms of IP protection (where our international obligations permit).

The Productivity Commission explained its position this way:

Intellectual property (IP) arrangements need to balance the interests of rights holders with users. IP arrangements should:[2]

• encourage investment in IP that would not otherwise occur;

• provide the minimum incentives necessary to encourage that investment;

• resist impeding follow-on innovation, competition and access to goods and services. (emphasis supplied)

So, for example, after much gnashing of economists’ teeth about the (let’s face it, indefensible) term of copyright protection, the Productivity Commission considers that the appropriate term of protection is somewhere between 15 and 25 years.[3] However, what it actually recommends is rather more limited:

4.1: remove the current unlimited term of protection for published works.[4]

5.1: implement Parliament’s At What Cost? IT pricing and the Australia Tax recommendation to make it clear that it is not an infringement of copyright to circumvent geoblocking.

5.2 repeal the remaining parallel import restrictions for books.

5.3 amend the Copyright Act 1968 to replace the current fair dealing exceptions with a broad exception for fair use.

The latter two, so far, have elicited the loudest complaints here and here.[13] Meanwhile, the US’ Register of Copyrights is celebrating the first anniversary of her Fair Use Index.

18.1 expand the safe harbours to online service providers.[5]

Patents

The Productivity Commission reports that there are 120,000 active patents registered in Australia. 93% of these have been granted to non-residents. There are also 25,000 – 30,000 applications each year; of which about 60% ultimately proceed to grant.

According to the Productivity Commission, however, there are too many granted patents which do not contribute social value and are not “additional” – in the sense that they would not have been made if there was no patent protection.[6]

This needs to be remedied. However, the Productivity Commission acknowledges that international agreements put constraints on our freedom of action. There are 10 recommendations for patents.

The key recommendation for standard patents is yet another go at raising the threshold of inventive step.

an invention is taken to involve an inventive step if, having regard to the prior art base, it is not obvious to a person skilled in the relevant art.

This looks very similar to what we already have. As the Productivity Commission envisages matters, however, there are important differences. First, it reverses the onus currently expressed in s 7(2). According to the Productivity Commission, the current position is the opposite of where the onus lies in the USA, Japan, the EU and the UK (amongst others). Rather than a challenger having to prove the invention is obvious, therefore, the patentee will have to prove it is not.

Secondly, the Productivity Commission sees the current requirement that there be only a scintilla of invention being raised. The Productivity Commission sees this low threshold being reflected in the limitation on “obvious to try” being something which the skilled addressee would be directly led as a matter of course. Instead, the Productivity Commission considers that the test should be at least:

whether a course of action required to arrive at the invention or solution to the problem would have been obvious for a person skilled in the art to try with a reasonable expectation of success (as applied by the Boards of Appeal of the EPO).[7]

This change would be buttressed with appropriate comments in the Explanatory Memorandum and, additionally, the insertion of an objects clause into the Act. The latter would be intended to ensure that the Courts focused on the social objectives of the Patents Act including, in particular, the public interest.[8]

On the more colourful fronts, the Productivity Commission also recommended repeal of the abomination innovation patent and amendment of s 18 explicitly to exclude from patentable subject matter business methods and software.[9]

Pointing to analysis which estimates the net present value to R & D of the extension of term for a pharmaceutical patentat at year 10 at $370 million – of which only $7.5 million would accrue to Australia because our industry is so small – while the cost to the Australian government and consumers of the same extension of term is estimated at $1.4 billion, the Productivity Commission also wants a significant tightening up of the regime for extending the term of pharmaceutical patents. The Productivity Commission also opposes any extension of the period of data protection for therapeutic goods, including biologics.[10]

The Productivity Commission also recommends exploring raising the renewal fees payable, particularly in later year’s of a patent’s life.

Registered designs

The Productivity Commission considers the registered design system deficient but, as we have committed to it internationally and there is no better alternative, we are stuck with it.

However, continuing the net importer theme, Australia should not go into the Hague system “until an evidence-based case is made, informed by a cost–benefit analysis.”

Trade marks

I’m just going to cut and paste here: the Government should:

  • restore the power for the trade mark registrar to apply mandatory disclaimers to trade mark applications, consistent with the recommendation of the Advisory Council on Intellectual Property in 2004 (the only people that won’t support this are in the place that counts – IP Australia)
  • repeal part 17 of the Trade Marks Act 1995 (Cth) (Trade Marks Act)
  • amend s. 43 of the Trade Marks Act so that the presumption of registrability does not apply to the registration of marks that could be misleading or confusing
  • amend the schedule of fees for trade mark registrations so that higher fees apply for marks that register in multiple classes and/or entire classes of goods and services.
  • require the Trade Marks Office to return to its previous practice of routinely challenging trade mark applications that contain contemporary geographical references (under s. 43 of the Trade Marks Act). Challenges would not extend where endorsements require goods and services to be produced in the area nominated
  • in conjunction with the Australian Securities and Investments Commission, link the Australian Trade Mark On-line Search System database with the business registration portal, including to ensure a warning if a registration may infringe an existing trade mark, and to allow for searches of disclaimers and endorsements.

Also, s 123 should be fixed up so that parallel importing does not infringe.

Like the rest of us, the Productivity Commission is bemused by the Circuits Layout Act and recommends implementing “without delay” ACIP’s 2010 recommendation to enable “essentially derived variety declarations to be made in respect of any [plant] variety.”

On competition policy, s 51(3) should be repealed and the ACCC should develop guidelines on the application of our antitrust rules to IP.

Innovatively, the Productivity Commission also recommends free access to all publications funded directly by Government (Commonwealth, State or Terriroty) or through university funding.

There are also at least 17 requests for further information.

If you are inspired to make a further submission, you should get it in before 3 June 2016.[11]


  1. Not much discussion here whether the best way to get more technological development is through a strong IP regime or to,scrap the IP system and fully commit to free riding.  ?
  2. Despite the tentative nature of this declaration, it is the first “Main key points”.  ?
  3. Draft finding 4.2.  ?
  4. The Government is trying to do this – see schedule 3 of the exposure draft of the Copyright Amendment (Disability Access and Other Measures) Bill (pdf).  ?
  5. See schedule 2 of the Disability Access and Other Measures bill.  ?
  6. You will have to read Appendix D to find out how the Productivity Commission works out which patents are socially valuable and “additional”.  ?
  7. The EPO cases the Productivity Commission referred to are T 149/93 (Retinoids/Kligman) (1995) at 5.2 and T 1877/08 (Refrigerants/EI du Pont) (2010) at 3.8.3.  ?
  8. Here, the Productivity Commission notes that the Full Federal Court rejected reference to the public interest in Grant.  ?
  9. Dr Summerfield tells you why he thinks that’s a bad idea over here and of course, the Europeans (including the UK in that) do not have all sorts of complications carrying out their nice, clean exclusion.  ?
  10. In an interesting departure from its overarching premise that patents do not really contribute much to innovation because there are other protections such as lead time and trade secrets, the Productivity Commission warns that reliance on data secrecy is sub-optimal compared to patent protection.  ?
  11. Bearing in mind they have to submit their Final Report to Government by 18 August 2016.  ?
  12. In between buying your books from Amazon and Bookdepository, some references to the larger economic issues affecting booksellers here.  ?

Servier best method & amendment

Servier has lost what may be its last round[1] in the arginine perindopril litigation against Apotex. Servier began the litigation back in 2007. Ultimately, it lost with its patent being found invalid on the ground that Servier had failed to disclose the best method of performing the invention. After that ruling, Servier applied to amend its patent to include the best method. Its application failed on discretionary grounds. Now, we have the Full Court’s decision dismissing Servier’s appeal from that refusal.

Best method

Servier’s first argument was that, following the High Court’s Kimberley-Clark decision, all s 40(2)(a) required was a disclosure sufficient to enable a skilled person to produce something within each claim without new invention or additions or prolonged study of matters presenting initial difficulty. Servier argued that there was no separate and independent requirement to disclose the “best method”.

After an extensive review of the case law, the Full Court rejected that argument, ruling that disclosure of the best method was indeed a separate requirement. In this case, Servier had failed to comply with that requirement.

Claim 1 of the patent was for the arginine salt of perindopril. There had been an earlier patent for perindopril and sodium and maleate salt forms had been identified. According to the Specification, the arginine salt form had particular stability advantages in conditions of heat and humidity which resulted in longer shelf life and permitted the use of less expensive forms of packaging. The achievement of these advantages, however, could be affected by the method of production. The Specification described the claimed arginine perindopril only as being produced by “a classical method of salification”.

The experts agreed this description of how to prepare the salt was “pregnant with ambiguity” and following from this evidence the trial judge had found this description was “wholly inadequate” and did not:

allow the skilled addressee to follow a routine process of deduction from that description because it leaves open too many variables.

Servier itself had used two different methods before the filing date – the 1986 method and the 1991 method – and another method – the 2002 study – after the priority date. The evidence showed that the method of salification used and variables such as the solvent used and whether and when to stir significantly affected the properties of the resulting salt, including its stability.

Accordingly, the Full Court upheld the trial judge’s conclusion that Servier had not disclosed the best method known to it of performing the invention.

Amendment

Servier had applied after the trial to amend the Specification to add the best method.

The Full Court affirmed the Pfizer Full Court’s ruling that the best method requirement required disclosure of the best method of performing the invention known to the applicant at the filing date. However, it was possible to remedy a failure to disclose the best method by amendment of the Specification made after the filing date.

The Full Court agreed with the trial judge that the amendment power under s 105 could be invoked even after trial and judgment finding all claims invalid. While there was a proprietal interest in being allowed to amend, it was still necessary for the patentee to satisfy the Court that discretionary grounds did not warrant exclusion.

In this case, however, discretionary grounds warranted refusal. Back in 2004, the examiner had issued a report as a result of which Servier’s patent attorney had advised Servier to include a description of the method of manufacture of arginine perindopril, even if it was well known. The inhouse instructor replied “we will see later”.

Although there was no suggestion of bad faith on the part of the inhouse instructor, the Full Court upheld the trial judge’s conclusion that the inhouse instructor’s decision to ignore the advice of her Australian patent attorney was not reasonable.

The Full Court considered that there was no error of principle in the trial judge’s rejection of the length of the delay as otherwise warranting rejection of the application. However, they would appear themselves have felt the trial judge had been overly generous.

Finally, the Full Court allowed Apotex’ appeal from the trial judge’s order that Apotex pay 66% of Servier’s costs. Rather, Servier should pay 40% of Aptex’ costs of the revocation proceeding and 75% of Aptex’ costs of the amendment proceedings.

Les Laboratoires Servier v Apotex Pty Ltd [2016] FCAFC 27 (Bennett, Besanko and Beach JJ)


  1. Barring (potentially) a special leave application.  ?

Science Fiction

Noted science fiction author, Kim Stanley Robinson, imagines a future oral argument trying to patent something in light of recent (US) judicial attempts to clarify business method patenting. Imagine what fun he could have in an imaginary place far far away!

Lid dip: PatentlyO

In the meantime, IPwars is also heading far far way for the holidays. Thank you for reading.

Season greetings! Wishing you a happy, safe and prosperous New Year!

IP Australia’s Myriad Guidelines

IP Australia has published its guidelines for examining whether a patent application claims a manner of manufacture under s 18(1)(a) and (1A)(a) in light of the High Court’s ruling in D’Arcy v Myriad.

According to the guidelines, Examiners will find it useful to ask:

  1. What is the substance of the claim (not merely its form)?
  2. Has the substance of the claim been “made” or changed by man, or is “artificial”?
  3. Does the invention have economic utility?
  4. Does the invention as claimed represent a new class of claim?

In deciding whether the claim is for an established class of invention or a new class of claim, it will not necessarily be relevant that patents have previously been granted for similar subject matter. Examiners are directed to take into account whether the Courts have previously considered the type of subject matter and whether it was rejected or not.

Claims to plants and micro-organisms are not to be considered to fall within a new class merely because they are claims for a plant or micro-organism. Apart from claims to nucleic acid molecules, the guidelines indicate that the Commissioner will consider as excluded subject matter:

• cDNA and synthetic nucleic acids

• Probes and primers

• Isolated interfering/inhibitory nucleic acids,

“where they merely replicate genetic information of a naturally occurring organism”. However, such claims may be patentable where the utility of the invention “lies in genetic information that has been ”made” (e.g. non-naturally occuring chimeric nucleic acid). Other types of biological inventions may also ve patentable where they do not merely replicate the genetic information of a natually occurring organism.

The guidelines should appear in the Manual of Practice and Procedure in January 2016.

Commonwealth can sue on the undertaking as to damages

The Full Court (Dowsett, Kenny and Nicholas JJ) has upheld the Commonwealth’s power to sue for damages on the undertaking as to damages given by Sanofi and Wyeth when obtaining interlocutory injunctions against generic suppliers.

Sanofi sued Apotex (then called GenRX) for patent infringement when the latter sought to registration in the Therapeutic Goods Register of drug containing clopidogrel. Sanofi obtained an interlocutory injunction preventing the listing and sale of Apotex’ product, on terms of the “usual undertaking as to damages”. Thus, as a condition of obtaining the interlocutory relief, Sanofi undertook to the court:

(a) to submit to such order (if any) as the Court may consider to be just for the payment of compensation, to be assessed by the Court or as it may direct, to any person, whether or not a party, adversely affected by the operation of the interlocutory order or undertaking or any continuation (with or without variation) thereof; and

(b) to pay the compensation referred to in (a) to the person there referred to. (emphasis supplied)

After the trial judge found Sanofi’s patent valid and infringed, the Full Court on appeal held that the patent was invalid. Ultimately, the High Court refused special leave.[1]

The Commonwealth, which was not a party to either the Sanofi or Wyeth proceedings is now claiming compensation from Sanofi and Wyeth under the “undertaking as to damages”. In broad terms, it says it suffered losses because the price it paid under the Pharmaceutical Benefits Scheme was higher than it would have been if the generic parties had not been prevented from listing and selling their products by the interlocutory injunctions.

Sanofi and Wyeth argued that sections 26B, 26C, 26D of the Therapeutic Goods Act[2] precluded the Commonwealth from claiming under the usual undertaking as to damages. The Full Court held, however, that these provisions were ancillary or additional to the Court’s powers under the undertaking. They did not provide an exhaustive code which excluded the operation of the undertaking.

Dowsett J delivered a concurring judgment, suggesting at [20] that some restriction on the scope of the usual undertaking should have been sought and then questioning, if such a restriction had been sought, whether it would have been appropriate to grant the interlocutory injunction:

…. As the Commonwealth was not a party to the proceedings in which the undertakings were given, they were presumably not extracted at its request. I infer that the Court extracted the undertakings. It is not suggested that it lacked the power to do so in order to protect the interests of identified or unidentified third parties. In submitting that the Commonwealth may not recover other than pursuant to s 26C, the Sanofi and Wyeth parties effectively seek to resile from their undertakings. It may be simply too late for them to do so. Any limitations upon the undertakings ought to have been sought at the time at which they were given. The Court would then have had to consider whether such limited undertakings were sufficient to justify the grant of the interlocutory injunctions. The Commonwealth has not put its case in that way. However, in any event, I see no basis for limiting the Commonwealth’s right to seek to enforce the undertakings to the extent that it benefits under them.

If only the regime under sections 26B, 26C, 26D had been available, it looks like Sanofi’s and Wyeth’s exposure would have been limited to situations where they had given false or misleading certificates or did not have “reasonable prospects of success”.[3]

Commonwealth of Australia v Sanofi (formerly Sanofi-Aventis) [2015] FCAFC 172


  1. Similarly, in the Wyeth proceedings an interlocutory injunction was granted on the usual undertaking as to damages, but the patent was ultimately found to be invalid.  ?
  2. These provisions were introduced as part of the package implementing the Australia – United States Free Trade Agreement relating particularly to the 5 year data exclusivity for pharmaceutical test data.  ?
  3. Defined in s 26C(4) as “(4) For the purpose of paragraph (3)(b), proceedings have reasonable prospects of success if: (a) the second person had reasonable grounds in all the circumstances known to the second person, or which ought reasonably to have been known to the second person (in addition to the fact of grant of the patent), for believing that he or she would be entitled to be granted final relief by the court against the person referred to in paragraph (1)(a) for infringement by that person of the patent; and (b) the second person had reasonable grounds in all the circumstances known to the second person, or which ought reasonably to have been known to the second person (in addition to the fact of grant of the patent), for believing that each of the claims, in respect of which infringement is alleged, is valid; and
    (c) the proceedings are not otherwise vexatious or unreasonably pursued.”  ?

IP Australia consults on patenting genetic material post Myriad

Following the High Court’s ruling that Myriad’s claims for isolated DNA relating to BRCA1 were not patentable subject matter, IP Australia has released a “consultation” on how it proposes to treat patent applications claiming genetic material.

The Commissioner considers that the High Court’s ruling excludes from ‘manner of manufacture’ a claim “to an isolated nucleic acid that merely represents information coding for a polypeptide is not patent eligible.”

Accordingly, at this stage, IP Australia contemplates rejecting as not manners of manufactures claims to:

  • Naturally occurring (human) nucleic acid sequences encoding polypeptides or functional fragments thereof -either isolated or synthesised
  • Naturally occurring (non-human) nucleic acid sequences encoding polypeptides or functional fragments thereof – either isolated or synthesised
  • cDNA
  • Naturally occurring human and non-human coding RNA – either isolated or synthesised

On the other hand, IP Australia considers the following could be patent subject matter:

  • Naturally occurring isolated regulatory DNA (e.g. promoters, enhancers, inhibitors, intergenic DNA)
  • Isolated non-coding (e.g. “Junk”) DNA
  • Isolated non-coding RNA (e.g. miRNA)
  • Naturally occurring isolated bacteria
  • Naturally occurring isolated virus Isolated polypeptides
  • Synthesised/modified polypeptides
  • Isolated polyclonal antibodies
  • Chemical molecules purified from natural sources (e.g. new chemical entities, antibiotics, small molecules) Isolated cells Isolated stem cells
  • Probes
  • Primers Isolated interfering/inhibitory nucleic acids (e.g. antisense, ribozymes)
  • Monoclonal antibodies Fusion/chimeric nucleic acids
  • Transgene comprising naturally occurring gene sequences
  • Vectors/microorganisms/animals/plants comprising a transgene

The Commissioner is interested in receiving comments on her proposed practice by 30 October 2015.

Myriad’s BRCA1 claims – take 2

As previously noted, the High Court has unanimously ruled that Myriad’s 3 claims for isolated nucleic acids for the BRCA1 gene that codes for specific mutations and polymorphisms are invalid.[1]

Claim 1 was:

An isolated nucleic acid coding for a mutant or polymorphic BRCA1 polypeptide, said nucleic acid containing in comparison to the BRCA1 polypeptide encoding sequence set forth in SEQ.ID No:1 one or more mutations or polymorphisms selected from the mutations set forth in Tables 12, 12A and 14 and the polymorphisms set forth in Tables 18 and 19.

Claims 2 and 3 were subsidiary claims for narrower formulations.

The sole issue in the case was whether claims 1 to 3 of Myriad’s patent were a “manner of manufacture” within the meaning of s 18(1)(a) of the Patents Act – what the American’s refer to as subject matter or patentable subject matter. There was no challenge to the novelty or inventive step of the claim – the basis on which the corresponding patent was rejected in Europe.

There was also no challenge to claims 4 – 30, which Gordon J at [191] and [257] characterised as applications of the isolated gene sequences to various purposes such as a probe (claim 4), vectors (claims 5 – 7), methods of producing mutant or polymorphic BRCA1 polypeptides (claims 8 – 9), preparations and uses of polypeptides (claims 10 – 16) and methods of diagnosis (claims 17 – 30).

Previously, this question fell to be determined according to the principles declared in the “watershed” NRDC case. All 3 sets of reasons acknowledged the continued relevance of that decision, but appear to have qualified its teaching in potentially far-reaching ways.

French CJ, Kiefel, Bell and Keane JJ

The majority judgment was delivered by French CJ, Kiefel, Bell and Keane JJ.

A narrow approach

At one level (one might hope the right level), their Honours’ judgment can be seen as focusing very specifically on the singular nature of Myriad’s claim. Thus, at [6], their Honours said:

Despite the formulation of the claimed invention as a class of product, its substance is information embodied in arrangements of nucleotides. The information is not “made” by human action. It is discerned. That feature of the claims raises a question about how they fit within the concept of a “manner of manufacture”. As appears from s 6 of the Statute of Monopolies, an invention is something which involves “making”. It must reside in something. It may be a product. It may be a process. It may be an outcome which can be characterised, in the language of NRDC, as an “artificially created state of affairs”. Whatever it is, it must be something brought about by human action. ….

In their Honours’ conception, that was not the case here. The judgment continues at [6]:

The requirement, in each claim, that the sequence in the isolate bear specified mutations or polymorphisms raises the same problem in a particular way. Satisfaction of that integer depends upon a characteristic of the human being from whom the nucleic acid is isolated, a characteristic which is not shared by all human beings. It has nothing to do with the person who isolates the nucleic acid bearing the mutant sequence.

That is, nothing was “made”. Rather, the gene sequence with the relevant mutation(s) and/or polymorphism(s) was made in the individual from whom the genetic material had been extracted. “All” that Myriad did was whittle that genetic material down to identify whether or not the relevant mutation or polymorphism was present.[2]

Further, at [8]:

…. The size of the class of the products as defined is large. No upper limit was suggested in argument. The boundaries of the class are not defined by a limiting range of chemical formulae. There is a real risk that the chilling effect of the claims, on the use of any isolation process in relation to the BRCA1 gene, would lead to the creation of an exorbitant and unwarranted de facto monopoly on all methods of isolating nucleic acids containing the sequences coding for the BRCA1 protein. The infringement of the formal monopoly would not be ascertainable until the mutations and polymorphisms were detected. Such a result would be at odds with the purposes of the patent system.[3]

One might wonder how one works out whether or not the “monopoly” that would arise would be “exorbitant and unwarranted”. The size of the class claimed seems problematic, the “chilling effect” also might be thought something that flows from the grant of any patent. Why for example would that be any more of a problem than for the patents granted originally over compounds such as omeprazole or rosuvastating or any number of other drugs?

Moreover, the problem of infringement loomed very large. No-one could know in advance whether or not what they were doing would infringe. It would depend on whether a relevant mutation or polymorphism was present in the individual from whom the genetic material was extracted. One might say, of course, that one would not be at risk of infringing unless one was looking for the BRCA1 sequence. One might also say, at least up until today, that there was no bar to patenting omeprazole or rosuvastatin or any other chemical substance just because one had found a specific use for it such as treating disease A when, after the compound had been discovered, someone else might be precluded from investigating its use, surprisingly, to treat disease B.[4]

The problem seems particularly to come back to the nature of the claim as being tosomething generated in an individual naturally and independently of any action by the patentee.

Wider ramifications

French CJ, Kiefel, Bell and Keane JJ did not just declare that claims 1 to 3 were not patentable subject matter. Their Honours went on to explain the principles that should be applied in future.

First, their Honours accepted at [18] that the NRDC test was still the appropriate question:

“Is this a proper subject of letters patent according to the principles which have been developed for the application of s 6 of the Statute of Monopolies?”

As I tell my patents class students, that provides us with an awful lot of guidance! Their Honours continued:

That question is to be answered according to a common law methodology under the rubric of “manner of manufacture” as developed through the cases, but consistently with “a widening conception of the notion [which] has been a characteristic of the growth of patent law.” That widening conception is a necessary feature of the development of patent law in the 20th and 21st centuries as scientific discoveries inspire new technologies which may fall on or outside the boundaries of patentability set by the case law which predated their emergence.

So far, still so good; particularly the recognition of the need for the concept to continue developing.

The “common law methodology” is further explained in [5] – [7] and troubled French CJ in Apotex v Sanofi. The first point appears to be, if the claim falls within an existing recognised class of patentable subject matter, it is a manner of manufacture. If it is a new class, however, “policy factors informed by the purpose of the Act and considerations of coherence in the law” need to be considered. Moreover, there are limits in judicial law-making “inherent in common law methodology”:

Where an affirmative application of the concept is likely to result in the creation of important rights as against the world, to involve far-reaching questions of public policy and to affect the balance of important conflicting interests, the question must be asked whether that application is best left for legislative determination. The patentability of nucleotide sequences derived from human DNA is in that category. The inherent patentability of the invention as claimed would powerfully imply patentability of any claim for an isolated nucleic acid coding for a specified polypeptide.

Notwithstanding 50+ years of the Courts successfully applying the NRDC formula, this High Court is plainly very uncomfortable with that role.

For those 50+ years since NRDC, we had been thinking there were 2 (or 3) requirements for patentable subject matter:

  1. Whether the invention as claimed is for a product made, or a process producing an outcome as a result of human action; and
  2. Whether the invention as claimed has economic utility.[5]

French CJ, Kiefel, Bell and Keane JJ confirmed that requirements 1 and 2 are still necessary. As foreshadowed in paragraph [6], however, their Honours said that requirements 1 and 2, while necessary, are not in themselves sufficient.[6] Other factors must be taken into account. At [28], their Honours laid out four further considerations:

  1. Whether patentability would be consistent with the purposes of the Act and, in particular:
    1. whether the invention as claimed, if patentable under s 18(1)(a), could give rise to a large new field of monopoly protection with potentially negative effects on innovation;
    2. whether the invention as claimed, if patentable under s 18(1)(a), could, because of the content of the claims, have a chilling effect on activities beyond those formally the subject of the exclusive rights granted to the patentee;
    3. whether to accord patentability to the invention as claimed would involve the court in assessing important and conflicting public and private interests and purposes.
  2. Whether to accord patentability to the invention as claimed would enhance or detract from the coherence of the law relating to inherent patentability.
  3. Relevantly to Australia’s place in the international community of nations:
    1. Australia’s obligations under international law;
    2. the patent laws of other countries.
  4. Whether to accord patentability to the class of invention as claimed would involve law-making of a kind which should be done by the legislature.

The new, additional factors 1, 2 and 4 above were described as the most important in the balancing process the inquiry envisaged by their Honours.[7]

Having regard to these considerations, French CJ, Kiefel, Bell and Keane JJ declared at [94]:

Although it may be said in a formal sense that the invention as claimed, referring to isolated nucleic acids, embodies a product created by human action, that is not sufficient to support its characterisation as a manner of manufacture. The substance of the invention as claimed and the considerations flowing from its substance militate against that characterisation. To include it within the scope of a “manner of manufacture” involves an extension of that concept, which is not appropriate for judicial determination. Further, to include this class of claim within that concept would not contribute to coherence in the law as was the case in Apotex. Nor do Australia’s international obligations and the differently framed patent laws of other jurisdictions, which were referred to earlier in these reasons, support the conclusion that this class of claim should fall within the concept.

The “substance of the invention” and the considerations flowing

In the decision of the Full Federal Court under appeal, it had been pointed out that isolated DNA was in fact man made – it didn’t occur in nature. French CJ, Kiefel, Bell and Keane JJ, however, considered that was to elevate form over substance. So at [90], their Honours accepted a submission from the appellant:

“Myriad’s claims are simply not expressed in terms of chemical composition, nor do they rely in any way on the chemical changes that result from the isolation of a particular section of DNA. Instead, the claims understandably focus on the genetic information encoded in the BRCA1 and BRCA2 genes.”

That characterisation, so far as it emphasises the focus of the claims on genetic information, is applicable to the claims in this case and, contrary to the view of the Full Court, should be accepted.

At [93], their Honours then emphasised:

When proper regard is paid to their emphasis on genetic information, the subject matter of the claims lies at the boundaries of the concept of “manner of manufacture”. That it does lie at the boundaries is further evidenced by the odd consequence that if the claims are properly the subject of a patent, the patent could be infringed without the infringer being aware of that fact. That consequence coupled with the very large, indeed unquantified size of the relevant class of isolated nucleic acids, all of which bear the requisite information, raises the risk of a chilling effect upon legitimate innovative activity outside the formal boundaries of the monopoly and risks creating a penumbral de facto monopoly impeding the activities of legitimate improvers and inventors.

The characterisation of the claims as “information”[8] has some affinity for Gordon J’s approach, discussed briefly below, ruling that the claims were to a mere discovery rather than invention. As discussed above under A narrow approach, this seems to flow from the singular nature of the claims in suit with the consequent uncertainties, particularly for infringement.

An extension of the concept

How do you tell that Myriad’s claim involved an extension of the concept of manufacture?

It is true that no court in Australia had ruled on the patentability of isolated gene sequences until the Myriad litigation. However, the Patent Office has been granting patents for ‘man made’ microbes since 1976 and for isolated genetic material since 1995. The legislative history showed that Parliament rejected an attempt to exclude genetic material from patentable subject matter when passing the 1990 Act. A further attempt to exclude human genetic material was rejected in the Senate in 2011. Two inquiries by Government agencies in the 2000s had also endorsed the status quo and recommended against exclusion. Indeed, the Government of the day had publicly announced its acceptance of the ALRC’s recommendation not to exclude isolated genetic materials from patentability. French CJ, Kiefel, Bell and Keane JJ said at [37]:[9]

This Court is not concerned in this appeal with “gene patenting” generally, but with whether the invention as claimed in Claims 1 to 3 falls within established applications of the concept of manner of manufacture. If it does not, then the question is one of inclusion not exclusion. The legislative history cannot be read as impliedly mandating the patentability of claims for inventions relating to isolated nucleic acids coding for particular polypeptides. The legislative history does not assist the Court in answering the question posed in this appeal.

Contribute to coherence

[Apotex][apotex] had (more or less) upheld the status of methods of medical treatment as patentable subject matter. That contributed to coherence because there was no rational basis to distinguish between patenting medical products and patenting methods of treatment.

Here, arguable, the nature of the claim as already discussed means it is impossible to assess the risks of infringement in advance. That presumably does not promote coherence. Their Honours also focused on the broad range of what was claimed and the potential impacts on future researchers. As already discussed, it may be difficult to distinguish those aspects from claims to other chemical compounds.

Gageler and Nettle JJ

Given the length of this post already, I shall only comment briefly on the remaining judgments.

Like French CJ, Kiefel, Bell and Keane JJ, Gageler and Nettle JJ considered at [125] that “an artificial state of affairs” and “economic utility” were necessary requirements for patentable subject matter, but not sufficient.

Also like French CJ, Kiefel, Bell and Keane JJ, Gageler and Nettle JJ stated at [144] that the question of patentable subject matter must be looked at as a matter of substance rather than form.

Invoking Microcell and Philips v Mirabella, their Honours considered at [133] that patentable subject matter involved a threshold inquiry of “inventiveness”.

Products of nature therefore did not qualify as at [136] they lacked the necessary quality of inventiveness. Gageler and Nettle JJ considered that Myriad’s claims were properly characterised as merely claims to products of nature.

Earlier at [128], Gageler and Nettle JJ had said:

Regardless, however, of the amount of labour involved or the differences between the product and the raw natural material from which it is derived, it is necessary that the inventive concept be seen to make a contribution to the essential difference between the product and nature.

Then, at [134], their Honours said:

Here, the essence of claim 1 is the correlation between the incidence of cancer and the presence of the specified mutations and polymorphisms in the mutated BRCA1 gene. Such ingenuity as that entails consists in the idea of examining an isolated fragment of a patient’s naturally occurring DNA constituted of the BRCA1 gene for the presence or absence of the specified mutations and polymorphisms. The subject matter of the claim does not make any contribution to the inclusion of the specified mutations and polymorphisms in the mutated BRCA1 gene. Their presence or absence in or from it is the result of the isolated BRCA1 gene being part of the naturally occurring DNA from which the sequence is isolated. To adopt and adapt the reasoning in NV Philips’ Gloeilampenfabrieken Application, it is “the inevitable result of that which is inherent in the [DNA]”.[10]

Like the reasons of French CJ, Kiefel, Bell and Keane JJ, this passage emphasises that Myriad did not itself make, or cause to be made, the relevant material. Rather, it was generated in the human body independently of any action by Myriad.

Thus, Gageler and Nettle JJ said at [139]:

…. the BRCA1 gene is not patentable as such because it is a naturally occurring phenomenon which lacks the quality of inventiveness necessary to qualify as a manner of new manufacture.

Gordon J

Gordon J at [222] – [225] specifically rejected D’Arcy’s argument that “naturally occurring things, or products or phenomena or principles of nature are excluded as a proper subject matter of a patent.” These were too vague, malleable and imprecise to be useful tools.

Instead, her Honour focused on the role isolation of the nucleic acid played: it simply allowed identification of the presence, or absence, of naturally occurring mutations or polymorphisms. Gordon J then advanced five reasons why the claims did not qualify as patentable subject matter:

  1. The claim is to multiple products, not a single product: [231]-[239];
  2. Although Myriad claims a class of chemical compounds as a product, it cannot delineate the bounds of its claim by reference to chemical composition: [240]-[243];
  3. Myriad did not create, make or alter the characteristic, the code: [244]-[249];
  4. There is no idea, concept or principle embodied in a manner of new manufacture: [250]-[258]; and
  5. The claim is too broad: [259]-[264].

Points 1, 2 and 5 focus on the sheer number and variety of compounds or sequences which were embraced. So at [241] and [242], her Honour recorded that Myriad could not identify the boundaries of the claims:

…. it is not possible for Myriad to record all of the various chemical compounds (or products) that might be produced by isolating an individual’s nucleic acid. For example, as Myriad accepted during argument, the claim is to an “extremely wide number” of chemical compounds where the compound formulae would vary according to the number of sequences extracted but the compound would nevertheless contain one or more of the specific mutations or polymorphisms.

As has been seen, changes in chemical composition are not limited to variation in the number of nucleotides. So, although the claimed product is a chemical compound, Myriad did not and cannot delineate the bounds of the class of compounds by reference to the chemical composition of the class of the claimed product. Instead, Myriad sought to delineate the boundaries of the claim by reference to what it described as the “characteristics identified within the claim” – the specific mutations and polymorphisms, represented by the code.

I am not sure why delineation by class of compound would be any more precise than the method chosen by Myriad – if you know, please leave a comment.

Under point 5, her Honour also pointed out the concern that no-one could know in advance whether they infringed or not and, if the role of the claim, is to identify the boundaries of the monopoly, that does rather cause a problem.

Under point 4, Gordon J referred to the nature of invention as discussed in the Hickton Patent Syndicate case:

In my opinion, invention may lie in the idea, and it may lie in the way in which it is carried out, and it may lie in the combination of the two; but if there is invention in the idea plus the way of carrying it out, then it is good subject-matter for Letters Patent. (Gordon J’s emphasis)

Her Honour considered that claims 1 to 3 failed to qualify because they did not carry out Myriad’s discovery that certain mutations or polymorphisms indicated increased risk of breast cancer. Gordon J said:

[254] Here, having located the BRCA1 gene and identified its nucleic acid sequence, Myriad’s idea, concept or principle is that specific mutations or polymorphisms in that sequence suggest a predisposition to breast cancer and ovarian cancer.

[255] How then is that idea carried out in claim 1? It is not. It is not and could not be carried out – as claim 1 suggests – by creating a product comprising isolated nucleic acid from a patient which contains the identified characteristic in any one of its many forms. As has been seen, Myriad does not claim the methods by which it isolates the nucleic acid or the methods by which it identifies the sequence of the patient’s nucleic acid. Myriad does not claim the characteristic. Claim 1 is not a claim to the idea, concept or principle.

Gordon J contrasted these claims to claim 4 which used the discovery to create a probe to test for the presence or absence of mutations. That was an invention. So analysed, claims 1 to 3 might be seen to be ‘mere’ discoveries’ rather than an application or now to offend against the enablement and sufficiency requirements.

Some other scary thoughts

First, it is not entirely clear from the decision whether cDNA is patentable subject matter as the US Supreme Court accepted. French CJ, Kiefel, Bell and Keane JJ said at [73]:

Nor, as previously noted, are the claims subject to any process?based limitation involving the breaking up and physical stitching together of the sequences comprising the isolated nucleic acids which are the products the subject of the claims. The “conceptual” stitching together, which may be regarded as the ordered compilation of information defining the relevant sequence, falls outside the claims entirely. The claims encompass molecules comprising isolated nucleic acids containing coding nucleotides arranged in the same sequence as appears in the DNA from which they were derived, whether or not introns and other non-coding sections have been removed from the relevant stretch of that DNA.

That might leave room for debate that cDNA could qualify. Also, the exclusion of introns or other “non-conding regions” might ameliorate the “chilling effects”. Gageler and Nettle JJ, however, at [116] characterised the claims as claiming “the uninterrupted sequence of nucleotides without introns”, i.e., cDNA. According to Gordon J at [283], the parties agreed that, if the claims were not patentable subject matter, they would not be saved where they extended to cDNA.

Philips v Mirabella!

Dr Patentology has called Philips the second worst ever patent judgment by the High Court. No argument from me. Turns out, we’re both wrong. At least 6 judges of the current High Court consider it good law[11] and appear to use it as their touchstone of patent principles.

I would say we need legislative reform but, as the Angel of Lake said, “Before you choose your wish son You better think first ….”

D’Arcy v Myriad Genetics Inc [2015] HCA 35


  1. According to Gordon J at [205] a “mutation” is a variation in a gene sequence “private to an individual or that indiviual’s immediate family.” In contrast, at [207] a “polymorphism is a genetic variant which has arisen in a distant common ancestor and is therefore not unique to an individual or that individual’s immediate family. Forty per cent of women in the general female population have one or more polymorphisms in the BRCA1 gene that are not found in the remaining 60 per cent of the population.”  ?
  2. Gageler and Nettle JJ also focused on this point at e.g. [162]. See also Gordon J at [248].  ?
  3. Citing Cornish, Llewellyn and Aplin for the final conclusion.  ?
  4. Of course, these days, s 119C would probably provide one with a defence to infringement, at least for the research into the possible use.  ?
  5. In fact, the Full Federal Court in Grant has told us there is a the third requirement: a physical transformation of something. Arguably, that was not in issue in Myriad as the isolated gene sequence was physically different to the unisolated genetic material in the human body to an extent.  ?
  6. Insofar as the claim falls within existing concepts of “manner of maufacture” as it has been developed through the cases, their Honours said at [28] requirements 1 and 2 “will also ordinarily be sufficient.” (emphasis supplied)  ?
  7. The survey of foreign laws didn’t really help as it was only the USA following the US Supreme Court’s Myriad decision that appears to have ruled out patent protection for isolated genetic material.  ?
  8. Optimistically hoping it was the claim to “information” rather than just genetic information which was important.  ?
  9. Gageler and Nettle JJ took a similar position at [171]. Nicholas J reviewed the legislative history at [113] – [123] in Cancer Voices.  ?
  10. A different Philips case, which their Honours read as endorsed by NRDC: (1954) 71 RPC 192 at 194, quoted in NRDC (1959) 102 CLR 252 at 279.  ?
  11. In addition to Gageler and Nettle JJ, see French CJ, Kiefel, Bell and Keane JJ at [12].  ?