Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd

• Jurisdiction: Australia Federal only
• Judge: French CJ.,Hayne J,Crennan,Kiefel JJ.,Gageler J.
• Judgment Date: 04 December 2013
• Neutral Citation: 2013-1204 HCA A,[2013] HCA 50
• Docket Number: S219/2012 & S1/2013
• Date: 04 December 2013
• Court: High Court

[2013] HCA 50

HIGH COURT OF AUSTRALIA

French CJ., Hayne, Crennan, Kiefel, Gageler JJ

S219/2012 & S1/2013

Apotex Pty Ltd

Applicant/Appellant

and

Sanofi-Aventis Australia Pty Ltd & Ors

Respondents

Representation

D K Catterns QC with N R Murray for the applicant/appellant (instructed by Herbert Smith Freehills)

D F Jackson QC with C Dimitriadis for the respondents (instructed by Jones Day)

Patents Act 1990 (Cth), ss 13(1), 18(1)(a), 18(2), 117(1), 119A, 138(3)(b), Sched 1.

Statute of Monopolies 1623 (21 Jac I c 3), s 6.

Therapeutic Goods Act 1989 (Cth), s 16(1).

Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd

Intellectual property - Patents - Patent claimed administration of pharmaceutical substance as method of preventing or treating medical condition - Whether method of medical treatment of human body is patentable invention within meaning of s 18(1)(a) of Patents Act 1990 (Cth) - Whether product or process is manner of manufacture within meaning of s 6 of Statute of Monopolies - Whether novel therapeutic use of known substance is patentable invention.

Intellectual property - Patents - Infringement - Construction of claim - Patent claimed use of pharmaceutical substance for preventing or treating medical condition - Whether person who supplies drug and indicates use for treatment of different condition infringes patent under s 117(1) of Patents Act 1990 (Cth).

Words and phrases - "manner of manufacture", "patentable invention".

Matter No S1 of 2013

Appeal dismissed with costs.

Matter No S219 of 2012

1. Special leave to appeal on ground 3 of the Draft Notice of Appeal filed on 10 September 2012 granted.

2. Appeal allowed with costs.

3. Set aside the orders of the Full Court of the Federal Court of Australia made on 18 July 2012 and, in their place, order that:

• (a) the appeal be allowed in part;

• (b) orders 2, 3 and 6 of the Federal Court made on 18 November 2011 be set aside;

• (c) order 1 of the Federal Court made on 24 February 2012 be set aside; and

• (d) so much of the Amended Application dated 22 September 2009 as made in paragraphs 14 to 22 be dismissed.

4. Remit the matter to the Full Court on the questions of the costs of the appeal to that Court and the costs of the trial (which latter question may, at the discretion of the Full Court, be remitted to the primary judge).

French CJ.

Introduction

1 1 The primary question in this case is whether methods of medical treatment of human beings, including surgery and the administration of therapeutic drugs, can be the subject of patents. This Court has not had to decide the question until now. For the reasons that follow, in particular so that the law may be logically coherent, the question ought to be answered in the affirmative. The appellant, Apotex Pty Ltd ("Apotex"), which was sued by the respondents for infringement of their patent for a method of using a known drug to prevent or treat psoriasis, therefore fails in its challenge to the validity of the patent. However, for the reasons given by Crennan and Kiefel JJ 1, Apotex's application for special leave to appeal against the finding in the Federal Court that it infringed the patent should be granted and its appeal on that matter allowed.

Factual and procedural history

2 2 It is sufficient to outline briefly salient features of the factual and procedural history, which are dealt with in more detail in the judgment of Hayne J 2 and the joint judgment of Crennan and Kiefel JJ 3.

3 3 The drug Leflunomide, the preparation and composition of which were the subject of an expired Australian patent 4, is used for the treatment of psoriatic and rheumatoid arthritis. A method of using Leflunomide is the subject of a current Australian Patent No 670491 entitled "Pharmaceutical for the treatment of skin disorders" ("the Patent"). The Patent has a priority date of 31 March 199and expires on 29 March 2014. It has a single 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 a pharmaceutical composition containing as an active ingredient a compound of the formula I or II".

4 The formulae are then set out. A compound of the formula I is Leflunomide. The validity of the Patent is in issue in this appeal. Apotex contends that it relates to a method of medical treatment and cannot be a patentable invention under the Patents Act 1990 (Cth) ("1990 Act"). In the alternative, Apotex contends that the claim in the Patent is for a second or subsequent medical use of a previously known product involving the purpose of its use as an element and that on that ground, it does not disclose a patentable invention.

5 4 The second respondent, Sanofi-Aventis Deutschland GmbH, is the registered owner of the Patent. The first respondent, Sanofi-Aventis Australia Pty Ltd, supplies Leflunomide in Australia under the trade names "Arava" and "Arabloc". Apotex obtained registration of generic versions of Leflunomide (collectively, "Apotex Leflunomide Products") on the Australian Register of Therapeutic Goods in or about July 2008. Its intention was to supply the products and offer them for supply in Australia as treatments for psoriatic arthritis and rheumatoid arthritis. The respondents initiated proceedings against Apotex in the Federal Court of Australia on 23 October 2008 5. They alleged that Apotex's proposed supply of the Apotex Leflunomide Products for the treatment of psoriatic arthritis would infringe the Patent. Other causes of action not material to this appeal were also asserted.

6 5 In support of their infringement claim, the respondents alleged, inter alia:

• • Apotex intended to supply and offered to supply in Australia the Apotex Leflunomide Products for the treatment of active psoriatic arthritis.

• • The use by a person of the Apotex Leflunomide Products for the treatment of active psoriatic arthritis would infringe claim 1 of the Patent.

• • That use would be in accordance with instructions for the use of the products given by Apotex to such a person.

• • Each supply or offer to supply made by Apotex of any of the Apotex Leflunomide Products for the treatment of active psoriatic arthritis would infringe claim 1 of the Patent pursuant to s 117 of the 1990 Act.

7 Apotex cross-claimed for revocation of the Patent on a variety of grounds, none of which succeeded.

8 6 On 18 November 2011, the primary judge dismissed the cross-claim and made a declaration that Apotex had threatened to infringe claim 1 of the Patent "by threatening to import, market, take orders for, sell, supply and offer to supply products containing leflunomide ... in Australia for the treatment of psoriatic arthritis." 6 Her Honour granted injunctive relief restraining Apotex from infringing claim 1 and from supplying or offering to supply products containing Leflunomide for the treatment of psoriatic arthritis. Apotex appealed to the Full Court of the Federal Court. On 18 July 2012, the Full Court (Keane CJ 7, Bennett and Yates JJ 8) dismissed the appeal and ordered that Apotex pay the respondents' costs of the appeal.

9 7 On 14 December 2012, this Court (French CJ and Kiefel J) granted special leave to Apotex to appeal from the judgment of the Full Court in relation to the validity of the Patent and referred the application for special leave in relation to infringement to an enlarged Bench for further consideration so that it could be argued as if it were on an appeal 9.

Patentability of medical treatments - A "common law" question?

10 8 The single ground upon which special leave was granted was that the Full Court erred in finding that the claim of the Patent claimed a manner of manufacture within the meaning of s 18(1) of the 1990 Act. The first question raised by Apotex in support of that ground is whether a method of medical treatment of human beings is capable of being a patentable invention. That question directs attention to the relevant statutory language and the body of case law which has informed its application.

11 9 Section 18 of the 1990 Act lists necessary conditions for an invention to be a patentable invention for the purposes of a standard patent. One of those conditions, set out in s 18(1)(a), is that 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".

12 Despite the classificatory character of the criterion, the question whether it is to be met in respect of a claim for an invention is not answered simply by asking whether such a claim is "a manner of manufacture". As this Court said in National Research Development Corp v Commissioner of Patents (" NRDC") 10:

"The right question is: '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?'"

13 It is relevant to that inquiry that the term "manner of manufacture" originated as part of a statute which was seen as declaratory of the common law. Its application in various statutory embodiments since the Statute of Monopolies 1623 ("the Statute") 11 was enacted has evolved according to common law processes. It has always been applied 12:

"beyond the limits which a strict observance of its etymology would suggest, and ... a widening conception of the notion has been a characteristic of the growth of patent law."

14 10 The Statute was a response to the abuse of grants of monopolies 13 in the purported exercise of the royal prerogative 14. It declared all monopolies void, subject to the proviso in s 6:

"Provided also That any Declaration before mentioned shall not extend to any Letters Patents and Grant of Privilege for the term of fourteen years or under, hereafter to be made of the sole working or making of any manner of...