[2013] HCATrans 123
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S219 of 2012
No S1 of 2013
B e t w e e n -
APOTEX PTY LTD ACN 096 916 148
Applicant/Appellant
and
SANOFI‑AVENTIS AUSTRALIA PTY LTD
First Respondent
SANOFI‑AVENTIS DEUTSCHLAND GMBH
Second Respondent
AVENTISUB II INCORPORATED
Third Respondent
FRENCH CJ
HAYNE J
CRENNAN J
KIEFEL J
GAGELER J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON TUESDAY, 28 MAY 2013, AT 10.15 AM
Copyright in the High Court of Australia
____________________
MR D.K. CATTERNS, QC: May it please the Court, I appear with my learned friend, MR N.R. MURRAY, for the applicant/appellant. (instructed by Herbert Smith Freehills)
MR D.F. JACKSON, QC: If the Court please, I appear with my learned friend, MR C. DIMITRIADIS, for the respondents. (instructed by Jones Day)
FRENCH CJ: Yes, Mr Catterns.
MR CATTERNS: May it please the Court. Your Honours, so far as the application for special leave goes, we are in the Court’s hand, of course.
FRENCH CJ: I think you should just integrate that argument as though on an appeal with the rest of your ‑ ‑ ‑
MR CATTERNS: Thank you, your Honour. That would mean we would deal with the question of manner of manufacture first and then make the application for leave and attempt to integrate it, as your Honour suggests, with respect.
FRENCH CJ: Yes.
MR CATTERNS: Your Honours, in our submission, the fundamental question on the appeal is, as the Court said in the National Research Development Corporation Case, the NRDC Case, of course, is the invention in suit of manner of manufacture within “the established ambit” – that is one of the phrases their Honours used – of section 6 of the Statute of Monopolies that their Honours expressed the right test as a proper subject of letters patent according to the principles which have been developed for the application of section 6. On the same page their Honours refer to the “breadth of the concept which the law has developed” for the grant of monopolies.
Your Honours, our submission is that in 1959 in the NRDC Case obiter, the Court recognised that methods of medical treatment of humans were excluded from the established ambit of section 6 and in 1972 his Honour Chief Justice Barwick in Joos v Commissioner Case acknowledged the exclusion multiple times, drew a distinction between methods of medical treatment and cosmetic processes, by the way having no trouble in distinguishing between them but, nevertheless, we submit, recognised the exclusion.
So, your Honours, our submission is that as at 1990 when the Act was enacted very deliberately intending to invoke a line of Australian authorities and UK authorities, and expressly so, the methods of medical treatment of humans were outside the established ambit of what is a manner of manufacture. Your Honours, we will attempt to show that the obiter decisions of the two Full Courts of the Federal Court in the Rescare Case and the Bristol‑Myers Squibb Case were in error.
Each of those cases of course their ratio is novelty, the patents were not novel in either case and what we want to submit is that part of the source of the error in those two decisions, to use his Honour Justice Wilcox’s phrase, is that the NRDC Case swept away the rationale for the exclusion that we submit had been articulated in the NRDC Case, citing Maeder v Busch, particularly Justice Dixon’s decision in that case, and the Re C & W Case, which we will take to the Court to, of the Solicitor‑General in England in 1914, I think.
FRENCH CJ: Mr Catterns, you say at, I think, paragraph 30 of your submissions that you do not formally abandon the point in relation to general inconvenience and there are arguments which appear later in your submissions, and I am looking particularly to those focusing on physician’s purpose and that kind of judgment, which seem to me to be hard to disentangle from notions of general inconvenience. Now, against you it is put that there is some evidentiary implication of any reliance upon that ‑ ‑ ‑
MR CATTERNS: Your Honour, we deleted from our pleading an argument on generally inconvenient and so our argument does not depend on generally inconvenient. Indeed, our submission is that the Full Courts erred in holding that NRDC, having swept away the idea that methods of treatment were not manners of manufacture, the only ground left standing was generally inconvenient. We respectfully submit that is wrong. To put it shortly, your Honour ‑ ‑ ‑
CRENNAN J: You are not relying on Justice Sheppard’s dissent?
MR CATTERNS: No, your Honour, for two principal reasons, your Honour. First, we do not think - we submit that it did not, travel. The various provisos in section 6 of the Statute of Monopolies including injurious to trade by raising prices of commodities at home and so on, we submit they did not travel, in effect, as a stand‑alone objection to the grant.
CRENNAN J: How do you articulate the NRDC exclusion, the rationale for it?
MR CATTERNS: Your Honour, medicine has always been patentable since – for hundreds of years. We know the phrase “patent medicine”, but a method of treatment of human beings is not patentable because something that has – whose effect is, on a human being, is not within the whole concept as it was thought of in 1623 and as has been developed ever since.
CRENNAN J: Is this because it cannot be industrialised? Is that the idea?
MR CATTERNS: Yes, your Honour, because we are not commodities. An improvement, as Sir Stanley Buckmaster said, in my condition is not a commercial thing. It is a very narrow exception to the prohibition on monopolies – I am sorry, the ability to grant a letters patent for a manner of new manufacture is a very confined exception, intended in those days to promote trade, the importation of trades from abroad, in particular. Your Honour remembers that you could be an inventor if you merely brought it in from France or Germany.
So, your Honour, it is a very narrow exception. The initial term of seven or 14 years was a multiple of the term of an apprentice. It is an area of discourse excluded from the ordinary prohibition on manufacturers in which area of discourse - an improvement in the medical state of a human being does not fit. We submit that is pretty clearly the way Sir Owen Dixon viewed it in the Maeder v Busch Case which is the source of the two dicta, a couple of sentences in the NRDC Case.
It is important in the NRDC Case, your Honour, because the - as I will attempt to show in a minute – their Honours were dealing with, first, the question whether the method of treating crops there with a herbicide was a manner of manufacture but there was positively put to the Court that within the established ambit of the concept of manner of manufacture agricultural processes were excluded and the Court said no, that is not right. So the very topic of what is inside and outside the scope at the same time on page 275 where their Honours are, as it were, reserving the exclusion, at page 278 they say there is no such exclusion for agriculture.
CRENNAN J: What about processes for curing animals? They are in, are they not?
MR CATTERNS: They are, your Honour, yes. Some of the English cases we see they say it can be granted if you amend to delete humans. The claim here does not actually confine itself to humans but we have all fought it on that basis, your Honour. Sometimes it says mammals and humans have been pulled out of that. So, your Honours, as we say, the improvement in the medical condition of a human being, and we submit contrary to fears expressed, for example, in the Rescare Case, it is easy to draw distinctions just as his Honour Chief Justice Barwick did in the Joos Case. He said cosmetic is here, I will confine medical treatment here - about 10 times his Honour says that.
CRENNAN J: Well, current understanding about skin cancer demonstrates the line is not perhaps as easy to draw as his Honour thought in those times.
MR CATTERNS: Yes, your Honour, it is striking where his Honour says Sir Owen Dixon drew a bad distinction. Sir Garfield himself draws a bad distinction I accept, your Honour, where he says putting sunscreen on – of course there are difficulties at the margin. At the far end, your Honours, lines have to be drawn. For example, in the United States, they have drawn a line saying surgery does not infringe in fact, and recently the Supreme Court has said, in the Mayo v Prometheus Case, which I have given a reference to, that methods of diagnosis or at least that particular method of diagnosis was not patentable. So, of course, they are questions of judgment but as your Honour well knows they come up all the time in this and other areas of law.
GAGELER J: Now, you seem to rely upon the judgment of Chief Justice Barwick in Joos, but at the same time you reject part of the reasoning in that case.
MR CATTERNS: Yes, your Honour. We rely on his Honour’s recognition of it continuing, of the exclusion continuing, and face the fact that his Honour perhaps reluctantly does so, but his Honour says so multiple times. The reason we rely on that is that is the position as at 1990, subject to the question of a practice of the Commissioner which may I come back to. But, your Honour, the aspect of his Honour’s reasoning which of course I will come to in a minute that we do respectfully disagree with is where his Honour treated the NRDC Case as sweeping. His words were not “sweep away” but undermining Sir Owen Dixon’s “assumption”, as he called it, in the Maeder v Busch Case about the economic character.
Our submission on that is when the Court – there is also a slip of the pen by his Honour which I draw attention to but do not make much of. The Court expressly in their dicta in the NRDC Case said, in effect, perhaps the basis of the exclusion is that these medical treatments are essentially non‑economic. Footnoting Maeder v Busch back in 1938, of course his Honour Justice Dixon recognised that medicine is a field of – there is commercial interest involved in it and his Honour expressly says so while saying at the same time methods of treatment are not patentable because the entity – he said it must produce an effect upon some entity and human beings are not entities in that sense. So what we criticise is Chief Justice Barwick’s saying that Justice Dixon’s reasoning was undercut, in effect, by NRDC.
GAGELER J: But there is another aspect of the reasoning at page 623 of 126 CLR, and that is his pegging of the therapeutic medical process exception to what he saw as a rule of public policy, number one, and then, two, link to the words “generally inconvenient”. Now, you reject all of that?
MR CATTERNS: Yes, your Honour, with respect. His Honour Justice Gummow at first instance in Rescare proceeded on that basis, so too did the New Zealand courts, and then the Full Court in Rescare and it is the only issue in the Full Court in Bristol‑Myers Squibb, but, your Honour, the reason his Honour places the exception on the basis of public policy as being generally inconvenient is because his Honour, wrongly, we say, thought that NRDC swept away Justice Dixon’s reasoning. We say it is inconceivable that in the NRDC Case, having drawn attention to the exclusion twice, and then two pages later swept it away, that is not the right way, we submit, to read the NRDC Case.
So, your Honour, we submit that his Honour Chief Justice Barwick at 623 says what he says there because of what he said earlier about Justice Dixon’s reasoning being swept away. May I draw attention to it while we are there if it is convenient to your Honours? At page 617 in 126 CLR his Honour, in the second‑last paragraph, about two‑thirds of the way down the page, says:
Passages from this Court’s decision in Maeder v Busch –
Remembering that that case too, was a case about hair treatment –
were cited to me as . . . tending to establish that it is not possible to regard a process for treating human hair growing on the head as a manner of manufacture or, to use the expression of this Court in the N.R.D.C. Case, as a proper subject for the grant of a monopoly under the Act . . . What is there written is clearly obiter and was unnecessary to the decision of the case.
That is, of course, right. Then his Honour says, and this is the point I am attempting to get to, your Honours:
further, Sir Owen Dixon there accepted the view that it was necessary, in order to warrant a grant of letters patent, that a “substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence by means of or with the aid of the process”.
May I just pause for a second? Of course we accept that the Court in the NRDC Case broadened the idea of vendible product, a 1795 idea, or an expression used in 1795 in Boulton v Bull, to include any artificial effect of economic utility but there, your Honours, their Honours were, in effect, prescribing a minimum, that is something that is necessary for there to be a manner of manufacture. It is not necessarily sufficient - a book, Darcy’s playing cards from the Case of Monopolies and so on.
But that is the question where we submit his Honour erred. His Honour treated the passage in NRDC where their Honours say we treat vendible product as meaning – “vendible” meaning anything of economic utility; “product” meaning any artificial effect and that includes oscillations on a screen and so on - your Honour, the question is did that sweep away the reasoning that no substance or thing forming a possible subject of commerce is brought into existence or altered when it is a human being? We submit that when one reads what Justice Dixon says about that in Maeder, that is what he is saying. When his Honour interpolates at the end of a quote from Chief Justice Eyre, but it has to be, in effect, upon some entity, it is clear he is saying not a human being. May I just continue to the ‑ ‑ ‑
GAGELER J: Was Joos correctly decided?
MR CATTERNS: Yes, your Honour, we have no trouble with that, with respect, no trouble conceding that.
GAGELER J: So you need a narrower proposition, do you not, one that looks at therapeutic processes as distinct from what?
MR CATTERNS: Yes, your Honour, and I need to correct a sentence in our written outline by adding on a limitation - that is our paragraph 2, the one that the Court received this morning. We accept, as it were, the confinement by his Honour the Chief Justice in our paragraph 2: “When the Patents Act 1990 (Cth) was enacted, “a mere process or method for the medical treatment or manipulation”. Of course, today’s case is not cosmetic but it causes us no difficulty, with respect, we submit, for our argument. Pardon me, your Honour, may I just finish that point that your Honour Justice Gageler raised.
His Honour says at the bottom - and this is the passage that we think has been relied on as sweeping away or saying that NRDC swept away Justice Dixon’s reasoning - where his Honour says, after saying hair “undecided”, in the course of what was written at the pages certain assumptions were made. It is very questionable whether they are wholly sustainable since the decision in the later case. Your Honours, that is the NRDC Case and his Honour says part at least of the premises on which the observations were made was that surgery or other processes for treating the human body were, of their nature, essentially non‑economic.
His Honour answers that in a passage, with respect, if I may be silly, reminds me of Fritz Lang’s Metropolis where his Honour refers to in a very economic…..way to the national economic interest in the repair and rehabilitation of members of the workforce. That is not what Justice Dixon is talking about. His Honour is – of course, the fields of the practice of medicine and the sale of drugs are vast industries now, one of the most important industries in any country but that is not what his Honour meant by non‑economic. Your Honours, when his Honour says - Justice Barwick quoting that:
Part at least of the premises on which the observations were made –
his Honour is talking about Maeder -
was that surgery or other processes for treating the human body were of their nature essentially non‑economic.
Your Honour, that phrase is in fact used in the NRDC Case. I do not want to make too much of this - this is the slip of the pen I mentioned – but the point is that in the NRDC Case their Honours did, again, the very case that is supposed to have swept it away, treat them as non‑economic so their Honours must have meant something different from what his Honour is referring to in the subsequent couple of sentences about the “repair and rehabilitation” of the workforce. That is the contradiction.
We respectfully submit that in subsequent courts adopting that idea, namely, that the premises have gone away – I will show your Honours where his Honour says that – that the subsequent cases that have based themselves on that premise are wrong.
CRENNAN J: So what are you saying, Mr Catterns? Are you saying that when the expression “non‑economic” is used it does not mean not capable of being commercialised, it means something different. It means something like, does it, should not be industrialised?
MR CATTERNS: Or should not be regarded as it being industrialised, yes, your Honour. I think it should not be regarded as being within this confined area of discourse.
CRENNAN J: This is despite the obvious commercialisation of a method of treating human disease?
MR CATTERNS: A medicine. Yes, your Honour.
CRENNAN J: So you have the compound is patentable but not the method?
MR CATTERNS: Of course, your Honour. Exactly, your Honour. Your Honour, a medicine is an archetypal manner of manufacture that has been regarded as patentable for centuries. In the R v Wheeler Case the judge says a medicine, a stove, a telescope as examples of what are patentable but something that improves the repair and rehabilitation of a human is not.
FRENCH CJ: Is there some formulation, if you like, of a normative principle that underpins this approach, underpinning the exclusion?
MR CATTERNS: Yes, your Honour. The first premise is that we have an unusual legislative drafting approach which is to invoke section 6 of the Statute of Monopolies and thereby, as the Court explained in NRDC, to invoke the established ambit of concept. So in a sense the first step is that that established ambit has never included methods of treatment subject to the dicta in the two Full Courts, here and in many other places.
Your Honour, the reasoning that underlies that was summarised by the Full Courts, in NRDC’s phrase, “essentially non‑economic”, but if I may go back, your Honour, to page 617, still in Joos Case, your Honour saw the little passage about eight lines from the bottom, you need a:
“substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence –
and might I say improved –
by means of or with the aid of the process”.
So, your Honour, when the thing is a person – that is my principle – when the thing is a person it is not within this area of discourse, assuming there is a discourse.
FRENCH CJ: That is the normative principle, is it?
MR CATTERNS: Yes, your Honour.
CRENNAN J: How would that play out in terms of the Rescare decision in relation to the method, this articulation of principle?
MR CATTERNS: Well, your Honour, it may be possible to distinguish Rescare but, your Honour, the method in Rescare was ‑ ‑ ‑
CRENNAN J: Well, that is what I am wondering. Is it an all or nothing principle? Are there any distinctions to be made between one sort of method and another method?
MR CATTERNS: Well, I suppose, your Honour, it is very difficult to distinguish between the Rescare, which your Honour would remember was the application of slight positive pressure to the nostrils to stop sleep apnoea - it kept your pharynx open, Professor Sullivan called it a splint of air – it is hard to distinguish between that and the process for removing lead from the body of the Re C & W Case ‑ ‑ ‑
KIEFEL J: What is the method here then, Mr Catterns?
MR CATTERNS: Well, your Honour, the method here – perhaps I should show you – take your Honour to the claim. It is in volume 1. The patent begins at page 411. Page 411 is just the publication details that tell us that the filing date was 29 March 1994 with a priority of 31 March. If I can just take the Court quickly to 414 where in the specification the patentee acknowledges the prior medical uses of the compound? So, your Honour, the compound is what we see at line 6, “N‑(4‑trifluoromethylphenyl)” et cetera – that is leflunomide – and there is a reference to “European Patent 13,376”. That was the equivalent to what was in suit on the novelty part of the case, the 341 patent which I will perhaps take the Court to a little later if I may. The claim, your Honours, is at 427. A method – it is for – this is only a single claim after amendment:
A method of preventing or treating a skin disorder, wherein the skin disorder is psoriasis –
That slightly strange locution is because it was amended to narrow it to a single skin disorder –
which comprises administering to a recipient an effective amount of a pharmaceutical composition containing as an active ingredient –
leflunomide. Now, your Honours, just while I am there, the Full Court read “A method of preventing a treating a skin disorder” as whose purpose is the prevention or treatment of psoriasis. Her Honour Justice Jagot held it meant, if it in fact, our shorthand is, the effect in fact is to treat psoriasis and that is perhaps important also on the infringement side of the case. But answering your Honour’s question, her Honour said that the use was, for the purpose of section 117, oral administration to treat disease.
KIEFEL J: With dosage, so it is compound and dosage.
MR CATTERNS: Yes, your Honour, but the dosage is not specified, an effective amount. Your Honour, this points up what is wrong with the method of treatment because if her Honour Justice Jagot’s construction were right, but that is being rejected, what you are claiming in terms of partly answering his Honour the Chief Justice’s question, the thing that ought not to be within the concept is the effect on a human being that her psoriasis is improved or you are claiming some mixture of it where it is the intention of the physician to administer this drug to cure the person of psoriasis, and that is way outside the territory of what is a manner of manufacture.
Of course his Honour Justice Dixon in the Maeder v Busch Case said, and the Full Court picked it up again in the NRDC Case, that this is a growing concept. We accept that. But this is outside the whole type - either way of reading this claim takes it outside the type of things that is a manner of manufacture. Your Honours, I am sorry, if I may just go back quickly to the last little part we were at in the Joos Case at 618, at the middle of the page his Honour drew the distinction between – which his Honour said was:
radical between a process for treating the diseases of the body –
which his Honour accepted were excluded –
and a process for improving the cosmetic appearance –
Then there is the criticism of his Honour Justice Dixon’s distinction between a face lift and an abdominal operation. Fair enough, your Honours, but may I go down a little further where his Honour says:
These differences are not merely in degree but, in my opinion, in kind. Thus, to my mind, the views tentatively expressed in Maeder v. Busch are much weakened if the assumptions are disclaimed –
and this is important -
one of them is now seen to be clearly wrong according to the Court’s own decision, there being no need for a vendible or improved vendible product, and the others more than doubtful –
So, your Honours, then his Honour of course notices the references -
in the N.R.D.C. Case to Maeder v. Busch and to the treatment of disease of the human body. But that was no more than a passing reference not intended to be definitive.
Your Honour, his Honour many times, but may I weary your Honours with only two, on page 16 - so his Honour drew the distinction - cosmetics are within the concept, and page 619, line 6:
For the purpose of deciding this question it may be granted that a process for the treatment of the human body as a means of curing or preventing a disease . . . is not a proper subject matter for the grant of a monopoly under the Act.
That is the established ambit, your Honours. It is not essential to his Honour’s decision to controvert it or discover and express his basis in law, although his Honour did later in the passage his Honour Justice Gageler drew to my attention.
But I think it is significant that the concession is limited to the medical treatment of disease, malfunction or incapacity.
Then there is the antithesis that her Honour Justice Crennan drew to my attention between sunburn about which we are all, of course, vastly more careful now. But then his Honour goes on:
To be treatment, in the relevant sense, it seems to me that the purpose of the application to the body whether of a substance or a process must be the arrest or cure of a disease or diseased condition . . . With that sense of “treatment”, I see no difficulty in conceding, for the purpose of the decision of this case, that a process for the medical treatment of a part of the human body is not a proper subject of letters patent.
We submit that was the state of the law in 1990 when the Industrial Property Advisory Committee recommended that we continue to use section 6 as our definition of “invention”, and when the explanatory memorandum says this provision invokes a long line of UK and Australian decisions.
Just finally, your Honour, to save coming back here, to remind your Honours what we submit is significant in relation to the practice of the Commissioner, which is that the practice of the Commissioner is that she must grant a patent unless it is plainly bad, unless it is clear that no valid patent can be granted. His Honour says that at page 615 in the second‑last paragraph, two‑thirds down, where his Honour says:
It is important at the outset to state the function of the Tribunal –
His Honour was sitting as the Tribunal on an appeal from the Commissioner, which is exercising the same functions as the Commissioner –
The question for the Tribunal is whether what is claimed could be regarded as a proper subject matter for the grant of letters patent within the terms and the limits of the Statute of Monopolies as made relevant by the definition of “invention” in s. 6 and by s. 35 of the [1952] Act. It is quite clear on the authorities that the Commissioner ought only to refuse to proceed with an application if on no reasonable ground could what it claims be said to be within the Statute.
So, your Honours, following that - and his Honour Justice Gummow quotes it in the Rescare Case at first instance - the Commissioner adopted a practice of granting patents for methods of treatment. We face up to that. The present case is an example, of course. One last point on that, not only is that when it is – you cannot say that is not an invention that the – only in the case where the Commissioner can say with certainty it is not an invention should she stop it at that stage and the Microcell Case 102 CLR says the same thing and that is well settled. That has been slightly amended since but not in a way that is relevant, your Honours.
But, importantly, and this is said in the last of the line of English cases before their Act was amended in 1977, in the Upjohn Case that there is a reference to here and I was going to take the Court to very quickly, one of the arguments that was run there was you should let this through because the principle is you stop them only if it is clear that no valid patent can be granted and the court said the principle is so certain, the Court of Appeal in that case, said the principle is so certain that this application must be refused.
So, your Honours, there is a symmetry which we submit assists us. To say that it is not a proper subject and to refuse it, as occurred in the Kay Cases, given the test or the standard that the Commissioner applies gives it greater force. Your Honours, if it is convenient, I was going to go now to the – first, just a couple of provisions of the Act just to remind your Honours what we have got and then I was going to go to NRDC.
I am not sure if your Honours have our little bundle or print of the Act. There is no relevant – from our point of view, I do not think there is any relevant difference but our friends might wish to rely on – I think, do wish to rely on some more recent sections so that what version they have will become important. It is in the bundle of materials we gave the Court. Your Honours, section 18, which is in tab 4 of the bundle that your Honours are using now, says – it defines what is a patentable invention as an:
invention for the purposes of a standard patent if the invention, so far as claimed in any claim:
(a)is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies -
and, your Honour, may I just draw attention to the fact that a number of the subsequent provisions which your Honours know - novelty, inventive step, utility - they are, we submit, the modern embodiment of the generally inconvenient ground. For example, a patent that was not useful was generally inconvenient. The provisos that followed the permission to grant letters patent for manner of new manufacture which others shall not use - well, that is novelty and that is here. So obviousness was not really, forgive the phrase, invented until the 19th century. Then if I could take your Honours to the definitions in Schedule 1 - it is tab 11 in the bundle - the definition of “invention” - it is at page 165 of this print:
means any manner of new manufacture the subject of letters patent and grant of privilege within section 6 of the Statue of Monopolies, and includes an alleged invention.
The Statute of Monopolies is, as it were, identified, under “S”, of course:
Statute of Monopolies means the Imperial Act known as The Statute of Monopolies.
Finally, it is a ground of revocation under section 138 - tab 10 - section 138(3)(b):
that the invention is not a patentable invention –
We say because this is not a manner of manufacture within section 6 it is not a patentable invention and thereby liable to revocation. Your Honours, the NRDC Case 102 CLR 252, I think the NRDC, National Research Development Corporation, was a UK equivalent of the CSIRO. Your Honours, I will not take time, but the argument is well worth reading, with respect, including the argument of Mr Aickin, as his Honour was. Your Honours, if I could go to page 261, there we see the claims at the top of the page:
A method for eradicating weeds from crop areas containing a growing crop selected from leguminous fodder crops –
The next claim has lucerne, and the next claim has clover –
which comprises applying to the crop areas a herbicide of the class consisting of –
and then the compounds are given, their salts, et cetera. So they were the claims. Now, your Honours, just to remind your Honours of the structure of the reasoning, their Honours at the bottom of page 261 refer to two aspects of this ground of manner of manufacture. The first one is the one in Commissioner of Patents v Microcell. It shows that:
the word “alleged” goes only to the epithet “new” . . . and that accordingly the Commissioner may properly reject a claim for a process which is not within the concept of a “manufacture”.
That is what is explained principally in this judgment.
But the case cited shows also that even if the process is within the concept the Commissioner is not bound to accept the allegation of the applicant that it is new, if it is apparent on the face of the specification, when properly construed, that the allegation is unfounded –
The jargon is:
“nothing but a claim for a new use of an old substance”.
Your Honours remember that this Court considered that concept, the mere new use type concept, in the Philips v Mirabella Case and also Advanced Building Systems v Ramset, not presently relevant here. We ran it at first instance unsuccessfully and did not appeal on it.
FRENCH CJ: Incidentally, do you say that the general inconvenience proviso was also excluded under the 1952 Act?
MR CATTERNS: Probably, your Honour, on the same reasoning. Their Honours do not mention it in their admittedly terse passages that I am going to come to. Your Honour, at the bottom of 262, in discussing what can be more than a mere new use of an old substance, their Honours deal with that, namely, in mentioning:
the suggestion that the substance may be used to serve the new purpose ; and then, provided that a practical method of so using it is disclosed –
Then importantly –
and that the process comes within the concept of patent law ultimately traceable to the use in the Statute of Monopolies of the words “manner of manufacture” –
Then their Honours dealt with that first over the next few pages and may I skip over that. Your Honour, that goes to 268 where their Honours say, after referring to the specification in detail, in short it is not a mere “new use of an old” thing. That is the end of the paragraph that ends:
The fact that the substances themselves were already known to man affords no valid reason for denying that the suggestion was inventive.
So, your Honours, we put that aside, with respect. Then:
The central question in the case remains. It is whether the process that is claimed falls within the category of inventions to which, by definition, the application of the Patents Act is confined -
the confined exception to the prohibition on monopolies and their Honours remind us that it -
is exclusive ; invention means any manner of new manufacture the subject of letters patent and grant of privilege within s. 6 –
The Commissioner did two things, your Honours, first of all contended:
for an interpretation of it which, though not narrow, is restricted to vendible products and processes for their production –
and the bulk of the Court’s reasoning up to page 277 - a famous passage about “an artificial effect” of economic utility answers that. That is the restriction, but there is also propounded, as I submitted earlier, an exclusion of agricultural and horticultural processes, in other words something that by its nature was excluded from the ambit of the statute and their Honours rejected that while at the same time, twice, allowing the possibility, at least, of the exclusion for which we contend. Your Honours see that their Honour say:
On the grounds both of the suggested restriction –
which their Honours deal with first –
and of the suggested exclusion [the Commissioner] denies that a process for killing weeds can be within the relevant concept of invention.
The appellant argued whenever a process produces either immediately or ultimately a useful physical result in a “material or tangible entity” – that was Mr Aickin’s submission and that was what was accepted, but at the same time the courts maintained in, I admit, brief obiter, the exclusion that we are referring to. So, your Honours, their Honours quote section 6 at the bottom of page 268, and your Honours can see the various provisos:
hereafter to be made of the sole working or makinge of any manner of new manufactures within this realme, to the true and first inventor and inventors –
one proviso –
which others at the tyme of making such letters patents and graunts shall not use –
That is novelty –
soe as alsoe they be not contrary to the lawe or mischievous to the state by raisinge prices of comodities at home, or hurt of trade, or generallie inconvenient” –
We cannot see how general inconvenient travels but “hurt of trade” does not, and we do not have cases where we argue as if it was Part IV of the old Trade Practices Act, the economic pros and cons of the giving a grant of letters patent.
GAGELER J: Is not the thrust of the reasoning at page 269 that the totality of section 6 expresses what at least by that time had come to be seen as a single concept, and is not the joint judgment at about point 8 at page 269 saying it is an error to ask is this a manner of manufacture?
MR CATTERNS: If it means is this a kind of manufacture, just confining yourself to the world of manufacture, the dictionary definition – that is what their Honours are saying, your Honour – and their Honours go on to say what the right question is, because we do not just look necessarily to tangible goods by hand or machine, always remembering that what their Honours are going to deal with is an improved pasture because it is weed free so that the lucerne can grow better, so their Honours are going to not confine themselves to hand or machine and they posit the right question, is this a proper subject of letters patent according to the principles which have been developed for the application of section 6. Your Honour, it may well be, of course, that in developing those principles the courts took into account those various provisos, but what we eschew here is any separate ground, as it were, of generally inconvenient.
FRENCH CJ: One wonders what is embodied in the words “proper and appropriate use” by Chief Justice Barwick in Joos.
MR CATTERNS: Well, yes, your Honour. Their Honours use “proper” here, as your Honour sees. Your Honour, may I suggest that the three preceding articulations help us level with “Commissioner of Patents” about 15 lines down:
the Patents Act . . . defines the word “invention”, not by direct explication and in the language of its own day, nor yet by carrying forward the usage of the period –
So we of course accept it is a developing concept –
but by reference to the established ambit of s. 6 of that Statute.
That is our shorthand for the four ways their Honours articulated here:
The inquiry which the definition demands is an inquiry into the scope of the permissible subject matter of letters patent and grants of privilege . . . not into the meaning of a word so much –
Partly answering your Honour Justice Gageler –
as into the breadth of the concept which the law has developed by its consideration of the text and purpose of the Statute of Monopolies.
I think I can skip, your Honours:
The word “manufacture” finds a place in the present Act, not as a word intended to reduce a question of patentability to a question of verbal interpretation, but simply as the general title found in the Statute of Monopolies for the whole category under which all grants of patents which may be made in accordance with the developed principles of patent law are to be subsumed.
Therefore it is the wrong question to ask:
“Is this a manner (or kind) of manufacture”.
Their Honours set out the right question. So, your Honours, we submit that – perhaps I hesitated when his Honour the Chief Justice asked me what the normative basis of this is, but the basis is, in a way, the way their Honours put it out here, it is just these kinds of alleged inventions do not fall within the concept and I cannot do better in articulating it than Justice Dixon did in the Maeder v Busch Case, as his Honour then was. I will take your Honours to that next if I may.
But, your Honours, just at 270 to the first of our two dicta that we rely on so heavily as your Honours know, they notice, of course, that there is a “widening conception of the notion” of manner of manufacture. That is at the top of the page, which his Honour Justice Dixon had said in Maeder v Busch. “As early as 1795”, and then there is quotation from Chief Justice Eyre in Boulton v Bull, which is one of the cases about James Watts’ steam engine or fire engine as they called it. Without quoting that, your Honours, then when we see the citation, Boulton v Bull, with the footnote (2), Justice Dixon, as his Honour was, had quoted it earlier in Maeder but then his Honour added these words, your Honours, which your Honours will see in Maeder:
But the ultimate end in view –
his own words –
is the production or treatment of, or effect upon, some entity.
It is clear from what follows from his Honour that a human being is not an entity in that sense. So, your Honours, then it is made clear that manufacture includes processes as well as products. Your Honour, then importantly, down at about point 6, Chief Justice Abbot in R v Wheeler:
having spoken of a “thing made, which is useful for its own sake, and vendible as such” –
So, your Honour, that is partly the source of the – no, I beg your pardon, Justice Heath earlier in Boulton v Bull up at footnote (4) is the source of “vendible product”, says:
went on to show that he did not find in such expressions as those any absolute test.
So, your Honours, it is clear that their Honours are in the very area of “vendible product” and about to say it is all too narrow, nevertheless say, after quoting Justice Abbott:
something that can be made by man from the matters subjected to his and art and skill, or at the least some new mode of employing practically his art and skill is requisite to satisfy this word”. It is of course not possible to treat such a statement as conclusive of the question. The need for qualification must be confessed, even if only in order to put aside, as they apparently must be put aside, processes for treating diseases of the human body –
The Re C & W Case is cited and Maeder v Busch at footnote (10) is the whole case. So, your Honours, of course, know that is important, one of the two dicta we rely on. At the top of 271, counsel:
Sir George Ligertwood made a helpful suggestion which in effect amended the statement of Abbott C.J. to read “ . . . or at least some new method of employing practically the art and skill of the workman in a manual art”.
Then, your Honours, I can perhaps get – their Honours are talking about, again:
The truth is that any attempt to state the ambit of s. 6 . . . is bound to fail.
So it is in the very context where their Honours are saying, or at least acknowledging, an apparent exclusion of methods of medical treatment that their Honours are talking about the ambit of the concept. Your Honours, then there is a long discussion which we do not need to take time over ‑ ‑ ‑
FRENCH CJ: But that is an ambit, that is a concept bounded by public policy considerations tied up in the notion of general inconvenience, is it not?
MR CATTERNS: I think I submit, not, your Honour. Of course, if one says we are human beings and it is not – an improvement in my condition is not patentable, on one view that is a policy submission, I accept, your Honour, but it is also to say it is not within the concept. These are limited exceptions to the grants – the prohibition on monopolies and these are not within that concept. So, not purely as a ‑ ‑ ‑
CRENNAN J: Not within that concept by custom or not within that concept in a semantic sense? You see, it is said the need for qualification must be confessed if only in order to put aside as they apparently must be put aside processes for treating diseases of the human body. There is no extraction in a semantic sense of that category from a new manufacture, is there?
MR CATTERNS: I submit their Honours are putting it aside and their Honours do again in a couple of pages. It is pretty clear ‑ ‑ ‑
CRENNAN J: For if they are it is purely public policy, as the Chief Justice says, is it not?
MR CATTERNS: No, your Honour, it is because, as they suggest in the next dictum, that they are essentially non‑economic. They are not in this universal discourse and that is what all those – I will not go back to them – that is what all those passages are on page 269. The established ambit is something more than custom, your Honour, it is what is the proper subject matter as it has been explained and developed for hundreds of years, nearly 400 years. That is what their Honours are, in a short way, invoking.
Your Honours, it is not – I readily accept his Honour the Chief Justice’s – admonition is not the right phrase, but one needs to be clear, of course there are elements of policy involved, I am certain, and there always have been and when I take your Honours to Justice Dixon’s reasoning in Maeder dicta, I cannot do any better than his Honour. Of course, in a sense policy underlines it and that policy is not that it is generally inconvenient but that human beings are not products of manufacture. I will not repeat that too many more times, your Honours.
CRENNAN J: But neither are animals. This is all a subset of the argument that processes are included under section 6 of the Statute of Monopolies.
MR CATTERNS: Yes, your Honour, but that ‑ ‑ ‑
CRENNAN J: There is an exclusion of a particular process, but not all processes, without any distinction between them.
MR CATTERNS: Well, your Honour, the distinction that the Solicitor‑General, Sir Stanley Buckmaster, made in the Re C & W Case is animals are vendible, we are not; that is what he says. Now, I can call that policy but I also say that is why this established ambit ‑ ‑ ‑
CRENNAN J: Well, more problematic, I suppose, is that distinction induced between cosmetics and treatments where by the time you get to Justice Gummow in Rescare you cannot detect any normative principle which would allow you to make that distinction.
MR CATTERNS: Yes, your Honour, and I do not find attractive earlier cases that said the hair is dead after it has left the scalp.
CRENNAN J: I would still like to know at some point – not necessarily now – how your argument does translate in relation to the findings in Rescare on method. Are you saying they are wrong?
MR CATTERNS: I am saying the reasoning is wrong, your Honour.
CRENNAN J: Are you saying the reasoning needs to be rejected now?
MR CATTERNS: Yes, your Honour.
CRENNAN J: That is because it turns on general inconvenience, is it?
MR CATTERNS: Yes, your Honour, and because their Honours wrongly thought that this case here, the NRDC Case, swept away the very dicta I rely on. So their Honours say that what we are about to arrive at, at page 277, swept away these dicta which themselves go back to Maeder v Busch and Re C & W. I say Rescare is wrongly decided. I thought your Honour was also drawing a distinction between the particular method in that case which was a physical device – use of a physical device.
CRENNAN J: Well, there is that distinction as well.
MR CATTERNS: Yes, but we ‑ ‑ ‑
CRENNAN J: Notwithstanding that you say the reasoning is wrong and reaches the wrong result?
MR CATTERNS: Yes, your Honour. Frankly, your Honour, if I could so nicely put Rescare aside with that distinction – I wish I had thought of it – but we do not think there is any – we have not so far thought there was any distinction in principle. We have to face up to submitting that Rescare is wrong and these dicta are right.
HAYNE J: How do you say we form that judgment other than by reference to antiquity? Your argument seems to be well, these dicta were uttered first. I follow the course of authority. You deny there is a sweeping away, therefore – is that the way the argument runs?
MR CATTERNS: Perhaps this oversimplifies it slightly, with respect, your Honour, but it does because we see at page 269 ‑ is this the proper subject of letter patents, letters patent, in light of the way the principles have developed? Then, your Honours, we have to face up to the two later sets of dicta and then it is a question of which dicta the Court finds more persuasive.
HAYNE J: But your argument hinges upon the notion of proper subject of a patent, does it not?
MR CATTERNS: Yes, of course, your Honour.
HAYNE J: Is not that what we have to grapple with?
MR CATTERNS: Yes, your Honour.
HAYNE J: Yes, you say light is shed upon that by the existence of the dicta, the course of authority.
MR CATTERNS: Yes.
HAYNE J: But is that all we have to go by?
MR CATTERNS: Well, your Honour, this is not a case where we, for example, engage in a, we submit, engage in an analysis of the encouragement to innovate a second or third or fourth medical use and the balancing considerations between what is now very strong government policy on encouraging generic competition, et cetera. That cannot be. That is a matter for Parliament, with respect, so the question is, is this is a proper subject of letters patent in light of the way it is been looked at and we submit your Honours should be persuaded that the two later cases do not, as a matter of cogency of reasoning and understanding of the history, overcome the earlier dicta, the dicta in both cases.
CRENNAN J: Will this not mean in terms of modern biotechnology that there will be the ability for a pharmaceutical company, for argument’s sake, to get a monopoly in relation to a particular compound for a particular use but once the compound is known and a new use is discovered, which will treat a disease, on your argument that would fall outside patentable subject matter?
MR CATTERNS: Yes.
CRENNAN J: That is to say a new use of a known compound?
MR CATTERNS: If that new use is a method of medical treatment.
CRENNAN J: Yes, if it is a method. I always meant to imply that it was a method.
MR CATTERNS: Yes, your Honour, and that is the case in the United Kingdom, as it always has been, first of all by ‑ ‑ ‑
CRENNAN J: By statute.
MR CATTERNS: First of all by judicial ‑ ‑ ‑
CRENNAN J: By C & W and – yes.
MR CATTERNS: Right at the very end, the Upjohn Case, now expressly by statute. The same in Europe, these are now expressly included by statute. In Canada the courts have held that they are excluded. In Europe there was a way of dealing with it which was Swiss claims for a while which gave – and New Zealand still adheres to the granting of Swiss claims but ‑ ‑ ‑
CRENNAN J: What about Europe in relation to some variation of Swiss claims?
MR CATTERNS: They have now banned them, but we give a reference to the Abbott Case where the Enlarged Board of Appeal which is, as your Honour knows, the Supreme Court of the Patent Office, they say, well that praetorian device which…..Swiss pharmaceutical industry no longer works because they now have in the convention, and the equivalent is section 4A of the English Act, a deemed novelty for a product, your Honour.
CRENNAN J: This is Article 54?
MR CATTERNS: I beg your pardon, your Honour?
CRENNAN J: Do you know where that is to be found?
MR CATTERNS: Yes, your Honour, Article 54.
CRENNAN J: Article 54, yes.
MR CATTERNS: Yes, and section 4A, they are in our bundle, and section 4A of the UK Act. So, your Honour, they do not grant methods for medical treatment, they expressly exclude them.
CRENNAN J: Then the way around it for a new use of a known compound.
MR CATTERNS: Yes. The difference is, your Honour – beg your pardon, I did not mean to interrupt you.
CRENNAN J: No, go on.
MR CATTERNS: But the difference is in Europe you can – and his Honour the Chief Justice will say this is a policy consideration, but in Europe you sue the manufacturer because there is no question that the doctor infringes. There is a deemed novelty of this product for the new use. How we deal with that is another question.
CRENNAN J: Deemed novelty for a new use instead of a Swiss claim.
MR CATTERNS: Yes, your Honour.
CRENNAN J: That is how it works, is it not?
MR CATTERNS: Yes, your Honour.
CRENNAN J: Then infringement through the supply route.
MR CATTERNS: Yes, your Honour. To coin his Honour Justice Hayne’s phrase, “instructed supply”, our section 117(2)(c) that your Honours considered in Collins. In the US, methods of treatment are patentable – I will take your Honours to it – there is a carve‑out for surgery.
FRENCH CJ: An unfortunate metaphor.
MR CATTERNS: I beg your pardon, your Honour.
HAYNE J: An unfortunate phrase.
MR CATTERNS: Carve‑out, I beg your pardon. Thank you, your Honours. There is an express exclusion for surgery - in effect a defence because an ophthalmologist – Dr Pallin – patented a method of removing cataracts stitchlessly. So obviously that is to an advantage. Then he sued his colleagues and they amended the Act very quickly to stop that. But just in terms of perhaps answering his Honour Justice Hayne’s question at the same time, it is not just a question of these earlier cases trumping the later cases. There is something that underlies the exclusion of methods of treatment in countries I have mentioned. In New Zealand the Court of Appeal, on the basis of generally inconvenient, to put it shortly, said these are excluded and it is a matter for the legislature to decide to bring them back in.
CRENNAN J: Well, the deemed novelty idea seems to recognise that there is something wrong with the exclusion in terms of rewarding some advance in biotechnology, for argument’s sake, which is beneficial to human kind.
MR CATTERNS: Your Honour, that is the premise, of course, as your Honour knows of patent. That is why the statute allowed this exception in 1623, that there is some benefit from introducing a new trade one way or the other, and that is a developing concept. But, your Honour, that is a legislative question and here the legislature has deliberately stuck with this 400‑year‑old concept, as explained by the High Court in NRDC and since.
HAYNE J: Let me understand it a little better than I do. You say of the passage in NRDC at 270 that processes for treating diseases of the human body are to be put aside. They are to be put aside on the basis that human beings are not articles of commerce. Is that right?
MR CATTERNS: Yes, your Honour, I get that from Maeder v Busch when I get there.
HAYNE J: Yes. Yet there is a market – we begin accepting there is no market for human beings, self‑evident, true. But there is a market for production of useful results in human beings, is there not?
MR CATTERNS: Your Honour, no doubt this is of economic utility.
HAYNE J: So what is the foundation that you offer for the proposition at 270? We see it there, we read it. We understand it. What is its foundation? I know you say it is enough it is there and the Act was enacted on that footing, but it does help I think if we understand why it was there.
MR CATTERNS: Yes, your Honour. Well, we say the foundation is, and there is a hint at page 275 where their Honours say “essentially non‑economic”. Would your Honour mind if I went to that second dictum?
HAYNE J: Whatever path you think best.
MR CATTERNS: No, I am grateful for your Honour’s help, of course. I mean it, too. At page 275, their Honours are still considering this question of vendible products and at about point 6 after referring to Justice Evershed, as his Lordship was, spoke of the expression “vendible product”. They are broadening the concept of “vendible product”:
as laying proper emphasis upon the trading or industrial character of the processes intended to be comprehended by the Acts – their “industrial or commercial or trading character” . . . The point is that a process, to fall within the limits of patentability which the context of the Statute of Monopolies has supplied –
That is their approach again and again, your Honours -
must be one that offers some advantage which is material, in the sense that the process belongs to a useful art as distinct from a fine art . . . that its value to the country is in the field of economic endeavour.
We are leading to their Honour’s ratio at 277, but their Honours put it aside again in a bracket, of course, and only in the sentence -
(The exclusion of methods of surgery and other processes for treating the human body may well lie outside the concept of invention because the whole subject is conceived as essentially non‑economic –
Of course, your Honour, we accept there is a big economic interest, as I submitted earlier, in medicine and in the sale of drugs but their Honours obviously had something else in mind and that is that if – picking up what her Honour Justice Kiefel asked me, looking at the claim – if, on her Honour the primary judge’s construction, the claim is we hereby claim the effect, in fact, that your psoriasis is improved, that is not – that is essentially non‑economic, or further, if it involves inquiry into the relationship between the doctor and the patient, it is outside the concept. To interfere with the doctor’s professional judgment is a different category of thing from that which is patentable.
GAGELER J: So your argument in part depends on a view taken of practices within the medical profession?
MR CATTERNS: Yes, your Honour, but I submit that is within the concept, not as a stand‑alone, generally inconvenient objection, as it were. Of course, those provisos have informed the content of the ambit for 400 years of what is patentable.
HAYNE J: But again do we not need, in this case, to grapple more particularly with the claim made here rather than deal with the matter at the level of abstraction at which your argument is presently pitched because I would understand you to say that a way of understanding the claim is to claim that we can apply a known product in a known way to cure a disease not previously treated in this way.
MR CATTERNS: Yes, your Honour.
HAYNE J: Now, whether that is how the claim should be understood may be one set of issues, but if it were to be understood in that way does that not present a much more pointed question than the general one of has the fact that we have gone past bleeding patients and prescribing natural aperients somehow defined reflection in patents law?
MR CATTERNS: The answer to your Honour’s question is yes. Of course, we must look at this particular claim which is paraphrased, as your Honour put it, I think, recognising that there were two possible constructions below.
CRENNAN J: Well, touching upon the idea that what you have is not so much an invention but a discovery of an unappreciated benefit.
MR CATTERNS: Well, that is true, your Honour, but I must confess we ‑ ‑ ‑
CRENNAN J: This, I suppose, is like your second medical use argument.
MR CATTERNS: Yes. We lost on novelty below, but there is no question that the specification says here is a known compound and it is used for inflammations, et cetera. We now have a new use, psoriasis, and, of course, the question is whether that is patentable. The question before the Court is not – is a process for permanent waving hair patentable, for example.
CRENNAN J: In any event, novelty is not in issue, it is this point about notwithstanding it might otherwise be patentable it is not patentable because it is a process for the treatment of human disease.
MR CATTERNS: Yes, your Honour, we lost on all the other grounds. Your Honours, the significance of the dictum, its part in the judgment is – remembering where we stepped off from – is that the reason that the Full Courts of the Federal Court give for putting aside these dicta is to say that what we are about to see on pages 276 to 277 sweeps away these very dicta we just saw here and Justice Dixon’s articulation in the Maeder v Busch Case and the Re C & W Case.
We submit it would be unlikely that their Honours would be saying those admittedly parenthetical dicta when they are about to sweep them away, when they are sweeping away another exception, which is the agricultural exception or exclusion. So, your Honours, beginning at 276 in the middle of the page in broadening the concept of vendible product:
what is meant by a “product” in relation to a process is only something in which the new and useful effect may be observed ‑
but their Honours are not including human beings, your Honour –
Sufficient authority has been cited to show that the “something” need not be a “thing” in the sense of an article; it may be any physical phenomenon in which the effect, be it creation or merely alteration, may be observed: a building (for example), a tract or stratum of land –
the instant case before their Honours –
an explosion, an electrical oscillation. It is, we think, only by understanding the word “product” as covering every end produced, and treating the word “vendible” as pointing only to the requirement of utility in practical affairs, that the language of Morton J.’s “rule” –
which was that it must be a vendible product –
may be accepted as wide enough to convey the broad idea which the long line of decisions on the subject has shown to be comprehended by the Statute ‑
their Honours invoking it one more time. Your Honours, at 277 in the passage our friends place particular emphasis on, is where their Honours in short broaden the concept of “vendible product” where their Honours say, line 2:
the method . . . has as its end result an artificial effect falling squarely within the true concept of what must be produced . . . to be held patentable.
That is a sound understanding of the development of patent law. It:
exhibits the two essential qualities upon which “product” and “vendible” seem designed to insist. It is a “product” because it consists in an artificially created state of affairs –
Your Honour, that is true of my psoriasis, but their Honours have put that aside two pages ago –
discernible by observing over a period the growth of weeds . . . And the significance of the product is economic; for it provides a remarkable advantage –
Your Honours, we respectfully submit that what we see at 277 does not sweep away those dicta, nor does it sweep away Justice Dixon’s reasoning in the Maeder v Busch Case, nor that in the Re C & W Case on which 60 years of English practice invoked by our legislature from which it flowed. But, your Honours, without taking much time about it, at the bottom of 277 here is a suggestion that there is another class, a whole class of things that fall outside the circumference, namely, agriculture and horticultural processes.
So, their Honours, we submit, cannot have been just forgetting that they have referred to an exclusion two pages earlier of medical treatment, and I do not need to take the time, but their Honours say there is no such exclusion for agriculture from pages 277 to 278, after referring to office practice and so on, and the bottom of 278, eight lines up:
If it means that there is some consideration wrapped up in the label “agricultural or horticultural” which necessarily takes a process outside the area of patentability –
their Honours say, there is not, but their Honours have said that with respect to methods of treatment. I think that is all I need to take your Honours to there. Your Honours, after having promised at length, may we go to Maeder v Busch (1938) 59 CLR 684, please. Your Honours, the ratio of this case was that the method of creating permanent waves in hair was not novel, so it is the same ratio as in the Rescare Case and in the Bristol‑Myers Squibb Case, not novel. But their Honours discuss the question of methods of treatment, and this is broader than medical treatment, it is methods of treatment generally.
Your Honours, again, the argument is interesting, but I will not take time with it. In particular, at 693 onwards, Mr Ligertwood has a written argument – I beg your Honours’ pardon, it is on page 695, there is a written argument on the question of methods of treatment in the context of hair which I will not take time with. As I say, as we have submitted, the ratio is novelty. At 698 Chief Justice Latham’s reasons begin deciding that it is not novel but at 699 his Honour says:
It is accordingly unnecessary for me to deal with the interesting and important question whether a claim for a new method of conducting an operation upon a part of the human body can be protected under the law relating to patents. Such a claim is, of course, quite different from a claim relating to an appliance or a substance –
Just picking up what her Honour Justice Crennan has put to me a few times, there were, of course, actual apparatus claims in the Rescare Case as well as the method claim, of course, your Honour. His Honour says:
I am very doubtful whether such a method or process can itself be regarded as a “manner of manufacture” within the meaning of sec. 4 of the Patents Act 1903‑1935 (See Re C. & W’s Application; R v. Wheeler –
Justice Dixon says it is not novel and then at page 705 says, having given his Honour’s reason for decision then says:
But, apart from any such ground of invalidity, the claims for a mere process consisting in the application of well‑known chemical compounds and heat to the hair, a part of the human creature, raise a serious question in relation to subject matter. Can the discovery or improvisation of a mere process or method of treating any corporeal part of the human being afford subject matter for a patent? To be patentable an invention must relate to an art.
We would accept that following Chief Justice Barwick’s decision in Joos. As his Honour Justice Gageler put to me that has been more confined. Then his Honour quotes again – quotes for the first time – the judgment of Lord Chief Justice Eyre in Boulton v Bull, a very wide description of it which I do not need to read out but between that quote and the next quote his Honour interpolates:
But the ultimate end in view is the production or treatment of, or effect upon, some entity.
It is clear from what we are about to see that a human being is not an entity, in that sense. Of course, we are an entity in another sense. At the bottom of that page his Honour says:
Can the hair growing upon the human head be regarded as satisfying the condition that the process shall in some way relate to the productive arts?
Following what his Honour Justice Hayne put, “Can your psoriasis, an improvement in that, be regarded as relating to the productive arts?”
It is part of the human body, and hitherto none of the prosthetic processes by which any of its parts have been treated has been considered subject matter for a patent. Indeed, in Re C. & W.’s Application Lord Buckmaster, as a law officer, held that no patent could be obtained for extracting lead from the human body.
Then there is the distinction with abdominal and facelifting. His Honour says:
The application of a process or method of treatment to part of the human body for the purpose of improving its appearance –
May I accept a restriction on that –
or ameliorating its condition is distinguished from processes which may form the subject of patentable invention in aim and result.
This is, as I say, we adopt this as the best way we can express the normative principle behind it, your Honours:
The aim is the alteration of some state or condition, feature or attribute belonging temporarily or permanently to a person. The result may be an improvement in his or her physical welfare –
Can I skip “appearance” –
It is difficult to base any legal distinction on the motive or purpose of the operator or manipulator or on the vocation he pursues. It can hardly matter whether he acts in the exercise of a profession or art or trade or business. The purpose of the patentee and those intended to employ the process may be entirely commercial. The process may be intended for use in ordinary trade or business such as that of hairdressing –
and I say or medicine –
The purpose, on the other hand, may be the relief of suffering by surgical or manipulative means. But –
crucially, your Honours –
the object is not to produce or aid the production of any article of commerce. No substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence by means of or with the aid of the process.
That is the best we can do. We put it that way, your Honours. That is why they have not been accepted in England. They were initially excluded by the courts. Then the 1977 Act deemed that methods of treatment were not capable of industrial application. Your Honours remember that the TRIPS Treaty allows us to exclude methods of treatment for that reason, to do with industrial application. They have now amended the European Convention and consequently the UK Act to exclude them specifically not as a deemed exception to industrial applicability. But his Honour goes on, and this was picked up also in NRDC:
On the other hand, a widening conception of a manner of new manufacture has been a characteristic of the growth of patent law.
Then there is the reference to the memorandum of counsel, “if it is embodied in a manual art or craft”. That too was picked up in NRDC, and there is a distinction between “the hair” and the “human frame” which does not trouble us, your Honours. Then his Honour says at line 4 on page 707:
This view of the matter confesses and avoids the general proposition that a mere process or method for the treatment or manipulation of the human body cannot afford patentable subject matter.
That is what we submit Sir Garfield Barwick did. He confessed and avoided that proposition. Justice Evatt briefly, with respect to “hair”, says:
it cannot be laid down as an absolute rule that although the making of artificial curls for subsequent use . . . can be protected –
that is in a wig –
doing very much the same thing with the hair that is already on the head cannot be –
and Justice McTiernan described it as:
could be held to be good subject matter of a patent only upon a wide, and perhaps novel, interpretation -
So, your Honours, we submit that is the principle and that is one of the things that the legislature expressly when it invoked said when IPAC said we do not need to have specific inclusions and exclusions in our Act like England, we should stick with this continuing concept. Then the legislature said we invoke a long line of Australian and UK decisions.
Your Honours, the Re C & W Case is at (1914) 31 RPC, and it was a process - Sir Stanley Buckmaster, a process for extracting, in particular, lead from persons suffering from lead poisoning. In Boulton v Bull Justice Buller said you cannot have a patent for the method of administrating arsenic to cure the ague. The reason we have not taken the Court to that, back in 1795, is it may have been just the early days when processes and products were – sorry, when it was less clear that you could patent a process. But the Solicitor‑General says it is not proper subject matter of protection under the Act, then the Solicitor‑General quotes the legislative structure, which is the same as ours relevantly and then at about line 30 shows that what is meant by “new manufactures”:
is something associated with the manufacture or sale of commercial products –
Then his Honour does invoke the proviso, section 6:
I think therefore, we must start with the assumption that an invention within the meaning of the Patents Act 1907, is an invention for a manner of new manufacture that is some way associated with commerce and trade. It is quite plain that that does not merely mean that it must be a product.
So really the “vendible product” issue has to some extent been a red herring.
A manner of new manufacture may be a thing newly made, or a substance which, if made before, is improved in its manufacture; or, quite apart from that, it may be a machine or a process that can be used in making something that is, or may be, of commercial value. If I am right in that view, the question which I have to consider is whether the process described in the present Specification is something to be used in the making of an object that is or may be of commercial value or is a process adapted to that end. I find it difficult to see that it is. It is in fact a process by which certain well‑known electrical apparatus [here, leflunomide] is to be applied for the purpose of extracting lead from living objects –
here, curing their psoriasis –
Further, I think, on a true reading of the Specification, those living objects are meant to be human beings. So far as human beings are concerned, it cannot be suggested that the extraction of lead from their bodies is a process employed in any form of manufacture or of trade, though the human being may be a better working organism when the lead is extracted.
Then it is said it might be applied to other animals. That is so, but, in my view, that is not what the Specification contemplates –
picking up what her Honour Justice Crennan put to me –
if it were an Application simply for the use of the process for the purpose of removing lead from animals in order to make them better marketable products, it might be that different considerations would apply. My judgment is not intended to exclude any such Application; it is merely intended to cover this, that the application of a process for the removal of either lead or other noxious substances from the human body is not, by itself, the subject‑matter of invention within the meaning of the Statute. I notice that the Patent Office have based their refusal upon the ground that the alleged invention relates simply to medical treatment, and I think that the foundation for that refusal is sound.
I do not base this on ethics, on the Hippocratic oath, his soon to be Lordship then says, Sir Stanley. I do not need to read that out. He does not base it on that and then as I mentioned in answer to her Honour Justice Crennan, if the applicant desires to apply for something applicable to merchantable articles, like sheep or cows, that may be the subject of different considerations, so, in answering his Honour Justice Hayne’s question, in 1990 and apart from one more case, the Upjohn Case, that was the state of play. The Upjohn Case takes us up to 1977 when the UK Act enacted an express exclusion. The state of play was the dicta that your Honours have seen in Maeder and NRDC. His Honour Chief Justice Barwick, confining it but recognising it, and the Act was on that basis.
Now, the question is, we respectfully submit to answer your Honour’s question directly, we submit, whether the Court is sufficiently persuaded by the reasoning in Rescare and Bristol‑Myers Squibb, to depart from what is close to 100 years of development of the idea of the ambit of the statute and we submit that the principal reasoning, why the two Full Courts do not assist - the second one is easy, Bristol‑Myers Squibb is solely about the question of generally inconvenient and their Honours hold that it is not generally inconvenient, to put it shortly, or that that ground should not render the patent in the second of the Full Court’s – not the manner of manufacture.
So it is really Rescare is the problem and Rescare procedures will attempt to show on the wrong basis that we – at which Chief Justice Barwick hinted or started running that NRDC swept away what Sir Owen said in Maeder v Busch and Re C & W we have just seen and that it having been swept away, we are left with generally inconvenient. Both of those, we respectfully submit, are wrong.
Your Honours, may I take the Court to the Upjohn Case [1977] RPC 94 but it is a 1975 decision reminding your Honours that it is, as far as we can see, the last word in the English judicial decisions before the Act was amended in 1977. We see on page 94, it is an appeal from Justice Whitford who was the Patent Appeals Tribunal, just a summary:
The applicants’ complete specification included claims to a method of reducing gastric secretion in mammals by the systemic administration of certain compounds.
Then there is a question about an amendment to deal with the animals but, your Honours, Lord Justice Russell at page 96 mentions the argument that I had mentioned earlier that the Comptroller, not the Commissioner, the Comptroller of Patents, said our test is it has to be established with certainty, line 8:
that such a method is not capable of being the subject of a grant of letters patent . . . the Comptroller was obliged to accept the application and leave the question of principle to be definitively established in . . . a suit for revocation . . . In effect we were not asked to decide whether such method of treatment is or is not capable of being the subject of a grant of letters patent, but to say that it was not sufficiently clear that it was so incapable.
At line 28:
Now it is admitted for the appellant that it has always been the view of those professionally concerned with patent law that such a method of treatment is not within the definition of “invention” –
That is why we gave your Honours a reference to Blanco White who just says that, and Chief Justice Barwick in a passage I did not need to take your Honours to shows the development of that through Terrell’s textbook –
In various amendments and consolidations of the statutes affecting patents, the result of deliberations by informed Committees or Commissions, no step has been taken to controvert that view, which must have been known, by those responsible for re‑enactment with or without variation of statutory provisions, to be universally held –
Then there is a reference to enactments based on a legislative misapprehension. So, your Honours, we submit the same was so in 1990. Then, your Honours, at 97, after putting aside an argument which is not relevant about the question of compulsory licencing –
there is no actual High Court –
authority there ‑ line 6 ‑ the reference to the C & W Case that I took your Honours to, and then there is a reference to Schering’s Case which our friends refer to where contraceptives, or method of treatment of contraceptives, was carved out of the exclusion. We do not wish to argue about that one today, your Honours. I, myself, find that an unconvincing carve‑out – sorry to use that phrase again – but their Honours say at line 22:
We have no difficulty in distinguishing in principle contraception from treatment of an ailment. The Australian N.R.D.C. case . . . was a case in which it appears‑though not necessary to the decision‑to have been accepted that, as the law stood, a method of treatment now in question was not patentable.
Your Honours know that the NRDC Case became a very celebrated case worldwide for its breadth of the concept, its articulation of the breadth. Then there is a reference to the Israeli case – may I skip that, your Honours – then there is a reference to Chief Justice Barwick’s decision at the bottom of the page:
treatment of hair and nails in vivo: he considered that the principle that methods of treatment of ailments in human beings were not the proper subject of a patent was to be narrowly construed: he did not for the purposes of that case challenge the principle, though we think it reasonable to say that he was not wholly content with it.
We would respectfully agree with that, your Honours; I think that is a good way of putting it. We can skip over the Swift Case, your Honours; that is about the burden on the Commissioner, or the Comptroller. Line 8:
Nevertheless, in our judgment, it is well established that a method of treatment of a human ailment with a known substance is not capable of being an invention under the statute: the Comptroller was correct –
The cases your Honours have now seen was the landscape in the UK and Australia when the 1990 Patents Act was enacted and as the explanatory memorandum says, we are invoking a long line of UK and Australian decisions. So, your Honours, they were not patentable.
FRENCH CJ: Is there any relevant textual difference between the 1952 and the 1990 Acts?
MR CATTERNS: No, your Honour, not relevantly. The definitions of “invention” are exactly the same in section 6 of the 1952 Act, and that is in our bundle. The ground of revocation was – perhaps I should read it out to your Honour – in section 100 was:
that the invention, so far as claimed in any claim . . . is not an invention within the meaning of this Act -
That was 100(1)(d), your Honour.
GAGELER J: But are you going to say something in‑chief about section 18(2)?
MR CATTERNS: Yes, your Honour, may I come to that? The short point of that, your Honour, is that that is a different – well, I will deal with it now of course, your Honour. May I just draw your Honour’s attention to section 18(2). That is an express exclusion of:
Human beings, and the biological processes for their generation, are not patentable inventions.
So, your Honour, that specifically related to, in effect, cloning and Senator Harradine – the legislative history shows how that came in – his concern about moral aspects of cloning. So we submit that in effect it is a different genus and this is not intending by ejusdem generis to say but methods of treatment are in. Your Honours, the Full Court decision is in Anaesthetic Supplies v Rescare (1994) 50 FCR 1. May I just remind your Honour of the facts of that.
Professor Sullivan published an article in The Lancet which was published in England before Easter – pre the internet, The Lancet being on the internet – he applied for his patent on the Tuesday after Easter and the first copy proved to – sorry, he applied for his provisional on the Tuesday, and the first copy proved to arrive in Australia arrived on the Wednesday. So he needed – that is well before he lodged his complete specification – so he needed to be fairly based on his provisional specification or he was rendered invalid by the publication in The Lancet. That is the ratio of the case, that it was not fairly based.
The ratio of the case can be found in a sentence, so far as it relates to these claims, the method of treatment. That sentence is at page 24, because it was accepted that if there was no entitlement to the earlier priority that patent was anticipated. At C, page 24:
Claim 9 abandons the nostril attachments which are of the essence of the provisional specification, so it cannot be fairly based on it.
In that sentence the patent was held invalid. The picture, just to give your Honours the last fact, is at page 42 where we can see that the headband went, I think, around the person’s head, but in particular, there are two little nostril attachments that were put in the person’s nose and held in by silicon - by the time of the patent in suit it was a far more elegant nose mask - held that the method, even the method, was not fairly based on this, even though he had the same idea, but each judge dealt with the matter very fully and, your Honours, we were not going to take time with Justice Lockhart’s very full discussion from pages 6 and following of the decision in many other countries, including Maeder v Busch, NRDC and Joos. His Honour also drew attention to the UK position, but his Honour’s principal reasoning begins at page 16 under “Findings”:
There are, therefore, in jurisdictions outside the United Kingdom, cases which go some distance towards recognising the patentability of methods of treatment of human beings which are no more than the application of old compounds for new therapeutic uses -
as we have here. That is to be encouraged, but it is a balancing exercise, but the question is, with respect, who is to do that balancing exercise? We submit that the legislature recognised the exclusion in 1990 and it is for the legislature to bring methods of treatment in to an established ambit from which the established ambit is that they are excluded. His Honour says:
The United Kingdom decisions adopt the conservative approach of not permitting as patentable inventions, discoveries of methods of treating the human body –
Then the Patents Act 1977 was in the terms that we discussed, your Honours, referring to the earlier version of the EPC. They were deemed not – your Honours see at B:
shall not be taken to be capable of industrial application . . .
There is no similar provision in the Australian 1990 Act.
Then his Honour refers to 18(2). His Honour says:
The decisions of the English courts base their conclusions that methods of treating the human body are to be excluded from patentability on a variety of grounds, primarily grounds of ethics rather than logic –
Well, your Honours, that is true of some of the dicta in some of the cases before the Upjohn Case, but it is certainly not true, we submit, of the Upjohn Case or the Re C & W Case, and that is a qualification there. His Honour – and his Honour Justice Gummow at first instance had also done this – agreed with Chief Justice Davison in the New Zealand Case, his Honour decided the matter at first instance in New Zealand and the Court of Appeal held that methods of treatment were not patentable and that, as we have given your Honours a reference, the Court of Appeal has again looked at the question in the Pfizer Case, sitting five, and held that methods of treatment are not patentable, I readily accept, largely on the question of general inconvenience, and the New Zealand Patents Bill has an express exclusion, it being held up, indeed for years, because it expressly excludes computer programs as currently drafted. Then at E, Justice Lockhart says:
The Chief Justice also said that there was a lack of logic in any distinction which produced the result that a product for treating the human body would be patentable but not a method of treating the human body.
We respectfully submit that – there is no problem there. Medicines have been patentable for centuries and there are completely different considerations involved. You can have a process for making a medicine, it is a physical thing that you can buy and sell. That gives a great deal of stimulus to innovation, incentive to innovation, but methods of treatment are not patentable on the ways we have submitted.
His Honour draws attention to the question that they were not revocation cases - I am looking at F - and the question was “practically certain” but we respectfully submit that makes the – gives those decisions even greater force because they were deciding the basis on a higher test. His Honour says – then citing Commissioner of Patents v Microcell for our same test that I referred to and Joos - this was a revocation case:
It is also now the long established practice of the Commissioner of Patents in Australia to accept applications in respect of inventions of the character of the present patent. There is no material before us which would suggest deleterious consequences –
It is hard to think of evidence that would be admissible in that case and how we would make all things equal. It was also argued in that case, Rescare, that the claim in terms of claim 9 which was a method of treating sleep apnoea by using this apparatus was generally inconvenient. Then his Honour refers to the art of the position or surgeon does not belong to an area of economic endeavour. I am at A to B on page 18. May I skip four lines down, criticising Re Eli Lilly, so Chief Justice Davison in Wellcome - this is the important thing, your Honours – at C:
The original basis which was reaffirmed in the C and W case in 1914 was not ethics, but that a process for medical treatment was not “an art of manufacture” or was not a form of manufacture or trade. As Davison CJ observed –
again, at first instance in New Zealand:
now that the foundation for the decision in the C and W case has been removed by subsequent decisions –
and that is a reference to what Chief Justice Barwick said in Joos and NRDC and that is a wrong premise, we submit, your Honours -
the courts have been grasping for some other ground –
This is the “swept away” approach that his Honour Justice Wilcox also articulates. Your Honours, we respectfully submit that the next page and a half is reasoning based on policy that we submit is better left to the legislature if it decides this question, never having been authoritatively settled by the High Court as his Honour the Chief Justice pointed out. It is for the legislature to decide to include these currently excluded concepts. Then his Honour says at C on page 19:
I see no reason in principle why a method of treatment of the human body is any less a manner of manufacture than a method for ridding crops of weeds as in NRDC.
That is to put aside the dicta that I have taken the Court to. With respect, the next sentence does not carry matters much further:
Australian courts must now take a realistic view of the matter in the light of current scientific development and legal process –
Medicines have been patentable for centuries. We are up to date. I can skip over D, but just above E:
If a process which does not produce a new substance but nevertheless results in “a new and useful effect” so that the new result is an “an artificially created state of affairs” providing economic utility, it may be considered a ‘manner of new manufacture” –
We accept, your Honours, that that is necessary but it is not necessarily sufficient to be a manner of new manufacture. Parliament had the opportunity to exclude it, his Honour says in F, but the limit of the exclusion was 18(2) and his Honour holds it at say proper subject of letters patent. Your Honours, although it is a very elegant and interesting judgment we will not take time with his Honour at it. It has a result that we embrace. We were not going to take time with Justice Sheppard’s reasoning because it is reasoning that we have expressly abandoned.
GAGELER J: Part of the policy analysis that you say is best left for the legislature might be found back at page 13 of Justice Lockhart’s judgment. There is an extensive quotation from the Banks Committee report which appears to be dealing, in effect, with the problem raised by this very case, that is – you see at the bottom of page 13.
MR CATTERNS: Yes, your Honour.
GAGELER J:
“A process consisting of using a known compound for treating a human being –
The point made over the top of the page, page 14 near letter A, is that it appeared to be common ground amongst all those involved in the policy debate that if there were to be a change in the law there would need to be adequate safeguards for medical staff and patients so that their action could not constitute infringement of the patent.
MR CATTERNS: Yes, your Honour. I accept that is certainly one of the policy considerations. The Committee goes on, your Honour, in paragraph 239:
Since new chemical compounds, processes for making such compounds and even known compounds presented in a different form are already patentable –
Your Honour, my learned friend and I are in a case where there are 29 prior patents for the one compound. You can have crystalline forms. You can have salts. You can have a process for the manufacture of the thing itself, a process for the manufacture of the intermediates, pharmaceutical compositions, et cetera. Indeed, the prior 341 patent here illustrates that in its four claims. But, your Honour, if I may go on:
the only type of invention which would be patentable under the proposal would be a known compound in a known form which could be used against a disease for which it was not previously thought to be effective. The extension of patent protection –
which is what it would be, your Honours. We submit that the position in 1990 is as we have put it –
in this way would result, in effect, in patents for the treatment of human beings, since a claim for such an invention would have to specify the condition against which the compound was effective and to include instructions for its use.
That is what - to pick up Justice Hayne’s comment to me again, that is what is here. The condition is psoriasis. The instruction is administer an effective amount. This would not be desirable, the Committee says:
The majority of other countries do not grant patents –
and on they go.
CRENNAN J: Then they have now gone the deemed novelty route.
MR CATTERNS: Yes, your Honour.
GAGELER J: Is there protection for medical staff and their patients?
MR CATTERNS: No, your Honour, there is no - methods of treatment do not – there are no patents for methods of treatment in the UK. They were expressly deemed not to be industrially applicable and now they are expressly excluded. Perhaps if I could just show your Honours those provisions quickly. In the bundle of materials, tab 17, just to answer the question that her Honour Justice Crennan has raised with me, this is the current form in the new section 4A which matches the Convention:
A patent shall not be granted for the invention of‑
(a)a method of treatment of the human or animal body by surgery or therapy, or –
and this would be therapy –
(b)a method of diagnosis practised on the human or animal body.
Then, your Honour, that exclusion is made clear that that does not apply to an invention consisting of a substance for use in any such method and the deemed novelty is in 4A(3):
In the case of an invention consisting of a substance or composition for use in any such method, the fact that the substance or composition forms part of the state of the art –
In other words, is not novel per se –
shall not prevent the invention from being taken to be new –
Deemed novel –
if the use of the substance or composition in any such method –
in the new method –
does not form part of the state of the art.
Subsection (4) relates to specific uses. But, your Honours, that allows a product and, as I submitted in answer to her Honour Justice Crennan, the way you infringe is – Justice Hayne’s phrase – instructed use. So if you sell a product for use in that method they sue the manufacturer. The old form, your Honours, is on the next page.
HAYNE J: Just before you part from 4A, 4A(3) is a negative:
shall not prevent the invention from being taken to be new ‑ ‑ ‑
MR CATTERNS: Yes, your Honour, it is a funny phrasing, but I read it as a deeming. You are allowed to take that as being new perhaps, your Honour. I can see your Honour’s point, with respect. I think it is regarded as deeming them as novel. I suppose the point is it might not in fact be novel, of course.
FRENCH CJ: There might be some other ‑ ‑ ‑
MR CATTERNS: There might be, exactly, your Honour. Thank you. At page 36 in our bundle was the Act as enacted in 1977 in the UK and this preceded the Industrial Property Advisory Committee in Australia in 1984, looking at it, and the conditions were (a) “new”, (b) “inventive step”, (c) “capable of industrial application”. Then in (d) there were express exclusions, discovery, literary works, scheme for “performing a mental act” or computer program. Then in (3) there is public morality. Sorry, I beg your Honour’s pardon, I have skipped – the next one to go to, having put the requirement of industrial application, is at page 42, where, under the heading “Industrial application”, section 4(2):
An invention of a method of treatment of the human or animal body by surgery or therapy or of diagnosis practised on the human or animal body shall not be taken to be capable of industrial application.
Subsection 4(3), which was the window through which Swiss claims were driven, if I can put it that way so, your Honours, we respectfully submit that the reasoning of his Honour Justice Lockhart, accepting that it is more full reasoning than the two short dicta we rely on in NRDC, but it is based on the fundamental error that NRDC swept away the earlier reasoning that we see in Maeder v Busch and Re C & W.
His Honour Justice Wilcox agreed with his Honour - as I said, Justice Sheppard dissents on the ground of general inconvenience, and then at the bottom of page 42, in the last paragraph, he says:
if the matter did fall for decision –
because it was not novel –
I would reject the appellant’s argument . . . Policy arguments may be made, each way, upon the question whether the law should permit such a grant. These arguments are developed in some of the cases cited by Lockhart J . . . The important point, it seems to me, is that the Australian Parliament has not been persuaded by the policy considerations arguing against patentability. Parliament has never excluded a method of human medical treatment from patentability or the definition of “invention”; not even in the recent statute –
But, your Honours, with great respect, that gets it the wrong way around. In 1990 the established ambit did exclude methods of human medical treatment. When that Act was passed it invoked this whole concept, the established ambit, and they were excluded so his Honour who is about to say we should be slow to introduce an exclusion is wrong. His Honour should be saying the question is whether the exclusion, at least recognised in NRDC, ought to be swept away. His Honour mentions 18(2). His Honour rightly says that the Act left intact the principles developed by the courts in the connection with the application of section 6. His Honour says:
However, I believe that, in the face of apparently deliberate decisions by Parliament not to build this particular exclusion into its legislation, courts should be hesitant to introduce the exclusion by reference to those very general principles.
We submit that has got it quite the wrong way around. His Honour says:
This is not a case of a judge‑developed exclusion being the corollary of still‑accepted principle.
We respectfully submit that is quite wrong. The question is are we getting rid of a judge‑developed or judge‑recognised exclusion of longstanding. I can skip over the reference to Re C and W’s Application but his Honour says in E:
While the notion of manner of new manufacture was limited to that described by Sir Stanley, it was natural that his decision should be followed –
I interpolate as it was for 60 years:
although, perhaps, in recent years it has become more apparent that medicine and commerce are not total strangers –
That then refers to the passage in Chief Justice Barwick’s reasons that refer to the economic interest in the health of members of the workforce but Sir Owen Dixon saw that in 1938, of course, your Honours, as you would expect:
But the notion of manner of new manufacture was extended by the decision of the High Court of Australia . . . some advantage which is material, in the sense that the process belongs to a useful art as distinct from a fine art . . . see at 275 –
the very page where one of our two dicta appears –
Once it is accepted that it is enough to support a patent that the subject process produce a useful result – and not necessarily be, or be capable of producing, a vendible product – the rationale of Re C and W’s Application is swept away.
We respectfully submit that is wrong. His Honour refers at the top of page 44, line 4:
United Kingdom judges accepted NRDC, and recognised that it destroyed the foundation of Re C and W’s Application.
We respectfully disagree. Your Honours saw the Upjohn Case in 1977. Quite the contrary. Their Honours saw the NRDC Case as continuing to accept obiter the exclusion. Then, your Honours, in a sense this is really what the argument is about. His Honour says:
it seems to me that the principle applied in Re C and W’s Application is not so deeply embedded in Australian law as to preclude an appellate court departing from it . . . a judge‑made exception to a general statutory right.
No, it is not, with respect, your Honours. It is not a general statutory right. It is a concept expanded by the courts over 400 years – this is a right to patent for invention and it has been an exclusion, as I have submitted. His Honour refers to the High Court dicta after C:
Even where the High Court decision is not technically binding such dicta will generally be followed by lower courts. But it is obvious that, in each of the three cases where comment has been made, the relevant Justice or Justices assumed (rather than decided) that there was a special rule –
Well, your Honours, we respectfully submit that as a matter of persuasion at least the High Court dicta particularly that in Maeder v Busch is to be preferred. At the bottom of 44 after quoting Justice Evatt and referring to Justice Dixon’s reasons in Maeder – I just point to the omission of Chief Justice Latham’s sentence that I took your Honours to – Chief Justice Barwick at G:
sat as a single judge . . . he realised that NRDC seriously undermined the exception adopted in Re C and W’s Application –
But, your Honours, we respectfully submit that that is a mistake. Finally, your Honours, in B his Honour finds:
unpersuasive the alternative bases for the exception advanced by some judges . . . ethics and social policy . . . In my opinion, for the courts to resort to any of them, in order to engraft onto a recently enacted statute an exception that Parliament has chosen not to adopt, would be to usurp that institution’s role.
We respectfully submit that has got it the wrong way around. In 1990 this was a recognised exclusion or exception. Your Honours, that has dealt with our written outline - if I could just pause for breath. We have taken your Honours to the first page of our three pages and made our submission that Chief Justice Barwick’s dicta does not really – to the extent that it suggests that NRDC swept away the premises on which Maeder v Busch and Re C and W are based are incorrect.
Your Honours, at the top of page 2 of our submission, the phrase that was used in legislative history of the US Act, our paragraph 5, the phrase American Congress used is “anything under the sun that is made by man”. Now, that was also in the Chakrabarty Case that we gave a reference to, your Honours. Your Honours, the very concept is not a concept that grabs every possible thing to grant monopolies. Quite the contrary, it is an exception to the prohibition on monopolies, and what we do is we – I respectfully submit – apply page 269 and look at what the established ambit is, recognising, of course, that it is a developing concept. New technologies have to be considered, whether or not they come within the concept, but methods of treatment, as we submit, do not.
FRENCH CJ: Your argument operates on the premise that what is described in claim 1 is a method of treatment?
MR CATTERNS: Yes, your Honour, so far there has been no dispute about that. It is a method of treating or preventing psoriasis and her Honour said that is a method – her Honour Justice Jagot at first instance – that is a method that has that result, that effect in fact. That construction was rejected by the Full Court and held to be for the purpose. So, your Honours, in our submission, paragraph 6, we submit that that little reservation, as it were, of essentially non‑economic by the Court in NRDC shows that something is different from what his Honour Justice Barwick referred to about the treatment of members of the workforce. I have made our submission in paragraph 7 about generally inconvenient. In paragraph 8, the patentability of “medicines” has been recognised for a long time.
Now, your Honours, the second group of objections is that – perhaps just picking up on what his Honour the Chief Justice put to me – a second problem with a second medical use such as this is what is here is now a new purpose and a patent, this particular patent, being limited by the purpose gives rise to many difficulties. We give a footnote to our submissions about that in detail and ‑ ‑ ‑
HAYNE J: Can I take you back to this question of method of treatment?
MR CATTERNS: Yes, of course, your Honour.
HAYNE J: How do you describe the method of treatment?
MR CATTERNS: In the present case, your Honour?
HAYNE J: Yes.
MR CATTERNS: Just looking at the claim.
HAYNE J: I can read the words but does it come to the oral administration of the compound for the purpose of, with the effect of, with the intended effect of, or some combination or variation of those?
MR CATTERNS: Yes, your Honour, indeed that was part of the debate and we submit that the Full Court held, rightly, accepting our submission, that it means for the objective purpose of treating psoriasis.
HAYNE J: Objective purpose?
MR CATTERNS: Yes.
HAYNE J: How does objective purpose engage with the administration of a product to a patient?
MR CATTERNS: Your Honour, it is a very difficult thing, I accept, because there is a chain of command, as it were, from Apotex, our client, who sell the drug to a pharmacist or a hospital. A physician writes a script and she says “leflunomide” and then ‑ ‑ ‑
HAYNE J: Having taken a history from the patient, formed a view, formed a diagnosis, et cetera. Yes?
MR CATTERNS: Yes, I will take your Honour to what Justice Keane said about that. Having done all that, your Honour, the patient goes to the pharmacist. If the box is ticked they are not allowed to substitute for a generic product. The patient takes it home and he or she takes the pill in whatever amount was prescribed. Now, your Honour, it is very difficult - that is what I was about to get into - to see how you can run a purpose, how there can be a purpose – a patent can be limited by a purpose like that because as Lord Hoffmann points out in the case we will take your Honours to, our law has traditionally not inquired into purpose. Now, I must face the fact that the claim in the NRDC Case is a claim for a purpose, a method of treating weeds in leguminous crops.
CRENNAN J: But you have a new use for a known product. How else can you ever identify novelty except in relation to a purpose which was hitherto unappreciated?
MR CATTERNS: It is easy to see it, your Honour, in the case of NRDC because there is a farmer with a backpack with two kilograms per acre of the drug that was the subject of the claims, but here how do we get down to the doctor’s purpose? The classic example that Lord Hoffmann – may I step back? I am sorry this is a long way of answering your Honour’s question, but it is a crucial question and at the right point in our argument, if I may say so. Part of the reason is because it is twice said we do not follow European jurisprudence, indeed, we do not regard the decisions of the EPO as jurisprudence. The Court said that in Lockwood v Doric and also in the Alphapharm Case.
One can see the distaste of experienced patent judges in England feeling bound by a number of European decisions in this territory, the classic one of which - forgive the digression, but we were going to come to it, your Honour - is the Mobil friction reducing additive case where you do exactly the same thing, picking up what her Honour Justice Kiefel asked me long ago - you put the pill, you pour this stuff in your engine in the hole where you put the oil in and the ‑ ‑ ‑
HAYNE J: Is it to reduce rust, reduce friction or just make it go better?
MR CATTERNS: Exactly, your Honour. Precisely the same act – and her Honour Justice Jagot here held the act is oral administration to treat disease – precisely the same act is involved and how do we get down to purpose? Now, maybe if you have a system like the English section 4A where you say we have this drug for this new purpose and you instruct the purpose, instructed use, 117(2)(c), maybe that can work, but if you are down at the territory of inquiring into the effect on an actual patient – which was her Honour’s construction – or the purpose of the doctor, subjective or objective, then we submit we are in a territory where Australian patent has not gone. We put this as our second basis on which we say methods of treatment are not patentable because it is inescapable, on the Full Court’s construction, that you have to inquire into the purpose of the doctor.
HAYNE J: Well, the question then becomes what is the statutory hook, the textual hook ultimately, on which questions of purpose, effect and the like are hanging. Now, I am not saying there is no hook there, but at some point it has to be identified.
MR CATTERNS: Well, I think, your Honour, I say there is no hook.
FRENCH CJ: You step around it under the deemed novelty provisions in England, do you, by getting another patent, as it were, for the substance and you do not lose novelty because of its previous application for different purposes?
MR CATTERNS: Yes, your Honour, exactly.
FRENCH CJ: Different uses, I mean.
MR CATTERNS: Yes, exactly.
CRENNAN J: But then what happens in the hands of the doctor or the patient with the deemed novelty? I mean, I know you sue the manufacturers through the supply, indirect infringement.
MR CATTERNS: Your Honour, we have searched to find any case that answers your Honour’s question. We cannot find one in England. The short point is though they say that the doctor is protected by the doctrine of exhaustion of rights.
CRENNAN J: Well, that is the answer, is it not, I suppose. I mean, it may not be a dissatisfactory answer but otherwise the doctor or the patient are guilty of infringement, are they not?
MR CATTERNS: Because they use.
CRENNAN J: Because they use for the purpose identified as being something that is deemed to be novel.
MR CATTERNS: Yes, your Honour, a product – always remembering it is a product.
FRENCH CJ: A product is deemed to be novel. The product does not lose novelty because it is been used for other purposes before ‑ ‑ ‑
CRENNAN J: Because it is known.
FRENCH CJ: So you can get another patent for the same product on the basis of a new use.
MR CATTERNS: Yes, your Honour. If our law allowed that, I could imagine very interesting arguments about that, but the practical answer is the doctor does not infringe of course when she prescribes it from the owner of the patent because of the doctrine of exhaustion of rights or, in our law, implied licence, the Time‑Life Case.
HAYNE J: I can understand under the 1977 Act, section 4A of the UK, you have the phrase for use in “a method of treatment” and that is an evident statutory hook from which all of these questions of purpose, intention and the like must hang because 4A(3):
shall not prevent the invention from being taken to be new if the use . . . in any such method –
What is “such method” -
a method of treatment of the human or animal body by . . . therapy ‑ ‑ ‑
MR CATTERNS: Yes, your Honour.
HAYNE J: But for use – all right, takes you off into a perhaps fascinating and wonderful area of discourse. How do we get into it under our Act?
MR CATTERNS: That is our second ground as to why methods are not patentable, methods of treatment are not patentable because for them to work at all it has to be purpose limited, it cannot be effect limited, and this claim was construed by the Full Court as being purpose limited. We say when you do that you are then in insuperable problems. Well, it is no hook.
GAGELER J: Is that not a problem that was addressed, though, in the NRDC Case to which you have referred, page 263 about point 7?
MR CATTERNS: Is that where their Honours say novel for the new purpose, in effect?
GAGELER J: Yes.
MR CATTERNS: Yes.
GAGELER J: Using a known substance in the same way for a new purpose was patentable, at least that is as I understand it.
MR CATTERNS: Yes, your Honour. If there is novelty in – but that is – is your Honour talking at the top ‑ ‑ ‑
GAGELER J: There is nothing in the judgment of Lord Justice Lindley. It is that very long sentence.
MR CATTERNS: Yes, but their Honours go on to say that:
There is nothing in the judgment of Lindley L.J. to justify a denial that, in respect of process for achieving a useful result by the employment of a substance to produce effects which antecedently it was not understood to be capable of producing, the inventiveness which is essential for a valid grant of a patent may be found in the step which consists of suggesting the use of the thing for the new purpose –
So that is analogous to section 4A, I accept, your Honour. May I just draw attention to another paragraph in the same vein? That is at page 265 in NRDC, at about line 8:
This is not a claim which can be put aside as a claim for a new use of an old substance, true though it be that the chemicals themselves were known to science before the applicant’s investigations began. It is a claim which denies that the chemicals are old substances –
at all in that sense -
It treats them as substances which in the relevant sense are new –
That is very like section 4A of the UK Act.
GAGELER J: My question is how is your submission to be reconciled with that passage in NRDC at page 263?
MR CATTERNS: Because the relate to novelty or Microcell new use of an old thing and we are submitting that there are insuperable practical difficulties in determining infringement of a claim such as the present where it either depends upon the effect in fact on the patient but that submission has been rejected, that construction has been rejected, or it depends upon the purpose of the doctor. This is our secondary argument, as your Honour knows.
We submit that methods of treatment are not within the ambit of the statute. Another reason why they do not belong within the ambit of the statute is that it necessarily involves an inquiry into the purpose of the doctor, and that is really talking about a different thing, I submit, than the novelty consideration here.
GAGELER J: But the argument goes so far as to say that any process that is defined by reference to purpose cannot be patentable.
MR CATTERNS: Your Honour, that is why I drew attention to the claim in NRDC. I cannot say that, because there we have it in NRDC. These are claims which – it is a method for eradicating weeds from crop areas and it comprises spraying it on the crop and the enzymes in the weeds broke the compound down into a way that made it fatal to them – in the weeds – but not in the clover or the lucerne.
CRENNAN J: The idea was, was it not, that when you speak about something which is known and then you discover a new use for it, what you realise it was not fully known; it was only partially known.
MR CATTERNS: Yes, exactly, your Honour.
CRENNAN J: That is the point of that passage about them being treated as new, which is picked up by Justice Lockhart also when he is dealing with these issues.
MR CATTERNS: That gives it novelty, and I hope I said it, that these claims are purpose claims in the NRDC Case and that can give you novelty as in section 4A of the UK Act, but our secondary argument on method of treatment is how does this apply in the case of doctors and patients?
FRENCH CJ: Mr Catterns, we might return to that at 2.15.
MR CATTERNS: Thank you, your Honour.
AT 12.46 PM LUNCHEON ADJOURNMENT
UPON RESUMING AT 2.15 PM:
FRENCH CJ: Yes, Mr Catterns.
MR CATTERNS: May it please the Court. Your Honours, I would like to, if I may, finish my answer to the matter his Honour Justice Gageler raised about the NRDC Case and then pick up his Honour Justice Hayne’s suggestion about focusing on the present case in relation to this question of purpose. A way into it, may I, is via the Advanced Building Systems v Ramset Case 194 CLR 171, and your Honour the Chief Justice dealt with all of these cases including the Bristol‑Myers Squibb Case and the Gray v Western Australia Case. We had not proposed to go to that because your Honour said it was a matter for the High Court, to put it shortly.
FRENCH CJ: Nice of you to mention it.
MR CATTERNS: Well, your Honour, with respect, has elegantly summarised the position. Your Honour does point out that this case, the Advanced Building Systems v Ramset does touch upon, and I do not put it any higher than the present question, but it does in a way that leads me into my answer to Justice Gageler so it is another reason to mention it. In paragraph 8, your Honours, this case followed the Philips v Mirabella Case and it related to the first of the two grounds that the Court was dealing with in NRDC, which is the ground based on Microcell about mere new use of a known thing which indeed is being dealt with at the passage that his Honour Justice Gageler took me to - that is why I am mentioning it, or it is one of the reasons I am mentioning it - before their Honours get onto the concept of is it within the concept of a manufacture. They are two limbs of the concept of manner of new manufacture that I drew attention to at pages 261 to 262.
Here, your Honours, what happened in this case was, starting from a suggestion in the Philips v Mirabella case, that where the quality of inventiveness does not appear – it appears on the face of the specification that the quality of inventiveness is lacking, which is the Microcell idea, the first thing the Court dealt with in NRDC, then it is not a manner of manufacture. The Court also in Philips said, and that may not need to appear on the face of the specification, and what the Court did in this case was overturn the decision of the Full Court which went outside the specification to supply a missing integer, the rope that pulled the clutch that pulled up the concrete.
Just for convenience, in paragraph 18 at page 185 – and that was rejected, I do not need to go into that – there is the quotation from section 100 of the Act that his Honour the Chief Justice asked me a while ago. There is (d):
that the invention, so far as claimed . . . is not an invention within the meaning of this Act –
and they had the same definition as we do. Can I just note that (2) deals with “secret use”. Your Honours, their Honours in short were setting out to confine, or to describe, a fairly confined aspect of this concept of manner of manufacture as being a stand‑alone ground of revocation, and so in paragraph 33 they are in short pointing out that things that might in the old days, in 1623, have been embraced by the concept have now their own sections, and that is a submission I have already drawn attention to in section 18 of the Act. But at the top of 190, after a quotation there is a reference to “secret use” and their Honours say that:
assumes that issues of obviousness and lack of novelty are extracted . . . from what otherwise might have been their inclusion (by means of par (d)) in the general concept of invention within the ambit of s 6 –
because, in short, the argument that succeeded below in this case was an argument that belonged under the head of novelty or obviousness if at all. So, they are dealt with specifically and exhaustively in (e) and (g). There remains no scope for the doctrine of secret use as a qualification on obviousness and novelty in (d). Their Honours ask:
What then was left to provide the doctrinal context of par (d) -
the one we are talking about today.
Section 6 . . . excluded any manner of new manufacture which was “contrary to the Law” or “generally inconvenient”. The classification of certain methods of treatment of the human body as an inappropriate subject for grants under the Act appears to rest on this footing.
Your Honours, that picks up what his Honour Chief Justice Barwick said in Joos as your Honours know. There are two things: one is, of course, it picks up the remarks of Justice Barwick that we respectfully disagree with, that it rests on “generally inconvenient”. You only need to get there because one thinks NRDC has swept away the earlier ratio, but we have to face up to that.
CRENNAN J: Are you also registering a disagreement on the basis that general inconvenience has been subsumed in the grounds of novelty and inutility or is it only the swept away argument?
MR CATTERNS: I believe they have been subsumed.
CRENNAN J: Yes, I see.
MR CATTERNS: Yes, it has been subsumed in those grounds, inter alia.
CRENNAN J: Yes.
MR CATTERNS: I think that is our submission, your Honour, but as well as the point of its relationship to general inconvenience to which our friends point, of course, nevertheless their Honours do say the classification of certain methods as an inappropriate subject for grants - it is no more than a straw in the wind we would accept, your Honours, but we wanted to draw attention to it. Picking up the NRDC passage that his Honour Justice Gageler raised with me, if I may just go back to that because it is relevant to this question of purpose, their Honours were at page 263 in NRDC dealing with, in this context of a mere new use of an old thing whether you can have something that has the necessary quality of inventiveness though it is just a new purpose and I face up, as I think I said previously, their Honours say you can have and that is very clear, although it is a little bit double negative from what appears at the bottom of 263 which I will not read out again.
But their Honours said at 264 that you can have discovery without invention if there is no:
suggestion of a practical application . . . or because its application lies outside the realm of “manufacture”.
But in the instant case, as their Honours held, there was a suggestion of a practical application, namely the use for the purpose of killing weeds in crops. But, just looking at how we determine how a person infringes the patent in the NRDC Case as distinct what happens here, the primary infringement by the doctor. First of all, in the present case, if the doctor is treating or intending to treat rheumatoid arthritis there is no infringement. However, this drug is suitable for that and prescribed for that and they got an earlier patent for that, our friends, the patentees.
Secondly, if you are treating psoriatic arthritis, which is our conduct, which in the end, when I come to 117, it was held to infringe, but nevertheless if the doctor is somehow confined to be treating psoriatic arthritis there is no infringement because the claim says psoriasis. If it is psoriatic arthritis of the skin, however, there is infringement it seems. The methods are identical. The same medicine and the same dose. If your Honours would not mind going to volume 1 ‑ ‑ ‑
FRENCH CJ: When you say “psoriatic arthritis of the skin” you mean psoriatic arthritis associated with psoriasis?
MR CATTERNS: Yes, your Honour, yes. The other way around – I should have – psoriasis associated with psoriatic arthritis, yes.
FRENCH CJ: Yes.
MR CATTERNS: Yes, your Honour. I will come to the instruction that caused the problem later when I come to section 117, your Honour, and we are on time so far as time goes. At 472, under “Rheumatoid arthritis” at the bottom of page 472, under “Dosage and Administration”, under “Rheumatoid arthritis & Psoriatic Arthritis” there is a “Loading dose” to get you started of 100 milligrams, that is for both of them, five 20s or ten 10s, once daily for three days. Then at the next page at 473
The recommended maintenance dose for rheumatoid arthritis is leflunomide 20 mg once daily.
Not recommended for more.
The recommended maintenance dose for psoriatic arthritis is 20 mg once daily.
So the act that occurs at the state of the patient is the same, 20 milligrams. I skip to maintenance, 20 milligrams is administered. But the patent here attaches to what is in the doctor’s head when they are treating psoriatic arthritis and, as held here, some doctors – that was Dr Brooks – had in mind that it would be beneficial that the psoriasis be treated, that was held to be a primary infringement thereby giving rise to our secondary infringement, whereas in the case of Dr Brooks he did not - Dr Smith, I am sorry, Professor Smith, he did not. He focused on the joints, he said it would be an incidental thing, the treatment of the psoriasis.
Now, may I remind your Honours, this is our secondary argument. Our secondary argument is part of the reason that we say methods of treatment are not within the ambit of the concept is that it is very difficult to work out how to hold a doctor liable for his or her purpose.
CRENNAN J: Well, if the regimen is exactly the same you cannot prove infringement without knowing what the doctor was doing it for. Is that the way it works?
MR CATTERNS: Unless you prove infringement by us, by instructing it.
CRENNAN J: I am leaving aside the indirect infringement.
MR CATTERNS: Yes. Your Honour is right, with respect ‑ ‑ ‑
CRENNAN J: I am talking about direct infringement.
MR CATTERNS: Yes, exactly, your Honour.
CRENNAN J: Regimen is the same.
MR CATTERNS: Yes, your Honour, and that is why we have written in our written submission that the difficulties of having purpose based protection for medical treatment – the second medical use argument – it is insuperable. But we bring it back to our main argument and we say that is another reason why they are not within the ambit. If your Honours do not mind I was going to take the Court to a couple of findings of her Honour Justice Jagot which is relevant to the present point and answers your Honour Justice Hayne’s invitation, I think, but also is relevant to the section 117 point.
So her Honour’s reasons are in volume 2. There is just a few that – about five or six ‑ perhaps 10, I am sorry, that I will do quickly. At 496, your Honours ‑ ‑ ‑
HAYNE J: What paragraph?
MR CATTERNS: At paragraph 24, your Honour, they are “distinct disorders both in terms of aetiology and clinically”. Your Honours, at 35, page 499:
psoriatic arthritis as an “inflammatory arthritis associated with the skin disorder psoriasis –
Your Honours, at 523, paragraph 125, “different diagnostic criteria. One diagnostic” – sorry, I beg your pardon, that is rheumatoid and psoriatic – “One diagnostic element of PsA is (and in 1993 was) psoriasis”. Your Honours, at 129, page 524:
Rheumatologists have a basic understanding of psoriasis – in the sense that they know how to diagnose and treat psoriasis – because psoriasis is an element of PsA. Accordingly, a rheumatologist treating a patient with PsA will know how to treat the patient’s psoriasis as part of the treatment of PsA, either independently or in consultation with the patient’s dermatologist if the patient is also under the care of a dermatologist. However, if a patient has psoriasis alone or psoriasis in combination with a disease other than arthritis a rheumatologist would not consider it appropriate to treat the patient’s psoriasis. The rheumatologist would refer the patient to a dermatologist.
It is prescribed by rheumatologists. In 130, your Honour:
Leflunomide is a drug used in the treatment of RA and PsA and, for that purpose, is prescribed by rheumatologists. Leflunomide is not used in Australia for the treatment of psoriasis alone and is not prescribed by dermatologists for that purpose. However, if leflunomide is administered to a patient with PsA, that administration would be expected also to prevent or treat the patient’s psoriasis, to some extent at least.
Now, that would be an infringement on her Honour’s construction because that is the effect in fact. If it, in fact, treats the psoriasis her Honour held that was infringement. Your Honours, at paragraph 43 – and this is to illustrate the difference between two ‑ ‑ ‑
HAYNE J: What, infringement occurring when the patient’s condition improves?
MR CATTERNS: Yes, that is on her Honour’s holding, but the Full Court rejected that at first and, with respect, we submit drifted back into it on section 117 because it is the basis of the finding on reason to believe and instruction. Your Honours, these are the two passages that illustrate the difference in the approach between two doctors. At paragraph 43 on page 500, the question is asked of him, how effective is leflunomide on psoriasis:
I can’t answer that because I’m not a dermatologist and I don’t treat psoriasis except when it is in the situation of psoriatic arthritis, and, even then, I’m treating the psoriatic arthritis; I’m not treating the psoriasis. So I can’t honestly answer that question.
When you say . . . you are not treating the psoriasis, you are treating the psoriatic arthritis – I think that is what you said? Yes.
You mean you are administering the, let’s say, leflunomide for the purpose of treating psoriatic arthritis in that case? Correct.
The joint disease? Yes.
And if it has a benefit, as the TOPAS study suggests, in relation to the patient’s dermatological disease, that’s an incidental benefit? I am certainly pleased with the result for the patient, but that is not my primary aim of treating the patient.
Then, your Honours, in paragraph 51 – that was Professor Smith, called by our friends – and 51 is Professor Brooks called by us. There is a discussion about how basic or not his understanding of psoriasis was and he would not accept too much confinement of that. Then at about line 20:
You . . . would still describe your knowledge of psoriasis as being a basic knowledge of psoriasis? Yes, in terms of being able to diagnose it and treat it.
Then the last three lines of the next:
Because they are dealing with making a diagnosis of psoriatic arthritis, they need to be able to diagnose it almost as well as a dermatologist, and they need to be able to treat it almost as well as a dermatologist . . . as I said, rheumatologists need to know about psoriasis probably more than most other specialties . . . because they are dealing with a disease that crosses those two boundaries. [We] have to be able to diagnose psoriasis and know basically how to manage it, because otherwise how can they treat psoriatic arthritis.
Key part of the diagnosis –
the management of the psoriasis itself is not primarily, at least, the responsibility of the rheumatologist? No, it is not –
Your Honours, in the other volume is the passage of Professor Brooks’ evidence that went a little further in cross‑examination that is relied on in the ultimate findings. At page 99 of volume 1, transcript 287, after being shown the results in the PI which I will come to:
If you were prescribing leflunomide, following this PI, for a patient with psoriatic arthritis . . . you would expect the leflunomide to treat the psoriasis within the bounds of what has been put there?
That means to the moderate or reasonable extent shown in the clinical trial –
Yes.
So, as a rheumatologist, if you have a PsA patient coming to you with psoriasis, you have both treatments in mind, that is to say, the patient needs treating for both conditions; correct?‑‑‑Yes.
And in this case, following those indications within those boundaries, the administration of leflunomide treats both?‑‑‑Yes.
And if you are administering leflunomide in the context of that PI, you would be intending to treat both?‑‑‑Yes.
That is why we were held to infringe because Professor Brooks would infringe. In that same volume, your Honours, may I remind your Honours that this is a serious drug and it is by no means a first line therapy. It is, as Professor Brooks said in his affidavit at page 192, at paragraph 141 of his affidavit:
Due to the complex nature of Leflunomide, treatment is invariably initiated by a specialist rheumatologist. Once the patient is established on Leflunomide, maintenance –
doses from the GP –
. . . both in hospital and retail pharmacies.
The regulator has imposed a limitation on the prescribing of Leflunomide under the PBS.
Your Honours know that is the Pharmaceutical Benefits Scheme. You require an authority and the authority is in these terms, your Honours:
“Treatment of severe active rheumatoid arthritis where other disease modifying anti‑rheumatic drugs (including methotrexate) –
a chemotherapy drug –
are ineffective and/or inappropriate. Treatment must be initiated by a physician” –
your Honour sees that is the same for severe active psoriatic arthritis ‑
In other words, for me to be able to prescribe Leflunomide to a patient under the PBS –
doctors can prescribe off PBS and the patient pays the difference –
other disease modifying anti‑rheumatic drugs must have first have been considered and determined to be ineffective or inappropriate for the patient.
So, your Honours, in that milieu we submit it is a very difficult thing to be considering the purpose of – this is before I get to 117 – the purpose of a physician, and may I just draw attention to our written submission, our long written submission, where we deal with this as our second argument on our pages 12 and 13 where we say in our paragraph 50:
the determination of the proper scope of a claim “for preventing or treating” a given medical condition inevitably gives rise to questions of the purpose of the person administering the treatment.
and your Honours have seen the evidence. Then we quote Justice Dixon in something I have already shown the Court. In 51 we submitted:
independently from its primary argument concerning methods of treatment generally, that an invention limited by purpose is not patentable.
His Honour Justice Keane – or Chief Justice as he then was ‑ set out part of our argument, and we do not need to go to it, and that is the reference to the Merrell Dow Case that I mentioned where Lord Hoffman was commenting on the Mobil/Friction Reducing Additive Decision where his Lordship said that in the UK that decision had:
been criticised on the ground that a patent for an old product used in an old way for a new purpose makes it difficult to apply the traditional United Kingdom –
I submit, Australian –
doctrine of infringement. Liability for infringement is, as I have said, absolute. It depends upon whether the act in question falls within the claims and pays no attention to the alleged infringer’s state of mind. But this doctrine may be difficult to apply to a patent for the use of a known substance in a known way for a new purpose. How does one tell whether the person putting the additive into his engine is legitimately using it to inhibit rust or infringing by using it to reduce friction?
Your Honours, the reasoning of the technical boards of appeal that his Lordship set out are virtually impenetrable. Where you treat the new use as a new technical functional feature, it is really not the Australian patent discourse.
So, your Honours, returning to our little written three page outline, that takes us to paragraph 9, the submission I have just made. We have made the submissions in paragraph 10, and just to remind your Honours, in paragraph 11 his Honour Justice Wilcox’s reasons illustrate what we submit the fallacy of the argument that the legislature has failed to act, we submit that the position in 99 was as we submitted and the onus is, in effect, the other way around.
Your Honours, our submission 12, unless the Court would be assisted, we have given your Honours the full references to the position in New Zealand, the UK, Canada and Europe and the TRIPS agreement and as we have explained, under the US – and this becomes relevant on section 117 – there is a very special regime whereby the rival manufacturer, such as Apotex, only infringes if the indications for which they seek approval match the patented indication. So, in the United States we would not infringe because our indication is PsA, subject to the question of a double negative construction point.
An indication is the PsA. Our friend’s claim is psoriasis. We do not infringe in the US under the deemed infringement which is lodging an application for an approval where your indication matches the claimed indication. Under the law of inducement, as your Honours Justice Hayne and Justice Crennan in the Full Court and your Honour Justice French in the – I am sorry, in the High Court and his Honour the Chief Justice when he was in the Full Court explained the US doctrine of inducement would not lead to infringement.
That leaves us, your Honours, with the question of section 117 and if I could just remind your Honours of the provisions in section 117. I submit that enough has fallen from the Bench and our submissions about these questions of contributory infringement, the statutory contributory infringement is fundamental in the field of drugs and methods of treatment and it is of public importance, we submit.
It usually arises in the context of a quia timet interlocutory injunction because the – often settled by an agreement of the usual undertaking and submitting to an injunction – but under the Therapeutic Goods Act the usual thing is to notify the patentee, or else one way or another they find out because they have been keeping an eye on it under the therapeutic goods registrations or, as is often the case, the potential infringer moves to clear the way by moving first to attempt to revoke the patent.
In any event, it is going to be a section 117 case. Of course, our friends in fact do not sue doctors hitherto, but the Court made it clear in Collins that there are two things to focus on. One is the use of the product by a person that would infringe the patent, and we fought this case on the basis that this is the use by the doctor, so there is your primary infringement, and then there are the three types of use that are described in Collins which we were not going to take time with.
The Court agreed with her Honour Justice Crennan’s discussion of “staple” and we, if we may, adopt his Honour Justice Hayne’s description of (2)(a)’s only use, (2)(b)’s known use, and (2)(c)’s instructed use. The question of (c) we accept here relates to we lost on two bases. The first basis was her Honour’s construction which is when we indicate and give instructions for psoriatic arthritis, which we certainly did, in fact in most cases a person’s psoriasis will be treated or prevented.
Therefore, her Honour held that we came within (2)(c) or (2)(c) was attracted because our instruction was for psoriatic arthritis, not psoriasis. We gave an instruction for psoriatic arthritis, and when properly looked at, that is the fundamental reason we lost at first instance on both (2)(c) which says:
use of the product in accordance with any instructions for the use of the product –
Her Honour’s principal reason was that we gave instructions for psoriatic arthritis and that will, in fact, treat psoriasis, about which there was no dispute, but that construction was one of the crucial elements of the appeal. We said you cannot construe a method of treatment as claiming merely the effect in fact, treatment of psoriasis. For these to be tenable at all – though we say they are not tenable – you have to read the claim as with purpose in it. The Full Court agreed with us expressly but, nevertheless, upheld her Honour’s reasoning. Her Honour’s reasoning was based upon the effect in fact, as we respectfully submit, both with respect to (b) and with respect to (c).
We lost on staple and we did not appeal on staple – occasionally we wonder about that ‑ but it was held that we had reason to believe that they would put it to that use, the use being in the first case psoriatic arthritis where the effect will be, in fact, to treat psoriasis.
Can I make that good, your Honours? If your Honours would go to volume 2 please? Perhaps if I could just mention our overarching submission on this? As your Honour Justice Hayne explained in Collins Case, which we were not going to take time to go to, there is little room left for (2)(b) and, in fact, it seems to have been a little grace note added to what was intended by the recommendations and the government’s response even, and our submission is that the room there is for (2)(b) is that you have reason to believe when you indicate.
So, if you indicate PsA, that is what you have reason to believe. You do not impute to us some knowledge – and his Honour Justice French explained and this was upheld in the High Court, of course, it is objective, not the subjective knowledge on our part – you do not impute to us knowledge of Dr Brooks’ state of mind as opposed to Professor Smith’s state of mind.
So, your Honours, in paragraph 261 at page 581, this is our PI, and after some passages ‑ which I will quickly take the Court to in a minute ‑ which showed a clinical trial for psoriatic arthritis in which they also measured some but not all of the subject’s psoriasis score, PARSI, so there was a context where psoriasis was being treated beneficially. The statement of indications was our product:
Apo‑Leflunomide is indicated for the treatment of:
. Active Rheumatoid Arthritis –
no problem, that was not said to be an infringement –
. Active Psoriatic Arthritis –
and her Honour’s injunction, restrains from indicating active psoriatic arthritis. And then it said:
Apo‑Leflunomide is not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease.
Now, your Honours, there is no other truthful way, but we are obliged to give full truthful information about the effects of this drug.
FRENCH CJ: That is what indication in this context is a statement about, its utility in the treatment of these particular conditions?
MR CATTERNS: Yes, your Honour. Indeed, it is indicated for this purpose. Statins are indicated for the purpose of reducing our cholesterol; and perhaps we over‑simplify that as a double negative. At 593, answering your Honour’s question, his Honour the Chief Justice’s question, in paragraph – it begins on the earlier page – 286, her Honour the primary judge in paragraph 286 quoted section 7D which specified that we had:
to present a scientific, objective account of the medicine’s usefulness and limitations as shown by the date supporting the application . . . devoid of promotional material.
And including at the top of page 593 in (iii) details of the clinical trials, and (iv) indications, answering your Honour directly:
The therapeutic applications of the medicine.
So, your Honours, it was in that context that we gave that indication. By the way, our PI was a very close copy of our friend’s PI, which was held to be copyright infringement until the Therapeutic Goods Act was amended to provide that it was no longer a copyright infringement, as part of the intention of encouraging generic competition, we submit. Your Honours, back at 262, her Honour said on 581:
There was a debate between the parties about the meaning of the phrase “Apo‑Leflunomide is not indicated for the treatment of psoriasis that is not associated with manifestations of arthritic disease.” Sanofi‑Aventis submitted that the phrase means that Apo‑Leflunomide is indicated for the treatment of psoriasis that is associated with manifestations of arthritic disease.
We submitted you cannot convert the double‑negative into a positive. But, then your Honours see her Honour’s primary reason:
Given the undisputed evidence about the relationship between PsA and psoriasis, this point may be moot.
They occur together.
The evidence establishes that psoriasis is a diagnostic criterion of PsA. It further establishes that nearly every person with PsA has or will develop psoriasis. The evidence thus establishes that the administration of Leflunomide to a person with PsA –
which we undoubtedly direct, we give instructions for that –
will treat that person’s PsA and psoriasis (if they have a concurrent case of psoriasis) or treat that –
that is treat –
that person’s PsA and prevent psoriasis . . . Apotex’s approved PI, on any view, instructs a medical practitioner (namely, a rheumatologist) to use Apotex’s leflunomide product for the treatment of PsA. As almost all people with PsA have or will develop psoriasis –
So we instructed to do that irrespective of that phrase –
It does so by reason of the indication for PsA against the background of the undisputed evidence about the relationship between PsA and psoriasis.
So, your Honour, why is there is a primary infringement when we recommend PsA? The answer is: because the effecting fact is that they will be treated and that becomes clear in the next paragraph.
If the point is not moot –
Her Honour says, the double‑negative – if I may oversimplify – is unavoidable, and that is a fact we have to overcome, and we submit it is not for the reason I just gave –
can mean only that Apo‑Leflunomide is indicated –
We submit not, it is saying it is indicated for PsA, and having already told the practitioner that there will be an effect on psoriasis, saying it is not indicated for psoriasis simplicita. Then your Honours, in 263, that is ‑ ‑ ‑
CRENNAN J: But is an indication meant to indicate efficacy as distinct from a contraindication which will be an adverse effect?
MR CATTERNS: Yes, it is, your Honour, yes, it is. That is what is indicated for. That is why you put, as your Honour knows, all the clinical trials and you are registered with the therapeutic goods under the Therapeutic Goods Act for indications for which it has efficacy – safety and efficacy.
FRENCH CJ: So a statement that it was not indicated for psoriasis would be a false statement.
MR CATTERNS: Not indicated – no, but it would be true because we do not have a ‑ ‑ ‑
FRENCH CJ: In terms of efficacy.
MR CATTERNS: But your Honour, we do not have a – under the strict rules of the TGA we have not obtained regulatory approval to indicate use for psoriasis.
FRENCH CJ: I am just talking about the substance content of the statement. If you were to say this drug is not indicated for psoriasis, you would be making a statement about its efficacy or lack of efficacy, would you not, or lack of proven efficacy?
MR CATTERNS: Your Honour, it would be lack of approved – so it is saying you are not an approved indication because the TGA takes into account efficacy and safety and there may be many reasons why it might be efficacious – a horrible example is thalidomide – why it might be efficacious for one purpose but highly undesirable for another.
CRENNAN J: This sentence, I assume, was not copied from the other product information?
MR CATTERNS: Yes, it was.
CRENNAN J: It was.
MR CATTERNS: Yes, your Honour. This is not a pleading point taken for the first time in the High Court but it is instructive to see the way the case was put against us in volume 1 at page 21. We had no trouble meeting the arguments that were put, I hasten to add, but page 21 the way it was initially pleaded at least, paragraph 44, this is our infringement under section 117:
Apotex intends to supply and offer to supply in Australia [our products] for the treatment of active psoriatic arthritis.
Then they in particular:
(ii)The Apotex PI states that the Apotex Leflunomide Products are “indicated for the treatment of . . . Active Psoriatic Arthritis” -
which is the positive indication that I took the Court to. Then, your Honours, there is what we call the effect in fact in 45:
The use by a person of the Apotex Leflunomide Products for the treatment of active psoriatic arthritis would infringe claim 1 –
Particulars (i), (ii), no problem:
(iii)When an effective amount . . . is administered to treat active psoriatic arthritis, it will prevent or treat the skin disorder psoriasis.
Our reason to believe that was the infringement by the doctor in 45. Then they are not staples. Then in 47:
Apotex intends, and has reason to believe, that the Apotex Leflunomide Products will be used –
as indicated in the Apotex PI. Then can I also refer to 48 to 50, your Honour.
CRENNAN J: Do we have the Sanofi product information document in that?
MR CATTERNS: Yes, we do, your Honour. Her Honour quotes their indications at 507.
HAYNE J: What paragraph?
MR CATTERNS: I will give your Honours the paragraph in a second. That is our friends’ indication, your Honour, paragraph 61. I believe it is the same. Our friends’ PI is in fact in the back of the book in volume 1, beginning at 430, and the colouring in is the copying, as usual in the copyright infringement part of a case.
Your Honours, at 438 is the indication in our friend’s – various contrary indications. May I draw attention to the passage – it is the same as in ours – that relates to this PASI. It is at 437, where under the heading of “Psoriatic Arthritis” there is discussion of improvement in your joint disease, which is what the rheumatologists are focusing on, we submit, but also some of the patients, we see at line 30, were assessed to see about the:
changes in the extent and severity of psoriasis lesions –
under the PASI scale, and that showed a definite benefit. So there was no dispute following that study that when you were treated with leflunomide for psoriatic arthritis, your psoriasis would be threated or prevented. We submit that the only truthful way to say that it is indicated for PsA but not indicated for psoriasis that is not associated with PsA, that is the only way to say that. So, your Honour, in one ‑ ‑ ‑
CRENNAN J: Well, claim 1 does not refer to PsA.
MR CATTERNS: Not at all, your Honour, it is the only claim, it does not. But we are liable for that, partly, we submit, because of what her Honour described as the link between psoriatic arthritis which we undoubtedly recommend, indicate, and psoriasis, which co‑presents, if that is the right word, and it will in fact treat their psoriasis. So, your Honours, on the same basis in 263 her Honour says:
It follows from this analysis that Apotex has reason to believe that the person to whom the product is supplied (by inference, a rheumatologist . . . ) will put Apotex’s leflunomide product to use for the treatment of psoriasis, and so that the condition is s 117(2)(b) of the Patents Act is satisfied . . . In this regard it is apparent from the findings and analysis above that is not the case that Apotex’s leflunomide product merely might treat psoriasis in a percentage of patients with PsA. The evidence . . . cannot be so characterised. On their evidence, the administration of an effective amount of leflunomide to a person with PsA will in fact treat or prevent psoriasis, albeit with variable degrees of success . . . From this it follows that Apotex has reason to believe that Apotex’s leflunomide product will be used in a method of preventing or treating psoriasis as claimed in claim 1 of the patent.
Now, your Honours, we thought, and we submit we were right to think, that if we overcame that construction, in fact treat or prevent, we would win on section 117, always having to overcome the double negative, but the reasoning on section 117(2)(c) was based on our instruction for PsA.
CRENNAN J: Hypothetically, you could lose the argument about the exclusion point but win this argument.
MR CATTERNS: Yes, your Honour. It is an important point of principle, still, because the relationship of section 117(2)(b) to indications is very important in our joint commercial fields – (2)(c) speaks for itself. But, your Honour, we submit finally on (2)(c), before I come to the Full Court, where we submit in short that their Honours were with us on the question of construction and therefore, subject to the double negative, should have found no infringement, nevertheless, we lost on infringement.
CRENNAN J: Is Sanofi selling this product both pursuant to their patent rights in claim 1 and otherwise as well?
MR CATTERNS: Yes, your Honour.
CRENNAN J: That is where the copyright infringement presumably became important because there was no monopoly in relation to the use of the compound for PsA.
MR CATTERNS: Exactly, your Honour, nor for rheumatoid arthritis.
CRENNAN J: Or RA, yes.
MR CATTERNS: But your Honour saw the pleading. It was pleaded that if we sell it for PsA we will in fact treat psoriasis and therefore first the doctor will infringe and then us.
CRENNAN J: This is Justice Jagot’s construction of effect.
MR CATTERNS: Yes, exactly, your Honour. May I go to his Honour the then Chief Justice. At page 698, paragraph 27 – this is where his Honour mentioned the question of where purpose is involved and the method of treatment, but at line 29 he said I do not need to deal with that:
because I have come to the conclusion that the claim in the patent, properly construed, does not extend to the application of leflunomide as a method of treating PsA merely because that treatment will inevitably have some incidental beneficial effect on psoriasis.
So he is rejecting her Honour’s finding. I should have said, your Honours, without going back to it, her Honour’s finding was in paragraph – her ultimate effect in fact‑finding was at 155, page 536:
the claimed method is used where the compound (leflunomide) is administered to a recipient in an effective amount so that the recipient’s psoriasis is in fact prevented or treated.
That is in paragraph 155. So, his Honour Chief Justice Keane there says – his Honour recites that in the first sentence of 28:
with the result that psoriasis is in fact treated even though the product is administered as a method of treating PsA. Her Honour held that the use of leflunomide by a medical practitioner to treat or prevent PsA would infringe the patent because that use would necessarily have the effect of also treating or preventing psoriasis.
His Honour says that:
was relevant to, but not decisive of, the issue of infringement –
His Honour quotes in paragraph 29 the four constructions. The first one is, as it were, a subjective construction which I confess we flirted with. The second was at paragraph (2) which was objective purpose, “to prevent or treat psoriasis”. The third in paragraph (3) ‑ ‑ ‑
HAYNE J: What does that mean?
MR CATTERNS: Well, your Honour, I respectfully share your Honour’s difficulty, but his Honour Justice Keane gave it a – we submitted that was the only way you can construe it and it means Justice Keane said ‑ ‑ ‑
HAYNE J: Well, accept for the purposes of argument that you are right to say it is the only way you can construe it. What does it mean when you construe it that way?
MR CATTERNS: Well, we said you have to look at, in effect, the doctor’s notes; that is what Justice Keane said, Chief Justice Keane, in paragraph 37. He said in 37 ‑ your Honour, we share your Honour’s apparent concern about this, if I may be so bold. We submit this is the problem. Anyway, in 37, “the construction ‑ ‑ ‑
HAYNE J: Telling me there is a problem is one thing; I would like to know what your solution to the problem is.
MR CATTERNS: Well, your Honour, we submit the only possible solution to the problem is that you construe it as an objective purpose. Perhaps what Justice Keane says in 37, which we advanced, is:
That method necessarily presupposes a deliberate exercise of diagnosis and prescription by a medical practitioner.
We submit, so far as section 100, that then goes – you match that up with the indications that we give. So looking at the NRDC Case, your Honour – and that is what we took as our model because that was a case, as I said ‑ ‑ ‑
CRENNAN J: It was a purpose case.
MR CATTERNS: Exactly. There you can see that there was a person, a farmer, with the backpack with the two kilograms per acre, spraying the weeds.
CRENNAN J: In a sense, purpose is used as distinct from effect in those contexts when a compound is known.
MR CATTERNS: Yes, exactly, your Honour.
CRENNAN J: That is what is accepted widely, that purpose is the relevant way in this area of discourse to describe an effect because to use the word “effect” would give too wide a monopoly.
MR CATTERNS: Yes, your Honour.
CRENNAN J: I think, in fairness, that is probably what Justice Keane was referring to when he said “objective purpose”.
MR CATTERNS: Yes, your Honour, we urge this ‑ ‑ ‑
CRENNAN J: He meant nothing different from a purpose that was enough in NRDC.
MR CATTERNS: Yes, your Honour.
CRENNAN J: It is just grappling with the problem of a new use.
MR CATTERNS: Yes, your Honour.
FRENCH CJ: What is the difference between subjective and objective purposes? Is one the purpose you actually have and is another an attributed purpose and, if so, on what basis?
MR CATTERNS: Well, your Honour, that is why I confess we, in our arguments ‑ as her Honour Justice Jagot pointed out – did not always sufficiently distinguish between constructions (1) and (2) on that page there. It is a very difficult thing to get right, with respect, when we are talking about what a doctor is doing. His Honour Justice Keane said in 44, just picking up what her Honour Justice Crennan said – perhaps…..construction, but:
The exclusion of a patentee’s competitor from trade is commensurate with the right of exploitation . . . The extent of the patentee’s right –
and our exclusion –
is marked out by the novelty which gives the invention its potentiality. The primary judge’s construction of the claim would allow the respondents to exclude their competitors from an area of trade –
psoriatic arthritis –
which does not involve exploitation of the novelty claimed by the patent.
The pages at 263 to 264 of NRDC that his Honour Justice Gageler drew to my attention illustrate that point.
HAYNE J: Let us come back to NRDC and let us understand better than I obviously do the facts of that case. I understood NRDC concerned a compound that was a general broadleaf herbicide, known to be a general broadleaf herbicide. Is that right?
MR CATTERNS: Yes, your Honour.
HAYNE J: It was found that it could be used in a fashion that would become a selective weedicide, and it would become a selective weedicide because of the manner in which the plants reacted to it.
MR CATTERNS: Yes, your Honour. I am not sure about weedicide versus herbicide.
HAYNE J: Or as it would previously kill all broadleaf – thought to kill all broadleaf plants or plants generally.
MR CATTERNS: The good as well as the bad so to speak.
HAYNE J: Yes. It was discovered that it could be selective in its operation. Is that right?
MR CATTERNS: Yes, your Honour. That was their discovery. Their discovery was that the weeds broke the compound down to acetic acid that killed the weed.
HAYNE J: Yes, and if you went higher up the scale, into butyric acid and so on, et cetera.
MR CATTERNS: Yes, your Honour.
HAYNE J: We are here concerned with psoriasis which is at least associated with psoriatic arthritis. What is the analogy that is being drawn by Chief Justice Keane between NRDC and this case in the language used?
MR CATTERNS: I am not certain his Honour was drawing an analogy there, your Honour. I think it was I who was saying that the ‑ ‑ ‑
HAYNE J: Well, leave aside authorship, what is the analogy that is at stake?
MR CATTERNS: Merely that if a method of treatment of this type, which was our second argument, is patentable at all it is because of the new purpose because this is admittedly a known drug, so this is a use for a new medical purpose and that gives it a novelty, an inventiveness, ex hypothesi, over the prior disclosure of the compound itself. So, therefore the claim is limited by, or defined by, purpose so as to distinguish it from the prior disclosure of the compound itself. I face up to, your Honour, an analogy with NRDC where there the claims that we see at page 261 were themselves, as we read it, limited by the purpose of eradicating weeds from crop areas. I suppose I wish NRDC’s claim were not limited by purpose, by I think I faced up to that at first. Just on the construction point, his Honour says in 45:
Here the monopoly claimed . . . is a process of treatment involving a deliberate process of diagnosis and prescription directed to the treatment or prevention of psoriasis . . . one should be slow to construe a patent –
just as a “reason of consequences”. Your Honours, then his Honour said at 46:
For these reasons, I consider that the patent, on its true construction, would not be infringed by the application of leflunomide upon the prescription of a rheumatologist to prevent or treat PsA.
That is why we thought we would win if we won on that construction, but his Honour held from 52 onwards, in particular 54 in the passages we have quoted, 262 to 263:
By reason of the primary judge’s findings of fact . . . one must conclude that the supply by the appellant of its generic leflunomide product for the use by rheumatologists in the treatment of PsA would infringe the patent ‑
which we cannot reconcile with paragraph 46, with respect:
[We] instructed the use of leflunomide in the treatment of psoriasis which is associated with PsA . . . On that basis, s 117(2)(c) is engaged. The appellant’s instruction also means, for the purposes of s 117(2)(b), that the appellant had ample reason to believe that medical practitioners would put leflunomide to use as a method of treating psoriasis which is associated with PsA.
Your Honours, in particular in paragraph 55, his Honour, in effect, puts aside the double negative question – not disagreeing with it but puts it aside – says:
But her Honour’s reading of the [product information] was not the only reason for the findings of fact –
that we took your Honours to –
. . . And, in any event, it is enough that the appellant’s PID instructed the use by a rheumatologist of the product to treat psoriasis in combination with PsA for the patent to have been infringed. Use of the product in accordance with that instruction would mean that the product is being used to prevent or treat concurrent cases of psoriasis. That would be so even if the sole object of the rheumatologist’s treatment was PsA.
Then his Honour looks at Professor Brooks’ evidence that I took your Honours to. So then his Honour says in 57:
In summary, although the claim in the patent is for a method of treating psoriasis, the appellant had reason to believe that its leflunomide product would be used to treat or prevent PsA.
That can only be either because of the effect in fact that it will treat or prevent the psoriasis that is associated with it or because, as Professor Brooks says, he would have it in mind that as a good thing, even though he is prescribing this for the PSA, it will treat the psoriasis. Your Honours, that is even clearer, with respect, in the reasoning of their Honours Justices Yates and Bennett, where their Honours reject her Honour’s construction, paragraphs 122 and following at page 728 to 729. In 124, their Honours reject the construction. I should have gone above. I was looking at our submission which is why I took the credit for the objective construction:
In our view the construction . . . which was accepted by the primary judge, gives it a field of operation . . . that exceeds the description of the invention in the body of the specification, on which the claim purports to be fairly based –
namely, psoriasis. Then, your Honours, at the top of page 730, halfway through paragraph 125:
This new method of treatment, as a patentable invention, can only be realised or expressed through the deliberate administration of leflunomide to prevent or treat psoriasis.
Your Honours, we say treat PsA, and that is how it was pleaded. I accept our friends relied on the double‑negative and there is no problem about that. So we respectfully submit that when one has that construction we cannot infringe under section 117. Their Honours conclude the construction in paragraph 128 on page 730, which I do not need to take time with. At page 733 in paragraph 139, their Honours refer to the primary judge’s finding that when we instruct them to treat PsA:
it necessarily instructs rheumatologists to use the product to treat psoriasis, independently of the express reference to psoriasis in the document.
Your Honours, we respectfully submit that there is no way that you can read an instruction in terms of section 117(2)(c) as some implied instruction because the paragraph says “use of the product in accordance with any instructions”. The fact that you happen to know that these people will have the additional complication, we submit, does not answer it. Your Honours, I will not take any more time except just to draw your Honours’ attention to paragraph 149 where their Honours note Professor Brooks’ evidence,
which, quoting from paragraph 51, which I have taken the Court to, and then her Honour’s findings we see at the top of 736, paragraph 150, I took the Court to these paragraphs, 129 and 130. Then their Honours quote Professor Smith’s evidence that I took the Court to, where he says, I am treating the joint disease, that is in 151.
This evidence reflects differences in opinion and clinical approach . . . The fact that these differences exist does not mean, however, that the primary judge’s findings as to Apotex’s “reason to believe” were in error.
Well, I submit they were based on the effecting fact approach, and we are left in a very strange position when, in particular, two doctors have a completely different approach to it. Then finally, your Honours, in 154, we accepted that it “was based on reasoning”, this is at the top of page 737:
limited to the finding that administration of leflunomide to treat PsA would inevitably treat or prevent psoriasis –
Then their Honours go back to what I have called the “double‑negative” –
cannot be read as an arid instruction that is unrelated to an acknowledged reality that rheumatologists, like Professor Brooks, do seek, and will seek, to treat both constitutes when patients present with PsA and psoriasis concurrently.
Well, your Honours, we submit we only have reason to believe that they will treat PsA, and when people are acting in accordance with out instructions they are acting in accordance with an instruction to treat PsA. Your Honours, the Trade Practices Case I think is agreed on – that is I hope it is – stands or falls on the section 117 argument as it did below. May it please the Court.
FRENCH CJ: Thank you, Mr Catterns. Yes, Mr Jackson.
MR JACKSON: Your Honours, may I deal first with the appeal and then go on to deal with the application for special leave. Your Honours, in relation to the appeal, the central question of course is whether a method of treatment of the human body is patentable or, if one puts it around the other way, are such claims excluded from patentability? In our submission, if I could put it very broadly to commence our submission is that the patent in this case was validly granted when it was granted in 1996 and that the legislative changes which have occurred since then confirm that the view then adopted remains the case.
Your Honours, may I indicate a little more fully the course which we would seek to follow in dealing with this issue. The first thing we would say, your Honours, is that prior to the decision in Re C & W’s Application, there does not appear to have been an instance where there was a judicial determination that a method of treatment was not within section 6 of the Statute of Monopolies. Your Honours, whether Sir Stanley Buckmaster’s decision was one that would in Australian terms be treated judicially or otherwise does not seem to matter very much. Nor, your Honours, does it appear that there was any judicially expressed view, at least, that the ambit of section 6 of the Statute of Monopolies was as narrow as that which was taken in Re C & W’s Application.
In that case - and your Honour, I will come to it in more detail a little later – he decided against the patent on two bases. The first was that the process was not something to be used in the making of an object of commercial value or a process to that end. The second was that it related simply to medical treatment. Your Honours, as to the first of those bases that cannot, in our submission, stand consistently with the Court’s decision in NRDC, and as to the second basis, or your Honour, perhaps I should say, which does rather seem more declamation than explanation, once the view is taken that methods or processes may be patentable one asks why are processes of medical treatment excluded.
Your Honours, the position in Australia, in our submission, is that there are no decisions of the court which decide the issue. Rather, the decisions in the court are observations which avoid deciding it, and for good reason. The decision in NRDC, in our submission, left the matter for further decision, so too did Joos, and that was that further decision can be seen in the reasoned decisions of Justice Gummow, at first instance in the Federal Court, and then the two decisions of the Full Court and the Federal Court, and the legislature has acted consistently with those decisions in its amendments to the Patents Act.
Could I just say this, your Honours? The position was not, in our submission, established in Australia, as our learned friends argument would have it at the time of the 1990 Act. The report of the Industrial Property Advisory Committee recognised that there were difficulties in identifying what limits should be put on the concept of method of manufacture in section 6 and left it to the courts to develop what the notion should be as, your Honours, it was noted in their observations, in the committee’s observations, the courts had moved to develop these things.
The third thing, your Honours, a matter of quite some importance, in our submission, is that when the Patents Act came into force in 1990, your Honours will see there was section 18(2) which created a specific but limited exception to the ambit of the power to grant patents in subsection (1), and your Honours will also notice that subsection (1) is preceded by the words “Subject to subsection (2)”.
So that, your Honours, if one looks at, in a sense, the heart of the matter in sections 18(1) and 18(2) your Honours will see that there is nothing apart from, no doubt our learned friends would say, section 6 itself to limit the scope of section 18(1) except for the reference to section 18(2) which contains the specific but limited reference to things – if I could put it neutrally – relating to the human body.
Now, your Honours, the amendments which have followed with the Patents Act indicate that the view adopted in the cases in the Full Court of the Federal Court are views which, in our submission, the legislature has adopted, and we refer particularly to section 119A to which I will come. Your Honours, could I go first to the decisions of this Court and in the course of doing so may I refer to Re C & W’s application?
Your Honours, what we would say emerges from the decisions of this Court is that the Court, no doubt rather prudently, has avoided deciding the question until the time has arisen for it to do so, and it had not arisen directly for decision in any of the cases but, your Honours, the dicta in the cases in this Court recognise that there has been an approach taken that claims of this kind may not be patentable, but equally there has been a recognition that the basis for that view is not immediately apparent.
Your Honours, could I turn first to the decision in Maeder v Busch (1938) 59 CLR 684? Now, your Honours, that case involved a patent for a process of producing permanent waves in human hair on the head. It had been held invalid at first instance by reason of prior common knowledge and prior public user. You will see that referred to at page 698, point 6, by Chief Justice Latham. The first sentence of his Honour’s reasons. His Honour at page 699, point 4, agreed with those views of the trial judge, but then went on to say what your Honours will see as at about point 6 on page 699, he said it was unnecessary to:
deal with the interesting and important question –
Your Honours will see set out there, he said:
Such a claim is, of course, quite different from a claim relating to an appliance or a substance which may be used upon or in connection with the human body. I am very doubtful whether such a method or process can itself be regarded as a “manner of manufacture” –
Your Honours will see the last sentence of that paragraph, and it seems, could I say two things about it. First is that the last sentence, we would submit, makes it very clear that his Honour was not seeking to express any concluded view on the topic, and the second thing is that the reference at 699, about point 7, to “method or process” does suggest that his underlying view was that methods or process claims could not be the subject of patent, and that was changed, we would submit, by the Court’s decision in NRDC. Justice Dixon referred to the issue at page 705, about point 2, where your Honours will see he said that the claims were to a:
mere process consisting in the application of well‑known chemical compounds and heat to the hair, a part of the human creature, [and that raised] a serious question in relation to subject matter.
You will see, your Honours, in his discussion going through to about point 9 on page 705, that it all related to, as he said at 705, about point 9, “method, procedure, treatment or process”, and of course, things have moved on since then. Could I just note in passing, your Honours, that Chief Justice Dixon was part of the joint reasons for judgment in NRDC and that decision, if I may say so, with respect, does not, we would submit, leave extant much of the views that he expressed in Maeder v Busch. Could we go back, your Honours, to page 706, about point 2? You will see that at about point 2 he said that the human hair was “part of the human body”, and that:
hitherto none of the prosthetic processes by which any of its participates have been treated has been considered [as proper] subject matter for a patent.
He referred to Re C & W’s Application, and in discussing with that at about point 7 on page 706 he recognised, your Honours, that:
The purpose of the patentee and those intended to employ the process may be entirely commercial.
But he went on to say - and this seems to be the matter upon which his decision or his view seemed to turn, about point 8 on the page:
But the object is not to produce or aid the production of any article of commerce. No substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence by means of or with the aid of the process.
Your Honours, as is apparent from the last paragraph, his reasons on page 706, his Honour did refer to:
a widening conception of a manner of new manufacture has been a characteristic of the growth of patent law.
He proceeded to deal with a memorandum that had been handed up, but then your Honours will see at page 707 at the conclusions of his reasons:
I prefer to leave undecided the question whether a process for treating the hair may be patentable.
Now, your Honours, Justice Evatt at page 707, about point 7, found a difficulty with the notion that the process on a human being was not a patentable process. Justice McTiernan at page 708 did not express or did not need to resolve the doubt whether it was a manner of new manufacture. Your Honours, I am sorry to have taken a little while in taking your Honours to those passages. What does emerge from them, in our submission, is that it is clear that all the dicta about process in relation to the human body were obiter and your Honours – I will come to it shortly – will see that Chief Justice Barwick made that observation in Joos himself.
Your Honours, the views expressed were heavily based on the notion that a means or process could not be the subject of a patent and that was something that NRDC, in our submission, showed was not the case. Could I come to that case now, your Honours? The Court was there considering an appeal which had been from the Commissioner of Patents to a single justice of the Court, but then your Honours will see towards the bottom of page 253 had been directed to be argued before a Full Court. Your Honours, that no doubt was a reflection of Chief Justice Dixon’s views in the earlier case that the matter was one that had not yet been decided by this Court.
Your Honours, the decision of the Commissioner of Patents had been to refuse the patent for a method of eradicating weeds from crop areas and the method, your Honours heard, comprising the application of a herbicide of a particular character. The Commissioner had refused to accept the patent on the basis that the method did not produce a vendible product. He also relied in the Court on the contention that the method was in the area of horticulture and agriculture which fell outside the scope of patentable subject matter.
Now, your Honours will see if one goes to page 269 at about point 8 on the page the Court said that:
The right question is: “Is this a proper –
I will come back to the word “proper” in a moment –
subject of letters patent according to the principles which have been developed for the application of s. 6 of the Statute of Monopolies?”
Now, your Honours, “proper” is perhaps a word that is not necessary in what their Honours said. They are really saying is there something which is the subject of letters patent? Now, obviously some kind of value judgment lies behind that but what your Honours will see is if one goes further up the page commencing at about point 4 on the page that their Honours say the inquiry is not so much into the meaning of the word as to the development of the concept. I will not read it out because your Honours have been taken to that passage already but your Honours will see what is set out there. That resulted, as your Honours will see, in the views expressed at page 277 at about point 1 where their Honours said at the first line:
the view which we think is correct in the present case is that the method the subject of the relevant claims has as its end result an artificial effect falling squarely within the true concept of what must be produced by a process if it is to be held patentable.
I will not read it out but your Honours will see the remainder of that rather long paragraph in which there is a reference to in the last few lines:
It achieves a separate result, and the result possesses its own economic utility –
What your Honours will see, in our submission, is that that decision made it apparent that processes could be the subject of patents and if one looks at point 6 on page 277 it also made it clear that agricultural and horticultural processes could themselves be patentable. Could I take your Honours to the conclusion at page 279 about point 6 where there is a reference to:
We are here concerned with a process producing its effect by means of a chemical reaction –
Your Honours will see the remainder of that paragraph. Your Honours, could I go back for a moment then to page 270 where one sees at the bottom of the page, about point 8, the observation in relation to the human body, where it said:
The need for qualification must be confessed, even if only in order to put aside, as they apparently must be put aside –
There is a reference to the two earlier cases –
processes for treating diseases of the human body –
But your Honours will see that in relation to that passage that the issue of human body did not arise in the particular case, there was no need for the Court to determine the issue and, your Honours, insofar as there is a reference to Maeder v Busch, that is a reference to a case in which the issue was not decided.
Your Honours, the point in NRDC was that the assumed need for there to be tangible goods or a vendible product went and in those circumstances, your Honours, the question might well be asked, why were medical treatments to be excluded, but those for crops or livestock included unless there were to be some ethical, moral or some other basis referred to?
Your Honours, in cases where one is talking about treatments for the human body the kind of processes, legal processes I mean, contemplated by NRDC are ones which are clearly applicable and as applicable, in our submission, as they are in relation to treatment of crops or livestock or anything else. Could I come then, your Honours, to the third decision of the Court, and that is Joos v Commissioner of Patents (1972) 126 CLR 611. Now, your Honours, this was ‑ ‑ ‑
FRENCH CJ: You would say that absent any sort of normative or moral or ethical boundary there is no reason for exclusion of medical treatment because it is part of the process genus?
MR JACKSON: Yes. It is a means or process, your Honour. If one looks at it first of all, if I could put it this way, generally, if one looks at it generally one sees that there has been over time a growing ability to do things that are thought likely to improve the human condition of at least those who are ill or potentially ill, and in relation to those the work of identifying and proving and having approved processes of that kind is one which is really no different, apart from the fact that it is in relation to the human body, than would be the case if one were doing it in relation to any other area of interest. Indeed, your Honours, the fact that it is dealing with the human body gives extra point to it in a way because of its importance and the difficulty there may be of obtaining approvals and matters of that kind.
CRENNAN J: It is hard to see any logical distinction between a medical product and a medical process in terms of what is the principle that is going to divide the two in terms of patentability?
MR JACKSON: Your Honour, it is very difficult, if I may submit so, with respect, to find such a distinction. Why is the pill patented but not the process to be adopted with the pill? What is the benefit of ‑ ‑ ‑
CRENNAN J: The distinctions seem to be there between an ailment and something that was not an ailment, but not a very satisfactory distinction, which I think Mr Catterns conceded.
MR JACKSON: The difficulty, your Honours, is that if one is looking to find in the decisions why should this be, it is a little difficult to identify it. Your Honours, that is why I submitted earlier that if one looks at Re C & W’s Application, one sees there more a declamation than an explanation, if I can put it that way. May I come to Joos first, your Honours, and then ‑ ‑ ‑
HAYNE J: Just before you do, before we depart from NRDC, it is perhaps of interest to note the way Mr Aickin put the point at page 254 at about point 7.
MR JACKSON: I am sorry, the point on the page, your Honour?
HAYNE J: Point 7, where Mr Aickin said:
The primary object of the invention is to provide means for eradicating weeds in areas sown with useful broad‑leaf crops which cannot satisfactorily and economically be treated with herbicidal compositions hitherto known. What is claimed is a manner of new manufacture, viz., the use of these compounds in that selective fashion –
It is of interest that he goes on to say –
It is an agricultural process producing a commercially useful result.
Now, I think your argument must be, must it not, that although that may have been an apposite proposition to advance in the case it is not necessary?
MR JACKSON: I am sorry, your Honour, the ‑ ‑ ‑
HAYNE J: The “agricultural process producing a commercially useful result”.
MR JACKSON: Your Honour, there are two aspects. The “agricultural process” describes the case, it does not limit it. The “commercially useful result”, your Honour, is not an essential aspect of it, but it produces a useful result which is capable of being dealt with in the very broad commercial sense.
HAYNE J: I think it was advanced by Mr Aickin in that case in the context of the discussion that is later reported about, the significance of vendible product.
MR JACKSON: Yes.
HAYNE J: I at least read the argument as saying “commercially useful result” is the heart of what is being spoken of in connection with vendible product.
MR JACKSON: Your Honour, I think that is right, yes.
HAYNE J: But am I right to think that your argument entails that that is – I was going to describe it as an unnecessary flourish. As I say, something apposite to NRDC, but not essential.
MR JACKSON: That is so, your Honour, because Mr Aickin was dealing with a different situation, and the situation he was dealing with was one where there was a notion that there had to be tangible goods or, in effect, a vendible product, variously expressed, and he was saying, your Honour, it does not have to be a product. There can be a means or process ‑ ‑ ‑
HAYNE J: Hence the reference in the third or fourth last line to the two half‑truths, one of which was the vendible product.
MR JACKSON: Yes, your Honour, but what we are saying is that all that one needs to establish is that there is a means or process which results in something that otherwise satisfies the requirements of section 18(1) and is not excluded by 18(2). The commercial aspect, of course, comes in if one is discussing the desirability of these things being patentable, and that is an aspect of it, but the commercial result is by itself not an essential aspect of it, in our submission. Your Honours, may I go to Joos v Commissioner of Patents? That was an appeal from a decision of the Commissioner of Patents to refuse to accept a patent for a method of treating human nails and hair. Chief Justice Barwick at page 616, about point 2, posed the question:
whether a monopoly may be granted by letters patent for a process for treating human hair and nails attached to and growing on the human body.
Your Honours, he accepted at point 7 on page 616 that the appeal must proceed on the basis that the method in issue did not produce or improve a vendible product, but he went on to say, your Honours will see:
But that is not to deny that the process has economic virtue or significance in the relevant sense.
At the bottom of that page he referred to the NRDC Case as a watershed decision. In our submission, that was correct. There is no doubt about that, we would submit, and at the top of page 617, he construed it as standing for the proposition that:
It is enough that the process has a commercial application.
That was his Honour’s view of things. Your Honours will see that ‑ ‑ ‑
GAGELER J: Does that mean anything more than that the process itself can be commercially – well, is saleable, in a sense, or does it require something more?
MR JACKSON: Well, a commercial application, your Honour – and with processes you can have various kinds of application. They can be used by the patent holder or used by the person with a patent holder’s licence. The concept of commercial application seems to involve, as used by his Honour, that at least you could do something with it and get something from it ‑ in money terms, I mean. You will see that he was doing that and he said immediately in connection with that in the next sentence:
Consequently, as the law now stands, the absence of any evidence in this case that the use of the process would result in . . . a vendible article is in itself not fatal –
so he using a contrast, I think, your Honour.
CRENNAN J: Something that is useful will often have economic significance.
MR JACKSON: Well, almost always, your Honour.
CRENNAN J: Almost always.
MR JACKSON: Yes, it may well be that some articles simply home manufacture for use at home might have no commercial application, but very ‑ ‑ ‑
CRENNAN J: I meant having utility in the patent sense.
MR JACKSON: Yes, your Honour, yes. Almost everything that one would expect is capable of having a commercial application, it may be successful, it may be not, but it is capable of having the commercial application. Your Honours, if one goes to page 617, about point 7, your Honours will see that in the paragraph commencing “Passages from this Court’s decision in Maeder v Busch were cited”, his Honour said about five lines into that paragraph:
The passages are well known and there is no need to recite them. What is there written is clearly obiter and was unnecessary to the decision of the case.
Your Honours, he went on to quote Sir Owen Dixon as there accepting:
the view that it was necessary . . . that a “substance or thing forming a possible subject of commerce or a contribution to the productive arts is to be brought into existence –
but, your Honours will see that he refers to the fact that ‑
“the question whether a process for treating the hair . . . ”was left undecided.
Your Honours, if one goes to page 618, about point 8 on the page, you will see in the paragraph commencing, “Reference was made in the N.R.D.C. Case to Maeder v. Busch”, and he goes on to say:
that was no more than a passing reference not intended to be definitive.
Your Honours will see that he referred in several passages to the patentability of methods of treatment but, in our submission, it is clear that he was not expressing any concluded view and, of course, if there were any view adverse to us it could not be binding on your Honours in a court of five. What your Honours will see was that at 619, about point 2, he said:
For the purpose of deciding this question it may be granted that a process for the treatment of the human body . . . is not a proper subject matter for the grant of a monopoly under the Act. It is not essential to the decision of this matter to controvert that proposition or to discover and express its basis in law.
Your Honours will see that he was specifically not deciding the issue. Your Honours, that goes through to – around to that paragraph. I was going to take your Honours to page 621, about point 9 on the page, when you will see that he referred to the decision of the Tribunal in:
Schering Aktiengesellschaft for a monopoly for a method of contraception by the administration of a particular gestagen in a defined dose.
Your Honours will see that he refers to the reasons given by the Tribunal, and then at the bottom of that page said that:
Their Lordships constituting the Tribunal seemed content for the purposes of the case before the Tribunal, to allow that the practice of the Office in refusing a patent for a process for the medical treatment of the human body was sustainable though lacking in any demonstrable logical basis –
Your Honours will see the remainder of that sentence. Then at page 622, about point 8, you will see:
if it be accepted that process claims for medical treatment of human disease, malfunction, disability or incapacity of the human body or of any part of it cannot satisfy the requirements of an invention under the Act, the class of such claims should be narrowly defined.
Then, at page 623, about point 4 on the page:
In my opinion, it does not fall within the class of medical treatment which, for the purposes of this case, may be taken to be an inappropriate subject to the grant of letters patent.
Your Honours will see then he referred to the possibility of being “generally inconvenient”. Again, your Honours, that certainly is not a decision which decided that the law in Australia was that claims of this kind were not to be allowed. Could I take your Honours to the decision that was referred to there, Shering AG’s Application [1971] RPC 337. Your Honours may not have that. Could I give your Honours copies of it?
Your Honours, as appears at page 338, about point 4 on the page, the hearing officer, Mr Walton, had held that the claim could not be allowed and the Patent Appeal Tribunal had – I am sorry, your Honour, I got it wrong - the hearing officer had held that the claim could not be allowed and the Patent Appeal Tribunal in the end rejected the application but your Honours will see – one commences at page 339 in the reasons for judgment of Justice Whitford – commencing at the bottom of the page at about line 36:
The superintending examiner has held that the applicants are not entitled to this claim. His decision is based on a practice enshrined in the Patent Office Manual of Practice –
which is then quoted and he said:
The Act now in force does not say this in terms, nor did any preceding Act. If the practice is right – and it has been established practice for over 50 years – it must be based upon this: that such processes have never qualified as inventions, as “manners of new manufacture” within section 6 –
Your Honours will see then on page 340 in the second new paragraph:
It may be thought surprising that the definition of “invention” in 1971 should still be based upon words in a statute of 1623 –
There is a reference then to NRDC and the quotation from that decision, and then your Honours will see the next paragraph:
For the applicants, the case was argued upon the broad basis that it raises the question of the patentability of research into the unknown properties of known pharmaceutical compounds . . . an important question –
Then the argument in the next paragraph, line 34, should there be no patent protection in the medical field at all and his Lordship said:
In this country, however, it has long been recognised that persons producing new pharmaceutical substances or curative devices can secure patent protection for them.
Your Honours will see a reference to proposed abolition of section 41, and then your Honours will see at the bottom of that page a reference to it saying:
It is no doubt sensible that a person who is able to produce a substance which, for example, would cure or prevent cancer should, subject to safeguards, be offered a limited monopoly as a reward –
Your Honours will see also, “it is a little difficult to see” in the third line on page 341:
why someone who by research effort devises a new method of using a known substance to achieve equally beneficial results should be denied patent protection.
There is a reference in the next two paragraphs to Re C & W’s Application and your Honours will see, if I could go to about line 32:
Today it is plain that a process or method to be patentable does not necessarily have to result in the making of an object of value or be a process adapted to that end . . . the electronic field would never have been granted. Though the test of “vendible product” may often be a useful test, it has long been accepted that it is not a conclusive test which must be passed if a patent is to result.
Then at the bottom of the page, your Honours, referring to the observation in C & W about human medical treatment, it is said:
It is to be observed that the Solicitor‑General does no more than endorse what appears to have been represented to him as being the Office view on that case. The case does not establish that this was Office practice at the date. It does not appear from the report that the point was argued on the appeal . . . There are no reasons given to support the view that even at the date of that case this was a valid ground for refusal.
Your Honours will see that if one goes then to the next paragraph, in particular about line 17:
It is interesting to observe the use of the words “as they apparently must be put aside” –
This is from NRDC –
which would appear to indicate some doubts in the minds of the High Court as to the logic of doing this. It is also interesting to observe that the High Court in Australia equate “medical treatment”, referred to in the C. and W. case, with “treating diseases of the human body.”
There is a reference then to the NRDC Case. Your Honours, at the top of page 343 your Honours will see their Honours saying:
Although it is difficult to see any logical justification for the practice in relation to processes for medical treatment, if the object of the system is in truth to give hope of a reward to people whose research and industry results in valuable products or processes, it does appear –
Then it said Parliament seems to have worked on the basis that you could not. Your Honours will see at page 344, commencing about line 13, again the reference to NRDC and the comprehensive and lucid discussion in that case. Then, your Honours, on the same page, about line 37:
The argument that a process for the treatment of disease must excluded from the patent protection may seem illogical, but it is undoubtedly strongly supported by the terms of section 41 –
to which there is some discussion. Your Honours, then at page 345, about line 25, the law as it stands should be allowed to proceed. Now, your Honours, your Honours will see that the Tribunal, perfectly correctly, did not regard the reservations, such as they were, in Maeder v Busch, and in NRDC as being in any way decisive. Your Honours, I do not think I need to actually take your Honours to it, but your Honours have been taken to paragraph 34 of the Advanced Building System Case 194 CLR 171, the observation there made is really very much in passing, it is perhaps hardly likely to be otherwise, as Justice Gummow was a participant in the joint reasons. Could I come back for a moment, your Honours, to Re C ‑ ‑ ‑
GAGELER J: Sorry, Mr Jackson, were you going to say something about the Upjohn Company Case from 1977?
MR JACKSON: Yes, your Honour. Could I just say this about it, your Honour? The decision in that case, which is [1977] RPC 94, does have, with respect, its somewhat curious elements. One is, if your Honour goes to page 98 at the conclusion of the judgment, it is said:
Nevertheless . . . it is well established that a method of treatment of a human ailment with a known substance is not capable of being an invention under the statute –
Your Honours, on the previous page, notwithstanding the observation to “well established”, it is said at about line 7 –
there is no actual High Court decision in this country.
There is a reference to Schering at about line 12 or 13 on page 97, but there is no reference at all to the doubts about the logicality of the exception expressed in that case. You will see at the end of that paragraph, about line 23, a reference to NRDC, and your Honours, that, with respect, is not a fair reading of what was held in NRDC. It is a possible view, I suppose, but it just is not what NRDC decided or, perhaps I should more accurately say, did not decide. Your Honours, if one goes to page 96 in that decision, you will see at about line 28:
Now it is admitted for the appellant that it has always been the view of those professionally concerned with patent law that such a method of treatment is not within the definition of “invention” –
et cetera. Your Honours, the ultimate result may be communis error facit jus. But your Honour, what it seems to be – may I put it this way?
The decision in Upjohn is one which says this is the English practice, in effect, right or wrong, we are going to say it is still the practice. Now, it may, your Honours, be based in part on the compulsory licensing provision in section 41. That may be some justification for it, but, your Honours, that is what we want to say about the case, it does not really affect the present case, in our submission.
Your Honours, could I come back to Re C & W’s Application for a moment in (1914) 31 RPC 235? Your Honours will note at page 235, about line 35, the passage that goes through to 236, about point 12 on the page, and your Honours will see the reference to “newly made” or improved manufacture, and in particular lines 8 to 11 on page 236, and then on the same page, about line 18, the references to human bodies and the last three lines:
I notice that the Patent Office have based their refusal on the ground that the alleged invention relates simply to medical treatment, and I think that the foundation for that refusal is sound.
Now, your Honours, of the two reasons the first was too limiting; the second does not, with respect, have any logical basis, it is a view that might be taken, but it is a view, in our submission, that is simply stated without there being a true basis for the view, whichever emerges.
Your Honours, may I go then to the decisions in the Federal Court? They arose in circumstances where this Court had not decided the issue. One of the grounds on which an opposite view might have been taken had been set aside by the Court and a new approach indicated. The other approach, namely that which one sees in, for example, the passage in C & W to which I have just referred, does appear to be, with respect, somewhat light on in the description of the reasoning underlying it.
Now, your Honours will see from the Federal Court cases, in our submission, that they provide a line of decisions which contains substantial reasons in favour of the patentability of methods of human treatment of the kind presently in question. May I go to what is the starting point, in effect, and that is the decision of Justice Gummow in Rescare v Anaesthetic Supplies Pty Ltd (1992) 111 ALR 205?
Your Honours, could I go to the following aspects of it. At page 233 under the heading, “Methods of medical treatment of the human body” at about line 31. Your Honours will see at about line 40 that his Honour refers to the effect of the NRDC Case, namely:
it is not essential for the grant of a monopoly for a process that the use of the process should produce or improve a vendible article. It is enough that the process has a commercial application.
You will see at page 234 that his Honour referred, at the top of the page, to the practice of the Australian Patent Office’s Patent Examiner’s Manual. The relevant portion of that he said was in evidence and there was a reference to Joos’ Case. I am going to give your Honours a reference. May I do that in the morning to save the time of doing it now, but could I, having
said that, just go a little further down the page, halfway down the page, to the extract from the Industrial Property Advisory Committee’s recommendations.
The quotation commences at about point 7 on the page and your Honours will see that the discussion there involves the proposition to which I adverted at the commencement of our submissions that there would be considerable difficulties in endeavouring to identify what are particular exceptions, et cetera, from the ability to patent. Your Honours will see, if one goes to the top of the next page at about the fifth line it was said:
We consider that the existing concept operates quite satisfactorily. It has the advantage of being underpinned by an extensive body of decided case law which facilitates its application in particular circumstances. At the same time it has, in the past, exhibited a capacity to respond to new developments. To replace it with a codification would be likely to produce far more problems, with attendant costs, than it would solve.”
If I could pause at that point, your Honours, the point that is being made is that at the time when Parliament legislated, some six years later, the position was that the recommendation was one that looked to the future. It recognised there might be new developments in relation to what was contemplated by section 6 of the Statute of Monopolies. The law at the time in decisions which this Court had not said were binding on it was not being fixed in aspic at that point. Your Honours, I see the time. I expect to be about another hour and a half to two hours.
FRENCH CJ: Yes, thank you, Mr Jackson. The Court will adjourn until 10.15 am tomorrow morning.
AT 4.16 PM THE MATTER WAS ADJOURNED
UNTIL WEDNESDAY, 29 MAY 2013
- AGLC
- Apotex Pty Ltd ACN 096 916 148 and Sanofi‑Aventis Australia Pty Ltd and Sanofi‑Aventis Deutschland GmbH and Aventisub Ii Incorporated [2013] HCATrans 123
- Case
- [2013] HCATrans 123
- Decision Date
CaseChat Overview and Summary
The High Court was required to determine whether Sanofi's patent was valid and, if so, whether Apotex's proposed product infringed that patent. Central to the dispute was the interpretation of the patent claims and the assessment of whether the product manufactured by Apotex fell within the scope of those claims, considering the doctrine of equivalents. The validity of the patent also hinged on whether it met the requirements of novelty and inventive step in light of prior art.
The Court's reasoning involved a detailed analysis of the patent specifications and the relevant provisions of the *Patents Act 1990* (Cth). It applied established principles of patent law concerning claim construction, infringement, and validity. The Court considered the evidence presented by both parties regarding the technical aspects of the pharmaceutical products and the prior art. The application of the doctrine of equivalents was crucial in determining infringement, requiring an assessment of whether Apotex's product achieved substantially the same result in substantially the same way as the patented invention, despite minor differences.
The High Court ultimately found in favour of Sanofi, upholding the validity of the patent and finding that Apotex's proposed product infringed the patent. Consequently, the Court made orders restraining Apotex from infringing Sanofi's patent rights.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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