AstraZeneca AB & Anor v Apotex Pty Ltd; AstraZeneca AB & Anor v Watson Pharma Pty Ltd; AstraZeneca AB & Anor v Ascent Pharma Pty Ltd

[2015] HCATrans 107

[2015] HCATrans 107

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S54 of 2015

B e t w e e n -

ASTRAZENECA AB

First Appellant

ASTRAZENECA PTY LIMITED

Second Appellant

and

APOTEX PTY LTD

Respondent

Office of the Registry
  Sydney  No S55 of 2015

B e t w e e n -

ASTRAZENECA AB

First Appellant

ASTRAZENECA PTY LIMITED

Second Appellant

and

WATSON PHARMA PTY LTD ACN 147 695 225

Respondent

Office of the Registry
  Sydney  No S56 of 2015

B e t w e e n -

ASTRAZENECA AB

First Appellant

ASTRAZENECA PTY LIMITED ACN 009 682 311

Second Appellant

and

ASCENT PHARMA PTY LTD ACN 118 734 795

Respondent

FRENCH CJ
KIEFEL J
GAGELER J
KEANE J
NETTLE J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON THURSDAY, 14 MAY 2015, AT 10.01 AM

(Continued from 13/5/15)

Copyright in the High Court of Australia

____________________

FRENCH CJ:   Yes, Mr Catterns.

MR CATTERNS:   May it please the Court.  Your Honours, it arises from transcript, might I just make one brief submission on section 7(3) before finishing off on the one authority I wanted to go to on a manner of manufacture.  Your Honours, we have made our submissions of how we got to Watanabe via section 7(3), and we have made our submission about the impermissibility of further searches of arriving at non‑CGK documents when we are in 7(2).  Then, as her Honour Justice Kiefel pointed out, there is then a factual question of us coming to the ultimate invention, and as his Honour the Chief Justice pointed out, it is not just a question of saying – it is not just a question of apples and oranges and commonly known doses.

Your Honours, the references in our paragraph 7, which I will not go to, are our references in relation to that ‑ paragraph 7 of our oral handout ‑ in particular, the primary judge’s findings, which I took the Court to, where her Honour makes the finding on the ultimate question.  I did not take the Court to his Honour Justice Jessup’s more detailed analysis of that precise question based on the evidence, but we give your Honours the reference there.  I took the Court to most of the evidence of Dr Reece that we refer to there.

In those first paragraphs he explained – this is when he has got a hypothetical issue which, of course, is the landscape we are in ‑ he explains what he would do with the design of pre‑clinical trials, including animals, and in vitro, and clinical trials.  That gave him an expectation in a statin market where there are similar drugs, structurally similar drugs, with similar mechanisms of 5, 10 and 20 milligram doses.  Then your Honours saw the searching he did, the relevance that he ascribed or attributed to Watanabe.  At paragraph 175, which I took the Court to, he said having seen Watanabe, that would not change my expectation of 5, 10 and 20 being appropriate doses to try. 

Then the extent of the cross‑examination on that is the passage that our learned friend took the Court to in full, which is the last of our references there and we respectfully submit of course he said you do not, as it were, mechanistically jump to the same doses as other statins but he explained it is a more complicated process, but nevertheless that provided a good foundation, together with the evidence our learned friend, Mr Ryan, will go to from Professor O’Brien for the concurrent findings of fact that we rely on.  Your Honours, then on manner of manufacture ‑ ‑ ‑

FRENCH CJ:   Just before you move onto that, it is just an incidental question of fact, I suppose, connected with a question I raised about dosage – I do not want to overemphasise its importance – when one talks about statins one is talking about a class of compounds that are defined by reference to a particular effect.

MR CATTERNS:   Yes, your Honour.

FRENCH CJ:   I think that is right, is it not?

MR CATTERNS:   Yes, your Honour.

FRENCH CJ:   They are not necessarily defined by reference to structure, although there may be structural similarities because the effect is – the effect being the binding to the substrate which stops the enzyme going in and producing them ‑ ‑ ‑

MR CATTERNS:   The molecule has a shape, et cetera, your Honour.

FRENCH CJ:   ‑ ‑ ‑ mevalonic acid or whatever it was called, yes.

MR CATTERNS:   Yes, your Honour.  That is exactly right, your Honour.  Watanabe, in the doses that they gave, that we see, to the dogs and the monkeys, we can see that we were dealing with some parity of dosage.  That was one of the factors that we submit is relevant.

Your Honours, the last case in our paragraph on manner of manufacture, which is paragraph 11, is Lockwood (No 2) 235 CLR again.  These are some paragraphs that our friends also refer to in their answer to our argument on this.  Your Honours, may I remind your Honours that there at paragraphs 106 and 107 ‑ ‑ ‑

FRENCH CJ:   It helps if you give the page numbers.

MR CATTERNS:   I beg your Honour’s pardon - page 211, your Honour.  Sorry, your Honour, paragraphs 106 to 107.  Your Honours, the context here was not manner of manufacture but it was an obviousness case – by this stage purely an obviousness case and the Full Court had described what they called an implicit corollary admission in the specification, the inventive step being the corollary of the admission.  There was this problem…..sort of thing.  The problem was the key did not unlock the deadlock.  The implicit corollary admission was that the key should unlock the deadlock.  But, your Honours, in that context the Court nevertheless – in the context of admissions which begins at 105, the Court referred to matters that we accept are relevant to some extent on manner of manufacture.

In 106 their Honours refer to the Chapman and Cook Case, referring to a recital in the specification, so to speak, reciting oneself out of court.  Their Honours say:

Chapman may be understood as a case which exemplifies a specification showing “on its face” that an invention did not involve an inventive step ‑

which is the proposition we asserted yesterday, your Honours –

The expression derives from Commissioner of Patents v Microcell Ltd, which stands for a narrow proposition that a Commissioner . . . may refuse an application for patent protection where a specification “on its face” shows the invention claimed is not a manner of manufacture.

We submitted yesterday that is not confined, and there was no logical reason it should be confined, to the state of application for patents as distinct from revocation.  Their Honours say:

This may arise, for example, from admissions concerning novelty.

It does not involve a separate ground of invalidity or a discrete threshold test.  We submitted yesterday, your Honours, and took the Court to a passage where the Court in Microcell said this is not just a question of admissions.  Your Honours, the question of threshold test is whether or not there is a separate ground in the chapeau to section 18 where it uses the word “invention” as distinct from 18(1)(a).  We base our argument on 18(1)(a).  Then, your Honours, still in that context their Honours refer to Lord Hoffman’s remarks in Biogen v Medeva:

that there may be cases where the alleged subject matter is “so obviously not an invention that it is tempting to take an axe to the problem by dismissing the claim”.

We are not suggesting that that should occur, your Honours, but as I submitted yesterday, her Honour Justice Jagot did hold that one of the other patents in suit failed this test on that ground.

Your Honours, there is a footnote (177) to the UK Genentech Case, where Lord Justice Mustill said – I will not take the Court to it – that such a case – there are cases where, on the base of the specification the patent should fall at the very first hurdle.  The Court then goes on to describe the limited case of admissions in the specification being relied on on a case of obviousness.  We submit that what we can get from Lockwood v Doric is that there is a class, a category of cases, where a specification shows on its face that there is no inventive step. 

Your Honours, that takes us to our final topic, which begins in our paragraph 12, and by contention.  This is the topic that has been called the starting point argument.  We now prefer to regard it as one of characterisation or identification of the invention or the inventive concept and we respectfully submit that her Honour Justice Jagot’s analysis of that, explaining that there are some cases – in not every case is this kind of analysis appropriate – but there are some, and this is one of them.

Your Honours, as we have just seen from the manner of manufacture cases, the court or the Commissioner does look at the specification as a whole, on its face, in determining the manner of manufacture question under section 18(1).  Your Honours, that is true of several, at least other grounds of invalidity.  The obviousness ground is the one that we are talking about now.  But, your Honours, for section 18(1)(c) utility the question is whether something within the claim fails to deliver the promise that is made in the body of the specification.  That – even though the section 18 says:

an invention that, so far as claimed in any claim –

of course, we would test it against the body of the specification.  Your Honours, without taking the Court to them, our main written outline, paragraphs 56 and 57, refer to his Honour the Chief Justice’s discussion in the University of Western Australia v Gray Case, where amongst many other issues his Honour dealt with a question of entitlement.  His Honour discussed the question of the inventive concept described in the specification in the context of entitlement. 

So, your Honours, in looking at that question, which is another ground of revocation under section 138, one looks at the entirety of the specification.  His Honour the Chief Justice referred to the Kimberley‑Clark Case – a sufficiency case – where various possible meanings of the invention were discussed, including, relevantly, the embodiment which is described and around which the claims are drawn.

Your Honours, in our paragraph 58, in that same section of our submissions, we refer to the High Court’s discussion of inventive concept in Lockwood (No 2), it being part of the UK approach to obviousness where step one of the structured approach in the Windsurfing Case, or the Pozzoli Case – they are referred to in Lockwood – is to identify the inventive concept. 

Of course, your Honours, a paradigm example of what – sorry, your Honours, the paradigm example of when one looks at the specification is to see whether a specification complies with - section 40 has the duties of a specification, of course.  It must fully describe the invention – section 40(2)(a):

including the best method –

By 40(2)(b):

a claim or claims defining the invention –

By 40(3):

The claim or claims must be clear and succinct and fairly based on the matter described in the specification.

All of those involve – perhaps, the question of – even the question of defining, I am sorry – treating the document as a whole.  Your Honours, section 40(4) is not a ground of invalidity, but a patent is examined for compliance with section (40)(4) which says:

The claim or claims must relate to one invention only.

If there is more than one invention in a patent, the Commissioner compels the applicant to split it into multiple inventions.  So, what we have in any patent is a single invention defined in various ways in claims.  But there is, as it were, a broader overarching concept of the invention that is being described.  In answering the current question you do not, we submit, quarantine the specification and look only at the claim.  There is one invention which has to be patentable so far as it is claimed.  I will come to the detail of our submissions in a second, your Honours.

Your Honours, it would be unrealistic, we submit, and contrary to what we have just discussed – the understanding of the specification as a single coherent document – not to derive the inventive concept or the invention from the specification as a whole.  Here, of course, truthfully, the specification makes no suggestion that the inventors invented rosuvastatin or discovered its utility for hypercholesterolemia.  The descriptions and the claims are all about a particular method of treatment using defined dosages of this drug which they start with, with its known formula, and its known utility.

Your Honours, of course, there may be cases – and her Honour Justice Jagot pointed this out – where the inventor truthfully says I have remembered this from a dream – and something completely new.  A problem solution analysis is entirely inapposite.  The very conception of this possibility of a new thing or perhaps a new improvement starts from scratch.  But in others, very commonly, the inventor says “I propose a solution to the following problem”. 

While the High Court in Alphapharm and in Lockwood, as it were, confine the problem solution approach that their Honours say is apparently mandated in Europe, their Honours, nevertheless, adopt a problem and solution approach.  Your Honours, in such a case where the patentee/applicant/inventor says my invention is the provision of a solution to this, that is what is to be assessed. 

Your Honours, if I could now, in our three‑page outline – in our paragraph 12 our submission is that the inventive concept is to find dosages of rosuvastatin with greater efficacy and similar safety profile.  That is to be determined from the specification as a whole.  It is not the invention or discovery or selection of rosuvastatin and this is a case, as her Honour Justice Jagot said, where a problem/solution approach is apt. 

I do not need to take the Court to the patent again as I have already taken the Court to the patent.  Those paragraphs in Lockwood v Doric are ones that his Honour the Chief Justice referred to in relation to inventive concept and I have mentioned the sections of the Act.

Your Honours, our proposition 13 takes us to the Alphapharm Case and, we respectfully submit, there is no question that the Court adopted the approach for which we advocate and the differences between the Act which the Full Court in the present case emphasised did not detract from the relevance of the Alphapharm Case.  Your Honours, I can do this quickly because I have been to it several times too.  Your Honours, it is 212 CLR.  Your Honours, at page 415, there is the argument, as both sides have said in their submissions – all sides – that the patentee put it the way that we are putting it.  I am about a third of the way down the page after footnote (13) referring to the Amoxycillin Case: 

The hypothetical skilled worker is taken to know the nature of the problem to be solved.  The Court wrongly assumed that the formulator is taken to have known the contents of particular documents not shown to be part of common general knowledge.

Your Honours, the structure of the Court’s reasons shows that they adopted that approach so that they took the nature of the problem as the starting point, being very careful to say you do not have access to documents that are not common general knowledge in passages I took the Court to yesterday, including his Honour Justice Lehane’s error.  If I can skip for a moment, your Honours, to the last third of the page:

The notional addressee is to be told the nature of the problem but is not provided with information not part of common general knowledge . . . It is up to him to see whether he can work out a formulation given the characteristics of omeprazole. 

Justice Gaudron – I beg your pardon – “not be given a copy of the compound patent” because it was not common general knowledge:

Is not the nub of the case –

Her Honour asks –

how you formulate the problem to the national addressee?]

He says:

The problem is how do you formulate omeprazole, given its physical and chemical properties.

The drug was not common general knowledge, your Honours.  Your Honours, I only need to go to a couple of paragraphs.  Your Honours, in paragraph 2 at page 418, their Honours refer to the patent “in suit”.  They note that the drug itself, omeprazole, was first synthesised in 1979.  There was a compound patent not in suit, not common general knowledge.  Then, your Honours, we see the problem:

The discovery of omeprazole and the grant of the compound patent was not itself sufficient to bring about the commercial exploitation of the compound by oral dosage.  This was because the compound was not easily formulated into a satisfactory pharmaceutical composition.  There was a problem in the administration of the drug which was answered with the formulation claimed in the Patent ‑

That is a problem solution ‑

The problem had several aspects.

The short point was, your Honours, that omeprazole was very susceptible to degradation in acid labile.  You want to get it through to the intestine, the duodenum, where it is going to be absorbed.  How do you get it through the stomach?  Commonly, one added an enteric coating which survived the acid of the stomach, but the omeprazole was so acid labile it was going to react with the coating – its own protective coating.  The solution, to put it crudely, was an intermediate layer which protected it.  That is described in paragraph 5.

Your Honours, in paragraph 41 after a discussion of the English problem and solution approach, as we can see for example in 40, and making it clear that that is not always the appropriate approach, the Court says in 41:

In any event, the consistory clause in the Patent states that the invention claimed therein is designed to obtain a pharmaceutical dosage form of omeprazole which answers the problems referred to earlier –

which your Honours have seen –

in the body of the specification and indicated earlier in these reasons.

Then we see it is a combination patent.  So, your Honours, the Court did more than just proceed on the basis of a concession in argument and, as the Court said in the paragraph I noted in paragraph [34] to the Firebelt Case, in such a central issue the Court would not proceed on a concession unless it thought it was correct.  Your Honours, of course it is clear – and I do not need to go back to it – this is in a context where the Court is insisting on the 3M rule as we saw in paragraph 43 that I took the Court to yesterday, the holding for which Minnesota Mining is celebrated.  So, your Honours, that is a case that of course the Full Court followed in the Apotex v Sanofi Case that our learned friend the Solicitor‑General also refers to in his submission.

Our paragraph 14 in effect is an assertion of a negative.  One does not find in Minnesota Mining and Wellcome a statement that you – what they do do is they say you cannot have resort to publications that are not common general knowledge in assessing inventive step ‑ we readily agree – but they do not establish that the problem candidly and fully described by a patentee is not an appropriate starting point for one’s analysis.  So I can skip over that, your Honours, to paragraph 15.

Her Honour Justice Jagot, the primary judge, correctly identified the invention here.  As her Honour pointed out, the alternative approach would allow multiple derivative patents.  In each case the applicant for the patent would be able to call in aid the reinvention or rediscovery of rosuvastatin which is not novel – it was published in the 471 patent, clearly ‑ and with trivial additions such as the present doses which are conventional, the particular medical indication ‑ and there could be many more indications – or the particular dosage form which encompassed titanium dioxide in the coating which is in every tablet to make it white.  So we submit that her Honour’s reasoning on that was right.

May I just briefly – and this is the last territory – go to her Honour’s reasons and make a sentence or two about the Full Court’s reasoning.  Her Honour’s reasons at volume 5 are at – her Honour begins at 207, page 1888.  Your Honours, I was not going to read this in any detail, but commend it to the Court, with respect.  Her Honour points out, with respect, that this is a case by case issue and our submission is that is right but this case before the Court now is a case for which this kind of analysis is apposite.  In 209 her Honour quoted Justice Bennett in the Danisco Case:

“[a]scertaining a starting point is particularly apposite where the specification is drafted to describe a problem and a solution to that problem.

In other words, the terms of the specification and claims inform the identification of the relevant starting point –

That accords with Alphapharm or Aktiebolaget, as her Honour says in paragraph 211.  You look at the terms of the whole patent leading up to 214.  We would embrace, with respect, what her Honour says in 215:

references to the correct “starting point” and the “problem‑solution” approach, expressed at the level of principle, are not particularly helpful . . . close attention to the terms of the specification is required in order to characterise the invention.

That is our submission, your Honours -

The relevant comparison is between the invention and the prior art base –

The invention so characterised and the prior art base.  Your Honours, 216 is an argument that we are not running before this Court.  Then her Honour proceeds to characterise the inventions in 219 and 220.  In particular, her Honour says:

the invention as claimed to be compared with the common general knowledge.  The invention is defined by the terms of the patent.

Our friends’ position that the invention can somehow include discovering the existence of rosuvastatin is inconsistent with the terms of the patent.  It is clear from the – I am skipping, your Honours –

the terms of the specification as whole that . . . The inventive concept is in the dosage range alone.  So much is plain from the opening paragraph of the specification.

Your Honours, again I commend the following paragraphs.  Her Honour does a similar analysis with patents not in suit but significant and helpful, as we respectfully submit, at 224 to 227.  But there cannot be the rediscovery of the invention.  Her Honour’s conclusion is, in 228, that:

Comparison between the inventions as claimed and the version –

which underlined our friends’ submissions -

exposes the discrepancy. 

On our friends’ case, for each of the patents, in slightly different ways -

the invention becomes, or includes, discovering rosuvastatin . . . when the claimed invention –

claimed and described, I would say:

suggests no such thing.

Your Honours, we respectfully submit that analysis is correct.  The error - and this is my final topic, your Honours – in the Full Court’s reasoning begins at 200, but the nub of it, your Honours, is at 202.  Their Honours, with respect – I beg your pardon, at page 2488, your Honours.

Their Honours, as it were, take the argument ab initio without a great deal of attention to the way her Honour dealt with it, and in particular the paragraph 202 mischaracterises the argument and the way her Honour put it.  That mischaracterisation is a fatal flaw that underlines two or three of their Honours’ reasons in the following paragraphs, which is, if I can go just part point 40 on page 2488:

it is apparent that the relevant provisions of the Act do not expressly or impliedly contemplate that the body of knowledge and information –

which we all agreed is CGK in section 7(3) –

may be enlarged by reference to the inventor’s (or patent applicant’s) description in the complete specification of the invention including, in particular, any problem –

Our argument is this is not enlarging the common general knowledge, perhaps, added to by 7(3), but just to make it simple, this is not a question of enlarging the CGK, this is taking the specification on its terms. 

Your Honours, the premise that you cannot enlarge the CGK is in effect the assumption that underlines the subsequent paragraphs.  In effect, their Honours beg the question – they assume the truth of the proposition – that the problem has to be CGK or else one cannot rely on it. 

Your Honours, that is the case with respect to paragraphs 204, we submit, and 206, and I think 207.  We all agree in paragraph 205 that it is not what the inventor himself or herself in fact did in terms of their inventive journey.  Of course it is subjective.  Your Honours, 208 is a different point, and that is a matter of reading page 1 of the specification.  Your Honours say of course there might be debate – well, of course there is always questions of construction, that is no answer.  But, the way their Honours read the problem in 208 is:

Is it possible to devise a new method for the treatment of (i) hypercholesterolemia –

Of course the problem described in the specifications is more specific than that, your Honours.  There are two versions given.  We have made our submission.  It is about finding dosages for rosuvastatin, the agent.

Your Honours, the criticism of Sanofi, in paragraph 216, again is based on the premise stated in 202 that if the problem is not common general knowledge, it cannot be considered.  Their Honours also, with respect, misread – or perhaps inappropriately confine – Alphapharm in paragraphs 218 to 219.  So, we respectfully submit that the analysis of her Honour the primary judge characterising this invention as being the solution of a problem, to wit, finding the dosages of rosuvastatin, is correct.  May it please the Court.

FRENCH CJ:   Thank you, Mr Catterns.  Yes, Mr Ryan.

MR RYAN:   May it please the Court.  Your Honours, I hope your Honours have our three‑pager.

FRENCH CJ:   Thank you, yes.

MR RYAN:   Your Honours, I do not wish to repeat what Mr Catterns has said and, that being so, I can skip the first four paragraphs of the outline and just go to propositions 4 and 5 under the heading of “Obviousness”, perhaps proceeding in reverse order.  Our proposition at paragraph 5 is that each of 471 and Watanabe disclosed rosuvastatin as a useful treatment for hypercholesterolemia and provided a sound basis to adopt a starting dose of that treatment of 5 to 10 milligrams.  Your Honours, can I make that good by going to the evidence of Professor O’Brien.  First of all, his affidavit material at volume 4, behind tab 75 ‑ ‑ ‑

FRENCH CJ:   And the page is?

MR RYAN:   Your Honours, just before I get to the detail of it, without labouring through his qualifications, he is an extremely distinguished endocrinologist and academic and, amongst other things, he has himself been involved in a number of clinical trials, including clinical trials concerning statins.  So if your Honours would not mind looking at page 1299 at paragraph 3.6, he indicates there he has:

been involved in a number of clinical trial involving statins.  Trials in which [he] was involved prior to 2000 included a number of studies on simvastatin and atorvastatin . . . [He] was involved in a clinical trial that compared atorvastatin with simvastatin in approximately 1000 people ‑

He says later in that paragraph he ‑

had a great deal of clinical control.  This involved assessing the efficacy of simvastatin and atorvastatin in patients . . . [and it] compared identical ranges of doses of the two drugs in order to determine their respective effects on cholesterol levels.

He points out that he published a paper about that trial, and then also deals with a number of trials concerning the statin simvastatin at the Austin Hospital prior to 1991.  Now, your Honours, if we could then turn to page 1325 at paragraph 13.1, he indicates that he was given by Mallesons what he describes as “the First Problem” which he exhibits and which the Court was taken to yesterday.  Our friends at AstraZeneca had an issue with the problem posed to Professor Reece, but they have indicated there is no such problem with what O’Brien had to deal with and Justice Jessup found no such problem with O’Brien’s approach.  He then says at 13.6:

The First Problem suggests that across the dose range, the new statin must be more efficacious than currently existing statins, and must have at least as good a safety profile as those statins.  I would interpret the requirement of efficacy to be a reference to a statin’s ability to reduce a patient’s LDL‑C levels to an extent greater than the available doses of atorvastatin, which was the most effective statin available at the time.

This is important, your Honour, because contrary to what my learned friend Mr Bannon said yesterday, the search which O’Brien was actually embarking upon was not for the holy grail of the statin world.  He did not need to know that he had the best statin.  All he needed to know was that he had an effective statin, which was comparable with or more effective than atorvastatin.  We will see in a moment that answers the question of whether he would ever have done further searches.  The answer is, on the evidence, he would not have.  That is to say, further searches after he found Watanabe and 471.  Your Honours, then at ‑ ‑ ‑

FRENCH CJ:   It has to be more efficacious, does it not, on the problem as formulated to him?

MR RYAN:   I think he ‑ ‑ ‑

FRENCH CJ:   I am looking at 13.16.

MR RYAN:   Yes, yes.

FRENCH CJ:  

at least as good a safety profile –

MR RYAN:   As good or better.  Well, he says to a greater extent.  I agree ‑ yes, better.

FRENCH CJ:   So we are looking for something better than the ‑ ‑ ‑

MR RYAN:   Better than atorvastatin.  Not necessarily the best in the universe.

FRENCH CJ:   No.

MR RYAN:   13.9, your Honours:

I would need to identify a statin that would lower LDL‑C more efficaciously than atorvastatin across its safe dose range to address this problem.  For the statin to be more efficacious, it should have greater efficacy than existing statins at the maximum safe dose to assist in treating patients with very high LDL‑C levels.  It would also be advantageous to have greater efficacy with at least similar safety at the lowest recommended starting dose as this would benefit patients who were intolerant of higher doses.

FRENCH CJ:   Now, that term, “maximum safe dose”, that is maximum safe dose for that compound, is that right?

MR RYAN:   Yes, I think so, your Honour.

FRENCH CJ:   It has to be, does it not?

MR RYAN:   Yes.

FRENCH CJ:   There is no universal maximum safe dose that differs according to the ‑ ‑ ‑

MR RYAN:   Indeed.  There is quite some similarity across the range, but he must be talking about this compound:

My first step to solving the problem would be to identify an alternative statin.  Once that statin was identified I would look for any information on that statin.  From that information I would be interested in determining the efficacy of that statin across its dosage range ‑

Then he says at 13.11 –

I would start with a review of the literature –

and he goes on to describe some other things.  At 13.13 ‑

If I was given the problem in the context of a clinical trial then I would expect to have been given extensive information about the alternative statin –

We can put that aside, he was not – that is not the context, but that explains some of his other comments.  13.14 ‑

If I was not given the problem in the context of a clinical trial, and if I was not able to establish the name of the compound . . . then I would conduct a search on Medline . . . using keywords to identify any statins.

Then he identifies the key words that he would use, I will not read all that to your Honours.  Then at 13.8 he provides instructions, including keywords to Mallesons so they can go off to Medline at…..or get someone else to do it, to do the search – 13.18 I should have said.  So he has got his keywords.  He gives them to Mallesons.  They do the Medline search.  He gets the results and reviews them.  Down to “Results of the searches” under 13.24 at the bottom of page 1328:

I identified five abstracts of potential relevance to the problem which I discuss below.

At 13.25:

The first two abstracts are –

and he gives there the numbers ‑

These are two of a number of abstracts which relate to the statin “cerivastatin”.  The information from these abstracts indicates to me that it is less efficacious than atorvastatin and, for this reason, I would not consider it relevant to the First Problem.

The next abstract gives him NK‑104.  The next abstract at 13.27 gives him S‑4522.  Then there is a further abstract at 13.28 he identifies.  He requests a copy of the full text of those three articles; discusses them at 13.29.  They are Betteridge, Aoki and Watanabe.  At 13.30 he puts Betteridge aside; he does not disclose a new statin.  Then he says at 13.31:

The next article is the Aoki Article which discloses a novel HMG‑CoA reductase inhibitor which is referred to as “NK‑104”.  This statin has been tested in rats and dogs and appears to be more effective than pravastatin and simvastatin with a long residence time in the liver.  It appears to me to be a promising compound.  If this compound were to be pursed then the next step would be to see if I could get more information on the compound.  This could be done by searching “NK‑104” –

At 13.32:

The remaining article is the Watanabe Article which discloses a novel HMG‑CoA reductase inhibitor which is referred to as “S‑5422” and is even more interesting than the previous article.  This statin has been tested in rats, dogs and monkeys –

one more animal –

and appears to be more effective than pravastatin, fluvastatin and lovastatin.  At page 440 column 2 first paragraph it is stated that this is a promising candidate for development and has progressed to clinical trials.  This indicates to me that it therefore had sufficient safety and promise to proceed to the phase of development . . . also discussion of high potency with reduced side effects in clinical use.  From the statements in the Aoki Article and the Watanabe Article, it appears that S‑4522 is further along the line of development than NK‑104.  I therefore consider that in answering the First Problem I would regard S‑4522 as the most relevant compound identified although NK‑104 may also solve the problem.

Your Honours, by this process he has ascertained, understood and regarded Watanabe as relevant, thereby satisfying the requirements of section 7(3).  He is happy with it and there is no suggestion that he wants or needs to find any other compound or to check it.  What he then does at 13.33 is say:

Having an interest in “S‑4522” in solving the First Problem, I would conduct further searches to identify any further articles referring to this compound.

The evidence does not support the proposition that he would want to check by another general search that S‑4522 is an appropriate compound to go forward with.

FRENCH CJ:   Watanabe speaks, I think, in terms of potency of the compound.  Am I reading more than the evidence will be, as you say, that what is being looked for – or the problem, as you might put it – is to find something better than existing statins in terms of the ‑ by reference to the safe dosage range, and something which is efficacious over the smallest part, if you like, of the safe dosage range?  In other words, it is better if you are efficacious over the first 10 per cent of the range that you can give someone before you start poisoning them.

MR RYAN:   Your Honour, I do not think that it is necessary to confine the problem ‑ ‑ ‑

FRENCH CJ:   I am looking for a comparator.  What is really the nature of the comparator here?

MR RYAN:   Yes.  The problem suggests a need for a better treatment, a new statin, which will have better results than existing statins across their range, not just at the lower end of their range.

KIEFEL J:   When you say “across the range”, you mean according to dose?  You are looking for efficacy per dosage?

MR RYAN:   Exactly.

FRENCH CJ:   Up to and including the point at which it becomes unsafe, or within whatever appropriative margin.

MR RYAN:   Yes.  In the case of atorvastatin, the starting dose is 10, the maximum dose is 80.  We can take it, I think, that above 80, there are issues with safety.  Your Honours, going to the problem, which is page 1351 – 1353, sorry, your Honours:

it is important to find dosages of alternative statins which beneficially alter lipid levels to a significantly greater extent than similar dosages of currently used statins –

If one takes atorvastatin as the best currently used statin at that time, it would be beneficial to find an alternative statin which was more effective than atorvastatin over the range of 10 to 80 milligrams, is one way of looking at that problem.  Your Honours, at about halfway through 13.33, he says:

I would conduct a patent search as you often get a large amount of detail from patents.  Reference note 8 of Watanabe references a Japanese Patent.  I would expect that this would be in Japanese but I would expect that there would be similar patents in English language countries.  I consider that these patents may be useful in solving the First Problem.  I would therefore ask the university librarian to search for and obtain an English version of this document.

Again, this is the exercise of ascertaining a relevant document.  Our friends have no problem, as I understand it, with this part of the exercise.  By this exercise he went to footnote 8 of Watanabe, saw the reference to the Japanese patent and we will see a little bit later on, he asked someone to search and find the English equivalent of it and that is how we get to 471.  Just a further detail, when I say that is how we get to 471, what the search performed for him disclosed was the US equivalent of 471 – 471 is a European patent application.  He got the US equivalent but it does not matter.  They are the same, relatively the same. 

He then goes on to solve the problem that he has been posed based upon the section 7(3) document which he has ascertained, namely, Watanabe.  Paragraph 13.34:

Once I had identified a potential new statin, in order to work out a suitable dosage I would compare the results of that new statin with the known statins that were described in the comparative experiments in Watanabe.

Table 1, he refers to some experiments -

It shows that S‑4522 is more than three times as effective as pravastatin in inhibiting HMG‑CoA reductase and more than four times as effective as lovastatin in inhibiting –

that enzyme -

I would therefore expect that this compound would be significantly more effective than pravastatin or lovastatin in reducing LDL‑C levels in vivo.  This has been confirmed by in vivo animal experiments referred to –

So, we have got the animal experiments in Watanabe -

S‑4522 and pravastatin were compared in beagle dogs and cynomolgus moneys.

It gives the results of that comparison.  Jumping down to the last paragraph -

This suggests to me that S‑4522 is approximately 4 times as effective as pravastatin in lowering plasma cholesterol levels in a primate model.  Consequently, I expect it to have a similar or better efficacy than atorvastatin.  This would need to be confirmed by a direct comparison.

Over the page:

Based on the results in animal experiments, I would expect the drug to be effective in doses lower than the commonly used doses of pravastatin (which were 10 to 40 mg) and more effective at its maximum dose.  In a broad sense, the dose range in humans is likely to be similar to the currently marketed statins (between 10 and 80 mg), bit I expect it to be effective in lower doses.

Assuming animal studies confirmed safety, in human trials I would propose to test a dosage range of 2.5 to 80 mg based on S‑4522’s relative efficacy compared with pravastatin.  Given that Watanabe states that the clinical trial of S‑4522 is in progress I expect safety in animals to have been established.

Before 6 February 1999, pravastatin had a recommended starting dose of 10 or 20 mg and I commonly used 20 mg as a starting dose.  Consequently, I would expect to achieve the same or similar effect with a quarter of the dose of S‑4522 (that is, 2.5 to 5 mg).

My expectation of a starting dose would be around 10 mg once daily, based on its relative efficacy compared to pravastatin in the monkey model.  More specifically, and assuming the monkey studies translate into human studies, I would consider that a dose of around 10 mg of S‑4522 may achieve around a 35% LDL‑C lowering.  However, this would need to be confirmed in human subjects.  As stated above at paragraph 12.11, at least a 35% LDL‑C reduction at its starting dose is desirable if S‑4522 is to compare favourably with atorvastatin.

So, your Honours, we submit that provides a solid foundation for the concurrent findings of obviousness below, namely, a completely conventional application of section 7(3) requirements to ascertain, understand and regard as relevant Watanabe, and then to ask the section 7(2) question, is the invention obvious in the light of what is disclosed in Watanabe and the common general knowledge?  Professor O’Brien performed that exercise and arrived at a starting dose of 10 milligrams, which is within the claim.  Your Honours, we next go to the same exercise with 471.  As I mentioned, he used US 5,260,440 but that does not matter.  At 13.41, he talks about what we already know:

The abstract of the document discloses that the compound is useful in the treatment of hypercholesterolemia –

It provides you with dose ranges, the preferable dose range of 1 to 100 milligrams per day through the oral route.  He says:

This tells me that the author’s expectation is that these new compounds would sit within the typical dosage range of existing statins and be effective across this range.

He looks at the rat liver microsome testing and draws a conclusion from that.  About second last line on the page, the “Compound 1A‑1”, that is, 1A‑1 is the calcium salted rosuvastatin:

is 4.42 times more potent than lovastatin.

. . . 

13.44Based on these results, I would expect the drug to be effective in doses lower than the commonly used doses of lovastatin (mevinolin) (20 mg to 80 mg).  Consequently, I would expect to achieve the same or similar effect with a quarter of the dose of Compound 1A‑1 (5 mg to 20 mg).

13.45Assuming animal studies confirmed safety, in human trials I would propose to test a dosage range of 1 to 80 mg . . . 

13.46My expectation of a starting dose would be in the lower part of the range of 1 to 80 mg.  Based on its relative efficacy to lovastatin in rat liver microsomes, my expectation as to starting dose would be 5 to 10 mg once daily.  However, this would need to be confirmed by studies in human subjects.

So, your Honours, once again, having found 471 by conventional application of section 7(3) principles, he deals with the section 7(2) question and comes to the invention and, of course, I remind your Honours, he had never seen the patent in suit at this stage.

One of our friend’s propositions, of course, is that his search under section 7(3) was impermissible because it involved him comparing at one stage in that search Watanabe and Aoki.  I will not repeat what my learned friend, Mr Catterns, has said about that.  We say that is a wrong construction of the section.  There is no reason why the words “ascertaining” and “regarding as relevant” prevent comparison between documents. 

Indeed, my friend’s concession that one could conduct a search under section 7(3) by computer demonstrates the difficulty with his approach.  If you give a computer key words, the computer is comparing what it has access to by the presence or not of those key words.  It is no different than sitting at a table with 20 documents and saying, “I have to narrow this down, I think I will discard those ones that deal with potency and keep the ones that do deal with potency”.  That is a comparative exercise, and the computer is doing exactly the same thing.  However, I will not go over that ground again. 

One of the other points he made was that in the course of this exercise, the hypothetical person skilled in the art would be faced with a non‑obvious choice between Aoki and Watanabe.  I have just taken your Honour to his written evidence.  We submit the choice was clear for Professor O’Brien.  He expressed that in the course of the paragraphs I have just read to you, but it became even more clear on his cross‑examination - your Honours, volume 1, tab 27, beginning at page 418 down the bottom of the page.  My learned friend has been asking them about Aoki and NK‑104, and he then comes, at line 45, to Watanabe, and he says:

And then we come to Watanabe, and it’s correct, isn’t it, as the selection – as solution on this hypothetical exercise is based on a comparison of the best candidates of the individual pieces of information you got, correct?‑‑‑Yes, and particularly, in those abstracts, Watanabe mentioned specifically that it had progressed to human trials ‑ ‑ ‑

Right?‑‑‑ ‑ ‑ ‑ which gave me the suggestion that it was more advanced, and therefore a more likely solution to the problem than this agent.

This agent being NK‑104 –

But I did make the point that this was also a potential candidate.

Down at line 36, O’Brien says:

Well, I mean, the thing is that if –

That is, NK‑104 –

it’s not progressed to human trials, there may be an issue with toxicity that – there may be a reason for that.  So, you know, we just don’t know why one had and one hadn’t, but clearly –

It is clear to him –

if you’ve got two agents, one is being tested in humans, one hasn’t got that far, the one that’s being tested in humans is the preferable candidate.

FRENCH CJ:   I think we have been taken to those passages, but what is the statutory process that is happening here and translated into the notional universe?  Is that ascertainment, is it assessment of relevance?

MR RYAN:   We would say it is an assessment of relevance.  But my friend – so he engaged in this comparison in the course of the section 7(3) exercise, that is to say, assessing the relevance of what he had before him, in particular assessing the relevance of Watanabe.  It was more relevant than Aoki for a very simple reason. 

My friend deploys this in support of his proposition that the person skilled in the art would not be directly led to the invention, that is to say, he seeks to deploy this when he is dealing with the section 7(2) question, is it obvious?  He says not obvious because you are faced with a non‑obvious choice between Aoki and Watanabe.  We submit the evidence just does not bear that out.  There was a clear and obvious reason to choose Watanabe and both of the experts did it.

GAGELER J:   At the section 7(2) level?

MR RYAN:   Both of them did it at the section 7(2) level and, as your Honour knows, we say Aoki does not come into consideration in the section 7(3) level because at that point you can only ask is the invention obvious in the light of the common general knowledge plus one document, being Watanabe.  If we are wrong on that and if one does need to bring into consideration at the section 7(3) level something in addition to CGK plus Watanabe, namely, Aoki, on our friend’s argument - which we do not accept - but accepting it arguendo, was it obvious to go to the invention in the light of, for argument’s sake, CGK plus Watanabe plus Aoki?  Yes.  Aoki did not divert you from the track towards the invention which is laid out by Watanabe.  Aoki can be dismissed ‑ ‑ ‑

NETTLE J:   If you put them together under 7(3), then you are mosaicking, are you not?

MR RYAN:   I am sorry, your Honour?

NETTLE J:   I said if you put the two documents together under 7(3), as you just suggested you could, are you not mosaicking?

MR RYAN:   No, your Honour, I am not suggesting you can.  That is his suggestion.  But I would not say that is mosaicking.  Mosaicking typically is when a person says, “The invention is obvious to me because I see integers 1 and 2 in document A and integers 3 and 4 in document B.

NETTLE J:   I understand how you say you can look at both documents for the purposes of ascertaining relevance under 7(2), but once you get to 7(3) are you not confined by the words of the statute to but one document other than the CGK?

MR RYAN:   Indeed.

NETTLE J:   So how can you look then at Aoki?

MR RYAN:   You cannot.  That is our primary submission, which Mr Catterns ‑ ‑ ‑

NETTLE J:   It is your only submission, is it not, on that point?

MR RYAN:   Indeed, but my friend says by some means, which we do not accept, that you had before you the two of them, when you are asking the section 7(3) question, and he says therefore the invention is not obvious because Aoki leads you in one direction, Watanabe leads you in another direction, and it is not clear to you which direction you should proceed in.  We say you would never have the two, your Honour is absolutely right, but if you do have the two, it is clear that you proceed in the Watanabe direction.

GAGELER J:   I may be misunderstanding the fundamental point that he seeks to make, but he says that part of the invention is the selection of this statin – the statin disclosed in the Watanabe article – and that part of – as I understand his submission ‑ paragraph 13.32 of Professor O’Brien’s affidavit is to be read as disclosing that in choosing that statin, rather than the statin referred to in the Aoki article, a comparison was made between those two – well, use was made of the Aoki article.

MR RYAN:   Yes, he does say that and he says that that is – sorry, the area we are in here, the territory here is section 7(3) territory.

GAGELER J:   I think we are getting our subsections a bit mixed up.  Section 7(3) is identifying the additional information.  Section 7(2) is then the test of obviousness, having identified.

MR RYAN:   I am sorry – yes, section 7(3) is the step where one ascertains, understands and regards as relevant.

GAGELER J:   Yes.

MR RYAN:   I have said it the other way, have I?  Pardon me, yes.  So, at this point, 13.32, Professor O’Brien is in subsection (3) territory.

GAGELER J:   Yes.

MR RYAN:   He is ascertaining a document and determining its relevance.  In the course of that process, there is a degree of comparison with that document and other documents, which have been thrown up by the search, including Aoki.  One of the things my friend says is that one is not allowed to engage in that degree of comparison when performing the subsection (3) exercise.

GAGELER J:   Yes, but his main point as I understand it, is that when you get to the section 7(2) exercise ‑ ‑ ‑

MR RYAN:   Is it obvious ‑ ‑ ‑

GAGELER J:   ‑ ‑ ‑ in the light of Watanabe, Professor O’Brien in paragraph 13.34 already has selected the statin through the exercise of comparing Aoki with Watanabe and determining that the Watanabe statin is preferable.  I think that is his main point, factually.

MR RYAN:   Yes, he has.  That is what he says, and that is what has been done.  That is allowable because there is nothing in the terms of section 3 which would prevent that comparison and discard of Aoki before one gets to the section 7(2) question.  A degree of comparison, we say, including in this case, Aoki and Watanabe, is inherent in the exercise of ascertaining and regarding as relevant.

KIEFEL J:   But in paragraph 13.32, has not Professor O’Brien gone beyond the point of assessing relevance?  If relevance is that it bears upon the question – he identified both the Watanabe article and the Aoki article as relevant, and he has proceeded to what, as lawyers, we would call weighing; he has weighed them, and proceeds to give preference to one because it is more advanced in trials than the other.  That has taken him into the subsection (2) test, has it not?

MR RYAN:   We would submit not, your Honour.  It is determining degrees of relevance, of course, but it is still a determination of relevance.  As a practical matter, if your search throws up a number of things, then the determination of the relevance of any one of those particular things must depend upon a degree of comparison.  That is all he is doing at 13.32, and, we say, entirely properly.  If I am wrong, though, and your Honour’s proposition is correct, and that is that at 13.32, he is engaging in the section 7(2) exercise, i.e. working out whether the invention is obvious, we would say he has done nothing wrong in that case either.

KIEFEL J:   Well, the alternative might be he is engaged in a process which was somewhere in between the two.

MR RYAN:   That would be in a statutory no man’s land.

KIEFEL J:   It has happened before.

MR RYAN:   Trying to characterise the behaviour in terms of section 7, we would say our primary submission is that is section 7(3) activity.  But if we are wrong, and it is section 7(2) activity, it cannot be criticised because the choice he made is an obvious one.

KIEFEL J:   It could be that the reference to the Aoki article simply confirms what it is doing is confirming for him a preference, is it not?

MR RYAN:   It is.  I do not want to repeat myself, but it is confirming for him the relevance of Watanabe, and I say that acknowledging that relevance is a question of degree when you have got multiple documents.

FRENCH CJ:   Do we care much about what he did, when we get into the notional universe of section 7?  We have this notional person who is equipped with the common general knowledge; we hand him a copy of the Watanabe article; we can infer, perhaps from the expert evidence, that he would reasonably have been expected to have ascertained, understood and regarded it as relevant to work in the relevant art in the area; we do not tell him anything about Aoki in the notional universe.  Is it legitimate to proceed in that way?

MR RYAN:   We would say it is.  Sometimes, that approach is criticised because it is said that you have not established that Watanabe would have been ascertained.

FRENCH CJ:   That is what I am saying, that would have to be an inference as to whether he would reasonably be expected to have ascertained and regarded there as relevant to the work involved in - so we know something about the process which led to its discovery, as it were, or by which one could discover it.

MR RYAN:   Well, indeed, your Honour, we would submit that is an entirely appropriate way to go.  But, as lawyers are, they are concerned about being criticised later on for leading a witness, so you, in fact - so that the way ‑ ‑ ‑

FRENCH CJ:   This is not a witness, this is a notional person.

MR RYAN:   With the notional person, yes, but in order to assist the court to come to a conclusion what the notional person would do, the practice is to get a proxy for the notional person and see what he or she would in fact do.

KIEFEL J:   But what might happen is that under the statute all that is required is that once the document qualifies as relevant in the appropriate way, one then proceeds to the notional task under section 7(2), and what we have described as a no man’s land area of another process going on is completely irrelevant to that process.  What we have been discussing is something that is neither here nor there.  It is something a scientist might do in their process, but it is not addressing the task under subsection (2), which starts only from the point of a relevant document.

MR RYAN:   Not addressing the statutory problem directly, yes.

KIEFEL J:   Well, whether or not the relevant document has other weight compared with other documents in a scientific sense may not have any bearing upon the question which is then assessed under subsection (2) using that relevant document.

MR RYAN:   Yes, well, that is one way of looking at it, and one way you could proceed, but not in the way we start in this case.  Your Honours, that – they are our submissions under paragraphs 4 and 5, except to make the obvious further point that Justice Jessup made at paragraph 547 of the decision of the Full Court in volume 5 at page 2595, namely that, as we saw, Professor O’Brien came to his conclusions and acknowledged that they be subject to testing.  Our friends made a point about this and Justice Jessup said, and we support this reasoning, at 547, about halfway down the paragraph:

The evidence upon which the appellants relied –

That of Reece –

make it apparent that neither the Watanabe article nor the 471 patent contained safety data the result of either animal or human trials.  But that evidence also made it quite clear that such trials would conventionally be carried out.  They would fall within the concept of working towards the invention with an expectation of success referred to in AB Hassle -

Alphapharm.  In other words, he came to his 5 to 10 milligram dosages, accepted that it would have to be subject to testing, but he came to those 5 to 10 milligram dosages with rosuvastatin with an expectation of success.  In other words, the testing is not blind testing of some arbitrary dosage but one that he had arrived at in a scientific way from Watanabe but which he acknowledged would have to be the subject of testing.

Your Honours, lastly on obviousness, our friends make a point about the commercial success of their invention and we have three answers to this.  The first answer is that provided by the trial judge at paragraphs 332 and 333.  I do not need to take your Honours to it, but her Honour’s answer was the success that our friends enjoy was because of the compound rosuvastatin, not because of this particular dosage. 

In other words, the dosage could have been 4.9 or 11.1, it would not matter.  They would still have a successful product because rosuvastatin is a powerful inhibitor of HMG‑CoA reductase, indeed, better than the best at that time, namely atorvastatin, so of course it was going to succeed, not because of the dosage selection.

Secondly, we would provide the answer Justice Jessup gave at 551 – again I do not need to take the Court to it, but you could not assume that competitors necessarily had Watanabe or 471.  In other words, you cannot assume that the competitors had available to them the information which would lead to the invention, and they certainly did not have the patent, so you cannot assume that they were not astute enough to come to such a dosage themselves.

Thirdly, all the cases indicate that commercial success is, at best, a secondary indicator and a lot of other factors need to be taken into account.  You have to lay open all the facts necessary to make a proper assessment of that.  In this case, they would include the extent to which marketing contributed to the success of the product - our friends lead no evidence about that - and the landscape of protection available throughout the world for the compound rosuvastatin.  You do not get to treat someone with a 5 to 10 milligram dosage of rosuvastatin unless you have got rosuvastatin.

We know that the 471 application was in the UK and Europe.  We know the 440 application was in the United States and we know the Japanese one, which was referred to at Watanabe, was in Japan.  No doubt, there was patent protection for this compound throughout the rest of the world as well – or various places in the world.  So if you could never get the compound because you could not make the compound, it being protected by its own patent, you cannot even get into the territory of applying the invention.  So, that is the third answer we give to our friends’ commercial success argument.

Your Honours, next on my three‑pager is novelty.  The Full Court dealt with this at paragraph 256 and following.  Again, that is in volume 7, page 2505.  The novelty case which we pursue is based upon the 471 patent.  A copy of that is at volume 3 at page 1061.  I do not need to take the Court to the patent itself because the relevant passages are sufficiently set out in the judgment of the Full Court.  So, 256, the court notes that the 471 patent states:

The compounds of the present invention inhibit the HMG‑CoA reductase, which plays a major role in the synthesis of cholesterol, and thus they suppress the biosynthesis of cholesterol.  Therefore, they are useful in the treatment of hypercholesterolemia –

That is the first thing – compounds being disclosed as being useful in the treatment of hypercholesterolemia.  Then at 258, a further extract from the 471 patent:

. . . Pharmaceutical compositions comprising the compounds of the present invention can be administered orally –

That is the second point that we note.  At 259:

The dosages may vary with the administration route, age, weight condition, and the kind of disease of the patients, but are –

We can skip to the best -

preferably 1‑100 mg/day for oral administration . . . They may be used in single or divided doses.  

So, your Honours, we have, we would submit there, a disclosure of each element of claim 1, and at 263 the trial judge saw it as such.  She says:

This is a clear disclosure that the compounds, or at least –

pardon, your Honours, we will get to this over the page, but as well as a disclosure of a formula which included rosuvastatin and millions of other things, as my learned friend says, there were two specific examples of rosuvastatin calcium and rosuvastatin sodium.  So her Honour says at the extract of her judgment which is set out at 263:

This is a clear disclosure that the compounds, or at least the specific examples given, are useful for treating each of the three diseases in the dosage ranges identified.  The fact that the dosage range may vary depending on each of the factors described (disease, age, weight etc) does not undermine the sufficiency of this disclosure.  It is a specific disclosure, and would be understood as such by the skilled addressee, of the usefulness of rosuvastatin (a specific example given of the compound) for treating hypercholesterolemia (a specific disease associated in the context of compounds which are HMG‑CoA reductase inhibitors . . . in specific dosage ranges (preferably –

she says “0.l‑100”, but that is an error; she means 1 to 100 –

per day for oral administration) in either a single daily dose or a split daily dose.

In other words, your Honours, it does not matter that there was a range disclosed of 1 to 100, and it does not matter that it was also said that these compounds, including the two specific examples – rosuvastatin sodium and rosuvastatin calcium – might be used to treat hyperlipoproteinemia and atherosclerosis and that you might deploy a different dosage range for someone who is old and fat compared to young and skinny.  There is a disclosure of the utility of the compound for treating each one of those conditions with a once daily oral administration of the drug at each one of those dosages between 1 and 100.

That was rejected by the Full Court, and in particular their Honours applied the test which is commonly deployed, derived from General Tire at paragraph 293 and we submit they erred in the application of General Tire.  At paragraph 293, just going down to the fourth line of the extract from General Tire:

If the prior inventor’s publication contains a clear description of, or clear instructions to do or make, something that would infringe the patentees claim if carried out after the grant of the patentee’s patent, the patentee’s claim will have been shown to lack the necessary novelty, that is to say, it will have been anticipated.

That is the first limb of General Tire.  If you have got a clear description of that which is subsequently claimed, there is anticipation and you stop there.  General Tire then goes on to discuss a different situation where there is a lack of clear description.  The court says:

The prior inventor, however, and the patentee may have approached the same device from different starting points and may for this reason, or it may be for other reasons, have so described their devices that it cannot be immediately discerned from a reading of the language which they have respectively used that they have discovered in truth the same device; but if carrying out the directions contained in the prior inventor’s publication will inevitably result in something being made or done which, if the patentee’s patent were valid, would constitute an infringement of the patentee’s claim, this circumstance demonstrates that the patentee’s claim has in fact been anticipated.

So you might have a situation where there is no disclosure on the face of the document said to be in anticipation because of the use of different language, but it is in truth the same thing.

There are plenty of cases about that, and we have referred to some of them in our outline of submissions.  But one very good example is the Abbott v Apotex, the reference of which we have included, where the invention was for a compound – sibutramine hydrochloride monohydrate.  The alleged anticipation disclosed a protocol for a series of experiments, and then disclosed a product of those experiments, which was not said to be the monohydrate. 

The proposition of the revoker was, nevertheless, as a matter of fact, if you carry out these experiments, what you get is the monohydrate.  It does not matter that the author has not used those words ‑ that is what it is.  The question then was, in that case, well, carrying out the experiments do you inevitably get the monohydrate?  That was an application of the second leg of General Tire.  But, if you did not get the monohydrate – or you did not inevitably get the monohydrate, there would have been no anticipation.  The court deals with that possibility:

If, on the other hand, the prior publication contains a direction which is capable of being carried out in a matter which would infringe the patentee’s claim, but would be at least as likely to be carried out in a way which would not do so, the patentee’s claim will not have been anticipated –

So, that inevitable result test applies, we submit, where you do not have a clear disclosure.  The Full Court erred because it treated the present case as a case of lack of clear disclosure and therefore asked itself – or applied the inevitable result test as we see at 298.  Their Honours said:

Here, relying only on the disclosure of the 471 patent, and not imputed common general knowledge concerning the administration of prior art statins, the person skilled in the art might seek to use one or any number of different dosages and dosage regimens for administering a pharmaceutical composition containing either the sodium salt or the calcium salt of rosuvastatin to treat hypercholesterolemia.  It is possible that, out of a very large number of possibilities, the person skilled in the art might, based only on the disclosures on the 471 patent, use the dosage and dosage regimen of claim 1 or claim 2 . . . But it is at least equally possible that such a dosage and dosage regimen might not be used.  It cannot be said, therefore, that, by following the directions – such as they are – in the 471 patent, the person skilled in the art would inevitably do something that would inevitably infringe either claim 1 or claim 2 of the 051 or low dose patent.

Now, it is true but that is because – not because there is no clear disclosure of what is claimed in the patent in suit, but because the 471 patent makes a number of different disclosures and a number of different recommendations.  It recommends, for example, that you can use rosuvastatin for the treatment of arthrosclerosis.  You might follow that – a person might read 471 and follow that recommendation and of course he would not – he or she would not – inevitably do something falling within the claim of the patent in suit.  But that is not the point.  You are not in that territory unless you can – unless you do have a clear disclosure of what is claimed in the alleged anticipation, and we say we do.

Your Honours, may I deal next with – I have skipped over infringement on my three‑page document.  Can I deal with manner of manufacture, just because it is convenient to go to it now?  The Full Court dealt with this at paragraphs 369 and following, particularly at paragraph 379, which is page 2534.  They deal with the authority, Philips, a decision of this Court.  Without repeating what my learned friend, Mr Catterns, has said about all this may I simply go to the extracted quotation from Philips and the last three lines of it:

It –

That is, the ground of no manner of manufacture –

simply means that, if it is apparent on the face of the specification that the quality of inventiveness necessary for there to be a proper subject of letters patent under the Statute of Monopolies is absent, one need go no further –

and we submit the quality of inventiveness so necessary is absent on this specification.  It is accepted that what one may have regard to for this ground is confined to the body of the specification, but also information which is incorporated in that specification by reference, and our submission below was that 471 and Watanabe are to be incorporated so as to be information which could be deployed on this ground.  The Full Court rejected that at 389.  They said:

We are not persuaded that the primary judge was in error in concluding that the 471 patent and Watanabe are not incorporated into the complete specification.  Those publications are only referred to in the complete specification as the source of the statement that rosuvastatin has been disclosed as an inhibitor of HMG‑CoA reductase that is useful in the treatment of hypercholesterolemia . . . That being the case, the generic parties’ contention cannot succeed for this reason alone.

They draw a distinction between that reference to 471 and Watanabe on the first page of the specification to a subsequent reference to guidelines under the National Cholesterol Education Program, the so‑called NCEP guidelines, which are specifically incorporated by a language that says we specifically incorporate these guidelines.

Your Honours, our proposition is that it cannot be a matter of language.  The question must be, always, does the author intend you to read the documents he has referred to as part of his disclosure concerning the invention.  Our proposition is that that must be so in the case of Watanabe and 471, because each of them discloses a method of synthesis of rosuvastatin.  That is an integer of the claim, and you have to have it.

The patentee must fully describe the invention, including the best method of performing the invention.  Therefore, he has to tell you how to get the compound.  For that you look to 471 and Watanabe and their modes of synthesis.  So we submit it is clearly the intention of the patentee to incorporate those documents into the disclosures of the complete specification.

Your Honours, when you have those documents, in particular the 471 patent, you have, as we have just seen, a dosage range disclosed to you, 1 to 100, a dosage regime, a once daily oral treatment with a single dose, and the only thing left then is the selection of the 5 to 10 milligram dosages.  Also disclosed on the body of the specification, as my learned friend, Mr Catterns, said, is the fact that atorvastatin is a leading – page 12 of the specification – atorvastatin is a leading statin with a starting dose of 10.

Our proposition is that the level of inventiveness necessary for there to be a manner of new manufacture is not present in circumstances where every element of the combination is disclosed on the body of the specification, and the only element not disclosed as old, as known, is the selection of the dosage which coincides with the known starting dose of a known statin – indeed, the best known statin on the market.

Your Honours, finally can I deal with – I am sorry, your Honours, I have forgotten one thing.  In relation to novelty, we submit that claim 3 fails for lack of novelty.  The trial judge in her reasons – which the Full Court noted – suggests that claim 3 fails because it is dependent upon claim 1 – would not necessarily fail just because it is dependent upon claim 1.  Our proposition at trial was that claim 3 should fail if claim 1 fails because they cover precisely the same territory.

Claim 3 defines a person suffering from hypercholesterolemia, not by saying a person suffering from hypercholesterolemia, but rather by describing a person who has a certain degree of low density lipoprotein which is recognised, pursuant to the NCEP guidelines, as a level of lipoprotein of a person who needs treatment because he or she has hypercholesterolemia.

The evidence to that effect was from Professor O’Brien.  I should quickly take the Court to that.  Appeal book, volume 4 at page 1391.  There are other references which we have referred to in our outline of written submissions, your Honours, but this is probably the clearest one, or simplest one.  He is dealing with the question of whether EP 471 anticipates the patent in suit.  He comes to claim 3.  Your Honours can see claim 3 set out there.  Just taking the first paragraph, one of the things is:

A method as claimed in claim 1 or 2 wherein the patient has an LDL‑C level of 160 mg/dl or greater with no chronic heart disease or peripheral vascular disease and one or no risk factors for such a disease –

So, that is the patient’s statistics.  As Professor O’Brien says, that is a person with hypercholesterolemia.  He says:

The cholesterol levels are cholesterol levels that define hypercholesterolemia in terms of known levels consistent with the patient being outside NCEP guidelines.  There is no explicit reference to the levels of cholesterol.

That is to say in 471:

However, by definition if a patient’s cholesterol level is above these targets then that patient has hypercholesterolemia and requires treatment.  I therefore consider that this feature is shown to me in this document.

That is to say in 471.  Your Honours, our friends – there was no cross‑examination about that.  There was no one called to dispute that.  There was no submission made at trial that claim 3 had any life independent of claim 1.  We would submit that that evidence is uncontested and, plainly, on that account if claim 1 goes, claim 3 should go as well.  Your Honours, I was just going to deal with infringement.  The Full Court dealt with this at paragraphs 423 and following, which is page 2547 in volume 7.

Just by way of background, our friend’s case for infringement depends upon section 117.  Of course, they – which makes it an infringement to supply products in certain situations, put compendiously where their use by the ultimate user would infringe and, of course, the claims are directed to the use of 5 and 10 milligram dosages for the treatment of hypercholesterolemia.  But our friends ran a more expansive case at trial.  They said the supply of not just 5 and 10 milligram dosages, but also 20 and 40 milligram dosages would infringe under section 117 because they say in the case of the 20 milligram dosage, some people would split it so as to give themselves two 10 milligram tablets and, indeed, they went so far as to say with the 40 milligram dosage, some people would split it four ways to give themselves a 10 milligram dosage.  They do not persist with the case on 40 milligrams, but they do persist with the case on 20 milligrams.  Your Honours, just looking at the section:

(1)       If the use of a product by a person –

e.g. the patient –

would infringe a patent –

in this case, infringement by using a 20 milligram rosuvastatin tablet by breaking it in half, taking a 10 milligram portion and then using it as a starting dose for the treatment of hypercholesterolemia.  So, if that use –

would infringe a patent, the supply of that product by one person –

e.g. my client –

to another –

e.g. the chemist –

is an infringement of the patent by the supplier unless the supplier is the patentee or licensee of the patent.

(2)A reference in subsection (1) to use of a product by a person is a reference to:

. . . 

(b)if the product is not a staple commercial product – any use of the product, if the supplier had reason to believe that the person –

e.g. the patient –

would put it to that use –

Your Honours, we say two things in answer to this allegation of infringement.  We first of all say that a 20 milligram rosuvastatin tablet is a staple commercial product ‑ ‑ ‑

FRENCH CJ:   This is on the basis of a variety of possible uses.

MR RYAN:   Yes.  More specifically, your Honour, a variety of possible non‑infringing uses.

FRENCH CJ:   Yes.

MR RYAN:   Secondly, we say, we do not have reason to believe that the patient would put it to the infringing use.  Their Honours and the trial judge rejected our proposition that the 20 milligram product was a staple commercial product.  In particular, they each said that it was not aptly described as a staple.  The Full Court – contrasting it to, for example, timber, which as your Honour ‑ ‑ ‑

FRENCH CJ:   A bit different from timber.

MR RYAN:   It is a bit different; that was the obvious contrast, yes.

FRENCH CJ:   Or nails, or things like that.

MR RYAN:   Which was the example in a decision of this Court in Northern Territory v Collins, which I will go to in a moment.  At 429, they noted that:

In argument before us, the generic parties placed considerable reliance on the judgment of Crennan J in Collins at [145]. Her Honour said that the phrase “staple commercial product” means “a product supplied commercially for various uses.”

At 431, the court said:

We are not satisfied that rosuvastatin is a staple commercial product.  The fact that it may be used for both infringing and non‑infringing purposes is not conclusive –

We say it is –

There are many products capable of being used for both infringing and non‑infringing purposes that cannot be characterised as either raw materials or basic products –

Your Honours, just pausing there, we submit that is a focus on the word “staple” rather than the composite expression “staple commercial products” –

commonly used for a variety of purposes.  The uses to which rosuvastatin may be put appear to us to be limited to the prevention or treatment of cardiovascular disease and its associated risk factors (e.g., high cholesterol).

Your Honours, could I go to Northern Territory v Collins 235 CLR 619. At 619, from the headnote, briefly:

Proceedings were instituted against the Northern Territory for the infringement of s 117 by the granting of statutory licences to harvest timber that was allegedly used as part of a patented method to produce essential oils.

The allegation was infringement by supply, which ‑ ‑ ‑

FRENCH CJ:   Supply to a competitor of the patentee who had this aromatic oil, I think.

MR RYAN:   Thank you, your Honour, yes.  Of course, the answer which was made to the allegation by the Northern Territory was we are supplying timber and that is a staple commercial product.  In the course of dealing with that defence, the High Court upheld the trial judge, and in the judgment of Justice Hayne at 41, his Honour said:

I agree with Crennan J that a staple commercial product is one that is supplied commercially for various uses.

Paragraph 42:

“staple commercial product” must be read as a whole and it must take its meaning from the context in which it sits.  In particular, it is to be recalled that s 117 creates a liability in a supplier of a product where the act of supply would otherwise not infringe a patentee’s rights.

That is to say, the supply per se is not within the claims:

Section 117 imposes liability on the supplier if use of the product supplied by the person to whom it is supplied would infringe.

In this setting “staple commercial product” should not be given a narrow meaning.  To do so would expand the classes of supply which are reached by s 117, thus expanding the rights of the patentee where, by hypothesis, the act of supply is not otherwise an infringement of the patentee’s monopoly.

And over at 48:

To read “staple commercial product” as identifying a product that is supplied commercially for various uses does not reflect the notion of principal or chief importance sometimes conveyed by the adjective “staple”.  But as Crennan J concludes, “staple”, used adjectivally in the compound expression “staple commercial product”, should not be read as directing attention to the economic significance of the product concerned.  Rather, it should be read as inviting attention to the variety of uses to which the product both can be, and is in fact, put.  It is that variety of uses which, when the produce is supplied commercially, makes the product a staple commercial product.

Then finally, in the judgment of Justice Crennan at 143, page 653:

It has been suggested by at least one writer in respect of European rights that a “staple commercial product” has two main qualities:  first, it must be “[a] basic product commonly used for various purposes”, and secondly, it must be “[g]enerally available on the market”.

Raw materials such as wool or timber undoubtedly have the first quality.  As to the second quality, it is necessary to recognise that s 117(2)(b) operates to limit liability for contributory infringement.  Policy arguments in favour of imposing liability for contributory infringement are much weaker with a product that has significant non‑infringing uses.  The legislative intention evinced in the statutory language, and apparent also from the relevant secondary materials, is to except from liability, the supply of products with significant non‑infringing uses –

I rely upon but will not read the rest of that paragraph, and paragraph 145 ‑ ‑ ‑

FRENCH CJ:   It really started off as a sort of judge made document which turned up in a statute in the US and dealing with, as it were, off the shelf products which would then be put into or become components of infringing articles or devices.

MR RYAN:   Yes.  But, your Honours, as we understand the ratio of the case, here, by definition the supply of 20 milligram – applying to the present case – the supply to 20 milligram tablets of rosuvastatin is not an infringement.  The claim is confined to 5 to 10 milligrams, and confined further by the use of them as a starting dose.  Why should a supplier of 20 milligram tablets be responsible for and, in a sense, have to police what is done with tablets after he or she has parted with possession of them when they have significant non‑infringing uses. 

Parliament’s intention, we would submit plainly, is that if you – if a product has only one reasonable use, which is an infringing use, then fair enough, a supplier is caught and he is caught under paragraph (a).  If the supplier induces the infringing use, he or she is caught under paragraph (c), but under paragraph (b), if it is a product which has significant non‑infringing uses, it is therefore a staple commercial product and the supplier can supply it, even if he knows that some people may use it in an infringing way.  It is a practical solution to the difficulty which faces suppliers of products with various non‑infringing uses.

On the evidence in the present case, your Honours, there is no doubt that 20 milligram rosuvastatin tablets have significant non‑infringing uses.  First of all, they may never be split.  The evidence at trial was – and the Full Court refers to it – that the statistics demonstrate that 2.75 per cent of patients split the tablets.  So, 97.5 per cent of patients who get 20 milligram tablets of rosuvastatin are never going to break them in half.  Then, some small proportion of the 2.75 per cent who break them in half are going to use them, not as a maintenance or continuing dose for their hypercholesterolemia, but as a starting dose.  And, indeed, even of those tablet splitters, some of them may use the split tablet not even for the

treatment of hypercholesterolemia but for the treatment of other conditions which the Court found it could be used to treat.

Fair enough, they are treatments related to cardiovascular disease but the only infringing use is for the treatment of hypercholesterolemia.  Dr Hay gave evidence that he prescribes rosuvastatin as an anti‑inflammatory.  So, there is a tiny portion of people who, on the stats, will split this tablet and use it as a 10 milligram starting dose.  But the alternative uses are so significant that, we would submit, consistent with the authority of Collins, it should be regarded as a 20 milligram – as a stable commercial product.

For essentially the same reasons, your Honours, we say we cannot be said to have reason to believe that the product, any particular product, will be used in an infringing manner.  It is a matter of statistics that someone amongst the multitude of people that receive the tablet will split it and use it as a starting dose, but that does not provide a sufficient foundation to say we have got reason to believe that any particular person – or any significant number of people – will use it in an infringing way.  May it please the Court.

FRENCH CJ:   Yes, thank you.  Mr Bannon.

MR BANNON:   Your Honours, firstly by way of reply on the dosage issue which is outlined in proposition 14 in our oral outline, just to put this issue in context.  This issue is – assuming one has selected rosuvastatin in the 7(2) process – is it nevertheless obvious, in the light of Watanabe or 471, to try in expectation of success a 5 to 10 milligram dose.  That is the context in which the debate arises.  In that context, my learned friend, Mr Catterns, submits there are concurrent findings of fact that selecting a dosage of 5 to 10 milligrams was obvious and he supports that prior position by numerous references to this proposition that one can proceed from known dosages of other statins to a selection of dosage of a new statin.  That is an attempt to overcome the evidence of Dr Reece which, we respectfully submit, submits to the contrary.

Can I just put this in a little more context?  We refer in our outline, proposition 14, to relevant paragraphs of Alphapharm, which I did not take your Honours to, but could I just briefly remind your Honours of them.  So, that is Alphapharm 212 CLR 411 at 439, paragraph 67. This is a passage from Lord Justice Buckley, which the Court approved which I will not read out, but in particular, it is the last few lines which are important, and to not dissimilar effect is paragraph 72, and again in particular, the last few lines which emphasise the importance of, in effect, the ultimate combination which in this case is the use of rosuvastatin at 5 to 10 is obvious. One is going there in the expectation – some cases have described it as a reasonable expectation of success. That is the context in which this debate arises.

Now, my learned friend says there are concurrent findings of fact, and he points to the primary judge’s at 320 and the Full Court at 547.  We say there are actually consistent findings.  Indeed, 547 is inconsistent with 391 of the Full Court as we have referred to.  Can I just tease out those propositions?  Firstly, if one goes to paragraph 320 in volume 5 at 1927, about point 40, her Honour cites a characteristically understated submission from us and in particular picks up the fact – recognises that:

the Watanabe articles does not disclose the maximum tolerated dose in any animal, toxicological effects –

i.e. in shortcut, animal data.  Continuing at about line 50, her Honour says:

In this regard, the cross‑examination of Dr Reece, a formulator . . . was not particularly helpful.

What her Honour is referring to there is the cross‑examination of Dr Reece which I took your Honours to, which is at 536 to the top of 537 where he said animal data is the critical data.  My learned friend, Mr Catterns, with respect, tries to downplay that a little bit.  He said it is the critical data.  You cannot even get FDA approval before you move forward.

The slightly deeper background to that cross‑examination is a reference on about 534.  I was putting to him the cerivastatin dosage which was 0.3 milligrams and I was saying to him, well, would you not take that into account to say that you would not choose 5?  I was perhaps doing the opposite of what – I said – he was the one who volunteered no, you do not use other dosages of other statins, you cannot do that.  His concluding words is it not “an appropriate scientific” method. 

So that is the evidence that the primary judge is referring to.  The primary judge recognises that that evidence is an impediment to a finding that it is obvious to pursue 5 to 10, we say implicitly.  So what the primary judge does is to say, but look what Dr O’Brien does, and she refers to some of the evidence which our learned friend, Mr Ryan, has referred to.  A different view of that is – if one then comes forward, as I have pointed out in‑chief, to 547 in the Full Court – sorry, 548 in the Full Court which is on the bottom of 2595, and that is where his Honour in that paragraph implicitly accepted our criticism that Professor O’Brien was not an irrelevant expert on dosage.  But Justice Jessup said that did not matter because there was a team and Dr Reece would be part of the team.

What the primary judge had – we respectfully submit, with no disrespect – had overlooked the fact that Dr Reece’s chief expertise, his chief expertise was selecting doses from animal data.  So that Justice Jessup says we can put Professor O’Brien to one side, to the extent my learned friend Mr Ryan seeks to have him restored by referring to that dosage data, that would require this Court doing something which we submit the court would not do because it would challenge the recognition of the Full Court for his lack of qualification. 

So it is against that background one comes back to 547, and perhaps I should add – I just should add one of the other references we gave in outline 14 was to paragraph 84 of Dr Reece’s evidence.  There, perhaps I could – it is probably sufficient if I give your Honours – perhaps I will go to it – because that is where he points out the way you do this – this is on volume 3, on page 949 at paragraph 84, he actually has a formula by which you identify the dose by reference to animal data.

He says you start with 1/250th.  So it is in that context, if one works one’s way back to 547, which is what my learned friend says is the concurrent finding, 547 is in a background where, if one just goes back a little bit further, on 2594 to paragraph 544, where his Honour refers at about line – reference 45 in the margin – to Dr Reece having an expectation, as my learned friend, Mr Catterns, referred to – having reviewed those sources, Dr Reece adhered to his evidence - just to clear, your Honours were taken to this evidence - his evidence was, “I am told about a new statin which I know nothing about, but it is powerful.  What would I expect to put in phase trials”, and he says five to 10. 

Then he says, “I read Watanabe.  I have read Watanabe.  That does not cause me to change my expectation”.  So it is not so much what do I get out of Watanabe, it is some sort of reverse proposition.  But be that as it may, that is not a reference there to the cross‑examination of course, which you have just seen.  In 546, we put the submission to adopt the course, about line 25 his Honour records the submission that to use other data of known drugs:

is not the determining factor . . . and that “there was no animal –

data.  So this is the point.  If one comes then to 547 – in other words, Justice Jessup has recognised (a) you cannot use Professor O’Brien, (b), recognised that Dr Reece has, in the cross‑examination recognised he does not have the data so he has to do testing.  So rather than say it is a concurrent finding it was obvious to select 5 to 10 from known doses of other statins, what his Honour Justice Jessup says, I accept that there is going to have to be testing.  Just bear in mind that testing is – you actually have to do the tests on animals.  You have get animals and do the tests because there is no animal data.  Then once you have that data, depending on what it is, you select the dose. 

His Honour here says that is okay, that is all within the range of Alphapharm.  We say it is clearly not in the range of Alphapharm.  That is a voyage of discovery, finding something you do not know and, depending on what that information is, then you select the dose.  One of the more baffling parts of this issue is that if Justice Jessup agrees with the reasons of the majority – the plurality, I should say – the agreement is in 447 on the other issues, that takes one back to 391.  This is an inconsistency we point out in – I think it is paragraph 25 of our submissions. 

In 391, the plurality said, armed with just the 471 and Watanabe issues, you do not get dosage from that because you have to do tests, which are the tests we have been talking about, namely data tests.  They are the sort of tests which take you outside of Alphapharm.  The very tests that Justice Jessup says in 547 are within Alphapharm, the plurality has said are outside Alphapharm.  The plurality in 391, we respectfully submit, are clearly right. 

The other baffling part about it is the plurality agree with Justice Jessup’s reasons in relation to the other issue, so something, we respectfully submit, has gone wrong in Camelot.  Just on that issue alone, we respectfully submit if one accepts that, that is an essential element of the case, even if they get the notional skilled addressee to selecting rosuvastatin, they fail.

Can I just add one additional point on this?  A real world demonstration of Dr Reece’s evidence on this is the NK‑104 product itself; it was eventually marketed as pitavastatin.  We have seen in NK‑104 it had similar power and potency to what became rosuvastatin in those early articles.  The evidence was it was toxic above 4 milligrams. 

We have given the reference to that evidence in outline 14, but could we invite your Honours to add an additional reference to some evidence of Professor O’Brien, which is appeal book 1373, lines 15 to 19, where he identifies NK‑104 as pitavastatin.  That is just a demonstration that if you have just got the information you see, which is the equivalent information in NK‑104 versus Watanabe, you cannot know with any reasonable expectation of success that…..of any particular date which would be useful.  So we say 547 reflects ‑ ‑ ‑

FRENCH CJ:   Well, you know potency.  You do not know safe dosage range.

MR BANNON:   If you do not have animal data you do not know safe dosage range, and you cannot even reasonably predict what will be the starting dose or any other dose in humans.  You cannot even get a clinical trial started.  You have to do the animal data.

FRENCH CJ:   Well, subject to safety, you would always start at the lowest.

MR BANNON:   Yes, absolutely.  Indeed, that is why that paragraph 84 of Dr Reece says you do 1/250th of how you would run really in animals.  So we respectfully submit – the way we put it, both on the special leave application ‑ ‑ ‑

FRENCH CJ:   That 1/250th, the animal level that is cited there - I think it is doing it in the context of an example with Alzheimer’s treatment - is where you first get some ‑ ‑ ‑

MR BANNON:   Potency ‑ ‑ ‑

FRENCH CJ:   Electroencephalographic change.

MR BANNON:   Yes.

FRENCH CJ:   Then there is a rule of thumb of one to 250 - I suppose it depends which animal you use.

MR BANNON:   Yes.  There is some evidence actually, if one goes back into Dr Reece’s affidavit there, he says you take a choice but ideally you would get primates because they are the best guide.  So just pausing here - and primates are not easy to get in the sense that rats are easy to get.  I am saying it is not an insignificant thing to have to go and do animal testing.  You have to set it up, you have to find – and ideally you have to find the best animal to do it.  So it is not an insignificant thing one is mentioning here.

So the way we put it in our submissions on this point and on the special leave application is we say that the 547 finding does represent a fundamental error in terms of Alphapharm and all the rest of it.  We suggested it might be because the court felt driven to pursue Watanabe because of the view it had in relation to the way you do 7(2).  In other words, you are driven down that task and you almost trample over what might seem to be obstacles. 

Whether that is the reason or not, there is a fundamental error, and if that error is accepted by this Court, we respectfully submit we must win on 7(2) on any view.  Indeed, we would win even if we were wrong about starting point, because her Honour’s view on starting point says if you have got Watanabe it is obvious to go 5 to 10.  So if we succeed on that point the patent on that issue, we would respectfully submit, is restored.  Indeed, it goes a long way to saying that the issue in relation to manner of manufacture is also restored as well.

Could I then move on secondly by way of reply to the issue of section 7(2) and 7(3) and introduce it this way.  An observation fell from your Honour the Chief Justice that why could one not have treated this as a case of here is Watanabe, here is the common general knowledge, what do you do then?  The answer is there is no negative answer to that.  One could have.  The way the case proceeded, however, was ‑ ‑ ‑

FRENCH CJ:   I was putting that in the notion of universe.

MR BANNON:   Absolutely, yes.  The way the case proceeded, however, was, in reliance on the evidence of Professor O’Brien and Dr Reece, both the primary judge used their evidence to get the choice – (a) to get the document, and (b) to get the choice to proceed down that path. 

So that albeit, we fully accept, that people such as Professor O’Brien and Dr Reece attempt to assist the court in – your Honour used the expression “avatar” – the notional person, nevertheless, that was the evidence before the court and how both courts treated it.  So we say that this is not a case where this Court for the first time could substitute, in effect, a factual finding – in effect, divorced from the expert evidence – and say, well, if I only have common general knowledge and I have Watanabe, the court looking at it, what would one do?  So that is my preference to that.

FRENCH CJ:   Really, the question goes to what is the statutory task.

MR BANNON:   Yes. 

FRENCH CJ:   That is not a question of taking a different factual approach, is it?  The question is what is the statutory task demanded by 7(2)?  What is the minimum requirement – CGK plus Watanabe, informed by the inferences about ascertainment and relevance that one draws from the expert evidence, et cetera.

MR BANNON:   Yes.  Can I come back after I address the more specific way the case has been fought and come back to that – if I may put it – perhaps a more overviewing look and address it this way?  Firstly, in response to a question from your Honour Justice Gageler, Mr Catterns accepted that a finding of obviousness under section 7(2) required a conclusion by the court that the skilled addressee would have chosen the statin identified in Watanabe.  That was at transcript 71, line 3092.  On that issue, we agree.  One has to draw a conclusion that the skilled addressee would have chosen Watanabe as a first step.

He then proceeded to say at transcript 69, line 2999, that the respondents were entitled to rely on Watanabe because it had been identified by Dr Reece as “the” relevant publication.  There may be a debate as to whether he had actually done that, but let us assume he did that for factual purposes.  Indeed, my learned friend, Mr Ryan, consistently relies on paragraph 13.32, which we have just looked at – volume 4, 1330 – of Professor O’Brien to say that he chose Watanabe, I think it was, because he said it was better than – as the most relevant, better than NK‑104.

Now, those positions, with respect, crystallise an issue of principle dividing the parties.  A conclusion that Watanabe was the relevant publication, or the most relevant, can only be made with benefit of knowledge that the content of the other publications were not as promising.  That knowledge, as we submitted in‑chief, is not common general knowledge and it is additional to the knowledge you get out of Watanabe on its own.

It follows that if, therefore – and this is the way they ran the case – to persuade the court that the hypothetical skilled addressee would have chosen Watanabe, they relied on evidence of these two proxies that they would have chosen it because they made that comparison.  That was error, and it is error because they took into account three pieces of information:  two authorised, one unauthorised.  One was common general knowledge, one was the knowledge individually contained in Watanabe, and the third was the knowledge that there was nothing else better out there.  Section 7(3) does not permit that, and nor does 7(2).

GAGELER J:   How do you deal with Mr Ryan’s point that the quest was not to find the best, but simply to find something that was better than what was known?

MR BANNON:   I deal with it simply on the evidentiary basis that the respondents have to persuade – as they seem to accept – that at the 7(2) level, they have to persuade the court that the hypothetical skilled addressee would have, with the benefit of Watanabe and common general knowledge, chosen Watanabe and then in addition chosen 5 to 10.  The way they do that is relying on these two gentlemen by saying they chose these on the basis of their evidence on the one that Professor O’Brien – it was in fact the most relevant and my friend said says Dr Reece said he was not the relevant one. 

That was the evidence on which they went – proceeded.  They did – I accept they did not have to find the best but they did have to persuade the court that the skilled addressee would have chosen Watanabe when they just had to get through 7(2).  The way they chose to persuade the court was by that evidence.

FRENCH CJ:   Why do you say put it in terms of choice – is it not sufficient for the statutory task that the skilled addressee accepts Watanabe as relevant within the meaning of section 7(3)?

MR BANNON:   It is sufficient to get it into 7(2), prior art base – I accept that.  Can I just interpolate this as my answer to your Honour’s question – having regard to the way the debate has developed, although en route we had some complaints about getting those publications into the ascertained, I do not pursue those because I think the way it has crystallised is sufficient for us to see the point of principle in contest as I have just said, namely, they require - we say they require that extra knowledge of what is in the other publication to choose.

But coming back to your Honour’s question – with the benefit of common general knowledge and, say, Watanabe as an extra piece of information, what the court has to be satisfied that the skilled addressee would have – when I say chosen, would have proceeded down the Watanabe route.  It is not – because it is not a case of once you get it in there that that is the only route to be considered.  That is what we say the flaw is in paragraph 536 of the Full Court’s reasons.  They seem to proceed on the basis that once it is in there you proceed down that route.  We say that is probably informed by the expert’s knowledge.  They say this is the most relevant.

KIEFEL J:   You can apply subsection (2) to the Watanabe document as the one document of prior art, then you can apply it with common general knowledge to Aoki as separate exercises. 

MR BANNON:   Yes.

KIEFEL J:   Your argument seems to be constructed on the idea that there is one only document which must be chosen out of all of them as the best and then that is the test, whereas these are individual tests, are they not?

MR BANNON:   If I have given that impression I do not submit ‑ ‑ ‑

KIEFEL J:   Perhaps I have misunderstood.

MR BANNON:   No, your Honour, I do not say that.  I was really seeking to emphasise that we fully accept that once you get – the relevant one has to be Watanabe because that is the route to the invention.  Your Honour is absolutely right ‑ ‑ ‑

KIEFEL J:   The rest fall by the wayside.  That is so.

MR BANNON:   That is right, your Honour is absolutely right.  If it was a case about the 471 product, then we are having a similar debate but substitute 471.  We fully accept – and now to the extent I have troubled the Court otherwise I accept they would find and ascertain Watanabe and 471.  We fully accept that the task then is in section 7(2), armed with just CGK and Watanabe, what would the skilled addressee do? 

The point of debating their evidence – at that point the court has to conclude that the skilled addressee, faced with the problem which we have seen identified, would have said I will pursue the product in Watanabe.  The mere fact you get Watanabe into the prior art base does not dictate that the skilled addressee would follow Watanabe, and that is the passage in Lockwood and other cases to say you have still have to ask – look forward, what would they do from there?  That is the issue. 

They chose to prove it in a way which was impermissible.  The only way they chose to prove it was to say they would do the preference, and we say that is impermissible, and that is the point of principle which divides us.  So if you cast that to one side, then one is left with the question how do you go – what is the answer to the question as to what would the hypothetical skilled addressee, and not these two gentlemen because they did not answer the question, what do you do from common general knowledge about Watanabe. 

One of the other points we have made was there is no evidence from either of these people – none presented to the court to address this very question.  What would a skilled addressee do if – just had common knowledge and just said here is Watanabe.  What would you do in that circumstance faced with the problem?  That is the evidence which they should have led, and I said there was no evidence of that.  There was deathly silence in response to that, they have not responded to that.  We say that is an evidential gap.

Why is it a gap - because, although there may be some cases where if you have got common general knowledge and a complete answer to a solution, if it is a specific solution, how do you unlock a door or whatever, if you are trying to unlock a door, the court can say of itself, because it is a question for the court ultimately, well, there is the answer, of course a skilled addressee would do it. 

But that is not the problem here.  The problem is not to find one specific statin.  The problem is, faced with the market which we have seen, what would a skilled addressee do to find something?  The court is bereft of that evidence on that specific question, putting aside inappropriate comparisons.

NETTLE J:   Well, you have very astutely avoided asking the question in cross‑examination, as you pointed out yesterday ‑ ‑ ‑

MR BANNON:   Yes.

NETTLE J:   ‑ ‑ ‑but then the response to that was if one goes to the evidence in‑chief it is plain that they would have gone down the route of Watanabe.

MR BANNON:   Only because of their preference, their comparison preference, which is impermissible.  But what one is left with as evidence which is undisputed is that both these experts say, if I was faced with this problem, I would do a literature search.  So now I know I ‑ my learned friend ‑ ‑ ‑

KIEFEL J:   I thought we had got past that, we had ascertained Watanabe.

NETTLE J:   It has been reborn in a new light, has it not?  It has moved the debate from where it was yesterday into the new sphere.

MR BANNON:   I certainly have confused my learned friend, Mr Catterns, and I probably have confused the Court.  My learned friend submitted we could not have an extra search and use the product of that search.  We agree.  I do not think – if that sounded like what I said, it was not intended, because plainly that extra product of the search would be non‑common general knowledge.

Our point was simply this, that if, in answering the question, as I say, with common general knowledge and this extra knowledge, you have to ask would a hypothetical addressee stand there and say I know this, that is good enough for my purposes, I will go down that path.  What is the evidence to support that conclusion?  We say zero. 

KEANE J:   But the way you were putting it, the way you are using this question about what would the skilled addressee do, it is almost as if you are suggesting that the skilled addressee has to be sufficiently motivated by the document to decide that it is worth pursuing.

MR BANNON:   Yes.

KEANE J:   Is it not really just that the skilled addressee, with the knowledge, can proceed in a routine way to the answer?  You do not worry yourself about whether or not they are sufficiently motivated to do it.

MR BANNON:   Sorry, yes.  I answered yes when your Honour framed it as a motivation question.  The question is – and that was probably – the question is what would a skilled addressee, faced with the problem, do because you have got to get from that prior art base to a method of treatment.

KEANE J:   It is would the skilled addressee, with this information, be able to proceed in a routine way to the answer?

MR BANNON:   We respectfully submit it would proceed – has to be would.  Was it obvious to go from this ‑ ‑ ‑

KEANE J:   So you do say it is about motivation?

MR BANNON:   Well, the language of obvious to do – go from the prior art base to the invention – bear in mind, bear in mind, as the skilled addressee is standing there, the skilled addressee does not know the invention is rosuvastatin, 10 to 15 grams.  The addressee is not standing there saying the problem is you have got to find a treatment using rosuvastatin. 

KIEFEL J:   No, but Professor O’Brien’s evidence tells us that the skilled addressee could see what appears to be an efficacious drug and the next step is to look for results of testing.  That is the next step.

MR BANNON:   He can see an efficacious drug?

KIEFEL J:   But you say testing stands in the way of being directly led to dosage.  That is really the area for debate, is it not?

MR BANNON:   Well, I always had two lines of trenches, I have three.  The last line is dosage and ‑ ‑ ‑

FRENCH CJ:   It is not World War 1.

MR BANNON:    ‑ ‑ ‑ I stand firm with such of my compatriots who wish to join me but I also stand on an anterior point, namely, that the court should not be satisfied and was wrongly satisfied on incorrect evidence that the skilled addressee - it was obvious to use rosuvastatin to solve the problem.  My first trench is getting the two and I have abandoned it.

FRENCH CJ:   You seem to be posing it, in our little notional world where this skilled addressee is sitting there with his common general knowledge and Watanabe and maybe something else, you seem to be posing it as a volitional question, when really the statute poses what seems to be a cognitive question.

MR BANNON:   Was it obvious to solve the problem of a statin which would ideally - in effect, one dose solve the dose titration problem, for example.  Was it obvious that assuming that they have Watanabe, that they would simply select Watanabe and work out a dosage?  We say there is no evidence that it is obvious and it is not obvious.  One of the reasons we say it is not obvious you do not – they would sit there and say well, that is one thing, but this is a crowded statin market and I want to make sure I have got the best.  On that regard, we do have the evidence ‑ ‑ ‑

FRENCH CJ:   Cannot you say in the hypothetical situation I might be able to do better, but this is one obvious answer?

MR BANNON:   But it is not an obvious answer to provide the benefits which the patent ultimately has demonstrated you do provide.  It may or may not.  Anyway, we say that is the issue. 

FRENCH CJ:   I am just trying to identify the way in which the question in the notional world should properly be framed.  I am not suggesting what the answer is.

MR BANNON:   Yes.  Well, would it be obvious to the skilled addressee faced with common general knowledge and with the benefit of Watanabe to solve the problem of a particular statin, unidentified statin, which would provide the particular benefit, which we have talked about.  Was it obvious that they would, without more, simply head down Watanabe?  That is the issue before the Court. 

They called evidence to explain why it is the hypothetical skilled addressee would take that step directly down Watanabe.  We say that evidence was tainted for the problem I have realised.  Then you are left with what evidence is there?  We say there is none and this is not the time for the court – the first substitute – this Court to make that factual finding. 

To the extent one needs to pray in aid what the court does know, what the court does know is that when people are faced with these – because of the risks of clinical trials, because of the uncertainty, just merely looking at that product rosuvastatin, you do not know whether it is going to work because of all those risk factors involved and this is the risk and reward of patents, they say we will always do a search, it is the first thing we do.

So that in other words, it is the real world of what the – it is a fictional person, but it is in a real world.  That is what Lockwood says.  You have to look at the evidence and the real world.  The real world is, in this industry, as they have demonstrated, you do not just go down – plunge off a cliff in search of this.  You might if it was absolutely ridgy‑didge, all the trials had been done and it satisfied, ticked all the boxes.  You do not do that.  The first thing you do is, as I say, we do a search.  That is our point.

KIEFEL J:   Is there a difference, though, between being proved to be correct in the ultimate result and being led to an invention?

MR BANNON:   Well, this has to be – it is obvious to try in the expectation of ‑ ‑ ‑

KIEFEL J:   What I am talking about is the very expensive clinical trials that you are talking about, whether or not you can be led to the invention on the basis of much less material than that, in this case.

MR BANNON:   Well, I think – the test is – I keep leaving out an important word – directly led as a matter of course to try rosuvastatin in this case in the expectation that it might well provide the invention as claimed, namely 5 to 10 treatment - directly that, as a matter of course – so that is why – if you frame it that way ‑ ‑ ‑

KIEFEL J:   Why is Professor O’Brien’s evidence not indicative of that?

MR BANNON:   Only for the reason I have already indicated, namely, there is no evidence to say if you have common general knowledge and Watanabe that you would – nobody says if that is all I had then I would directly be led, as a matter of course, to try that.  I would not consider any other possibility.

NETTLE J:   He does say that he has the benefit of Aoki.

MR BANNON:   Yes.  He only says that because he has taken the impermissible step, or been permitted.  I do not criticise him, but that is the issue.  So it does raise an important issue of principle if you are – are you allowed to or not use that extra bit of knowledge – one accepts it is on that.  Then we are back, I suppose – I should not say I suppose – in the question your Honour the Chief has posed, for the reasons I have indicated, this Court should not now for the first time answer that question and there are good reasons not to.  They have not proved their case so they carry the onus all the way through.  So that is the reply on 7(3). 

Could I then go to the entitlement?  The ground of revocation not the inventor must be established by the revoker.  The onus always lies on the revoker from pleading to conclusion of submissions.  The revoker, as a practical matter, must assert that the named inventor – in this case an employee of AstraZeneca – was not the inventor and identify who it was who was the inventor. 

The respondents did exactly that.  They asserted that employees of Shionogi were the inventors and that Shionogi was the entity entitled to the patent.  That appears from the primary judge’s reasons at volume 5, paragraph 273 at 1912.  That records the submission:

The generic parties contended that the invention in the low dose patent, the use of a 5 to 10 –

the selection of those –

was invented by employees of Shionogi, none of whom are named as an inventor.

That was their positive assertion to the court.  Secondly, at 1914 at line 40, her Honour sets out the written submission of the generic parties:

It is thus clear that Shionogi had not only invented rosuvastatin . . . its scientists had also conceived of a method of treating hypercholesterolaemia comprising administration –

So they positively asserted that was the dosage.  In reliance on the evidence which they led and the evidence which we led, based on that, the primary judge made a finding of fact that Shionogi, by its employees, invented - that appears at 1917 at paragraph 291; it is the last couple of lines, including a finding that it was Shionogi who had invented the 5 to 10 milligram doses.

That is a factual finding which was confirmed by the Full Court at paragraph 143 of their judgment at 2475 after we challenged it.  In this Court, that is a factual finding which stands unchallenged.  The respondents say that AstraZeneca ought to have obtained an assignment at some point before the conclusion of the trial.  The word “ought” suggests a failure.  There is no suggestion that AstraZeneca did not genuinely believe it was the inventor, or that it unreasonably resisted the “no inventor” ground, either at trial or on appeal.  As noted in our submissions, paragraph 72, Shionogi did not ever claim to be an inventor.  The primary judge referred to that in paragraph 287.

In those circumstances it is difficult to see why AstraZeneca ought to have taken a view contrary to its own and Shionogi’s apparent view, merely because the respondent had raised the ground of revocation.  Nevertheless, let it be assumed an assignment had been taken before the conclusion of the trial.  It would have been, as it is now, without prejudice to AstraZeneca’s denial of the lack of inventorship claim.  At that time of that assignment it could have had no impact on the inventorship issue because section 22A was not in force.

Further, there were two Full Court authorities referred to in the Full Court here at paragraph 158 at page 2478 – namely Stack v Davies Shephard, University of Columbia v Medsystems which said title at grant was essential, getting in title after the grant of patent was ineffective.  Pausing there, if we had taken an assignment – if it had existed, it could not have been received in evidence at trial.  It was inadmissible.  It was irrelevant to any issue, could not change the inventorship outcome because of the Full Court decision and because 22A did not exist.  It was just an irrelevant piece of paper.

The interlocutory application which is resisted is to receive evidence.  It is evidence which could not have been admitted at trial.  The respondents say we could have argued Stack and Medsystems were wrong.  There is no suggestion that they are wrong or that any of AstraZeneca, or its lawyers, ever thought it was wrong or even now think it is wrong. 

The respondents say they lost the forensic advantage by AstraZeneca not tendering evidence which could not have been received at trial.  It is an illogical proposition.  Even if AstraZeneca had entered into the assignment before the end of the trial, being inadmissible and irrelevant to any issue, there would have been no obligation to disclose it and it would not have been disclosed. 

So this forensic advantage now descends to a loss of advantage arising from an assignment of which they would have had no entitlement to know about and would not have known about.  Moreover – I am sorry, your Honours, if I could just finish on this last point – the asserted loss of advantage is the lost opportunity we now understand of proving that Shionogi was not the inventor, but someone else was, that is to say, the lost opportunity of proving something which is contrary to the factual finding of the Federal Court, on evidence, which is unchallenged and which they promoted.  That is not the loss of a legitimate forensic advantage, namely, to prove the contrary of a found fact which they themselves used.  Not only is it speculative and without foundation, but it borders on the mischievous, if I may say so.

FRENCH CJ:   Now, how much longer do you think you will be, Mr Bannon?

MR BANNON:   About an hour – I have to deal with the starting point which is a very significant issue for many reasons but ‑ ‑ ‑

FRENCH CJ:   The Court will adjourn until 2.00 pm.

AT 12.48 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.00 PM:

FRENCH CJ:   Yes, Mr Bannon.

MR BANNON:   Thank you, your Honour.  Just finishing up on the entitlement re discretion, there was also a suggestion that AstraZeneca should have had their hearing or trial adjourned on the basis of what we say would be inadmissible evidence.  We say it is equally illogical – furthermore, the trial was expedited at the respondents’ urging because interlocutory injunctions were in place.  The judgment was delivered on 5 March 13.  Section 22A came into force on 15 April 2013.  The assignment was made after that.  There is no discretionary reason for not admitting the evidence.  There is a powerful discretionary reason for admitting it if we are otherwise successful on the appeal.  Could I then deal with the topic of the starting point and invite attention first of all to section 18.

FRENCH CJ:   Well, when we talk about starting point, do we talk about anything other than the way the invention is described?

MR BANNON:   Yes.  Sorry, our learned friends say inventive, as we understand it, and the primary judge said the question of inventive step is determined by language in the specification.  That argument – analysis of the primary judge and indeed my friend’s submissions in this Court do not attend to the statutory language.  They do not explain how it is that that notion can be grafted on to the statutory language, for the simple reason, this, that the claim is for a method of treatment using a particular compound.  They have to show that combination of features involved no inventive step, no obviousness.

As we understand the primary judge’s reasons and the argument our friends wish to put forward it is that what is tested is something less than that, namely the inventive merit or concept in that which they say is just the uses of dosage and somehow or other – and they say - I should not say somehow or other – and they say, as we understand it, you do that by first looking at the specification, analysing the specification and saying notwithstanding the claims include integers (a), (b), (c), (d) and (e), when you test inventive step you just look at something less than that. 

We say in very brief terms the Full Court’s reasoning is entirely apposite.  It addresses the language of the legislation.  It recognises that there is no way of grafting the respondent’s concept into the legislation.  I was going to seek to demonstrate that.  If one starts with section 18, the patentable invention, under the heading it says:

(1)Subject to subsection (2), a patentable invention is an invention that, so far as claimed in any claim –

They are key words –

(a)      as a manner of manufacturer . . . 

(b)when compared with the prior art base as it existed and before the priority date of that claim:

(i)is novel; and

(ii)involves an inventive step –

So the comparator, the legislation directs, is between the invention as claimed in any claim, and that comparator must logically bear the same meaning for each of (a), (b), (c) and (d), and in particular within (b)(i) and (ii), and (c) is relevant as well.

No matter what an inventor says in the body of the specification, if the inventor claims as part of the claim – in this case, rosuvastatin used in a method of treatment in particular dosages – when that is the invention so far as claimed in any claim, so it includes the integer rosuvastatin, the use in treating hypercholesterolemia at the specified doses, each of those integers must be satisfied.

Therefore, when one tests the question of novelty – and I will come to section 71 – no one has ever suggested a novelty other than you must find each of the integers that are claimed in a single document or a single act.  Exactly the same analysis applies to the comparison against the prior art base; you compare the combination of all the features against the prior art base.  The same relation to “useful” is useful.  There is a concept, which we have referred to in our submissions, so your Honours are familiar with it, namely the claim is bad for inutility if any version which is captured by the words of the claim does not work.  That is not useful.  Again, whether that is satisfied or not depends on looking at the integers as defined.  The next step, having observed that in relation to section 18, one then goes to section 7, and 7(1) says:

For the purposes of this Act, an invention is to be taken to be novel when compared with the prior art base unless it is not novel in the light of any one of the following kinds of information –

which we have identified.  So taking section 7(1) and reading that with section 18 that is saying a patentable invention is an invention so far as claimed in any claim when compared with the prior art base.  It is novel.  The relevant prior art base is as identified in 7(1).  But the significance of that is you have to deal with and find in the prior art base if you are going to succeed in attacking, for want of novelty, every single one of those features.  A fortiori, when one comes to subsection (2):

For the purposes of this Act, an invention is to be taken to involve an inventive step when compared with the prior art base unless the invention would have been obvious –

The invention, which has to be obvious, is the invention so far as claimed in any claim, that is, you have to look at the combination of integers.  So the question of obviousness, no matter what language is used in the body of specification, is not what the inventor says - I only thought I did something clever by doing the dosage – let us say that was said there – that would be irrelevant to the test.

If the test – if the claim was claim for use of rosuvastatin with the other integers, the combination of claims is the combination of features, the invention has to be tested against the prior art base.  That is a very simple and short answer to the starting point.  It is the answer which the Full Court provided.  But there is confirmation of that in relation to section 40 – I think my learned friend relied on section 40.  If one goes to section 40, it says:

A complete specification must:

(a)      describe the invention fully . . . 

(b)      where it relates to an application . . . end with a claim –

and this is the critical one – sorry, (2)(b) is the critical one for present purposes –

end with a claim or claims defining the invention –

When section 18 refers to the invention “so far as claimed in any claim” it is effectively tracking, or recognising that there is a requirement that the claim define the invention.  This Court has said on two occasions at least that when section 40 talks about the invention “so far as claimed in any claim” it is not talking about inventive step, it is talking about the embodiment, effectively, what is asserted to be the invention.

We have taken the liberty of handing up to your Honours – I am sorry, we have not taken that liberty – just a couple of copies of Kimberly‑Clark v Arico Trading and Lockwood (No 1).  In Kimberly‑Clark 207 CLR 1 at 14, paragraph 21, there is a passage referring to a passage from Mr Blanco White QC in his work. Over the top of the next page there is the word “invention”; it can have different meanings. They identified four possible meanings. The first one is:

The embodiment which is described, and around which the claims are drawn.

That would be, for example, a preferred embodiment in the case of a product claim; in this case, it would be the method of treatment one would seize in one of the consistory clauses –

This is the sense used in the Act . . . ‘the invention so far as claimed in any claim’–

is used.  Then –

2. The subject-matter of a claim – especially that of the broadest claim.  3. The inventive step taken by the inventor.  4. The advance in the art . . . 

It is the first meaning which, with respect, McTiernan J correctly adopted in construing s 40(1) of the 1952 Act –

That is the part of the Act which defines the claims.  So they specifically say that the invention, so far as claimed in any claim, is not referring to inventive merit but simply the definition of the invention.  Exactly the same point was made in Lockwood (No 1) in, firstly, paragraph – Lockwood v Doric 217 CLR 274, firstly, at page 290 at paragraph 44. This is now dealing with the current Act with which we are concerned. It refers to section 18:

Section 18 sets out the requirements which go to the nature and subject matter of patents.  In contrast, s 40 . . . deals with the filing, examination . . . Section 40 sets out requirements that are certainly important:  in the specification, patentees give the public directions about how the advantages . . . The requirements of s 40, however, unlike those of s 18, say nothing about the nature or subject matter of patents, and go more to the form that specifications must take.

Then, paragraph 53 over on page 293, the Court said:

Further, conceptions like “inventive step”, “merit” and “technical contribution to the art” –

May I overlay language put forward on the so‑called starting point argument – what was the real advance, what did the inventor actually do:

find no support in the statutory language of s 40(3).  Section 40(1) speaks of a provisional specification describing “the invention” and s 40(2)(a) speaks of a complete specification describing “the invention fully”.  Section 40(2)(b) speaks of the claims “defining the invention”.

That is our claim, relevantly.  Then 40(3):

Although s 40(3) does not use the word “invention”, this context suggests, and the parties agreed, that the requirement in s 40(3) that the claims be fairly based on the matter described in the specification is a requirement that they be fairly based on the matter in it that discusses the “invention”. . . In s 40(1), “invention” means “the embodiment which is described, and around which the claims are drawn”.

It picks up footnote (64) and that picks up that passage of Kimberly‑Clark that I took your Honours to:

It has the same meaning in s 40(2).  So far as 40(3) implicitly refers to an invention, it must bear the same meaning there.

It does not there mean an “inventive step”.  So, in the briefest of terms, one asks how does one graft – it is purely a question of statutory construction – how does one graft the primary judge’s approach or the argument of the respondents into those words of the legislation and there is, with respect, no way of so doing.  It is the clear meaning of the legislation and one cannot even imagine words which one could use or how one could push this concept into it. 

My attempt at it would be to say, when you read in relation to the words “invention so far as claimed in any claim” in relation to inventive step, unlike novelty, you ignore an integer of the claim which, on a reading of the specification, because the drafting exercise or whatever, the inventor says, “I did not invent that part of it” there is no root of statutory construction which can achieve that aim.  Then, if I could then go to the Full Court’s reasoning which is in volume 7.  The discussion starts at 2485 and 192, 195.  This is the exact point which the Full Court makes, and rightly so, with respect:

The words “the invention, so far as claimed in any claim” as they appear in s 18(1)(b)(ii) also appeared in s 100(1)(e) –

I do not want to excite the Solicitor‑General too much, but that is a correct observation –

Their purpose is to direct attention to the invention as defined by the claim.  In assessing novelty or obviousness, the focus is on the claim as construed in light of the complete specification read as a whole and the common general knowledge as it stood at the priority date of the claim.  In particular, in assessing whether or not an invention was obvious and, consequently, lacking an inventive step, the relevant inquiry is whether anything within the claim . . . would have been obvious –

That is, not embodiments describing the invention, i.e., something which is defined by the claim.  Then their Honours proceed to identify what the patent area is in the prior art base and at 198 on page 2487 they say that is the prior art base and it is just an objective comparison between the definition of “invention” against that.  Then at paragraph 200 they say:

To be patentable, an invention, so far as claimed, must involve an inventive step when compared with the prior art base –

Then paragraph 202:

Accordingly, whether a claim of a patent is invalid for lack of inventive step is to be determined by comparing the invention, so far as claimed, against the common general knowledge and any s 7(3) information.  The question is then whether the invention would have been obvious to the hypothetical person skilled . . .   So understood, it is apparent that the relevant provisions of the Act do not expressly or impliedly contemplate that the body of knowledge and information against which the question whether or not an invention, so far as claimed, involves an inventive step is to be determined may be enlarged by reference to the inventor’s (or patent applicant’s) description in the complete specification . . . 

If the problem addressed by a patent specification is itself common general knowledge . . . then such knowledge or information will be attributed to the hypothetical person . . .  But if the problem cannot be attributed . . . then it is not permissible to attribute a knowledge of the problem on the basis of the inventor’s “starting point” such as might be gleaned from a reading of the complete specification as a whole.  There are a number of reasons why this should be so.

These are really supplementary reasons which we rely on but I will not track your Honours through 204, 205 and following, all relevant.  Paragraph 208 identifies the difficulties of some alternative unauthorised, I emphasise, statutory process of trying to work out what is the starting point.  Is it rosuvastatin on its own?  Is it rosuvastatin plus some other information?  Is it rosuvastatin, for example, plus the information they got from Shionogi, even though it is not referred to it?  Is that the real inventive starting point? 

There are so many questions which it poses, and this is an issue – before the Full Court’s decision to remove this, it was an issue which, quite frankly, bedevilled patent cases because revokers would repeatedly say, look at the specification, do not worry about common general knowledge, look at what they did, and there would be a great debate as to what the inventor did.  It is just an illogical – well, (a) it does not keep with the statute, that is the beginning and end of it, but it is an illogical proposition, in any event.

It is illogical for a number of reasons.  One could have, for example, just to take a homespun example, there may be some inventor who is a complete genius and he was trying to develop some product, takes the product up to a point which needs something, and he cannot get the last bit.  The last bit is blindingly obvious to the most unskilled worker in the history of the world.  He records in his patent specification “I have got this device X; I just could not get over the line.  My big problem was getting over the line with this last bit”.  They come along and say “You started with that; that was a very simple step to take to the next step.”

That is completely logical in circumstances where the first part of the device was not part of the common general knowledge.  The examples of coming up with a patent in a dream are appropriate.  It involves no skill or judgment whatsoever.  You may stumble across a beach where flotsam has been washed up in a particular format which is the solution to some complicated problem.  You just happened to be there, it was blind Freddy could have - you drew it and you had it. 

It is irrelevant.  It is always an objective test against the invention as claimed versus the common general knowledge plus authorised statutory additions.  It is an easy way to do it – we have had debates about it – but it is a recognised standard; it is the relevant standard.  So that is our submission, and it is an extremely important point, but we say everything that the Full Court said in relation to the matter is absolutely right.

Their treatment of Wellcome in paragraph 215 is absolutely right, and their treatment of Alphapharm, that it proceeded on a concession, is also absolutely right.  It is right from a reading of the Act and its reading from the decision.  For what it is worth, it is right that Justice Yates sat on the five‑member Bench and was a party to the team which actually made the concession, but it is probably extra‑curial.

That does not mean the concession was wrong, concessions are often made in proceedings – sorry, forensically wrong – concessions are often made in proceedings for a view that it made the case more interesting, for example.  It might have got special leave where they might not have got special leave, there are a whole host of reasons. 

Then I was going to just take your Honours briefly to an active demonstration of why it is the claims define the invention.  In Lockwood (No 2) 235 CLR 173 at paragraph 143 there is a reference to a claim 13, which follows reference to a claim 1. The only point to note is that claim 13 was a narrower claim. Then at 148 on page 221, their Honours observe that:

It is not to be doubted that ss 7(2), 7(3) and 18(1) read together provide that each claim needs to be examined independently of the other claims when considering whether an alleged invention involves an inventive step.  It is also axiomatic that an alleged invention in a combination of integers which constitutes a solution to a particular problem must necessarily involve rejecting other combinations –

So there is another example of courts saying when you look at claims, each claim so far as claimed in any claim you compare that against the prior art base.  Then they say the same thing as the Full Court said here, in the next paragraph.  You compare that against the prior art base – that is paragraph 149.  If I could then jump over to page 225, at 166, their Honours conclude:

It is not, strictly speaking, necessary to go further.  But let it be assumed that the information qualified for inclusion in the prior art base . . . On that assumption, the question which s 7(2) requires to be asked is:  “If that information had been considered by a person skilled in the relevant art together with common general knowledge would the invention in claim 13 have been obvious?”

The answer was “no”.  Then, over at paragraph 169 at page 226, their Honours say:

Although it is not necessary to this appeal to make any determination in respect of claim 1, a comparison of the information disclosed by the sale of storeroom locks with the combination of integers in claim 1 –

might well lead to a different conclusion.  In other words, you can have different conclusions.  Plainly, on novelty grounds, you can have different conclusions on inventive step, depending on the definition of the invention per individual claims.

In the respondent’s case, as we understand it, you define the inventive step for all claims by one nebulous inventive concept.  Could I then very briefly go to the – we, perhaps like the learned solicitor, do not say it is necessary for the Court to decide whether Apotex v Sanofi is wrong, it is a different Act, but we only respond to submissions made by the respondent who prayed in aid in support of their consideration of this Act, so I just preface my remarks in that regard.  If I could take your Honours just to a couple of passages in that.  So that is Apotex v Sanofi 82 IPR 416 at, firstly, page 441, that is the starting point for the assessment, and at [152] their Honours say:

Section 100(1)(e) makes it clear that the question to be addressed is whether the invention, so far as claimed in the particular claim, is obvious and does not involve an inventive step.  That requires a determination of the invention, as described in the specification.  What is claimed may then equate with, or be less than the totality of or scope of, the invention.

That is the error.  The proposition that it “requires a determination of the invention, as described in the specification” – no, it does not.  It requires a consideration of the combination of integers identified in the claim.  Their Honours go on the say:

What is claimed may then equate with, or be less than the totality of or scope of, the invention.  The specification of the patent makes it clear that the selection of [the compound] . . . formed no part of this invention . . .  From the primary judge’s reasons, no such claim was made.  It was the process of separation [which] . . . were the subject matter of the claims.  The invention to be assessed for obviousness is ascertained from the patent and the obviousness or inventive step of the invention as claimed is then assessed by reference to common general knowledge –

So they assess the invention as the ease of separating the enantiomers of a racemate compound, whereas the invention was an enantiomer of a particular compound.  What they did was tease out one of the integers, the enantiomer part, and ignore as part of the combination of the invention, the compound.  I will take your Honours briefly to the 1952 Act.  Curiously enough, of course, when they dealt with novelty in the same case, they dealt with it in the orthodox way; they asked whether all of the integers of the same claim appeared in a prior document, which included, of course, the compound itself.  If I could take your Honours to the 1952 Act to just make that point, to the relevant ‑ ‑ ‑

FRENCH CJ:   Are their Honours construing the claims by reference to the determination?  Is that what they are saying in 152, or are they saying more than that?

MR BANNON:   There was an issue of construction which went to novelty, and they found every integer ‑ ‑ ‑

FRENCH CJ:   I am just wondering what in fact they are saying, whether they are saying that you find the invention in the specification, although really it is directed to what is in the claims.

MR BANNON:   Well, the outcome in the case was we succeeded at first instance on the inventive step because the compound itself was not part of the common general knowledge.  We lost – not personally, but my client ‑ ‑ ‑

FRENCH CJ:   It is always the client who loses.

MR BANNON:   ‑ ‑ ‑for whom I was not there to defend for some, no doubt, not very good reason – lost because the Full Court accepted that it was not part of the common general knowledge but, nevertheless, said it did not matter because it was part of the inventor’s problem, and that because the inventor assumed, or started with the compound itself, even though nobody else had it in the common general knowledge, the little bit to be tested as to whether or not it was inventive was the movement from the compound to separation of the enantiomers.  Your Honours may have come across racemates before that – there was a whole list of compounds which consist of yin and yang enantiomers and you separate them into different enantiomers and add the same chemical qualities, but they have different therapeutic features or…..Anyway, that was the particular exercise and the court – and it was accepted that the actual separation process was not that complicated, but because of that reason, the court said there was no – it was obvious.

NETTLE J:   It was on all fours with this case, then.  The very point is on all fours with this case.

MR BANNON:   Pretty much, yes.  Well, except we say for the dosage reason it is not obvious.

NETTLE J:   Assume, against you, that were not so, it all comes down to whether selective rosuvastatin is part of the invention.

MR BANNON:   Yes, correct.  Absolutely.

NETTLE J:   Could I just ask you, by way of clarification, if you look at the first claim in the patent in this case, it is, amongst other places, at 2440 of the appeal book.  It says:

A method of treating a patient suffering from hypercholesterolemia –

with 5 to 10 gram dose, on a daily basis.  Looking at that, and asking yourself what is the invention which is bespoke in that claim – are you entitled to read it as a method of treating a patient suffering from the disease by administration of a single daily dose of rosuvastatin?

MR BANNON:   Rosuvastatin, yes.

NETTLE J:   You are?

MR BANNON:   Yes.  If one thinks of it as the capital of Fiji, it is easy to get the pronunciation.  Rosuvastatin.

NETTLE J:   Yes.

MR BANNON:   But that is exactly right, if I may say so.  Your Honour, it is a method of treatment claim, and it has as essential features a treatment of the relevant disease, secondly the use of a particular compound, rosuvastatin, and thirdly in particular dosages.

NETTLE J:   So you claim novelty in the selection in part of the rosuvastatin?

MR BANNON:   We do not subdivide it that way.  We claim a novelty in that combination of features.  That is the invention so far as ‑ ‑ ‑

NETTLE J:   It would have to be in part, though, the selection, would it not?  Otherwise, it cannot be part of the totality.

MR BANNON:   Well, that is where it just comes down to the statutory test.  The invention, so far as claimed in any claim ‑ ‑ ‑

NETTLE J:   Yes.

MR BANNON:    ‑ ‑ ‑ is that combination of features.

NETTLE J:   Well, do you claim in claim 1, at least in part, that you were smart in selecting rosuvastatin?

MR BANNON:   Well, we say, it is not a question which is relevant to be answered – could I say that politely?

NETTLE J:   Do you claim novelty in part in the selection of that particular drug?

MR BANNON:   If the claim was only rosuvastatin, it would not, as a matter of fact, be novel because there was a prior publication which identified the compound.  So, therefore, then applying the statutory test, the claim – the invention so far as claiming any claim would be rosuvastatin per se, so that would be the first part of section 118(1).  One would then go and look at the prior art base under 7(1) and the prior art base would include a publication which is available to be used to compare, for novelty purposes, if one sees rosuvastatin in there, the claim is bad.

Come forward to this case, the combination of a method of treatment of rosuvastatin in particular doses is for the treatment of the particular disease is a combination of three things and if that combination is novel – and that is novel because one cannot find it anywhere and in any prior publication. 

So it is not a question of whether we are smart of doing it.  That is the combination which is assessed on a novelty basis, firstly, and then on an inventive step basis, the test is simply – following the statutory test – the revoker has to establish that it was obvious for the skilled addressee to move from the prior art base, which we have discussed – common general knowledge plus – to move from that to that combination which includes rosuvastatin.

NETTLE J:   So if it had just been the selection of the drug, that would not have been novel.

MR BANNON:   Yes.

NETTLE J:   Because it is the selection of the daily dose of 10 milligrams of that drug, it is novel.

MR BANNON:   Yes.

NETTLE J:   That is because in part, what is novelty in the selection of the rosuvastatin ‑ ‑ ‑

MR BANNON:   No, because we do not have to say there is a quality of novelty in the selection of rosuvastatin.  They have to show that that combination of features appeared in a single publication, or an Act, before the priority date.  If they do not, we are deemed to be novel.  We do not have to demonstrate, or positively prove, or even assert that we are clever in selecting.

FRENCH CJ:   That goes into inventive step.

MR BANNON:   Yes, but even in inventive step, we do not have to prove any particular cleverness.  All we have to resist is the application of the statutory test.

NETTLE J:   I erred in injecting “smartness”; I meant “novelty”.

MR BANNON:   No, but it is a concept which has recurred; Lockwood (No 1) was a good example where the Full Court there had said there is no inventive merit.  In that case it was – just looking on the face of the specification, a similar point came up in Advanced Building Systems – I always seem to be associated with these things – whereas the Full Court said just adding a piece of string to an existing piece of equipment had no intrinsic inventive merit and was not particularly clever.  But in each case, the Court says that is not the question. 

That is not looking at some genius step; it is not a positive step to be looked at.  It is a relatively mechanical test.  You ask what is being claimed; is it novel; look at the prior art.  On the inventive step case, you ask was it obvious for a skilled addressee to move from that state of the art to that combination of features.  It is no more, no less.  Questions about whether it is smart or not to do so is not really part of it.

NETTLE J:   It is very troubling that there is no novelty in the selection of rosuvastatin and, yes, there is in a selection of a 10 milligram daily dose of it.

MR BANNON:   There is novelty in selecting the use of rosuvastatin in a treatment of hypercholesterolemia in 5 to 10 milligrams dose.  That combination is novel as a method of treatment.

NETTLE J:   Thank you.

MR BANNON:   So, just coming back to section 100 of the old Act, section 100(1) says:

A standard patent may be revoked, either wholly or in so far as it relates to any claim . . . on one or more of the following grounds –

Then, (f):

that the invention, so far as claimed in any claim –

Sorry, not (f) – (e) ‑

that the invention, so far as claimed in any claim . . . was obvious and did not involve an inventive step having regard to what was known or used in Australia on or before the priority date of that claim –

“Known or used” in 3M, Minnesota Mining, they said, “known or used” means common general knowledge.  It is not just found in a library, you cannot mosaic, it is part of the ordinary equipment of the skilled user.  Then, for completeness, (g):

that the invention, so far as claimed in any claim . . . was not novel in Australia on the priority date of that claim –

Similarly, as to the current Act, section 40:

A complete specification must:

(a)describe the invention fully, including the best method . . . 

(b) . . . end with a claim or claims defining the invention –

Kimberly‑Clark was referring to the section 52 Act.  Lockwood picked up and applied the same approach to section 40 as it appears in the 1990 Act.  So, as I say, we do not say that this Court has to decide…..wrong, but if your Honours ask me what my submission is, it was wrong and if it adds anything, plainly so.

I think my friends’ reliance on your Honours’ decision in the Gray Case about who was the inventor – that is a different issue.  Inventive concept has a relevance there – who makes a contribution to the inventive concept – that is not the same thing we are talking about here.  It might well bear on the issue which your Honour Justice Nettle raised but as to who is the inventor, who contributes to the ‑ ‑ ‑

FRENCH CJ:   Yes, there was a serious lineage problem in that case, I think.

MR BANNON:   Yes.  Then could I move to manner of manufacture?  We submit, firstly, it would be a rare case indeed – and it is hard to imagine one – that one could come to a different conclusion on obviousness, with the benefit of evidence, but yet find on the face of the specification the patent involves no inventive step.  A Full Court of the Federal Court so said in Bristol‑Myers Squibb v Faulding 97 FCR 524, firstly, at page 536 within paragraph 30, about the middle of the paragraph, there is a sentence which starts:

If a patent application, lodged in Australia, refers to information derived from a number of prior publications referred to in the specification or, generally, to matters which are known, in our view the Court – or the Commissioner – would ordinarily proceed upon the basis that the knowledge thus described is, in the language . . . part of “the common general knowledge as it existed in the patent area”.  In other words, what is disclosed in such terms may be taken as an admission to that effect.

One then goes to paragraph 45 on page 541.  Their Honours said:

Indeed, there is in our view an element of unreality, in a case such as the present, even in posing the question in that form.  Although Philips suggests that there may be such cases (it does not decide the question –

this is where there is some inventive quality –

it is not easy to envisage circumstances in which a claimed invention may lack the threshold requirement of inventiveness, but yet involve (for the purposes of s 18(1)(b)(ii)) an inventive step.  This is not a case, like Philips, where there was no attack on the patents on the ground of obviousness.  It was, instead, a case where expert evidence, including evidence as to common general knowledge, was available (and was given).  Where the Court has evidence on the basis of which it can make a finding about common general knowledge, and the other information . . . about what would or would not have been obvious to persons skilled in the relevant art, it must be only rarely that it will be appropriate to find (by resort to a “threshold test”) lack of inventiveness on the face of a specification ‑ ‑ ‑

FRENCH CJ:   Maybe Americans would call it “facial obviousness”.

MR BANNON:   Yes.  Then at page 543 in paragraph 53, there is a similar sentiment.  There is no suggestion here there was any admission about common general knowledge here.  Then on an analogous point, again if I go back to Lockwood (No 2) 235 CLR 173, the discussion starting at page 210, “Admissions in a specification”, the passages which go from 105 through to 111 are all important and a couple of them my learned friend Mr Catterns took your Honours to. Their Honours say in – we emphasise the part under paragraph 106, the “on its face” point, it would be a rare case, and also at 108 on page 212, even if you do get some admission in a case where you have got evidence, that is what one would rely upon. Then 111 is an important paragraph which we emphasise, and it says in the middle of that paragraph:

A court cannot substitute its own deduction or proposition for that objective touchstone, except in the rarest of circumstances, such as where an expressly admitted matter of common general knowledge is the precise matter in respect of which a monopoly is claimed.

That is a similar sentiment to what we see in Bristol‑Myers, namely, this is an issue where obviousness is obviously in contest as evidence.  Our learned friends invite this Court – and invited the other courts – to come to a view, if it is the same as obviousness you do not need to deal with it, but this Court to come to a view that on the face of the specification it is obvious, in circumstances it was not obvious on all the evidence. 

It is not an exercise the court will ever engage in unless, in effect, there is an out and out admission.  In any event, if one looks – I will not go back to the specification, but we say a couple of things about it.  The invention asserted on the face of the specification is the treatment, so it includes the treatment using rosuvastatin.  There is no admission that rosuvastatin was part of the common general knowledge.  It refers to the 5 to 10 milligram dose.  The mere fact that it refers to that dose is not an admission that that was a step which involved no difficulty.  It says repeatedly it is a surprising outcome, and although it refers to a dosage of atorvastatin, that advances the exercise for the respondents not a jot.

There is nothing on the face of the specification to say that the mere fact atorvastatin was being used at 10 milligrams meant upon reading the face of the specification that it was obvious to use 5 to 10.  There is just nothing there so support it at all, and we otherwise rely upon the reasons of the Full Court in that regard.  There is an additional point which the Full Court did not think made any difference, namely, whether or not, raised by my learned friend Mr Ryan, whether or not the prior specification is incorporated by reference.  We say that the Full Court’s reasoning on that that it is not incorporated by reference is clear.

My friend says – perhaps inconsistently with some other submissions ‑ because rosuvastatin is part of the invention it must be intended that they were directing you how to make it.  We say that is some sort of inferential inclusion and is not warranted.  Can I just give your Honour’s a reference ‑ Justice Gummow’s decision, sitting at first instance I think it was, certainly in the Federal Court, Nicaro Holdings v Martin 91 ALR 513, at 532. The bottom of the page referred to how one considers whether it is incorporated. But, in any event, the Full Court said in this case, even if it is incorporated, it makes no difference, and we say that their submissions on that are not open to criticism. Then, I think I am down to novelty. I can make these submissions by reference to the Full Court’s reasons. So the Full Court at 2511 – this is part of their consideration of the novelty issue. Their Honours say in 289:

There can be no question that each of the above dosage regimens falls within the broad description –

In 290, they make that statement to which your Honours have been taken to a couple of times, but it is an important statement:

In context, this means that the dose may vary depending on whether or not –

et cetera, and the balance of that paragraph is obviously important, over the top of the next page.  At 292 on 2512, contrary to my learned friend Mr Ryan’s submissions, this is a paragraph precisely addressing the issue of disclosure.  That seemed to be the only criticism levelled, or the criticism levelled at the Full Court’s reasoning.  That is disclosure.  We say there is nothing incorrect about that finding.  Paragraph 294, they refer to the ICI Chemicals decision, planting the flag in the locker, and also Justice Gyles, at first instance, in Sanofi, that again, they are disclosure cases.  Then 295, again, is a clear finding in relation to disclosure. 

So, we say, there is no error and the reasoning, we submit, is not subject to criticism.  Lastly, can I deal with “staple commercial products”, and say firstly, the exercise in relation to “staple commercial products” is assessing the words of the statute.  Collins was not decided in a way to do other than deal with the particular circumstance, and none of the judges’ statements as to the meaning of “staple commercial product” were intended to define for all time what “staple commercial product” meant, although obviously they informed the decision. 

One way of looking at the staple commercial product is it may be hard to describe but it is easy to recognise, it may be like an elephant.  But, whatever the spectrum is, we say, this is plainly not a staple commercial product.  If one does go to Collins, a point of emphasis which we make in the reasons of Justice Crennan, at page 653, in 135, her Honour says:

The phrase “staple commercial product” means a product supplied commercially for various uses.

That has a couple of elements.  The first is one looks at the product from the point of view as it appears as it leaves Apotex.  So they supply a product in a particular form, which can only be supplied on prescription, and is supplied for particular designated purposes, for uses in particular designated purposes in what is called a product information document.  The word “indications” is used.  It is indicated for – I think it is hypercholesterolemia and cardiovascular disease. 

You could stop there and say that is not a staple commercial product, and it is supplied, it says “for various uses”.  That is, for particular uses against supply by Apotex.  It is supplied for particular uses, namely, prescribed uses.  So, therefore, one does not look at the uses – as I say, the concept of it, if one just turns to the Act – that is 117 ‑ in broad terms in subsection (2)(a), firstly:

if the product is capable of only one reasonable use, having regard to its nature or design –

So, in other words, if it only had one use, then that would not apply, but (b):

if the product is not a staple commercial product – any use of the product –

So you can be a staple commercial product but it can have more than one use, because otherwise there would be no need for (b), you would be in (a).  So, almost – the statute itself recognises that a staple commercial product can have more than one use, but if one understands it as the point of view of the product as supplied for purposes, then one recognises that the legislation is effectively saying if you supply something for particular purposes – limited for particular purposes – then you are the sort of supplier who is likely to have reason to believe legitimately when it is being used for any particular use. 

On the other hand, if you are a supplier of a staple commercial product hardware item or timber which has been supplied for no particular use, there is no reasonable basis on which you could be expected to know or be across all the benefits – all the particular uses.  So, you may be a hardware supplier who supplies screws, the mere fact you read about a screw being used in a invention is not something that you can be attributed to.  That is the point of limitation. 

If one looks at the reasoning of the primary judge – sorry, which is set out – it is sufficiently set out in the Full Court’s reasons, so it is volume 7 at 2548.  At the foot of that page within paragraph 428 about line 40 on the document, her Honour says:

Despite the fact that I accept that rosuvastatin has a number of medical uses, not just the treatment of hypercholesterolemia, I cannot accept that it should be characterised as a “staple commercial product” . . . the reasoning in Collins does not lead me to the view that the fact that a product can be used in one or even a number of non‑infringing ways is itself sufficient to make the product a staple commercial product.  While “staple” is not concerned with the economic significance of uses, it is concerned with the variety of uses.  The variety of uses in this case is confined by the nature of the product to a limited class, being the treatment of diseases of a particular kind . . . Rosuvastatin, despite its usefulness for a variety of disease conditions, is not able to be compared to timber –

Then, if one drops down to paragraph 431 at the foot of the page, 2549, their Honours say:

We are not satisfied that rosuvastatin is a staple commercial product.  The fact that it may be used for both infringing and non-infringing purposes is not conclusive.  There are many products capable of being used for both infringing and non-infringing [uses] that cannot be characterised as either raw materials or basic products . . . The uses to which rosuvastatin may be put appear to us to be limited to the prevention or treatment of cardiovascular disease and its associated risk factors –

That is basically one or two uses, but they are known uses and it leaves Apotex in a specific form – in this case, they are talking about the 20 milligram pack – for two specific uses.  That falls squarely, we respectfully submit, in a non‑staple commercial product.

Of course, the product character as a staple commercial product or otherwise is not defined by the perchance claims which any person may file, including my client.  Of course, one can have broader or narrower claims.  It cannot be a staple commercial product, for example, because it may infringe claim 1, but may not infringe claim 3.  It does not change its character depending on some act that somebody else has done, being us, or my client, in filing a patent and getting claims.

Its character is not dependent on a comparison between the use of the product and claims by a third party and whether or not they infringe – although there is a reference to that language in Collins – rather, it is referring to the nature of the product itself as it is sold when it is the commercial supply of it, is it for, in fact, indiscriminate and wide uses, in a “staple” sense, or is it for particular uses.  It falls in that second category.

The very last issue is a reference by my learned friend, Mr Ryan, to inviting this Court to reconsider the evidence as to whether they were reasonably aware of the use in relation to 20 milligram tablets.  We respectfully submit that that is not a proposition which ought to be attractive to your Honours.  The courts considered and considered the evidence in detail.  There is no error shown.

We should just point out, at page 2553, in paragraph 444, their Honours make it clear that merely finding reason to believe and the application of 117(2)(b) does not mean that, for example, my client when it came to relief would get a blanket injunction.  I should add, if we were successful in this appeal and upholding the patent, the question of relief would need to be referred back to the trial judge, I expect.  Things like working out the scope of any injunction and if there was to be one in relation to 172 – perhaps when I say relief, it would be, perhaps, injunctive relief.  May it please the Court.

FRENCH CJ:   Thank you, Mr Bannon.  Mr Solicitor, I will make clear at the outset that you have leave to intervene, if you wish.

MR GLEESON:   Thank you, your Honours.  Your Honours, in that event, there are two substantive submissions the Commonwealth wishes to make.  The first, which is paragraphs 7 and 8, is the short cautionary submission, which is that the Court would not, we submit, reach ground 2 in general, or the correctness of Sanofi in particular, unless necessary, and the correct forum, if possible, for reviewing the correctness of Sanofi is the second special leave application, five years after the first rejected application, which the Court has deferred to later this year.

Your Honours, could I then focus on the second substantive submission which is, if it becomes necessary for the Court to reach Sanofi, could I indicate why it is that certainly on the facts of Sanofi and the 1952 Act, that decision remains correct, and perhaps in doing so just indicate the flow over consequence that would have for the 1990 Act and take up your Honour Justice Nettle’s question about how the invention is to be characterised in this case, and seek to answer Mr Bannon’s question of where is the textual route for a starting point approach.  Before I identify that textual route, could I take a simplified example which reflects the facts of Sanofi and avoids reference to compounds that I am not capable of pronouncing?

Assume I am the inventor of paracetamol in Australia.  Assume I publish a specification which discloses paracetamol as a suitable compound for headaches and I claim a patent for it.  Assume, as per the Sanofi facts, my patent has not yet become common general knowledge.  That will be my main invention.  Then assume I want to improve on my invention in several possible ways.  I could give three examples.  The first is, turning paracetamol into tablet form which is necessary for ingestion.  Let it be assumed that turning it into a tablet form is obvious.  That is the first modification.

The second modification which might be slightly closer to inventiveness is, perhaps, narrowing down the dosage range from 1 to 100 to 5 to 10.  That may or may not be inventive if I am starting with paracetamol.  The third example is, let us say, I discover that paracetamol is, in fact, useful for hypercholesterolemia – some other condition altogether – beyond anything disclosed in the first specification.

What the starting point analysis does is to allow one to say that there will be certain cases – not every case – there will be certain cases where when a person frames the second invention, it is part of that invention – firstly, as described – which then informs the claim that it has started from something – in my example, paracetamol – and what it is claiming as an invention is the passage from paracetamol to the tablet, the revised dosage form or, perhaps, the new use.  If a person chooses to describe and then claim an invention in a manner which starts from A and goes to B, that will be the invention against which every element of validity is tested; not just obviousness, but every element of validity.

There can be very good reasons why a person claims their invention in a way that starts at A and goes to B and does not start earlier in time with the discovery of A.  Those reasons are illustrated by your Honour Justice Nettle’s questions.  If I am the second person in my example, and I have not invented paracetamol, for me to define and claim an invention in a manner which includes paracetamol will be bad for lack of novelty.  Even if I were to claim it in the broader sense, I will lose my invention and I will be cut back to the only part that could possibly be an invention, namely, the passage from paracetamol to paracetamol plus 1, 2 or 3.

That is the underlying concept of “starting point”, that there can be cases where, if you allow the second inventor to describe and claim as the invention the entire journey, they will be claiming the credit for the novelty in the invention which lies somewhere else.  Sanofi is a particularly acute example of that, because in Sanofi, it is the same person.  Sanofi published and invented and got a patent for what I am describing as paracetamol.  Sanofi’s second invention, the one in suit, was for turning the paracetamol product into a form, with a salt, that could be ingested.  The evidence was that turning it into a salt was obvious.

What Sanofi did by claiming a second independent patent, if it worked, was to take a wholly new patent term, starting from the later priority date, thus going through for a longer period, where the only step it had taken from its first patent was an obvious step.  That creates an evergreening problem where the same inventor can extend the term of their original patent by making obvious variations to it. 

It creates the problem that a person in Sanofi’s position – if they want an extended term, because they have done a bit more work, they do one of two things.  They either seek a patent of addition, which has the same term as their original patent, or they ask for a patent extension and they justify that they have not had adequate remuneration.  That is what starting point allows the court to address.  Could I then show your Honours where it has a textual reading in the 1952 Act.  In section 100(1), we have a number of grounds of revocation, and in ground (e), the ground is:

that the invention, so far as claimed in any claim . . . was obvious and did not involve an inventive step having regard to what was known or used in Australia –

The step that Mr Bannon passes over is that “invention” is a defined term in section 6, meaning, as you have heard from the manner of manufacture argument:

any manner of new manufacture the subject of letters patent and grant of privilege within section 6 of the Statute of Monopolies, and includes an alleged invention –

So the threshold requirement, which you have received submissions on in terms of Philips v Mirabella, which is considered on the face of the whole of the specification is really this.  What is it that the claimant puts forward as the manner of new manufacture within section 6 which, in short, is worthy of a monopoly.  At the stage of the manner of manufacture argument which logically might be considered the first argument in a case, although you have heard it further down the batting order, one has to engage in a characterisation exercise.  What is it that Sanofi or AstraZeneca put forward as the manner of new manufacture within section 6?  Then it is that invention which, returning to 100(1)(e), will then find its reflection in the claims and can then be measured against the prior art base to determine whether it is obvious.

In the present case, as you have heard from the manner of manufacture argument in the present patent, the new manner of manufacture on the face of the specification is taking a known agent, rosuvastatin, and doing something to it, namely, narrowing it down in two senses:  firstly, choosing one of the three conditions for which it is recommended and, secondly, choosing a more particular dosage range within the larger range.  That is what the body of the specification says is the manner of new manufacture.  It is to take something which is known, rosuvastatin, to use it for its known purposes but to improve upon it by that narrowing exercise.

The issue before the Court on the manner of new manufacture is whether, on the face of the specification, that is something that justifies letters patent and a grant of privilege within section 6.  It is that invention which then finds its way into the claims.  Your Honour Justice Nettle asked how does one characterise the claim, and the critical element that Mr Bannon has left out is that yes, it is a claim to a method of use of rosuvastatin for a purpose within a range, yes.  But understood in the light of the invention, one needs to add to that characterisation that it is a method of use of a known product for its known purpose within what is said to be a narrower and improved range.

As I have done that, I have not simply linguistically parsed the words in the claim.  I have done some exercise in characterisation, that it is a claim for the use of a known product for its known purpose in what is said to be a narrower and improved range.  That exercise of characterisation is to reflect the invention that has been put forward, and that characterisation then, through the claims, provides the basis for every issue under revocation.

Each patent will be different but there are classes of patent.  So, 3M, Alphapharm, are combination patents and the Court has made clear that there are some patents where the nature of the invention lies in the selection of diverse integers, some new, some old, where it is the interrelationship between those integers which constitutes invention. 

If the patent is characterised in that manner that provides the prism through which one then examines the various grounds, including obviousness.  For obviousness, one would ask, was it obvious, routine, to select those integers and achieve that combination.  In the present case, doing the characterisation exercise, which is more than purely linguistic, the obviousness question becomes, under section 100(1)(e), was it obvious, having regard to what was known or used in Australia to come up with the invention being the use of the known product for a known purpose within what is said to be a narrower and improved range.

That then allows one to focus the question of inventiveness upon the step in choosing the range of 5 to 10 as against that which was known, namely, 1 to 100.  That does not put Sanofi or AstraZeneca in a worse position than a third party who is not aware of the earlier publication or user because if I am a third party with no knowledge of rosuvastatin but I am working on the larger problem of finding a better statin and I go from zero to 100 and I end up with rosuvastatin 5 to 10 range, and I claim that my invention is rosuvastatin, plus, in a dependent claim I say it is rosuvastatin used in the 5 to 10 range, my first claim will be invalid for anticipation.

So, objectively, the only bit that I will actually be able to claim once I survive novelty will be the very same bit that AstraZeneca is tested on.  So, your Honours, that is the textual route.  Could I indicate under Part VII of the 1952 Act that what a person in Sanofi’s position could have done if they were to improve their main invention was under section 72 they could apply:

for a further patent in respect of an improvement in, or modification of, the invention –

but the price for that would have been, in section 72 at the end, that they would have achieved the same term as the original patent term.  The vice in what Sanofi was doing, which the Full Court has correctly not allowed, is that Sanofi has, in effect, obtained a second and longer term for what at best was an improvement or modification for which it should have been confined to its original term. 

The other critical feature of Part VII is that in section 76, which came into the 1952 Act following the Deane Committee Report which we provided the Court a copy of, the very issue that might otherwise have arisen was anticipated by the drafting which is, well, Sanofi’s journey from the first invention to the second invention may well of itself have been obvious once you had the first invention and section 76 allows a Sanofi‑type person to overcome that because the publication of the main invention or the use of the main invention is not to be used against it in the obviousness exercise.

So, if Sanofi was inventive in getting to the main invention, but obvious in improving it, it can still obtain its patent of addition where it gets the credit for the original inventiveness but its term is limited to the main term.  So, the result in Sanofi, we would be submitting, under the 1952 Act on that sort of case, where it is the same inventor attempting to evergreen, having only done an obvious modification, is correct and the points I have just sought to make to the Court about the use of section 76 were the points which appealed to trial judge Justice Giles in Sanofi, we would submit, correctly. That is reported 78 IPR 485, particularly at paragraphs 104 to 105, and the Full Court of course agreed with Justice Giles.

But what Justice Giles identified in paragraph 104 is the very vice in what Sanofi was seeking to do and he explained how, in 105, the answer to Sanofi’s endeavour to get a patent for its improvement was to put itself within Part VII, which are the improvement provisions, and the only alternative for Sanofi, if it said, “I have not been adequately remunerated because it has taken me some time to get to the salt”, would be to seek a patent of extension under Part IX if the 1952 Act.

Finally, your Honours then, under the 1990 Act, if it is necessary for the Court to trace how this concept has moved from one Act to the other, the textual root again is found in the concept of invention, this time in section 18, where an invention is a patentable invention if the invention so far as claimed in a claim meets (a), (b), (c) and (d). 

“Invention” is the defined term, this time in the dictionary at Schedule 1, end of the Act.  It is the same definition.  So at the threshold stage one asks what is it that this person has put forward as being a manner of new manufacture within section 6.  If this person has chosen to identify its manner of manufacture as moving from A to B that is the invention.  The claims are understood in the light of that identification of the invention, and the invention is then judged against the patentee’s own description. 

Your Honours, perhaps finally in Sanofi 82 IPR 416 in the Full Court, could I go to two paragraphs – first, paragraph [152], that Mr Bannon criticised and then paragraph [160]. Your Honour the Chief Justice asked a question about how paragraph [152] should be read. The court there starts with section 100(1)(e) and says it is:

whether the invention –

that is italicised –

so far as claimed in the particular claim, is obvious and does not involve an inventive step.  That requires a determination of the invention, as described in the specification.

We would interpolate that the court is referring to the section 6 definition of “invention” which underpins the Act and it is that invention which section 40 then says must be on the one hand described, and on the other hand defined, by the claims.  When the court then says –

What is claimed may then equate with, or be less than the totality of . . . the invention –

That is the section 6 manner of manufacture invention, and the claims may claim the invention in different forms, and therefore, they may be less than it.  But the invention the court is speaking of is not Mr Bannon’s freestanding inventive step.  It is the patentee’s own identification of the manner of new manufacture.  The court then goes on to say in this particular case, because –

the patent makes it clear that the selection of PCR 4099 as the racemate –

that is the paracetamol in my example –

to be resolved formed no part of this invention as described and claimed –

So they are looking at the whole of the document.  For that reason, this patent has set up the invention at a later stage, namely the separation of the enantiomers, and then the formation of the salt.  That is what becomes the subject matter of the claims, and that is what is assessed for obviousness.

The second passage is paragraph [160].  This is an important paragraph because in the first special leave application, Justice Gummow put a question to Mr Bannon as to what is the error in paragraph [160] and he gave an answer which was effectively the answers he gave today.  It is a critical paragraph in the Court’s reasons.  What the Court here is saying is:

The problem addressed in the patent is the resolution of the enantiomers of PCR 4099.  The problem is described.

So this is the court again identifying what it is that is the invention within section 6.  So then they refer to the “hypothetical skilled worker” having a particular starting point and the last two lines of [160] are very important.  This illustrates the starting point is not some rule of law that applies in every case.  The court says:

It should be emphasised that the base line or starting point may itself be part of the inventive step or inventive process but that is not the case here.  The selection of PCR 4099 for resolution was not claimed to be inventive.

Your Honour Justice Nettle asked Mr Bannon squarely is the selection of rosuvastatin part of the invention as claimed and his answer was a little elusive in answer to that.  But, what the court is recognising is there can be cases where you say “I invented or selected paracetamol and that is part of my invention and I will stand or fall on that in terms of every one of the heads of invalidity”.  But there can equally be cases where I say “I candidly accept paracetamol is known.  What I claim to have done is improve

paracetamol in a particular fashion”.  Then the whole focus of validity is on the journey from A to B, not on the selection of A as the starting point.

So your Honours, for those reasons, if it proved necessary to reach ground 2, and further, particularly, to reach Sanofi, we would submit that within the limited confines of what has been available to the Court today on this issue, no error is demonstrated.  Unless your Honours have any questions, they are our submissions.

FRENCH CJ:   Yes, thank you, Mr Solicitor.  Yes, Mr Bannon.

MR BANNON:   May I be so bold as to seek leave to take two minutes.  The submission made by Mr Solicitor is not something which has been advanced before as to the textual analysis.  It was not in the outline.  It was not in the oral outline.  It is not a criticism, but we have never addressed it.

FRENCH CJ:   Yes.

MR BANNON:   Thank you, your Honour.  Firstly, no one in Sanofi suggested that textual basis was the basis.  Secondly, it conflicts with the passage I have taken your Honours to in Kimberly‑ Clark and Lockwood (No 2) which say section 42 and the words “so far as claimed in any claim” are referring to the asserted invention.  Three, the definition of “invention” in both the 1952 Act and, I think, in the 1990 Act include “an alleged invention”.  Four, section 100 included as a ground of invalidity, not a manner of manufacture.  That appears from section 100(1)(d):

the invention, so far as claimed in any claim . . . is not an invention within the meaning of this Act.

That was the language which captured “not a manner of manufacture”.  Its equivalent appears in section 18(1)(a) under the current Act, so that the linguistic twist Mr Solicitor’s submission invites is that you test – you somehow or other test – the invention so far as any claim, is it a manner of manufacture, but you test it again in 100(1)(d).  With respect, it does not work.

An additional reason it does not work is this, that the manner of manufacture ‑ and your Honours will hear about this when the…..goes up or ‑ the thalidomide case raised a similar issue ‑ what constitutes a manner of manufacture has really two aspects.  One is is it the sort of thing the old Act recognised as should be accepted as an invention but, secondly, there is this lack of invention element but only in the context of the Microcell system.

So, in other words, you have got to have a claim, the invention, and then you ask on the face of the specification, that is the limited scope of a manner of manufacture claim.  So, you have got to have your claim to start with, and as we have already had the debate, we have the debate, is there a manner of manufacture on the face of the whole specification?  It is a circular proposition as a Gordian knot which never gets broken in my learned Mr Solicitor’s analysis which may be a reason why it has not been proposed before.  If it please the Court.

FRENCH CJ:   Thank you, Mr Bannon.  The Court will reserve its decision – I am sorry, yes?

MR CATTERNS:   I do apologise, I just wondered if we could have leave to reply on the two matters of contention, namely, starting point and entitlement.  I would be no more than 10 minutes, probably less?

FRENCH CJ:   I think you have put your contentions. 

MR CATTERNS:   We did, your Honour, but there is a couple of the ways our friends put it that were slightly different, but I am in the Court’s hand, of course.

FRENCH CJ:   We will just confine you to anything that arises out of what the Solicitor has said. 

MR CATTERNS:   Your Honour, all I would wish to add to the Solicitor to assist the Court is the current references in the present Act to patents of addition are sections 81 to 85 and the protection against obviousness is section 25.  What I had in mind was something our learned friend said this morning in relation to manner of manufacture but ‑ ‑ ‑

FRENCH CJ:   I think we are done, Mr Catterns. 

MR CATTERNS:   May it please the Court.

FRENCH CJ:   The Court will reserve its decision.  The Court adjourns until 9.30 tomorrow morning in Sydney and 9.30 tomorrow morning in Melbourne.

AT 3.27 PM THE MATTER WAS ADJOURNED