Boehringer Ingelheim International GmbH v The Commissioner of Patents

[2003] HCATrans 569

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M66 of 2001

B e t w e e n -

BOEHRINGER INGELHEIM INTERNATIONAL GMBH

Applicant

and

THE COMMISSIONER OF PATENTS

Respondent

Application for special leave to appeal

McHUGH J
HAYNE J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 14 FEBRUARY 2003, AT 9.45 AM

Copyright in the High Court of Australia

MRS A.C. BENNETT, SC:   If it please the Court, I appear for the applicant, together with my learned friends, MR B.J. HESS and MS L.J. DUNCAN, (instructed by Callinan Lawrie Solicitors)

MR G.C. McGOWAN:   If the Court pleases, I appear with, MR B.J. FITZPATRICK, for the respondent.  (instructed by the Australian Government Solicitor)

McHUGH J:   Yes, Mrs Bennett.

MRS BENNETT:   Thank you, your Honours.  If your Honours will forgive me, I will stand here rather than go to the lectern.  Your Honours, few, if any, pharmacologically active compound ‑ ‑ ‑

McHUGH J:   It may be a question as to whether you are being properly transcribed?

MRS BENNETT:   I have moved the microphone to here, if that is satisfactory?

McHUGH J:   Yes, thank you.  Your Honours, few, if any, pharmacologically active compounds act, or have a therapeutic action in their pure form.  They have to be dealt with in order to have that therapeutic action.  They have to be put into a suitable form.  This might involve dissolving them, it might involve turning them into a vapour, and they have to then be delivered to the site of action for them to have a therapeutic action.

This may involve, for example, putting them into a tablet, it may involve putting a physical barrier around the outside of the table to protect the active ingredient, for example, to go through the stomach, where it can be delivered to the small intestine.  It may involve putting them into a container that delivers a metered dose of vapour into the nose to enable the active ingredient or composition containing the active ingredient to be delivered to the mucosal lining within the nose.  It may, indeed, involve a transdermal patch.

The complexity of this concept of how one gets pharmacological or pharmaceutical action in a therapeutic sense is dealt with in the definition of “pharmaceutical substance” that appears in Schedule 1 of the Patents Act 1900, and I do not know if your Honours have the Act.  It is behind tab 2 in the bundle that we sent up to your Honours.  If your Honours have that you will see that there is quite a complex definition of “pharmaceutical substance”.  It means a substance, which can be defined ‑ as we have sent up in the dictionary definitions ‑ to be matter or material.  So it can be matter or material:

(including a mixture or compound of substances) for materials for therapeutic use whose application (or one of whose applications) involves:

(a)  a chemical interaction, or physico‑chemical interaction, with a human physiological system; or

(b)  action on an infectious agent –

This means that there is recognition that it cannot – that a pharmaceutical substance is not limited to the active ingredient itself.  It also means that one can have a mixture of matter or a mixture of matter and materials.  The definition of pharmaceutical substance and the ramifications of it were not considered at all by the Full Court.  There was no consideration of it in looking at section 70.

If I can take your Honours to section 70 of the Act, in a part of the Act that was introduced by way of specific amendment – and I will be coming to the purposes for that amendment in a moment – this was to provide for extension of terms, of standard patterns relating to pharmaceutical substances.  As is apparent, this part was introduced for a number of reasons.

It was introduced according to the second reading speech and the explanatory memorandum in order to benefit Australian pharmaceutical companies to assist overseas companies or to make it more attractive for them to invest in research and development in Australia, to recognise the fact that this area of pharmacological substances usually have very delayed marketing approval which means that there is a very short effective patent life, and specifically to bring Australia in line with named other countries, namely the United States, Japan and Europe which all provided for extensions of term in the area of pharmaceutical substances, and extensions of patents that dealt with those substances.

If your Honours go to section 70(2)(a), which is the relevant section, your Honours will see that it is in very broad terms.  It says:

one or more pharmaceutical substances per se must in substance be disclosed in the complete specification of the patent and in substance fall within the scope of the claim or claims of that specification.

The Full Court considered neither the definition of “pharmaceutical substance” nor the words “in substance” fall within the scope of the claims.  Indeed, in their paraphrase or repeat of the section which was paraphrased by Justice Heerey, the words “in substance” were in fact left out completely.  So the Full Court then, without looking at “pharmaceutical substance” and the fact that it can be a mixture, looked at the words “per se”, limited it to in effect the active ingredient and then it agreed with the fact that the expression “fall within the scope of the claims” would normally in a normal construction mean, “include amongst the things claims”, accepted that and then said, but in the patent sense, they in effect rewrote the second part of the section to say that the claim has to be only to the pharmaceutical substance or in effect be active.

HAYNE J:   Well, (2)(a) is cumulative, is not it?  It has two requirements?

MRS BENNETT:   Yes, your Honour.

HAYNE J:   Focusing for the moment on the first of them, what do you say that the definition of “pharmaceutical substance” contributes to the argument that you are now making?

MRS BENNETT:   What the definition does is to make it clear that in using the expression “pharmaceutical substance”, it is referring to a mixture of substances or a substance and material that has the therapeutic effect.  In the present case, the mixture is the subject of two sets of claims or two independent claims and dependent claims on them, both of which ‑ ‑ ‑

HAYNE J:   The relevant mixture being what, the active ingredient and its container?

MRS BENNETT:   Yes.  In substance, it is clear that the claim is directed to the active ingredient.  In order for it to have a therapeutic use, it must be in an aerosol form and is delivered in a container with a metered dose.  Now, in our respectful submission, it is clear that the pharmaceutical substance can include – sorry, that the pharmaceutical substance itself can include the active and the other matters referred to in the claim and, importantly, even if it were only the pharmaceutical substance or the “active” alone, that is, in substance, disclosed in the complete, and that is not in dispute and, in substance, it falls within the scope of the claims, because the claim is really directed to the active ingredient.

The patent itself is entitled “pharmaceutical compositions”.  The claims are, in their terms, claims to compositions, and we should say in that regard – I can take your Honours to the two sets of claims.  If your Honour goes to page 18 your Honours will see that the claims defining the invention are as follows:

A container comprising an aerosol or spray composition for nasal administration which composition comprises as active ingredient . . . the container being provided with a nozzle adapted for nasal administration.

Then if your Honours go to claim 14 at paragraph 20, which claim was not even considered by the Full Court:

An aerosol or spray composition as claimed in claim 1 when used in the container.

The Full Court, in our respectful submission, did not go to claim 14 in part, because they could not apply their reasoning to it.  So we have a situation where claim 14 is clearly, in substance, claiming and disclosing ‑ well, the disclosing is not in dispute in the body of the specification:

An aerosol or spray composition as claimed in claim 1.

HAYNE J:   What work are you giving to the words, “per se”?

MRS BENNETT:   Your Honours, when one goes to the explanatory memorandum to see what was intended, the words, “per se”, are directed to the fact that what they are looking to do is to deal with products.  It is, in substance, a product claim.  So “the pharmaceutical substance, per se, in substance, disclosed and claimed”:  the claims and the body should be basically dealing with a product.  That is actually explained, if there is any question about it, by the fact that in clause 9 of the explanatory memorandum, the only things that they say they are trying to exclude are product by process claims or mere new use of known products in new methods of treatment.

There is no dispute in the present case that the product here was a new substance.  It is not a known substance.  Whereas the explanatory memorandum says they are trying to exclude from the scope of the extension a mere new use of known substances.

McHUGH J:   Yes, but it is said against you that ‑ this application stems entirely from the fact that you failed to apply for an extension of Patent P548186 in time, and now you are seeking to use this as a vehicle to protect that.

MRS BENNETT:   With respect, your Honour, that is an irrelevancy for this reason.  The other patent was a divisional of this patent.  It was merely a divisional, so in other words, it took the same priority and was based upon this patent.  Claims 14 and onwards are substantially the same as the claims in the other patent.  So there is no point that can be made of that because we are entitled to claim the extension of the parent which is what this is and the claims in that divisional were substantially the same as claims 14 and its dependent claims here, and that does not, in our respectful submission, detract from the fact that the section applies to these claims.

McHUGH J:   It is a very unpromising vehicle for a special leave application.  We have said again and again that ordinarily questions arising under this Act should be dealt with by the Full Court of the Federal Court finally and you have lost in front of the examiner, in front of a trial judge and in front of a Full Court of the Federal Court.

MRS BENNETT:   Your Honours, can I answer that in two ways?  Perhaps the specific way, first;  the patent examiner – the delegate of Commissioner who first heard it – simply applied the patent office manual.  His Honour Justice Heerey simply applied that manual.  He just referred to it and said, “I will apply that.”  The Full Court did not consider it, but more importantly, this is a new part of the Act.  It has never been dealt with before.  The Federal Court, in our respectful submission, is clearly wrong and that is going to be applied across the breadth of these areas in order to deprive patentees of the extensions of term to which they are entitled.

Now, it goes further than that, because when one looks at section 78 of the Act, that says that even if you get an extension you cannot sue for infringement if somebody uses another form of the invention.  That means that you cannot in fact if the Federal Court is right and it will be applied and has been applied that way, if it is limited to the active, that means that any patentee who has a therapeutically useful composition cannot sue for infringement, because it will not be in the form of the active alone.  It would be in a solution.  It will be with an enteric coat around it.  It will be in an inhaler.

So we have a situation where if the interpretation that has been put on this, without due consideration by the Federal Court, if that happens then the entire part will fall and, in our respectful submission, bearing in mind that Parliament has specifically introduced this whole part by amendment, for broad ranging effect and purpose for the benefit of the Australian economy and for patentees and for Australian research and development, and to bring us in line with out international partners, none of whom make this distinction, none of whom distinguish between a chemical or a physical delivery of a device or indeed distinguish in the way our learned friends are seeking to it all.  Then the entire effect of this part goes and Parliament has not achieved what it has intended to achieve, and it is not because it has had full consideration.

In the present case, the Federal Court did not give this section – it did not even consider – it has not in fact construed the section.  It has not looked at “pharmaceutical substance”.  It has ignored the words, “in substance”.  It agrees that “fall within the scope” would normally cover it, and then says, in the patent sense somehow, that does not apply.

McHUGH J:   Your argument ignores the words “per se”?

MRS BENNETT:   They do not, with respect, your Honour, because the words “per se” mean that the subject matter of what is disclosed in claims must in substance be a product.

McHUGH J:   No, it does not.  It means by itself.

HAYNE J:   Had an application been made in time for extension of the divisional patent earlier referred to, on the construction of the Full Court, would that application have been open to succeed?

MRS BENNETT:   No, because what it is linked with is section 70(3) that requires you to get marketing approval, and the delegate made it clear that on her reading, in the narrow way in which it has been framed, the very fact that the claims went beyond the active substance alone, because that is not what you got marketing approval for ‑ the marketing approval was for the inhaler that delivers the dose.  You have to have the dose referred to, and so would have failed for subsection (3).

The very construction of the Federal Court ignores the fact that subsection (3) is linked in and the marketing approval can only be for the therapeutically active form.  So you get an extension for the compound all by itself which ignores the definition of “pharmaceutical substance”.  That is not what you get marketing approval for and you cannot infringe ‑ ‑ ‑

HAYNE J:   Do you get marketing approval for goods containing the substance, (3)(a)?

MRS BENNETT:   Yes, you do.

HAYNE J:   Does your client have marketing approval for goods containing the subject of the divisional patent?

MRS BENNETT:   Yes, your Honour, but the patent ‑ ‑ ‑

HAYNE J:   (3)(a) was therefore met?

MRS BENNETT:   No, because the Patent Office said that because the claim, even in that other patent, not only had one active but two actives, said that that would preclude it getting an extension because it was not a single active alone.  So while you can get marketing approval for something that contains one active but also has other things in it, the delegate said you could not get extension for it because, on the reading of the delegate, which is now being followed through, the claim has to be only to the active ingredient which itself makes it unworkable and which ignores the definition of “pharmaceutical substance”.  Nobody has brought into this definition the definition of “pharmaceutical substance” which itself qualifies the “per se”.  The “per se” does not say the active ingredient and it does not say that the claim has to be two or define the active ingredient.  It says you can have a mixture, and that is what is per se because we know that all they are trying to exclude is products by process or mere new use of known compounds, and then even that only has to, in substance, be within the scope of the claim and that was ignored because it is quite clear, in our respectful submission, that when you look at the words “in substance” within the scope of the claim, it is satisfied if the claim is in substance to the pharmaceutical composition, which this is here.

The very fact that no one considered or the Full Court did not consider claim 14 at all shows that they did not want to or they did not go further and assess properly what does and does not constitute a pharmaceutical composition that is, in substance, disclosed and claimed.  If this decision stands, your Honours, the whole scheme is unworkable.

I appreciate what your Honour Justice McHugh put, in terms of the fact that it is the Full Courts that deal with patent matters.  That has been in the context, however, of matters that go fundamentally to more patent type issues.  This is saying that you construe this statute differently to the way you would construe it.  It is a construction point as to whether the whole Patents Act somehow has some construction all by itself because the Full Court conceded that in the ordinary construction terms, those words would include this composition, but they said, for no reason we construe it in some sort of inverted commas “patent sense” to give it a meaning other than that and, with respect, this Court has taken, in certain circumstances, of course, other patent cases, and this, if anything falls within the scope of the cases that this Court should deal with, being the first time this whole area of the law has been brought before any courts and, in our respectful submission, this is it.

Your Honours can see the tension in the Full Court’s reasoning if you go to paragraph 42 of their Honours’ reasoning at page 77 of the appeal book.  Before getting to that their Honours say that there are difficulties with the argument, all of which are answered by the consideration of the expression “in substance”, the fact that we are a new drug, which was not referred to, and was made as a finding of fact and not disputed, and the fact that there is also claim 14 which was not considered.  Then in paragraph 42 their Honours say:

The appellant’s best point is that in ordinary usage a necessary integer of a whole would be regarded as falling within the scope of that whole.

Again, of course, no reference to “in substance” which is relevant:

However, in the context . . . we think that falling within the scope . . . in a patent specification means included amongst the things claimed.

We would say that so far we should have won.  Then they say:

Here, the substance, in itself, is not a thing claimed.

Not in substance falls within the scope of the claims, but “is not a thing claimed”, where it is in claim 1 and even more so in claim 14 which, of course, their Honours did not consider.

Your Honours may recall that the policy of this particular part was in relation to “pharmaceutical substances”.  The whole tenor of the explanatory memorandum and the second reaching speeches was to cover pharmaceutical substances broadly without restriction.  There is no suggestion that there should be any restriction on the sort of product that is being extended.  The only restriction is to the sort of processes, and that is what the words “per se” sought to do.

Now, they either did it or they did not do.  It may well be that they did not achieve what the legislature sought, but they certainly were not intended to, nor can they, in the light of pharmaceutical substances, be considered to be restricting the scope of what can be extended to an active ingredient alone.

In our respectful submission, your Honours, it is a matter of prime importance and for the very reasons why the legislature has said that this part had been brought into existence.  It means, because of section 78, which limits the scope of infringement that you can pursue when you extend the term of the patent, only to the form that is specifically in the claim, that is, to the pharmaceutical substance itself, makes it meaningless and must mean that section 70 has been wrongly construed.  May it please the Court.

McHUGH J:   Thank you.  We need not hear you, Mr McGowan.

This application concerns the construction of section 70(2) of the Patents Act.  In our opinion, the construction placed on the subsection by the Full Court of the Federal Court is at least arguably correct.  The case does not have sufficient prospects of success to warrant a grant of special leave to appeal.  As the Court has pointed out more than once, ordinarily questions arising under the Patents Act should be dealt with finally by the Full Court of the Federal Court.  The application is dismissed with costs.

AT 10.06 AM THE MATTER WAS CONCLUDED