Bristol-Myers Squibb Co v Apotex Pty Ltd (No 5) - [2013] FCA 1114

FEDERAL COURT OF AUSTRALIA
Bristol-Myers Squibb Company v Apotex Pty Ltd (No 5) [2013] FCA 1114

Citation: Bristol-Myers Squibb Company v Apotex Pty Ltd (No 5) [2013] FCA 1114

Parties: BRISTOL-MYERS SQUIBB COMPANY and OTSUKA PHARMACEUTICAL CO., LTD v APOTEX PTY LTD (ACN 096 916 148)

File number: NSD 1116 of 2009

Judge: YATES J

Date of judgment: 30 October 2013

Catchwords:
PATENTS – standard patent for improved form of anhydrous aripiprazole crystals having low hygroscopicity (Crystals B) – whether hygroscopicity is inherent property of given crystalline form of aripiprazole – whether disclosure of particular crystalline form of aripiprazole discloses its physicochemical properties including its hygroscopicity

PATENTS – validity – novelty – inevitable result – whether person skilled in the art carrying out directions in prior art patent specification before priority date would inevitably have obtained anhydrous aripiprazole crystals having the characteristic low hygroscopicity of Crystals B – whether directions in prior art patent specification disclose the invention as claimed

PATENTS – validity – novelty – whether disclosure of crystalline form of Crystals B in prior art publications discloses the invention as claimed – whether prior art publications should be treated as single source of information

PATENTS – validity – false suggestion or misrepresentation – statements in complete specification and correspondence in course of prosecuting application for patent

PATENTS – validity – inventive step – problem‑solution approach – whether person skilled in the art would be directly led as a matter of course to take steps that would lead to the invention as claimed

PATENTS – validity – manner of manufacture – whether working interrelationship between drug comprising Crystals B and commercial package carrying instructions for drug to be used to treat schizophrenia or its symptoms

PATENTS – validity – clarity – whether requirement that compound exhibits a particular endothermic peak is unclear for failure to specify whether one or more other endothermic peaks may also be present on analysis – whether requirement of mean particle size unclear for failure of claim to expressly stipulate a particular method of measuring mean particle size or range of particle sizes in a given sample

PATENTS – validity – fair basis – whether real and reasonably clear disclosure of Crystals B having certain particle size as part of invention

PATENTS – infringement – threatened infringement –contributory infringement – authorisation

PATENTS – standing to sue for infringement – whether first applicant is exclusive licensee of patent – right to manufacture aripiprazole under patent not conferred on licensee – consideration of meaning of “exclusive licensee”

Legislation: Copyright Act 1968 (Cth) s 101(1A)
National Health Act 1953 (Cth)
Patents Act 1949 (UK) s 101
Patents Act 1952 (Cth) ss 6, 96
Patents Act 1990 (Cth) ss 7, 13, 14, 18, 40, 117, 120(1), 138(3)

Cases cited: Aktiebolaget Hässle and Another v Alphapharm Pty Limited (2002) 212 CLR 411
Alphapharm Pty Ltd (ACN 002 359 739) v H Lundbeck A/S and Another (2008) 76 IPR 618
Apotex Pty Ltd (ACN 096 916 148) v Sanofi‑Aventis and Others (2009) 82 IPR 416
Apotex Pty Ltd v AstraZeneca AB and Another (No 4) (2013) 100 IPR 285
Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd and Others (No 2) (2012) 204 FCR 494
Bristol‑Myers Squibb Company v F H Faulding & Co Limited (2000) 97 FCR 524
Evans Medical Ltd’s Patent [1998] RPC 517
Ex parte British Nylon Spinners Limited and Imperial Chemical Industries Limited; In re Imperial Chemical Industries Limited’s Patent (1963) 109 CLR 336
Grant and Another v Australian Temporary Fencing Pty Ltd (2003) 59 IPR 170
In the Matter of Courtaulds Ld.’s Application for Extension of the Term of Letters Patent No. 511,160 [1956] RPC 208
Lockwood Security Products Pty Ltd v Doric Products Pty Ltd [No 2] (2007) 235 CLR 173
Pharmacia Italia SpA and Another v Interpharma Pty Ltd (2005) 67 IPR 397
Prestige Group (Australia) Pty Ltd v Dart Industries Inc (1990) 26 FCR 197
Sanofi-Aventis Australia Pty Ltd and Others v Apotex Pty Ltd (No 3) (2011) 196 FCR 1
Sigma Pharmaceuticals (Australia) Pty Ltd v Wyeth and Another (2010) 88 IPR 459
Smith & Nephew Pty Ltd (ACN 000 087 507) v Wake Forest University Health Sciences and Another (2009) 82 IPR 467
TheGeneral Tire & Rubber Company v. The Firestone Tyre and Rubber Company Limited and Others [1972] RPC 457
The University of New South Wales v Moorhouse and Another (1975) 133 CLR 1
The Wellcome Foundation Limited v V.R. Laboratories (Aust.) Proprietary Limited (1981) 148 CLR 262
Uprising Dragon Ltd and Another v Benedict Trading & Shipping Pty Ltd and Others (1987) 16 FCR 93
Vehicle Monitoring Systems Pty Ltd (ACN 107 396 136) v Sarb Management Group Pty Ltd (t/as Database Consultants Australia) (ACN 106 549 722) (No 2) (2013) 101 IPR 496
Wake Forest University Health Sciences and Others v Smith & Nephew Pty Ltd (ACN 000 087 507) and Others (No 2) (2011) 92 IPR 496

Date of hearing: 10, 11, 12, 13, 14, 17, 18, 19, 20, 21 December 2012

Place: Sydney

Division: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 446

Counsel for the Applicants: Mr AJL Bannon SC with Ms CL Cochrane

Solicitor for the Applicants: Allens

Counsel for the Respondent: Mr DK Catterns QC with Mr NR Murray

Solicitor for the Respondent: Herbert Smith Freehills

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION

NSD 1116 of 2009

BETWEEN:
BRISTOL-MYERS SQUIBB COMPANY
First Applicant

OTSUKA PHARMACEUTICAL CO., LTD
Second Applicant

AND:
APOTEX PTY LTD (ACN 096 916 148)
Respondent

JUDGE:

YATES J

DATE OF ORDER:

30 OCTOBER 2013

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:
1.The parties bring in, by no later than 4.00 pm on 8 November 2013, draft orders reflecting the reasons for judgment today.
2.If the parties are unable to agree on draft orders, each party provide, by no later than 4.00 pm on 13 November 2013, draft orders with written submissions in respect of the orders sought, not exceeding three pages.
3.If the second applicant wishes to pursue its claim for infringement of claim 14 of Patent No. 2002334413, the second applicant and the respondent each have leave to provide additional written submissions, not exceeding three pages, on that question. These submissions are to be provided by no later than 4.00 pm on 13 November 2013.
4.Subject to any agreement reached between the parties or further order, the reasons for judgment today not be disclosed to the parties (other than their respective external legal representatives) or published more generally until 8 November 2013. This order is made to prevent prejudice to the proper administration of justice.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION

NSD 1116 of 2009

BETWEEN:
BRISTOL-MYERS SQUIBB COMPANY
First Applicant

OTSUKA PHARMACEUTICAL CO., LTD
Second Applicant

AND:
APOTEX PTY LTD (ACN 096 916 148)
Respondent

JUDGE:

YATES J

DATE:

30 OCTOBER 2013

PLACE:

SYDNEY

REASONS FOR JUDGMENT

Introduction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [1]

Relevant scientific concepts........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [7]

Crystalline compounds........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [8]

Polymorphism........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [11]

Hydrates and solvates........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [15]

Amorphous forms........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [17]

Analytical methods........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [19]

NMR spectroscopy........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [19]

Powder x-ray diffraction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [22]

Infrared spectroscopy........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [28]

Differential scanning calorimetry........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [30]

Thermogravimetric/differential thermal analysis........ ........ ........ ........ ........ ........ ....... [34]

The witnesses........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [37]

The patent........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [40]

The development of the claimed invention........ ........ ........ ........ ........ ........ ........ ........ ....... [73]

Polymorphism and hygroscopicity........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [89]

The prior art........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [120]

The 141 application........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [121]

The Aoki article........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [127]

The Aoki poster........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [137]

Validity: novelty........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [139]

The 141 application........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [143]

Introduction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [143]

The McGeary protocol........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [145]

Other evidence concerning the McGeary protocol........ ........ ........ ........ ........ ........ ... [157]

The McGeary experiment........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [172]

Other evidence concerning the McGeary experiment........ ........ ........ ........ ........ ....... [182]

The White protocol........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [202]

Other evidence concerning the White protocol........ ........ ........ ........ ........ ........ ........ [209]

The White experiment........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [216]

Other evidence concerning the White experiment........ ........ ........ ........ ........ ........ .... [231]

Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [244]

The Aoki article and the Aoki poster........ ........ ........ ........ ........ ........ ........ ........ ........ .... [280]

Validity: false suggestion........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [297]

Validity: inventive step........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [317]

Validity: manner of manufacture........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [359]

Validity: clarity........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [369]

Validity: fair basis........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [387]

Infringement ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [393]

Exclusive licence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [413]

Miscellaneous rulings on evidence ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [441]

Disposition ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [443]
INTRODUCTION

The applicants allege that the respondent, Apotex Pty Ltd (Apotex), has infringed or threatened to infringe certain claims of Patent No. 2002334413, which is entitled “Low hygroscopic aripiprazole drug substance and processes for the preparation thereof” (the patent). Aripiprazole is an atypical antipsychotic agent that is useful for the treatment of schizophrenia.
The second applicant, Otsuka Pharmaceutical Co., Ltd (Otsuka), is the patentee. The first applicant, Bristol‑Myers Squibb Company (BMS), claims to be the exclusive licensee of the patent.
Prior to 20 October 2009, Apotex offered to sell in Australia variously‑branded pharmaceutical products that contain aripiprazole as the active ingredient (the Apotex products). The Apotex products are included in the Australian Register of Therapeutic Goods (the ARTG) for the treatment of schizophrenia. In essence, the applicants alleged that Apotex’s sale of the Apotex products infringes or would lead to infringement of the patent. On 20 October 2009, Apotex agreed to orders that restrained it from supplying the Apotex products until the applicants’ claims were determined.
Apotex challenged the validity of the claims asserted against it. It contended that the invention as claimed is not novel, does not involve an inventive step, and is not a manner of manufacture within the meaning of s 6 of the Statute of Monopolies. It also contended that some of the claims are not clear or fairly based on the matter described in the complete specification of the patent. Further, it contended that the patent was obtained on a false suggestion or misrepresentation. In these reasons, I deal with the grounds of invalidity advanced in the order in which the parties addressed them in their submissions, namely, novelty, false suggestion, inventive step, manner of manufacture, clarity, and fair basis.
The present hearing is concerned only with the validity of the asserted claims and Apotex’s liability for infringement. These questions are governed by the Patents Act 1990 (Cth) (the Act) in the form in which it existed as at 1 April 2002, taking into account the amendments made by Act No. 160 of 2001.
For the reasons that follow, I have concluded that Apotex’s challenges to the validity of the asserted claims fail, other than in respect of its challenge to claim 45 which, in my view, does not claim an invention that is a manner of manufacture within the meaning of the Statute of Monopolies. I have also concluded that the second applicant’s case on infringement succeeds on all asserted claims other than in respect of claim 45 (which is invalid), claim 43 which is directed to the preparation of a medicament to treat schizophrenia and its symptoms, and claim 14, in respect of which I wish to receive further submissions.
RELEVANT SCIENTIFIC CONCEPTS
In order to understand more fully the invention claimed in the patent, as well as the disclosures of the relevant prior art, it is necessary to have an understanding of a number of scientific concepts. The parties produced a primer which describes these concepts and which was tendered as Exhibit B. The primer is based substantially on the evidence given by two of the expert witnesses. It is desirable to refer briefly to some aspects of these concepts to assist in reading these reasons.
Crystalline compounds
Crystalline compounds have a structure in which the constituents making up the crystal are arranged in a regular repeated manner. Crystallisation is the process in which atoms, molecules or ions of a compound in solution come together to form a solid material in which the constituents are arranged in a regular lattice. The smallest group which, when repeated, forms a crystal lattice is a unit cell.
When molecules or ions are in solution, they are usually freely and randomly dispersed and interact only with the solvent. When the solution becomes more concentrated or the temperature is reduced, the potential for interaction between the molecules or ions increases. When the potential for interaction between the molecules or ions is greater than their interaction with the solvent, the solution contains more of the dissolved species than the solution can support at equilibrium. At this point, the solution is capable of supporting crystallisation and is said to be supersaturated.
Crystallisation starts with nucleation, during which the first unit cell is formed. If the unit cell is stable, the nucleus can continue to grow to form a crystal. The second stage of the process is the subsequent growth of the nuclei. Nucleation and crystal growth can occur simultaneously while the solution remains supersaturated. Once the supersaturation is exhausted, the solid-liquid system reaches equilibrium and the crystallisation is complete.
Polymorphism
A solid material that is capable of crystallising into two or more structurally different but chemically identical crystalline forms is said to be polymorphic. Each polymorph will almost always have a different unit cell.
With an organic compound like aripiprazole, there is the theoretical potential for the formation of different polymorphs by the molecule folding in different ways. If the molecule or ion has one of its substituents, for example, twisted under rather than over, significant energy is likely to be required to allow that substituent to move into a different position. If the product crystallises in one orientation, it is quite likely to remain in that orientation unless the crystal is exposed to factors such as heat, light or moisture, which facilitate a change in conformation.
Different polymorphs have different physical properties such as handling properties, solubility, density, hardness, stability, crystal habit (the external shape of the crystal as a whole), hygroscopicity (the tendency to absorb water), wettability (the ability of a polymorph to be wetted by a liquid, as a precursor to dissolution), melting point, filterability, and dryability. The choice of polymorph is an important part of drug development. The choice will impact on the stability and useability of the pharmaceutical composition containing the polymorph.
Particle size is not a characteristic of a particular crystalline form. It is only a qualification of the size of the crystals having that form.
Hydrates and solvates

Sometimes, during the process of crystallisation, molecules of water, solvent or impurities may be regularly incorporated into the crystal structure. Where water molecules are incorporated into the crystal structure in a regularly‑repeating manner, a hydrate is formed. Where a solvent other than water is incorporated into the crystal structure in a regularly‑repeating manner, a solvate is formed.
Hydrates and solvates are sometimes called pseudopolymorphs. Although often considered in the same context, hydrates and solvates are not polymorphs but new chemical compounds that incorporate additional molecules within their crystal structure.
Amorphous forms
Some non-crystalline materials exist as amorphous solids. In amorphous solids, the molecules are disordered in the sense that they are not arranged in a way that has a regular and repeated long‑range structure (as a crystalline solid has). While amorphous material can be less stable and more susceptible to degradation, and can be difficult to obtain reliably in a consistent composition, it can also have advantages for certain applications. For example, if it can be reliably obtained, amorphous material may be more soluble than crystalline material.
While, in the large majority of cases, formulators of medicinal preparations choose crystalline forms, on some occasions, they elect to use amorphous forms. This might be so where, for example, the solubility of a substance is a particular problem.
Analytical methods
NMR spectroscopy
Relevantly, spectroscopy is the study of the absorption and emission by compounds of different types of electromagnetic radiation. Nuclear magnetic resonance (NMR) spectroscopy is a form of spectroscopy that uses radiowaves. NMR spectroscopy is widely used in chemical analysis. A sample or solution of the compound of interest is placed in a strong magnetic field and irradiated with radiowaves. The absorption of radiowaves by certain atoms is measured and gives a unique spectrum for that compound. This technique is routinely used to determine the chemical structure of unknown substances.
The most common applications of NMR spectroscopy in organic chemistry are ¹H‑NMR (or proton NMR), which provides information regarding hydrogen atoms (which contain a single proton) in the compound, and ¹³C-NMR (or carbon 13 NMR), which provides information about carbon atoms in the compound. The information provided by these techniques, respectively, includes information regarding the number of hydrogen and carbon atoms present in the compound, the environment in which these atoms are present, and the relative number and types of hydrogen and carbon atoms.
While ¹H-NMR and ¹³C-NMR spectra are characteristic of the chemical components of a crystal, they are not characteristic of any particular crystalline form. Measurement of the ¹H-NMR and ¹³C-NMR spectra as typically performed involves samples that have been dissolved, so that the crystalline form has been broken down. Therefore, different crystalline or polymorphic forms will have the same ¹H-NMR and ¹³C-NMR spectra.
Powder x-ray diffraction
The shape of the unit cell is defined by three unit cell lengths and three unit cell angles (the lattice parameters). The unit cell has a definite volume that contains the atoms, molecules, and ions necessary for generating the crystal.
X-ray diffraction (XRD) is an analytical technique that is used to obtain information about the unit cell shape and structure of a crystalline substance. It is based on the diffraction of x-rays by crystalline solids. In this technique, a beam of x-rays, typically of the same wavelength, is directed at a crystalline substance. When the beam hits the substance, it is diffracted by the atoms, molecules or ions in the crystal structure at certain special orientations, creating a diffractogram or diffraction pattern (XRD pattern). The lattice parameters determine these special orientations and, hence, the positions of peaks shown in the XRD pattern.
Powder x-ray diffraction (XRPD or, sometimes, PXRD) is a particular form of XRD in which the sample of interest is crushed or ground to a fine powder and analysed using an x-ray diffractometer. The x-rays are confined to a parallel (collimated) beam and directed onto the sample, which is located at the centre of the instrument. The angles through which the incident x-ray beams are diffracted are measured by a moveable detector arm. The angle measured by the detector through which the incident x-ray beam is diffracted is twice the angle θ (theta). The angle is known as °2θ. It is common for XRPD results to be quoted by reference to this angle.
In the powder sample, there are a multitude of small single crystals or “crystallites”. The object is for the crystallites to be packed into or adhered to a sample holder in random orientations. The x-ray source, sample, and detector can then be moved through a range of angles to measure the diffraction pattern generated by the powder (the XRPD pattern). The results obtained are a series of diffraction angles and x-ray intensities measured as a function of the angle °2θ. These results are recorded by a computer. Software is then used to generate an XRPD pattern that may be used to pick the peak positions. The locations of the peaks in the XRPD pattern are related to the spacing between the planes in the crystal lattice according to Bragg’s law: nλ = 2d sin θ.
Importantly, every crystalline form of a particular crystalline substance has a unique unit cell that produces a unique XRPD pattern. This pattern is like a fingerprint. It distinguishes one crystalline form of that substance from other crystalline forms. For any given crystalline form, the positions of the diffracted peaks are precisely determined by Bragg’s law.
The XRPD pattern obtained for any given sample is subject to variation depending on a number of factors. When comparing sets of XRPD data, it is important to ensure that the parameters or settings (notably, the wavelength of the x-ray source) are the same (or that any differences are taken into account) as the measured angles of diffraction will vary.
Infrared spectroscopy
Infrared (IR) spectroscopy uses electromagnetic radiation having a wavelength in the IR region. It covers a range of techniques, the most common of which is absorption spectroscopy, where IR radiation of varying wavelengths is directed at a compound of interest and some wavelengths are absorbed, giving a unique IR spectrum that can be used to identify a compound with the IR spectrum of a reference sample of that compound.
The frequencies of radiation that are absorbed are referred to as absorption bands. These are characteristic of particular combinations of atoms within a molecule. Before the spectrum is recorded, the material is finely dispersed within potassium bromide (KBr). When this process is undertaken with appropriate care, an IR (KBr) spectrum can assist in distinguishing between different crystal forms.
Differential scanning calorimetry
Differential scanning calorimetry (DSC) accurately measures the difference in the amount of heat required to increase the temperature of a sample being analysed relative to that of a reference material, across a range of temperatures. During heating, the material may undergo one or more phase transitions. These transitions may result in the material absorbing heat (endothermic) or releasing heat (exothermic). The absorption or release of heat relative to the reference sample is plotted as a thermogram and phase transitions are recorded as endothermic or exothermic peaks. For example, melting or a change in polymorphic form will result in an endothermic peak and crystallisation or decomposition of the sample will result in an exothermic peak.
A peak may also correspond to the amount of work done on the sample to release and evaporate water or solvent from a hydrate or solvate, respectively. The amount of work done on the sample is characteristic of the quantity of the water or solvent. The temperature at which the work is done is characteristic of the way in which the water or solvent is bound within the sample.
Peaks associated with a phase transition and/or a release of water or solvent may be coincident. These peaks are, therefore, characteristic of a particular crystalline form.
DSC analysis cannot be used in the absence of other information to definitively identify a compound. However, data obtained through DSC can be used in conjunction with other data to support the identification of a compound.
Thermogravimetric/differential thermal analysis
Thermogravimetric analysis (TGA) measures weight loss in a sample as it is heated. Weight loss is generally associated with either the loss of a volatile component present in the sample (for example, any solvent present in the sample, including as a solvate) or the decomposition of the sample. This form of analysis cannot be used in the absence of other information to definitively identify a compound. It can be used in conjunction with other data to support the identification of a compound.
Differential thermal analysis (DTA) involves heating a sample and a reference sample at a constant rate while recording the difference in temperature between the two samples. This results in endothermic and exothermic peaks that are similar to those obtained in DSC thermograms. This form of analysis cannot be used in the absence of other information to definitively identify a compound. It can be used in conjunction with other data to support the identification of a compound.
TGA/DTA accurately measures changes in weight of a sample as a function of changes in temperature. It is useful for measuring the temperature at which water or a solvent is released and evaporates from a hydrate or a solvate, respectively. The temperature is characteristic of the way in which the water or solvent is bound within the sample and is, therefore, characteristic of a particular crystalline form.
THE WITNESSES
The applicants adduced evidence from the following witnesses:
·Satoshi Aoki. Mr Aoki is named as an inventor in the patent. He is an associate manager and researcher in the Bulk Pharmaceutical Chemicals Department at Otsuka’s Second Tokushima Factory. Mr Aoki made one affidavit that was read at the hearing.
·Clive Allan Prestidge. Professor Prestidge is a professor of colloid and pharmaceutical science at the Ian Wark Research Institute, University of South Australia. Professor Prestidge made one affidavit that was read at the hearing.
·Christopher John Easton. Professor Easton is a professor at the Research School of Chemistry, Institute of Advanced Studies, Australian National University. Professor Easton made two affidavits that were read at the hearing.
·Jonathan Michael White. Associate Professor White is an associate professor and reader at the School of Chemistry, University of Melbourne. He made one affidavit that was read at the hearing.
·Raymond Leslie Withers. Professor Withers is a professor and head of the Materials Chemistry Group at the Research School of Chemistry, Australian National University. He made one affidavit that was read at the hearing.
Apotex adduced evidence from the following witnesses:
·Ross Peter McGeary. Associate Professor McGeary is an associate professor with a shared appointment in the School of Chemistry and Molecular Biosciences and the School of Pharmacy at the University of Queensland. He made two affidavits that were read at the hearing.
·David St Clair Black. Professor Black is a professor of organic chemistry at the University of New South Wales. He made two affidavits that were read at the hearing.
·James Steven Rowe. Dr Rowe is a pharmaceutical formulation chemist and consultant. He made two affidavits that were read at the hearing.
These witnesses, other than Professor Withers, were cross-examined. Despite some criticisms by the parties in final submissions of the evidence given by some witnesses, I found the evidence of all witnesses to be helpful in understanding the scientific issues arising in this case. Where criticisms have been made, I have dealt with them, to the extent that I consider necessary, when discussing aspects of the evidence later in these reasons.
THE PATENT
The patent is a standard patent. It was granted on a PCT application (PCT/JP02/09858) taken as filed on 25 September 2002 and published as WO 03/026659. The claims of the patent claim priority from three basic applications: Japanese Patent Application No. 2001-290645 filed on 25 September 2001; Japanese Patent Application No. 2001-348276 filed on 14 November 2001; and Canadian Patent Application No. 2379005 filed on 27 March 2002. Thus, the earliest priority date of the claims of the patent is 25 September 2001.
The patent claims were amended by an order made pursuant to s 105 of the Act on 13 August 2010: see Bristol-Myers Squibb Co and Another v Apotex Pty Ltd (ACN 096 916 148) (2010) 87 IPR 516 (the amendment reasons).
The invention described in the patent relates to an improved form of aripiprazole having reduced hygroscopicity.
The complete specification describes, as background to the invention, two published methods of manufacturing anhydrous crystals of aripiprazole. The term “anhydrous” means that the compound contains no combined water.
The first method is disclosed in Example 1 of Japanese Unexamined Patent Publication No. 191256/1990 (the Japanese unexamined patent publication). It involves reacting 7-(4-bromobutoxy)-3,4-dihydrocarbostyril with 1-(2,3-dichlorophenyl)piperazine to produce raw anhydrous aripiprazole, which is then recrystallised with ethanol. The second method is disclosed in Proceedings of the 4^th Japanese-Korean Symposium on Separation Technology (6-8 October 1996) (the Symposium), specifically, in documents referred to in the present case as the Aoki article and the Aoki poster. This method involves heating aripiprazole hydrate at 80°C.
The disclosures of the 141 application, the Aoki article, and the Aoki poster, which are described in greater detail below, constitute important prior art information. They are the foundation for Apotex’s case that the invention, as relevantly claimed, is not novel and is obvious, and that the patent was obtained on a false suggestion.
The complete specification states that the anhydrous crystals obtained by the two disclosed methods have the disadvantage of being significantly hygroscopic. The complete specification describes this disadvantage as follows:
The hygroscopicity of these crystals makes them difficult to handle since costly and burdensome measures must be taken in order to ensure they are not exposed to moisture during process and formulation. Exposed to moisture, the anhydrous form can take on water and convert to a hydrous form. This presents several disadvantages. First, the hydrous forms of aripiprazole have the disadvantage of being less bioavailable and less dissoluble than the anhydrous forms of aripiprazole. Second, the variation in the amount of hydrous versus anhydrous aripiprazole drug substance from batch to batch could fail to meet specifications set by drug regulatory agencies. Third, the milling may cause the drug substance, Conventional Anhydrous Aripiprazole, to adhere to manufacturing equipment which may further result in processing delay, increased operator involvement, increased cost, increased maintenance and lower production yield. Fourth, in addition to problems caused by introduction of moisture during the processing of these hygroscopic anhydrous crystals, the potential for absorbance of moisture during storage and handling would adversely affect the dissolubility of aripiprazole drug substance. Thus shelf-life of the product could be significantly decreased and/or packaging costs could be significantly increased. It would be highly desirable to discover a form of aripiprazole that possessed low hygroscopicity thereby facilitating pharmaceutical processing and formulation operations required for producing dosage units of an aripiprazole medicinal product having improved shelf-life, suitable dissolubility and suitable bioavailability.
The complete specification says that these anhydrous crystals (which are referred to in other passages of the complete specification as “conventional” anhydrous aripiprazole crystals) (conventional anhydrous aripiprazole crystals) exist as “type-I” crystals and “type-II” crystals. Type-I crystals can be prepared by the methods discussed above. Type‑II crystals can be prepared by heating the type-I crystals at 130°C to 140°C for 15 hours. However, by using these methods, type-II crystals having high purity cannot be easily prepared on an industrial scale with good repeatability.
The type-I and type-II crystals are referred to in the Aoki article as type 1 and type 2 crystals, respectively. I will use that nomenclature when further discussing the complete specification and the evidence. As I will explain later, the Aoki article also refers to type 3 crystals in the form of a hydrate.
The complete specification summarises the invention in the following terms:
Thus according to the present invention there is provided a form of aripiprazole having reduced hygroscopicity and which is more amenable to pharmaceutical processing and formulation. The inventors of the present invention have discovered that this reduced-hygroscopic form of Aripiprazole is a crystalline substance defined herein as Anhydrous Aripiprazole Crystals B. A particular process for the preparation of this anhydrous crystalline substance has also been discovered and comprises yet another aspect of the present invention. Particularly, it was discovered as part of the present invention that in order to produce Anhydrous Aripiprazole Crystals B having the desired pharmaceutical properties and utilizing the most efficient process, Hydrate A, as defined herein, would have to serve as the intermediate. It was also discovered that a particular sequence of processing had to be implemented in order to form Hydrate A. It was discovered that the preparation of Hydrate A required milling what is defined herein as Conventional Hydrate. Then, Hydrate A can be transformed into Anhydrous Aripiprazole Crystals B through suitable heating as defined herein. Surprisingly, if the Conventional Hydrate is first heated and then milled, serious agglomeration sets in rendering the processing commercially unsuitable.
Advantageously at least one embodiment of the present invention provides novel anhydrous aripiprazole crystals.
Moreover, another advantage of at least one embodiment of the present invention is that anhydrous aripiprazole crystals which neither easily convert into hydrates nor substantially decrease the original solubility, even when a pharmaceutical composition comprising anhydrous aripiprazole is stored for a long period of time may be provided.
A further advantage of at least one embodiment of the present invention is that preparation methods, in order to obtain anhydrous aripiprazole crystals having high purity in an industrial scale with good repeatability may be provided.
The present inventors have conducted research works aimed to attain the aforementioned advantages. In the course of the research, they have found that the desired anhydrous aripiprazole crystals can be obtained when a well‑known anhydrous aripiprazole is heated at a specific temperature. Further, the present inventors have found that the desired anhydrous aripiprazole crystals can be obtained from recrystallization of a well-known anhydrous aripiprazole by using the specific solvents. Moreover, the present inventors found that the desired anhydrous aripiprazole crystals can be obtained by suspending a well-known anhydrous aripiprazole in the specific solvent, and heating the thus obtained suspension.
The present invention is thus completed on the basis of these findings and knowledge.

To summarise, these passages from the complete specification disclose a form of aripiprazole that is more amenable to pharmaceutical processing and formulation as well as the most efficient process then known by which that form can be obtained. That process uses Hydrate A as an intermediate which is then transformed into Anhydrous Aripiprazole Crystals B (Crystals B) “through suitable heating”.
Despite what is said in the complete specification, Conventional Hydrate (conventional hydrate) is not defined. However, a process for preparing conventional hydrate is described. The complete specification states that anhydrous aripiprazole crystals obtained from the method in Example 1 of the Japanese unexamined patent publication are dissolved in a hydrous solvent, heated, and then cooled, such that aripiprazole hydrate is precipitated as crystals in the hydrous solvent. The complete specification describes the hydrous solvent in the following terms:
An organic solvent containing water is usually used as the hydrous solvent. The organic solvent should be one which is miscible with water, such as for example an alcohol such as methanol, ethanol, propanol or isopropanol, a ketone such as acetone, an ether such as tetrahydrofuran, dimethylformamide, or a mixture thereof, with ethanol being particularly desirable. The amount of water in the hydrous solvent can be 10-25% by volume of the solvent, or preferably close to 20% by volume.
The complete specification discloses a process for manufacturing Hydrate A:
Hydrate A is manufactured by milling Conventional Hydrate. Conventional milling methods can be used to mill Conventional Hydrate. For example, Conventional Hydrate can be milled in a milling machine. A widely used milling machine can be used, such as an atomizer, pin mill, jet mill or ball mill. Of these, the atomizer is preferred.
Regarding the specific milling conditions when using an atomizer, a rotational speed of 5000-15000 rpm could be used for the main axis, for example, with a feed rotation of 10-30 rpm and a screen hole size of 1-5 mm.
The mean particle size of the Aripiprazole Hydrate A obtained by milling should normally be 50 µm or less, preferably 30 µm or less. Mean particle size can be ascertained by the particle size measurement method described hereinafter.
The complete specification characterises Hydrate A in the following terms:
Particles of “Hydrate A” as used herein have the physicochemical properties given in (1) - (5) below:
(1)It has an endothermic curve which is substantially the same as the thermogravimetric/differential thermal analysis (heating rate 5°C/min) endothermic curve shown in Figure 1. Specifically, it is characterized by the appearance of a small peak at about 71°C and a gradual endothermic peak around 60°C to 120°C.
(2)It has an ¹H-NMR spectrum which is substantially the same as the ¹H-NMR spectrum (DMSO-d₆, TMS) shown in Figure 2. Specifically, it has characteristic peaks at 1.55-1.63 ppm (m, 2H), 1.68-1.78 ppm (m, 2H), 2.35‑2.46 ppm (m, 4H), 2.48-2.56 ppm (m, 4H + DMSO), 2.78 ppm (t, J = 7.4 Hz, 2H), 2.97 ppm (brt, J = 4.6 Hz, 4H), 3.92 ppm (t, J = 6.3 Hz, 2H), 6.43 ppm (d, J = 2.4 Hz, 1H), 6.49 ppm (dd, J = 8.4 Hz, J = 2.4 Hz, 1H), 7.04 ppm (d, J = 8.1 Hz, 1H), 7.11-7.17 ppm (m, 1H), 7.28-7.32 ppm (m, 2H) and 10.00 ppm (s, 1H).
(3)It has a powder x-ray diffraction spectrum which is substantially the same as the powder x-ray diffraction spectrum shown in Figure 3. Specifically, it has characteristic peaks at 20 = 12.6°, 15.4°, 17.3°, 18.0°, 18.6°, 22.5° and 24.8°.
(4)It has clear infrared absorption bands at 2951, 2822, 1692, 1577, 1447, 1378, 1187, 963 and 784 cm^-1 on the IR (KBr) spectrum.
(5)It has a mean particle size of 50 µm or less.
The complete specification characterises Crystals B in the following terms:
“Anhydrous Aripiprazole Crystals B” of the present invention as used herein have the physicochemical properties given in (6) - (12) below.
(6)They have an ¹H-NMR spectrum which is substantially the same as the ¹H‑NMR spectrum (DMSO-d₆, TMS) shown in Figure 4. Specifically, they have characteristic peaks at 1.55-1.63 ppm (m, 2H), 1.68-1.78 ppm (m, 2H), 2.35-2.46 ppm (m, 4H), 2.48-2.56 ppm (m, 4H + DMSO), 2.78 ppm (t, J = 7.4 Hz, 2H), 2.97 ppm (brt, J = 4.6 Hz, 4H), 3.92 ppm (t, J = 6.3 Hz, 2H), 6.43 ppm (d, J = 2.4 Hz, 1H), 6.49 ppm (dd, J = 8.4 Hz, J = 2.4 Hz, 1H), 7.04 ppm (d, J = 8.1 Hz, 1H), 7.11-7.17 ppm (m, 1H), 7.28-7.32 ppm (m, 2H) and 10.00 ppm (s, 1H).
(7)They have a powder x-ray diffraction spectrum which is substantially the same as the powder x-ray diffraction spectrum shown in Figure 5. Specifically, they have characteristic peaks at 20 = 11.0°, 16.6°, 19.3°, 20.3° and 22.1°.
(8)They have clear infrared absorption bands at 2945, 2812, 1678, 1627, 1448, 1377, 1173, 960 and 779 cm^-1 on the IR (KBr) spectrum.
(9)They exhibit an endothermic peak near about 141.5°C in thermogravimetric/differential thermal analysis (heating rate 5°C/min).
(10)They exhibit an endothermic peak near about 140.7°C in differential scanning calorimetry (heating rate 5°C/min).
(11)Anhydrous Aripiprazole Crystals B of the present invention have low hygroscopicity. For example, Anhydrous Aripiprazole Crystals B of the present invention maintain a water content of 0.4% or less after 24 hours inside a closed container set at a temperature of 60°C and a humidity of 100%. Well-known methods of measuring water content can be used as long as they are methods commonly used for measuring the water content of crystals. For example, a method such as the Karl Fischer method can be used.
(12)When the small particle size is required for the formulation such as tablet and other solid dose formulations including for example flashmelt formulations, the mean particle size is preferably 50 µm or less.
The complete specification discloses the following processes by which Crystals B can be manufactured:
In case of the formulation for which small particle size (less than 50 µm) is required, the milling is necessary for the preparation. However, when a large amount of Conventional Anhydrous Aripiprazole or Anhydrous Crystals B having large particle size is milled, the milled substances adhere with each other in the milling machine. Accordingly, there is a disadvantage that it is difficult to industrially prepare Anhydrous Aripiprazole Crystals B having small particle size.
Under the circumstances, the inventors of the present invention have found that Conventional Hydrate can be easily milled, and Anhydrous Aripiprazole Crystals B having small particle size can be obtained in high yield with good-operability by heating the milled hydrate A thus obtained.
The Anhydrous Aripiprazole Crystals B of the present invention are prepared for example by heating the aforementioned Aripiprazole Hydrate A at 90-125°C. The heating time is generally about 3-50 hours, but cannot be stated unconditionally since it differs depending on heating temperature. The heating time and heating temperature are inversely related, so that for example the heating time will be longer the lower the heating temperature, and shorter the higher the heating temperature. Specifically, if the heating temperature of Aripiprazole Hydrate A is 100°C, the heating time should normally be 18 hours or more or preferably about 24 hours. If the heating temperature of Aripiprazole Hydrate A is 120°C, on the other hand, the heating time can be about 3 hours. The Anhydrous Aripiprazole Crystals B of the present invention can be prepared with certainty by heating Aripiprazole Hydrate A for about 18 hours at 100°C, and then heating it for about 3 hours at 120°C. The Anhydrous Aripiprazole Crystals B of the present invention can also be obtained if the heating time is extended still further, but this may not be economical.
When small particle size is not required for the formulation, e.g., when drug substance is being manufactured for injectable or oral solution formulations, Anhydrous Aripiprazole Crystals B can be also obtained [by] the following process.
The inventors also discovered that it is possible to obtain anhydrous aripiprazole crystals by heating conventional aripiprazole hydrate or conventional anhydrous aripiprazole crystals to a specific temperature but this process does not yield Anhydrous Aripiprazole Crystals B as a crystalline substance suitable for commercial use in the formulation of solid oral dose formulations.
Furthermore, the Anhydrous Aripiprazole Crystals B of the present invention are prepared for example by heating conventional anhydrous aripiprazole crystals at 90‑125°C. The heating time is generally about 3-50 hours, but cannot be stated unconditionally since it differs depending on heating temperature. The heating time and heating temperature are inversely related, so that for example the heating time will be longer the lower the heating temperature, and shorter the higher the heating temperature.
Specifically, if the heating temperature of the anhydrous aripiprazole crystals is 100°C, the heating time can be about 4 hours, and if the heating temperature is 120°C the heating time can be about 3 hours.
Later, the complete specification discloses processes for preparing conventional (or crude) aripiprazole crystals, conventional anhydrous aripiprazole, and conventional hydrate. It again discloses a process for preparing Crystals B.
In relation to the preparation of conventional (or crude) aripiprazole crystals, the complete specification exemplifies, once again, Example 1 of the Japanese unexamined patent publication (although, in more detail). In relation to the preparation of conventional anhydrous aripiprazole crystals, the complete specification merely states that the method is that described in the Symposium (in other words, the Aoki article and the Aoki poster). Despite the different nomenclature used in this part of the complete specification, both described methods result in the production of conventional anhydrous aripiprazole crystals.
In relation to the preparation of Crystals B, the complete specification exemplifies the heating of conventional hydrate at 90°C to 125°C in terms closely similar to the penultimate paragraph in the passage quoted in [55] above which concerns the heating of conventional anhydrous aripiprazole crystals.
The complete specification provides a number of reference examples. It is necessary to refer to three of them.
Reference Example 1 is in the following terms:
19.4 g of 7-(4-chlorobutoxy)-3,4-dihydrocarbostyril and 16.2 g of 1-(2,3-dichlorophenyl) piperadine [sic] 1 hydrochloride were added to 8.39 g of potassium carbonate dissolved in 140 ml of water, and circulated for 3 hours under agitation. After reaction the mixture was cooled and the precipitated crystals filtered out. These crystals were dissolved in 350 ml of ethyl acetate, and about 210 ml of water/ethyl acetate azeotrope removed under reflux. The remaining solution was cooled, and the precipitated crystals filtered out. The resulting crystals were dried for 14 hours at 60°C to produce 20.4 g (74.2%) of raw aripiprazole.
30 g of the raw aripiprazole obtained above was recrystallized from 450 ml of ethanol according to the methods described in Japanese Unexamined Patent Publication No. 191256/1990, and the resulting crystals dried for 40 hours at 80°C to obtain anhydrous aripiprazole crystals. The yield was 29.4 g (98.0%).
The melting point (mp) of these anhydrous aripiprazole crystals was 140°C, matching the melting point of the anhydrous aripiprazole crystals described in Japanese Unexamined Patent Publication No. 191256/1990.
When these crystals were left for 24 hours in a dessicator set at humidity 100%, temperature 60°C, they exhibited hygroscopicity of 3.28% …
Reference Example 2 is in the following terms:
6930 g of the intermediate raw aripiprazole obtained in Reference Example 1 was heat dissolved in 138 liters of hydrous ethanol (water content 20%) according to the method presented at the 4th Japanese-Korean Symposium on Separation Technology, gradually (2-3 hours) cooled to room temperature, and then chilled to near 0°C. The precipitated crystals were filtered out, producing about 7200 g of aripiprazole hydrate (wet state).
The wet-state aripiprazole hydrate crystals obtained above were dried for 30 hours at 80°C to obtain 6480 g (93.5%) of conventional anhydrous aripiprazole crystals. The melting point (mp) of these crystals was 139.5°C. These crystals were confirmed by the Karl Fischer method to be anhydrous, with a moisture value of 0.03%.
When left for 24 hours in a closed container set at humidity 100%, temperature 60°C, these crystals exhibited hygroscopicity of 1.78% …
Mr Aoki gave evidence that the crystals referred to in Reference Example 2 were type 1 crystals, as referred to in the Aoki article (corresponding to type-I crystals referred to in the complete specification).
Reference Example 3 is in the following terms:
820 g of the intermediate wet-state aripiprazole hydrate obtained in Reference Example 2 was dried for 2 hours at 50°C to obtain 780 g of aripiprazole hydrate crystals. These crystals had a moisture value of 3.82% according to the Karl Fischer method. As shown in Figure 6, thermogravimetric/differential thermal analysis revealed endothermic peaks at 75.0, 123.5 and 140.5°C. Because dehydration began near 70°C, there was no clear melting point (mp).
As shown in Figure 7, the powder x-ray diffraction spectrum of aripiprazole hydrate obtained by this method exhibited characteristic peaks at 20 = 12.6°, 15.1°, 17.4°, 18.2°, 18.7°, 24.8° and 27.5°.
The powder x-ray diffraction spectrum of this aripiprazole hydrate was identical to the powder x-ray diffraction spectrum of aripiprazole hydrate presented at the 4th Joint Japanese-Korean Symposium on Isolation Technology.
It is clear from the last paragraph of this description in Reference Example 3 that the hydrate so produced corresponds to the type 3 crystals referred to in the Aoki article.
After providing the reference examples, the complete specification provides a number of further examples. Examples 1 to 10 are relevant to the present case.
Example 1 concerns the production of Hydrate A by milling the aripiprazole hydrate crystals obtained in Reference Example 3.
Example 2 concerns the production of Crystals B by drying Hydrate A for 24 hours at 100°C. Examples 3 and 4 also concern the production of Crystals B by heating Hydrate A. In each case, the steps involved the hot‑air drying of Hydrate A for 18 hours at 100°C and then heating it for three hours at 120°C.
Examples 5 to 10 concern the production of Crystals B by heating conventional anhydrous aripiprazole crystals or conventional hydrate. In each case, the heating was carried out at 100°C (Examples 5, 7, and 9) or at 120°C (Examples 6, 8, and 10) on conventional anhydrous aripiprazole crystals obtained from the method in Reference Example 1 (Examples 5 and 6) and Reference Example 2 (Examples 7 and 8) or on conventional hydrate obtained from the method in Reference Example 3 (Examples 9 and 10). The complete specification says that Examples 5 to 10 are useful for injectable or oral solution formulations but not solid dose formulations because they were made by heating conventional anhydrous crystals or conventional hydrate instead of Hydrate A.
In each of Examples 2 to 10, the resulting crystals (that is, Crystals B) were left for 24 hours in a dessicator or closed container set at 100% humidity and 60°C. In each case, the crystals did not exhibit hygroscopicity exceeding 0.40%. Indeed, in each case, the hygroscopicity of these crystals was well below that percentage figure. However, when the resulting crystals of Reference Examples 1 and 2 were tested in the same way, the crystals, in each case, exhibited hygroscopicity well in excess of 0.40%. In the case of Reference Example 1, the hygroscopicity of the crystals was 3.28% and, in the case of Reference Example 2, the hygroscopicity was 1.78%.
The complete specification describes a number of other anhydrous aripiprazole crystals, designated respectively as Anhydrous Aripiprazole Crystals C to G. These crystals differ in their characteristics and are not directly relevant to the present case.
Claim 12 is of central significance to the case. Claim 12 claims Crystals B as follows:
Anhydrous Aripiprazole Crystals B wherein said crystals
have low hygroscopicity wherein said low hygroscopicity is a moisture content of 0.40% or less after placing said drug substance for 24 hours in a closed container maintained at a temperature of 60°C and a humidity level of 100%;
have a powder x-ray diffraction spectrum which is substantially the same as the following powder x-ray diffraction spectrum shown in Figure 5;
have particular infrared absorption bands at 2945, 2812, 1678, 1627, 1448, 1377, 1173, 960 and 779 cm^-1 on the IR (KBr) spectrum;
exhibit an endothermic peak near about 141.5°C in thermogravimetric/differential thermal analysis (heating rate 5°C/min); and
exhibit an endothermic peak near about 140.7°C in differential scanning calorimetry (heating rate 5°C/min).
A number of other claims are dependent, directly or indirectly, on claim 12 and are relied on by the applicants for their case on infringement. Those claims are claims 13, 14, 16, 30, 31, 35, 36, 43, 44, 45, 111, 112, 119, and 123. Those claims are reproduced in Schedule A to these reasons. As I have noted above, Apotex challenged the validity of these claims on a number of grounds.
THE DEVELOPMENT OF THE CLAIMED INVENTION
My findings concerning the development of the claimed invention are as follows.
Otsuka first synthesised aripiprazole in the laboratory in 1987. Within Otsuka, aripiprazole was designated as OPC-14597. The method by which aripiprazole was synthesised in the laboratory is disclosed in the 141 application.
From 1993, Otsuka made aripiprazole on a manufacturing scale by the following process (referred to in the evidence as Route I):
·crude aripiprazole was recrystallised from ethanol solution constituting 80% ethanol and 20% water to create aripiprazole hydrate;
·aripiprazole hydrate was dried at 80°C to make anhydrous aripiprazole; and
·the anhydrous aripiprazole was milled.
Otsuka began its Phase I clinical study on aripiprazole in Japan in 1990 and in the United States of America in 1993.
Aripiprazole manufactured industrially by Route I was found to be hygroscopic and this hygroscopicity posed a significant dissolution problem. Otsuka discovered in the course of conducting in vitro testing of aripiprazole tablets that there was a decrease in the dissolution rate of the aripiprazole. The decrease was caused when the aripiprazole, which initially existed as an anhydrate when manufactured, gradually turned into a hydrate as it absorbed moisture. The aripiprazole tablets with a decreased dissolution rate had lower bioavailability in patients with low levels of gastric acid compared to tablets with no decreased dissolution.
Otsuka commenced a research project to endeavour to solve this problem.
At the time that the Aoki article was submitted for publication (30 July 1996), Mr Aoki was continuing to investigate possible solutions to the hygroscopicity problem. In July 1996, he focused on a specific step in the manufacturing process of anhydrous aripiprazole. The step was to redry the aripiprazole after milling. Mr Aoki decided to investigate the effect of varying the conditions employed in drying the milled anhydrous aripiprazole. He ran experiments using the following temperatures and times:
·80°C for 4, 8, 24 or 48 hours;
·100°C for 4, 8, 24 or 48 hours; and
·120°C for 4, 8, 24 or 48 hours.
He tested the results using a rigorous hygroscopicity test in which the samples were exposed to conditions of 40°C and 100% relative humidity for two weeks (the two‑week test).

Mr Aoki’s evidence, which I accept, was that he did not know in advance whether any of the conditions would successfully produce aripiprazole with low hygroscopicity.
In September 1996, he found that:
·milled anhydrous aripiprazole redried at 80°C for 4, 8, 24 or 48 hours all showed hygroscopicity under the two‑week test;
·milled anhydrous aripiprazole redried at 100°C and 120°C for 4, 8, 24 or 48 hours showed no hygroscopicity under the two‑week test;
·redrying at a temperature of at least 100°C was sufficient to resolve the dissolution problem; and
·the two-week test was reliable, based on the consistent hygroscopicity and dissolution results which were produced when the same sample was submitted to this test.
These discoveries were later applied to a modified method of preparing anhydrous aripiprazole industrially. This modified method (referred to in the evidence as Route II) comprised the following steps:
·crude aripiprazole was recrystallised from ethanol solution constituting 80% ethanol and 20% water to create aripiprazole hydrate;
·the hydrate was milled; and
·the milled product was dried at 100°C for 24 hours.
In July 1999, Otsuka conducted hygroscopicity testing of aripiprazole at conditions of 60°C at 100% relative humidity for 24 hours. This is the test referred to in claim 12 of the patent. It provided an alternative and equivalent hygroscopicity test to the two‑week test. The advantage was that this test was more expedited so Otsuka could check quickly, during the manufacturing process, whether the process was going stably and whether the product had any problems with hygroscopicity. The test provided a distinct advantage in that it enabled Otsuka to ascertain within 24 hours whether the aripiprazole it had manufactured would have low hygroscopicity under the two‑week test.
At the time that this test was devised, Otsuka was using Route II to manufacture aripiprazole. Otsuka found, applying this new test, that the Route II process produced aripiprazole that had low hygroscopicity.
Mr Aoki gave evidence that, at or around the time of publication of the Aoki article and the Aoki poster, he had not tested the hygroscopicity of the type 1 crystals referred to in the article and the poster using the new test. However, shortly before Japanese Patent Application No. 2001-290645 was filed (on 25 September 2001), he conducted such testing on those crystals. The method he used to prepare those crystals and the results he obtained on testing them are reported as Reference Example 2 in the complete specification. The results show that these crystals did not exhibit low hygroscopicity.
From September 1996 onwards, Otsuka performed additional work on how to manufacture aripiprazole in the form of Crystals B consistently on an industrial scale. These investigations were completed prior to finalising the filing of the Japanese equivalent of the patent. This work included the following:
·In 1997, Otsuka made its first manufacturing run of Crystals B on an industrial scale.
·In January 1998, it made a second manufacturing run of Crystals B on an industrial scale.
·In 1998, during a manufacturing run of Crystals B on an industrial scale, Otsuka discovered the presence of Type III Crystals (referred to in the complete specification as Crystals C) within the manufactured product.
·In 1999, it was confirmed that the presence of Crystals C was caused by over‑grinding.
·In 1999, during the manufacturing of Crystals B on an industrial scale, Otsuka discovered the presence of Type IV Crystals (referred to in the complete specification as Crystals D) within the manufactured product.
·In July 2000, Otsuka found that this could be controlled by additional drying at 120°C for two hours.
A number of Otsuka’s confidential internal documents relating to its investigations were tendered and Mr Aoki was cross-examined on these documents. It is not necessary to set out the detail of this evidence. The internal documents reveal that Otsuka faced a number of other challenges in relation to the production of aripiprazole and carried out other investigations. These facts are not directly relevant, however, to the issues raised in this proceeding.
POLYMORPHISM AND HYGROSCOPICITY
An important aspect of Apotex’s case is its contention that hygroscopicity is an inherent property of a given crystalline form of a given compound. Apotex contended that a given crystalline form of aripiprazole will have, inevitably, a given hygroscopicity so that the disclosure of a particular crystalline form of aripiprazole will also inevitably disclose certain of the physicochemical properties of that form, including its hygroscopicity. More specifically, Apotex contended that, if anhydrous aripiprazole crystals have an XRPD spectrum that is substantially the same as the XRPD spectrum shown in Figure 5 of the complete specification, those crystals will inevitably have low hygroscopicity, namely, a moisture content of 0.40% or less after being placed for 24 hours in a closed container maintained at a temperature of 60°C and a humidity level of 100%.
In this connection, Apotex relied on, among other things, a finding made by me when dealing with Otsuka’s earlier application to amend the patent. In the amendment reasons at [17], I said:
[17] For present purposes I am satisfied on the evidence that a person skilled in organic chemistry in 2002 would have understood, on reading the specification as filed, that properties (7)–(11) are the essential physicochemical properties that define the crystalline form of Crystals B.
The properties designated as (7) to (11) in that quotation are the characteristics identified in the same way in the passage from the complete specification quoted in [54] above. That finding was based on the evidence then before me which was, relevantly, Professor Easton’s first affidavit, which was also read at the present hearing. I did not have, at that time, the benefit of the far greater body of evidence now before me (including further evidence from Professor Easton), which I will now discuss. Before doing so, I should state that, had I had the benefit of the present evidence when dealing with the amendment application, I would have expressed myself differently when making my finding about what the person skilled in the art would have understood to be the physicochemical characteristics of Crystals B when reading the complete specification. That would not, however, have led me to reach any different conclusion on the fate of the amendment application.
Dr Rowe, who was called by Apotex, gave evidence in his first affidavit that, if the XRPD analysis indicates that a compound is in a particular crystalline form, then the compound will have the physicochemical properties of that particular crystalline form. He said that, if a sample of aripiprazole is determined by XRPD to be Crystals B, then it would have certain physicochemical properties, namely, the characteristics by which Crystals B are defined in claim 12 of the patent, including the low hygroscopicity characteristic to which I have referred. It appears that Apotex’s contention that hygroscopicity is an inherent property of a given crystalline form of a given compound is derived from Dr Rowe’s evidence.
Dr Rowe later qualified this evidence in light of certain observations made by Professor Withers in an affidavit that was read in the applicants’ case.
Professor Withers gave evidence that the hygroscopicity of a sample of crystals cannot be determined by the XRPD pattern of those crystals alone. He said:
83.[The applicants’ solicitors] asked me whether I am able to comment on the hygroscopicity of a sample based on its XRPD pattern alone. The answer is no. The hygroscopicity of a crystal needs to be determined experimentally. It can arise from (i) the absorption of water from the surrounding atmosphere into its crystal structure in a regularly repeating manner to form a hydrate, and/or (ii) the adsorption of water onto the surface of the crystal. In the former case, the measured hygroscopicity will be relatively high and the XRPD pattern of the hydrate will differ from that of the initial sample. In the latter case, the measured hygroscopicity will be relatively low and the XRPD patterns before and after adsorption will not differ. XRPD provides a fingerprint of the internal crystalline form, but not of its surface properties.
84.It is possible for two crystal samples to have the same XRPD patterns but different surface properties such that the hygroscopicity of those samples is different. Hygroscopicity is determined by, amongst other things, the surface properties, for example the particle size, of a crystal.
85.If I were to compare the XRPD patterns of two samples and consider that they were the same, or substantially the same, I would conclude that the two samples were of the same crystalline form. I would not be able to conclude that those two samples necessarily have the same hygroscopicity.
As I have noted, Professor Withers was not cross-examined.
When Dr Rowe responded to these statements in his second affidavit, he accepted that XRPD data alone does not confirm the hygroscopicity of a sample. He said, however, that, if the hygroscopicity of a crystalline form identified by XRPD analysis is known, the “inherent hygroscopicity” of the sample will be the same. This statement was itself qualified by Dr Rowe’s acceptance that particle size can affect the amount of water a sample adsorbs, because the surface area of a particle can vary with particle size. In this connection, Dr Rowe said:
10. Professor Withers says … that the hygroscopicity of a crystal sample is determined by surface properties including the particle size, of a crystal. I agree that particle size can affect the amount of water a sample adsorbs because the surface area of a particle can vary with particle size … However, the water content of crystalline samples of the same compound, in the same crystalline form and with the same surface area will be the same (assuming they are exposed to the same environmental conditions), as hygroscopicity is an inherent property of the crystalline form. Smaller particles generally have greater surface area than larger particles, and this can mean that more water will be adsorbed … to the surface of the smaller particle than a larger particle. In my experience, the variation in adsorbed water content resulting from different particle sizes is usually very minor in samples of pharmaceutical material (particularly as samples are normally comprised of particles with a range of different surface areas). Surface area may also affect the rate of conversion of a hygroscopic compound that is susceptible to conversion to a hydrate, or is deliquescent …
In his first affidavit, Professor Easton said that XRPD, TGA/DTA, DSC, adsorption bands on the IR (KBr) spectrum, and hygroscopicity measurements afford information that is “characteristic of a particular crystal form”. When referring to the claims of the patent before amendment, Professor Easton said:
4.13 Upon reading the [patent] and its claims, I understood the claims relating in particular to Anhydrous Aripiprazole Crystals B to cover the crystal form with the Characteristics set out on pages 23 to 24 of the [patent] and, to the extent that any of the claims of the [patent] repeated one of the Characteristics, I considered that repetition to be redundant. That is, I did not see any differences in what is claimed between, for example, claim 12 of the Amended Claims and unamended claims 14, 16, 17 and 18 of the [patent]. Further, to the extent that the claims of the [patent] introduced any additional characteristics not covered by the Characteristics set out on pages 23 to 24, I considered the relevant claims to be narrower in scope and to cover a crystal form with more narrowly defined characteristics than the Characteristics set out on pages 23 to 24 of the [patent]. For example, claim 13 of the [patent] specifies a further reduced moisture content of 0.10% or less, which is narrower than the 0.4% figure set out on page 24 of the [patent].
In his second affidavit, when referring to the properties of polymorphs of the same chemical compound, Professor Easton also accepted that the form of the material affects various of its properties, including its hygroscopicity. He said, however, that hygroscopicity is also determined by characteristics such as crystal size and surface area.
In cross-examination, he also suggested that, when a crystal structure takes up water, there may be a relationship between adsorption and absorption: when a material converts from an anhydrous form to a hydrate, it generally goes through an adsorption phase first, which will be affected by the smoothness of the crystal surface, including whether there are fractures in it. He said that there has to be a localised restructuring to convert the anhydrous form to the hydrous form, “which basically involves one [disassembling] and then another one re-assembling”.
Professor Prestidge also gave evidence on this subject. When asked in cross‑examination whether the degree of hygroscopicity of a polymorph under given constant conditions is a property of that polymorph, Professor Prestidge said that the moisture uptake of the polymorph can be a “surface phenomenon” (that is, the adsorption of moisture on the surface of the crystals) or a “bulk phenomenon” (that is, the absorption of moisture into the bulk of the crystals). He also said that there may be factors other than polymorphic form that can influence the moisture uptake of a crystal. He said that, if there are changes in particle size and surface area in two samples of the same polymorph, the samples may have different levels of moisture uptake. Professor Prestidge agreed, however, that two samples of the same polymorph with the same surface properties and the same bulk properties should have the same moisture uptake.
Importantly, however, he gave this evidence:
… [P]olymorphic form is one of the factors that determines hygroscopicity, would you agree?---One of the factors, yes. Yes.
And if I keep surface area constant in the way you’ve just described it, a given polymorph will have a given hygroscopicity?---There are subtleties in this field, because you have a bulk crystal and the surface chemistry can be subtly different. So the techniques we use here to characterise the polymorphic form, as in the infrared spectroscopy and the XRPD, they measure bulk properties. Moisture uptake can be controlled by a surface phenomenon which is a little bit more subtle in some ways …
He explained that there may be a number of physical phenomena that can influence the capacity of a substance to adsorb moisture. When asked about how the surface properties of a polymorph might be affected by the way in which the polymorph is produced, Professor Prestidge said:
… [T]he way in which a polymorph is formed controls the bulk properties as measured by the various crystal structures, but other phenomenon, for instance, grinding or other physical thermal properties, may change - the molecules that are at the absolute surface of a crystal are different from those in the bulk. So there is - there are a number of physical properties - physical phenomenon that may influence that.
He also gave this evidence:
If an anhydrous form converts to a hydrated [form], and that’s the process where we get absorption of water, that’s likely to be quite a substantial moisture uptake. In terms of percentages, I think we’re talking a number of percentages, so it’s - so for instance, we go from a monohydrate, each molecule of the drug will absorb one molecule of water, so you can do a calculation there of what the [likely] uptake is. With respect to adsorption, the physical effect, that depends on the particle size. If you’ve got materials of this sort of - this sort of particle size, in the 10s of microns, it’s likely to be lower values. So the amount of moisture uptake on the adsorption onto these sized particles is likely to be a fraction of a per cent.
When dealing with the surface properties of a particle other than its surface area, Professor Prestidge said:
And what other surface properties do you have in mind other than surface area?---It’s around the molecule - if the molecule is orientated slightly differently at different crystal faces, that can play a role. You can have the same polymorph - so, yes, literally, it’s around subtle molecular structural changes that can occur at the surfaces of crystals which may play a role.
Because of a lack of data, Professor Prestidge was unable to express a view concerning the percentage of water uptake that might be caused by such changes.
The evidence of these witnesses shows that the hygroscopicity of a crystalline compound is not just a function of its crystalline form, but may be influenced by particle size and, in subtle ways, by the surface properties of the polymorph in question. Professor Prestidge’s evidence suggests that, as a general statement, water uptake by adsorption is likely to be significantly less than water uptake by absorption, when the particle size is in the tens of microns, such as the crystals claimed in claim 16. Even so, I do not think that the possible influence of these factors can simply be ignored.
In submissions, Apotex placed considerable reliance on Otsuka’s internal memoranda and experimental reports to advance explanations of why conventional anhydrous aripiprazole crystals, such as type 1 crystals and type 2 crystals, exhibit the hygroscopicity problem described in the complete specification. Apotex submitted that this material shows that the cause of the problem was not an inherent property of type 1 crystals that is not also possessed by Crystals B.
My own reading and analysis of these documents, assisted by Mr Aoki’s cross‑examination on them, does not persuade me that, at the time the patent was applied for, Otsuka itself had any definite understanding of why conventional anhydrous aripiprazole crystals were “significantly hygroscopic”. It gave consideration to multiple possible causes for the problem. Its consideration was based, in part, on the empirical work it had undertaken and was continuing to undertake to gain a greater understanding of the physicochemical properties of crystalline aripiprazole. Its research, carried out over an extended period of time, ultimately led it to conclude that, by undertaking certain processing steps, it was possible to achieve crystalline aripiprazole that exhibited low hygroscopicity in terms of the moisture content described in the complete specification as being one of the essential characteristics of Crystals B.
For reasons that I will later explain, I am satisfied on the balance of probabilities that Crystals B and type 1 crystals have the same crystalline form. However, if that is the case, Otsuka’s experimental work shows that the hygroscopicity of a given crystalline form of aripiprazole, under certain storage criteria, will vary depending on whether the aripiprazole in that crystalline form is subjected to certain processing steps, such as those with which Mr Aoki was involved, including heating at certain temperatures. The complete specification reveals that type 1 crystals do not have the same hygroscopicity as Crystals B under certain conditions unless the type 1 crystals undergo heating at specific temperatures. I do not accept, therefore, that a given crystalline form of aripiprazole will have, inevitably, a given hygroscopicity. It follows that I do not accept that the disclosure of a particular crystalline form of anhydrous aripiprazole will also inevitably disclose its hygroscopicity in that form.

Clause 5.4.1 of the Agreement contains the grant of an “exclusive license” that is subject to reservations. The “exclusive license” is stated to be:
… under the Patent Rights and Otsuka’s related know-how, data and information, to make and have made (subject to Section 5.4.3(c)), use and sell Product, under [certain trade marks], and to formulate [aripiprazole] into Bulk Tablets and other Product, in the Field in the Rest of Territory. For the sake of clarification … the Field for Product containing a Related Compound is limited to Neuroscience Indications. …
It is not necessary to set out all the defined terms. It is only necessary to discuss the term “Patent Rights”. This term is defined by reference to certain listed patents, which do not include the patent. However, the meaning of the term is extended to:
… all other patents and patent applications (and patents issuing from such applications) that become owned, solely or jointly, by Otsuka … which generically or specifically relate to [aripiprazole] …
The reservations exclude from the licence the right to manufacture aripiprazole in its various forms: clause 5.4.1(a). Somewhat redundantly, clause 5.4.3(c) provides:
Notwithstanding the provisions of Sections 5.4.1 and 5.4.2, Otsuka reserves the exclusive worldwide right, for itself … to manufacture, or have manufactured [aripiprazole in its various forms] …
The point of present significance is that the licence granted under the Agreement to BMS does not include the right to manufacture aripiprazole under one of Otsuka’s patents. There are other reservations and exclusions, but these do not concern the patent or the exercise of rights in the patent area.
In oral submissions, Apotex pointed to two matters which, it argued, signified that the Agreement did not confer on BMS an exclusive licence with respect to the patent. The first matter is that, whereas the right to “make” is one of the stipulated activities falling within the meaning of “exploit” as defined for the purposes of the Act, BMS does not have a licence to manufacture aripiprazole in its various forms. Apotex argued that the exclusion of this right from the licence, and its correlative reservation to Otsuka, necessarily meant that the Agreement does not confer an exclusive licence within the meaning of the Act. The second matter is that, according to Apotex, it is not clear on the face of the Agreement that the rights it does confer on BMS are exclusive of Otsuka’s own rights to engage in the same activities with respect to aripiprazole. In short, Apotex argued that it is not clear that exclusive, as opposed to sole, rights are conferred by the Agreement.
The first matter raises a difficult question of statutory construction.
The Patents Act 1952 (Cth) (the 1952 Act) recognised the rights of an exclusive licensee. Section 6 of the 1952 Act defined the expression “exclusive licensee” as follows:
… a licensee under a licence granted by the patentee which confers on the licensee, or on the licensee and persons authorized by him, the right to make, use, exercise and vend the patented invention, throughout Australia, to the exclusion of all other persons, including the patentee…
This definition was discussed by the High Court in Ex parte British Nylon Spinners Limited and Imperial Chemical Industries Limited; In re Imperial Chemical Industries Limited’s Patent (1963) 109 CLR 336. In that case, the applicants applied to extend the term of a patent relating to an improved process for melt-spinning Nylon yarn. The right to apply for an extension of term was conferred by the 1952 Act on the patentee who, by dint of s 96, was taken to include “an exclusive licensee”. The patentee in that case had granted British Nylon Spinners Limited (BNS) what was called an exclusive licence to make, use, exercise, and vend the invention within a certain limited field (namely, yarn of which the filament, or any of the filaments, do not exceed 0.09 mm in its largest cross-sectional dimension in the drawn condition). The patentee later granted Imperial Chemical Industries Limited (ICI) a licence under the patent which was expressed to “be subject to the B.N.S. licence but otherwise exclusive”. Both BNS and ICI claimed to be entitled to apply to extend the term of the process patent. They argued that each licence, within its limited field, conferred a right to make, use, exercise, and vend the patented invention throughout Australia “to the exclusion of all other persons, including the patentee”.
The High Court emphatically rejected that argument, branding it “fallacious in the extreme”. The High Court said (at 340):
In approaching this question it is to be observed that any number of licences may be granted conferring a right to make use exercise and vend a patented invention. Perhaps it may be said that any number of licences may be granted conferring the right to make use exercise and vend a patented invention. But the introduction of the definite article into the definition suggests that the right must be found in a single licensee for it is the right to make use exercise and vend the patented invention which the licence must be found to confer. However this may be, the concluding words of the definition make it clear beyond doubt that the licence must confer that right to the exclusion of all other persons including the patentee. One of several licences which confer upon each of the respective licensees a right to make use exercise and vend a patented invention within a series of limited fields does not, therefore, constitute an exclusive licence. It may be true to say that each of such licensees has the exclusive right within his limited field to make use exercise and vend the patented invention but this is far from saying that each has the right to make use exercise and vend the patented invention throughout Australia to the exclusion of each other.
In dealing with that question, the High Court observed that s 101 of the Patents Act 1949 (UK) contained a definition of “exclusive licensee” that was substantially different to that used in the 1952 Act. The definition in the UK Act recognised as an exclusive licensee a licensee of any right in respect of the patented invention that was to the exclusion of all other persons, including the patentee. It had been held that that definition permitted “a plurality of exclusive licensees to be created in respect of any one patent monopoly”: In the Matter of Courtaulds Ld.’s Application for Extension of the Term of Letters Patent No. 511,160 [1956] RPC 208 at 210. Plainly, by drawing attention to that decision, the High Court was distinguishing the position under the 1952 Act, where there could be only one exclusive licensee, not a multiplicity of such licensees.
In Uprising Dragon Ltd and Another v Benedict Trading & Shipping Pty Ltd and Others (1987) 16 FCR 93 at 102, French J (when in this Court) saw British Nylon Spinners as deciding that an exclusive licence limited to a particular field will not amount to an exclusive licence for the purposes of s 6 of the 1952 Act.
The meaning of “exclusive licensee” in the Act arose for consideration by the Supreme Court of Queensland in Grant and Another v Australian Temporary Fencing Pty Ltd (2003) 59 IPR 170. In that case, the defendant, who had been sued for patent infringement, challenged an assignment to the first plaintiff of a patent (for portable fencing used in roadworks) and the consequent grant by the first plaintiff of an exclusive licence of the patent to the second plaintiff. The defendant challenged the existence of an exclusive licence on a number of bases, including that the licence conferred no right to import the patented product, only the right to use it. It was argued that, as the licence did not grant all the rights specified in the Act as constituting the “right to exploit”, there was no grant of an exclusive licence. This argument was rejected by Holmes J. After noting the terms of s 6 of the 1952 Act, her Honour (at [41]) said:
[41] It can be seen that the definition in the 1952 Act is exhaustive, and the rights cumulative: making, using, exercising and vending. That is in contrast with the non‑exhaustive definition of “exclusive licensee” under the present legislation, which merely refers to a “right to exploit” and then separately defines “exploit” in an inclusive and distributive way: “make, hire, sell or otherwise dispose … use or import …” (emphasis added). The latter definition is at least open to a construction similar to that given [to] s 101 of the English Patents Act of 1949, as discussed in Ex Parte British Nylon Spinners Ltd and Imperial Chemical Industries Ltd: that because the definition of exclusive licence in that provision referred to a licence conferring “any right in respect of the patented invention” the way was open for a “plurality of exclusive licences”. But more importantly for present purposes, it makes no sense to say that the rights explicitly conferred by a licence must, in order to be exclusive, be an exhaustive list of what is comprised in the right to exploit in the legislation, when the legislation itself is not exhaustive in its definition of the term. Consequently, I reject the argument that the failure to include a right to import (which neither party may have contemplated exercising, before or after the grant of licence) is fatal to exclusivity.
[Footnotes omitted]
In Pharmacia Italia SpA and Another v Interpharma Pty Ltd (2005) 67 IPR 397, Sundberg J, when dealing with an application for an interlocutory injunction for patent infringement, referred to the decision in Grant. At [21], his Honour observed that the argument that a licence could not be an exclusive licence if it did not confer the right to import was rightly rejected.
The applicants contended that I should follow Grant and Interpharma with respect to the meaning of “exclusive licensee” as used in the Act. They submitted that the licence conferred by the Agreement should not be denied the status of an exclusive licence simply because it does not confer on BMS the right to manufacture aripiprazole.
I am, with respect, unable to agree with the reasoning and conclusion in Grant.
Section 13(1) of the Act provides that a patent gives the patentee the exclusive rights to exploit the invention (which can only mean the invention as claimed) and to authorise another person to exploit the invention. The definition of “exclusive licensee” recognises these twin rights. The licence referred to in the definition might confer on the licensee the patentee’s exclusive right to exploit the patented invention throughout the patent area. Alternatively, the licence might confer that right on the licensee and persons authorised by the licensee. In either case, the legal effect of the licence must be that “the patentee and all other persons” are excluded from exercising the right to exploit the patent. It follows that the legal effect of the licence must also be to exclude the patentee from exercising the exclusive right under s 13(1) of the Act to authorise another person to exploit the invention.
In this way, it can be seen that the definition of “exclusive licensee” operates in harmony with the rights conferred by the Act on the patentee. The licence under which the licensee derives the status of “exclusive” licensee is one that excludes the patentee, and others deriving authority from the patentee, from exercising the rights conferred by the patent with respect to the invention during the term of the licence. An exclusive licence cannot be one that reserves to the patentee or any other person any residual right with respect to the exploitation of the invention. It follows that there can only be one exclusive licensee.
In my view, the Act speaks of “the right to exploit” the invention as a single, indivisible right. The word “exploit” is used in the Act as a hypernym to cover a range of activities. The inclusive nature of the definition employed by the Act, and the exemplification of particular activities to elucidate the meaning of the word, signify that a broad range of activities is intended to be covered. However, s 13(1) of the Act recognises that only two rights are conferred by the patent: the right to exploit the invention and the right to authorise others to exploit the invention. The use of disjunctive language in the definition of “exploit” to identify particular activities falling within the scope of the term does not create separate rights with respect to those activities. It merely recognises that the right to exploit covers a range of activities, any one of which, if undertaken, would amount to the exercise of the right to exploit.
Support for this view is provided by the provisions in the Act respecting assignment. Section 13(2) of the Act recognises that the exclusive right to exploit an invention, as an incident of the grant of a patent for that invention, is personal property that is capable of assignment and of devolution by law. Section 14(2) of the Act recognises that a patent may be assigned for a place in, or part of, the patent area. There is no recognition, however, that a patent might be assigned as to some incident of the right to exploit the invention.
This reasoning reflects, in my respectful view, the essential reasoning of the High Court in British Nylon Spinners with respect to the meaning of “exclusive licensee” in s 6 of the 1952 Act: the patentee has conferred on the licensee, exclusively, the exercise of the rights that the patentee itself has been granted under the patent. I am unable to see how, in determining the meaning of “exclusive licensee” in the present Act, this reasoning can be avoided by distinguishing the definition of the word “exploit” from the words “make, use, exercise and vend” in the corresponding definition of “exclusive licensee” in the 1952 Act. There are plainly differences between the two definitions in language and structure, including that the definition under the 1952 Act is exhaustive whereas the definition under the Act is merely inclusive. But, in my respectful view, these differences do not have the significance attributed to them in Grant. Regardless of possible differences in scope between “exploit” under the Act and “make, use, exercise and vend” under the 1952 Act, the definition of “exclusive licensee” in each Act refers to the conferral by the patentee of a single licence that precludes the patentee, and any person deriving authority from the patentee, from exercising the rights granted by the patent.
Given that the Agreement excludes from the licence granted to BMS the right to manufacture aripiprazole (including in the form of Crystals B), and reserves that right to Otsuka, I do not accept that BMS is an exclusive licensee of the patent with title to sue Apotex for infringement.
In these circumstances, it is unnecessary for me to decide whether the Agreement confers exclusive rights or merely sole rights on BMS. Nevertheless, appreciating that a different view might be taken on the question I have decidedly adversely to BMS, I should state that, in respect of the rights in the Agreement that are expressed to be granted to BMS exclusively, there is nothing that indicates to me that only sole rights were intended to be granted.
MISCELLANEOUS RULINGS ON EVIDENCE
During the hearing, I made a small number of provisional rulings on evidence. The parties were content for me to provide final rulings in the course of providing these reasons.
Paragraph 39 of Dr Rowe’s first affidavit and certain recorded conversations in paragraphs 176 and 177 of Associate Professor McGeary’s first affidavit were admitted, subject to relevance. I am satisfied that paragraph 39 of Dr Rowe’s first affidavit is relevant. The recorded conversations in paragraphs 176 and 177 of Associate Professor McGeary’s first affidavit seem to me to be of marginal relevance. I do not think, however, that those conversations stand apart from other parts of the affidavit with which they are associated and to which no objection on relevance (or, indeed, any objection) has been made. I will admit this evidence unconditionally.
DISPOSITION
The parties are to bring in draft orders reflecting these reasons. For the assistance of the parties, I should indicate my provisional view that, while injunctive relief is appropriate, declaratory relief in relation to infringement does not seem to be necessary or otherwise appropriate.
I also note that an injunction is sought whose effect would be to require Apotex to withdraw its application to obtain listing of the Apotex products under the pharmaceutical benefits scheme maintained by the Commonwealth under the National Health Act 1953 (Cth). If that relief is to be pursued, and is opposed, I would wish to hear the parties further on that question. I have already indicated that I wish to hear the parties further on the infringement of claim 14, if that aspect of infringement is to be pursued.
In the event that the parties are unable to agree on proposed orders to be made at the present time, written submissions, not to exceed three pages, should be provided to support the orders that each party contends should be made. I will then deal with the matter on the papers, unless I am persuaded that oral argument is required.
Before publication of these reasons to the parties, and more generally, I will allow the parties’ external legal representatives a short period of time within which to consider whether these reasons include information in respect of which any remaining claim for confidentiality is made.

I certify that the preceding four hundred and forty-six (446) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Yates.
Associate:
Dated: 30 October 2013
SCHEDULE A

13 Anhydrous Aripiprazole Crystals B according to claim 12, wherein said low hygroscopicity is a moisture content of 0.10% or less after placing said drug substance for 24 hours in a closed container maintained at a temperature of 60°C and a humidity level of 100%.

14 Anhydrous Aripiprazole Crystals B according to claim 12, having a powder x‑ray diffraction spectrum having characteristic peaks at 20 = 11.0°, 16.6°, 19.3°, 20.3° and 22.1°.

16 Anhydrous Aripiprazole Crystals B according to claim 12, wherein said crystals have a mean particle size of 50 µm or less.

30 The Anhydrous Aripiprazole Crystals B according to any one of claims 12 to 17 formulated with one or more pharmaceutically acceptable carriers.

31 The Anhydrous Aripiprazole Crystals B according to claim 30 formulated with one or more pharmaceutically acceptable carriers to form a solid oral tablet.

35 The use of Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 for the treatment of a central nervous system disorder.

36 The use of Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 for the treatment of schizophrenia.

43 The use of Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 to prepare a medicament to treat or prevent schizophrenia and the symptoms associated with schizophrenia.

44 A drug when used for treating schizophrenia or symptoms associated with schizophrenia, which comprises Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 in an amount effective to treat schizophrenia or the symptoms thereof, in admixture with a pharmaceutically acceptable diluent.

45 The drug as claimed in claim 44, which is contained in a commercial package carrying instructions that the drug should be used for treating schizophrenia, or symptoms thereof.

111 A method of treating a central nervous system disorder comprising administering Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19.

112 A method of treating schizophrenia comprising administering Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19.

119 A method of treating or preventing schizophrenia and symptoms associated with schizophrenia comprising administering Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19.

123 Use according to any one of claims 35-43, substantially as hereinbefore described.

Citation:	Bristol-Myers Squibb Company v Apotex Pty Ltd (No 5) [2013] FCA 1114
Parties:	BRISTOL-MYERS SQUIBB COMPANY and OTSUKA PHARMACEUTICAL CO., LTD v APOTEX PTY LTD (ACN 096 916 148)
File number:	NSD 1116 of 2009
Judge:	YATES J
Date of judgment:	30 October 2013
Catchwords:	PATENTS – standard patent for improved form of anhydrous aripiprazole crystals having low hygroscopicity (Crystals B) – whether hygroscopicity is inherent property of given crystalline form of aripiprazole – whether disclosure of particular crystalline form of aripiprazole discloses its physicochemical properties including its hygroscopicity PATENTS – validity – novelty – inevitable result – whether person skilled in the art carrying out directions in prior art patent specification before priority date would inevitably have obtained anhydrous aripiprazole crystals having the characteristic low hygroscopicity of Crystals B – whether directions in prior art patent specification disclose the invention as claimed PATENTS – validity – novelty – whether disclosure of crystalline form of Crystals B in prior art publications discloses the invention as claimed – whether prior art publications should be treated as single source of information PATENTS – validity – false suggestion or misrepresentation – statements in complete specification and correspondence in course of prosecuting application for patent PATENTS – validity – inventive step – problem‑solution approach – whether person skilled in the art would be directly led as a matter of course to take steps that would lead to the invention as claimed PATENTS – validity – manner of manufacture – whether working interrelationship between drug comprising Crystals B and commercial package carrying instructions for drug to be used to treat schizophrenia or its symptoms PATENTS – validity – clarity – whether requirement that compound exhibits a particular endothermic peak is unclear for failure to specify whether one or more other endothermic peaks may also be present on analysis – whether requirement of mean particle size unclear for failure of claim to expressly stipulate a particular method of measuring mean particle size or range of particle sizes in a given sample PATENTS – validity – fair basis – whether real and reasonably clear disclosure of Crystals B having certain particle size as part of invention PATENTS – infringement – threatened infringement –contributory infringement – authorisation PATENTS – standing to sue for infringement – whether first applicant is exclusive licensee of patent – right to manufacture aripiprazole under patent not conferred on licensee – consideration of meaning of “exclusive licensee”
Legislation:	Copyright Act 1968 (Cth) s 101(1A) National Health Act 1953 (Cth) Patents Act 1949 (UK) s 101 Patents Act 1952 (Cth) ss 6, 96 Patents Act 1990 (Cth) ss 7, 13, 14, 18, 40, 117, 120(1), 138(3)
Cases cited:	Aktiebolaget Hässle and Another v Alphapharm Pty Limited (2002) 212 CLR 411 Alphapharm Pty Ltd (ACN 002 359 739) v H Lundbeck A/S and Another (2008) 76 IPR 618 Apotex Pty Ltd (ACN 096 916 148) v Sanofi‑Aventis and Others (2009) 82 IPR 416 Apotex Pty Ltd v AstraZeneca AB and Another (No 4) (2013) 100 IPR 285 Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd and Others (No 2) (2012) 204 FCR 494 Bristol‑Myers Squibb Company v F H Faulding & Co Limited (2000) 97 FCR 524 Evans Medical Ltd’s Patent [1998] RPC 517 Ex parte British Nylon Spinners Limited and Imperial Chemical Industries Limited; In re Imperial Chemical Industries Limited’s Patent (1963) 109 CLR 336 Grant and Another v Australian Temporary Fencing Pty Ltd (2003) 59 IPR 170 In the Matter of Courtaulds Ld.’s Application for Extension of the Term of Letters Patent No. 511,160 [1956] RPC 208 Lockwood Security Products Pty Ltd v Doric Products Pty Ltd [No 2] (2007) 235 CLR 173 Pharmacia Italia SpA and Another v Interpharma Pty Ltd (2005) 67 IPR 397 Prestige Group (Australia) Pty Ltd v Dart Industries Inc (1990) 26 FCR 197 Sanofi-Aventis Australia Pty Ltd and Others v Apotex Pty Ltd (No 3) (2011) 196 FCR 1 Sigma Pharmaceuticals (Australia) Pty Ltd v Wyeth and Another (2010) 88 IPR 459 Smith & Nephew Pty Ltd (ACN 000 087 507) v Wake Forest University Health Sciences and Another (2009) 82 IPR 467 TheGeneral Tire & Rubber Company v. The Firestone Tyre and Rubber Company Limited and Others [1972] RPC 457 The University of New South Wales v Moorhouse and Another (1975) 133 CLR 1 The Wellcome Foundation Limited v V.R. Laboratories (Aust.) Proprietary Limited (1981) 148 CLR 262 Uprising Dragon Ltd and Another v Benedict Trading & Shipping Pty Ltd and Others (1987) 16 FCR 93 Vehicle Monitoring Systems Pty Ltd (ACN 107 396 136) v Sarb Management Group Pty Ltd (t/as Database Consultants Australia) (ACN 106 549 722) (No 2) (2013) 101 IPR 496 Wake Forest University Health Sciences and Others v Smith & Nephew Pty Ltd (ACN 000 087 507) and Others (No 2) (2011) 92 IPR 496

Date of hearing:	10, 11, 12, 13, 14, 17, 18, 19, 20, 21 December 2012
Place:	Sydney
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	446
Counsel for the Applicants:	Mr AJL Bannon SC with Ms CL Cochrane
Solicitor for the Applicants:	Allens
Counsel for the Respondent:	Mr DK Catterns QC with Mr NR Murray
Solicitor for the Respondent:	Herbert Smith Freehills

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 1116 of 2009

JUDGE:	YATES J
DATE OF ORDER:	30 OCTOBER 2013
WHERE MADE:	SYDNEY

JUDGE:	YATES J
DATE:	30 OCTOBER 2013
PLACE:	SYDNEY

Introduction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[1]
Relevant scientific concepts........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[7]
Crystalline compounds........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..	[8]
Polymorphism........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[11]
Hydrates and solvates........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...	[15]
Amorphous forms........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[17]
Analytical methods........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[19]
NMR spectroscopy........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...	[19]
Powder x-ray diffraction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..	[22]
Infrared spectroscopy........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[28]
Differential scanning calorimetry........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[30]
Thermogravimetric/differential thermal analysis........ ........ ........ ........ ........ ........ .......	[34]
The witnesses........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[37]
The patent........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[40]
The development of the claimed invention........ ........ ........ ........ ........ ........ ........ ........ .......	[73]
Polymorphism and hygroscopicity........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[89]
The prior art........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[120]
The 141 application........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[121]
The Aoki article........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .....	[127]
The Aoki poster........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .....	[137]
Validity: novelty........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[139]
The 141 application........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[143]
Introduction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[143]
The McGeary protocol........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ......	[145]
Other evidence concerning the McGeary protocol........ ........ ........ ........ ........ ........ ...	[157]
The McGeary experiment........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..	[172]
Other evidence concerning the McGeary experiment........ ........ ........ ........ ........ .......	[182]
The White protocol........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...	[202]
Other evidence concerning the White protocol........ ........ ........ ........ ........ ........ ........	[209]
The White experiment........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[216]
Other evidence concerning the White experiment........ ........ ........ ........ ........ ........ ....	[231]
Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[244]
The Aoki article and the Aoki poster........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[280]
Validity: false suggestion........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .	[297]
Validity: inventive step........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[317]
Validity: manner of manufacture........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .....	[359]
Validity: clarity........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........	[369]
Validity: fair basis........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[387]
Infringement ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....	[393]
Exclusive licence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[413]
Miscellaneous rulings on evidence ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...	[441]
Disposition ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .......	[443]

13	Anhydrous Aripiprazole Crystals B according to claim 12, wherein said low hygroscopicity is a moisture content of 0.10% or less after placing said drug substance for 24 hours in a closed container maintained at a temperature of 60°C and a humidity level of 100%.
14	Anhydrous Aripiprazole Crystals B according to claim 12, having a powder x‑ray diffraction spectrum having characteristic peaks at 20 = 11.0°, 16.6°, 19.3°, 20.3° and 22.1°.
16	Anhydrous Aripiprazole Crystals B according to claim 12, wherein said crystals have a mean particle size of 50 µm or less.
30	The Anhydrous Aripiprazole Crystals B according to any one of claims 12 to 17 formulated with one or more pharmaceutically acceptable carriers.
31	The Anhydrous Aripiprazole Crystals B according to claim 30 formulated with one or more pharmaceutically acceptable carriers to form a solid oral tablet.
35	The use of Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 for the treatment of a central nervous system disorder.
36	The use of Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 for the treatment of schizophrenia.
43	The use of Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 to prepare a medicament to treat or prevent schizophrenia and the symptoms associated with schizophrenia.
44	A drug when used for treating schizophrenia or symptoms associated with schizophrenia, which comprises Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19 in an amount effective to treat schizophrenia or the symptoms thereof, in admixture with a pharmaceutically acceptable diluent.
45	The drug as claimed in claim 44, which is contained in a commercial package carrying instructions that the drug should be used for treating schizophrenia, or symptoms thereof.
111	A method of treating a central nervous system disorder comprising administering Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19.
112	A method of treating schizophrenia comprising administering Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19.
119	A method of treating or preventing schizophrenia and symptoms associated with schizophrenia comprising administering Anhydrous Aripiprazole Crystals B defined in any one of claims 12 to 19.
123	Use according to any one of claims 35-43, substantially as hereinbefore described.