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Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft

Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft

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FEDERAL COURT OF AUSTRALIA
Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft [2014] FCAFC 73

Citation: Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft [2014] FCAFC 73

Appeal from: Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd [2013] FCA 226; Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd (No 2) [2013] FCA 279

Parties:
GENERIC HEALTH PTY LTD and LUPIN AUSTRALIA PTY LIMITED v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED

APOTEX PTY LTD v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED

GENERIC HEALTH PTY LTD and LUPIN AUSTRALIA PTY LIMITED v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED

APOTEX PTY LTD v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED

File numbers: NSD 833 of 2013
NSD 921 of 2013
NSD 984 of 2013
NSD 1006 of 2013

Judges: BESANKO, MIDDLETON AND NICHOLAS JJ

Date of judgment: 19 June 2014

Catchwords:
PATENTS – lack of inventive step – whether the invention would be obvious to the hypothetical skilled addressee of the patent at the priority date – whether the hypothetical skilled addressee of the patent would have undertaken the steps in the patent as a matter of routine to lead, as a matter of course, to the invention – whether expectation of hypothetical skilled addressee of the patent in undertaking the steps in the patent is a necessary element of the test of obviousness – whether hypothetical skilled addressee of the patent must have expectation of successful production of the invention or “some other useful result” – whether the reformulated Cripps question is a test of universal application – lack of fair basis – lack of novelty.

PRACTICE AND PROCEDURE – application for leave to appeal against interlocutory decision on admissibility of evidence pursuant to r 34.50 of the Federal Court Rules 2011 (Cth) – whether application made out of time – where application for leave to appeal filed within time to apply for leave to appeal from orders – whether interlocutory decision sufficiently connected with orders such that time began to run on date of orders.

EVIDENCE – admissibility of experimental proof of facts – Federal Court Rules 2011 (Cth) r 34.50 – whether manufacture of tablets to be used in dissolution test experiments the subject of directions pursuant to r 34.50 forms part of the experimental proof of fact – whether manufacture of tablets akin to manufacture of standard products used in the course of an experiment.

Held: Appeal dismissed.

Legislation: Federal Court Rules 2011 (Cth) r 34.50
Patents Act 1990 (Cth) ss 7, 18, 19, 40, 138

Cases cited: Aktiebolaget Hässle and Another v Alphapharm Pty Ltd (2002) 212 CLR 411
Alphapharm Pty Ltd v H Lundbeck A/S and Another (2008) 76 IPR 618
Atlantis Corporation Pty Ltd and Another v Schindler and Others (1997) 39 IPR 29
CCOM Pty Ltd and Another v Jiejing Pty Ltd and Others (1994) 51 FCR 260
Coulton & Others v Holcombe & Others (1986) 162 CLR 1
Decor Corporation Pty Ltd and Another v Dart Industries Inc (1991) 33…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2014] FCAFC 73
Decision Date: 19 June 2014

CaseChat Overview and Summary

In the case of Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft, the primary dispute concerned the patentability of certain pharmaceutical formulations. The Federal Court was tasked with determining whether the alleged invention lacked an inventive step and if it would have been obvious to a hypothetical skilled addressee at the priority date. Additionally, the court considered the admissibility of experimental proof of facts under Federal Court Rules 2011 (Cth) r 34.50, particularly whether the manufacture of tablets for dissolution testing experiments constituted part of the experimental proof of fact. The case also involved an application for leave to appeal against an interlocutory decision on the admissibility of evidence, raising issues regarding the timeliness of the application and the connection between the interlocutory decision and the final orders.

The court addressed several legal issues, including whether the hypothetical skilled addressee of the patent would have undertaken the steps in the patent as a matter of routine, and if so, whether they would have expected to successfully produce the invention or some other useful result. The court also considered whether the expectation of the hypothetical skilled addressee was a necessary element of the obviousness test and whether the test was of universal application. Furthermore, the court examined whether the manufacture of tablets for dissolution testing experiments was akin to the manufacture of standard products used in the course of an experiment, and thus subject to the directions under r 34.50. Lastly, the court deliberated on the timeliness of the application for leave to appeal against the interlocutory decision, considering whether it was made out of time and if the interlocutory decision was sufficiently connected with the final orders.

The court found that the hypothetical skilled addressee would not have undertaken the steps in the patent as a matter of routine, and thus the invention was not obvious. The court concluded that the expectation of the hypothetical skilled addressee was not a necessary element of the obviousness test and that the test was not of universal application. Regarding the admissibility of experimental proof of facts, the court determined that the manufacture of tablets for dissolution testing experiments was not part of the experimental proof of fact, as it did not constitute the manufacture of standard products used in the course of an experiment. The court also found that the application for leave to appeal was made out of time and that the interlocutory decision was not sufficiently connected with the final orders. Consequently, the appeal was dismissed.

The final orders of the court granted leave to appeal in terms of the Amended Draft Notice of Appeal dated "2013", dismissed the appeal, and ordered the appellants to pay the respondents’ costs of the application for leave to appeal and of the appeal. The court also dismissed the Application for an extension of time and leave to appeal dated 4 June 2013 and 7 June 2013, with no order as to costs. Entry of orders was dealt with in Rule 39.32 of the Federal Court Rules 2011.

Orders

Orders of the court

1. Leave to appeal be granted in terms of the Amended Draft Notice of appeal dated “2013”.

2. The appeal be dismissed.

3. The appellants pay the respondents’ costs of the application for leave to appeal and of the appeal.

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

1.Leave to appeal be granted in terms of the Amended Draft Notice of appeal dated “June 2013”.

2. The appeal be dismissed.

3. The appellant pay the respondents’ costs of the application for leave to appeal and of the appeal.

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

1. The Application for an extension of time and leave to appeal dated 4 June 2013 be dismissed.

2. There be no order as to costs.

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

1. The Application for an extension of time and leave to appeal dated 7 June 2013 be dismissed.

2. There be no order as to costs.

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

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Rule 34.50 is in the following terms:34.50 Experimental proof as evidence(1)If a party (the proponent) proposes to tender, as evidence in a proceeding, experimental proof of a fact, the proponent must apply for orders in relation to the experimental proof, including orders about any of the following:(a)the service on other parties of particulars of the experiment and of each fact that the proponent asserts is, will or may be proved by the experiment;(b)any persons who must be permitted to attend the conduct of the experiment;(c)the time when, and the place where, the experiment must be conducted;(d)the means by which the conduct and results of the experiment must be recorded;(e)the time by which any other party (the opponent) must notify the proponent of any grounds on which the opponent will contend that the experiment does not prove a fact that the proponent asserts is, will or may be proved by the experiment.(2)Evidence of the conduct and results of the experiment is admissible in the proceeding, only:(a)if the proponent has complied with subrule (1) and any orders given under that subrule; or(b) with the leave of the Court. The first question is whether the evidence in Mr Burgess’ affidavit is experimental proof of a fact or part of experimental proof of a fact. Mr Burgess was provided with an affidavit of Dr Rowe wherein Dr Rowe had set out his method of preparation of the formulation set out in Example 1 on page 10 of Gast (the alleged anticipation using drospirenone instead of another compound (trimegestone)), and Dr Rowe’s evidence included the process to be followed in the manufacturing of the formulation. Lupin Ltd (Lupin Australia Pty Limited’s parent company) was to manufacture the formulation in accordance with the process and Mr Burgess’ task was to observe the process and confirm whether the specified steps were undertaken. A batch of 6,000 tablets were produced and they were subsequently used in the dissolution testing which was the subject of directions under r 34.50. The purpose of r 34.50 is to ensure the other party has an adequate opportunity to challenge the validity of the experiment or test and to avoid wasteful duplication by that party of an experiment that can be seen to be valid: Lucent Technologies Inc v Krone Aktiengesellschaft (No 2) (1999) 94 FCR 124. In Lexmark, Emmett J said (at 334, [10]):I consider that both categories of procedure are experiments within the meaning of the Rule. An experiment may be defined as follows: “1. The action of trying anything; a test, trial ... 3. An action or operation undertaken in order to discover something unknown, to test a hypothesis, or establish or illustrate some known truth.”‑ New Shorter Oxford English Dictionary. “1. A test or trial; a tentative procedure; an act or operation for the purpose of discovering something unknown or testing a principle.”‑ Macquarie Dictionary. It seems to me that both categories of test referred to by Mr Villanueva fit those definitions.

Decision

Reasons for decision

The matters her Honour took into account were relevant and we do not think that there was a relevant matter which she failed to take into account. There is no basis for interfering with her Honour’s exercise of the discretion.CONCLUSIONS For these reasons, we would grant leave to appeal to the GH parties. However, we would dismiss the appeal. The GH parties must pay the costs of the application for leave to appeal and of the appeal. The Application for an extension of time and leave to appeal by the GH parties should be dismissed with no order as to costs. Similar orders will be made in the proceedings between Apotex and the Bayer parties.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Citation:	Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft [2014] FCAFC 73
Appeal from:	Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd [2013] FCA 226; Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd (No 2) [2013] FCA 279
Parties:	GENERIC HEALTH PTY LTD and LUPIN AUSTRALIA PTY LIMITED v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED APOTEX PTY LTD v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED GENERIC HEALTH PTY LTD and LUPIN AUSTRALIA PTY LIMITED v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED APOTEX PTY LTD v BAYER PHARMA AKTIENGESELLSCHAFT and BAYER AUSTRALIA LIMITED
File numbers:	NSD 833 of 2013 NSD 921 of 2013 NSD 984 of 2013 NSD 1006 of 2013
Judges:	BESANKO, MIDDLETON AND NICHOLAS JJ
Date of judgment:	19 June 2014
Catchwords:	PATENTS – lack of inventive step – whether the invention would be obvious to the hypothetical skilled addressee of the patent at the priority date – whether the hypothetical skilled addressee of the patent would have undertaken the steps in the patent as a matter of routine to lead, as a matter of course, to the invention – whether expectation of hypothetical skilled addressee of the patent in undertaking the steps in the patent is a necessary element of the test of obviousness – whether hypothetical skilled addressee of the patent must have expectation of successful production of the invention or “some other useful result” – whether the reformulated Cripps question is a test of universal application – lack of fair basis – lack of novelty. PRACTICE AND PROCEDURE – application for leave to appeal against interlocutory decision on admissibility of evidence pursuant to r 34.50 of the Federal Court Rules 2011 (Cth) – whether application made out of time – where application for leave to appeal filed within time to apply for leave to appeal from orders – whether interlocutory decision sufficiently connected with orders such that time began to run on date of orders. EVIDENCE – admissibility of experimental proof of facts – Federal Court Rules 2011 (Cth) r 34.50 – whether manufacture of tablets to be used in dissolution test experiments the subject of directions pursuant to r 34.50 forms part of the experimental proof of fact – whether manufacture of tablets akin to manufacture of standard products used in the course of an experiment. Held: Appeal dismissed.
Legislation:	Federal Court Rules 2011 (Cth) r 34.50 Patents Act 1990 (Cth) ss 7, 18, 19, 40, 138
Cases cited:	Aktiebolaget Hässle and Another v Alphapharm Pty Ltd (2002) 212 CLR 411 Alphapharm Pty Ltd v H Lundbeck A/S and Another (2008) 76 IPR 618 Atlantis Corporation Pty Ltd and Another v Schindler and Others (1997) 39 IPR 29 CCOM Pty Ltd and Another v Jiejing Pty Ltd and Others (1994) 51 FCR 260 Coulton & Others v Holcombe & Others (1986) 162 CLR 1 Decor Corporation Pty Ltd and Another v Dart Industries Inc (1991) 33…