Pharmacia LLC v Juno Pharmaceuticals Pty Ltd - [2022] FCAFC 167

FEDERAL COURT OF AUSTRALIA
Pharmacia LLC v Juno Pharmaceuticals Pty Ltd [2022] FCAFC 167

Appeal from:
Pharmacia LLC v Juno Pharmaceuticals Pty Ltd [2022] FCA 92;

Pharmacia LLC v Juno Pharmaceuticals Pty Ltd (No 2) [2022] FCA 369

File number: NSD 294 of 2022

Judgment of: JAGOT, YATES AND DOWNES JJ

Date of judgment: 29 September 2022

Catchwords:
PATENTS – standard patent claiming reconstitutable powder composition containing a cyclooxygenase-2 inhibitor for parenteral administration – claim construction – whether claims include or exclude residual water from the composition – meaning of “about” as used in claims – whether omnibus claim infringed – whether error in finding that only certain exemplar batches of product infringed – no error shown

PATENTS – validity – lack of inventive step – where respondents put forward eight-step development pathway leading to claimed invention – development pathway was not obvious – whether prior art information could be reasonably expected to have been ascertained – no error shown

PRACTICE AND PROCEDURE – respondents permitted to amend defence after commencement of trial – where no evidence adduced by respondent to explain withdrawal of admissions – where appellants did not raise serious objections to certain amendments and did not complain of prejudice in the manner contended on appeal – appellants did not apply for adjournment of the trial or for directions to enable further documents to be obtained to meet claimed prejudice – no error shown

PRACTICE AND PROCEDURE – complaint that primary judge failed to make declarations of infringement and costs orders as sought by appellants – no error shown

Legislation:
Federal Court of Australia Act 1976 (Cth) ss 37M, 37N

Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (Cth)

Patents Act 1990 (Cth) ss 7(2), 7(3), 40(2)(b)

Patents Amendment Act 2001 (Cth)

Cases cited:
AstraZeneca AB v Apotex Pty Ltd (2015) 257 CLR 356; [2015] HCA 30

Britax Childcare Pty Ltd v Infa-Secure Pty Ltd [No 3] [2012] FCA 1019

Brugger v Medic-Aid Ltd [1996] RPC 635

Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft (2014) 222 FCR 336; [2014] FCAFC 73

GlaxoSmithKline Australia Pty Ltd v Reckitt Benckiser Healthcare (UK) Ltd (2016) 120 IPR 406; [2016] FCAFC 90

House v The King [1936] HCA 40; (1936) 55 CLR 499

Inverness Medical Switzerland GmbH v MDS Diagnostics Pty Limited (2010) 85 IPR 525; [2010] FCA 108

Jushi Group Co Ltd v OCV Intellectual Capital LLC [2018] EWCA Civ 1416

Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) (2007) 235 CLR 173; [2007] HCA 21

Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd (2020) 279 FCR 354; [2020] FCAFC 116

Nichia Corporation v Arrow Electronics Australia Pty Ltd [2019] FCAFC 2

Nokia Corporation v Liu (2009) 179 FCR 422; [2009] FCAFC 138

Pharmacia LLC v Juno Pharmaceuticals Pty Ltd (2022) 165 IPR 200; [2022] FCA 92

Pharmacia LLC v Juno Pharmaceuticals Pty Ltd (No 2) [2022] FCA 369

Smith & Nephew Plc…

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: [2022] FCAFC 167
Decision Date: 29 September 2022

CaseChat Overview and Summary

Pharmacia LLC initiated proceedings against Juno Pharmaceuticals Pty Ltd, alleging patent infringement concerning a standard patent related to a reconstitutable powder composition containing a cyclooxygenase-2 inhibitor intended for parenteral administration. The crux of the dispute revolved around the interpretation of patent claims, specifically whether they included or excluded residual water from the composition and the meaning of the term “about” as used in the claims. The case also addressed the validity of the patent, particularly whether it lacked an inventive step and if a proposed eight-step development pathway to the claimed invention was non-obvious. The respondents sought to amend their defence during the trial, which the appellants contested. Lastly, the appellants argued that the primary judge should have made specific declarations of infringement and costs orders as requested. The Federal Court of Australia was tasked with resolving these complex issues.

The court was required to decide several legal issues, including the proper construction of the patent claims to determine whether they included or excluded residual water, the interpretation of the term “about” in the claims, and whether the respondents' proposed development pathway demonstrated a lack of inventive step. Additionally, the court had to determine whether the primary judge erred in allowing the respondents to amend their defence during the trial and whether the primary judge should have made specific declarations of infringement and costs orders.

The court found no error in the primary judge's decision to permit the respondents to amend their defence during the trial. The appellants did not object seriously to certain amendments and did not demonstrate prejudice. Regarding the interpretation of the patent claims, the court held that the claims did not exclude residual water from the composition and that the term “about” was consistent with the prior art. The court also concluded that the respondents' proposed development pathway was non-obvious, thereby upholding the patent's validity. Lastly, the court found no error in the primary judge's decision not to make specific declarations of infringement and costs orders, as the parties had reached an agreement on the scope of infringement.

The appeal and cross-appeal were dismissed, with the appellants ordered to pay the respondents' costs of the appeal, and the cross-appellants ordered to pay the cross-respondents' costs of the cross-appeal. The primary judge's findings on patent infringement and validity were upheld, and the parties were directed to agree on the form of short minutes of order to reflect these reasons.

Orders

Orders of the court

1. The appeal and cross-appeal are dismissed.

2. The appellants pay the respondents’ costs of the appeal.

3. The cross-appellants pay the cross-respondents’ costs of the cross-appeal.

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

Background

Background to the litigation

The next question concerns the decision of the primary judge to permit the respondents to file an Amended Defence to the Amended Statement of Claim during the trial. This question is raised by ground 3 of the Notice of Appeal.Relevant background By their Amended Statement of Claim filed on 4 November 2020, the appellants pleaded the following at [13]–[15]:13.Juno offers for sale, and supplies, the Juno Products in Australia for use by persons for the management of post-operative pain, in accordance with the Approved Indication.14.Neo supplies the Juno Products to Juno for sale on the Australian market.…15.Each of the Juno Products [has certain features]. By their Defence filed on 6 November 2020, the respondents admitted [13] and [14] and, in response to [15] of the Amended Statement of Claim, pleaded as follows:They admit that each of the Juno Products is a pharmaceutical composition, comprising in powder form, parecoxib sodium, sodium phosphate-dibasic anhydrous, phosphoric acid and sodium hydroxide, where the composition is re-constitutable in a parenterally acceptable solvent liquid to form an injectable solution, but otherwise deny each of the allegations in paragraph 15 thereof. By letter dated 23 April 2021, after the trial had commenced on 19 April 2021, the respondents’ solicitors provided to the appellants’ solicitors a proposed Amended Defence and stated that the amendments address three substantive matters:1.The first formalises the position previously indicated by our clients in relation to the pH adjusters [sic] issue (see paragraphs 15 and 30);2.The second relates to the 2016 batch records provided to you in 2018. As you are aware those 2016 batch records are exhibit batches which were generated for the purposes of obtaining regulatory approval in relation to the Juno Products (as defined in the pleadings) and were not commercial batches. Whilst those 2016 batch records are an acceptable proxy for the commercial batches of the Juno Products sold by the First Respondent those batches were not, themselves, sold or supplied in Australia or ever brought into Australia. The proposed amendments to paragraphs 13 and 14 of the Amended Defence formalises that position.3.Paragraph 14 also formalises the position with respect to the sale by the Second Respondent to the First Respondent of the whole of its interest in the Juno Products, as notified by you by our letter to you of 24 August 2020. The proposed Amended Defence included these paragraphs which reflect the mark-up as contained in the document handed up during the hearing of the trial on 27 April 2021:13.They admit paragraph 13 thereof but say for the avoidance of doubt that Juno Products manufactured in 2016 in batch numbers 31601 to 31606 were not sold or supplied in Australia nor brought into Australia at all.14.They admit paragraph 14 thereof. As to paragraph 14 thereof, they admit that Neo supplied Juno Products to Juno for sale on the Australian market until August 2020 but say for the avoidance of doubt that Juno Products manufactured in 2016 in batch numbers 31601 to 31606 were not supplied for sale in the Australian market nor brought into Australia at all.15.They admit that each of the Juno Products is a pharmaceutical composition, comprising in powder form, parecoxib sodium, sodium phosphate-dibasic anhydrous, and phosphoric acid or phosphoric acid and sodium hydroxide, in order to adjust the pH where necessary, where the composition is re-constitutable in a parenterally acceptable solvent liquid to form an injectable solution, but otherwise deny each of the allegations in paragraph 15 thereof.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

In ground 1 of their Notice of Contention in the cross-appeal, the appellants also contend that the primary judge ought to have rejected the respondents’ lack of inventive step claim on the basis that the evidence did not establish that the person skilled in the relevant art could, before the priority date, be reasonably expected to have ascertained the information in the prior art documents referred to as Jain and Talley. Given our conclusions above, it is unnecessary to resolve this issue.DECLARATIONS In ground 6 of their Notice of Appeal, the appellants contend that the primary judge erred in failing to make declarations of infringement as they had sought. At [217] J1, the primary judge found that:(1)batches 31601, 31602 and 31603 do not fall within the scope of claim 1 or any of its relevant dependent claims; and(2)batches 31604, 31605 and 31606 fall within the scope of claim 1 and also claim 11. Having regard to the admissions made by the respondents regarding the features of the Juno products, these three batches also fall within the scope of claims 4, 5, 14, 15, 17, 18, 19, 20, 21, 24, 34, 35, 36, 37, 38, 39, 40 and 41. These batches do not fall within claim 7; and(3)none of the six representative batches fall within the scope of claim 26 or any of its dependent claims. Having regard to the Amended Defence (discussed above), the primary judge also said at [420] J1:I have found that certain of six exemplar batches of the Juno products would, had they been made or imported into Australia, have infringed each of claims 1, 4, 5, 11, 14, 15, 17, 18, 19, 20, 21, 24, 34, 35, 36, 37, 38, 39, 40 and 41 but not claims 7, 26, 27, 28, 30 and 42 and that the challenge to the validity of the relevant claims fails. At trial the parties agreed that such findings will be sufficient for them to reach agreement as to the scope of the infringement by the respondents with regard to the Juno products sold in Australia. I will make directions for the parties to endeavour to agree to the form of short minutes of order giving effect to these reasons and list the matter for case management. It is not unusual for cases of this sort to involve a dispute as to the appropriate costs order to make. My preliminary view is that the applicants have succeeded in all but relatively limited respects and that the result should be the respondents pay the applicants’ costs of the claim and the cross-claim. However, the parties may make provision for the filing of short submissions on the subject of costs should they be unable to agree on that subject. To the extent it related to the making of the declarations, but not the issue of costs, the appellants withdrew their contention that, despite these findings, the primary judge in J2 wrongly relied on evidence (an affidavit of Mr Voller of 8 March 2022) that revealed that “none of the Juno products actually imported into Australia infringed the patent having regard to the conclusions on construction reached by the Court in the judgment”: [10] J2.

Appeal from:	Pharmacia LLC v Juno Pharmaceuticals Pty Ltd [2022] FCA 92; Pharmacia LLC v Juno Pharmaceuticals Pty Ltd (No 2) [2022] FCA 369
File number:	NSD 294 of 2022
Judgment of:	JAGOT, YATES AND DOWNES JJ
Date of judgment:	29 September 2022
Catchwords:	PATENTS – standard patent claiming reconstitutable powder composition containing a cyclooxygenase-2 inhibitor for parenteral administration – claim construction – whether claims include or exclude residual water from the composition – meaning of “about” as used in claims – whether omnibus claim infringed – whether error in finding that only certain exemplar batches of product infringed – no error shown PATENTS – validity – lack of inventive step – where respondents put forward eight-step development pathway leading to claimed invention – development pathway was not obvious – whether prior art information could be reasonably expected to have been ascertained – no error shown PRACTICE AND PROCEDURE – respondents permitted to amend defence after commencement of trial – where no evidence adduced by respondent to explain withdrawal of admissions – where appellants did not raise serious objections to certain amendments and did not complain of prejudice in the manner contended on appeal – appellants did not apply for adjournment of the trial or for directions to enable further documents to be obtained to meet claimed prejudice – no error shown PRACTICE AND PROCEDURE – complaint that primary judge failed to make declarations of infringement and costs orders as sought by appellants – no error shown
Legislation:	Federal Court of Australia Act 1976 (Cth) ss 37M, 37N Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (Cth) Patents Act 1990 (Cth) ss 7(2), 7(3), 40(2)(b) Patents Amendment Act 2001 (Cth)
Cases cited:	AstraZeneca AB v Apotex Pty Ltd (2015) 257 CLR 356; [2015] HCA 30 Britax Childcare Pty Ltd v Infa-Secure Pty Ltd [No 3] [2012] FCA 1019 Brugger v Medic-Aid Ltd [1996] RPC 635 Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft (2014) 222 FCR 336; [2014] FCAFC 73 GlaxoSmithKline Australia Pty Ltd v Reckitt Benckiser Healthcare (UK) Ltd (2016) 120 IPR 406; [2016] FCAFC 90 House v The King [1936] HCA 40; (1936) 55 CLR 499 Inverness Medical Switzerland GmbH v MDS Diagnostics Pty Limited (2010) 85 IPR 525; [2010] FCA 108 Jushi Group Co Ltd v OCV Intellectual Capital LLC [2018] EWCA Civ 1416 Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) (2007) 235 CLR 173; [2007] HCA 21 Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd (2020) 279 FCR 354; [2020] FCAFC 116 Nichia Corporation v Arrow Electronics Australia Pty Ltd [2019] FCAFC 2 Nokia Corporation v Liu (2009) 179 FCR 422; [2009] FCAFC 138 Pharmacia LLC v Juno Pharmaceuticals Pty Ltd (2022) 165 IPR 200; [2022] FCA 92 Pharmacia LLC v Juno Pharmaceuticals Pty Ltd (No 2) [2022] FCA 369 Smith & Nephew Plc…