IP SPOTLIGHT 28 June 2021

IP SPOTLIGHT NEWS FROM AUSTRALIA & NZ

28 June 2021

THE CANADIAN SEQUEL TO AN AUSTRALIAN DECISION

Last year, the Australian Federal Court issued its decision concerning the Prevnar 13 vaccine in Merck Sharp & Dohme Corporation v Wyeth LLC [2020] FCA 1477 (Prevnar 13 AU). This year, the Federal Court of Canada decided very similar questions in Merck Sharp & Dohme v Wyeth Canada Inc 2021 FC 317 (Prevnar 13 CA). While the cases are interesting for a range of reasons, a comparison between the two decisions shows different approaches to the construction of “comprising” when used in claims which warrant consideration.

BACKGROUND Streptococcus pneumoniae causes serious bacterial infections and addressing it has been a challenge for many years and, for the companies involved in this litigation, since the 1980’s. Immunisation can address this issue. Wyeth had immunised over 1.5 billion people around the world within a decade covered by the relevant patents which represented a significant improvement on earlier vaccines, such as Prevnar 7 and Prevnar 9, which had lesser serotype coverage, i.e. less effective against pneumococcal disease. Thus, Wyeth’s patents concerning Prevnar 13 were of great value and contentious, leading to litigation with Merck around the world as Merck wished to commercialise its own 15-valent pneumococcal polysaccharide protein conjugate vaccine.

The key issue was a relatively simple one of construction - the gateway to analysis in any patent litigation.

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QUEST IONS OF CONSTRUCT ION Claim 1, from the Australian and Canadian composition patents, read (in part): A multivalent immunogenic composition, comprising 13 distinct polysaccharide-protein conjugates, together with a physiologically acceptable vehicle, wherein each of the conjugates comprises a capsular polysaccharide from a different serotype of Streptococcus pneumoniae. – that the claim be limited to a composition consisting of 13 distinct polysaccharide-protein conjugates, or – that the claim encompassed a composition including 13 or more distinct polysaccharide-protein conjugates? Unsurprisingly, Merck argued for the first construction (its proposed vaccine had 15 serotypes). The invention was at most a 13-serotype vaccine and, if it was incorrect on that, the claim was overbroad and not supported (from the perspective of Australian patent law). Wyeth, on the other hand, argued that its patents provided a platform to make polysaccharide conjugate vaccines comprising 13 or more serotypes of S. pneumoniae. The Prevnar 13 vaccine was the result of years of experimental work and it was the ‘gold standard’ of the industry. The skilled person would appreciate that, through the expression “comprising 13”, the composition patent was aimed at providing such a platform broadening the range of serotypes and coverage of pneumococcal infections in a “next generation” of its development program. The skilled person would have used the platform to add other serotypes in a future vaccine. Wyeth argued that the term “comprising” should be construed in an inclusive sense, meaning “including but not limited to”. This represents a position where the claims, and by extension the specification, simply provide a guide to – rather than a boundary fence around – the protected invention. Merck argued that the word “comprising” allows for more elements in the composition, such as acceptable physiological vehicles and/or adjuvants. However, the claimed compositions were only to polysaccharide-protein conjugates of each of the chosen 13 serotypes. This construction, which gave a common sense and practical result, was the only one consistent with the description in the specification. So arose an old question in patent law, the bounds of the term “comprising”. Did this claim intend:

THE AUSTRAL I AN DECI S ION In Australia, the Court accepted Wyeth’s construction. The words “comprising” and “comprises” were clearly defined in the specification in an inclusive sense. The only exception was if the context required otherwise. The scope of claim 1 was to be defined by what the composition includes not what it consists of so, as a matter of impression, any composition containing 13 serotypes (e.g. 15 serotypes) would be within the scope of claim 1 unless the language of the claims supported an alternative construction. The specification was not sufficient to resolve this question. The Court also dismissed Merck’s argument that, if Wyeth had wanted to claim immunogenic compositions with more than the 13 chosen serotypes, it could have done so by using the words “at least” before listing the serotypes but did not. However, the Court had to determine what the claim wording was not what it might have been. Nevertheless, there is a message here for the patent drafter. On interpretation of the specification, Burley J appeared to be moved by a reference that the invention provides generally a multivalent composition comprising 13 serotypes. No maximum number of potential serotypes was given by the specification. Wyeth therefore succeeded on establishing that “comprising” was used in an inclusive sense, effectively meaning that claim 1 addressed compositions including at least 13 serotypes. Following resolution of another construction argument, a finding of infringement followed. THE CANAD I AN DECI S ION In Canada, the Court accepted Merck’s construction. Claim 1 was limited to 13 serotypes. Whilst the word “comprising” was open-ended, inclusion of other elements required some justification as provided by the patent description. On a reading of the patent, with which the present writer respectfully agrees, there was sufficient basis for adding adjuvants, buffers and other excipients. However, there was no basis to go beyond 13 serotypes. Relevant parts of the description included the Summary of the Invention and the examples. All 16 examples referred only to the specific serotypes recited in the claims and no others.

The Court also observed that, if it sided with Wyeth on the construction of claim 1, it would have to choose a cap on the number of serotypes covered by the invention or that could be added using Wyeth’s “so-called ‘platform’”. It would also mean that the ambit of Wyeth’s monopoly could grow over the life of the patent as new serotypes were discovered. This would be contrary to fundamental principles of claim construction. KEY TAKEAWAYS The “comprising” construction issue was resolved differently in Australia and Canada and provides guidance for those preparing and enforcing patents, especially patents in the pharmaceutical and immunology fields. The Australian decision certainly favours a broad construction of a claimed invention and, on this occasion, provides a result in which the drafting patent attorney might well be happy. On another occasion such a reading might cause a collision between the claim and prior art but not this time. However, the Canadian decision better reflects what the outcomes for drafting should be where the briefing is of an invention having broader reach, i.e. where an increasing number of serotypes, and better coverage of the infectious disease (the platform theory) could be achieved. It would be a straightforward matter, as Merck argued, to recite “at least 13” and, while Burley J is, with respect, correct that the Court must construe the words as they stand, the result is more generous than expectation. Another interesting point is that, certainly under current applicable law requiring support, rather than fair basis, another serious issue might have arisen for Wyeth, though plausibility might have saved the day there.

RICHARD BADDELEY Principal

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EUROPEAN STUDY DEMONSTRATES

A recent joint study by the European Patent Office (EPO) and the European Union Intellectual Property Office (EUIPO) has revealed that companies that own at least one registered intellectual property right (patents, designs, trade marks) generate 20% higher revenues per employee compared to companies with no registered intellectual property rights (IPRs). Companies owning IPRs were also found to pay 19 % higher wages on average. While the study notes that the findings “do not constitute conclusive proof that encouraging firms to make greater use of IPRs will cause their performance to increase”, it does demonstrate a strong positive relationship between IP ownership and economic performance. This is particularly so for SMEs, with the study finding SMEs that own IPRs have a 68% higher revenue per employee than those that do not. By comparison, for large companies, this revenue premium is 18%. Despite these findings, only 9% of European SMEs own any IPRs. The data highlights the significant potential for SMEs to exploit IPRs. Patent ownership correlated to the largest increases with 36% higher revenue per employee and 53% higher wages, followed by registered designs (32% higher revenue and 30% higher wages) and trade marks (21% higher revenue and 17% higher wages). Companies with a combination of IPRs enjoyed even higher revenues.

Antonio Campino, EPO President stated:

POSITIVE RELATIONSHIP BETWEEN IP OWNERSHIP

“The study further demonstrates that there is significant untapped potential for SMEs in Europe, as it shows that they stand to benefit the most from owing intellectual property. Added to this, business which make intensive use of IPRs helped pull us through the 2008 financial crisis, so I strongly believe innovation will help drive Europe’s recovery from the impact of COVID-19”. While the study was of the European economy and European IPRs, these findings are applicable to other major economies and provides evidence of the importance of IPRs to economic performance.

AND ECONOMIC PERFORMANCE

BRENDAN PEACHEY Principal

Christian Archambeau, EUIPO Executive Director, in a statement said:

“In a critical context for the majority of European businesses, these results underline the importance of making it easier for small companies to protect their innovations and creativity with IP rights, one of the major goals of our Strategic Plan 2025”.

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The primary judge had found that the series of disclosures were a ‘necessary precursor’ to the public working of the invention and as such were captured by the grace period. This was overturned by the Full Federal Court on appeal on the basis that the first and second disclosures were nothing more than the inventor trying to create interest in the invention (see para [286]) and noted that the inventor could (and by extension should) have been made under express or implied conditions of confidentiality. Typically, the nature of public disclosures that have attracted the benefit of the grace period of s 24(1)(a) and Reg. 2.2(2) (d) have been those in which a large item of machinery that incorporates a mechanical invention, for example, must be worked outdoors ‘in public’ by its nature. Put another way, there has been no way in which it might reasonably be worked indoors, in private, and provide the inventor(s) with the desired information that will inform the process of conceiving and refining the invention. The car park demonstration by the inventor to the staff of a mine was not found to sit well with the relevant precedents. First, it should be noted that these comments are provided with the benefit of 20/20 hindsight and without any in depth understanding of the specific circumstances over and above that of the decisions referend here. However, if rather than filing a provisional patent application in September 2011, a complete application was filed, then Quaker will have had access to the grace period available under s 4(1)(a) and Reg.2.2 (1A), which rather than being limited to working of the invention in public for the purposes of trial, would have provided protection from any publication or use of the invention. These circumstances highlight how important it can be to fully understand what use of the invention has been made prior to filing. A full disclosure of any use of an invention to your patent attorneys will allow the appropriate strategy to be followed in seeking valid patent protection. What Might Have Been Done Differently?

The Long and the Short of It

In the recently decided appeal case of Fuchs Lubricants (Australasia) Pty Ltd v Quaker Chemical (Australasia) Pty Ltd [2021] FCAFC 65, the distinction between these two grace period options became very important. The full text of the decision can be accessed here. Quaker Chemical (Australasia) Pty Ltd (Quaker) are (for the moment) the owner of a standard patent and a divisional innovation patent, both titled “Method for Detecting Fluid Injection in a Patient”. It relates to detecting High Pressure Fluid Injection (HPFI) injuries that can be sustained by workers when impacted by high pressure fluid escaping from, for example, hydraulic machinery used in mines. In short, a detectable dye is mixed with the hydraulic fluid, whereby inspection of the patient post injury reveals the presence of the dye under the skin. At first instance, Quaker (who had acquired the invention and patent from the inventor and his company) sued Fuchs for infringement of the patent. Fuchs denied the infringement and sought revocation of the patent in turn. In seeking revocation Fuchs referred to a series of disclosures that occurred in October/November 2010 (referred to as first, second and third disclosures) being within 12 months prior to the filing of a provisional patent application by the inventor and from which the patent in question claimed priority (the provisional application was filed on 2 September 2011). These disclosures however occurred more than 12 months prior to the filing of the complete patent application (on 2 February 2012) that resulted in grant of the patent being relied upon. The primary judge had found that each of the first, second and third disclosures fell within the grace period of 12 months prior to the priority date of a claim to the invention as being “working in public of the invention”… “for the purposes of reasonable trial”. Fuchs appealed this finding, amongst others. The first and second disclosures involved the disclosure of the invention to the staff of a mine (Peabody Energy Australia Pty Ltd’s Metropolitan mine in Helensburgh, NSW), which involved a demonstration of the invention to those staff in a car park, which demonstration creatively made use of a ‘gelatine hand’ simulator. The third disclosure was a subsequent disclosure of the invention by Metropolitan mine staff to Fuchs. The Gelatine Hand of Fate

PATENTS UNDONE BY A SALES PITCH AND A GELATINE HAND

NOT ALL GRACE PER IODS ARE CREATED EQUAL What’s a Grace Period? The Australian Patents Act 1990 and regulations provides a number of circumstances in which a ‘grace period’ can be relied upon in a defence to alleged lack of novelty and/or inventive step. That is, there are some things that you can do with your invention before you file a patent application without impacting on its validity.

The term is also used to refer to a range of circumstances that are permissible up to 12 months prior to the priority date for a claim for the invention. These circumstances include the “working in public of the invention”… “for the purposes of reasonable trial” (see s 24(1)(a) and Reg. 2.2(2)(d)). The important distinction is that the first circumstance provides a broad 12 month period of exemption prior to the filing of a complete patent application. The second set of circumstances provides the more time generous exemption of up to 12 months prior to the priority date (for example, this may be the filing date of a provisional patent application or an overseas-filed priority patent application) but more limited exemption in terms of circumstances.

Which Grace Period are we Dealing With?

PETER CAPORN Principal

The term ‘grace period’ is used broadly to describe a range of circumstances. Most commonly at present it is used to describe the ability to set aside any publication or use of an invention that occurred up to 12 months prior to the filing of a complete application (see s 24(1)(a) and Reg.2.2 (1A).

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