Canada Patent Litigation: Federal Court Rules “Enhanced Disclosure” Requirement for Sound Prediction Applies Only To “New Use” Patents
On July 2, 2014, Mr. Justice Rennie of the Federal Court released his judgment and reasons in Astrazeneca Canada Inc v. Apotex Inc., 2014 FC 638 dismissing AstraZeneca’s action for infringement and granting Apotex’s counterclaim for a declaration that Canadian Patent 2,139,653 (the “‘653 Patent”) is invalid. This patent relates to AstraZeneca’s successful drug NEXIUM® (esomeprazole).
Justice Rennie found the invention of the ‘653 Patent was novel and non-obvious, but nevertheless invalidated the patent for promising an improved therapeutic profile which was not soundly predicted.
While Justice Rennie canvassed a number of legal issues, his holding regarding the so-called “enhanced disclosure” requirement for sound prediction is particularly interesting as it represents a landmark ruling in the evolution of sound prediction law in Canada. His analysis on the issue is found at paragraphs 139-161 of the decision.
Assuming any disclosure requirement exists at all in respect of sound prediction – which Justice Rennie viewed as questionable in light of the Supreme Court of Canada’s recent ruling in the Viagra case – he held that it is restricted to “new use” patents.
Following the Supreme Court’s decision in Apotex Inc. v. Wellcome Foundation Ltd., 2002 SCC 77 (“AZT”), and in respect of utility based on sound prediction, the Federal Court of Appeal recognised a general “heightened obligation to disclose the underlying facts and the line of reasoning for inventions that comprise the prediction” (Elli Lilly Canada Inc v Apotex Inc, 2009 FCA 97 at para 14, “Raloxifene”; see also Lilly and Company v. Teva Canada Limited, 2011 FCA 220, “Atomoxetine”).
Some have viewed this nebulous enhanced disclosure obligation as applying to all types of patented inventions where any aspect of utility is based on a prediction.
In this case, however, Justice Rennie disagreed with the view that AZT suggests an enhanced disclosure requirement in all cases of prediction for two primary reasons:
- Justice Binnie described that while generally inventors do not need provide a theory of why the invention works, in the “sort of case” of AZT, sound prediction is to some extent the quid pro quo the applicant offers in exchange for the patent monopoly (AZT, para. 70). Justice Rennie reasoned that Justice Binnie’s reference in AZT to this “sort of case” clearly meant he was referring to a subset of sound prediction cases. In other words, this suggests there are other sorts of cases where the sound prediction is not the quid pro quo offered by the patentee, for which presumably there is no heighted disclosure obligation.
- Principally, Justice Rennie further reasoned, that where a new use is patented for an old compound (as in the AZT case) “there may be an enhanced disclosure requirement because utility is the only thing being offered in exchange for the patent monopoly since the compound itself was previously disclosed”.
As support for his interpretation of AZT, Justice Rennie found his views consistent with Justice Gauthier’s recent concurring reasons in the FCA’s “Plavix” decision (Sanofi-Aventis v. Apotex Inc., 2013 FCA 186 at para. 135).
His analysis is also grounded by the Patent Act, as utility (section 2) and disclosure (section 27(3)) are addressed separately, suggesting there is no statutory basis for combining the two to create a disclosure requirement for utility, even when it is based on a prediction.
Finally, Justice Rennie concluded that Justice Lebel’s remarks (albeit obiter) in Viagra overturn previous FCA jurisprudence (such as for example, Raloxifene and Atomoxetine) in so far as it might have required enhanced disclosure in all sound prediction cases.
The Supreme Court may have the last word: Justice Rennie’s decision highlights the notion that the level of disclosure required in patents where the invention’s utility is based on a sound prediction, has deviated from what was intended by AZT. With the Supreme Court set to hear the Plavix appeal this Fall (for which sound prediction and disclosure are main issues), that Court may soon be writing the governing decision on sound prediction law in Canada.
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