Australian High Court rules on patentability of methods of medical treatment

Author: Eddy D. Ventose (Faculty of Law, University of the West Indies, Cave Hill Campus, Barbados)

Apotex Property Limited v Sanofi-Aventis Australia Property Limited [2013] HCR 50, 4 December 2013

Journal of Intellectual Property Law & Practice (2014)doi: 10.1093/jiplp/jpu008, first published online: February 17, 2014

The High Court of Australia, which had previously skirted around the issue of patenting methods of medical treatment, has finally decided that such methods are patentable under the section 18(1)(a) of the 1990 Patents Act.

Legal context

Although the formula for preparation and the composition of the drug Leflunomide, which is used for the treatment of psoriatic and rheumatoid arthritis, was the subject of an expired Australian patent, a method of using Leflunomide was still subject to an existing patent. This patent claimed a method of preventing or treating a skin disorder, psoriasis, where the treatment involved administering the patient an effective amount of the pharmaceutical composition containing as an active ingredient a compound of the formula I (ie Leflunomide) or II (which will be outlined below).

In 2008, Apotex obtained registration of generic versions of Leflunomide with the intention of supplying the products and offering them for sale in Australia as treatment for psoriatic arthritis and rheumatoid arthritis. Sanofi-Aventis, the registered owner of the patent at issue, sued Apotex for infringement of its patent for a method of using a known drug to prevent or treat psoriasis. At trial, the judge allowed the claim for infringement, and the subsequent appeal to the Full Court was dismissed. Apotex appealed to the High Court, which granted special leave on the basis that the Full Court had erred in finding that the claim of the patent claimed a manner of manufacture within the meaning of s 18(1) of the 1990 Act. Section 18(1)(a) provides one of the conditions necessary for an invention to be patentable, namely, that it ‘[be] a manner of manufacture within the meaning of section 6 of the Statute of Monopolies’.

Facts and analysis

Previous Australian authorities

The court first considered the early United Kingdom cases on the meaning of ‘manner of manufacture’ as it relates to methods of medical treatment, namely, C & W's Application (1914) 31 RPC 235 and Schering AG's Application [1971] 1 WLR 1715. Chief Justice French claimed that obiter dicta and passing references to the patentability of medical treatments had been made in four decisions by the High Court of Australia, but in none of them had the question of patentability been determined. The first was Maeder v Busch (1938) 59 CLR 684, which concerned ‘a process for forming permanent waves in hair’, where the High Court made a distinction between the motive and purpose of the operator. These views, French CJ held, were inconclusive and obiter. The next decision was NRDC (1959) 102 CLR 252, which concerned a method for using a herbicide on crops, where the High Court held that the application of the criterion ‘manner of manufacture’ to a method or process was not constrained by requiring the method or process to be linked to a narrowly defined understanding of a ‘vendible product’. French CJ noted that the High Court in NRDC speculated, in parentheses, that the exclusion of methods of surgery and other processes for treating the human body could well lie outside the conception of invention ‘because the whole subject is conceived as essentially non-economic’.

The third decision was Joos v Commissioner of Patents (1972) 126 CLR 611 where the patent was for a process for the treatment of parts of the human body, namely, human hair and nails. There, doubts were expressed concerning the statement made in NRDC relating to the exclusion of methods of medical treatment from patent protection on the basis that they were essentially non-economic. Advanced Building Systems Pty Ltd v Ramset Fasteners (Aust) Pty Ltd (1998) 194 CLR 171; [1998] HCA 19 was the fourth decision, and it reiterated the approach of the High Court in NRDC. The view of the High Court in Joos was taken a step further by the Full Court of the Federal Court in Rescare Ltd v Anaesthetic Supplies Pty Ltd (1994) 50 FCR 1 where it was stated, obiter, that there was no reason in principle why a method of treatment of the human body was any less a manner of manufacture than a method for ridding crops of weeds as in NRDC. Bristol-Myers Squibb Co v FH Faulding & Co Ltd (2000) 97 FCR 524 followed Rescare, noting there was ‘the insurmountable problem, from a public policy viewpoint, of drawing a logical distinction which would justify allowing patentability for a product for treating the human body, but deny patentability for a method of treatment’.

The judgments

According to French CJ the primary question was whether methods of medical treatment of human beings, including surgery and the administration of therapeutic drugs, could be the subject of patents: in other words, whether a method of medical treatment of human beings was capable of being a patentable invention. French CJ noted that the history of the exclusion of medical treatments from patentability did not disclose a stable, logical or normative foundation and seemed to depend upon rather nice distinctions for its maintenance. He argued that there was a logical and normative tension between the patentability of pharmaceutical products and the exclusion from patentability of methods of medical treatment. In his view, there was a difficulty in drawing a boundary between medical and cosmetic procedures, since the latter might include procedures having both medical and cosmetic benefits: for example, lap band surgery. French CJ claimed that the endeavour to achieve coherence in this area fell more readily within the institutional competence of the courts than the endeavour to strike some balance between competing public and private interests.

French CJ continued that the field of intellectual property law as a whole was notoriously one in which public interests and private interests compete with one another, and noted that it might be in public interest to use the grant of monopoly to encourage technical innovation. A competing public interest might lie in ensuring unconstrained access by medical practitioners and their patients to new medical methods and processes. The interests of inventors and investors in inventions, and the interests of members of the public whose lives could be improved or saved by the use of innovative medical treatments, might be in tension with each other and with aspects of the public interest.

French CJ accepted that to decide that the concept of ‘manner of new manufacture’ did not logically exclude methods of medical treatment from patentability, did not engage with those larger questions, although it might have significant consequences for public policy. In his opinion, this was a case in which such considerations were best left to the legislature: the application of the rubric ‘manner of new manufacture’ in a logically and normatively coherent way was not served by excluding from its scope methods of medical treatment of human beings. French CJ concluded that methods of medical treatment could fall within the scope of a manner of new manufacture within the meaning of s 6 of the Statute and therefore within s 18(1)(a) of the 1990 Act.

Crennan and Kiefel JJ, concurring, held that, assuming that all other requirements for patentability were met, a method (or process) of medical treatment of the human body which was capable of satisfying the NRDC test, namely that it was a contribution to a useful art having economic utility, could be a ‘manner of manufacture’, and therefore a patentable invention within the meaning of s 18(1)(a) of the 1990 Act. This result, they argued, was based on the following reasons: first, in the context of patent law, the expression ‘essentially non-economic’ derived its meaning from the long-understood requirement that the subject matter of a patent (whether a product, or a method or process) must have some useful application, that is, must be capable of being practically applied in commerce or industry. Secondly, the 1990 Act contained no specific exclusion from patentability of methods of medical treatment of the human body, nor could any be implied. Thirdly, there was no normative distinction to be drawn from the provisions of the 1990 Act between methods of treatment of the human body which were cosmetic and those which were medical. Fourthly, and critically, the subject matter of a claim for a new product suitable for therapeutic use, claimed alone (a product claim) or coupled with method claims (combined product/method claims), and the subject matter of a claim for a hitherto unknown method of treatment using a (known) product having prior therapeutic uses (a method claim), could not be distinguished in terms of economics or ethics. Fifthly, a method claim in respect of a hitherto unknown therapeutic use of a (known) substance or compound satisfied the general principle laid down in NRDC—it belonged to a useful art, effected an artificially created improvement in something and could have economic utility. Sixthly, the practice of the Australian Patent Office, following Joos (which practice was in evidence in Rescare, and about which no negative evidence was led in this case), was consonant with Article 27(1) of the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs). Seventhly, the obiter dicta in NRDC, upon which Apotex relied, conveyed some hesitation about ‘putting aside’ methods of treatment of the human body.

Gageler J also wrote briefly to agree with Crennan and Kiefel JJ, adding an eighth reason why medical treatment methods were patentable, namely, the decision of Federal Court in Bristol-Myers Squibb had since been regarded as representing orthodoxy in Australian patent law, and to change it after 13 years would (a) risk disappointing commercial expectations legitimately formed and acted upon; (b) undermine the legislative assumption made seven years ago; and (c) render the current legislative definition in part redundant.

Hayne J penned a vigorous dissent, claiming that the issue was whether the method of prevention or treatment of a human disease claimed in the patent in suit was a patentable invention. He claimed that no decision of the High Court determined that a method of prevention or treatment of human disease was a proper subject for the grant of a patent. After examining the leading UK and Australian authorities, which had dealt with the issue, Hayne J held that a method of preventing or treating human disease was a process that was not a proper subject for the grant of a patent.

Practical significance

The clear implication of this decision of the High Court of Australia was that methods of medical treatment are patentable in Australian patent law. While the claim was a method of administering the drug to the patient, such claim has been held not to amount to a method of medical treatment in the United Kingdom (Actavis UK Limited v Merck & Co Inc [2008] EWCA 444; [2008] RPC 26). However, the High Court has seemingly held that all such methods of medical treatment, namely methods of treatment by surgery and by therapy as well as diagnostic methods, are patentable under the 1990 Patents Act. Similarly, patent protection for dosage regimes, which are now permitted under the European Patent Convention (G 2/08 ABBOTT RESPIRATORY/Dosage regime [2010] 10 OJEPO 456), have now been sanctioned in Australia as a result of the decision of the High Court in Apotex. While there is much litigation in Europe and the UK in relation to the parameters of the exclusion for methods of medical treatment, this will not occupy the time of the courts in Australia. Rather, much like the Supreme Court of the United States in Mayo Collaborative Services v Prometheus Labs 132 S Ct 1289; 182 L Ed 2d 321 (2012), the High Court of Australia might soon have to answer the question of whether genetic diagnostic methods are patentable.

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