Key judgments are summarized by Nicholas Stamatiou, Paul Mallon, and Wayne Condon, all Griffith Hack, Australia.
Key case: Novozymes A/S v Danisco A/S  FCAFC 6
On February 4, 2013, the Full Court of the Federal Court of Australia handed down its decision in Novozymes A/S v Danisco A/S, upholding an appeal by Novozymes from an earlier decision in 2011.
A key aspect of the Full Court decision was the finding that where an invention is not expressly disclosed in full in the prior art, but where the inevitable result of following the instructions contained in the prior art is the working of the claimed invention, then such prior art may still be considered when making an assessment of the novelty of the claimed invention.
In 2011, Danisco sued Novozymes for patent infringement, alleging that a Novozymes product, called ‘Lipopan Xtra’, infringed Danisco’s Australian Patent No. 752215 (‘215 Patent). The ‘215 Patent claimed a process for preparing a foodstuff, involving use of an enzyme with certain characteristics to generate two functional ingredients. By way of counterclaim, Novozymes contended that Danisco’s claimed invention was anticipated by Novozymes’ prior patent, which contained clear directions on use of an enzyme in baking – the enzyme being of the kind described in the ‘215 Patent – thus producing the ‘inevitable result’ specified in the claims of the ‘215 Patent.
Interestingly, in the original claim, Danisco also alleged that the ‘215 Patent was infringed by another of Novozymes’ commercial products, known as ‘Lipopan F’. However, Danisco later withdrew this allegation and pursued infringement solely in relation to ‘Lipopan Xtra’. Novozymes nevertheless relied on the defense that prior disclosure of an infringement (in this case, ‘Lipopan F’) renders the claims anticipated (also known as the “Gillette defense”), and submitted that use of ‘Lipopan F’, although in relation to baking, still anticipated the claimed invention.
First Instance decision
At first instance, Novozymes submitted that if a person skilled in the art followed a particular example described in the Novozymes prior patent (i.e. specific directions to use the enzyme in baking), it would inevitably result in the foodstuff claimed in the ‘215 Patent. Novozymes thus contended that all the information needed to carry out the claimed process, recited in the ‘215 Patent, was contained in their prior patent.
In reaching her finding, the trial judge (Bennett J) found that the Novozymes patent disclosed clear and unmistakable directions to use the enzyme in baking, and that these directions would also produce the results specified in the ‘215 Patent. However, the trial judge held that the Novozymes patent did not disclose the process claimed, and the generation of the two functional ingredients specified, by the ‘215 Patent. Thus, it was not sufficient for patentability that the information provided by the Novozymes patent may have “inherently” disclosed the claimed process by which a person can use an enzyme in baking and obtain the product, because “the public will be none the wiser as to the integers of the claims”.
Anticipation by prior publication
Prior to this first instance decision, one of the leading authorities on anticipation by prior publication was the Full Court decision in H Lundbeck A/S v Alphapharm Pty Ltd  FCAFC 70. In that case, the court expressed the view that although there is anticipation where a prior publication discloses exactly what is claimed, a disclosure less than the entirety of the claim may constitute anticipation of the claimed product or process, thus rendering it not novel. Notably, it was also Bennett J (the trial judge in the first instance for the present case) who expressed this view.
In the subsequent Federal Court decision in Albany Molecular Research Inc v Alphapharm Pty Ltd, the trial judge (Jessup J) referred to Bennett J’s reasoning in H Lundbeck v Alphapharm, and stated with some apparent reluctance that he was bound to follow the law expounded in that decision, which is to say that a disclosure of a compound by exact naming in the prior art is sufficient in itself to anticipate the claimed invention.
On appeal, the Danisco case that came before Bennett J at first instance was now before Jessup J, as one of the appeal judges. In reaching his decision, he agreed with Bennett J that the Novozymes patent would not have disclosed the generation of both functional ingredients recited in the ‘215 Patent. However, Jessup J allowed the appeal and held that the ‘215 Patent was anticipated because both functional ingredients would inevitably have been generated if a person skilled in the art had followed the instructions disclosed in Novozymes’ patent. That is, by following the example described in the Novozymes patent, which involved use of the enzyme in baking, the claimed process could be carried out, resulting in the foodstuffs of the ‘215 Patent.
The appeal court also referred to the decision in General Tire, which stated the proposition that:
“… if carrying out the directions contained in the prior inventor’s publication will inevitably result in something being made or done which, if the patentee’s patent were valid, would constitute an infringement of the patentee’s claim… the patentee’s claim has in fact been anticipated.”
Jessup J noted that this proposition was framed in hypothetical terms, and that it is not relevant whether the process was in fact done or able to be done. Rather, anticipation occurs when the content of information containing directions is present, which if carried out would amount to infringement of the patent. Therefore, in the present case, the appeal court overturned the trial judge’s decision, and held that the ‘215 Patent was anticipated by Novozymes’ patent.
The decision of the appeal court resolves the uncertainty arising from the first instance decision, and clarifies that if directions in the prior art are shown to lead inevitably to the result claimed in the alleged invention, then there will be a valid ground of invalidity for lack of novelty.
Key case: Apotex Pty Ltd v AstraZeneca AB (No. 4)  FCA 162
In the decision of Apotex Pty Ltd v AstraZeneca (No. 4) delivered earlier this year, the Federal Court of Australia held that three pharmaceutical patents, protecting AstraZeneca’s CRESTOR product, were invalid. The three patents sought to protect innovations relating to the chemical compound rosuvastatin, the active ingredient used in CRESTOR, AstraZeneca’s highest-earning pharmaceutical product of 2012. The decision is significant in that it now opens the doors for Apotex, and other competitors of AstraZeneca (including Watson Pharmaceuticals Inc. and Ascent Pharmaceuticals Pty Ltd), to launch their own generic rosuvastatin products.
The rosuvastatin compound is known for its use in pharmaceuticals for the treatment of high cholesterol. The first of AstraZeneca’s patents covered the use of a low dose of rosuvastatin compound to treat high cholesterol. The second patent covered use of the rosuvastatin compound to treat HeFH, a genetic high cholesterol condition. While the third patent related to a pharmaceutical formulation of rosuvastatin comprising an inorganic salt. None of the three patents protected the rosuvastatin compound itself, nor had there ever been such a patent in Australia.
The battle began in 2011 when, in anticipation of launching its own generic product, Apotex commenced revocation proceedings in relation to the first AstraZeneca patent. By way of counterclaim, AstraZeneca alleged that Apotex’s generic product would infringe three of its patents. AstraZeneca then applied for, and was granted, an interlocutory injunction to prevent Apotex from selling its generic product prior to the trial date.
First AstraZeneca patent – Low-dose patent
At trial, all three AstraZeneca patents were held to be invalid for at least a lack of novelty and inventive step. The trial judge, Jagot J, found that the invention claimed in the first AstraZeneca patent was disclosed in prior art documents referred to as the “471 patent” and the “Watanabe article”. The 471 patent disclosed a class of compounds, which explicitly included rosuvastatin, which was known to be useful for treating high cholesterol. It also claimed a low dosage range, thus capturing the doses claimed by AstraZeneca.
The trial judge also held that the invention lacked an inventive step as the low dosages claimed were obvious against the common general knowledge, and amounted to “nothing more than the identification of a conventional starting dose for a compound”. The patent was also found to be invalid for lack of entitlement. Interestingly, following the amendments introduced by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 on April 15, 2013, lack of entitlement is no longer a ground of invalidity in patent matters.
Second AstraZeneca patent – HeFH patent
The invention of the second AstraZeneca patent was held to lack novelty and inventive step in light of a document referred to as the “SCRIP article”, which recommended treatment of HeHF using other “superstatins”, and suggested that rosuvastatin might also suffice. Furthermore, although the prior art did not explicitly teach use of rosuvastatin for treatment of HeHF specifically, the trial judge held that rosuvastatin formed part of the common general knowledge. As a result, it was held that the use of rosuvastatin for the treatment of high cholesterol would have been obvious to a person skilled in the art.
Third AstraZeneca patent – Cation patent
The third AstraZeneca patent was held to be invalid for lack of novelty that arose, in part, due to an invalid priority claim caused by significant amendment of the patent. The UK priority application related to a pharmaceutical composition of rosuvastatin and a tribasic phosphate salt, and provided no reference to any formulation that did not include the tribasic phosphate salt. By contrast, none of the claims of the third AstraZeneca patent were limited to a composition containing tribasic phosphate salt.
As a result, the trial judge held that the third AstraZeneca patent was not eligible to claim priority from the UK priority application. The invention of the third AstraZeneca patent was also found to lack an inventive step in light of the finding that the use of commonly used coatings (e.g. titanium dioxide and ferric oxide) for coating a known compound would have been obvious to a person skilled in the art.
Inventive step considerations
An important aspect of the decision was the trial judge’s approach to assessing inventive step. Apotex submitted that for the purpose of obviousness, the starting point is knowledge of rosuvastatin when seeking a solution to the problem at hand. In response, AstraZeneca submitted that knowledge of rosuvastatin cannot be the starting point unless such knowledge is part of the common general knowledge. Jagot J was of the view that a “starting point” or “problem-solution” approach is unhelpful, and noted that each assessment should be made on a case-by-case basis since, for example, the knowledge of pharmaceutical compounds is far more relevant in relation to ‘secondary’ patents filed after disclosure of the compound itself.
In reaching her decision, Jagot J found that the more persuasive view is that first, the invention must be ascertained from the patent specification, and then inventive step is assessed in light of the common general knowledge in Australia. Whether such knowledge is or is not part of the invention is not to be considered in isolation to what the patent defines as the invention.
While the approach adopted in determining the presence (or absence) of an inventive step has differed in recent Federal Court cases, this decision suggests that revocation of patents for lack of inventive step may become somewhat easier in the future. This is particularly true of patents that address a problem to be solved by the use of a known pharmaceutical compound such as rosuvastatin.
Other key cases
Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd  FCAFC 62
The Full Court of the Federal Court of Australia considered whether Apotex had engaged in indirect or contributory infringement of a patent held by Sanofi-Aventis, claiming a method of treating psoriasis. The Court held that there was contributory infringement because Apotex’s disclaimer gave rise to a ‘reasonable belief’ that the product might be used to treat psoriasis. The matter will now be considered by the High Court following an appeal by Apotex on this issue.
Bradken Resources Pty Ltd v Lynx Engineering Consultants Pty Ltd (No. 2)  FCA 1478
This Federal Court decision considered the issue of whether prior use, having an element of commerciality, could be still considered ‘reasonable trial’ of an invention. It was ultimately held that use of an invention having a commercial aspect may still amount to use “for the purposes of reasonable trial or experiment only”, which does not disqualify or invalidate the patent.
Otsuka Pharmaceutical Co Ltd v Generic Health Pty Ltd  FCA 239
Otsuka sought an interlocutory injunction to restrain Generic Health from releasing a generic product, pending an infringement action for alleged breach of Otsuka’s patent. Justice Yates held that two statutory grounds of contributory infringement could be established, and considered that the balance of convenience favored Otsuka, given their susceptibility to suffer from the mandatory price reductions on generic products.
Novartis AG v Hospira Pty Ltd  FCA 1055
This case involved yet another application for an interlocutory injunction to restrain an alleged infringer from launching its own generic product. Justice Yates found that although it was clear that Novartis’ patents were invalid, and therefore a prima facie case for infringement was not established, Hospira also failed to establish that the prior art anticipated Novartis’ patents. As a result, the injunction was allowed in view of the fact that Novartis was more likely to suffer from a change in the status quo if Hospira did enter into the market.
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Paul Mallon – T +61 8 9213 8312 / email@example.com
Nick Stamatiou – T +618 9213 8343 / firstname.lastname@example.org
Wayne Condon – T +61 3 9243 8344 / email@example.com
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Kellie Stonier – T +61 7 3232 1719 / email@example.com
  FCAFC 6.
 Danisco A/S v Novozymes A/S (No. 2) FCA 282 at .
  FCAFC 70.
 H Lundbeck A/S v Alphapharm Pty Ltd  FCAFC 70 at .
  FCA 120.
 Danisco A/S v Novozymes A/S (No. 2) FCA 282.
 Albany Molecular Research Inc v Alphapharm Pty Ltd  FCA 120 at [33-36].
 Novozymes A/S v Danisco A/S  FCAFC 6.
 The General Tire and Rubber Co v The Firestone Tyre and Rubber Co Ltd  RPC 457.
 Ibid., at [485-486].
  FCA 162.
 Apotex Pty Ltd v AstraZeneca AB (No. 4)  FCA 162 at .
 Note, a geographical limitation on common general knowledge no longer applies since the Intellectual Property Laws Amendment (Raising the Bar) Act 2012.