Written by Tim Fitzgerald* and Michael Finney**
‘Swiss format’ or ‘Swiss-type’ patent claims have a general structure similar to the following:
Use of compound X in the manufacture of a formulation for the treatment of medical condition Y.
Swiss-type claims were originally approved by the Swiss Patent Office as a mechanism to allow for protection of a new therapeutic use of a known compound (i.e., second or further medical use), given prohibition of claims to methods of medical treatment.[1] The claim format was subsequently accepted at the European Patent Office (EPO) and affirmed in the Enlarged Board of Appeal decision G05/83. In particular, the Enlarged Board held that it was “legitimate in principle” to allow Swiss-type claims where the formulation was for a specified new and inventive therapeutic application, even where the process of manufacture did not differ from known processes using the same active ingredient.
Under the provisions of the Convention on the Grant of European Patents 2000 (EPC 2000), claims in the format “Compound X for use in treating condition Y” (‘European use format’) are construed as use-limited for novelty purposes, and Swiss-type claims are no longer allowable in Europe.[2] Nevertheless, previously issued European patents containing Swiss-type claims have the potential to remain in force until at least 2031.[3] In recent years, there has been substantial judicial assessment of infringement requirements for Swiss-type claims of existing European patents, including in the UK.[4]
In Australia, claims to methods of medical treatment are permissible[5] and, accordingly, Swiss-type claims are not necessary to achieve protection for new uses of a known therapeutic. Nevertheless, Swiss-type claims have long been considered acceptable under Australian patent office practice. Notwithstanding this, for many years Swiss-type claims went largely without judicial consideration in Australia. Since 2015, however, several Australian decisions have issued which provide clarification of the role of Swiss-type claims in Australia. Here we provide a high-level overview of applicable findings within these decisions, and conclude with a summary of current Australian law regarding Swiss-type claiming.
Otsuka Pharmaceutical Co., Ltd v Generic Health Pty Ltd (No 4) [2015] FCA 634 (‘Otsuka’)
In Otsuka, a decision of the Federal Court of Australia, a single judge (Justice Yates) provided the first detailed judicial consideration of Swiss-type claims in Australia. As a key element of the decision, His Honour considered whether Swiss-type claims should be construed as method claims or product claims, and concluded that the subject matter of a Swiss-type claim is “appropriately characterised as method or process“.[6] His Honour also prima facie accepted, although did not actively decide upon, established Australian patent office practice that novelty can be conferred for Swiss-type claims by the therapeutic use recited in the claim.
Justice Yates’ also expressed an obiter opinion in Otsuka in relation to infringement of Swiss-type claims. His Honour’s stated position was that the manufacturer of the composition would be the direct infringer of a Swiss-type claim, which again accorded with prior assumptions under Australian practice. However, his Honour went on to comment that, in determining infringement of Swiss-type claims,
[t]he question is whether, objectively ascertained, the medicament that results from the claimed method or process is one that has the therapeutic use defined in the claim“.[7]
His Honour further noted that
[t]he question is not really about how the alleged infringer markets its product, although, plainly, its conduct in that regard may well assist in determining, objectively, whether the accused product has the claimed therapeutic use“.[8]
His Honour’s obiter comments on infringement requirements were interpreted by some commentators as suggesting that a product will infringe a Swiss-type claim so long as it has therapeutic use that falls within the scope of the claims, regardless of the intended use of the product. In conjunction with His Honour’s acceptance of the proposition that Swiss-type claims can achieve novelty based on the recited therapeutic use, this could be seen to lead to a confounding result. Specifically, under these circumstances, a Swiss-type claim reciting a new use could be granted for a previously known composition, with the known composition then infringing the claim by virtue of it being effective for the new use. It appeared unlikely that His Honour had intended for such a result. Accordingly, after Otsuka, some commentators (including the writers) called for clarification of the role of intended use of the manufactured product for the infringement of Swiss-type claims, noting that similar issues had (at that time) recently been judicially addressed in the UK.[9]
Apotex Pty Ltd v Warner-Lambert Company LLC (No 3) [2017] FCA 94 (‘Apotex’)
As for Otsuka, Apotex was an Australian Federal Court decision issued by a single judge (Justice Nicholas). In Apotex, Justice Nicholas was asked to consider whether an offer made, during the term of a patent, to supply infringing products after patent expiry, would itself constitute infringement of the patent. Relevantly, the patent in question (AU 714980) contained both an independent method of medical treatment claim and a corresponding independent Swiss-type claim. Accordingly, His Honour assessed the question for each of these respective claim types.
Justice Nicholas noted that, under Australian law, it is an infringement of a patent claim to “exploit” the claimed invention within Australia during the term of the patent, and that Schedule 1 of the Patents Act 1990 (Cth) (henceforth, ‘the Patents Act’) defines “exploit” to include:
(a) where the invention is a product – make, hire, sell or otherwise dispose of the product, offer to make, sell, hire or otherwise dispose of it, use or import it, or keep it for the purpose of doing any of those things; or
(b) where the invention is a method or process – use the method or process or do any act mentioned in paragraph (a) in respect of a product resulting from such use.
In relation to the method of medical treatment claims, His Honour concluded that the method did not result in the making of any product, and therefore the reference in paragraph (b) to “any act mentioned in paragraph (a) in respect of a product resulting from such use” meant that the paragraph (b) provisions could not apply to this method of treatment claim. However, in relation to the Swiss-type claims, His Honour identified that the method results in the production of a product (a manufactured medicament), and that part (b) of the definition of “exploit” is applicable. With this in mind, His Honour concluded that the definition of “exploit” under the Patents Act encompasses an offer made, during the term of the patent, to supply a product manufactured according to a Swiss-type claim after patent expiry, and that the Swiss-type claim had therefore been infringed.
The decision in Apotex has confirmed that there can be clear benefits of including Swiss-type claims in Australian patents. Importantly, this decision establishes that Swiss-type claims can offer a broader scope of protection than corresponding method of medical treatment claims, at least in relation to commercial offers by third parties.
Commissioner of Patents v AbbVie Biotechnology Ltd [2017] FCAFC 129 (‘AbbVie’)
In AbbVie, three judges of the Australian Federal Court heard an appeal from a decision of the Australian Administrative Appeals Tribunal (AATA).[10] AbbVie dealt with a highly specific aspect of Australian law, relating to the possibility of relying on Swiss-type claims to obtain an extension of term for pharmaceutical patents.
Relevantly, Subsection 70(2) of the Patents Act deals with pharmaceutical patent extensions, and defines that a patent relating to a pharmaceutical substance may have its term extended by up to five years, where one or both of the following apply:
(a) one or more pharmaceutical substances per se must in substance be disclosed in the complete specification of the patent and in substance fall within the scope of the claim or claims of that specification;
(b) one or more pharmaceutical substances when produced by a process that involves the use of recombinant DNA technology, must in substance be disclosed in the complete specification of the patent and in substance fall within the scope of the claim or claims of that specification.
In this case, AbbVie Biotechnology Ltd had applied for extensions of term for three Australian patents (AU 2012261708; AU 2013203420; AU 2013257402) on the basis of the inclusion of Swiss-type claims reciting a pharmaceutically active substance which is routinely produced by a recombinant DNA process (although this was not stated in the claim), attempting to rely on (b), above. The Australian Commissioner of Patents had originally found that the Swiss-type claims were not valid basis for the requested extensions, however this decision had been overturned by the AATA.
The Full Court overturned the findings of the AATA, and reverted to the original position of the Commissioner of Patents. In doing so, the Full Court approved the determination in Otsuka, supra, that Swiss-type claims are method or process claims, not product claims. The Full Court elaborated that such claims are directed to methods of manufacturing a formulation or medicament using an active substance, not to the formulation or the active substance itself. On this basis, the Full Court decided that the active pharmaceutical substance recited in the Swiss-type claims, while produced by recombinant DNA technology, did not “fall within the scope” of these claims, and that the circumstances as per subsection 70(2)(b) of the Patents Act were therefore not met.
AbbVie appears to clearly establish that Swiss-type claims cannot be relied upon for term extension of pharmaceutical patents in Australia. More broadly, the Full Court’s decision appears to clarify that, even in the case of subsection 70(2)(b) of the Patents Act, a pharmaceutical substance itself (as compared to a method involving the substance) must be claimed in order for an extension to be obtained.
Apotex v ICOS Corporation (No 3) [2018] FCA 1204 (‘ICOS’)
Among a number of other considerations in ICOS, a single Federal Court judge (Justice Besanko) was asked to assess whether importation into Australia of an infringing product, wherein the product was manufactured outside of Australia, could result in infringement of a Swiss-type claim directed to manufacture of the product. With reference to the definition of “exploit” as per Schedule 1 of the Patents Act (set out above), Justice Besanko concluded that such circumstances would represent importation of a product produced according to a claimed method as per part (b) of the definition, and could indeed constitute infringement.
Given that pharmaceuticals sold in Australia are frequently manufactured overseas prior to importation, Justice Besanko’s ruling would appear to be of substantial practical relevance. That is, if the scope of Swiss-type claims had been found to exclude use of products that have been imported into Australia after being manufactured elsewhere, a large proportion of Australian pharmaceuticals would escape infringement of these claims on that basis alone.
Mylan Health (formerly BGP) v Sun Pharma (formerly Ranbaxy) [2019] FCA 28 (‘Mylan’)
Nearly four years after Justice Yates’ obiter comments in Otsuka, discussed above, Justice Nicholas provided the first formal consideration of the requirements for Swiss-type claim infringement in Australia, in the Federal Court decision of Mylan. His Honour was required to determine whether sale in Australia of a pharmaceutical composition with suitable properties for use as recited in a Swiss-type claim would infringe the Swiss-type claim.
In arriving at his decision, Justice Nicholas was guided by their Lordships’ observations in the UK Supreme Court decision Warner Lambert Company LLC v Generics (UK) Ltd [2018] UKSC 56 (‘Warner Lambert’) which had issued the previous year. In particular, His Honour accepted that Swiss-style claims should be construed as use-limited both for novelty and infringement purposes, where the scope of such claims relates to the therapeutic use to which the formulation is applied. That is, the monopoly claimed was considered to relate to manufacture of a pharmaceutical composition for treatment of a particular medical condition. His Honour further accepted that, in determining infringement of a Swiss-type claim, the intent of the manufacturer is relevant. That is, for a Swiss-type claim to be infringed, it must be established that a manufacturer intended for the composition to be used for the recited condition.
Justice Nicholas elaborated on the concept of intent, drawing further from Warner Lambert in discussing concepts of “objective intent” and “subjective intent” of a manufacturer. His Honour explained that assessing subjective intent would require establishing the state of mind of the manufacturer and whether, in fact, the manufacturer had produced the product for the purpose recited in a Swiss-type claim. His Honour explained that, in contrast, assessment of objective intent would be performed using a legal framework to decide, under all of the circumstances, if it should be considered that the product had been produced for the recited purpose, whether or not this was consistent with the manufacturer’s actual state of mind.
In Mylan, whether an objective or subjective approach was adopted, Justice Nicholas concluded that the evidence presented would be insufficient to support a finding of intent for infringement purposes. Accordingly, His Honour did not believe it was necessary to determine which approach to establishing intent was correct, although His Honour appeared to favour an objective approach.[11] It is further relevant to note that, in regard to establishing objective intent, His Honour stated, obiter, that relevant considerations could include .
approved product information (“PI”) for the product, any product labelling, and the nature, size and other pertinent characteristics of the market into which the product is to be sold“[12]
and that
[t]he fact that it may be reasonably foreseeable or even likely that a substantial portion of the product manufactured will be used to treat that condition is certainly not determinative at least not where the product is also used extensively in the treatment of other non-designated conditions.”[13]
These comments indicate that His Honour’s characterisation of objective intent differs from that discussed in Warner Lambert. Indeed, Justice Nicholas’ concept of objective intent appears to incorporate elements of the “outward presentation test” propounded by Lord Sumption in Warner Lambert,[14] which was considered a separate test in that decision.
At the time of writing, Mylan has been appealed to the Full Federal Court, including in relation to infringement of the Swiss-type claims. Furthermore, while awaiting the outcome of this appeal, interim injunctive relief was applied for.[15] Interestingly, the application for injunctive relief was heard by Justice Yates, responsible for the decision in Otsuka, which provided an opportunity for His Honour to elaborate on his obiter comments on infringement of Swiss-type claims in that case.
Essentially, Justice Yates noted that, in Mylan, Justice Nicholas had addressed the issue of intent with the benefit of the UK Supreme Court decision in Warner Lambert, and did not actively push back against Justice Nicholas’ finding that a manufacture’s intention in relation to therapeutic use of a product was relevant to infringement of Swiss-type claims.[16] Accordingly, Mylan appears to establish that intent is indeed relevant to infringement of Swiss-type claims. However, the question of how to determine intent, in particular whether an objective or subjective approach should be used,[17] remains open. The outcome of the Full Federal Court appeal is expected to provide further guidance in this respect.
Summary
As at writing, precedent is available in Australia for several significant issues relating to Swiss-type claims. Critically, there appears to be agreement among all decisions issued that Swiss-type claims can be validly included within Australian patents; that these claims should be construed as method or process claims; and that the therapeutic use recited in a Swiss-type claim can confer novelty.
It has also been confirmed, in Apotex Pty Ltd v Warner-Lambert Company LLC (No 3) [2017] FCA 94, that the scope of a Swiss-type claim will differ from that of a corresponding method of medical treatment claim. Relevantly, at least in respect of third party offers to supply products after the expiry date of a patent, Swiss-type claims can offer broader protection than method of medical treatment claims.
The potential for Swiss-type claims to be relied upon for pharmaceutical patent extension has also been judicially assessed, in Commissioner of Patents v AbbVie Biotechnology Ltd [2017] FCAFC 129. It has been clearly established that such extensions cannot be obtained on the basis of Swiss-type claims, regardless of whether an active agent used in manufacture of the therapeutic composition is produced using recombinant DNA technology.
Furthermore, Apotex v ICOS Corporation (No 3) [2018] FCA 1204 has provided clarification that infringement of Swiss-type claims of an Australian patent does not necessarily require manufacture in Australia. This is of substantial practical consequence given that pharmaceutical products are commonly imported into Australia after manufacture overseas.
Finally, Mylan Health (formerly BGP) v Sun Pharma (formerly Ranbaxy) [2019] FCA 28 provides initial precedent establishing that infringement of Swiss-type claims requires relevant intent on behalf of a manufacturer in relation to therapeutic use of a manufactured product. The outcome of an appeal from this decision is expected to further clarify how intent is to be established, i.e., using subjective and/or objective approaches.
Of course, there will remain some uncertainty regarding the proper judicial approach to Swiss-type claims in Australia absent determinations by the High Court. Nevertheless, decisions issued over the last five years have vastly increased the available judicial precedent in this area of patent law.
[1] Official Journal of the European Patent Office (1984) 11: 581-584.
[2] See, EPO Guidelines for Examination G-VI, 7.1.
[3] Or 2036 under Supplementary Protection Certificate provisions.
[4] Including the UK Supreme Court decision in Warner Lambert Company LLC v Generics (UK) Ltd t/a Mylan and another [2018] UKSC 56.
[5] Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd [2013] HCA 50. As are claims to therapeutics in ‘when used’ format, which have essentially the same scope as method claims, see Wellcome Foundation Ltd v Commissioner of Patents (1980) 145 CLR 520.
[6] With no useful distinction existing between the descriptors “method” and “process”, in the context of patent claiming. Otsuka at [120].
[7] Ibid at [172].
[8] Ibid.
[9] Warner-Lambert Company, LLC v Actavis Group Ptc EHF & Others [2015] EWHC 72.
[10] Re AbbVie Biotechnology Ltd v Commissioner of Patents [2016] AATA 682.
[11] Mylan at [102].
[12] Ibid.
[13] Ibid at [103].
[14] Warner Lambert at [84].
[15] Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd (No 2) [2019] FCA 505.[16] Ibid at [86].[17] And any relevance of “outward presentation” as per 14, above, in this context.
* Dr. Fitzgerald is a Senior Registered Patent & Trade Marks Attorney with IP Gateway Patent and Trade Mark Attorneys.
** Mr. Finney is a Senior Associate of Bennett & Philp Lawyers.
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