Generics (UK) Ltd v Daiichi Pharmaceutical Co Ltd & Anor

This appeal is from a judgment of Kitchin J, [2008] EWHC 2413 (Pat), of 15^th October 2008. He held that Daiichi’s by then expired patent EP (UK) No. 0206283 was valid and that the supplementary protection certificate based on it no. SPC/GB97/085 (“the SPC”) was also valid.

Before Kitchin J validity of the patent was attacked on a mass of grounds: lack of novelty over Daiichi’s earlier patent EP 0,047,005 and/or Drugs of the Future and/or a Bayer patent application (this point took the form of a dispute about the priority date of the Patent, for if priority was lost, Bayer anticipated), obviousness over either of the first two of those citations or over at least one of four further prior disclosures (about one of which there was an issue of availability to the public), added matter and insufficiency. A total of 9 attacks which, with the sub-issue of availability, gave the Judge 10 issues relating to validity to decide.

Perhaps eventually realising that a court is unlikely to be impressed where a party takes masses of points (the natural initial and strong impression is that the party does not feel it has a real killer) the appellants (“GUK”) confine their appeal on validity of the patent to a single point, obviousness over “Gerster IP”. This was a poster which had been displayed for a couple of hours by a Dr Gerster in a Symposium in Toronto in 1982, some three years before the priority date. They also appeal on the SPC point. So we have two points before us, obviousness over Gerster IP and the validity of the SPC. If the patent was invalid, there could be no valid SPC; if it was valid, there could, but only if the criteria for an SPC were satisfied.

We turn first, therefore, to validity of the patent. It is for a chiral antimicrobial compound called levofloxacin, the name of the S(-) enantiomer of a compound whose racemic form is known as ofloxacin. (For anyone coming for the first time to the basic science and terminology of stereochemistry, a good explanation is to be found in [12-15] of Kitchin J’s judgment in Generics v Lundbeck, [2007] EWHC 1040 (Pat), [2007] RPC 729).

The structure of levofloxacin looks like this:

Claim 2 of the Patent (the only claim we have to consider) is to levofloxacin. It is common ground that the claim does not extend to ofloxacin – such would be an absurd construction given the fact that the patent acknowledges that ofloxacin is old, having been disclosed in the ‘005 patent (see how Kitchin J dealt with an identical point in the Lundbeck case at [51-64], upheld in this court, [2008] EWCA Civ 311 at [8-13] per Lord Hoffmann and at [50] per Jacob LJ – the point did not arise in the House of Lords, [2009] UKHL 12, [2009] RPC 407).

I turn to set out matters which were always uncontroversial or are now unchallenged on appeal.

Ofloxacin was a known compound in 1985. It was disclosed in the ‘005 patent along with a way of making it. The patent says nothing about chirality and the method of synthesis disclosed produces the racemic compound.

Ofloxacin is a member of the class of compounds called quinolones. The Judge sets out their structures at [41-43] and there is no need to repeat that here. For present purposes it is sufficient to note that at the priority date, “a large number of quinolones of very different structures had been shown to display antibacterial activity” (Judgment [44). The Judge describes the history in helpful detail at [55-81]. It is sufficient to record the following findings of the Judge:

So the general position was, as the judge found:

[110] Overall, I think a relatively clear picture emerges. The quinolone field was unusual in that workers recognised the need for and perceived an opportunity to discover new chemical entities of ever greater efficacy. The discovery of norfloxacin, ofloxacin and ciprofloxacin put great pressure on researchers to identify new quinolones having even better bacterial profiles. It was here their energies were primarily directed. Hundreds of chemists were making new compounds each year and, not surprisingly, they would opt not to make a compound if its synthesis was difficult. Compounds which were difficult to make would get a low priority in the laboratory. This was not an environment conducive to the investigation of stereochemistry. Resolution of a racemate might result in a twofold increase in activity, at best, and it could be a good deal worse. It was quite possible that activity might lie more in one enantiomer than the other, but not greatly so. Moreover, resolution might prove very difficult to achieve. As a result, for many chemists, including those at Sterling-Winthrop, I am satisfied that resolution of racemates was something that would simply not have occurred to them at all. For others, it plainly did. But it was not a routine path to follow and, for the ordinary chemist, I believe it was something which he might well not have considered and, if he did, then it would not have been a high priority, absent some particular reason for doing so.

GUK do not challenge any of that. Nor do they challenge the finding that stereochemistry was not discussed at the time in any of the major review articles about quinolones – a good indication of the skilled workers’ lack of interest in stereochemistry. There were potentially richer pickings to be had in the field of new compounds than in the field of stereoisomers.

By 1985 flumequine was not considered important. It had been overtaken by other quinolones, including ofloxacin and particularly ciprofloxacin. The Judge put Prof. Wentland’s view this way:

[167] … It must be remembered that flumequine had been known since 1973 and was recognised as an important advance as of that time. However, by 1985, its properties were considered unexceptional and it had made only limited progress as a human therapeutic. Consequently it was no longer an influential compound.

At [170] the Judge said he preferred that view to that of GUK’s expert, Dr Spargo – perhaps hardly surprising since Dr Spargo was not only not in the quinolone field at the time (he was just completing his PhD) but he never became a quinolone man later, whereas Prof Wentland was, both in 1985 and thereafter, such a man.

Moreover it was the view of Prof. Wentland, accepted by the Judge, that:

flumequine and ofloxacin were different compounds and that the medicinal chemist could not take information from one to the other [169]

By 1985 ofloxacin was of some importance for it was in that year it received regulatory approval. It was of more interest then than in 1982 when the Gerster IP poster was briefly displayed in Toronto. But it was not as important as ciprofloxacin.

Generally if one wanted a pure enantiomer of a chiral compound, there were a number of general methods known. These might or might not work. The Judge describes them at [92-97]. A starting point would be to attempt a resolution from the racemate itself. As the Judge put it at [140] in the context of ofloxacin:

all the experts agreed that the obvious starting point would have been ofloxacin itself. Dr Spargo accepted this would have been the skilled person’s ‘first port of call’. Dr Newton agreed with Professor Davies that if the final product was available and could be made then typically the skilled person would try and resolve that first.

It was not GUK’s case that resolution from the final product could be readily achieved. So the skilled man would find, on investigation, that the “first port of call” was closed to him.

In 1985 the incentive to investigate the enantiomers of ofloxacin was limited. So the incentive to obtain them was correspondingly limited. The Judge found the position to be as follows:

[139] … Weighing the evidence as a whole against the background of the common general knowledge, I have reached the conclusion that by 1985 the skilled person would have been aware of the particular promise of ofloxacin as a pharmaceutical and its chiral nature. It was possible one enantiomer might have more activity than the other and that it would retain the other beneficial qualities of the racemate. Accordingly I believe he would have considered it worthwhile exploring whether ofloxacin could be resolved, but only to a point. I do not believe it was a goal that it was obvious to pursue relentlessly. The benefit in terms of activity might be relatively limited and it would have been recognised that resolution might be difficult or impossible to achieve. Moreover, the pharmacokinetics of a more active enantiomer would be unlikely to be better than those of the racemate and it might well be more toxic. It would also be susceptible to the development of resistance. By contrast, new molecules had the potential to be a good deal more active than ofloxacin and ciprofloxacin and I am satisfied the primary goal of those in the industry was to find them. Accordingly, I think it was obvious to investigate whether the enantiomers of ofloxacin could be separated relatively easily. If they could not, then I believe the skilled person would have redirected his efforts elsewhere, just as Professor Wentland explained workers would tend to avoid molecules they thought would be difficult to make. There were many other, potentially much more fruitful, avenues to explore.

The law of obviousness

There is at bottom only one test, namely that posed by Art. 56 of the EPC transposed into UK law by s.3 of the Patents Act 1977. Was the invention obvious to a person skilled in the art having regard to any matter which forms part of the state of the art? Judicial or patent office attempts to formulate the test in other words, or to provide a formula, can be helpful, provided that one does not lose sight of the statutory question. One must not take any such other test or formula as if it were the statute – they are only tools for answering the statutory question. Adherence to any rigid formula can be a mistake.

In our courts we have found it helpful to approach the problem via what are now known as the Windsurfing/Pozzoli questions. They are:

(1)

(a) Identify the notional "person skilled in the art".

(b)

Identify the relevant common general knowledge of that person.

(2)

Identify the inventive concept of the claim in question or, if that cannot readily be done, construe it.

(3)

Identify what, if any, differences exist between the matter cited as forming part of the "state of the art" and the inventive concept of the claim or the claim as construed.

(4)

Ask whether, when viewed without any knowledge of the alleged invention as claimed; do those differences constitute steps which would have been obvious to the person skilled in the art or do they require any degree of invention?

Some have seen this as a peculiarly English test. But I do not think it is. It is no more than a structure by which the question, obvious or not, is to be approached. The first three steps do no more than put the court in the right state to answer that question. They are necessary inherent preliminary matters to be determined before one can properly set about answering the fourth question. Implicitly I think all courts (and patent offices) do and must do the same. The approach in the Windsurfing/Pozzoli way merely makes explicit that which is implicit. The value of doing this is that it makes one focus on each key element properly – just what are the attributes and knowledge of the notional skilled person, what exactly are the differences between the prior art and the invention and so on? In this case for instance it helps direct attention at the common general knowledge of the notional person skilled in the art – see below.

Some have suggested that Pozzoli/Windsurfing is different from the EPO’s problem/solution approach. It is not. The problem/solution approach only applies at stage four.The first three stages must be carried out at least implicitly as much for the problem/solution approach as for any other.

As far as the fourth question is concerned, no formula (“obvious to try” or “problem/solution”) can be a perfect substitute for the statutory test. Nonetheless a formula can sometimes be useful. Here reliance is placed on “obvious to try”. This has been considered recently by the House of Lords. In Conor v Angiotech [2008] UKHL 49. Lord Hoffmann said at [42]:

“In the Court of Appeal, Jacob LJ dealt comprehensively with the question of when an invention could be considered obvious on the ground that it was obvious to try. He correctly summarised the authorities, starting with the judgment of Diplock LJ in Johns-Manville Corporation's Patent [1967] RPC 479, by saying that the notion of something being obvious to try was useful only in a case in which there was a fair expectation of success. How much of an expectation would be needed depended upon the particular facts of the case. As Kitchin J said in Generics (UK) Ltd v H Lundbeck A/S [2007] RPC 32 , para 72:

“The question of obviousness must be considered on the facts of each case. The court must consider the weight to be attached to any particular factor in the light of all the relevant circumstances. These may include such matters as the motive to find a solution to the problem the patent addresses, the number and extent of the possible avenues of research, the effort involved in pursuing them and the expectation of success.””

The Judge applied that here. He cannot be criticised for doing so. Mr Michael Tappin QC (who argued the obviousness point for GUK) reminded us of what Laddie J said in Brugger v.Medic-Aid [1996] R.P.C. 635 at 661 line 6 approved in this court in Palmaz’s Patents [2000] RPC 631.

“Secondly, if a particular route is an obvious one to take or try, it is not rendered any less obvious from a technical point of view merely because there are a number, and perhaps a large number, of other obvious routes as well. If a number of obvious routes exist it is more or less inevitable that a skilled worker will try some before others. The order in which he chooses to try them may depend on factors such as the ease and speed with which they can be tried, the availability of testing equipment, the costs involved and the commercial interests of his employer. There is no rule of law or logic which says that only the option which is likely to be tried first or second is to be treated as obvious for the purpose of patent legislation.”

That is of course uncontroversial – but it does not mean that a skilled man will pursue every avenue relentlessly when he has only the mildest of motives for doing so. The important point is that this passage only comes into play when “a particular route is an obvious one to take or try.” And it is only obvious to try when there is at least a fair expectation of success. Moreover it has to be a route which would at least occur to the skilled person – a point of particular relevance here.

The test for this is well established. The Judge cited from Beloit v Valmet [1997] RPC 489 at pp.494-495:

“It has never been easy to differentiate between common general knowledge and that which is known by some. It has become particularly difficult with the modern ability to circulate and retrieve information. Employees of some companies, with the use of libraries and patent departments, will become aware of information soon after it is published in a whole variety of documents; whereas others, without such advantages, may never do so until that information is accepted generally and put into practice. The notional skilled addressee is the ordinary man who may not have the advantages that some employees of large companies may have. The information in a patent specification is addressed to such a man and must contain sufficient details for him to understand and apply the invention. It will only lack an inventive step if it is obvious to such a man.

It follows that evidence that a fact is known or even well-known to a witness does not establish that that fact forms part of the common general knowledge. Neither does it follow that it will form part of the common general knowledge if it is recorded in a document. As stated by the Court of Appeal in General Tire & Rubber Co. v. Firestone Tyre & Rubber Co. Ltd. [1972] R.P.C. 457, at page 482, line 33:

‘The two classes of documents which call for consideration in relation to common general knowledge in the instant case were individual patent specifications and widely read publications'. As to the former, it is clear that individual patent specifications and their contents do not normally form part of the relevant common general knowledge, though there may be specifications which are so well known amongst those versed in the art that upon evidence of that state of affairs they form part of such knowledge, and also there may occasionally be particular industries (such as that of colour photography) in which the evidence may show that all specifications form part of the relevant knowledge’.

As regards scientific papers generally, it was said by Luxmoore J. in British Acoustic Films (53 R.P.C. 221 at 250):

‘In my judgment it is not sufficient to prove common general knowledge that a particular disclosure is made in an article, or series of articles, in a scientific journal, no matter how wide the circulation of that journal may be, in the absence of any evidence that the disclosure is accepted generally by those who are engaged in the art to which the disclosure relates. A piece of particular knowledge as disclosed in a scientific paper does not become common general knowledge merely because it is widely read, and still less because it is widely circulated. Such a piece of knowledge only becomes general knowledge when it is generally known and accepted without question by the bulk of those who are engaged in the particular art; in other words, when it becomes part of their common stock of knowledge relating to the art.’”

Mr Tappin raised what he said was a point of law about the extent of knowledge of a person skilled in the art. He relied on what Laddie J said in Raychem’s Patent [1998] RPC 31 at 40, approved on appeal at [1999] RPC 497 at 503:

“The common general knowledge is the technical background to the notional man in the art against which the prior art must be considered. This is not limited to material he has memorised and has at the front of his mind. It includes all that material in the field he is working in which he knows exists, which he would refer to as a matter of course if he cannot remember it and which he understands is generally regarded as sufficiently reliable to use as a foundation for further work or to help understand the pleaded prior art. This does not mean that everything on the shelf which is capable of being referred to without difficulty is common general knowledge nor does it mean that every word in a common text book is either. In the case of standard textbooks, it is likely that all or most of the main text will be common general knowledge. In many cases common general knowledge will include or be reflected in readily available trade literature which a man in the art would be expected to have at his elbow and regard as basic reliable information. In this case, for example, the general technical discussion of conductive polymers in the Cabot technical report was common general knowledge well before the priority date. So too would be the general teaching in the leading articles and textbooks on the subject”.

Of course material readily and widely to hand can be and may be part of the common general knowledge of the skilled person – stuff he is taken to know in his head and which he will bring to bear on reading or learning of a particular piece of prior art. But there will be other material readily to hand which he will not carry in his head but which he will know he can find if he needs to do so (my emphasis). The whole passage is about material which the skilled man would refer to “as a matter of course.” It by no means follows that the material should be taken to be known to the skilled man if he has no particular reason for referring to it.

Kitchin J, having reviewed Raychem and other authorities, said this:

“[40] It seems to me that a subtle but potentially significant point of principle emerges from these passages. I can readily accept that, faced with a disclosure which forms part of the state of the art, it may be obvious for the skilled person to seek to acquire further information before he embarks on the problem to which the patent provides a solution. But that does not make all such information part of the common general knowledge. The distinction is a fine one but it may be important. If information is part of the common general knowledge then it forms part of the stock of knowledge which will inform and guide the skilled person’s approach to the problem from the outset. It may, for example, affect the steps it will be obvious for him to take, including the nature and extent of any literature search”.

I agree with that although I personally do not find the point of principle “subtle”. It would be wholly subversive of patents and quite unfair to inventors if one could simply say “piece of information A is in the standard literature, so is B (albeit in a different place or context), so an invention consisting of putting A and B together cannot be inventive.” The skilled man reads each specific piece of prior art with his common general knowledge. If that makes the invention obvious, then it does. But he does not read a specific citation with another specific citation in mind, unless the first causes him to do so or both are part of the matter taken to be in his head.

So, for example, if a particular device depends upon expansion of a metal, say brass, and clearly the coefficient of expansion matters to its operation, one can legitimately say that the skilled person knows there are tables of coefficients of expansion and would go to them to see what other metals or alloys had similar coefficients and would therefore probably work. But not so if it was far from evident that the coefficient of expansion mattered.

These are well-known, having been laid down by Lord Hoffmann in Biogen v Medeva [1997] RPC 1 at p.45:

“The need for appellate caution in reversing the judge’s evaluation of the facts is based upon much more solid grounds than professional courtesy. It is because specific findings of fact, even by the most meticulous judge, are inherently an incomplete statement of the impression which was made upon him by the primary evidence. His expressed findings are always surrounded by a penumbra of imprecision as to emphasis, relative weight, minor qualification and nuance (as Renan said, la vérité est dans une nuance), of which time and language do not permit exact expression, but which may play an important part in the judge’s overall evaluation. It would in my view be wrong to treat Benmax as authorising or requiring an appellate court to undertake a de novo evaluation of the facts in all cases in which no question of the credibility of witnesses is involved. Where the application of a legal standard such negligence or obviousness involves no question of principle but is simply a matter of degree, an appellate court should be very cautious in differing from the judge’s evaluation”.

The Obviousness Case

The obviousness attack is now confined to Gerster IP. Originally cited was a document called Gerster I, an abstract from the proceedings at that conference. To understand the attack and the judge’s judgment it is necessary to say something about this. The disclosure of Gerster I was summarised by the judge:

[161] Gerster I explains that the Riker group designed the tricyclic structure of flumequine to study how bacterial activity would be affected by restricting the free rotation of the N-ethyl group present in many of the quinolones under development at the time. They noted that an asymmetric centre was created and explained that they had succeeded in preparing both optical isomers. They found that one isomer had potent antibacterial activity and the other only very weak activity. They also prepared the simpler desmethyl achiral analogue and showed that it had less antibacterial activity than flumequine but was more active than the weakly active isomer.

Gerster I did not disclose how the isomers of flumequine had been prepared. But Gerster IP did. To understand why the judge rejected obviousness over the latter, it is first necessary to see why he rejected obviousness over the former, for it feeds into the latter.

The case on Gerster I was that flumequine and ofloxacin were both chiral tricyclic quinolones. Side by side their structures look like this:

So, given that the enantiomers of flumequine were disclosed as having markedly different properties from each other, one would be led to investigate whether the same was true for ofloxacin. You could find out how to make this, and then resolve it in order to do so.

The Judge rejected this case. He said:

[170] Weighing this evidence and taking care to avoid the dangers of hindsight as I must, I prefer the evidence of Professor Wentland and Professor Davis. Consequently I do not consider Gerster I would have rendered it obvious to the skilled person to take any step it would not already have been obvious for him to take in the light of his knowledge of ofloxacin. As I have found, by 1985 he would have been aware that ofloxacin had a chiral centre and comprised two enantiomers. He would also have appreciated that the activity of the two enantiomers might be different and that theoretically all of the activity might lie in one rather than the other. It would also have been apparent to him that there are significant structural differences between flumequine and ofloxacin and that their overall activities are very different, with ofloxacin being a markedly superior molecule. I conclude that these structural differences and the lack of any clear understanding of how the molecules bind to the gyrase target would have rendered it impossible to make a prediction as to the behaviour of the ofloxacin enantiomers on the basis of Gerster I, and the disclosure would not have rendered it obvious to take any step in relation to ofloxacin. Moreover, Gerster I provides no assistance as to how the enantiomers of ofloxacin might be resolved. Accordingly, the allegation of obviousness over Gerster I fails just as it did over the Daiichi publications.

None of that is now challenged. What is said to make all the difference is the extra information contained in Gerster IP. That information is as to how the enantiomers of flumequine were made. It is suggested that the skilled man would recognise that the same method would probably work for ofloxacin, that he would follow this up by experiment and would then find out that it did.

More specifically it is submitted that the skilled person would see a close similarity between the intermediate used for the production of ofloxacin and that used for the production of flumequine:

The Judge rejected that case. In doing so Mr Tappin submits, as he must given the Biogen approach to appeals, that he made an error of principle. What then were the Judge’s reasons for rejecting the attack? He said:

[184] To summarise my conclusions thus far: flumequine was not an influential compound by 1985 and I do not believe that information about its enantiomers disclosed in a poster from 1982 would have been of any real interest to those seeking to develop an improved quinolone some three years later. Further, the significant structural differences and the lack of any clear understanding of how the molecules bind to the gyrase target would have rendered it impossible to make a prediction as to the behaviour of the enantiomers of ofloxacin. Against this background, I must consider whether it would have been obvious to the skilled person to apply the method of resolution described in Gerster IP to ofloxacin. I think the following further matters are relevant. First, on reading the method the skilled person would have seen that an unusual derivatising agent was used, namely N-tosyl-L-prolyl chloride. Second, he would have seen it was reacted with an intermediate, which, on the evidence, is not the first approach the skilled person would take to resolution, which is to seek to resolve the final racemate by making diastereomeric salts. Third, GUK’s case depends upon the skilled person recognising the similarities between 6FTHQ and intermediate (V) in Drugs of the Future. Whilst I accept that the skilled person could find out the method of making ofloxacin in 1985 without undue effort, I am not satisfied that he would have known that method as part of his common general knowledge. Accordingly, it is not established on the evidence how the skilled person would ever have come to compare 6FTHQ and intermediate (V). Fourth, even if the skilled person did come to compare the method of resolving flumequine with the method of making ofloxacin and noticed the similarity between 6FTHQ and intermediate (V), he would also have noticed the differences. As Professor Davies explained, both are anilines which means that the nitrogen to which the resolving agent is to be attached is a poor nucleophile and the position is made worse in the case of intermediate (V) by the presence of the additional oxygen and fluorine atoms. As he maintained under cross examination, it might or might not work and the skilled person would be faced with a huge choice of reactions to try. Moreover, there were other reactions staring the skilled worker in the face, namely those involving diastereomeric salts. Dr Spargo was much more enthusiastic. He thought the skilled person would regard Gerster IP as a strong encouragement, would have every reason to think N-tosyl-L-prolyl chloride would work with intermediate (V) and would give it a try as a reasonable reaction. I should also mention that GUK relied on the fact that Dr Hayakawa apparently made the invention after seeing Gerster II, which provides similar teaching in relation to the flumequine analogue S-25930 which differs in the presence of an extra methyl group.

Mr Tappin, whilst not challenging the opening part of the paragraph, attacked the four reasons given by the judge. I go to each in turn.

The first reason was the “unusual derivatising agent.” Mr Tappin said the judge here overlooked the fact that the skilled man would see from Gerster IP that the agent, N-tosyl-L-prolyl chloride worked for the intermediate for flumequine. So, he said, the fact that the agent was unusual did not matter in context. I do not agree. The use of an unusual agent suggests that there were problems for resolving the flumequine intermediate – otherwise why not use a standard agent? That in turn suggests the chemistry is a bit tricky – making it less predicable that it will work for another intermediate. Moreover because the agent has no track record, one is less likely to predict that it will work generally.

The second reason was that the reaction was on an intermediate whereas the general approach to resolution is to start with the racemate of the final compound and to try and resolve that. Mr Tappin accepted that was so in general. But, he submitted that was so because if one resolves an intermediate, the subsequent reactions to the final product incur a risk of re-racemisation. The skilled person, on reading Gerster IP, would see it did not happen for the flumequine intermediate so his fear of re-racemisation would be removed or at least allayed. Perhaps, but to my mind the reasoning at least potentially smacks of post-invention rationalisation. I do not accept that this was a matter to which the Judge could not properly have regard.

The third reason depends on the submission that the (or at least a) process for making ofloxacin was part of the common general knowledge of the person skilled in the art – for before that person could begin to notice the alleged similarity of the intermediates he has to know of the structures of each. Gerster IP gives him the structure of the intermediate for flumequine, but from where does he get the structure of the intermediate for ofloxacin? Mr Tappin says from his common general knowledge. But the Judge has rejected that on the evidence. There was clearly material on which he could do so – indeed it was not really advanced that the skilled man would just know that structure. The case was that the skilled man could readily find it (eg. from the publication Drugs for the Future) and so it was to be treated as part of his common general knowledge. That is not good enough – there is no reason why the skilled man reading Gerster IP (itself about a compound of little interest) would go off and look up to see how similar the intermediate for flumequine was to the intermediate for ofloxacin.

Moreover, the whole approach depends on the unimaginative skilled man (a) recognising the similarity of the structure of the intermediate and (b) having the wit to draw conclusions from that. That itself involves a level of intuition – of invention.

The fourth reason is about predictability. The Judge clearly accepted Prof. Wentland’s evidence that at best the skilled man, if he got as far as (i) going beyond (or not going to at all) the first port of call (resolution of the final product), (ii) ignoring the unusual nature of the agent, and (iii) carrying the structure of the ofloxacin intermediate in his head, would have no basis for expecting the reaction to work. It might or it might not. And he would have many other possible routes and things to try. I cannot begin to see how the Judge made an error of principle here.

In the end, the Judge having decided that the skilled man “would have considered it worthwhile exploring whether ofloxacin could be resolved, but only to a point”, did not consider that the proposed route was attractive enough. That seems to me to be a perfect example of a Judge properly carrying out the balancing task of forming an overall value judgment which it is so often the task of a first instance Judge to perform. There is no error of principle. The patent, whilst it subsisted, was valid.

I am not sorry to reach this conclusion. Daiichi’s work led to a better medicine than ofloxacin. Levofloxacin is not just twice as active as ofloxacin (which might have been expected) but is a lot more soluble and less toxic than was predictable. It can be used in higher dosages than might have been expected with corresponding medical benefit. Only a curmudgeon would say there was no invention here.

So from the point of view of patent law levofloxacin was a new product. And it was a new product as a matter of commercial and practical reality too – no-one, without the invention, could make it. And from the medical point of view it was a new and better medicine. Obviously before it could be marketed it would have to go through trials – its properties (including for instance important characteristics such as bioavailability – which depends or may depend on solubility – and toxicity) had to be established. So it needed a new marketing authorisation. In sum it was a new product from all practical points of view.

Despite that, Mr Henry Carr QC (who argued this point for GUK) submitted that the SPC was invalid because there was no power to grant it. Levofloxacin was not to be regarded as a new active ingredient for the purpose of the SPC legislation. In essence the argument is that the authorisation to sell ofloxacin was the first authorisation to sell levofloxacin because levofloxacin is an active (indeed by far the most active) component of ofloxacin. It follows, so Mr Carr contended, that under the SPC legislation as properly construed, the date of authorisation for levofloxacin does not count because it was not the relevant first authorisation. Mr Carr submitted that result was not only compelled by the language of the legislation but was confirmed by the case law of the ECJ. And even if we were not convinced of that, the point was sufficiently doubtful that we ought to refer questions of interpretation to the European Court of Justice.

I do not accept these arguments. Nor do I consider that the position is doubtful. It is acte claire and there is no need for a reference. I turn to give my reasons in detail.

First the facts. These are uncontroversial:

I turn to the legislation. The operative legislation is the medicinal product Regulation 1768/92. Relevant to its interpretation is a later, sister SPC Regulation, 1610/96 providing for SPCs for plant protection products. The latter comes into play because one of its recitals, (17), explicitly says it is to be used for the interpretation of 1768/92. Rather than break up the narrative here, I set out the relevant provisions of the two Regulations in the annex to this judgment.

The basic scheme is concisely summarised by the Judge:

[205] … Protection is to be afforded to a product which is protected by a basic patent, has a marketing authorisation as a medicinal product and has not already been the subject of an authorisation or certificate. Protection is conferred for a maximum period of 15 years from the date of the first authorisation, including the life of the basic patent.

Mr Carr submits that the conditions for grant of the SPC for levofloxacin were not met because the 1990 UK authorisation (or the 1985 German authorisation – it makes no difference which) to market ofloxacin amounted to the first authorisation to market levofloxacin.

Like the Judge my initial instinct is that this must be misconceived. For one thing is clear, those earlier authorisations did not entitle Daiichi to market levofloxacin as such. Moreover the kind of research which led to levofloxacin was research which led to what for all practical purposes was a new medicine – the very kind of research referred to in recital (2). Moreover levofloxacin had to get marketing authorisation on the basis it was a new drug. The case is wholly within the policy reasons for the grant of SPCs as set out in the recitals.

In this latter connection I reject Mr Carr’s attempt to argue otherwise. He submitted that if the SPC were valid, Daiichi would be getting an overgenerous term of protection for levofloxacin, one running from the ‘005 patent. The flaw in that is this: once ‘005 ran out anyone could market ofloxacin. They could not market levofloxacin because of the patent in suit. And prior to the patent in suit they could not market levofloxacin for the simple reason invention was needed to make it. In reality there is no unwarranted extension of protection. It must be remembered here that an earlier patent may include within its claims things which are the subject of later inventions – improvement inventions are a major feature of the patent system. No one could reasonably contend that the grant of a patent for an improvement to an earlier invention extends the life of a patent for that earlier invention. Yet that is what Mr Carr’s submission amounts to.

In more detail Mr Carr’s argument runs thus:

Mr Carr sought to bolster his argument by reference to case-law. He particularly contended that BASF (Case C-258/99), MIT (Case 431-04) (both in the ECJ), as well as Fusilade (Bundespatentgericht, 27.3.2000 15W (pat) 26/98 GRUR 2000 Geft 10 921) were in his favour. Additionally he suggested we should follow the approach of the Israeli registrar of patents (Unipharm v Lundbeck, 3^rd February 2009, upheld on appeal by Judge Sobel on 25^th May 2009) and of the Australian courts (Lundbeck v Alphapharm, 11^th June 2009 Federal Court of Appeal [2009] FCAFC 70 upholding Lindgren J [2008] FCA 559).

First then, the language of the Regulation. The crucial part of Mr Carr’s step-by-step reasoning are steps (2) and (3). What is the “product” of the 1990 authorisation? To my mind the answer is clear – it is the racemic mixture -ofloxacin as such. We now know the enantiomers within it have individual biological properties: levofloxacin is much the more active from the desired antimicrobial point of view but the R(+) enantiomer has some activity (more than nalidixic and pipemidic acids) in that regard. Both are active in the undesired, toxicological, respect too. In this respect it is the R(+) which has the greater activity. But the overall activity of the racemic mixture derives from both components.

In the Regulation “product” means “the active ingredient or combination of active ingredients” (Art.2(b)). Clearly that must be read with the words “as the case may be” at the end. If you have two active ingredients the “product” is the pair of them. And ofloxacin is a combination of significantly active ingredients. So it is that combination which was the subject of the 1990 and 1985 authorisations. The authorisation for levofloxacin was the first authorisation for that active ingredient alone.

The position might have been different if the other component of the racemic mixture had been inactive biologically. Then I can see a case for saying it should be regarded as a mere diluent – as in effect no more than an excipient. Mr Waugh QC submitted that even then, an earlier authorisation for the racemic mixture would not count as the first authorisation for the active enantiomer. The point is that at the time of the earlier authorisation, unlike a deliberately added inert excipient, no one would have known that one enantiomer is inert – so it would be wrong to regard the authorisation as for the sole active enantiomer. He may be right but the point is moot and we do not have to decide it.

I turn to the cases. First BASF. It was a case under the sister Regulation for plant protection products. A first marketing authorisation had been given for a pesticide. Its terms were “Pyramin containing chloridazon as active substance.” “Pyramin” was BASF’s trade mark. Chloridazon was a chemical name for a compound which had two isomers (same molecular composition but different structures). Only one isomer was active. The other was treated for the purpose of the proceedings as a mere inactive impurity (“must in fact be regarded as an impurity”, see [9] of the Judgment). Pyramin was about (there was an immaterial dispute about exact proportions) 80% active isomer 20% inactive isomer. A second marketing authorisation was granted for “Pyramin DF, containing chloridazon as active substance”. Pyramin DF contained 90% active and 10% inactive. It was made by a patented process. BASF sought an SPC for chloridazon. The effect of the ECJ decision was that it should be refused.

This is hardly surprising. Both marketing authorisations were for the same active substance, “chloridazon”. All that changed were the proportions of active ingredient. Moreover the case turned on the definitions in the plant protection Regulation, which are not the same as the definitions in the medicinal products Regulation, in particular because there is nothing in the latter corresponding to Art. 1(2) of the former about impurities. Art 1(2) formed a specific part of the court’s reasoning.

The Court said:

19.

By the first part of Question 1, the national court is essentially seeking a definition of the concept of a product within the meaning of Article 3 of Regulation No 1610/96.

20.

It must be noted that, according to Article 1(8) of Regulation No 1610/96, a product means the active substance as defined in Article 1(3) or combination of active substances of a plant protection product.

21.

Under Article 1(3) of that regulation, active substances are inter alia substances having general or specific action against harmful organisms or on plants, parts of plants or plant products.

22.

Under Article 1(2) of that regulation, substances are defined as chemical elements and their compounds, as they occur naturally or by manufacture, including any impurity inevitably resulting from the manufacturing process.

23.

It follows from points 2, 3 and 8 of Article 1 of Regulation No 1610/96, taken together, that the concept of a product covers chemical elements and their compounds, as they occur naturally or by manufacture, including any impurity inevitably resulting from the manufacturing process, which have general or specific action against harmful organisms or on plants, parts of plants or plant products.

24.

Article 3 of Regulation No 1610/96, which lays down the conditions for obtaining an SPC, is based on the concept of a product. There is no indication that that concept differs from that of a product as defined in Article 1 of the regulation for the purposes of that same regulation.

25.

The answer to the first part of Question 1 must therefore be that the concept of a product within the meaning of Article 3 of Regulation No 1610/96 covers chemical elements and their compounds, as they occur naturally or by manufacture, including any impurity inevitably resulting from the manufacturing process, which have general or specific action against harmful organisms or on plants, parts of plants or plant products.

The second part of Question 1

26.

By the second part of Question 1, the national court is essentially asking whether two products which differ only in the proportion of the active chemical compound to the impurity they contain, one having a greater percentage of the impurity than the other, must be regarded as the same product within the meaning of Article 3 of Regulation No 1610/96.

27.

It follows from the answer to the first part of Question 1 that two products which are constituted of the same chemical compound having the same general or specific action against harmful organisms or on plants, parts of plants or plant products, and including any impurity inevitably resulting from the manufacturing process, must be regarded as identical.

28.

It is therefore apparent that a product may be identified by its chemical compound and its action on the targets mentioned in the preceding paragraph, whatever the impurities it contains. A fortiori, the nature of a product cannot change solely because of an alteration in the unit quantity of impurities where both the chemical compound it contains and that compound's action on its targets remain unchanged.

29.

The answer to the second part of Question 1 must therefore be that two products which differ only in the proportion of the active chemical compound to the impurity they contain, one having a greater percentage of the impurity than the other, must be regarded as the same product within the meaning of Article 3 of Regulation No 1610/96.

Mr Carr submitted that ofloxacin should be regarded in the same way: as no more than levofloxacin with an impurity. But I think that is wholly unrealistic: they are not regarded as such by patent law (hence the novelty of the patent for the enantiomer), or by the law controlling the marketing of medicines. Why should the law about SPCs, built as it is on those two branches of law, go off in a different direction? There is every reason in logic and policy as to why not. BASF does not support Mr Carr’s arguments.

Nor does MIT. It involved an attempt to get an SPC for a slow release form of a known and old pharmaceutical compound. The compound itself had a marketing authorisation, which, if it was the “first” for the purposes of the Regulation, meant that the SPC for the slow-release form had to be refused. The slow release was provided by a particular excipient which itself had no biological activity. Again not surprisingly, the effect of the ECJ’s decision was that an SPC should be refused.

The actual questions asked show that the Court was not concerned with a mixture of two active substances as we are here. They were:

1.

Does the concept of “combination of active ingredients of a medicinal product” within the meaning of Article 1(b) of Regulation [No 1768/92] mean that the components of the combination must all be active ingredients with a therapeutic effect?

2.

Is there a “combination of active ingredients of a medicinal product” also where a combination of substances comprises two components of which one component is a known substance with a therapeutic effect for a specific indication and the other component renders possible a pharmaceutical form of the medicinal product that brings about a changed efficacy of the medicinal product for this indication (in vivo implantation with controlled release of the active ingredient to avoid toxic effects)?’

The Court ruled that a combination of active ingredients did not include a combination of two substances only one of which has therapeutic effects … the other rendering possible a pharmaceutical form of the medicinal product. That seems to me a mile away from the problem here.

Mr Carr drew to our attention the Court’s endorsement in MIT of the position of the French Government:

18.

In this case, it is important to note that it is common ground, as the file in this case shows, that the expression ‘active ingredient’ is generally accepted in pharmacology not to include substances forming part of a medicinal product which do not have an effect of their own on the human or animal body.

19      In that regard, attention must be drawn to the fact that in point 11 of the Explanatory Memorandum to the Proposal for a Council Regulation (EEC), of 11 April 1990, concerning the creation of a supplementary protection certificate for medicinal products (COM(90) 101 final), to which the French Government referred in its oral observations, it is specified that ‘[t]he proposal for a Regulation therefore concerns only new medicinal products. It does not involve granting a [SPC] for all medicinal products that are authorised to be placed on the market. Only one [SPC] may be granted for any one product, a product being understood to mean an active substance in the strict sense. Minor changes to the medicinal product such as a new dose, the use of a different salt or ester or a different pharmaceutical form will not lead to the issue of a new [SPC].’

20      Therefore, the definition of ‘product’ in Article 1(b) of Regulation No 1768/92 does not in any way conflict with that referred to by the Commission in point 11 of that explanatory memorandum.

21      In fact, it is apparent from that memorandum that the pharmaceutical form of the medicinal product, to which an excipient may contribute, as noted by the Advocate General in point 11 of his Opinion and the French Government at the hearing, does not form part of the definition of ‘product’, which is understood to mean an ‘active substance’ or ‘active ingredient’ in the strict sense.

And he pointed to the Court’s endorsement of policy by reference to the plant protection Regulation:

23.

In this connection, in point 68 of the Explanatory Memorandum to the Proposal for a European Parliament and Council Regulation (EC), of 9 December 1994, concerning the creation of a supplementary protection certificate for plant protection products (COM(94) 579 final), it is stated that:

–        it would not be acceptable, in view of the balance required between the interests concerned, for the total duration of protection granted by the SPC and the patent for one and the same product to be exceeded;

–        that might be the case if one and the same product were able to be the subject of several successive SPCs;

–        that calls for a strict definition of the product;

–        if an SPC has already been granted for the active substance itself, a new SPC may not be granted for that substance, whatever changes may have been made regarding other features of the plant protection product (use of a different salt, different excipients, different presentation, etc.);

–        in conclusion, it should be noted that, although one and the same substance may be the subject of several patents and several marketing authorisations in one and the same Member State, the SPC will be granted for that substance only on the basis of a single patent and a single authorisation, namely the first granted in the Member State concerned.

24      Thus, the first sentence of Article 3(2) of Regulation No 1610/96 itself provides that the holder of more than one patent for the same product is not to be granted more than one SPC for that product. As set out in recital 17 in the preamble to that regulation, the detailed rules in Article 3(2) thereof, in particular, are also valid, mutatis mutandis, for the interpretation of Article 3 of Regulation No 1768/92.

Based on these passages, he submitted that “product” must be strictly construed – and so in the case of ofloxacin the product should be regarded as levofloxacin. I accept the former (which also follows from BASF) but not the latter. What the passage and policy is aimed at preventing is successive SPCs for mere minor variants of an active substance. That is simply not this case. Levofloxacin is a novel and inventive improvement over ofloxacin. It is not a minor variant. It has its own distinct activity, bioavailability and toxicity.

The last case relied upon which is concerned with EU legislation is Fusilade. It was an odd sort of reliance, because the case contains a passage which is dead against Mr Carr – that passage he submitted was wrong and shown to be so by the later cases of BASF and MIT. So, like the curate’s egg, Mr Carr submitted Fusilade was good in parts and we should ignore the bad bit.

The case was about another plant protection product. A basic patent protected the compound fluazifop-P-butyl. It was chiral, though the patent made no mention of this. A first marketing authorisation for a racemic mixture which went by the trade mark Fusilade had been granted. A later authorisation for a 91/9 mixture of the active and inactive enantiomers, trade marked Fusilade ME, was granted. So, unlike here, a racemic patent was being used to support an SPC for what was practically an enantiomer. The earlier authorisation for the racemic mixture was held to be the relevant first authorisation and the SPC was refused.

It is of particular importance to note that resolution was not and never had been a problem. The passage relied upon by Mr Carr reads as follows:

Although it is not mentioned anywhere in the basic patent (DE 28 12 571 C2) that the claimed compounds are present in the form of optical isomers, i.e., as R and S enantiomers, the structural formula of a compound with one asymmetrically substituted carbon atom is sufficient for the skilled person to easily recognise that he is dealing with optical antipodes, the R and the S form, and that the standard preparation process results in the racemate while the two enantiomers can be separated by standard methods. Thus, the racemate but also the two not expressly disclosed isomeric forms are protected by the basic patent pending according to formula I Y=H, Z1=C4-Alkoxy group, …

The Court also found that only the R enantiomer was active, the S being “virtually inactive”. Moreover that fact had been known for a long time. The Court then said (in the bit Mr Carr did not like):

Thus, the marketing authorisations for fluazifop-butyl and fluazifop-P-butyl both concern mixtures of the same two active substances and, therefore, even from this perspective concern the same product in the sense of Regulation (EC) 1610/96. If it was possible to grant a protection certificate for the basic patent also on basis of the 1984 authorisation for fluazifop-butyl, the protection certificate, in accordance with consideration (13) of the Regulation, would protect not only the racemate but also the two enantiomers as such or in any mixing ratios. Any grant of a further protection certificate based on a later authorisation for the R enantiomer would no longer be possible in view of Art. 3c) Regulation unless that form was the subject matter of a separate patent wherein it is specifically claimed (cf. consideration (14) of the Regulation). However, this is obviously not the case with fluazifop-P-butyl, nor has this been asserted.

The BPG’s reasoning applies here – because levofloxacin does indeed “form the subject of a separate patent.” Mr Carr submitted that that passage was wrong in the light of BASF and MIT. I do not think those cases support that at all, for the reasons I have already given.

Mr Carr also submitted that that passage was, as English lawyers say, obiter dictum – that is to say unnecessary for the decision. That is because there was no second patent. He is of course technically right, but it does not matter – it is a seriously expressed opinion on the same legislation by a court whose view commands considerable respect.

The Court’s reasoning was in part based on Recital 14 of the plant protection regulation, which, by virtue of Recital 17 applies also to the interpretation of the medicinal products regulation. Mr Carr accepted that was so, but suggested that it was limited to cases where the later patent was for derivatives consisting of salts or esters. I think that is a hopeless submission – clearly the BPG did not think so, for it was not concerned with a derivative in the strict sense of organic chemistry – but only with, in the relevant context, a clearly analogous case. Any rational or purposive reading of Recital 14 would not limit its use for construction of the Regulation only to derivatives in the strict chemical sense. The Recital is clearly using “derivatives (salts and esters)” by way of example only. The important point is that the product is sufficiently novel and inventive to justify a patent.

To put it another way, the Recital is to be used as an aid to construction of Art. 3 of the medicinal products Regulation. If one reads Art. 3(c) of that as excluding the case where there is a fresh patent for a derivative in the strict sense, it follows that it also excludes the case where there is a fresh patent for something analogous such as a fresh patent for an enantiomer. For if, as Recital (14) requires, a “product” which has “already been the subject of a certificate” (the language of Art.3(c)) cannot be read as covering a patented (and so ex hypothesi novel and inventive) derivative in the strict sense, it cannot cover any other substance which is novel and inventive. You cannot read Art 3(c) so as to exclude a novel and inventive derivative but not another sort of novel and inventive substance such as a novel and inventive enantiomer.

Mr Waugh went further. He contended that the bit of Fusilade which Mr Carr did rely upon was tainted by a view of novelty in the law of patents which is no longer correct as a matter of German law. For the passage I have cited above in effect is saying “the racemate is old, so it follows that the enantiomers (which the skilled person would know to be present) are also old.” That is not patent law here where we apply the inevitable result test for novelty of patents (cf Lundbeck v Generics and Synthon v SKB [2006] RPC HL). German law has now aligned itself with that rule (and with the EPO and the courts in the Netherlands) see e.g. Eli Lily v Egis Gyơgyszergyár, Case X ZR 89/07, 16 December 2008 (Bundesgerichthof). So, submitted Mr Waugh, one could not really rely upon the passage concerned.

I am far from convinced that the BPG in Fusilade was seeking to apply or was influenced by the then German view about novelty for patents. It ought not to have been, for the case was not about patent novelty. What the BPG was simply saying is that the patent claim of the basic patent covered the individual enantiomers as well as the racemate. And, because the racemate could be resolved, the enantiomers could not be patented. But the point does not matter: what is clear is that the BPG thought that the fact that if there was a subsequent patent for the compound concerned any earlier authorisation was not the first authorisation for the subsequently patented product.

Curiously I expressed the same view, obiter, some time ago in Draco’s Appn. [1996] RPC 417. I said at p.439:

The research leading to the Turbohaler was formulation research. I see nothing indicating that formulation research (unless of course it warrants its own patent) is to be protected by the SPC scheme. The scheme is not for the general protection of the fruits of research. It is to compensate for lost time in the exploitation of inventions which are patented.

I do not resile from this view, which indeed seems to me the only possible and rational view of this EU legislation. I think the point is acte claire.

Nor am I impressed with the cases cited from outside the EU, including the one from the US cited by Mr Waugh. The reason is simple – they are all concerned with different statutory language, views of the facts and policies. Thus in the Israeli case the registrar specifically had regard to the fact that the EU Regulation was in different language from that in Israel (see [46]). On appeal Judge Sobel specifically had regard to the strong Israeli generics drug industry ([13]) and specifically rejected decisions abroad on the basis that they were of “lesser importance” given the specifically Israeli context of the legislation. He cited a decision of the High Court: “Law is a creature that lives in its surroundings and the environment of Israeli law differs from English or American law, even if their formulation is different”.

The Australian case too was concerned with different statutory language: “containing, or consisting of, the substance” were the key words. It is wholly understandable that all the judges concluded that a racemate “contains” its enantiomers.

Nor do I find assistance from the US case relied upon the other way by Mr Waugh. It was Ortho-McNeil v Lupin Pharmaceutical, 30th April 2009 (US District Court of New Jersey, Chief District Judge Brown). A patent extension for levofloxacin was granted under USC §156. But again the language of that provision was different from that with which we are concerned, though it indeed may be somewhat closer to ours than the Israeli or Australian language.

So the foreign (i.e. non-EU) cases cut no ice either way. The upshot is that the SPC was clearly properly granted and this appeal should be dismissed.