Astrazeneca AB v Hexal AG & Ors

This case is about the validity of a European Patent (UK) No. 0, 907, 364 (the Patent). It is for sustained release formulations of an anti-psychotic drug called quetiapine.

According to the 6 claimant companies the Patent is invalid. They say that what is claimed in the Patent to be an inventive step would, at the priority date (May 1996), be obvious to the notional addressee skilled in the prior art.

The claimants crisply summarise the essence of their case on obviousness in this way. They point to the Patent as itself recognising the general desirability of a sustained release form of a pharmaceutical. The Patent specifically draws attention to the well-known advantages of such formulations: they are able to provide a stable and desired blood plasma level of the active ingredient, without the need for frequent administration. That recognition accords with the common general knowledge that sustained release formulations provide significant advantages: more stable dosing over a period and the possibility of less frequent administration. The use of the gelling agent involved was not inventive. The materials before the trial judge showed that there was clear motivation to make a more-convenient-to-take, once-a-day formulation. There was no technical reason to suppose that it would have been difficult to make such a formulation: indeed, it would have been straightforward. None of the points, which were put up by the defendant patentee to suggest that a skilled person (in this case a skilled team) would have been put off, would, in fact, have deterred the skilled person from actual trial.

The claimants cited in support the observations of Jacob LJ in what they say is a very similar case to this on the facts and the law: Actavis v. Novartis [2010] EWCA Civ 82; [2010] FSR 18 at [61]-[64]. In that case this court rejected an appeal against the finding of obviousness of a sustained release formulation of a drug fluvastatin, which involved no technical difficulty and produced improved patient compliance. Mr Simon Thorley QC appearing for the patentee, AstraZeneca AB, cautioned the court against reliance on Actavis v. Novartis. He submitted that that case turned on its own facts. In at least four respects those facts were to be contrasted with the facts in this case. There were significant differences between the Novartis patent and the Patent in this case. Mr Thorley QC cited a contrary recent authority on the question of obviousness in relation to sustained release formulations: Ratiopharm GmbH v. Napp Pharmaceutical Holdings Ltd [2008] EWHC 3070 (Pat); [2009] RPC 11; and [2009] EWCA Civ 252; [2009] RPC 18. In that case the claim for revocation of the patent in suit failed, whereas it succeeded in Novartis.

The Patent is valid according to AstraZeneca, which markets quetiapine under the name Seroquel XL in sustained release form prescribed for the treatment of schizophrenia, bipolar disorder and major depressive disorder. The essence of its case against obviousness is that, at the priority date, no dosage form of quetiapine was approved or on the market. It was inventive to think of what the Patent provides in the light of the problems alleged to exist. At the priority date there was no perceived advantage or motivation to formulate quetiapine as a sustained release dosage form. The skilled addressee would have been put off from doing so.

Mr Thorley QC emphasised the importance of noting at the very outset that the claimants did not advance any case at trial that there was any motivation or desire for a sustained release formulation of quetiapine per se. The claimants’ case was that there was a motivation to provide a once-a-day formulation of quetiapine. That would in turn lead to a consideration of sustained release formulations. Absent the alleged desire for once-daily dosing, it was not suggested that the skilled addressee would have had any reason to consider a sustained release formulation of quetiapine.

According to the excellent judgment of Arnold J, handed down after a 5 day trial of 3 actions with 4 expert witnesses, the claimants are right about obviousness. There was no inventive step. He revoked the Patent by his order dated 24 April 2012 on the ground that, in the light of the prior art and the common general knowledge, the relevant claim was obvious. He found that the skilled person would regard a once-a-day formulation as desirable; that, in order to achieve that result, a sustained release formulation and a higher dose of an immediate release formulation would both be obvious possibilities; that the skilled person would not expect, from his common general knowledge or from a literature search, that quetiapine was likely to saturate on first pass metabolism and would not, therefore, be deterred from developing a sustained release formulation, nor would its expectation of success be adversely affected; and the skilled person could achieve success without difficulty.

According to AstraZeneca’s Notice of Appeal the judge was wrong about practically everything that he decided in his judgment, save, it seems, for his order granting AstraZeneca permission to appeal and a stay of the order for revocation pending the outcome of the appeal.

The grounds of appeal relied on by AstraZeneca have been revised, as explained below, but are still quite lengthy. They are that the judge erred in principle in not considering the allegation of obviousness on the basis advanced by the claimants in their evidence regarding the development of a new formulation of quetiapine starting from Gefvert (see below) and the clinician’s reasons for recommending once-daily dosing in preference to twice-daily dosing, and the requirement for those recommendations to be based on clinical considerations. The judge did not consider whether the clinician’s common general knowledge provided any, or any sufficient, motivation to overcome the teaching in Gefvert that once-daily dosing of quetiapine was unlikely to be efficacious. In any event, the judge erred in his analysis of the situation. He should have considered matters in the round, but instead considered matters on an impermissible stepwise basis without ultimately considering the cumulative effect of all the relevant factors.

In particular, the judge erred in identifying the roles of the different members of the notional skilled team, which he identified as the skilled addressee, at different stages in the notional project, such as who should be regarded as the leader, the clinician or the formulator; in concluding that there was any motivation for the skilled addressee clinician to propose the development of a once-a-day formulation; in adopting an impermissible “step wise” approach to the question of inventive step and to the identified factors that would have led the skilled addressee to have concerns over the development and effectiveness of a once-a-day sustained release formulation of quetiapine and would put a skilled person off from actual trial in detail; and in adopting the wrong approach in law to the issue of obviousness, contrary to what is laid down in the authorities.

A central criticism of the judgment is that it failed to address AstraZeneca’s case as a whole on the key question. That question was the skilled addressee’s expectation of success in being able to make an improved formulation of quetiapine using sustained release technology in the combined light of the totality of the points made by AstraZeneca, such as reduced efficiency, side effects, lack of information on key matters and other concerns.

Had the judge not erred, he would, AstraZeneca contends, have reached the same conclusion as reached by the District Court of the Hague (see below) and held Claim 1 to be valid for the same reasons. There was no, or insufficient, motive for the clinician to recommend once-daily dosing of quetiapine in the light of Gefvert and his common general knowledge, coupled with the fact that the prospect of making a sustained release formulation with an adequate efficacy and side-effect profile was at best uncertain.

The response of the claimants to those criticisms of the judgment by AstraZeneca is that there is nothing in any of them that could lead this court to overturn the judgment of Arnold J: this appeal is a re-run of the arguments on evidential points and factual matters rejected by Arnold J. He was the judge of fact. This court is not. The facts were decided by the Judge against AstraZeneca in accordance with the evidence and he reached his conclusions by applying the correct legal principles relevant to the statutory test of obviousness.

According to the judgments of patent courts in some other jurisdictions, there is a considerable range of informed legal opinion about the alleged obviousness of the claimed inventive step in equivalent patents. Ongoing litigation in the courts of other countries about the validity of patents equivalent to the Patent featured in the decision below was a factor affecting the judge’s decision to grant permission to appeal. The District Court of the Hague gave judgment in March 2012 rejecting the contention of one of the claimants in these proceedings (Sandoz) that the equivalent patent was invalid for obviousness. The Spanish Courts have also upheld the validity of the equivalent patent. The German Courts granted relief in infringement proceedings on the basis that the equivalent patent was valid.

Since the hearing of the appeal the parties have notified the court of further developments in other jurisdictions. On 13 November 2012 the Federal Patent Court declared the German equivalent patent invalid for obviousness. On 14 February 2013 the United States Court of Appeals for the Federal Circuit unanimously upheld the lower court’s ruling in AstraZeneca v. Anchen Pharmaceuticals & Ors that the formulation patent protecting SEROQUEL XR (quetiapine fumarate) extended release tablets in the US is valid and infringed. On 7 March 2013 the Ontario Federal Court held in AstraZeneca Canada Inc & Anor v. Teva Canada Limited & Anor that the equivalent patent was invalid on applying a test of obviousness similar to that applied in the English Courts.

The widely disputed validity of equivalents to the Patent does at least go some way towards validating an ancient aphorism Quot Homines Tot Sententiae. The different Homines obviously all think that their Sententiae are right. The truth is that they may well be, when they are considered on the basis of the actual evidence and the particular legal submissions before them in the different proceedings in the various courts. Judicial decisions on obviousness turn on the evidence adduced by the parties, on the arguments advanced on their behalf and on the adjudicating body’s understanding of all the materials before it.

Fortunately, we do not have to decide whether the judgments of other courts in different jurisdictions are right or wrong. In this case in this court appellate judging is a more modest enterprise: all that we have jurisdiction to decide under Part 52 CPR is the more manageable question whether the order made by Arnold J was, on the evidence and arguments before him, wrong. If it was not, we have no jurisdiction under Part 52 to set aside his order and we would have to dismiss AstraZeneca’s appeal.

Originally two claims in the Patent were in issue.

The first was claim 1. It was for a sustained release formulation of an anti-psychotic drug known as quetiapine or seroquel. It was formulated by use of a gelling agent. The judge held that a sustained release formulation would, at the priority date, be, to the notional person skilled in the prior art, an obvious way of achieving the desirable objective of daily administration of the drug.

The second was claim 15. It was for formulations also containing a material known as sodium citrate as a pH modifier.

Only claim 1 is live in this appeal. AstraZeneca has made it clear that it does not agree that the judge was correct in holding that claim 15 was invalid and that it does not make any concessions. The court was informed during the hearing of the appeal that AstraZeneca no longer asks the court to consider claim 15, or certain other grounds originally raised in the Appeal Notice, notably the point that the judge wrongly concluded that the skilled formulator would have approached the task of formulating quetiapine with a general expectation that its first pass metabolism would not be saturated by the clinical dose.

AstraZeneca submitted a marked up version of its Grounds of Appeal indicating the grounds that this court needs to consider. It emphasised that it does not concede or accept that Arnold J was correct or entitled to find as he did in relation to the other grounds.

Mr Simon Thorley QC for AstraZeneca and Mr Daniel Alexander QC for the claimants argued the remaining grounds with commendable conciseness and lucidity.

Arnold J set out the background in his judgment [2012] EWHC 655 (Pat).

The detail in a first instance judgment of such obvious quality does not need to be repeated to the same extent in the decision on appeal. The only issue is whether the order under appeal was wrong. This judgment can keep to those points that are essential for an understanding of AstraZeneca’s grounds of appeal, its arguments as to why Arnold J’s decision was wrong and the claimants’ reasons for upholding that decision.

Claim 1 in paragraph [0001] states that the invention relates to a sustained release pharmaceutical composition comprising quetiapine or a pharmaceutically acceptable salt thereof. Paragraph [0002] of the specification states:

“It is desirable in the treatment of a number of diseases, both therapeutically and prophylactically, to provide the active pharmaceutical ingredient in a sustained release form. Desirably the sustained release provides a generally uniform and constant rate of release over an extended period of time which achieves a stable and desired blood (plasma) level of active ingredient without the need for frequent administration of the medicament.”

The judge reviewed the evidence on formulation common general knowledge by reference to routes of administration (oral); immediate release formulations; and the main advantages and limitations of sustained release formulations. He also reviewed the situation on compliance, both from the clinician’s perspective and from the formulator’s perspective, on prescribing practice and on convenience.

His overall conclusion, based on the evidence as a whole, was that the skilled team would regard once-a-day formulation of quetiapine as preferable. That was on the grounds that it might lead to better patient compliance and it was more convenient to both patients and carers. The skilled team would also have been well aware that one of the advantages of sustained release formulations was that they enabled less frequent administration, in particular, once a day rather than twice a day.

The correct approach in law (a) to the issue of obviousness and (b) to an appeal from the decision of the trial judge on such an issue is so well settled that it would be pointless to review and impertinent to revise what other, more expert judges, have repeatedly said in the cases cited in argument, such as Biogen v. Medeva [1997] RPC 1 at 34; Conor Medsystems Inc v. Angiotech Pharmaceuticals Inc [2007] EWCA Civ 5; [2007] RPC 20; [2008] RPC 28; Generics (UK) Ltd v. H Lundbeck A/S [2007] EWHC 1040 (Pat); [2007] RPC 32 at [72].

The ultimate question of fact for Arnold J was simply this: would claim 1 be obvious to a person skilled in the art having regard to the state of the art at the priority date? See MedImmune Ltd v. Novartis Pharmaceuticals UK Ltd [2012] EWCA Civ 1234 at [181] per Lewison LJ. Commercial, as well as technical, considerations may be relevant to that question; so may other factors, such as whether the step in the claim was obvious “to consider” or “to try” and whether there was “a motive to find a solution” to the problem addressed by the patent in suit.

In arriving at his fastidiously reasoned conclusion Arnold J considered and evaluated, in an orderly way, all of the evidence relevant to obviousness, including the evidence given by two experts on each side. Following the guidance in the authorities Arnold J addressed the evidence on obviousness in all its various aspects. Who was the notional person skilled in the art? What was the relevant common general knowledge of that person? What was the inventive concept of the claims? What differences, if any, were there between the state of the art and the inventive concepts? Were those differences steps which would have been obvious to the person skilled in the art? Or did they require a degree of invention? Those are all aspects of the overwhelming question considered by the judge from every angle in the fact-finding process of evaluating the evidence.

The role of this court is not the same. The Court of Appeal does not retry the issue of obviousness. That has already been tried by Arnold J. This court reviews the case to see if the decision on obviousness is wrong. That issue involved the trial judge in an evaluation or assessment of the whole of the evidence, including the weight to be given to particular factors. This court is reluctant to interfere with a finding of obviousness, unless the judge has gone wrong on a point of legal principle or if, for some other reason, the decision is plainly wrong.

In the course of his judgment Arnold J reached clear conclusions.

The judge recorded that there was little dispute by the end of the trial that the skilled person to whom the Patent is addressed is a team of people. It comprised a clinician, a pharmacologist, a formulation scientist and a pharmacokineticist. In a passage, which is said by AstraZeneca to be flawed by an error of principle, the judge said this:-

“6.

The only dispute between the parties was as to which member of the team should be regarded as the leader. The Claimants contend that the Patent is primarily directed to the formulator. AstraZeneca contends that the development of a new formulation of quetiapine would be primarily driven by clinical considerations and to that extent would be led by the clinician. The formulator would then use his knowledge and experience to try to prepare an appropriate formulation and method of manufacture for that formulation in accordance with the clinician’s instructions as to what was required. In my judgment those contentions are not inconsistent with each other: AstraZeneca is looking at the position prior to the Patent, whereas the Claimants are looking at the position after the Patent. I therefore accept both contentions. Either way, as both sides accept, there would be a notional conversation between the members of the team, in which the advantages and disadvantages of potential formulations would be considered.”

The judge recorded that, by the end of the trial, there was a good deal of common ground with regard to clinical common general knowledge and formulation common general knowledge. He set out the position regarding the basics of drug absorption and action [34]-[36]; immediate release formulations [37]-[39]; and sustained release formulations [40] and their advantages [42]. He reviewed the standard texts linking the use of sustained release formulations with improvements in compliance [[56]-[57].

Mr Daniel Alexander QC for the claimants explained that, although the judge found that sustained release formulations were a well known way to achieve a once-a-day formulation, sustained release is not a synonym for once-a-day; once-a-day can be immediate release or sustained release.

As regards the areas of common general knowledge that were in dispute Arnold J made a specific finding on compliance and convenience. That finding is challenged by AstraZeneca:-

“64.

…The conclusion which I draw from the evidence as a whole is that the perception of the skilled team would have been that once daily dosing was to be preferred to twice daily both because it might lead to better patient compliance, although there was no hard evidence that it did so, and because it was more convenient to patients and, particularly, carers. Furthermore, the skilled team would have been well aware that one of the advantages of sustained release formulations was that they enabled less frequent administration, and in particular once a day rather than twice a day.”

In the light of the judge’s findings I turn to Claim 1 in the Patent as analysed by the judge in [72]-[83].