• Grant Shoebridge PhD & Jacinta

The Australian Federal Court teaches generics how to avoid infringement of Swiss-style claims

The enlarged bench of the Full Court of the Australian Federal Court has clarified what constitutes infringement of Swiss-style claims in Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2020] FCAFC 116 (the Mylan decision). However, in doing so the Court walks a tightrope in relation to contributory (indirect) infringement of corresponding method of treatment (MOT) claims.

The Mylan decision regarding the scope of Swiss-style claims is worth consideration by both parties at the pre-litigation review stage. The message to patentees is to make sure you include both Swiss-style and MOT claims in relevant patent applications. The message to generics/biosimilars companies is to proceed with caution noting there may be circumstances in which you avoid infringement of Swiss-style claims, but still indirectly infringe corresponding MOT claims in Australia.

The fenofibrate (Lipidil®) case

Mylan’s product, fenofibrate (Lipidil®) approved for the treatment of diabetic retinopathy is covered by Swiss-style claims directed to “use of fenofibrate or a derivative thereof for the manufacture of a medicament for the prevention and/or treatment of retinopathy, in particular diabetic retinopathy”, in Australian Patent No. 2006313711. We focus here on one of the 3 patents in suit.

Sun Pharma’s allegedly infringing products, referred to as “the Ranbaxy Products”, were initially indicated for the treatment of diabetic retinopathy. However, Sun later amended its product information (PI) to a “skinny label” removing reference to diabetic retinopathy. According to the first instance decision, this indication represented ~50% of the market for fenofibrate.

Mylan’s position was that the relevant Swiss-style claims were infringed by the Ranbaxy products because:

(1) the amended Ranbaxy PI stated that the Ranbaxy product was bioequivalent to Lipidil®; and (2) the PI for Lipidil® stated that it was indicated for reducing the progression of diabetic retinopathy.

However, the primary judge did not agree, and Mylan appealed to the Full Court.

Swiss-style claim construction

The Full Court confirmed that the scope of a Swiss-style claim is the method or process of making a medicament. A Swiss-style claim does not cover a method of treatment using the medicament after it is produced. Thus, the scope of a Swiss-style claim is distinct from the scope of a method of treatment claim.

Relevantly, the Full Court noted that Swiss-style claims are “purpose-limited claims”. In other words, the medicament produced from the manufacture process is defined by the therapeutic purpose for which it is manufactured, as set out in the claim.

Infringement considerations and finding

Nicholas J at first instance found that the crucial question for infringement of a Swiss-style claim is whether the manufacturer has made the relevant medicament with an intention that it be used for the treatment defined by the claim. The Full Court disagreed with this approach finding that it was not necessary to add a feature to the claim, namely the manufacturer’s intention. The Full Court stated:

infringement of a Swiss-style claim is concerned with what the allegedly infringing manufacturer has done, not what it intended to do”.

Therefore, in determining infringement, the Full Court posed the following question in relation to a product of the claimed process (our emphasis): “is the medicament for the specified therapeutic purpose?”, where the therapeutic purpose relates to, for example, “physical characteristics of the medicament …. its formulation and dosage, packaging and labelling, and its patient information”.

The Full Court agreed with the primary judge that “mere suitability of a medicament for a claimed purpose cannot be determinative of the question of infringement of a Swiss type claim”. Otherwise, infringement could result from a method predating the priority date of the claim that involved the manufacture of a medicament for the purpose of treating a different disease, where the medicament is suitable for treating the disease referred to in the claim.

Ultimately, the Full Court came to the same conclusion as the primary judge (albeit by different reasoning) that had Mylan’s Swiss-style claims been valid (they aren’t) they would not have been infringed by the Ranbaxy products. In coming to this decision, the Court referred to the fact that there was a significant therapeutic use for the Ranbaxy products (~50% of the market) in the treatment of diseases other than diabetic retinopathy, including hypercholesterolaemia, various types of dyslipidaemia, and dyslipidaemia associated with type 2 diabetes.

The Full Court acknowledged that the Ranbaxy products were referred to as “bioequivalent to Lipidil®”, and that Lipidil® is indicated for reduction in the progression of diabetic retinopathy. However, the Full Court found that the “conjunction” of these facts did not point persuasively to a conclusion that the Ranbaxy products are medications for diabetic retinopathy.

The Court also found that it was not necessary for the Ranbaxy products to include a disclaimer of use for diabetic retinopathy to avoid infringement of a Swiss-Style claim. The Court stated that the absence of a disclaimer is “hardly proof that, as manufactured, a medicament is one for a therapeutic use that has not been disclaimed, when the medicament’s therapeutic use has been clearly stated

The Swiss-style claim and method of treatment tightrope

Notably, although the primary judge rejected the argument for infringement of the Swiss-style claims, he nevertheless found indirect infringement under s 117(1) of the Patents Act in respect of the MOT claims.

In its appeal, Mylan submitted that the primary judge acted inconsistently in coming to this finding. The Full Court disagreed, distinguishing between a product manufactured for a particular use, which is relevant for infringement of a Swiss-style claim, and a use to which the product may be put, which is relevant for contributory infringement of a method of treatment claim. This distinction permitted the Full Court to agree with the primary judge that, had the claims been valid, the Swiss-style claims would not be infringed but contributory infringement would have occurred in respect of the MOT claims.

Conclusion

The Mylan decision’s consideration of Swiss-style claims provides several key takeaways.

For patentees, it reinforces the importance of including both Swiss-style claims and corresponding method of treatment claims in patent applications, which together cast a broader net in which to capture infringing parties. Moreover, it is worth noting that both claim types must be included before the patent is granted. The scope of a granted patent cannot be extended by amendment and hence, given the difference in the scope of Swiss-style and MOT claims, the Patent Office will not allow a post-grant amendment to introduce a method of treatment claim if only a Swiss-style claim is present in the granted patent. (If a divisional application is still pending, of course the method of treatment claims can be included in that application.)

For generics/biosimilars, companies that wish to avoid the likelihood of infringing Swiss-style claims, a skinny label strategy is important. However, there is no requirement for the product information to specifically disclaim use for the disease referred to in a swiss style claim, nor is there a necessity to instruct physicians or pharmacists not to prescribe the pharmaceutical for the disease referred to in the Swiss-style claim.

In practice, it is unusual to find a patent with Swiss-style claims but no MOT claims. However, it is not uncommon for a patent to have a number of Swiss-style claims, not all of which have directly corresponding MOT claims. (This can occur, for example, when a patentee conserves costs at acceptance by only including MOT claims because there is a fee for each claim in excess of 20.) The Mylan decision relating to the scope of Swiss-style claims is worth consideration by both parties at the pre-litigation review stage.

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