Commissioner of Patents v AbbVie Biotechnology Ltd

Background 14 There are three patents in suit: Patent No. 2012261708 (the 708 patent); Patent No. 2013203420 (the 420 patent) and Patent No. 2013257402 (the 402 patent). Each specification is entitled "Human antibodies that bind human TNFalpha" and describes a pharmaceutical substance called adalimumab. Adalimumab is produced by a process of recombinant DNA technology. 15 There is no doubt that all the claims in suit are Swiss type claims, as discussed in Otsuka Pharmaceutical Co Ltd v Generic Health Pty Ltd (No 4) (2015) 113 IPR 191; [2015] FCA 634 (Otsuka) at [100]-[121]. Speaking broadly, such claims are, in form, directed to the use of a substance in the manufacture of a medicament to be administered for a specified therapeutic purpose. An invention in this form is appropriately characterised as a "method or process", not as a "product": Otsuka at [120]. 16 The claims of the 708 patent are directed to the use of adalimumab in the manufacture of a medicament for the treatment of ulcerative colitis. The claims of the 420 patent are directed to the use of adalimumab in the manufacture of a medicament for the treatment of Crohn's disease. The claims of the 402 patent are directed to the use of adalimumab in the manufacture of a medicament for the treatment of rheumatoid spondylitis. 17 The three patents were granted on the basis of divisional applications. The date of each patent is 10 February 1997, with a maximum term expiring on 10 February 2017 (absent any extension). 18 Adalimumab is marketed under the name Humira in the form of an injectable solution for the treatment of diseases including rheumatoid arthritis, rheumatoid spondylitis, Crohn's disease and ulcerative colitis. 19 Humira was originally included in the ARTG, established under the Therapeutic Goods Act 1989 (Cth), on 10 December 2003. This approval was limited to the use of Humira for the treatment of rheumatoid arthritis. This is not one of the indications to which the claims of the patents are directed. However, further approvals for Humira were obtained on 10 August 2006 (for the treatment of rheumatoid (ankylosing) spondylitis); on 29 June 2007 (for the treatment of Crohn's disease); and on 23 July 2013 (for the treatment of ulcerative colitis), and Humira was included in the ARTG for these indications. 20 On 3 October 2014, the respondent, as patentee, applied to the Commissioner for an extension of the term of each patent, relying on s 70(2)(b) of the Patents Act. The respondent claimed an extension to 10 August 2021 for the 402 patent and an extension to 10 February 2022 for the 708 patent and the 420 patent. 21 On 4 August 2015, each application was refused: AbbVie Biotechnology Ltd (2015) 115 IPR 398; [2015] APO 45. The Deputy Commissioner of Patents (the Deputy Commissioner), who under s 208 of the Patents Act has all the powers and functions of the Commissioner (other than the power of delegation under s 209 of the Patents Act), concluded that, in each case, the condition specified in s 70(2)(b) had not been satisfied. In that connection, the Deputy Commissioner (at [12]) adopted the following passage in his reasons in ThromboGenics NV (2015) 115 IPR 391; [2015] APO 44: … in my view, the reference in s 70(2)(b) to a substance when produced by a process involving recombinant technology means that product as such, not characterised by its therapeutic use, mode of delivery or features other than its process of production. Consequently a substance when produced by a process that involves the use of recombinant DNA technology will not fall within the scope of a claim that is characterised by a therapeutic use in the same way as a pharmaceutical substance per se does not fall within the scope of such claims. Otherwise extensions of term will be granted that are clearly inconsistent with the purpose of the Act. In particular it seems clear that patents covering new therapeutic uses of old substances produced by old processes should not be extended even if they involve recombinant DNA technology. 22 At [13], the Deputy Commissioner reasoned with respect to the claims in suit that: … while notionally directed to a method or process of manufacturing a medicament, the claims are characterised by a therapeutic use. Consequently, on the basis of my reasons in ThromboGenics I do not find that a pharmaceutical substance, when produced by a process that involves the use of recombinant DNA technology, in substance falls within the scope of the claims. I must therefore refuse the application for an extension of term. 23 At [14], the Deputy Commissioner found that, in any event, the first regulatory approval date, as comprehended by s 70(3)(b), was, in each case, 10 December 2003, when approval had been given to the use of Humira for the treatment of rheumatoid arthritis. The first regulatory approval date was not one or more of the dates referable to the subsequent inclusions of Humira in the ARTG for the other indications. This meant that, in each case, the maximum extension that could have been granted was to 10 December 2018. 24 Finally, at [19] the Deputy Commissioner noted that the requirements of s 71(1) had not been met because, in each case, the respondent had incorrectly stated the first regulatory approval date for Humira. 25 On 1 September 2015, the respondent applied to the Tribunal under s 224(1) of the Patents Act to review the Deputy Commissioner's refusal decisions.

The tribunal decision 26 Before the Tribunal, the parties identified four issues for determination. The Tribunal was satisfied that only two issues arose for determination and that, upon the determination of those issues, the remaining issues could be resolved by the parties themselves. The two issues (as expressed by the Tribunal at [14]) were: (a) Does a pharmaceutical substance, when produced by a process that involves the use of recombinant DNA technology, fall within the scope of the claims of the patents within the meaning of section 70(2)(b) of the Patents Act? (b) Did the Delegate wrongly conclude that the first relevant inclusion of goods in the ARTG was the inclusion of adalimumab, rather than the first inclusion of adalimumab characterised by its method of production and intended use? 27 As to the first issue, the Tribunal reasoned (at [62]) that s 70(2) does not indicate that Swiss type claims are to be excluded from eligibility for extension. 28 Further, the Tribunal noted (at [68]) the following passage in the Explanatory Memorandum for the Intellectual Property Laws Amendment Bill 1997 (Cth), which inserted the current s 70 into the Patents Act: The extension of term provisions will be available for patents that include claims to pharmaceutical substances per se (provided that the other criteria are met) [i.e. a product claim]. These claims to pharmaceutical substances per se would usually be restricted to new and inventive substances. Patents that claim pharmaceutical substances when produced by a particular process (product by process claims) will not be eligible unless that process involves the use of recombinant DNA technology. Claims which limit the use of a known substance to a particular environment, for example claims to pharmaceutical substances when used in a new and inventive method of treatment, are not considered to be claims to pharmaceutical substances per se. 29 Based on that passage, the Tribunal concluded (at [69]) that: … it is apparent that eligibility for extension of a patent would be applied to product claims and to process claims but only where such claims were made in respect of a substance produced by a process of recombinant DNA technology. If a process claim is made in respect of a substance not so produced, the patent for that substance does not qualify for extension. 30 The Tribunal said (at [71]) that, under s 70(2)(b), the only qualification for an extension is that the substance be produced by recombinant DNA technology and that: … an exclusion of Swiss style claims based upon a substance produced by recombinant DNA technology is unwarranted. 31 In this paragraph, the Tribunal reasoned that, had Parliament intended to exclude Swiss type claims from s 70(2)(b): … it would have been a simple matter to include the words "per se" after the word "process" and to make no reference to description of the pharmaceutical substance produced by recombinant DNA technology. Parliament did not do so. 32 Based on this reasoning, the Tribunal concluded that the Deputy Commissioner had erred in his interpretation of s 70(2)(b) and that the applications for extension were not "disqualified" by reason of the fact that the relevant claims were Swiss type claims. 33 As to the second issue, the Tribunal concluded (at [89]) that the Deputy Commissioner was correct to find, in respect of each application, that the first regulatory approval date was 10 December 2003. Having reached this conclusion, the Tribunal then noted the parties' agreement that the Deputy Commissioner's decision - that the respondent did not comply with s 71(1) of the Patents Act - should be affirmed. 34 At [92] of its reasons, the Tribunal made the following note: The Tribunal notes that the parties reached a further agreement that the maximum extension available to the applicants if the patents are able to be extended is to 10 December 2018 according to the formula in section 77 of the Patents Act. However, because the applications which have been made under section 71(1) would be taken to have identified the wrong registration date by reason of the determination as set out in the decision above … the applicant would not be entitled to an extension on the basis of the extension of term applications which have been filed and are the subject of the present proceedings. The applicant can however apply to correct the error. 35 The Tribunal expressed its decision as follows: With respect to the Delegate's decision dated 4 August 2015 refusing the [respondent's] applications for extension of the term of the relevant patents, the Tribunal: (a) Sets aside and substitutes a decision that a pharmaceutical substance, when produced by a process that involves recombinant DNA technology, in substance falls within the scope of the claims of the patents within the meaning of section 70(2)(b) of the Patents Act 1990 (Cth) where such patent is granted in respect of a particular therapeutic use. (b) Affirms the decision that the first regulatory approval date of the substance adalimumab for the purposes of section 70(3) of the Patents Act 1990 (Cth) is 10 December 2003. (c) Affirms the decision that the Applicant did not comply with section 71(1) of the Patents Act 1990 (Cth).

Jurisdiction 36 There is a threshold question as to whether the present appeal is competent. The upshot of the review before the Tribunal was that the decision to refuse the extension of term applications made by the Deputy Commissioner was not disturbed by the Tribunal even though the Tribunal concluded, contrary to the Deputy Commissioner's finding, that each application was amenable to s 70(2)(b) of the Patents Act. The fact remained that the requirements of s 71(1) of the Patents Act had not been satisfied given the incorrect statement of the first regulatory approval date in each extension of term application. 37 Does the fact that the Tribunal came to a different view on the meaning and application of s 70(2)(b) of the Patents Act entitle the Commissioner to appeal on that question, even though the outcome of the review before the Tribunal remained the same as the outcome of the proceeding before the Deputy Commissioner? 38 This question was raised at the commencement of the hearing of the appeal and the Commissioner made submissions on it. Leave was granted to the Commissioner to file supplementary submissions on the question. 39 Although the question has not been agitated with the assistance of a contradictor, we are satisfied that the appeal is competent. 40 An appeal under s 44(1) of the AAT Act lies only from a decision of the Tribunal which constitutes the effective decision or determination of the application for review: Director-General of Social Services v Chaney (1980) 47 FLR 80; [1980] FCA 108 (Chaney) at 103. In Kishore v Tax Practitioners Board (2016) 244 FCR 320; [2016] FCA 1328 at [19], Robertson J explained Chaney as having the effect that a disappointed party does not have a right of appeal instanter from non-determinative steps, determinations or decisions of the Tribunal. His Honour noted: This reflects the undesirability of fragmenting proceedings in the Tribunal by the making of applications to the Federal Court seeking to challenge intermediate directions, determinations or decision of the Tribunal … 41 This explanation and approach was endorsed by the Full Court in Chief of Navy v Angre (2016) 244 FCR 457; [2016] FCAFC 171: see, in particular, the reasons of Mortimer J at [47]-[49]. 42 We note that s 44(1) refers to an appeal being taken from "any" decision of the Tribunal. In Chaney, Deane J did not consider that the use of the word "any" altered the character of a decision that was amenable to an appeal to the Court under that provision. His Honour said that the use of "any" is explicable because s 43(1) of the AAT Act confers on the Tribunal a range of alternative ultimate decisions which may be given by it. 43 Section 43(1) of the AAT Act provides: For the purpose of reviewing a decision, the Tribunal may exercise all the powers and discretions that are conferred by any relevant enactment on the person who made the decision and shall make a decision in writing: (a) affirming the decision under review; (b) varying the decision under review; or (c) setting aside the decision under review and: (i) making a decision in substitution for the decision so set aside; or (ii) remitting the matter for reconsideration in accordance with any directions or recommendations of the Tribunal. 44 His Honour said (at 101) that the use of "any" in s 44(1) of the AAT Act is also explicable by the fact that: … it is possible that one proceeding before the Tribunal could involve the review of a number of connected decisions by the original decision maker with the consequence that the proceeding before the Tribunal called for a number of ultimate decisions each of which effectively disposed of a separate part of the proceedings (see, for example, Sullivan v. Department of Transport where the grant of two distinct licences was in issue). 45 These observations are of particular significance to the present case. There seems little doubt that the Tribunal considered that the Deputy Commissioner's decision on the meaning and application of s 70(2)(b) of the Patents Act was one of a number of connected decisions that had been made by the Deputy Commissioner in considering the respondent's extension of term applications. The Tribunal treated the meaning and application of s 70(2)(b) as an ultimate decision it was called upon to make in the review and, conformably, exercised the power under s 43(1)(c)(i) of the AAT Act to set aside the Deputy Commissioner's decision in that regard and substitute its own decision. We do not think that the Tribunal erred in adopting this approach which, we note, involved, in the event, the discrete exercise of power under s 43(1) to three different but nevertheless connected decisions concerning the respondent's extension of term applications. Each decision by the Tribunal can be seen as an ultimate decision in the review. Significantly, the Tribunal did not make a composite decision that either "affirmed" or "refused" any of the applications in suit even though, as we have said, the Deputy Commissioner's refusal to extend the terms of the patents remained undisturbed. 46 We note the Tribunal's contemplation that the respondent could "apply to correct the error" in its extension of term applications and thereby overcome its failure to comply with the requirements of s 71(1) of the Patents Act: see [92] of the Tribunal's reasons quoted at [34] above. In submissions, the Commissioner said that the respondent might seek to do this under s 104 of the Patents Act. If that course were open to the respondent, and if it were to make such an application successfully, the Commissioner would be bound to allow an amendment in proper form and, then, proceed to deal with the amended extension of term applications in accordance with the Tribunal's finding as to the meaning and application of s 70(2)(b). If that were to eventuate, the Commissioner would have no right of review against her own decision (see the terms of s 224(1) of the Patents Act) and it can be expected, in any event, that, in future cases, the Tribunal would ordinarily follow the decision it has given in the instant case: Re Scott and Commissioner for Superannuation (1986) 9 ALD 491 at 499-500. Thus, accepting its competence, it cannot be said that the present appeal raises a question that is moot.

Section 70(2) 47 The Patents Act recognises a broad, dichotomous division of inventions as products, or as methods or processes. This is clear from the definition of "exploit" in the Dictionary contained in Schedule 1 to the Act. 48 A "pharmaceutical substance" is defined in the Dictionary in terms which plainly indicate that such a substance is a "product": … a substance (including a mixture or compound of substances) for therapeutic use whose application (or one of whose applications) involves: (a) a chemical interaction, or physico-chemical interaction, with a human physiological system; or (b) action on an infectious agent, or on a toxin or other poison, in a human body; but does not include a substance that is solely for use in in vitro diagnosis or in vitro testing. 49 Both s 70(2)(a) and s 70(2)(b) concern pharmaceutical substances, as defined. The cases dealing with s 70(2)(a) recognise that it is the character of pharmaceutical substances as products that gives meaning to the "scope of the claim or claims" referred to in that provision (emphasis added). This understanding has been assisted by the provision's use of the expression "per se" in the composite expression "one or more pharmaceutical substances per se". Put simply, the cases have recognised that the provision's concern is with inventions that are products, not inventions that are methods or processes. 50 In Boehringer Ingelheim International v Commissioner of Patents (2000) AIPC 91-670; [2000] FCA 1918, Heerey J traced the history and antecedents of the present extension of term provisions. The case itself involved claims directed to a container comprising an aerosol or spray composition for nasal administration or the use of such a composition when used in the container. At [13], Heerey J concluded that the Patents Act, in its present form, draws a distinction between a pharmaceutical substance that is the subject of a patent claim and a pharmaceutical substance that forms part of a method or process. One matter of significance to his Honour's reasoning leading to that conclusion was the fact that s 70(2)(b) provides a specific exception in relation to recombinant DNA technology - an exception which, his Honour said, "proves the rule". 51 His Honour suggested that a claim in relation to a pharmaceutical substance could be made in three ways: a new and inventive product alone; an old or known product prepared by a new and inventive process; and an old or known product used in a new and inventive mode of treatment. At [15], his Honour said: What is clear in s 70 is that only the first type of claim to a pharmaceutical product is to be subject to extension rights. So far as a new process is concerned, it is only when the new process answers the particular description in s 70(2)(b) (recombinant DNA process) that it can be the subject of an extension. As counsel for the Commissioner submitted, the policy to be deduced in the light of the legislative history is that Parliament has decided that what is intended to be fostered is primary research and development in inventive substances, not the way they are made or the way they are used, with the sole (and important) exception of recombinant DNA techniques, this being an area particularly worthy of assistance for research and development. 52 It is clear that Heerey J was directing attention to both limbs of s 70(2) in the context of one policy objective. On appeal, his Honour's explanation was endorsed by the Full Court: Boehringer Ingelheim International GmbH v Commissioner of Patents (No 2) (2001) 112 FCR 595; [2001] FCA 647 (Boehringer Ingelheim) at [37]. In that appeal, the Full Court observed (at [42]) that: … in the context of s 70(2)(a), we think that falling within the scope of a claim in a patent specification means included amongst the things claimed. Here, the substance, in itself, is not a thing claimed in the patent sense. 53 In Prejay Holdings Ltd v Commissioner of Patents (2003) 57 IPR 424; [2003] FCAFC 77 (Prejay), Wilcox and Cooper JJ commented on the Full Court's observation in Boehringer Ingelheim, saying (at [24]): As is apparent from the context of these words, especially the Full Court's references to the legislative history of s 70, the Full Court was saying that, for a substance to fall within s 70(2)(a) it must itself be the subject of a claim in the relevant patent. It is not enough that the substance appears in a claim in combination with other integers or as part of the description of a method (or process) that is the subject of a claim. The policy adopted in s 70 was to confine extensions to patents that claim invention of the substance itself. 54 Once again, their Honours were addressing one policy objective. Importantly, their Honours went on to consider the significance of s 70(2)(b) in that regard, saying (at [25]): This conclusion is not negatived by the terms of s 70(2)(b) of the Act …that paragraph does not require disclosure of a process. Rather, it requires the disclosure of "one or more pharmaceutical substances" that are produced by a particular process. 55 This observation is significant because it acknowledges that s 70(2)(a) and s 70(2)(b) address the same concern - extensions of term in relation to claims directed to pharmaceutical substances, not methods or processes involving pharmaceutical substances. The only exception is the one specifically acknowledged by s 70(2)(b), where pharmaceutical substances can be produced by a process that involves recombinant DNA technology. But, even so, the matter claimed must be the pharmaceutical substance or substances so produced, not other methods or processes involving those substances. 56 In this latter regard, we think there is much to be said for the Commissioner's submission, articulated orally, that it would be inapposite for s 70(2)(b) to refer to "one or more pharmaceutical substances per se" because the "one or more pharmaceutical substances" in s 70(2)(b) are further characterised by the fact that they must be produced by a particular process - one involving recombinant DNA technology. Nonetheless, each provision's concern is with pharmaceutical substances, not additional or other matter concerning or involving the use of pharmaceutical substances. In this way, s 70(2)(b) can be construed conformably with s 70(2)(a), and both provisions can be given an harmonious operation, directed to the same end. 57 This understanding is consistent with the passage in the Explanatory Memorandum quoted at [28] above. The passage emphasises that the extension of term provisions are directed to new and inventive substances - not the method or process by which they are produced (other than involving recombinant DNA technology). Of particular significance is the specific acknowledgement that claims to pharmaceutical substances when used in new and inventive methods of treatment are not intended to be part of the extension of term regime. This passage in the Explanatory Memorandum refers to "pharmaceutical substances per se", but its reference to product by process claims, and to recombinant DNA technology in particular, signifies that both limbs of s 70(2) are being discussed: see also Section 8 on p. 9 of the Explanatory Memorandum, and [7] and [10] of the Notes on Clauses in Schedule 1 thereto.

Swiss type claims and s 70(2) 58 The first and critical matter to note about Swiss type claims is that they are not claims to pharmaceutical substances at all. They are method or process claims which, in this connection, exhibit a dual character. First, they are directed to a method or process in which a substance is used to produce a medicament. Secondly, they have an additional method or process element constituted by a specific purpose to which the medication is to be used. Thus, the scope of Swiss type claims is fundamentally different to the scope of the claims addressed by s 70(2) of the Patents Act. 59 With specific reference to the present case, adalimumab is a pharmaceutical substance produced by a process that involves recombinant DNA technology. However, the claims in suit are not directed to adalimumab produced by recombinant DNA technology. They are directed to different subject matter. First, they are directed to a method or process in which adalimumab is used to produce a medicament. Secondly, they are directed to a medicament containing adalimumab that is to be used for specific therapeutic purposes, being those identified at [16] above. These claims do not meet the requirements of s 70(2)(b). In our respectful view, the Tribunal erred in concluding otherwise. 60 The Tribunal's error was that, in construing s 70(2)(b), it proceeded on the basis that, once it is shown that a pharmaceutical substance has been produced by a process involving recombinant DNA technology, that is enough, without more, to attract the operation of the extension of term provisions to a patent which discloses the substance, so produced. The Tribunal reasoned that s 70(2)(b) did not, in terms, exclude Swiss type claims in respect of such a substance. However, in so reasoning, the Tribunal effectively overlooked the requirement in s 70(2)(b) that, even though produced by a process involving recombinant DNA technology, the pharmaceutical substance must also, in substance, fall within the scope of the claim or claims of the specification in suit. Properly construed, this means that it is the pharmaceutical substance that must be the subject matter of the claim or claims, not methods or processes (beyond recombinant DNA technology) concerning or involving the pharmaceutical substance. 61 The fact that, in the present case, the claims in suit are in the form of Swiss type claims necessarily means that the pharmaceutical substance in question (adalimumab) does not "in substance fall within the scope of the claim or claims" of the specifications in suit, within the meaning of s 70(2)(b). The claims in suit are of an entirely different scope, as explained above. 62 As a final matter, we note that it appears that the Tribunal might have placed reliance on the decision of Lee J in Astra Lakemedel Aktiebolag v Commissioner of Patents (1995) 56 FCR 208 as supporting its construction of s 70(2)(b). In our respectful view, that case provides no assistance. It deals with a previous regime for extensions of term.

Disposition 63 For these reasons, the appeal should be allowed. Decision (a), identified at [35] above, should be set aside and the decision of the Deputy Commissioner - that, in each case, the applications for extension do not comply with s 70(2)(b) - should be affirmed. I certify that the preceding sixty-three (63) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Besanko, Yates and Beach.