22 July 2012

Extended Monopoly on ARAVA (Leflunomide) Upheld on Appeal

Appeal Decision: Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd (No 2) [2012] FCAFC 102 (18 July 2012)
Appeal from: Sanofi-Aventis Australia Pty Ltd v Apotex Pty Ltd (No 3) [2011] FCA 846
See also: Australian Federal Court ‘Evergreens’ ARAVA for Sanofi-Aventis

Claim construction – second medical use claims directed to treating specific ailments – Novelty – application of the ‘reverse infringement test’ where effect may be ‘inherent’ in practising the prior art – Infringement – infringement by supply of products

ARAVA packagesA Full Bench of the Federal Court of Australia has unanimously upheld a July 2011 decision of Justice Jagot barring the introduction of generic alternatives to Sanofi-Aventis’ ARAVA and ARABLOC products.  At first instance, the court found that a ‘second medical use’ patent directed to the use of the active ingredient leflunomide for the treatment of psoriasis effectively extends an existing monopoly on marketing of the drug for treatment of rheumatoid and psoriatic arthritis until 2014.  Sanofi’s original patent on leflunomide expired in 2004.

The three main patent issues in the case are:
  1. the correct interpretation of a ‘second medical use’ claim;
  2. whether a prior art teaching to administer a compound to a patient anticipates a claimed effect of the compound on the patient; and
  3. whether, and in what circumstances, marketing a compound for one medical purpose constitutes an indirect infringement of a patent directed to an alternative use of the compound.
A fourth issue – whether the patent claims were directed to suitable subject matter, i.e. a ‘manner of manufacture’ – was readily dismissed at first instance and on appeal.

The three appeal judges unanimously overturned Justice Jagot’s claim construction finding (quite rightly so, in our opinion).  However, the court’s original finding of novelty was upheld (Chief Justice Keane adopting different reasoning from Justices Bennett and Yates), as was a finding that supply of products containing leflunomide as an active ingredient would be an infringement under section 117 of the Patents Act 1990.


A more detailed background to the dispute can be found in our earlier report Australian Federal Court ‘Evergreens’ ARAVA for Sanofi-Aventis.

Briefly, however, Sanofi-Aventis had an Australian patent covering the compound leflunomide, which expired in 2004.  This compound patent enabled it to prevent the supply of leflunomide for any purpose.  The approved purposes for which the drug is registered on the Australian Register of Therapeutic Goods (ARTG) relate to the treatment of rheumatoid and psoriatic arthritis (PsA).

Sanofi-Aventis has a further Australian Patent, no. 670491 (‘the patent’), which is the subject of this litigation.  The patent is entitled ‘pharmaceutical for the treatment of skin disorders’, and expires on 29 March 2014.  This patent covers a subsequent medical use of the drug, not envisaged in the original patent, namely in the treatment of the skin condition psoriasis.  Until 2014, when this further patent expires, Sanofi-Aventis therefore has a monopoly on the use of leflunomide for the treatment of psoriasis.  However, the drug is not currently approved in Australia for this purpose.

Nonetheless, in the original trial the court found that the patent was valid, and would be infringed by the supply by Apotex of a generic version of leflunomide ostensibly for its approved purpose of treating psoriatic arthritis.

Not surprisingly, Apotex appealed this finding.


The patent conveniently has only one claim, which may be paraphrased as follows:
  1. A method of preventing or treating … psoriasis, which comprises administering to a recipient an effective amount of a pharmaceutical composition containing as an active ingredient a compound of the formula I [including leflunomide] or II...
This is a typical form of a second (or other subsequent) medical use claim, i.e. ‘a method of treating affliction X by administering a compound Y’, where Y is already known to have some therapeutic effect in the treatment of one or more conditions other than X.  So long as the prior art does not teach or suggest the effective use of Y for treating X, such claims are considered valid in most jurisdictions.

It is generally uncontroversial that such claims are infringed by supplying products containing the active ingredient Y for the specific purpose of treating X.  The question arose in this case of how far the scope of the claim might extend beyond express supply of the drug for the claimed purpose.

In this regard, four possible constructions of the claim were originally considered, of which only two were considered viable, and which were supported by Apotex and Sanofi-Aventis respectively:
  1. A method comprising the administration by a medical practitioner to a recipient of a pharmaceutical composition [containing leflunomide] where the ‘objective purpose’ of the administration is to prevent or treat psoriasis in the recipient.
  2. A method comprising the administration by a medical practitioner to a recipient of a pharmaceutical composition [containing leflunomide] where the effect of the administration in fact is to prevent or treat the recipient’s psoriasis.
The first construction – preferred by Apotex – would essentially result in infringement only when leflunomide is prescribed specifically for treatment of psoriasis.  The second – preferred by Sanofi-Aventis – would result in infringement whenever the actual effect of administration of leflunomide is to prevent or treat psoriasis, regardless of the objective purpose for which it was originally prescribed.

Justice Jagot had come down in favour of Sanofi-Aventis, meaning that the prescription of leflunomide for one of its approved purposes (e.g. PsA) would infringe the claim if there was a likelihood that this would also result in the treatment of psoriasis.  The evidence established that patients with PsA very commonly also present with psoriasis, and thus infringement was guaranteed to occur on this construction of the claim.

The Full Court unanimously overturned this construction.  As Chief Justice Keane stated (at [45]):

Here the monopoly claimed by the patent to the use of leflunomide is a process of treatment involving a deliberate process of diagnosis and prescription directed to the treatment or prevention of psoriasis. Given that the policy of patent law is to reward invention, not serendipity, one should be slow to construe a patent to a method or process as excluding competitors of the patentee from an area of trade by reason of consequences which the patent does not claim.

The joint judgement of Justices Bennett and Yates includes a similar expression (at [125]):

Thus what distinguishes the claimed invention from what has gone before is the recognition that leflunomide can be used in a new method of treatment involving a new and different therapeutic use, that bears the characteristics of a patentable invention. … This new method of treatment, as a patentable invention, can only be realised or expressed through the deliberate administration of leflunomide to prevent or treat psoriasis. It will not be realised or expressed by its administration with some other object or end in view that happens to achieve the result of preventing or treating psoriasis accidentally or as an unsought consequence. To construe the claim as simply requiring the administration of leflunomide that achieves a therapeutic or biological result that includes the prevention or treatment of psoriasis is, in our view, effectively to ignore the governing characteristic incorporated into the express words of the claim that the invention is a method directed to preventing or treating psoriasis – the claimed advance in the art.

In other words, the scope of the monopoly conferred by the claim is commensurate with the scope of the inventors’ contribution, and no more – an entirely sensible outcome.


Justice Jagot originally found the patent claim to be novel not merely because the prior art did not teach the use of leflunomide to treat psoriasis – the parties were agreed that this was the case, so this much was uncontroversial.

The important finding was that the prior art also did not teach the use of leflunomide as a treatment for PsA.  This meant that there was no instruction in the prior art to do something with leflunomide – i.e. use it for treatment of PsA – that would inevitably result is treatment or prevention of associated psoriasis.  Thus the original finding of novelty was consistent with the broader construction of the claim.

On appeal, Justices Bennett and Yates agreed with Justice Jagot’s conclusions on novelty (at [178]).

Chief Justice Keane did not consider it necessary to revisit the question of whether the prior art taught the use of leflunomide to treat PsA, in view of the different construction of the claim reached on appeal.  Specifically, since the claim is directed only to the deliberate treatment of psoriasis, it will only be anticipated by a prior art teaching to use leflunomide to treat psoriasis (at [66]):

If one takes the assertions in the [prior art]at their highest for [Apotex], the [prior art] claimed that leflunomide, by virtue of its antirheumatic and antiphlogistic effects, provides “a method for the treatment of inflammations [and] rheumatic complaints”. These assertions of the prospective benefit of the use of leflunomide in “tackling rheumatic illness in man” fall far short of making a disclosure equal, for the purposes of practical utility, with the disclosure of the invention by the patent in suit. These assertions simply do not disclose a method of treatment of psoriasis, an ailment, not of the joints, but of the skin.

This, it seems to us, is the correct and consistent approach.


Despite the more limited reach of the claim under the Full Court’s construction, Apotex’s proposed conduct in marketing a generic version of leflunomide did not escape infringement.

Section 117 of the Australian Patents Act 1990 deals with indirect infringement by the supply of products (e.g. pharmaceuticals) in circumstances in which they will be put to infringing use.

Subsection (2) defines the specific forms of ‘use’ which will trigger operation of the provision:
  1. if the product is capable of only one reasonable use, having regard to its nature or design – that use; or
  2. if the product is not a staple commercial product – any use of the product, if the supplier had reason to believe that the person would put it to that use; or
  3. in any case – the use of the product in accordance with any instructions for the use of the product, or any inducement to use the product, given to the person by the supplier or contained in an advertisement published by or with the authority of the supplier.
Justice Jagot had found that the second and third of these three conditions applied.  Leflunomide could only be supplied for the approved purposes identified on the ARTG, including treatment of PsA, which would result in the product being put to a use which would also treat or prevent psoriasis, thereby infringing the patent.

Despite reaching a different construction of the claim, the Full Court reached the same conclusion on the application of section 117.  As expressed by Chief Justice Keane (at [54]): 

By reason of the primary judge’s findings of fact in relation to s 117(2)(b) and (c) of the Act, one must conclude that the supply by the appellant of its generic leflunomide product for the use by rheumatologists in the treatment of PsA would infringe the patent. The appellant’s PID [product information documentation] instructed the use of leflunomide in the treatment of psoriasis which is associated with PsA, as will commonly be the case. On that basis, s 117(2)(c) is engaged. The appellant’s instruction also means, for the purposes of s 117(2)(b), that the appellant had ample reason to believe that medical practitioners would put leflunomide to use as a method of treating psoriasis which is associated with PsA.

Justices Bennett and Yates reached the same conclusion (at [146] and [155]).


The circumstances in this case are somewhat unusual, in that leflunomide, which is approved for use in the treatment of PsA, also happens to treat or prevent psoriasis which is associated with PsA.  The fact that specialists (e.g. rheumatologists) prescribing the drug for its approved use know and expect that it will also treat associated psoriasis makes it inevitable that any generic version of leflunomide will be prescribed in circumstances which will result in infringement of the patent.

The upshot of this is that Apotex has been prevented from introducing a generic product onto the market, even though the original compound patent expired in 2004.

The close relationship between an original use of the drug (for treatment of PsA) and a subsequently-discovered use (for treatment of psoriasis) means that, in this case, the monopoly conferred by the original compound patent has effectively been extended for a decade.
The author, Dr Mark Summerfield, is employed by the patent attorney firm within Watermark Intellectual Asset Management, which represented Sanofi-Aventis in the prosecution of the application which became patent no. 670491.  This article is based wholly upon publicly-available information, including the content of the published decisions of the Federal Court of Australia.  Any opinions expressed in this article are independent and solely those of the author. (Also see our 'About' page.)


Ken said...

Note that Apotex and Spirit Pharmaceuticals have already introduced a generic leflunomide product, albeit not indicated for the treatment of psoriatic arthritis.

Patentology (Mark Summerfield) said...

Thanks for your comment, Ken.

There appear to be various entries on the ARTG for leflunomide products, including some in the name of Apotex, Spirit, Southern Cross and Sandoz.

Some of these are indicated only for treatment of rheumatoid arthritis, and not for treatment of psoriatic arthritis. I presume that these are the products which have been introduced already? In which case, generic leflunomide would be available to be supplied in Australia for treatment of rheumatoid arthritis, but for no other purpose. Is that your understanding?

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