29 April 2013

“Worthwhile to Try” is Not Obvious Enough in Australia

Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd (No 2) [2013] FCA 279 (4 April 2013)

TryThe Federal Court has again confirmed that, contrary to the impression you might obtain from reading IP Australia’s Patent Examiners Manual, ‘obvious’ or ‘worthwhile’ to try does not form part of the test for inventive step under Australian patent law.

I wrote recently about another aspect of the judgment in Bayer v Generic Health, namely the alleged inconsistency of the testimony of an expert who also provided evidence in a dispute more than a decade ago, between generic manufacturer Alphapharm Pty Ltd and originating pharmaceutical manufacturer Aktiebolaget Hässle.  Coincidentally, the High Court’s decision in Aktiebolaget Hässle v Alphapharm Pty Ltd [2002] HCA 59 is also the source of the current Australian law in relation to ‘obvious’ or ‘worthwhile’ to try (at paragraphs [66]-[76]).

IP Australia changed its ‘practice’ in relation to this aspect of examination of patent applications back in August 2010.  At the time, I questioned this change, noting that ‘the High Court majority drew a distinction between “matters of routine” (discussed at paragraphs [50]-[53]) and “obvious or worthwhile to try” (discussed at paragraphs [66]-[76]).  I also observed that the previous guidance for examiners – which adopted a quite different interpretation of the Hässle case – was still available for comparison in the Internet Archive (a.k.a. ‘Wayback Machine’).  Unfortunately, this is no longer the case, because IP Australia, in its wisdom, has decided that earlier versions of its practices should not be available, for posterity or any other purpose, and has added all of the relevant subdirectories of its web site to its robots.txt file.

It is timely to revisit this issue now, with the Raising the Bar reforms just having come fully into effect, because as a subsequent Official Notice revealed, the change in examination practice was one of the first steps to be implemented in IP Australia’s reform agenda.  Apparently, IP Australia accepted ‘stakeholder feedback’ that ‘“obvious to try with a reasonable expectation of success” … has support in the High Court decision in Aktiebolaget Hässle v Alphapharm Pty Ltd’.

‘Routine Steps’ versus ‘Obvious/Worthwhile to Try’

The majority of the High Court in Hässle made a clear distinction between two different approaches to assessing obviousness, or lack of inventive step.

Firstly, at paragraphs [50] to [53], it explained a ‘matter of routine’ (that is the heading, above paragraph [50]), based on the High Court’s earlier decision in Wellcome Foundation Ltd v VR Laboratories (Aust) Pty Ltd [1981] HCA 12.  This approach to the question of obviousness – which does form part of the law in Australia, can be summarised as follows:

Would the notional person(s) skilled in the relevant art(s), in all the circumstances, which include a knowledge of all the relevant prior art and common general knowledge in the field, directly be led as a matter of course to try what is now claimed as an invention, in the expectation that it might well produce a solution to the problem at hand?

Significantly, this formulation directs attention to what the skilled person would (not ‘might’) have done as a matter of routine (e.g. by following well-known standard procedures), with specific reference to what that person’s expectations would have been prior to commencing the trials.  Evidence is needed to answer the question: what did people routinely do at the relevant time; what did they know; and what would their expectations have been?

Subsequently, at paragraphs [66]-[76], the High Court discussed ‘“obvious” or “worthwhile” to try’ – that is the heading above paragraph [66], and it appears that the court saw the terms ‘obvious’ and ‘worthwhile’ as essentially interchangeable in this context.  In particular, the majority observed (at [72]) that:

… the statute does not ask whether a particular avenue of research was obvious to try so that the result claimed therefore is obvious; the adoption of a criterion of validity expressed in terms of “worth a try” or “obvious to try” and the like begs the question presented by the statute. In a sense, any invention that would in fact have been obvious under the statute would also have been worth trying.

The factual basis for a conclusion that a particular course of action was ‘obvious to try’ is quite different from a case of a ‘matter of routine’.  With the benefit of hindsight, if an invention is successful, it is self-evident that it would have been worth trying the particular steps leading from the prior art to the invention.  However, the High Couirt has made it clear that this is not a legitimate approach to the question of obviousness under the Australian law.  It is not enough to show that the required steps could have been taken, and that they would have resulted in the invention.  The fact that an invention might well have been discovered by a process of trial-and-error is not sufficient, in Australia, to establish obviousness in law.

Confirmation in Bayer v Generic Health

To quickly recap (for a more detailed discussion, see my earlier post on the Bayer case), the invention in Bayer involved an oral contraceptive including a compound ‘DRSP’ which is weakly soluble in water, and which readily degrades in an acidic environment.  Surprisingly, despite these properties, it turns out that an ‘immediate release’ formulation in which DRSP is exposed to the acidic contents of the stomach results in sufficient bioavailability of DRSP for the product to work effectively and reliably.  The claimed invention therefore comprised a formulation that did not include a so-called ‘enteric coat’, which would have served to protect the contents of a tablet as it passed through the stomach, allowing it to be absorbed instead in the alkaline environment of the intestine.

Generic Health argued that, despite knowledge of the properties of DRSP, a formulator would nonetheless conduct initial trials of the bioavailability of DRSP, and would therefore have discovered the surprising effectiveness of an immediate release formulation. 

Bayer argued that, on the contrary, a formulator would not have carried out an initial bioavailability study, and that even if they had done so, it would not have been with any expectation of success.  Furthermore, Bayer pointed out that the claims in question were not directed merely to any immediate release formulation, but rather to one in which DRSP satisfied specific dissolution criteria defined in those claims.

Overall, it is apparent that there were steps which the skilled person could have taken (i.e. initial bioavailability trials) which would have revealed information (i.e. surprisingly good bioavailability of DRSP) that would, in all likelihood, have led the skilled person to conduct further trials which might have resulted in the development of a formulation in which DRSP had the dissolution properties defined in Bayer’s claims.  Clearly, all of these steps would have been ‘worthwhile to try’.  As it turns out, they might well have led to Bayer’s invention.

The court rejected Generic Health’s argument, observing (at [68]) that it is apparent from the High Court’s decision in Hässle

… that the references in the authorities to “some other useful result” cannot be understood as encompassing the mere obtaining of information which the hypothetical skilled addressee might or would find useful in assisting the addressee to determine what steps to take. This is apparent from the clear rejection by the High Court of any notion that the concept of obviousness is synonymous with steps which the skilled addressee might or would consider “worthwhile to try”…. That this is so is apparent from the majority’s preference for the United States authorities …, in particular the reference to the concept that any research endeavour usually involves an element of obviousness to try….

IP Australia’s Approach

To be fair to IP Australia, although Section of the Examiners Manual is headed ‘Obvious to Try’, the approach set out in the section is closer to the ‘routine steps’ test which was approved by the High Court in Hässle that it is to the rejected ‘worthwhile to try’ test.  Even so, it does not require an examiner to establish any matters of routine which would have caused a skilled person to proceed from the prior art to the claimed invention.  Rather, it encourages an approach which looks firstly to the difference between the claim and the prior art, before considering whether there are steps which might have been considered ‘obvious to try’, and which would have then led from the prior art to the claimed invention.

In any event, IP Australia cannot change the law merely by changing its practice, or the particular form of words used in the Examiners Manual.  Applicants who receive objections based on the ‘obvious to try’ approach as set out in the Manual should consider carefully whether the objections are valid in light of what the majority of the High Court actually decided in the Hässle case. 

In particular, for a claimed invention to be obvious, it is necessary that the skilled person would, rather than merely could, have taken the allegedly obvious steps as a matter of routine and, if so, that they would have done so with the reasonable expectation of arriving at the claimed solution to the problem addressed by the invention.  If either one of these two requirements is not satisfied, then the claimed invention is not obvious under Australian law.

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