14 July 2020

Actions Trump Intentions in Determining Infringement of ‘Swiss’ Claims in Australia

Swiss type cheeseIn what might well be the final word on the scope and effect of so-called ‘Swiss type’ claims in Australia – at least for the foreseeable future – an enlarged panel of five judges of the Federal Court has clarified what is required for infringement of this form of claim: Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2020] FCAFC 116.  A Swiss type claim (the terminology used by the Court in this case, although they are also known as ‘Swiss-style’ or simply ‘Swiss’ claims) is generally of the form: ‘Use of [compound X] for the manufacture of a medicament for treatment of [condition Y].’  Such claims invoke a kind of legal fiction, in that according to the normal rules of interpretation the scope of the claim encompasses any and every method of making a medicament of any kind that includes the compound X as an active ingredient, subject only to this being suitable for treating the new condition.  Interpreted in this way, a Swiss type claim would never be valid in the usual case that medicines containing compound X already exist for the purpose of treating one or more different conditions.  We have collectively agreed, however, that as a matter of law a Swiss type claim is to be construed as if reciting the new therapeutic purpose (i.e. ‘treatment of condition Y’) imposes a distinct limitation on the scope of the claim sufficient to impart novelty to the invention.

In the Mylan case, a representative Swiss type claim – namely claim 1 of Australian patent no. 2006313711 – was:

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.

A corresponding claim for a method of treatment is claim 7 of the same patent:

A method for the prevention and/or treatment of retinopathy, the method comprising administration of fenofibrate or a derivative thereof to a patient in need thereof.

While both types of claims are allowable in Australia (as discussed further below), a key distinction between them is the identity of a direct infringer.  A Swiss type claim is directed to the manufacture of a product, and thus may be directly infringed by the manufacturer – normally the party that a patentee would want to restrain.  Method of treatment claims, on the other hand, are directly infringed in the course of treatment, i.e. by a physician and/or patient, who are typically not the desired targets of infringement action.  A patentee must therefore generally rely on indirect or contributory infringement provisions in order to pursue a manufacturer or supplier on the basis of a method of treatment claim.

In this case, the Court found that both the Swiss type claims and the method of treatment claims were invalid for lack of novelty and/or inventive step in view of various prior art disclosures.  Thus there could be no infringement in any event.  However, the Court nonetheless considered important questions of the interpretation and requirements for infringement of Swiss type claims.  In particular, the Court determined that ‘infringement of a Swiss type claim is concerned with what the allegedly infringing manufacturer has done, not what it intended to do.’

The Question of Infringement of Swiss Type Claims

Swiss type claims were originally devised to accommodate restrictions on patenting methods of medical treatment in Europe, and are particularly targeted to second and subsequent medical uses of known products that cannot (because they are not new) be patented in their own right.  In Australia, it has long been the practice of the Patent Office to permit patents on methods of treatment, and the validity of treatment claims was confirmed by the High Court in 2013.  Nevertheless, Swiss type claims remain common in Australia, and patent attorneys generally advise obtaining such claims along with method of treatment claims, principally because they can be directly infringed by a manufacturer of a medicine, whereas the direct infringer of a treatment claim is a medical practitioner who prescribes the medicine, and/or a patient who uses it.

Swiss type claims are directed to the method or process of making a medicament.  They are purpose-limited, in the sense that the medicament resulting from the method or process is characterised by the therapeutic purpose for which it is manufactured, as specified in the claim.  As the Full Court explained:

[197] The specification of a therapeutic purpose imposes an important limitation on the scope of the claim. In theory, it is this limitation which supports the novelty, and hence the patentability, of the invention. Without this limitation, the claim would be invalid because its scope would be broadened to include old subject matter (bearing in mind that Swiss type claims are directed to methods or processes whose products are for second or later therapeutic uses). It is appropriate, therefore, to consider this purpose as one that confines the use of the method or process to the achievement of one end and one end only—a medicament for the specified therapeutic purpose; not a medicament for any other therapeutic purpose. Put another way, a Swiss type claim does not claim the invention in terms of a medicament that is useful for, or can be used for, the specified therapeutic purpose and other therapeutic purposes. In order to support its patentability, and preserve its validity, the invention, as claimed through a Swiss type claim, is necessarily more limited in scope.

[198] The characterisation of the medicament by specification of the therapeutic purpose is, therefore, an essential feature of the invention as claimed. Like any other essential feature, it must be proved in order for infringement of the claimed method or process to be established.

The difficulty in determining whether or not a Swiss type claim has been infringed thus becomes apparent.  It is not, in general, an infringement merely to make and sell the medicament itself, because the medicament, by definition, has pre-existing non-infringing uses.  The medicament must be made and sold for the specific therapeutic use recited in the Swiss type claim.  So how is the court to determine this?  Does it need to know the subjective intentions of the manufacturer?  Must there be some objective evidence of the manufacturer’s intentions, e.g. that it was at least reasonably foreseeable that the product would be used for the claimed purpose?  Or is it, perhaps, enough to establish that the medicament has, in fact, been used for the therapeutic purpose defined in the claim?  In which case, might it also be necessary to establish the extent of such use, and the reasons why it was used for this purpose?

We can see, therefore, that the question of infringement of Swiss type claims is a vexed one, to say the least!

Swiss Type Claims Would not Have Been Infringed

At first instance (Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2019] FCA 28) the primary judge found that infringement of a Swiss type claim was dependent on the manufacturer’s intentions.  In particular, he stated (at [102]):

The crucial question is whether the manufacturer has made (or will make) the relevant medicament with the intention that it be used in the treatment of the designated condition. In my view, the answer to that question is to be ascertained objectively in light of all the relevant facts and circumstances including, in particular, the [patient information] for the product, any product labelling, and the nature, size and other pertinent characteristics of the market into which the product is to be sold.

The Full Court disagreed, finding (at [222]) that it is the alleged infringers actions, rather than its intentions, that are the primary consideration:

As a matter of claim construction, we do not read Swiss type claims, such as those in this proceeding, as adding a further essential feature to the invention, namely the manufacturer’s intention in making the medicament. …. Therefore, infringement of a Swiss type claim is concerned with what the allegedly infringing manufacturer has done, not what it intended to do. Bearing in mind the limited scope of such claims, a single factual question is presented when considering infringement: as the product of the claimed method or process, is the medicament for the specified therapeutic purpose? This question is directed to the characteristics of the manufactured product. It is answered having regard to all the circumstances of the case.

The Full Court went on (at [223]-[225]) to discuss various considerations that might inform the answer to the ‘single factual question’, which include:

  1. the physical characteristics of the medicament as it emerges as a product of the manufacturing process, including its formulation and dosage, packaging and labelling, and its patient information;
  2. evidence of the manufacturer’s actual intention in making the medicament, where available, which – while not determinative – would form part of the circumstances of the case to be taken into account;
  3. the reasonably foreseeable use or uses to which the medicament would be put after manufacture may also be a factor, however ‘the fact that it is reasonably foreseeable, or indeed likely, that a substantial portion of the manufactured medicament would also be used for the claimed therapeutic purpose will not be determinative of infringement’; and
  4. evidence of suitability for the claimed use is ambiguous because the medicament is known to have multiple uses, and thus suitability alone cannot be determinative of the question of infringement of a Swiss type claim.

In the present case, the Full Court found that the Swiss type claims, if valid, would not have been infringed, despite the fact that a substantial portion of the market for the generic product was for the claimed purpose, and the product information for the generic product described it as ‘bioequivalent to’ the patentee’s product, and thus presumably suitable for all the same therapeutic uses.  As stated by the Court, at [226], ‘the conjunction of these facts does not point persuasively to a conclusion that the [generic products] are medicaments for the specified therapeutic purpose’.

Method of Treatment Claims Would Have Been Infringed

Despite agreeing with the primary judge, albeit for different reasons, that the Swiss type claims would not have been infringed, the Full Court found no inconsistency in the primary judge’s finding that the method of treatment claims would have been indirectly infringed (had they been valid) under section 117 of the Patents Act 1990, with particular reference to subsection (2)(b).  The Full Court observed (at [224]) that ‘it might be reasonably foreseeable that a product might be put to a particular use’ without it necessarily following ‘that the product, as manufactured, is for that use.’

In other words, where a generic product is, in fact, prescribed and used for a purpose that would infringe a method of treatment claim, and it is reasonably foreseeable that this might occur, then the manufacturer can be held indirectly liable for that infringement, even in circumstances where it avoids infringement of a corresponding Swiss type claim.

Conclusion – Limited Application of Swiss Type Claims?

Barring a successful application for special leave to appeal to the High Court (which I think highly improbable), this decision of an expanded panel of five judges of the Federal Court of Australia is likely to be the last word on Swiss type claims in Australia for the foreseeable future. On this basis, it appears that Swiss type claims will be of very limited application against prospective infringers of patents relating to second and subsequent medical uses of known products. 

Given the Court’s focus on what the alleged infringer has actually done, rather than its (subjective or objective) intentions, it is difficult to imagine how anything far short of actively promoting, or at least encouraging, the use of a generic product for the purpose recited in a Swiss type claim could rise to the level of infringement.  Indeed, on the facts of this case it is apparent that infringement of such claims can be avoided even if the generic product has actually captured a substantial share of the market for the claimed therapeutic use.

Infringement of method of treatment claims, however, is another matter.  If, in fact, a generic product is prescribed for a patented use, and it would have been reasonably foreseeable by the manufacturer that this would occur, then the manufacturer can be held liable as an indirect infringer.

It is likely that most practitioners will continue to recommend that patent applications relating to further therapeutic uses that are filed in Australia include both method of treatment and Swiss type claims. While it may now be difficult to imagine circumstances in which an informed generic manufacturer would act in a way that might infringe the Swiss type claims, the fact that the two different forms of claim generally target different primary infringers, with infringement being established by way of different evidence, means that there may yet be cases in which the additional protection offered by Swiss type claims remains valuable.  At the very least, the presence of Swiss type claims might serve to discourage the kinds of actions that could cause them to be infringed, e.g. by ensuring that generic manufacturers only seek regulatory approval for indications not covered by such claims (i.e. so-called ‘skinny labelling’).

For the most part, however, patentees should be prepared to rely principally on method of treatment claims, and the indirect infringement provisions of section 117.


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