Source: http://www.sufficientdescription.com/2011/11/olanzapine-patent-invalid-on-remand-not.html
Timestamp: 2019-04-19 12:16:29+00:00

Document:
In Eli Lilly Canada Inc. v. Novopharm Ltd. / olanzapine (No 1) 2009 FC 1018 O’Reilly J held Lilly’s olanzapine patent, 2,041,113, to be an invalid selection patent over the genus patent 1,075,687. On the appeal, the FCA held that invalid selection is not an independent basis upon which to attack the validity of a patent (2010 FCA 197, , , ), and that O’Reilly J’s finding of invalidity was fatally tainted by this error. The FCA held that the patent was neither anticipated and nor obvious, nor was it invalid for double patenting, but it remitted the case to O’Reilly J on the issues of utility and sufficiency.
On remand, O’Reilly J has held there was sufficient disclosure, but the 113 patent is invalid for lack of utility. As always in Canadian cases dealing with utility, the first question is construing the promise of the patent. Layden-Stevenson J giving the decision of the FCA in olanzapine (No 1) stated that she would be inclined to construe the patent as promising “that olanzapine, in the treatment of schizophrenia, shows marked superiority to flumezapine and other '687 compounds, has a better side effects profile than prior known antipsychotic drugs and has a highly advantageous activity level” . She did not conclude the point as she did not have the benefit of the expert evidence, but she remitted this issue to O’Reilly J as part of the utility question. O’Reilly J has taken the hint and in effect construed the patent in exactly in this manner: . Note that there are two distinct promises: olanzapine must be superior to (1) prior known antipsychotics; and (2) other '687 compounds, in particular flumezapine. These are distinct points because no '687 compound had been used as an antipsychotic. While O’Reilly J’s decision runs these two points together, as both are encompassed in the promise of the patent, it is convenient to treat them separately. I will deal with the second promise in a subsequent post.
The first promise, that olanzapine is superior to known antipsychotics, raises the basic utility question: how soon is too soon to patent? O’Reilly J made this clear in his conclusions: “In circumstances where the patent-holder has not established ‘utility by tests or sound prediction at the time it applied for its patent, then it was offering nothing to the public but wishful thinking in exchange for locking up potentially valuable research turf for (then) 17 years,’” quoting Binnie J in Wellcome / AZT 2002 SCC 77 at . However, it is not right to say that Lilly offered nothing but wishful thinking. The utility was measured by the promise of the patent, and that was crucial: O’Reilly J stated expressly that “[i]f the utility of the invention in the ‘113 patent relates merely to a compound with potential antipsychotic properties that might have relatively low EPS liability, that utility had been demonstrated by the tests conducted prior to the filing date”  (emphasis added).
A first and fundamental question is therefore whether it is right to measure utility against the promise of the patent. Clearly the answer is yes according to current Canadian law, but as I have pointed out previously, Canadian law is unique in this respect, and therefore cannot be assumed to be correct as a matter of policy. I have criticized the false promise doctrine in many previous posts. To summarize, there are two adverse consequences of measuring the utility of an invention by the promise of the patent. First, it may result in the invalidation of a patent on what can only be described as a technicality. A patent for an invention which may be perfectly useful, indeed, as in this case, a blockbuster, and so which might have been entirely valid had the drafter framed the disclosure correctly, may be invalidated on the basis of language in the claims which the drafter would have been perfectly free to omit. It might be said that in that case the drafter could have omitted the language giving rise to a heightened utility obligation. But this raises the second problem, which is that determining the problem of the patent is an essentially arbitrary enterprise. The promise of the patent becomes crucial to the validity of the patent, yet the disclosure has always been intended to explain the invention, rather than determine its validity, a task which was left to the claims. Moreover, the doctrine is not known in any other jurisdiction, and indeed it was not known in Canada in its currently vigorous form at the time that many of the patents in litigation today were being drafted. The result is that a question which did not occur to the patent drafter, becomes central to the validity.
A second question raised by the decision turns on the point made recently by the FCA that “[t]he soundness of prediction is a matter of fact,” Sanofi-Aventis Canada Inc v Apotex Inc / ramipril, 2011 FCA 300. O’Reilly J made the same point at . While to some extent every case must turn on its own facts, I noted in last week’s post that if this principle is carried too far it becomes difficult for a patentee to know when it has carried its research far enough to apply for a patent, as it is not possible to extract guidance from the cases. So, in this case O’Reilly J distinguished on the facts a number of other cases in which patents had been held to be valid on the basis of what was arguably less testing. It is interesting to note that in the English olanzapine litigation, Dr Reddy’s Laboratories v Eli Lilly  EWCA Civ 1362, Jacob LJ remarked of exactly the same disclosure that “[s]o far as my experience goes, this information is much greater than that generally provided in a patent for a new pharmaceutical compound” . That O'Reilly J nonetheless found the information insufficient to establish utility reflects both the idiosyncratic nature of the Canadian false promise doctrine, as well as the ad hoc nature of characterizing utility as a purely factual determination.
Despite my misgivings, O’Reilly J is on firm ground on these points. The crucial aspect of the decision, as always in pharmaceutical patents, is construing the promise of the patent. While I have criticized this practice, it is firmly established in Canadian law, and in this case, O’Reilly J has simply confirmed the construction advanced by the FCA. The second point, that soundness of prediction is a matter of fact, is perhaps not quite as firmly entrenched, but has not generally been controversial. It is worth noting that Jacob LJ in the EWCA in HGS v Eli Lilly  EWCA Civ 33 took the same position as O’Reilly J, and distinguished prior similar cases in much the same way. The UKSC  UKSC 51 nonetheless reversed, as it was able to discern some useful lower-level principles: see my post here. It will be interesting to see if the FCA will take the opportunity to similarly establish principles capable of providing guidance to inventors as to when they can apply for a patent with confidence that it will be valid. This seems unlikely given the FCA’s recent pronouncement that the soundness of prediction is a matter of fact, and the false promise doctrine undermines any hope of predictability in any event.
A third point is that O’Reilly J also referred at - to the decision in Pfizer Canada Inc. v. Apotex Inc. / latanoprost (NOC) 2011 FCA 236, in which the FCA held in effect that a patent for an invention useful for the treatment of a chronic disease must be construed as promising practical usefulness in long-term treatment, and so must be supported by long-term studies. While the FCA latanoprost decision was quite clear on this point, this decision is so extremely problematic that I would be surprised if it were not distinguished or even over-ruled in future decisions, and I cannot regard it as part of Canadian law until it is confirmed by another FCA decision. With that said, it is not clear how central it was to O’Reilly J’s holding. He did state that “it is essential to recognize the chronic nature of schizophrenia” , and see also , but taken as a whole my impression is that he would have come to the same conclusion even apart from this.
The result in this case is not particularly surprising in light of the relatively stringent promise of the patent as construed by the FCA in olanzapine (No 1). A judge inclined to be sympathetic to Lilly might have been able to exploit the factual nature of the sound prediction inquiry to hold that the promise was satisfied, but in the absence of guidelines, such decisions will remain ad hoc.
I should emphasize that I am not arguing that the olanzapine patent should be held to be valid. The principle that a patent may not be granted for a speculative invention is sound, and it may be that Lilly patented too soon. My objection is to the arbitrariness and unpredictability created by the uniquely Canadian false promise doctrine, and the consequent uncertainty as to patentability. The pharmaceutical industry depends on patent protection to fund research and development of drugs that benefit society at large, such as olanzapine itself. It would be to everyone’s benefit to have clear and stable rules that would allow pharmaceutical companies to know, rather than guess, when they have done sufficient research to apply for a patent with some assurance that it will be valid.

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