BETWEEN:
PFIZER CANADA INC. and PFIZER LIMITED
and
THE MINISTER OF HEALTH and RATIOPHARM INC.
Heard at Ottawa, Ontario, on May 24, 2006.
Judgment delivered at Ottawa, Ontario, on June 9, 2006.
REASONS FOR JUDGMENT BY: MALONE J.A.
CONCURRED IN BY: LINDEN J.A.
LÉTOURNEAU J.A.
Docket: A-75-06
Citation: 2006 FCA 214
CORAM: LINDENJ.A.
LÉTOURNEAU J.A.
MALONE J.A.
BETWEEN:
PFIZER CANADA INC. and PFIZER LIMITED
Appellants
and
THE MINISTER OF HEALTH and RATIOPHARM INC.
Respondents
REASONS FOR JUDGMENT
[1] This appeal relates to Canada Patent #1,321,393 (the '393 Patent) issued in 1987, whereby Pfizer Limited (Pfizer) claims a selection patent over the invention of amlodipine besylate (Besylate), a salt of amlodipine. At issue is whether Pfizer's research leading up to this claim involved only mere verification of Besylate's formulation properties or whether its analysis amounted to the actual invention of Besylate, so as to permit Pfizer to claim a selection patent.
[2] The appellants appeal the February 17, 2006 order of a Federal Court judge (the Applications Judge) that their application pursuant to the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 (the NOC Regulations) for an order prohibiting the Minister of Health (the Minister) from issuing a Notice of Compliance (NOC) to Ratiopharm Inc. (Ratiopharm) until after the '393 Patent expired (reported as 2006 FC 220).
[3] There are two general classes of chemical patents. The first is the 'originating patent' where there is an originating invention involving the discovery of a new reaction or a new compound. The second is the 'selection patent', which is based on a selection from related compounds derived from the original compound and which have been described in general terms and claimed in the originating patent (see In the Matter of I.G. Farbenindustrie A.G.'s Patents, (1930) 47 R.P.C. 283 at page 321 per Maugham J.).
[4] While there is little Canadian jurisprudence on the subject of selection patents, its elements are well defined in I.G. Farbenindustrie. Lord Diplock cited this decision with approval in the House of Lords where he stated that the 'inventive step in a selection patent lies in the discovery that one or more members of a previously known class of products possess some special advantage for a particular purpose which could not be predicted before the discovery was made' (see Beecham Group Ltd. v. Bristol Laboratories International S.A. [1978] R.P.C. 521 at page 579). All claimed members of the known class must have the advantage and the advantage must not be one that those skilled in the art would expect to find in a large number of the previously disclosed class (i.e. a quality of special character) (see I.G. Farbenindustrie at page 323).
[5] Selection patents exist to encourage researchers to further use their inventive skills so as to discover new advantages for compounds within the known class. A selection patent can be claimed for a selection from a class of thousands or for a selection of one out of two (see for example I.G. Farbenindustrie at page 323 and E.I. Dupont de Nemours & Co (Witsiepse's) Application,[1982] F.S.R. 303 (H.L) at page 310).
II. FACTS
[6] In September 1983, Pfizer applied for European Patent Application # 0 089 167 (the EPA). The EPA is an originating patent which claims the discovery of certain dyhydropyridines which included amlodipine and their pharmaceutically acceptable salts to be used as an anti-ischaemic or anti-hypertensive agent. The EPA indicates that 'the preferred salts are maleates'.
[7] Pharmaceutically acceptable salts refer to the eighty anions identified in the seminal and authoritative article by Stephen Berge, dated January 1977, in the Journal of Pharmaceutical Sciences entitled "Pharmaceutical Salts". Mr. Berge lists approximately eighty salts within amlodipine including Besylate.
[8] The development and formulation of a new drug can be complicated, time-consuming and difficult. One difficulty is ensuring that the final dosage form will have properties that permit it to be readily manufactured, stored, transported and sold.
[9] A search for an alternative salt form became necessary when Pfizer found that the maleate salts could not be formulated into a suitable dosage form. These problems related to poor stability and processability, and were significant enough to warrant the unusual step of halting amlodipine's development after the commencement of human clinical studies. Pfizer therefore decided to try to find a new salt for amlodipine in response to these formulation problems.
[10] Salt selection is also a very difficult and time-consuming process. Not surprisingly, Pfizer wanted the replacement salt to have an optimal combination of formulation properties, namely: (1) be soluble enough to be absorbed by the body; (2) be as stable as possible; (3) be as non-hygroscopic as possible; and (4) be as easily processed as possible (non-stickiness) (collectively the Formulation Properties). After conducting further research, Pfizer selected Besylate.
[11] Pfizer asserts that the '393 Patent is a valid selection patent. The only invention claimed in the '393 Patent is the selection of Besylate from the class of some eighty pharmaceutically acceptable salts of amlodipine. The disclosure in the '393 Patent states that Besylate was selected because of the discovery of its unusual combination of desirable properties when preparing pharmaceutical formulations. The disclosure further reveals that Besylate was tested against seven other pharmaceutically acceptable salts of amlodipine in respect of the Formulation Properties. On the basis of these tests, the disclosure asserts that:
It has now unexpectedly been found that the benzene suphonate salt (hereinafter referred to as the besylate salt) has a number of advantages over the known salts of amolodipine and, additionally has unexpectedly been found to have a unique combination of good formulation properties which make it particularly suitable for the preparations of pharmaceutical formulations of amlodipine. ('393 Patent)
(Emphasis added.)
[12] Pfizer markets and sells Besylate under the brand name NORVASC. Pfizer has two patents in Canada listed against NORVASC; the '393 Patent and Canadian Patent #1,253,865 ('865 Patent). The '865 Patent is the Canadian counterpart of the EPA and it expired on May 8, 2006. It is not part of this appeal.
[13] In these proceedings where Pfizer seeks the issuance of an order prohibiting the Minister from issuing an NOC which would allow Ratiopharm to produce a generic version of Besylate tablets after the '865 Patent expired, Pfizer has the burden of demonstrating on a balance of probabilities that Ratiopharm's allegations of non-infringement of the patent or its invalidity are not justified (see Pfizer Canada Inc. v. Novapharm Ltd. (2005), 42 C.P.R. (4th) 97 (FCA)).
III. DECISION BELOW
[14] While the Applications Judge canvassed a number of other issues, the focus of his analysis ultimately relates to verification and the law surrounding selection patents. After considering the more developed case law from the United Kingdom on this issue, he concluded that because of the lack of rationale and explanation for why certain salts from a known class were tested there was no disclosure of special advantage. Since the purpose of selection patents is to reward the inventor for discovering hitherto unknown characteristics peculiar to the members of the selection, the absence of explanation or justification convinced the Applications Judge that this was merely an exercise in verifying existing properties and testing the degree of known characteristics, which is not patentable.
IV. STANDARD OF REVIEW
[15] Errors of law are to be reviewed on a correctness standard (see Housen v. Nikolaisen, [2002] 2 S.C.R 235). However, sometimes an error of mixed fact and law can also amount to an error of law that attracts the correctness standard as was demonstrated in Canada (Director of Investigation and Research) v. Southam, [1997] 1 S.C.R. 748. There, Iacobucci J. stated:
...if a decision-maker says that the correct test requires him or her to consider A, B, C, and D, but in fact the decision maker considers only A, B, and C, then the outcome is as if he or she had applied a law that required consideration of only A, B, and C. If the correct test requires him or her to consider D as well, then the decision-maker has in effect applied the wrong law, and so has made an error of law.
[16] In my analysis, the question of whether the Applications Judge applied the correct test when he determined that "Pfizer's research amounted to no more than verifying existing properties (or their degree) and was not inventive" is to be reviewed on a correctness standard.
V. PRELIMINARY ISSUE
[17] Before dealing with the main issue on appeal, it is necessary to deal with one preliminary issue. In its NOA, Ratiopharm alleged that Besylate offered no substantial or practically significant improvement in stability over any of the other salts tested in the '393 Patent, and in particular, over amlodipine maleate.
[18] The Applications Judge found that Ratiopharm's NOA was inadequate because it did not include the results of tests conducted by Dalton Chemical Laboratories Inc. (the Dalton Tests) prior to the date of the NOA. These tests relate to stability tests on Besylate, amlodipine maleate and tablet formulations of Besylate and amlodipine maleate. As a result of this finding, the Applications Judge disregarded the evidence of the Dalton Tests.
[19] Although, for the purposes of this appeal, Ratiopharm is not asking this Court to consider the evidence of the Dalton Tests, Ratiopharm urges that this Court distance itself from the finding of the Applications Judge on the sufficiency of its NOA when he stated "the Dalton Testing results represent new facts that should have been alleged in the NOA." According to Ratiopharm, this amounts to a new procedural requirement that each NOA now becomes a lengthy document setting forth the evidence to sustain the facts alleged.
[20] I do not read the words of the Applications Judge in that way. In my view, all he is saying is that the NOA should have included a brief description of the test results sufficient for the party opposite to know the case to be met. That complies with the recent decision of this Court in Pfizer v. Novopharm (supra at paragraph 13) and nothing more is required.
VI. ANALYSIS
(i) Verification
[21] It is important at the outset to establish that empirical research for the purpose of making a selection from a class is not verification. Lord Wilberforce in Beecham (supra at paragraph 4) noted that the selection of some from a larger number of possible components and the exploration of their appropriateness by empirical investigation is a different thing from verification and leads to different results (at page 568).
[22] The empirical investigation leading to an invention protected by a selection patent must involve "at the least the discovery that the selected members possess qualities hitherto undiscovered, particular to themselves and not attributable to them by virtue of the fact of their belonging to a class specified by an earlier invention" (see Dreyfus and Other Applications (1945), 62 R.P.C. 125 at page 133 per Evershed J.).
[23] In Pope Alliance Corporation and Spanish River Pulp and Paper Mills, Limited, [1929] A.C. 269 (H.L.) Viscount Dunedin at pages 250-251 noted that "invention is merely finding out something which has not been found out by other people." An inventor is entitled to a patent where he can show that his efforts led to a discovery of certain knowledge central to his invention. It is no answer that others by experiment might have also found it (see also T.A. Blanco White, Patents for Inventors and the Protection of Industrial Designs, 5th edition: (London: Stevens & Sons, 1983) at page 99).
[24] On the other hand, verification means confirming predicted or predictable qualities of known compounds; i.e. components that have already been discovered and made. No one can claim a selection patent merely for ascertaining the properties of a known substance (see SmithKline Beecham Pharma Inc. v. Apotex Inc. (2002), 21 C.P.R. (4th) 129 (FCA) at paragraph 21).
[25] The appellants assert that, based on the forgoing legal principles, the '393 Patent meets the criteria for a valid selection patent when the following uncontested facts and the findings of the Applications Judge are considered:
1. salt selection can change the properties of the molecule and is used to optimize a compound's combination of Formulation Properties; (Reasons at paragraph 39)
2. a skilled person would neither know nor predict the Formulation Properties of a salt, and therefore there is no way of knowing which particular salt of a drug, if any, will be the best for a particular purpose, until the salts are made and tested (Reasons at paragraphs 39 and 40);
3. in conducting salt selection, no skilled person would ever make and test all possible salt candidates, but instead would select a small group to make and test (Reasons at paragraph 40);
4. a skilled person might not have included Besylate in the group of amlodipine salts to make and test (Reasons at paragraph 39);
5. the prior art does not specifically disclose Besylate, nor teach a skilled person why to select the Besylate, what the Besylate's properties will be, or its advantages for pharmaceutical formulation (Reasons at paragraphs 41 and 42);
6. a skilled person looking for a salt of amlodipine to make into an oral dosage form would look for an optimal combination of solubility, stability, non hygroscopicity and processability (Reasons at paragraph 39);
7. as a result of the inventors' research and given the previous discussion giving no weight to the Dalton Testing, it is now known that, from the salts tested, Besylate has the best combination of these properties (Reasons at paragraph 24 and the '393 Patent); and
8. a skilled person would not know which other salts of amlodipine could be formulated into a dosage form, much less which salts would have equally good or better Formulation Properties for this purpose.
[26] In opposition, Ratiopharm argues that the Applications Judge was correct to hold that the '393 Patent teaches 'mere verification', relying on an old English Court of Appeal decision in Sharpe & Dohme Inc. v. Boots Pure Drug Company Ltd. (1928), 45 R.P.C. 153 (CA). In that case, Sargant L.J. opined that it is verification and not invention to ascertain the valuable properties of a chemical substance obtained through the usual, well-known tests to establish their identity and their respective therapeutic value.
[27] In my view, the learned Applications Judge erred when he concluded that the investigation conducted by Pfizer amounted to mere verification. As we have seen, verification deals with compounds already discovered and made, yet as the Applications Judge found, and as all five experts admitted, the Formulation Properties of any salt of amlodipine could never have been expected but must be determined empirically (Reasons at paragraph 39). Had he applied the principles enunciated in I.G. Farbenindustrie (supra at paragraph 3), Beecham (supra at paragraph 4), E.I Dupont (supra at paragraph 5) and Dreyfus (supra at paragraph 22) to his factual findings, the Applications Judge could only conclude that the '393 Patent is a valid selection patent because of Pfizer's discovery of Besylate's special Formulation Properties creating a special advantage in dosage stability and processability. In essence, as stated by the Supreme Court of Canada in Southam (supra at paragraph 15), the Applications Judge effectively applied the wrong test, thus leading to a legal error.
(ii) Special Advantage
[28] According to Ratiopharm, the Applications Judge was also correct to question the lack of certain essential details surrounding its discovery of Besylate's 'unique combination' of properties. Ratiopharm urges that if Pfizer need only assert that the 'unique combination' of Besylate's Formulation Properties cannot be predicted and therefore possess an unexpected advantage, then any amlodipine salt selected could be tested against any number of properties which could theoretically support a claim to 'unique properties' that could not be predicted. They argue that this is absurd and that more disclosure details of selection of comparator salts, Formulation Properties and fully explained thresholds for acceptable results are essential to support Besylate's special advantage over the class.
[29] In rejecting Pfizer's claim that Besylate was unexpectedly found to have a 'unique combination" of good formulative properties the Applications Judge wrote at paragraphs 52 through 54:
...all four factors had a totally unexplained minimum threshold. No evidence was presented to show that any of the four characteristics were not known beforehand. Similarly, no evidence was provided to justify the minimum threshold in terms of regulatory requirements, industry standards, ease of production or minimization of costs.
...
Any combination of the four characteristics in the nine salts can qualify as unique, and as being particularly suitable for pharmaceutical preparations of amlodipine, so long as no rationale is given for choosing the minimum threshold. Any alteration of these thresholds could result in another salt having 'a unique combination of good formulation properties which make it particularly suitable for the preparations of pharmaceutical formulations of amlodipine'. In effect, these thresholds can be manipulated to get the outcome one desires.
...
The purpose of selection patents is to reward the inventor for discovering hitherto unknown characteristics peculiar to the members of the selection. The purpose is not to permit the creation of valid selection patents simply by allowing an 'inventor' to test the degree of known characteristics, setting unexplained minimum thresholds without any justification, and then claiming any product that meets the combination of these characteristics is unique.
[30] According to Pfizer, this analysis contains two legal errors. In considering thresholds, it sets the bar too high on what constitutes special advantage, and in any event, thresholds were not put in issue by Ratiopharm's NOA.
[31] To meet the statutory requirement in subsection 34(1) of the Patent Act, R.S.C. 1985, c. P-4 (old Act) that a patent be 'useful', the selected species must have an advantage over the class as a whole (see Consolboard Inc. v. MacMillan Bloedel (Saskatchewan) Ltd., [1981] 1 S.C.R. 504 at pages 525-526). That case broadly defined the utility required for valid patent as discussed in Halsbury's Laws of England (3rd ed.), vol 29 at page 59:
...it is sufficient utility to support a patent that the invention gives either a new article, or a better article or a cheaper article, or affords the public a useful choice.
However, there are no special legal requirements regarding what particular type of advantage is required. The test for advantage is understood to include a disadvantage to be avoided, as is the case here (see I.G. Farbenindustrie at page 322).
[32] The Applications Judge was also concerned that the thresholds could be manipulated, and commented that there was no evidence offered by Pfizer to justify them. However, he failed to recognize that there was little evidence on the issue of thresholds because Ratiopharm never objected to them in its NOA. Threshold issues had to be raised in the NOA so that Pfizer could know the case it had to meet (see Pfizer v. Novapharm (supra at paragraph 13)). Deciding a case on a theory not raised by parties may give rise to an argument for procedural unfairness.
[33] In summary, the Applications Judge's erroneous application of the principle of verification caused him to conclude that Besylate had no "special advantage" or "quality of a special character" capable of supporting a selection patent. In my analysis, based on the uncontested facts and the findings of the Applications Judge, Besylate has, in terms of stability, solubility, non-hygroscopicity and processability, both a special advantage and quality of a special character, thus giving rise to a valid claim for a selection patent.
(iii) Anticipation
[34] One further issue raised by Pfizer requires comment. With respect to anticipation, the Applications Judge held that the EPA did not anticipate the '393 Patent. In coming to this conclusion, he cited Shore J. in Sanofi-Synthelabo Canada Inc. v. Apotex Inc., (2005), 39 C.P.R. (4th) 202, in stating that when determining whether a patent was anticipated, the question to be answered is whether a person skilled in the art was given such a clear direction by the EPA that in every case and without possibility of error he would make the salt claimed in the '393 Patent. Since testing all of the pharmaceutically acceptable salts disclosed in the EPA would require millions of tests, the Applications Judge held that the '393 Patent was not anticipated.
[35] The applicable standard of review for anticipation is palpable and overriding error because it is a question of mixed fact and law. In my analysis, the Applications Judge did not make a palpable and overriding error in determining that the '393 Patent was not anticipated. The test for anticipation was laid out in Beloit Canada Ltd. v. Valmet OY(1986), 8 C.P.R. (3d) 289 (F.C.A.) and adopted by the Supreme Court of Canada in Free World Trust v. Electro Santo Inc. (2000), 9 CPR (4th) 168. It reads as follows:
One must, in effect, be able to look at a prior, single publication and find in it all the information which, for practical purposes, is needed to produce the claimed invention without the exercise of any inventive skill. The prior publication must contain so clear a direction that a skilled person reading and following it would in every case and without possibility of error be led to the claimed invention.
[36] This is a difficult test to meet. The Applications Judge held that a person skilled in the art would not know why to select Besylate as one of the initial choices of salt, would not know whether it would form a salt of amlodipine in the solid state and would not know the particular properties of Besylate or their advantage for pharmaceutical formulation. As a result of these facts, he found that a person skilled in the art would not in every case and without possibility of error be led to the claimed invention. In so doing he did not make a palpable and overriding error because there was evidence on which to base his findings.
VII. CONCLUSION
[37] I would allow the appeal with costs and set aside the order of the Applications Judge dated February 17, 2006. Proceeding to render judgment that he should have rendered, I would allow the appellants' application with costs and issue an order prohibiting the Minister from providing an NOC to Ratiopharm in respect of its proposed amlodipine besylate products, until the expiry of the '393 Patent.
I agree.
A.M. Linden J.A."
"I agree.
Gilles Létourneau J.A."
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-75-06
APPEAL FROM A JUDGMENT OR AN ORDER OF THE FEDERAL COURT DATED FEBRUARY 17, 2006, FEDERAL COURT FILE NO. T-1350-04
STYLE OF CAUSE: PFIZER CANADA INC. ET AL. v. THE
MINISTER OF HEALTH ET AL.
PLACE OF HEARING: Ottawa, Ontario
DATE OF HEARING: May 23 & 24, 2006
REASONS FOR JUDGMENT BY: Malone J.A.
CONCURRED IN BY: Linden J.A.
Létourneau J.A.
DATED: June 9, 2006
APPEARANCES:
Ms. Sheila R. Block for the Appellants
Mr. Andrew M. Shaughnessy
Mr. Andrew E. Bernstein
Mr. Glenn A. Bloom for the Respondent, Ratiopharm Inc.
Mr. David W. Aitken
Mr. Matthew R. Castellarin
SOLICITORS OF RECORD:
Torys LLP for the Appellants
Toronto, Ontario
Osler, Hoskin & Harcourt LLP for the Respondent, Ratiopharm Inc.
Ottawa, Ontario