Patents Bill - introduced at last

By Kate McHaffie

A Patents Bill has finally been introduced to the New Zealand Parliament. The Bill will ultimately replace the Patents Act 1953, which is modelled on the UK Patents Act 1949.

General comments on the Bill

In some ways the Bill is a welcome update of New Zealand practice. For example, the Bill introduces examination for obviousness, automatic publication at 18 months, and absolute novelty, all of which are standard in many countries. However, some aspects of the Bill do little to reverse the gradual decline in the level of protection available for pharmaceutical and biotech inventions in New Zealand.

Recent developments

It was recently announced that the United States will begin negotiations with New Zealand, along with Singapore, Chile, and Brunei, for a free trade deal.

The prospect of a free trade deal is good news for clients wanting patent law reform in New Zealand. To secure a free trade deal with the United States New Zealand will almost certainly have to change key aspects of its patent law, for example by providing for patent term extensions.

New Zealand will be having a parliamentary election in November. Irrespective of the free trade deal, a change in government may allow reconsideration of some of the policy decisions that informed the current Bill.

Significant aspects of the Bill

The following aspects of the Bill are most likely to concern our life sciences clients:

• The Bill does not provide for patent term extensions. This is notwithstanding the 2003 Biotech Taskforce recommendation that patent term extensions be provided to stimulate growth in the biotech sector.
• Methods of treatment, diagnosis, and surgery on humans are not patentable. This codifies the Court of Appeal’s ruling in Pfizer v The Commissioner of Patents. The Intellectual Property Office of New Zealand (IPONZ) is likely to rely on these exclusions to resist developments to patentability in this area.
• The Bill retains the springboarding provision in the current Patents Act. This provides that it is not an infringement to work a patent to produce information for regulatory purposes. Generic pharmaceutical companies can obtain regulatory approval for their products while the innovator product is still on patent, and be ready to launch as soon as the patent expires. Most countries that have a springboarding provision temper it with a provision for patent term extensions.
• The ‘contrary to morality’ objection has been broadened. Under the new Act, the Commissioner of Patents will be able to object to an invention the commercial exploitation of which would be contrary to public order or to morality. IPONZ has signalled that it will rely on this provision to object to claims covering ‘controversial’ subject matter, such as stem cells, placental and umbilical cord tissues, and human embryos.

A unique opportunity for patent law reform

We will get a chance to make submissions on the Bill before it is passed into law. With an upcoming election and the chance of a new government, it is likely that the Bill won’t reach the submissions stage until next year.

We suggest that life sciences clients that are interested in patent law reform in New Zealand should use the next few months to establish their position and strategy.

If you would like to talk about making submissions on the Bill, please contact Kate McHaffie or your A J Park contact.

Some recent decisions from IPONZ

By Kate McHaffie

The past year has seen several decisions published that clarify the boundaries of patentability in New Zealand.

AstraZeneca’s applications (P23/2007 and P24/2007)—novel patient group

AstraZeneca claimed the use of a drug in the treatment of a particular patient group with breast cancer. The drugs were known to treat breast cancer, but not to treat the patient groups claimed.

The examiner objected on the basis that the claimed inventions were not novel, and that in any case claims where the novelty lies solely in the patient group to be treated are not allowable as they do not disclose a patentable invention.

The Assistant Commissioner found that the claims of the two patents each disclosed a clear improvement in an existing therapy and were allowable. The Assistant Commissioner found that both sets of claims satisfied the test set down by the EPO Technical Board of Appeal in Medco Research/Adrenaline (T233/96) for assessing whether a claimed patient group provides sufficient novelty.

Epicept’s application (P29/2007)—novel means of drug delivery

The applicant claimed, in the Swiss form, the use of a local anaesthetic for the manufacture of a topical formulation contained in a patch for treating pain. It was known to inject or implant anaesthetic below the surface of a wound, but the prior art did not disclose using anaesthetic patches for the treatment of pain associated with surgically closed wounds.

The Assistant Commissioner found that the claims to a novel means of administering anaesthetic to a wound were allowable.

Biosite’s application (P31/2007)—method of prognosis

The applicant claimed a method of determining prognosis for a patient using B-type natriuretic peptide (BNP). Levels of BNP provide a useful prognostic indicator for patients with acute coronary syndromes.

The examiner took the position that the claims did not disclose a patentable invention. The Assistant Commissioner disagreed. He found that the claimed method was not an unpatentable method of medical treatment. Further, he found that the method was more than a mere scheme or plan, had a tangible result, and was patentable.

WARF's applications (P22/2007)—claims covering stem cells, ‘contrary to morality’

The patents claimed an in vitro method for directing the differentiation of primate embryonic stem cells into cells of endothelial lineage (NZ 532170), and a method to induce primate stem cells to directly differentiate into primate trophoblast cells (NZ 535243).

The examiner objected to the claims on the basis that the starting point of each method is primate (human) stem cells that are capable of developing into a complete human being (although evidence filed by the applicant showed that this was a flawed analysis). The examiner stated that methods conducted on such cells are contrary to morality.

The Assistant Commissioner found that ‘contrary to morality’ means ‘diametrically opposed to behaviour which New Zealand society believes to be right conduct, that belief being deeply rooted in our culture’. The Assistant Commissioner accepted that there is no deeply rooted belief against stem cell research amongst the New Zealand population as a whole. He found that stem cell research of the type claimed is not considered by the state as inherently ‘contrary to morality’ and is allowed provided certain conditions are satisfied. Therefore, it is not appropriate for IPONZ to act as a further arbiter of morality. The Assistant Commissioner allowed the claims.

Likely impact of the new Patents Act

We anticipate examiners will use the power to examine for obviousness that they will obtain under the new Patents Act to restrict the applicability of cases such as AstraZeneca and Epicept, as well as earlier decisions allowing claims to novel dosage regimes (Arrow v Merck (P3/2006), Genentech (P1/2007)).

IPONZ examiners are currently refusing to apply the WARF decision. IPONZ has signalled its intention to rely on the broadened ‘contrary to morality’ provision under the new act to object to a range of ‘controversial’ subject matter, including inventions involving totipotent human stem cells, and human embryos and processes requiring their use.

Selection inventions

By Sue Rutledge

The recent UK Patents Court decision in the case of Dr Reddy’s v Eli Lilly is of interest to those involved in chemical and pharmaceutical inventions. It raises issues about the validity of patents for individual compounds selected from a prior class – so called “selection inventions”.

If not overturned on appeal, and if followed by New Zealand courts, this decision may be helpful to patentees. It means that a selection invention may not be subject to the traditional requirement to disclose advantages of the selection.

The case related to Eli Lilly’s widely prescribed antipsychotic drug, olanzapine, used to treat schizophrenia. The patent at issue described and claimed olanzapine and its salts. Eli Lilly also had an earlier patent to a broad class of compounds that covered but did not specifically disclose olanzapine. Dr Reddy’s alleged that the later olanzapine patent was invalid because it lacked novelty, inventive step or both over Eli Lilly’s earlier class patent and several other publications.

Floyd J noted that the UK courts and the European patent office (EPO) had taken slightly different approaches to selection inventions. The traditional UK approach applied strict criteria, requiring that a selection invention must indicate in the patent specification a “substantial advantage” of the selection over the broader, previous disclosed group. Other requirements were that the advantage must be displayed by all members of the selection but not by the rest of the larger class. In contrast, the EPO approached the issue as one of basic novelty and obviousness. Concerning novelty, a compound is considered novel unless it is individually disclosed in the prior art. When considering obviousness, new advantages of the selected product may be relevant, but not necessarily.

Ultimately, Floyd J preferred the approach of the EPO, and felt that the case could be decided on consideration of novelty and obviousness. He found that although molecules similar to olanzapine were described in the prior art, a research program would be required to identify olanzapine, with no specific expectation of success. This meant that the compound olanzapine was not obvious.

The decision is unlikely to affect the practice of IPONZ examiners, at least in the short term. This is because examiners are not permitted under our current law to raise objections that an invention is obvious – they can only object that the invention is not new. However, this may change when the new Patents Bill is passed and examination for obviousness is implemented.

We welcome your queries and feedback

If you would like to discuss any of the issues we have raised in this issue of Biophile, or have feedback to give us about our newsletter, please contact any member of our team.