Conditions for a valid selection patent does not constitute an independent basis for attacking validity

August 18, 2010

Eli Lilly Canada Inc., Eli Lilly and Company, Eli Lilly and Company Limited and Eli Lilly SA v. Novopharm Limited (2010 FCA 197)

Eli Lilly, the plaintiff in a patent infringement action, was successful in appealing a decision of the Federal Court which had found Eli Lilly’s Canadian Letters Patent No. 2,041,113 (the ‘113 Patent) relating to the medicine olanzapine (Zyprexa) invalid on the basis that it was not a proper selection patent.  The core issue on appeal raised a single question: do the conditions for a valid selection patent constitute an independent basis upon which to attack the validity of a patent?

Eli Lilly had previously received a patent (the ‘687 Patent) in 1980 covering approximately 15 trillion thienobenzodiazapine compounds, the properties of which were said to be useful for treating mild anxiety and certain psychotic conditions.  Although olanzapine was encompassed within the scope of the ‘687 Patent, it was not specifically disclosed.  Following the issuance of the ‘687 Patent, Eli Lilly eventually ceased its studies on the compounds specifically identified in that patent, but began to synthesize seven new compounds, of which olanzapine was the most promising.
 

Eli Lilly filed the application for the ‘113 Patent in April 1991, and it was subsequently issued in July 1998.  The ‘113 Patent disclosed that Lilly “discovered a compound [olanzapine] which possesses surprising and unexpected properties by comparison with flumezapine and other related compounds.”  It also referred to other perceived advantages of olanzapine over prior-known antipsychotic agents not included in the genus ‘687 Patent.

The Court of Appeal noted that a valid selection patent may be issued where “a property, quality or use in relation to one or more members of the genus is subsequently discovered … Selection patents exist to encourage researchers to further use their inventive skills so as to discover new advantages for compounds within the known class.”  The Court of Appeal, however, asserted that selection patents must be assessed in the same way as any other patent:

[A] challenge directed to a determination that the conditions for a selection patent have not been met does not constitute an independent basis upon which to attack the validity of a patent. Rather, the conditions for a valid selection patent serve to characterize the patent and accordingly inform the analysis for the grounds of validity set out in the Act – novelty, obviousness,sufficiency and utility. In short, a selection patent is vulnerable to attack on any of the grounds set out in the Act.

In this respect, according to the Court of Appeal, the trial judge committed an overriding error when he essentially merged the doctrines of utility, obviousness and sufficiency, and concluded right from the outset that the ‘113 Patent was not a valid selection patent.  The trial judge’s initial conclusions coloured his analysis throughout the remainder of his judgment, and led the Court of Appeal to overturn numerous findings as to anticipation and obviousness.

In addition, the Court of Appeal remitted the issues of utility and sufficiency back to the Federal Court as there was insufficient evidence on record relating to the patent’s promise: “The failure to provide any foundation for the construction of the patent’s promise leaves this Court without any basis upon which to conduct a meaningful review. In the absence of an accurate articulation or ascertainment of the promise, review of the analysis of the alleged advantages is not possible because they cannot be viewed in relation to the overarching promise of the patent.”

Given this remittance, the patent bar eagerly awaits the trial judge’s findings, as clarification of disclosure requirements in the area of selection patents is undoubtedly needed.
 

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