CATCHWORDS
PATENTS - infringement - application for injunction to restrain infringement - whether serious question to be tried - balance of convenience.
Patents Act, 1975 Cth, s 68
BRISTOL-MYERS SQUIB COMPANY v F.H. FAULDING & CO LIMITED
VG 109 of 1995
Olney J
Melbourne
23 March 1995
IN THE FEDERAL COURT OF AUSTRALIA )
VICTORIA DISTRICT REGISTRY )
GENERAL DIVISION ) No VG 109 of 1995
B E T W E E N:
BRISTOL-MYERS SQUIBB COMPANY
Applicant
F.H. FAULDING & CO LIMITED
Respondent
Coram: Olney J
Place: Melbourne
Date: 23 March 1995
REASONS FOR JUDGMENT
The applicant is the grantee of Australian Petty Patents Nos 641,894 (the first petty patent) and 651,307 (the second petty patent). The first petty patent was sealed on 30 September 1993, is currently in force and is due to expire on 29 January 1999. The second petty patent was sealed on 14 July 1994. It is currently in force and is due to expire on 13 July 1995 but, pursuant to s 68 of the Patents Act is capable of being extended for a term expiring on 15 December 1999. Each petty patent relates to an invention entitled "Methods for Administration of Taxol".
The claims defining the respective inventions are:
a) In the case of the first petty patent:
1. A method for administration of taxol to a patient suffering from cancer comprising infusing from 135 to 175 mgm/m2 of taxol over a duration not exceeding 6 hours.
2. The method of claim 1, wherein said administration comprises infusion of 135 mg/m2 of taxol.
3. The method of claim 2, wherein the duration of said infusion is not greater than 3 hours.
b) In the case of the second petty patent:
1. A method for treating cancer in a patient suffering therefrom including infusing from 135 to 175 mg/m2 of taxol over a duration less than 6 hours, wherein said method results in a reduction of haematological toxicity and neurotoxicity compared with infusing greater than 170 mg/m2 of taxol over a duration of 24 hours.
2. A method according to claim 1 wherein said method includes infusing 175 mg/m2 of taxol.
3. A method according to claim 1 or claim 2 wherein said method includes infusing said taxol over a duration not exceeding 3 hours.
The present proceedings were commenced on 17 February 1995. The relief claimed in the application is:
1. A declaration that Australian Petty Patent No 641,894 is and was at all material times valid, subsisting and of full force and effect.
2. A declaration that Australian Petty Patent No 651,307 is and was at all material times valid, subsisting and of full force and effect.
3. Injunctions (including interim, interlocutory and permanent injunctions) restraining the Respondent, whether by itself, its directors, officers, servants or agents or otherwise howsoever, during the term of Australian Petty Patent No 641,894 and any extension thereof from infringing the said Petty Patent and in particular from:
(a) importing, offering for supply, supplying, selling or distributing paclitaxel; or
(b) (i) importing, offering to supply, supplying, selling or distributing paclitaxel for administration to patients;
(ii) importing, offering to supply, supplying selling or distributing paclitaxel together with any Product Information, Patient Information or any other document directing, recommending or advising the administration of paclitaxel to a patient;
(iii) authorising any person to administer paclitaxel to a patient; or
(iv) counselling, procuring or inducing any person to administer paclitaxel to a patient,
in accordance with the method of administration claimed in any claim of the said Petty Patent without the licence or authority of the Applicant.
4. Injunctions (including interim, interlocutory and permanent injunctions) restraining the Respondent, whether by itself, its directors, officers, servants or agents or otherwise howsoever, during the term of Australian Petty Patent No 651,307 and any extension thereof from infringing the said Petty Patent and in particular from:
(a) importing, offering for supply, supplying, selling or distributing paclitaxel; or
(b) (i) importing, offering to supply, supplying selling or distributing paclitaxel for administration to patients;
(ii) importing, offering to supply, supplying, selling or distributing paclitaxel together with any Product Information, Patient Information or any other document directing, recommending or advising the administration of paclitaxel to a patient;
(iii) authorising any person to administer paclitaxel to a patient; or
(iv) counselling, procuring or inducing any person to administer paclitaxel to a patient,
in accordance with the method of administration claimed in any claim of the said Petty Patent without the licence or authority of the Applicant.
5. Injunctions (including interim, interlocutory and permanent injunctions) restraining the Respondent, whether by itself, its directors, officers, servants or agents or otherwise howsoever, from making the representations contained in paragraph 21 of the Statement of Claim herein.
6. Delivery up on oath to the Applicant or its nominated agent or for destruction under the supervision of the Applicant or is nominated agent of all articles, goods, substances, packaging, labels or documentation in the possession, custody, power or control of the Respondent the sale, supply or use of which by the Respondent or its servants or agents would be an infringement of the foregoing injunctions or any of them.
7. Damages or at the Applicant's option, an account of profits in respect of all infringements of the said Petty Patents or either of them and payment of the sum or sums found due.
8. Damages pursuant to s 82 of the Trade Practices Act 1974 (Cath).
9. All necessary accounts and enquiries including, so far as may be necessary, enquiries as to damages.
10. Interest on any sum found due on such account or enquiry and payment thereof by the Respondent to the Applicant.
11. Costs.
12. Such further or other orders, directions or relief as may be necessary or as this Honourable Court may deem fit.
The particulars of infringement of the first petty patent filed in this proceeding assert:
1. Subsequent to the publication of the specification of the said petty patent (which took place on 30 September 1993) and prior to 6 January 1995 the Respondent imported into Australia in bulk an oncology product known as "Paclitaxel" and manufactured or formulated therapeutic dosage forms of Paclitaxel for the purposes of undertaking and did undertake, or authorised or produced or induced, the conduct of clinical trials with the said product with a view to securing regulatory approval to supply and market and sell in Australia a Paclitaxel product to be used for the treatment of patients suffering from metastatic ovarian cancer or metastatic breast cancer. The said clinical trials were conducted wholly or in part by administering the Respondent's Paclitaxel product to patients suffering from cancer an intravenous infusion at a dose of 175mg/m2 of Paclitaxel over three hours. The results of such clinical trials were supplied by the Respondent to the Commonwealth Department of Health, Housing, Local Government and Community Services ("the Department") in support of applications for registration of its Paclitaxel products so as to thereby obtain the required approval to market such products in Australia.
2. On 6 January 1995 the Respondent was granted registration and approval by the Department to offer for sale and sell in Australia Paclitaxel products under the name "Anzatax" for the treatment of patients suffering from metastatic ovarian cancer or metastatic breast cancer in conjunction with and under and in accordance with Product Information and Patient Information approved by the Therapeutic Goods Administration of the Department. The approval to market that product in Australia was granted to the Respondent subject to conditions, including the conditions specified in a letter or letters dated 6 January 1995 from Mr D. Hillcoat of the Department of the Respondent. The limited approval granted to the Respondent can only offer for sale and sell Anxieties in Australia for the purpose of administering the said product to a patient suffering from metastatic ovarian cancer and metastatic breast cancer by way of an intravenous infusion at a dose of 175mg/m2 of Paclitaxel over three hours.
3. On or about 23 January 1995 the Respondent caused a letter to be sent to Dr H.P. Gurney in which the Respondent advised that it had launched a new Australian manufactured product known as "Anzatax" Paclitaxel. A copy of the said letter and its enclosures is in the possession of the Applicant's Solicitors and may be inspected during ordinary office hours upon reasonable notice. Enclosed with the said letter was a copy of the approved two page Product Information sheet entitled "Anzatax (Paclitaxel) Injection Concentrate". The said Product Information sheet includes the recommended dosage schedule for administration of Anzatax, namely that Paclitaxel be administered to patients as a single agent at a dose of 175 mg/m2 to be administered as an intravenous infusion over three hours. The letter also included a promotional brochure for the Respondent's Anzatax Paclitaxel.
4. On or about 6 February 1995 the Respondent caused
a letter to be sent to Professor M.H.N. Tattersall in which the Respondent
advised that it had launched a new Australian manufactured product known as
"Anzatax" and enclosing a copy of the said Product Information sheet
and the said promotional brochure. A
copy of the said letter and its enclosures is in the possession
of the Applicant's Solicitors and may be inspected during ordinary office hours
upon reasonable notice.
5. By the letters referred to in paragraphs 2 and 3 hereof and other like letters and other means at present unknown to the Applicant, the Respondent has infringed and/or threatened to infringe and authorized infringement and induced and procured infringement of Claim 1 of the said Petty Patent.
6. On a date presently unknown to the Applicant, the Respondent made a tender to Queensland Purchasing and Supply of the Administrative Services Department of the State of Queensland in response to Invitation for Offers No B225 to supply its product Anzatax Paclitaxel for use in Queensland hospitals in a manner that would infringe Claim 1 of the said Petty Patent.
7. The Applicant is unable before discovery and inspection herein to give particulars of all of the acts of infringement of the said petty patent by the Respondent or the precise number and dates thereof but will claim at the trial of this action to recover damages or an account of profits and other relief in respect of all such infringements.
The particulars of infringement filed in respect of the second petty patent are in the same form except as to the date of publication of the specification (which in the case of the second petty patent was 17 March 1994).
By motion filed on 17 February 1995 the applicant has sought the following orders:
1. That the time for service of the Application and Statement of Claim herein and this Notice of Motion be abridged.
2. Interim and/or interlocutory injunctions in the terms set out in paragraphs 3 and 4 of the application herein.
3. Such further or other orders, directions or relief as may be necessary or as the Court thinks fit.
The applicant's motion was first heard on 20 February 1995 when certain directions were given but no orders were made by way of interim relief. The matter came on again on 23 February 1995 upon the return of a subpoena served by the applicant on the respondent, and again no orders were made by way of interim relief. The motion for interlocutory relief was argued in full on 24 February and 6 March 1995. At the conclusion of proceedings on 6 March 1995 the applicant had still to reply to the respondent's case and was given leave to file and serve a written reply but otherwise the matter was adjourned for judgment on a date to be fixed. The applicant has since filed and served a written reply which was received on 14 March 1995 and the respondent filed a short further submission on 16 March 1995.
The case put for the applicant was argued by counsel for a total period in excess of 6 hours. In addition, the applicant's written reply runs to 28 pages of typescript. The presentation of the respondent's case was necessarily confined by the availability of court time and the commitments of counsel to less than 2 hours. The Court was however greatly assisted by a written outline of the respondent's case. Despite the volume of learning and judicial precedent to which the Court has been referred, it is my view that the matter at present in issue can be resolved by the application of the established principles applicable to the granting of interlocutory injunctive relief.
The present proceeding is not the only litigation
between the parties concerning the patents in suit. In proceeding VG 267 of 1994 commenced on 17
August 1994 (the revocation proceeding) the present respondent seeks revocation
of both patents. That proceeding first
came before the Court on 19 September 1994 when orders were made by consent
relating to
the filing of pleadings and other matters preparatory to the trial of the
action. It is expected that when the
matter is next before the Court for directions on 21 August 1995 the parties
will be ready to seek to have it entered in the list of cases for hearing. The grounds upon which the respondent in
this proceeding seeks revocation of the petty patents in the revocation
proceeding include the assertions that the inventions claimed in each of the
claims of the petty patents were obvious and did not involve an inventive step
having regard to the common general knowledge at the priority date, that the
inventions were not novel and that the claims of the petty patents do not
define the inventions.
Without intending to trivialise a case which took so many hours to present, it is my understanding that the applicant's case is that the respondent by its conduct threatens to infringe the two petty patents, that there is a serious question to be tried as to the validity of the patents and that the balance of convenience favours the granting of injunctive relief restraining the respondent from engaging in the threatened infringing conduct pending trial of the proceeding.
The applicant does not seek to rely upon the granting
of the patents as creating any presumption in favour of their validity but
rather has presented affidavit evidence directed to establishing that the
patents are valid, or at least that there is a serious case to support the
claim to validity.
The respondent has presented affidavit evidence in reply. There are some issues of fact which cannot
be resolved upon the evidence as presented.
Some of the evidence relied upon was based merely upon the information
and belief of the deponents. None of
the deponents on either side was cross-examined. It is not possible, or desirable even if it
were possible on this motion, to resolve factual conflicts or to consider
matters going to credit. The Court is
not in a position to make positive findings of fact. That must await the trial of the
proceeding. Except to the extent that
the evidence is so implausible as to have no probative value at all (which is
not the case with any of the evidence presently before the Court) the Court
must accept the assertions of fact at their face value.
The applicant's case raises complex questions of fact
and law which are identical to those which necessarily must be resolved in the
revocation proceeding. In an
appropriate case, where the facts are undisputed and the law beyond doubt, it
may be appropriate on an interlocutory motion for a decision to be given which
would effectively foreclose the matters in issue in another proceeding between
the same parties. But that case is not
this case. In the present case there is
no common foundation of fact to proceed upon.
The application of the relevant legal principles concerning the validity
of the patents will ultimately depend upon what facts are found. Accordingly, I am satisfied that there are
serious questions to be tried as between the applicant and the
respondent touching upon the validity of the patents. In those circumstances, if it be the fact
that the respondent threatens to engage in conduct that would infringe the
patents in the event of them being held to be valid, it is appropriate that
injunctive relief be contemplated, subject of course to the balance of
convenience favouring the granting of such relief.
The next question to be addressed is whether (assuming the patents to be valid) the threatened conduct of the respondent would be infringing conduct.
It is the applicant's case that the generic product paclitaxel (an anti-cancer agent) was first discovered by chemists Wall and Wani of the Research Triangle Institute in 1963 and that research and development which led to the marketing by the applicant in the United States of America and Australia of the paclitaxel product known as Taxol was conducted jointly by the applicant and the National Cancer Institute in the United States. The respondent markets a product under the trade name Anzatax which is biochemically equivalent to the product marketed by the applicant under the name Taxol.
The applicant further says that since on or about 23
January 1995 the respondent has offered for sale and supply to divers doctors
and hospitals in Australia quantities of Anzatax together with instructions for
use of the product furnished by the respondent and that it has so offered the
product for sale
and supply together with an inducement to use the product. It is said that the use of Anzatax in
accordance with the instructions furnished by the respondent would infringe
claim 1 of the first petty patent and each and all of claims 1 to 3 of the
second petty patent, there being no reasonable use for Anzatax other than a
purpose which infringes those claims.
The applicant also says that at the time the respondent offered Anzatax
for sale and supply it had reason to believe that it would be put to use in
accordance with the instructions furnished by it and that thereby the
respondent has procured or induced and/or threatens to procure or induce divers
doctors in Australia to infringe the first and second petty patents.
The applicant has also pleaded that the respondent has engaged in conduct which contravenes s 52 of the Trade Practices Act 1974 (Cth) but as the interlocutory relief sought goes only to the claimed infringement of the two petty patents it is unnecessary to consider that aspect of the case at this time.
The respondent disputes that it has induced or
procured the use of Anzatax in any particular manner and in particular in a
manner according to the instructions for use of the product furnished by
it. The respondent's argument is that
in every case the method of administration of Anzatax is a matter for the
prescribing doctor who is in no way bound by the manufacturer's
instructions. Whilst that may be
strictly correct, there is some evidence that in practice in the vast
majority of cases the instructions are followed. This is an issue of fact upon which there is
clearly a division of opinion. There is
in my view a serious question to try as to whether or not the conduct alleged
against the respondent should in the circumstances of the case be regarded as
inducing or procuring the use of Anzatax in the manner recommended in the
instructions for the use of Anzatax and thus in a manner which would infringe
the petty patents if they be found to be valid.
It is common cause that the applicant has expended a substantial amount of money in research and development of Taxol and in defining the most appropriate method of administering it; and that as a consequence the applicant is unable to market its product as cheaply as the respondent is able to supply its generic equivalent Anzatax. It is not difficult to accept the applicant's reasoning that without the protection afforded by the petty patents its product Taxol cannot compete in the market place with the respondent's identical product Anzatax. And this is said to be particularly so in circumstances such as the present in which the respondent's product has become available at an early stage in the life of the petty patents and before Taxol has become established in the market.
In considering the balance of convenience there are four scenarios to consider, namely:
i) An injunction is granted to restrain the respondent from marketing Anzatax until trial and the petty patents are held to be valid.
ii) An injunction is granted and the petty patents are revoked.
iii)No injunction is granted and the petty patents are held to be valid.
iv) No injunction is granted and the petty patents are held to be invalid.
In the first and fourth cases neither party would be
disadvantaged. In the second case the
respondent would seek to be compensated for any loss it may suffer as a result
of being unable to compete with the applicant during the currency of the
injunction whereas in the third case the applicant would seek to be compensated
for its loss resulting from the respondent's infringing conduct. In each case the assessment of the loss
would be a complex matter but no more complex than many other cases which
courts have traditionally dealt with.
There is no single factor, or combination of factors, which would tend
to suggest that the task of assessing one party's loss would be any more
difficult or more speculative than the other's. It has not been demonstrated that the
applicant would suffer irreparable harm if no injunction is issued nor that the
respondent would suffer such harm if an injunction is
issued. Both parties are reputable
corporations of considerable standing and substance and would be able to
satisfy any damages award that may later be made in favour of the other.
The scales of convenience are evenly balanced. The status quo should be preserved. The status quo is a situation in which the parties are in direct commercial competition in the marketing of comparable products. Neither has any firmly established position in the market place. The applicant is the proprietor of 2 petty patents which if valid would in effect assure it a monopoly in the market for a period of several years but the validity of those patents has been put in issue and it is agreed that the mere granting of the patents is no guarantee of their validity.
There is nothing about the case which tips the balance in favour of granting injunctive relief. If infringement is later proved the applicant will have its remedy in damages. In my opinion that will be an adequate remedy. The relief sought in the applicant's motion filed on 17 February 1995 is refused. The motion will be dismissed.
I certify that this and the preceding 12 pages are a true copy of the Reasons for Judgment of the Honourable Justice Olney
Associate:
Dated:
Heard: 24 February 1995 and 6 March 1995
Place: Melbourne
Judgment: 23 March 1995.
Appearances:
Mr J. Lyons QC and Mr B. Caine (Instructed by Minter Ellison) appeared for the applicant.
Mr R. Macaw QC and Mr B.J. Hess (instructed by Freehill Hollingdale and Page) appeared for the respondent.
