Use Claims, Swiss-style Claims and Freedom to Operate

A freedom to operate (FTO) question is often asked about use claims such as Swiss-style claims, allowable in Australia.

A Swiss-style claim in the pharmaceutical field (though analogous structure is relevant to a range of chemical products such as lubricants) has the general form:

Use of X for the manufacture of a medicament for the treatment of Y.

Here, X is typically referred to a “second medical indication” which provides the patentability of such a claim and analysis of whether infringement of such a claim would occur. This issue arose in the recent Federal Court case of Mylan Health Pty Ltd v Sun Pharma ANZ Pty Ltd [2019] FCA 28 (22 January 2019) (“Mylan Health”).  That case presented an opportunity for Australian Courts to consider construction of such claims, as the UK Supreme Court had done in Warner Lambert Company LLC v Generics (UK) Ltd [2018] UKSC 56 (“Warner Lambert”).

The relevant patents concerned fenofibrate products for treating retinopathy which is vision threatening.  One relevant claim, of many, in the relevant patents read:

Use of fenofibrate or a derivative thereof for the manufacture of a medicament for the prevention and/or treatment of retinopathy, in particular diabetic retinopathy.

that is, a Swiss-style claim.

Importation of Manufactured Medicament – Infringement in Australia?

An initial issue was whether a Swiss-style claim can be infringed by importation and supply in Australian territory of a medicament manufactured outside Australian territory.  While this could be an issue for some jurisdictions, not so in Australia where infringement occurs through “exploiting” an Australian patent.  Nicholas J held in Mylan Health that such importation and supply could constitute infringement though this did not determine the case.  The nature of Swiss-style claims required consideration.

The Question of Intention – Subjective or Objective?

Patent infringement, while a tort, is not an intentional tort so infringement may be found whether or not the infringer actually intended to infringe.  The FTO position is complicated for Swiss-style claims which inherently contain an intention: to treat the specified condition, here retinopathy.  Thus, the infringement analysis atypically includes a “mental element”.

The question then is whether the intention is to be measured:

  • subjectively: from the standpoint of the defendant’s intention for use of the fenofibrate to manufacture a medicament for treating retinopathy, i.e. as a question of fact alone; or
  • objectively: from the standpoint of a hypothetical person considering the defendant’s conduct, i.e. whether infringement arising from the conduct was reasonably foreseeable.

In the Warner Lambert case, the UK Supreme Court decided that a manufacturer who makes the relevant medicament do so with the objective intention that it be used to treat the medical condition recited in the claim.  A defendant objectively intends infringing conduct if it was foreseeable to the reasonable person, irrespective of whether the defendant actually considered the question.

In the case, Nicholas J found it unnecessary to decide whether Swiss-style claims are concerned with the objective or the subjective intention of the manufacturer.  However, the objective analysis of Warner Lambert was particularly persuasive: “especially in so far as [it] highlights the difficulties that may be involved in ascertaining the subjective intention of a manufacturer, an intention that may or may not be carried into effect, and about which distributors, pharmacists, medical practitioners and patients often will have little or no knowledge”.

What are the practical consequences?

Given that the objective analysis most likely applies in Australia, it will be important for manufacturers, especially pharmaceutical manufacturers or chemical product manufacturers, to carefully consider modes of product advertisement, promotion and education.  Directly advertising, promoting or educating as to an infringing use, will greatly assist a Court in finding infringement.

However, conduct that is less direct could still be problematic.  The ultimate question is whether the product that results from the claimed use is one that has the effect defined in the relevant claim.  This requires a consideration of all relevant facts and circumstances surrounding the use.  Relevant factors could include, without limitation, the PI for the product, any labelling and the nature, size and other pertinent characteristics of the market into which the product is to be sold.  Alternative uses of the product are also relevant.

As such questions inevitably raise the need for careful legal advice, manufacturers concerned with how Swiss-style claims may affect their freedom to operate are urged to seek advice specific to their situation.