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Petitioner: SHIRE BIOCHEM INC. and others; VS Respondent: ENGLISH PHARMACEUTICAL INDUSTRIES
Court Name: Lahore High Court Judge(s): Umar Ata Bandial Title: SHIRE BIOCHEM INC. and others; vs ENGLISH PHARMACEUTICAL INDUSTRIES Case No.: F.A.O. No,147 of 2006 Date of Judgment:2006-05-18 Reported As: 2006 CLD 1038 Result: Order accordingly
Judgment ORDER ' UMAR ATA BANDIAL, J.---These are two connected appeals filed against a common order dated 27-4-2006 passed by the learned Additional District Judge dismissing the appellants' applications for interim injunction against the respondents in these appeals for restraining them from manufacturing, selling and supplying the drug having generic name lamivudine (for convenience referred to as "lami") on account of infringing the appellants registered Patent No,134736. The respondent in F.A.O. No,147 of 2006 is the manufacturer in Pakistan of lami and the respondent in the connected F.A.O. 148 of 2006 is the seller and distributor of the said drug in the market. The principal ground upon which the impugned order dated 27-4-2006 has declined interim relief to the appellants is that an Patent No,132128 registered by the appellants in respect of the process producing lami expired on 7-2-2006 and, therefore, the appellants do not have a prima facie claim for infringement. 2. Learned counsel for the appellants has strenuously assailed the view taken by the learned trial Court by explaining the developments in the patented processes that have been overlooked. The invention of the basic process to produce lami was patented in 1989, however, that product did not exist in a form that was therapeutically human consumable. Through subsequent research and development further processes were invented whereby lami was refined to the point of being therapeutically human consumable with lesser impurities and higher efficacy. The specific patent in respect of the process that produces such lami drug is Patent No,134736 registered in Pakistan on 20-4-1995 with a U.K. Priority date of 23-4-1994. Going by the period of protection under the Patents and Designs Act, 1911 (repealed in 2000) this drug is protected for 16 years until 2010. It is said that the respondent admits in para.5(1) of its written statement that the appellant's drug
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ZEFFIX containing lami is manufactured under Patent No,134736. The contents of paragraph 5.1 of the respondent's written statement read: "5.1. The defendant's LAMUDINE drug is manufactured from the raw material (bulk Lamivudine) being imported from and manufactured by Messrs Northeast General Pharmaceutical Factory, Shenyoung Fine Chemical Co. Ltd. (hereinafter referred to as NEPGF), a Chinese company of 37 Zhonggong Bei Street, Tiexi District Sheyang, Peoples Republic of China Post Code: 110026 (hereinafter referred to as Defendant's process). The process through which the Messrs NEPGF is manufacturing Lamivudine is a process different from all those processes contained and claimed by the Plaintiffs in their alleged Patents Nos. 132128, 132680, 133215, 134736 and 135072. The detailed process for synthesis of Lamivudine of Messrs NEPGF along with the comparison of the processes contained in plaintiffs Patent No,134736 through which the Plaintiffs are manufacturing their ZEFFIX drug containing Lamivudine, is annexed as Annexure D to the written statement." 3. Apart from the foregoing factual stand another plea taken by the respondent before the learned trial Court is that the invention covered by the appellants' Patent No,-134736 is actually a patent of addition falling under section 39 of the Patent Ordinance, 2000 ("Ordinance"). The provisions of section 39(1) are reproduced below:-- "39. Patents of addition.---(1) Where an application is made for a patent in respect of any improvement in or modification of an invention, hereinafter referred to as the "main invention", and the applicant also applies or has applied for a patent for that invention or is the patentee in respect thereof, the Controller may, if the applicant so requests, grant the patent for the improvement or modification as a patent of addition." 4. It is the respondent's plea that the Patent No,134736 relied by the appellants is merely an improvement or modification of the original Patent No,132128 which expired on 7-2-2006. Under section 40 of the Ordinance a patent of addition also has a term equal to the main invention and, therefore, it is the respondent's case that Patent No,134736 has also expired as of 7-2-2006. 5. The learned counsel for the appellants has analyzed the foregoing pleas taken by the respondent. On the one hand if the respondent in F.A.O. 147 of 2006 is manufacturing lami under a chinese process that is allegedly distinct from the appellants patented process then no case for infringement can be made out. On the other hand, when the respondent simultaneously takes the plea that the appellants do not have a valid patent to protect their process, then it implies that the respondent is applying the appellants process.,. _.As is also the statutory presumption under section 61(1)(b) of the Ordinance. Therefore, the plea of the respondent under section 39 of the Ordinance is alleged to be deflective and a mere ruse to avoid its duty to bring proof that its chinese process is different from the appellants process. 6. With reference to documents filed by the respondents, learned counsel for the appellants. Submits that the consignment of the allegedly infringing lanfi raw material was manufactured in July, 2005 from which the drug of the respondent was manufactured in Pakistan in October, 2005. This is not denied by the respondent. Accordingly, it is established on record that the infringing lami drug was manufactured by the respondent during the admitted period of validity of Patent No,132128 which is alleged by respondents to have expired on 7-2-2006, although the learned counsel for the appellant argues that it is valid for 20 years under section 31 of the Ordinance until 7-2-2010. 7. Turning to the respondent's other plea under section 39 of the Ordinance learned counsel for the appellants explained that Patent No,134736 protects a new invention and is not merely an improvement or modification of the main invention recorded in the original but allegedly expired Patent No,132128 so as to be a patent of addition. Going by the certificates placed on record by the appellants, the first being the cover sheet of the certified copy of the specific granted Patent No,134736 and the other being the "letters patent" document of the said patent, neither describes
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the said patent to be registered as a patent of addition. It is explained that in the pharmaceutical trade the process of isolation or purification of different agents in a chemical compound for obtaining a product with higher quality or a product with higher therapeutic effect qualify as inventive steps. This is contemplated by section 9 of the Ordinance and to exemplify the point, learned counsel for the appellants has relied on Beecham Group Limited v. Bristol Laboratories Limited and another (1967 RPC 406). In that judgment the English Court of Appeal considered the development of ampicillin as a derivative of penicillin nucleus called 6-aminopencillanic acid ("6- apa"). The process that isolated 6-apa which led to the development of ampicillin as a drug was upheld to be a process that qualified for a I Lew patent. An informative passage at page 414 of the said report dealing with the derivative development of the pharmaceutical reads:- "There are two more patents equally important. They cover a derivative which has special curative properties called ampicillin. The research workers found that by inducing a chemical reaction which is scientifically known as "acylating" the 6-apa, they could produce the drug called ampicillin. It is the subject of two patents. One of these. No,873,049, in claim 1 claims a group of penicillin derivatives in accordance with a specified formula; and in claim 5 a particular member of their group, alpha-amino-benzylpencillin, which for short is called ampicillin. The other Patent, No,902,703, claims the discovery of the epimers, which are particularly valuable in producing ampicillin of the most effective kind. Those two patents together cover a process for producing ampicillin, and the product itself. The validity of these patents also has been challenged here today. But these two patents also have been accepted so long and so wisely that we should accept for present purposes that they are valid. Professor said of these:-- "The specific derivative of 6-aminopenicillanic acid, alpha-amino-benzyl-pencillin could not have been predicted from the prior art. Still less could it have been predicted that that derivative would have particularly useful properties. Indeed, the discovery of this most valuable antibiotic resulted entirely and undisputedly from the work of Doyle, Nayler and Smith in the invention which forms the subject-matter of British Patent No,873,049." ' On all these points Sir Robert Robinson, who is of the highest eminence himself, confirms the views of Professor Chain. He describes ampicillin as a "highly important novel preparation." In my opinion we should assume prima facie the validity of these four patents." 8. In the present case learned counsel for the appellants submits that the inventive steps leading to the therapeutically human consumable form of lami through the appellants Patent No,134736 in the shape of their drug having the name Zeffix, is the process of "stereo-selectivity" which excludes from the lami Lewis acids, that are highly reactive and unstable agents with toxic side effects. As a result, it is contended that after satisfactory tests and trials, in 1995 the F.D.A. In the United States approved Zeffix for consumption and marketing worldwide by the appellants. On the other hand, they maintain that there is no such approval in respect of the respondent's lami product which is allegedly manufactured by the respondent under a hitherto unproven and unapproved chinese process. 9. The learned counsel for the appellants has supported the foregoing submissions with another factual disclosure. The first Patent No,132128 is owned by Shire Biochem, Inc., the first appellant in F.A.O. 147 and F.A.O. 148 of 2006. Shire Biochem however, never marketed its patented product until after the developments introduced and the safety standards incorporated therein by the appellant No,2, namely, Glaxo Group Limited which are the owners of the relevant and currently valid Patent No,134736 that was registered four years later. It is explained that during these four years the appellant No,2 researched and developed the processes that met the higher safety and therapeutic standards for human consumption of lami as contained in their drug, Zeffix. In support of his case for interim injunction against the manufacture and supply of their product by the respondent, the learned counsel for the appellants has relied on the following authorities Smith
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Kline French Laboratories Ltd. And another v. Ferozsons Laboratories Ltd. And another (1992 M LD 2226), Glaxo Group Limited and 2 others v. Evron (Private) Limited and another (1992 CLC 2382), Mere & Co. Ing. And others v. Hilton Pharma (Pvt.) Ltd. (2003 CLD 407) and Khawaja Tahir Jamal v. Messrs A.R. Rehman Glass (2005 CLD 1768). 10. On behalf of the respondent, the learned counsel has submitted that the controversy before this Court is only in relation to interim relief which is dealt by the provisions of the Patent Ordinance, 2000 to be granted as provisional measures under section 61(1)(a) of the Ordinance. Therefore, he submits that the ordinary criteria of interim relief need not be followed strictly and the court ought to modulate its relief in the light of the three main/principal reliefs that are available under the Ordinance. These are the reliefs of damages, injunction and accounts. He submits that whilst considering the matter of provisional measures the Court should keep in mind the rule enshrined in the first proviso to section 61(1)(a) of the Ordinance whereby. According to him, a product made by the defendant which is identical to a patented product, is presumed to be produced by the patent process then the proviso reads: "provided that the product obtained by the patented process is new if it has not been put into the ma :et for more than one year before the date of the initiation on of the judicial action by the patentee." 11. In the present case he submits that admittedly the patented process of the appellants under Patent No,134736 is not new and its product has been in the market since 1996, for longer than one year. As a result, he submits that the statutory presumption does not apply in the present case so that the matter is one for recording of evidence. 12. The second point raised by the learned counsel is that the appellants have made admissions in two crucial documents to the effect that lami is the active ingredient in their product Zeffix. It is recalled that the patent for that active ingredient, lami bearing Patent No,132128, has expired. Therefore, the pharmaceutical compound lami which possesses the relevant medicinal qualities is available in the public domain and no action for the infringement thereof is maintainable. The question whether Patent No,134736 constitutes an indeinondent patent being an inventive step rather than an improver cut or modification of the original expired patent is also in the light of the appellants admissions a matter of evidence that cannot be presumed prematurely. 13. In the foregoing context, the learned counsel has referred to the petition for extension of the expired. Patent No,132128 filed by the appellants which is available on the record of the learned trial Court. This petition contains the following statements:-- "1.3. The petitioner researches, develops, manufactures and markets leading innovative prescription drugs used to treat a number of diseases and conditions. Amongst the completely novel invented products of substantial therapeutic importance, which has been discovered by the petitioner and subsequently developed and marketed by GlaxoSmithKline Group of Companies, is a Compound (including its processes of manufacture, its enantiomers, derivatives, and formulations/compositions) now known by the International Non-Proprietary name of Lamivudine, (subject-matter of Patent No,132128) which is the active ingredient contained in the pharmaceutical products sold by the GlaxoSmithKline ' Group of Companies, further details of which will be provided in the paragraphs to follow." (Emphasis added). 14. The second admission is said to be contained in the product history of the appellants drug, Zeffix given on their web site:-- "Product History. Zeffix was discovered as BCH 189 on March 1, 1989 by Dr. Bornard Belleau and his research team in BioChem Pharma Inc. Of Quebec Canada. An agreement to licence the drug to Glaxo (now Glaxo
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Wellcome), for worldwide development and marketing was signed in 1990." 15. Given the above admissions, the learned counsel for the respondent submits whether the patented process for the appellants product constitutes an inventive step is a matter to be decided on evidence. He has referred to section 60(2) of the Ordinance whereunder the respondent as a right to seek the revocation of a patent by way of defence in a suit for its infringement. In this connection he has referred to paragraph 3.7(I) and (II) at pp.3-10 of the written statement wherein the respondent has sought revocation of inter alia, the appellants currently valid Patent No,134376. 16. As a pivotal point, learned counsel for the respondent submits that its product lamivudine (Lamudive) is being supplied to the Government of Pakistan under a contract dated 10-4-2006 for 3,65,000 tablets for the Prime Minister's Program for Prevention and Control of Hepatitis. This contract was awarded in competitive bidding wherein the appellants also participated but failed to match the lowest price offered by the respondent. Also placed on record by the respondent is the contract with and the purchase order issued by the Government of Pakistan both dated 10-4- 2006 for supply of the medicine in one go. The contract specifies that the package carton of the medicine supplied by the respondent shall bear the following notice:-- "NOT FOR SALE" FOR USE ONLY BY THE PRIME MINISTER'S PROGRAM FOR PREVENTION AND CONTROL OF HEPATITIS" ' Program Manager, (Prime Minister's Program for Preventive and Control of Hepatitis) Government of Pakistan 12-5-2006 has written to the respondent for the urgent delivery of the contracted medicine in the following words:-- "3. It may please be noted that timely supply of Tablets Lamivudine is critical for this program to initiate hepatitis treatment interventions per plan. Moreover, in view of the high disease prevalence, there is it license public pressure to initiate treatment facilities the earliest. Messrs Biocare is accordingly advised to pursue and arrange immediate supply of the said medicine within stipulated time to avoid any it true inconvenience." ' Learned counsel submits that the present situation of high incidence of the disease having epidemic is catered by section 58 of the Ordinance as follows:-- "58. Exploitation by a Government agency or thirdperson.---(1) Subject to subsection (2), where:-- (i) the public interest, in particular, national security, nutrition, health or the development of other vital sectors of the national economy so requires; or ' the Federal Government may, even without the consent of the owner of the patent, decide that a Government agency or a third person designated by the Federal Government may exploit a patented invention: (2) The Federal Government shall, before taking any decision under subsection (1), give the owner of the patent and any interested person an opportunity of being heard if he wishes to be heard." 18. He adds that all laws are framed in the public interest and must be so interpreted by Courts of law. Accordingly, in the foregoing circumstances of a national program constituted at the highest level by the Government of Pakistan for control of hepatitis the provisions of section 58(1) of the Ordinance are to be invoked in the public interest as otherwise the present supply of lami lying ready with the respondent shall not reach the intended patients who are in dire need thereof. 19. Finally, it is contended that the impugned order I any event provides requisite protection to the appellants by ordering accounts to be strictly maintained by the respondent in respect of the supplies of lamidine made by it. In support of his foregoing submission learned counsel he has relied on Acto Lab (Pvt.) Ltd. v. Pfizer Ltd. And others (2002 CLD 120), Biogen Inc. v. Medeva Place (1997 RPC 1) and Bristol Myers Squibb Co. v. Baker Norton Pharmaceuticals Inc. (2001 RPC 1).
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20. The learned counsel for the parties have made weighty and analytical submissions. In order to assess their impact upon the outcome of the present controversy it is advantages to consider the facts in the perspective of provisional measures. The Patent No,132128 registering the process to produce lami expired on 7-2-2006 at the end of a 16-year term contemplated by the repealed Patent and Designs Act, 1911. Rule 24(5) of the Patent Rules, 2003 framed pursuant to the Ordinance reiterates a term of 16 years protection for patents registered under the repealed Act. On account of the expiry of the said patent the case of the appellants for infringement of patent has necessarily shifted to sole reliance upon their Patent No,134736 with a U.K. Priority date of 23-4-1994. The appellants referred to the Beecham Group judgment of the English Court of Appeal to exemplify that the process to make lami therapeutically human consumable is an inventive step. However, that judgment concerns the development of a derivative compound with special curative properties which is prima facie different from the present claim involving refinement of an existing pharmaceutical for making it humanly consumable. 21. Indeed whether Patent No,134736 constitutes a novel, inventive step within the meaning of sections 8 and 9 of the Ordinance qualifying for patentability under section 7 ibid is truly the central point of the controversy between the parties. This is highlighted by the respondent challenge to the appellants Patent No,134376 as a patent of addition and the corresponding attack in para.3.7(I) & (II) of its written statement for revocation of the appellants registered Patent No,134736. The key factor lending some credibility to the challenge raised by the respondent are the statements made by the appellant acknowledging lami as registered under the expired Patent No,132128 to be the "active ingredient contain in the pharmaceutical products sold by the appellants". The foregoing statements dent the appellants case for infringement requiring them to bring prima facie material to the trial Court that their registered Patent No,134736 records an invention and not a mere improvement or modification of the original patent. 22. Indeed in the foregoing factual matrix, the Beecham Group judgment of the English Court of Appeal is not apt. In fact there may be an instructive instance in Bristol Myers Squibb Co. v. Baker Norton Pharmaceuticals Inc. (2001 RPC 1). Here the inventive step was stated to a different dosage of Taxol, a cancer treatment drug, whereby its human consumability and, therefore, effectiveness was radically improved. By drawing a distinction between discovery and invention the English Court of Appeal upheld the High Court's conclusion in an infringement action that the patent was invalid and ordered its revocation. On this point the Court of Appeal gave its reasoning as:-- "98. The part of the invention said to be unknown at the time of the Winograd lecture was the reduction in neutropenia. But, for the reasons indicated by the judge, identification of that quality did not require inventive skill over and above the skills already taught by Winograd, since the skilled man armed with the latter information would or.. At least co .11:1 press on with the trials, and in so doing inevitably find out the facts about neurtropenia. That would be a discovery, but not an inventive step. The whole of the inventive nature of the process had already been disclosed by Winograd." 23. Notwithstanding the foregoing discussion that indicates grounds for ordering evidence to be recorded on the question of patentability of the appellants process in Patent No,134376 which also connects with challenge of revocation by the respondent; there is important statutory criterion of evidence that must be applied at the present stage of provisional measures. This is tl le statutory presumption of infringement contained in section fill 1)(b) of the Ordinance:-- "61. Reliefs in suits for infringement.---(1) In any suit for infringement the Court shall have the power; (b) to order, if the subject-matter of a patent is a process for obtaining a product, the defendant to prove that the process to obtain an identical product is different from the patented process and that the identical product in question shall, in the absence of proof to the contrary, be deemed to have been obtained by the patented process provided that the product obtained by patented
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process is new if it has not been put into the market for more than one year before the date of the initiation of the judicial action by the patentee: ' Provided that this provision shall apply subject to prior proof by the plaintiff that the allegedly infringing product is identical to the product directly produced by the patented process: ' Provided further that in the abduction of proof to the contrary, the legitimate interests of defendants in protecting their manufacturing and business secrets shall be taken into account." Notwithstanding the admissions made by the appellants, it is an established fact that they have a process registered under Patent No,134376 and that the respondent admits its product to be identical to the appellant's Zeffix. On these facts the foregoing statutory presumption is attracted to the facts of the case. The question, however, is with what strictness would the presumption apply. The effort by the learned counsel for the respondent to avoid the presumption on the basis of the first proviso to section 61(1)(b) of the Ordinance is unhelpful because that would tend to dislodge the basic right of enjoyment of a patent that had a life of 16 years under the repealed Patents and Designs Act, 1911 and now validity for 2Q years under the Ordinance. Confining the enforceability of a patent to merely one year conflicts with the substantive provisions of the Ordinance. Clearly, therefore, the proviso needs careful consideration and interpretation.…
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