On April 20, 2016, the Federal Court of Appeal issued its decision in Mylan Pharmaceuticals ULC v Eli Lilly Canada Inc, 2016 FCA 119, a case relating to tadalafil (Eli Lilly’s CIALIS). The Court dismissed the appeal, thereby upholding the Federal Court’s Order of prohibition regarding Canadian Patent No. 2,226,784 (“784 patent”).

In its reasons, the Court of Appeal clarified the test for obviousness-type double-patenting and addressed the relevant date for the double-patenting analysis. The Court also made some important remarks on use of prior art, and on the distinction between prior art and common general knowledge.

Background and decision under appeal

The 784 patent claimed the use of tadalafil and 3-methyl tadalafil for the treatment of erectile dysfunction (ED). In a proceeding commenced by Eli Lilly under the Patented Medicines (Notice of Compliance) Regulations(PMNOC Regulations), Mylan alleged that the relevant claims in the patent were invalidbecause of double-patenting and inutility on the basis of lack of sound prediction.

Eli Lilly also had an earlier patent, Canadian Patent No. 2,181,377 (“377 patent”), which claimed tadalafil as a novel compound, as well as use of tadalafil for treatment of certain disorders, but not ED. The specification of the 377 patent described tadalafil as a PDE V inhibitor, although this was not claimed.

Between the priority date of the 377 patent and the priority date of the 784 patent, Pfizer’s PCT patent application (WO 1994/028902, “902 application”) for sildenafil (Pfizer’s VIAGRA) was published. The 902 application taught, inter alia, that PDE inhibitors could treat ED.

At first instance (2015 FC 17) the applications judge, de Montigny J, allowed Eli Lilly’s application, holding that Mylan’s allegations of invalidity on both double-patenting and inutility were not justified. Mylan appealed.

Federal Court of Appeal decision

Rennie J.A., writing for the Federal Court of Appeal, dismissed Mylan’s appeal. Although the Court found that the applications judge erred in some aspects of the legal framework on both issues, the Court ultimately held that Eli Lilly’s 784 patent was neither invalid for double-patenting nor lacking utility. In its analysis, the Court clarified and re-stated some important points of patent law.

Difference between prior art and common general knowledge

The Court in its preliminary remarks summarized the jurisprudence distinguishing between prior art and common general knowledge. The Court held that prior art is the collection of learning in the field which “comprises any publically available teaching, however obscure or not generally accepted.” Prior art has specific purposes, such as to found an allegation of anticipation or obviousness.

In contrast, the common general knowledge is “knowledge generally known by persons skilled in the relevant art … at the relevant time”, and unlike prior art, “a piece of information only migrates into the common general knowledge if a skilled person would become aware of it and accept it as ‘a good basis for further action’” (citing General Tire & Rubber Co v Firestone Tyre & Rubber Co, [1971] FSR 417 (CA). Further, the Court noted that “[a]ny inquiry in patent law that is performed from the perspective of a skilled person will import the common general knowledge.”

Difference between obviousness-type double-patenting and obviousness

The Court also made some important distinctions between obviousness-type double-patenting and “classical” obviousness:

Invalidity on the basis of obviousness-type double-patenting is not the same as invalidity on the basis of obviousness. Obviousness is directed at the question of whether an “invention” (in the legal sense) exists at all. Obviousness-type double-patenting has a different policy justification; the prevention of evergreening an existing patent through what would otherwise be a valid patent but is, in effect, an extension of the patent that has already been granted […].

Based on those considerations, the Court noted two important differences between the two tests:

  1. For obviousness, any piece of prior art, including a collection of works, can be cited. For obviousness-type double-patenting, only the earlier patent can be cited, and any other prior art is only relevant insofar as it contributes to the common general knowledge.
  2. In the obviousness analysis, s. 28.3(a) of the Patent Act prevents any disclosures made by the patentee within one year of the filing date to be cited against it. However, it does not apply to double-patenting, such that an earlier patent published within the one year grace period may be cited against the later patent for these purposes.

Legal framework for obviousness-type double-patenting

Following those preliminary observations, the Court set out the correct legal test for obviousness-type double-patenting. Mylan argued that the test for obviousness should apply, with the earlier patent taking the place of the prior art. Conversely, Eli Lilly argued that the inquiry should be whether the second invention constitutes an “improper extension” of the original patent, in other words whether what was claimed in the second patent could or should have been claimed in the first patent.

The Court resolved these arguments by holding that there was “no substantive distinction between the two approaches”, as they are “reformulations of the same inquiry”. In both cases, the question is “whether there is an inventive step from the first patent to the second”.

Nonetheless, there are some important considerations specific to the double-patenting analysis. The Court, relying on Merck v Pharmascience, 2010 FC 510, emphasized that in the obviousness analysis for double-patenting, the claims of the first patent and the second patent are to be compared, to determine whether the claims of the second patent exhibit inventiveness over the first patent.

As ordinary rules of claim construction apply in the comparison, if the claims of the first patent are unambiguous, it is improper to refer to the specification to vary the scope of the claims. Further, the Court distinguished between construing the inventive concept from claims construction. Whereas recourse to the specification is acceptable in the former, it is not in the latter where the claims are unambiguous.

Applying the legal framework, the Court found that the applications judge erred by referring to the specification of the earlier 377 patent to read PDE V inhibition into the claims. However, the Court held that the error did not affect the conclusion.

Relevant date for obviousness-type double-patenting

The Court also considered the relevant date for obviousness-type double-patenting. Despite commenting that this was an “unsettled” point of law, the Court declined to definitively decide the issue.

Of the three possible dates – priority date of the first patent; priority date of the second patent; and publication date of the second patent – the Court held only that the last was not appropriate. This is because using any date after the claim date of the second patent would circumvent s. 28.3(a) of the Patent Act and allow a challenger to raise prior art after the claim date for the purposes of double-patenting but not for the purposes of obviousness.

As to the other two dates, the Court found that it was not necessary to decide the issue, because both dates result in a finding that there was no double-patenting in this case. In particular, the Court relied on the factual finding that although Pfizer’s 902 patent application was published between the two dates, its teachings about the use of PDE V inhibitors to treat ED were “counterintuitive” and did not form part of the common general knowledge. Thus the second claims were inventive over the first claims on either date.

Utility and sound prediction

On the issue of utility, the Court reiterated that utility need not be demonstrated and can instead be soundly predicted as of the filing date. The Court found that the application judge erred by his failure to consider the utility of 3-methyl tadalafil in claim 18 based on his interpretation that only one compound in a Markush group required utility. Instead, all compounds in a claimed class must have utility. Nonetheless, the Court found that there was a factual basis and sound line of reasoning to support a sound prediction.

Conclusion and future developments

The Federal Court of Appeal decision clarifies the state of the law on obviousness-type double-patenting. In particular, the well-known Sanofi obviousness test applies in this context, with the important caveat that the “prior art” to be considered for double-patenting is limited to the claims of the earlier patent, and that the earlier patent may be cited for double-patenting even if it was published within one year before the filing date of the second patent.

However, the relevant date for obviousness-type double-patenting remains unsettled. The Federal Court of Appeal has a second chance to decide the issue. In Eli Lilly Canada Inc v Apotex Inc, 2015 FC 875, Gleason J. of the Federal Court granted Eli Lilly’s prohibition order against Apotex in respect of the same drug (tadalafil) and patent (784 patent). In the Apotex case, Gleason J. discussed the relevant date at length, including suggesting that the appropriate date may depend on the way in which a patent is alleged to be void for obviousness-type double-patenting. The appeal of the Apotex case was heard on May 5, 2016 (Court File No. A-330-15) and the decision is under reserve.

Mylan can only appeal this decision if leave is sought and granted by the Supreme Court of Canada.