AstraZeneca Canada Inc. v. Apotex Inc., 2017 SCC 36

The Supreme Court of Canada (“SCC”) struck down the “promise doctrine” of Canadian patent law in favour of a far lower standard of utility. In doing so, the SCC reversed a Federal Court of Appeal (“FCA”) decision finding AstraZeneca’s Canadian Patent No. 2,139,653 (“the ‘653 patent”) invalid for promising utility which was not demonstrated or soundly predicted at the time of filing. [24]

Under the SCC’s reasoning, the promise doctrine was not good law for two reasons: the doctrine improperly imports the disclosure requirement under s. 27(3) of the Patent Act into the utility requirement under s. 2, [44] and improperly requires that every promised use of the invention be demonstrated or soundly predicted, lest the entire patent be held invalid. [51]

The SCC set out as the correct approach a two-step analysis focusing on the subject-matter of the nature of the invention. First, a court is to identify the subject-matter of the invention as claimed in the patent. Second, the court must ask whether that subject-matter is useful – “is it capable of a practical purpose (i.e. an actual result)?” [54] A single use related to the nature of the subject-matter of the invention having a scintilla of utility is sufficient. [55] The utility must be established by either demonstration or sound prediction as of the filing date. [55]

The Promise Doctrine is not Good Law: Punitive and Conflates the Utility Requirement with the Disclosure Requirement

Proponents of the promise doctrine assert that it helps dissuade patentees from overpromising in their patent applications, [45] and helps to maintain the quality and reliability of patents as a repository of useful teachings of inventions.

The SCC’s analysis, however, focused on the legislative origin of the utility requirement under s. 2 of the Patent Act, its interaction with other sections of the Act, [26] and the current utility analysis incorporating the promise doctrine being out of line with other validity analyses.

The SCC criticized the promise doctrine as improperly importing the disclosure requirement under s. 27(3) of the Act into the utility requirement under s. 2 by requiring that any disclosed use be demonstrated or soundly predicted at the time of filing. [44] This doctrine, the SCC stated, “is an interpretation of the utility requirement that is incongruent with both the words and the scheme of the Patent Act”. [36] The SCC quoted Consolboard to further draw a distinction between the utility requirement in s. 2, which is a “condition precedent to an invention”, and the disclosure requirement under s. 27(4) of the Act, which is independent of the utility requirement. [43]

The SCC further criticized the doctrine as “punitive” in that it may invalidate the entire patent if any one of the promises in the patent is not fulfilled, in contrast to claim-by-claim declarations of invalidity operable in other grounds of invalidity, and which is codified in s. 58 of the Act. [31, 46, 51] The SCC further criticized that the promise doctrine directs courts to read both the claims and the disclosure to identify potential promises, rather than the claims alone, even in an absence of ambiguity in the claims, [31] in supposed contrast to other validity analyses, wherein the focus is on the claims alone, and only considers the disclosure where there is ambiguity in the claims. [31]

SCC’s Correct Approach to Utility

The correct approach to the utility analysis, as set out by the SCC, is to be undertaken in line with its purpose – “to prevent the patenting of fanciful, speculative or inoperable inventions,” [57] and with an understanding that the subject-matter of an invention can be multi-faceted. [49] The SCC thus set out a two-step analysis:

  1. First, courts must identify the subject-matter of the invention as claimed in the patent. [54]
  2. Second, courts must ask whether that subject-matter is useful — “is it capable of a practical purpose (i.e. an actual result)?” [54]

A single use related to the nature of the subject-matter of the invention having a scintilla of utility is sufficient, [55] but a proposed invention cannot be saved by a use unrelated to the subject matter of the invention. For example, “it is not sufficient for a patentee seeking a patent for a machine to assert it is useful as a paperweight.” [53] As remains unchanged, the utility must be established by either demonstration or sound prediction as of the filing date. [55]

AstraZeneca Patent Saved by Single Useful Use

In a strikingly short four paragraphs, the SCC applied its new test for utility to the facts of the case of the ‘653 patent. The SCC identified the subject matter of the ‘653 patent that must be useful for the purposes of s. 2 as optically pure salts of the enantiomers of omeprazole. In the Federal Court (“FC”) decision, the FC had determined that:

. . . the subject matter of the ‘653 patent was optically pure salts of the enantiomers of omeprazole, described as novel compounds, having improved pharmacokinetic and metabolic properties and high stability to racemization in neutral and basic pH, a method to make them, and therapeutic uses. [emphasis in original] [60]

The SCC then summarily noted that the FC had held that it was soundly predicted by the relevant date that the optically pure salts of the enantiomer of omeprazole would be useful as a proton pump inhibitor (“PPI”) to reduce production of gastric acid. Since use as a PPI is appropriately related to the subject-matter of the ‘653 patent, the utility requirement was met. [63]

Commentary

Although some members of the patent bar may rejoice at what is no doubt a pro-patent decision, the reasons provided by the SCC are conspicuously brief given the controversy surrounding the promise doctrine. For example, there is no discussion as to how permitting unfulfilled promises in the specification is workable, especially in light of the sufficiency requirement as set out in the seminal Viagra case (Teva Canada Limited v Pfizer Canada Inc, 2012 SCC 60) In Viagra, the patent on the popular erectile dysfunction drug was invalidated for failure to comply with s. 27(3)(a) of the Act, which requires the patent specification to correctly and fully describe the invention. The patent at issue had set out a multiplicity of claims covering a broad range of (less useful) compounds, but failed to precisely disclose the only compound which was found to induce erections: sildenafil. It would seem that there is a wide gap between the new test for utility set out by the SCC, which requires only one working proposed use to be satisfied, and the sufficiency requirement as exemplified in Viagra.

The decision also appears to leave the door open for lingering promise-like arguments through s. 53 of the Patent Act, which has historically seen most of its use in ownership and inventorship disputes: “this mischief may result in a patent being void under s. 53 of the Act, where overpromising in a specification amounts to an omission or addition that is “willfully made for the purpose of misleading”. [46] As with the former promise doctrine, a patent invalidated under s. 53 is invalidated in its entirety, not on a claim-by-claim basis.

This decision is also timely given the recent NAFTA ruling which came down in favour of Canada and the promise doctrine. Arguments in this case had been made long before the NAFTA ruling was released, and the SCC did not directly address any of the countervailing arguments advanced in the arbitral NAFTA ruling.