In its much anticipated judgment in Dr Reddy's Laboratories (UK) Limited v Eli Lilly and Company Limited  EWCA Civ 1362 at the end of last year, the Court of Appeal (Lord Neuberger MR, Jacob and Richards LJJ) rejected the previous long-standing test for the validity of selection patents and has harmonised the UK with the approach taken by the European Patent Office.
Patentees are now no longer restricted by the old rules relating to selection patents. The Court of Appeal has adopted the approach of the European Patent Office such that a patent for a compound previously disclosed in a class of compounds will be valid if it (i) is not individually described in the prior art (novelty); and (ii) contains a real technical advance in the art (obviousness).
Interestingly, the court also made some comments concerning the level of detail and "proof of concept" in patents. In this case Lilly included both experimental details and early clinical trial details leading Jacob LJ to comment that the information was much greater than that generally provided in a patent for a new pharmaceutical compound. Such disclosure appeared to assist Lord Neuberger MR in his determination as to the validity of the patent and its technical contribution. Of course, in reality there is a balancing act to be achieved between including full experimental results and the race to be first to file.
Dr Reddy's attacked Lilly's patent covering its anti-psychotic agent for treatment of schizophrenia, olanzapine, on the basis that it lacked both novelty and inventive step. The patent acknowledged a prior British patent specification that disclosed a class of anti-psychotic compounds set out by a Markush formula. The Markush formula included at least 1019 different compounds, 86,000 preferred compounds and 100 named compounds. However, no indication was given that any of those 100 compounds had been made, let alone tested.
Lilly's olanzapine was one of the 1019 compounds and one of the 86,000 preferred compounds. As Lord Neuberger MR stated in his judgment, the issue of principle on appeal was the proper approach to be adopted when considering the validity of a patent which claims a relatively specific application for one chemical compound, when that compound is included in a large class of compounds which an earlier patent revealed could have application, which includes the specific application claimed in the patent. In the UK, such patents are known as "selection patents".
The position in the UK
The law relating to selection patents is, for patent law at least, relatively old. The leading case is IG Farbenindustrie AG's Patent (1930) 47 RPC 289, where Maugham J set the test that for a selection patent to be valid (i) it must be based on some substantial advantage to be secured by the use of the selected members, (ii) the whole of the selected members must possess the advantage in question, and (iii) the selection must be in respect of a quality of a special character which can fairly be said to be peculiar to the selected group. Therefore, to avoid a finding of anticipation, a patent for a compound had to disclose something special about the compound.
However, it is important to note that IG Farbenindustrie was decided under the old common law and was carried over by the judges into the new codified patent law in 1932. The rule was last considered as part of the pre-1977 law by the House of Lords in DuPont's Patent where Lords Wilberforce and Simon approved and expanded on Maugham J's rules for selection patents.
The court considered that the old UK case law relating to selection patents was wrong, largely on the basis that it was wholly inconsistent with settled European Patent Office Board of Appeal case law. Dr Reddy argued that the fact that olanzapine was a member of the 1019 compounds previously disclosed meant that it formed part of the state of the art as it had been made available to the public by means of a written description (i.e. it fell within Art 54 of the European Patent Convention). Jacob LJ rejected this argument as nonsensical as its effect was that disclosure of a large class is a disclosure of each and every member of it. Instead, in relation to novelty, Jacob LJ looked to the approach of the European patent Office and considered the Technical Board of Appeal judgment in Hoechst Enantiomers T0296/87 which held that an individualised description of the later compound is required to destroy novelty. Applying this concept, the judge thought that a disclosure of a compound via a Markush formula with 1019 possibilities, of which even 86,000 compounds were preferred, was not an individualised description. In Jacob LJ's words, "This case is miles from that."
In relation to inventive step, the Court of Appeal further rejected the old UK law, stating that it was most unlikely that the courts of any of the other 33 members of the European Patent Union would pay any attention to the English pre-1977 case law, even if was of the highest court – Jacob LJ consigned those cases to legal history. Jacob LJ went further, commenting that the previous law was, in reality, difficult to comply with unless the patentee carried out an enormous range of experiments to show that the class or compound had a substantial advantage over the prior art class. The judge went on to consider the approach of the European Patent Office, namely that if there is no more than an arbitrary selection then there is simply no technical contribution provided by the patentee. In Jacob LJ's own words, "Has the patentee made a novel non-obvious technical advance and provided sufficient justification for it to be credible? A 'selection' (by which I mean the later claimed compound or sub-class) which makes a real technical advance in the art is patentable."
In the end the court held that Lilly's patent for olanzapine did show a technical advance, and that it was not merely an arbitrary selection as the patent was the solution to a specific problem, and the prior art disclosure was vague and lacking evidential support. The patent was therefore upheld. As stated by both Lord Neuberger MR and Jacob LJ, they were glad that the Court of Appeal reached the same decision as the German Supreme Court did in relation to the same patent and recognised the desirability of consistency of approach among member states of the European Patent Convention.
Jacob LJ made two final comments. First, in his opinion the previous rules for selection patents were too strict – the technical advance made by Lilly with olanzapine would not have been patentable and the medicine may never have been brought to market. Secondly, having been presented with a large number of foreign decisions regarding the patentability of olanzapine, Jacob LJ considered that these authorities were not at all helpful, in particular those that did not review the relevant jurisprudence of the European Patent Office.