Principles on inventive step and “routine formulation steps” rammed home in Australian patent case

Animal health company Abbey Laboratories (Abbey) has successfully defeated Elanco Australasia’s (Elanco) third bite at trying to get a granted Australian patent for an invention directed at a specific dosage range of an active ingredient for the treatment of lice on sheep. 

Abbey twice opposed the patent application proceeding to grant before IP Australia (including with an amended claim set), and Elanco appealed the decisions of the Delegate to the Federal Court of Australia.

In a decision handed down on 14 June 2024, Burley J has dismissed Elanco’s appeal. The judge found that Abbey had established that proof of concept studies were a matter of routine formulation steps, and that the identification of a specific dosage range of an active for the treatment of lice in this case lacked an inventive step.  

Two oppositions before IP Australia

In the first opposition before IP Australia, Abbey had opposed the patent application proceeding to grant on the basis that the patent lacked novelty in view of a Trade Advice Notice that had been published before the priority date of the patent by the Australian Pesticides and Veterinary Medicines Authority (APVMA), and lack of inventive step (amongst others).  

Trade Advice Notices are prepared by the APVMA when it is considering an application for registration of an agricultural or veterinary chemical.  It provides a summary of the APVMA’s residue and trade assessment.  

The relevant Trade Advice Notice relied on here related to an application by Bayer Australia (the prior applicant for the patent before it was assigned to Elanco) for the registration of a new sheep dip product called “Piranha Dip for Sheep”, containing an approved active constituent thiacloprid (480 g/L).

The first opposition was allowed by the Delegate, based on lack of novelty, and lack of inventive step. Elanco then sought to amend the patent application to try and overcome those findings by limiting its claims to application of thiacloprid by backlining (otherwise referred to as a “pour-on formulation”). 

A second opposition hearing ensued in respect of the amended patent application. Abbey argued that the amendments were not sufficient to overcome the lack of inventive step ground in view of the common general knowledge, and the information in the Trade Advice Notice.  The Delegate again refused the patent application. 

Elanco appealed to the Federal Court of Australia, seeking to challenge findings of the Delegate in both the first and second oppositions. 

Appeal to the Federal Court of Australia

Background

Appeals from decisions of the Australian patent office to the Federal Court involve a hearing de novo. 

To invalidate a claim under Australian law for lack of obviousness, the hypothetical skilled team must be led, as a matter of course to try the particular dosage range, with an expectation that it will obtain a better result or some other useful result (as opposed to knowing that steps will or may well work). 

In this regard, there is a distinction between steps taken as a matter of routine that would invalidate a claim, and steps taken because they would be “worth a try” – but which would not invalidate a claim. 

In terms of expectation, as the Full Court said in Generic Health:

It is difficult to think of a case where an expectation that an experiment might well succeed is not implicit in the characterisation of steps as routine and to be tried as a matter of course. On the other hand, we think a test formulated in terms of worthwhile to try was firmly rejected by the High Court

Decision in this case

The invention described in the patent application was said to be based in part on the surprising discovery that thiacloprid has high potency and suitability for the control of lice, when applied externally to an animal.  Specifically, the invention claimed (as amended) did not concern a formulation, but a dosage range applied by backlining. 

At the time, backlining with small volumes of product being applied to the back of the sheep was the most preferred form of administration for treatment of ectoparasites on animals because it was an easier and more efficient method of administration – it is easier than dipping a sheep. 

Abbey’s position was that the skilled team would, as a matter of routine, have conducted the solubility, proof of concept and dose determination studies leading from the Trade Advice Notice to the claimed invention in the expectation that they might well succeed in finding a dose within the claimed range. 

Burley J agreed with Abbey, finding that:

“In the present case, no inventiveness lies in the perception of the true nature of the problem. Once armed with the Trade Advice Notice the skilled team immediately perceives the desirability of moving to a backlining method using thiacloprid. The question remaining is whether the process of arriving at a formulation within the claimed range was an inventive step.
Although I accept that the process of determining the dosage amounts would be time consuming and expensive, and would possibly take the team a long time to achieve, I am satisfied that their conduct is well within the range of the skills of the skilled team and falls within the range of conduct described in the authorities as “routine steps”.”

“I accept that at the outset the skilled team would not know the dosage amount that would be ultimately selected. But that is precisely why the tests are required. Such tests are, however, in my view in the nature of tests for checking and verifying of the type referred to in Wellcome Foundation” he said.

Abbey was represented by Bird & Bird.