England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE CHPCI 1999/0534/3

(MR JUSTICE PUMFREY )

Royal Courts of Justice

Strand

London WC2

Friday, 23 July 1999

B e f o r e:

LORD JUSTICE AULD

LORD JUSTICE ALDOUS

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MONSANTO COMPANY

GD SEARLE & COMPANY

PFIZER INC

CLAIMANTS/APPELLANTS

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MERCK & COMPANY INC

MERCK SHARP & DOHME LIMITED

DEFENDANTS/RESPONDENTS

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(Computer Aided Transcript of the Palantype Notes of

Smith Bernal Reporting Limited, 180 Fleet Street,

London EC4A 2HD

Tel: 0171 421 4040

Official Shorthand Writers to the Court)

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MR D KITCHIN QC with MR R MEADE (Instructed by Messrs Bristows, London WC2A 3AA) appeared on behalf of the Appellant

MR D YOUNG QC with MR T HINCHCLIFFE (Instructed by Messrs Lovell White Durrant, London EC1A 2DY) appeared on behalf of the Respondent

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J U D G M E N T

(As approved by the Court )

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©Crown Copyright

Friday, 23 July 1999

J U D G M E N T

LORD JUSTICE ALDOUS: Monsanto Company, GD Searle & Company and Pfizer Inc are the owners of European Patent (UK) Number 0679157 in respect of an invention entitled "Novel 3,4-Diaryl Thiophenes and Anaglogs Thereof Having Use as Antiinflammatory Agents" ("the patentees"). By writ issued in March 1998 the patentees started proceedings against Merck & Co Inc and Merck Sharp & Dohme Limited alleging infringement of the patent. For the purposes of the appeal there is no need to differentiate between them and I will refer to them as "Merck". Merck have denied infringement and alleged that the patent is invalid. Those issues will be decided when the action and counterclaim come on for trial in October of this year.

This appeal is against that part of the order of Pumfrey J of 5th May 1999 which struck out paragraphs 6 and 7 of the patentees' statement of case on infringement. That order was made, as the judge concluded, that the patentees' case that claim 20 and certain dependent claims had been infringed was unarguable. To understand the issue decided by the judge, it is necessary to understand, in outline, the substance of the dispute on infringement that will come before the judge in October.

The invention is concerned with particular pharmaceuticals within a class known as non-steroidal anti-inflammatory drugs ("NSAIDs"). NSAIDs are important drugs used in the suppression of pain and the reduction of inflammation. Like many other drugs, they can also cause side-effects including gastric irritation. The patent is said to relate to such drugs "having anti-inflammatory and/or analgesic activity without erosion of the stomach". The compounds of the invention are complex as appears from the terms of claim 1 which claims a class in this way:

"1. A compound of Formula 1

wherein Y is selected from S, O, and NR ¹;

wherein R ¹ is selected from hydrido and C ₁-C₆ alkyl;

wherein X is one or more substituents selected from

(a) hydrido halo, cyano, nitro, hydroxy, acyl, lower alkyl substituted at a substitutable position with a substituent selected from halo, hydroxyl, amino, acylamino, lower alkylamino, lower alkyl(acyl)amino, acyl, aryl optionally substituted with hydroxyl, a heterocyclic group, hydroxyimine and lower alkoxyimine, lower alkonyl optionally substituted at a substitutable position with cyano, amino optionally substituted at a substitutable position with a radical selected from acyl and lower alkylsulfonyl, sulfo, sulfamoyl optionally substituted with a substituent selected from the group consisting of lower alkyl, halo(lower)alkyl, aryl, hydroxyl, lower alkylamino(lower)alkyl, a heterocyclic group and (esterified carboxy)lower alkyl, N-containing heterocyclicsulfonyl, a heterocyclic group optionally substituted at a substitutable position with a substituent selected from the group consisting of hydroxyl, oxo, amino and lower alkylamino, provided that when Y is O or NR ¹ then X cannot be hydroxyalkyl.

(b) S(O) _nR⁵, wherein R ⁵ is C ₁-C₆ alkyl optionally substituted at a substitutable position with fluoro, and n is O, 1 or 2.

(c) C(R ⁶)(OR⁸)(R⁷) wherein R ⁶ and R ⁷ independently are selected from CF ³, CF ₂H, CFC1 ₂, CF ₂C1, CC1FH, CC1 ₂F, CF ₃CF₂ and C ₁-C₂alkyl, and wherein R ⁸ is selected from hydrido, C ₁-C₄ alkyl, (C ₁-C₃ alkyl)C(O) and CO ₂R⁹ wherein R ⁹ is C ₁-C₄ alkyl,

(d) C(O)ZR ⁴, wherein Z is O, N, or S, and R4 is selected from hydrido, C ₁-C₆ alkyl and aryl, and when Z is N then R ⁴ is independently taken twice and

(e) C(R ⁹) (NHR ¹¹) (R ¹⁰), wherein R ⁹ and R ¹⁰ are independently selected from CF ₃, CF ₂H, CFC1 ₂, CF ₂C1, CC1FH and CC1 ₂H, and R ¹¹ is selected from hydrido and C ₁-C₃ alkyl and

wherein R ² and R ³ are independently selected from

aryl or heteroaryl, wherein the aryl or heteroaryl radical is optionally substituted at a substitutable position with a radical selected from halo, lower alkyl, lower alkoxy, lower alkylthio, lower alkylsulfinyl, lower alkylsulfonyl, nitro, amide, amino, lower alkylamino, sulfamyl and lower alkylsulfonylamino, provided that at least one of R ² and R ³ is substituted with methylsulfonyl or sulfamyl; or a pharmaceutically-acceptable salt thereof."

The specification describes in detail how such compounds can be produced and their use. It goes on to describe how they can be administered; for example they can be administered orally, in solid or liquid form, or injected.

Merck are intending to launch a NSAID under the name "Vioxx". It has been tested in this country and it contains as its active ingredient a product called MK-966 which has the chemical name 3 phenyl-4-(-4-methylsulphonylphenyl)-2-(5H) furanone. It is referred to in the pleadings as the "Keto form". The patentees allege that the Keto form is a compound falling within the ambit of claim 1. That is disputed and that dispute will be one of the main issues at the trial.

Another part of the patentees case is that the Keto form is a tautomer of the Enol form which has the chemical name 3-phenyl-4-(-4-methylsalphonylphenyl)-2-hydroxyfuran. The patentees believe that the Enol form falls within the ambit of claim 1. They contend that after the Keto form (MK-966) is administered to a patient, a significant amount of the Enol form is produced. Further, upon administration, a third compound, "the Enolate" is formed which is also alleged to fall within claim 1. Thus it is alleged that claim 1 has and will be infringed because of the presence of the Keto form and the Enol and Enolate forms which appear upon use.

The patentees have an alternative case based upon infringement taking place during production of the Keto form which is being carried out abroad. The patentees allege that during the final stage of production the Enolate form and the Enol form is present in significant quantities. According to the patentees the Enolate anion is the common anion of both the Keto and Enol forms of MK-966. In the final stage of production of MK-966 the reaction is carried out in the presence of the organic amine base, diisopropylamine, with conditions such that the MK-966 exists in solution in the Enolate form. To obtain the crystalline form used for tabletting, the Enolate form is neutralised with 2NHCL and dried. At that stage it is in the Keto form. The patentees contend that the presence of the Enol and Enolate forms during production infringes claim 20 which is in this form:

"20. Use of a compound of Claim 1 for preparing a medicament for treating inflammation or an inflammation-associated disorder."

The patentees contend that claim 20 covers an invention which is a process and that pursuant to section 60(1)(c) of the Patents Act 1977 importation of the Keto form, a product obtained directly by means of that process, constitutes infringement of that claim. That section provides:

"60(1) Subject to the provisions of this section, a person infringes a patent for an invention if, but only if, while the patent is in force, he does any of the following things in the United Kingdom in relation to the invention without the consent of the proprietor of the patent, that is to say:-

...

(c) where the invention is a process, he disposes of, offers to dispose of, uses or imports any product obtained directly by means of that process or keeps any such product whether for disposal or otherwise."

The patentees accept that the Enol and Enolate forms are not present in the active ingredient as imported which is in the Keto form. If the Keto form falls within claim 1, then the alternative case of the patentees is irrelevant. Thus for the purposes of deciding the question raised in the appeal, whether the alternative case is arguable, it is convenient to assume, first that the Keto form does not fall within claim 1, second the Enol and Enolate forms are not present after administration but fall within claim 1, and third that they are present during the production process carried out abroad as I have described. As it is necessary to assume that the Enol and Enolate forms fall within claim 1, it seems appropriate also to assume that they have the active properties which the specification suggests that claim 1 compounds have.

Merck contended before the judge and the judge held that, upon the assumed facts, claim 20 when properly construed was not infringed. It followed that the patentees' alternative case was unsustainable and should be struck out. The judge said at page 15D:

"For the purposes of infringement, however, it seems to me that I am required to construe this claim according to ordinary principles. It seems to me that the words 'use of a compound of claim 1 for preparing a medicament' are concerned with the step of preparation of the medicament as opposed to the preparation of the active ingredient. Ex hypothesi, the active ingredient is outside the claim and is not present in the result of the preparation.

It seems to me that the crucial difference is actually between, on the one hand the use of a compound of claim 1 to prepare an active ingredient for use in preparing a medicament, and use of an active ingredient to prepare the medicament. The latter is, in my judgment, what is claimed. In substance, therefore, I accept Mr Young's submission that the use which is talked about in claim 20 is a use which is subsequent to the manufacture of the compound of claim 1 itself.

It seems to me that in its context in the specification, in truth there is no suggestion that anything else could have been contemplated. My attention was not drawn, and I have not found any passage in the specification which suggests use of the materials of claim 1 other than for the purposes of the production of other materials equally within claim 1. Indeed, any such indication would necessarily be speculative.

It seems to me also that the construction which I have placed upon the words, on the hypothesis which I have indicated, confers a fair protection upon the patentee, combined with a reasonable degree of certainty for third parties.

The presence of the compound in question during the course of manufacture of the active ingredient is, accordingly, in my judgment, not use of the compound in question for preparing the medicament.

I have come to the conclusion that this is a clear case of construction which I should decide against the patentees. This makes it unnecessary to consider the question of discovery or of a statement of case on infringement further.

Accordingly I construe the claim in such a way that the defendants do not infringe claim 20 on the hypothesis as to fact advanced in paragraphs 6 and 7 of the statement of case on infringement. The allegation of infringement of claim 20 and those paragraphs of the statement of case on infringement will be struck out."

The patentees submit that the judge wrongly construed claim 20 and, in any case, should not have embarked upon the course of action that he did. Although construction of the claim was for the court, it had to be carried out according to section 125 of the Act and that required application of the Protocol on Interpretation. That task could, in this case, only be accomplished after the Court had adopted the mantle of a skilled man in the art which could not properly be done at this stage of the action. The correct approach was that advocated by the Court of Appeal in Strix v. Otter Controls Ltd [1991] FSR 354 at 357:

"It is, however, also to be borne in mind that much time and money will be wasted where there is an application to strike out which is ultimately unsuccessful. Furthermore it has never been permissible on a striking out application where the issues in the action include any issues of fact to conduct a mini-trial on the affidavits in order to avoid the burden of a proper trial."

Dillon LJ then set out the well known statement of Danckwerts LJ in Wenlock v. Moloney [1965] 1 WLR 1238. He then continued:

"The course which the judge adopted in the present case, in his critical examination of the evidence to see whether the plaintiff has adduced sufficient evidence, directed to the right points and supported by adequately cogent reasoning, to counter the points taken by the defendant is, in my judgment, essentially the course which Danckwerts LJ there condemned.

The difficulty that arises where it is sought to strike out a patent action on the ground that there is no arguable case of infringement arises because the construction of a patent, though a question of law for the court, is not a mere question of the judge reading the patent with the assistance of the legal arguments of counsel; it is a much more sophisticated exercise for two reasons. First the language of the patent is deemed to have been addressed by the inventor not to a panel of equity draftsmen but to 'the man skilled in the art,' and consequently the court has to consider what the language of the patent would mean not to lawyers, but to the man skilled in the art with his knowledge of the art. Secondly it has long been established that a person does not avoid infringing a patent if he departs from the strict requirements of the claims by what the man skilled in the art would recognise as an 'obviously immaterial variant'..."

Dillon LJ went on at page 359 to cite this passage from his judgment in Improver Corporation v. Remington Consumer Products Ltd [1989] RPC 69 at 78:

"Against that background it seems to me that the question of whether on a purposive construction this particular mechanical equivalent does or does not infringe the patent is a question of considerable difficulty. It is wholly inappropriate for a striking-out application under Order 18, rule 19. That rule applies to striking out on the ground that a pleading or indorsement of a writ discloses no reasonable cause of action, or is scandalous, frivolous or vexatious or an abuse of the process of the court (I omit certain points which are not relevant). But it is well established that it is only 'in plain and obvious cases that recourse should be had to the summary process under the rule' and it is only to be used where the claim is 'obviously unsustainable' and not to be 'exercised by a minute and protracted examination of the documents and facts of the case.' It seems to me that an application to strike out what was a wholly inappropriate method of trying to obtain summary disposal of a patent action. This is a case in which infringement proceedings have been begun in many jurisdictions. They have not yet got very far, because the defendants' device is only recently on the market. It may ultimately be established that the defendants are right in saying that their device does not, on a proper construction of the patent, infringe claim 1, but an action is not an abuse of the process of the court just because at the end of the day it may be held that the plaintiffs' case is not well founded in law."

If claim 20 is to be construed literally, the question for consideration can to be posed as: did Merck use the Enol or Enolate forms for preparing a medicament for treating inflammation? The specification makes it clear that the inflammatory agents of the invention can be administered in a variety of ways, for example by injection, as capsules, tablets and in liquid dosage forms. They can also be administered alone or with carriers or in combination with other active pharmaceuticals such as imunoanmodulators, antiviral agents or anti-infective agents. Thus I would construe the word "medicament" as covering a medicinal product which could take a variety of forms and which could include active and inactive chemicals not falling within claim 1.

The judge construed the claim as being limited to a stage of preparation after the compound of claim 1 had been prepared. The patentees submitted that the words of the claim did not contain such a limitation. The words "use of a compound ... for preparing a medicament" covered any use during the preparation.

Mr Young QC who appeared for Merck supported the conclusion reached by the judge. He submitted that it was clear, both from the wording of claim 20 and the teaching of the specification, that a compound as claimed in claim 1 had to be the active ingredient in claim 20 which had the anti-inflammatory activity. The compounds of claim 1 were not just precursors of the active ingredients which did not fall within claim 1. To read claim 20 as suggested by the patentees would result in it going outside the teaching of the specification. He submitted that the claim should be interpreted as a Swiss-type claim so that its purpose was to cover the compound of claim 1 when made for a particular purpose and having a particular effect.

I prefer the submissions of the patentees. The words of claim 20, when read literally, contain no restriction as to when or how the compound in claim 1 is used other than used for the preparation of the medicament which has anti-inflammatory properties. The word "preparation" is used in many places in the specification as describing production or manufacture. For example, on page 19 line 11 it is stated: "The following examples contain detailed descriptions of the methods of preparation of compounds of Formula I-II." I see no reason to confine the step or steps of preparation referred to in claim 20 to when the Keto form (MK-966), which is the form used in the tablets, has been prepared. Literally construed, claim 20 would appear to cover use of a claim 1 compound during the preparation of the medicament, meaning all the stages of preparation up to the final form.

As section 125 of the Act makes clear, literal interpretation of the claim is not correct. The true width of an invention is to be ascertained from the claim construing its ambit as defining a position between the extremes of literal interpretation and that of using the claim as a guideline. Thus it is arguable that claim 20 should be given a wider ambit than the literal meaning of the words. It follows that even if the judge's construction was literally correct, that might not be appropriate when construed purposively as required by section 125.

As I have said, Mr Young submitted that there was no suggestion in the specification of use of a claim 1 compound during the manufacturing process other than when it also formed the active ingredient. He may be right that there is no explicit disclosure to that effect, but it does not mean that the skilled man who read the specification would conclude that a claim 1 compound would not be useful for production of another compound which did not strictly fall within claim 1; or to put it the other way round, a skilled man might understand from the specification that provided that a claim 1 compound (such as the Enolate form) was used during manufacture, it did not strictly matter that the product actually administered did not fall within claim 1. Whether he would or would not cannot be decided at this stage of the proceedings. Thus the submission, if it has force in supporting the suggestion that the literal meaning should not be adopted, cannot be used to support the decision to strike out part of the patentees' case.

The judge also referred to the Guidelines prepared by the European Patent Office and to the fact that the claim appeared to be what is known as a Swiss-type claim. It may be, as the judge suggested, that a reason behind the way that claim 20 is worded is the prohibition upon patentees claiming methods of treatment, but that does not throw light upon whether the words used cover the whole process of preparation or only the step after a claim 1 form as found in the medicament has been produced.

I do not believe that the judge was right to conclude that the alternative case put forward by the patentees is unarguable upon the assumed facts. Despite the view as to the meaning of claim 20 which I have expressed above, it would not be right, at this stage of the action, to come to any concluded view as to the ambit of claim 20. The patent must be construed as a whole and the claims interpreted according to the Protocol on Interpretation. The subject of this specification is complicated. To come to a concluded view, the mantle of a man skilled in the art must be adopted. That will require the aid of expert evidence. The words of Dillon LJ in Strix v. Otter Controls which I have quoted, are in my view just as apt today after the Civil Court Practice Rules came into force as they were when the Rules of the Supreme Court were applicable.

Finally I come to a submission of Mr Young which was advanced before the judge, but was not mentioned by him. Mr Young submitted that claim 20 was not a claim where the invention was a process and therefore section 60(1)(c) of the Act had no application. He submitted that it was clear from reading the specification that the invention was the compounds which had particular effects when administered to humans. There was no claim to the method of making such compounds and claim 20 was a claim which sought to monopolise the compounds of the invention, even if they were not novel per se.

That submission is wrong in principle and contrary to authority. It is wrong to muddle up what is an inventive concept and what is meant by the word "invention" in section 60. Section 60 states that a person infringes a patent for an invention if he does certain acts in relation to the invention without the consent of the patentee. Subsection (1)(c) is concerned with the case where the invention is a process. Section 125 lays down so far as section 60 is concerned, that the invention "shall ... be taken to be that specified in a claim". Thus the nature of the relevant invention is discerned from claim 20. That claim is for the preparation of a medicament. That is an invention for a process.

That a claim such as claim 20 is a process claim was confirmed by Whitford J and Falconer J sitting in banc in John Wyeth & Brother Ltd's Application [1985] RPC 545. In that case claims in similar form to claim 20 were considered. The court said at page 563:

"Mr Laddie, for the Comptroller, submitted, and we agree, that a claim in the Swiss form, such as those in the Wyeth and Schering claims now under consideration, although in the form 'The use of substance A in the manufacturer of a medicament to treat disease B', is, in reality, a claim to the method of manufacture of such a medicament by using substance A in its manufacture."

The court at page 566 cited this passage from the Enlarged Board of Appeals of the European Patent Office in Eisai (1985) OJ 64:

"For these reasons, the Enlarged Board considers that it is legitimate in principle to allow claims directed to the use of a substance or composition for the manufacture of a medicament for a specified new and inventive therapeutic application, even in a case in which the process of manufacture as such does not differ from known processes using the same active ingredient."

Although the Enlarged Board were considering patentability of claims in a form similar to claim 20, it is clear that they interpreted such claims as process claims.

I conclude that the judge was wrong to strike out paragraphs 6 and 7 of the patentees' statement of case. I would allow the appeal.

LORD JUSTICE AULD: I agree with my Lord that the appeal should be allowed and for the reasons he gives.

With diffidence, and without the means of donning the mantle of a man skilled in the art, I venture to add a few words on the construction of claim 20.

The claim in the context of this issue is for the use of Enol and/or Enolate for preparing a medicament containing Keto as its active ingredient, for treating inflammation or an inflammation-associated disorder. In my view, on the wording of the claim and the teaching of the specification, it is at least arguable that its meaning is wider than that given to it by the judge.

The use of Enol and/or Enolate in the preparation of the medicament is capable, it seems to me, of including all use of those ingredients in the chemical and/or manufacturing process with a view to, and culminating in, the production of the medicament. That includes stages in the preparation of its active ingredient.

To limit the meaning of the claim to the final stage of the preparation of the medicament from the, or a final active ingredient resulting from the whole process, would effectively substitute for the formula, use of Enol and/or Enolate for preparing the medicament, the formula, reproduction of Enol and/or Enolate in the medicament.

On the face of it, and considering the words in their context, I can see no basis for limiting the meaning of a preparation of a medicament in claim 20 to a process which culminates in a medicament containing the Enol and/or Enolate as an active ingredient.

As my Lord has said, the court's task is to construe the patent as a whole and having regard to section 125 of the 1977 Act and the Protocol on Interpretation. It must don the mantle of a man skilled in the art. It seems to me impossible at this stage and certainly without evidence on the matter, to say that the plaintiffs' case for the wider construction that I have identified is so plainly and obviously wrong that this part of the claim should be struck out.

Accordingly, the appeal is allowed.

ORDER: Appeal allowed; appellants to have their costs here and below; costs below of £8,597.50, costs on the appeal of £24,000; order for repayment of the £9,000 costs already paid. ( This order does not form part of the approved judgment )