Federal Court of Appeal Re-Affirms Requirement that Factual Basis for Sound Prediction be Disclosed in the Patent – Eli Lilly & Co. v. Teva Canada Ltd., 2011 FCA 220, July 5, 2011

Published August 4th, 2011

     This is an appeal by Eli Lilly and Co. (Lilly) from a decision of the Federal Court (2010 FC 915).  In that decision, the trial judge granted to Teva Canada Limited (Teva) a declaration that Lilly’s Canadian Patent No. 2,209,735 (`735 Patent) for the use of atomoxetine for the treatment of attention deficit hyperactivity disorder (ADHD), was invalid for lack of utility.  In particular, Barnes J. had held that the results from a clinical study conducted before the filing date of the `735 Patent were not adequate to demonstrate utility based on the promise of the patent.  He also held that the study could not be relied upon as a factual basis to support a sound prediction for the utility because the study had not been disclosed in the `735 Patent.

      Lilly appealed, arguing that the trial judge erred by:  (i) invalidating the `735 Patent for lack of demonstrated utility by misconstruing its promise; (ii) requiring too high a standard of proof of utility; and (iii) deciding that Lilly could not rely on sound prediction of utility because it had not disclosed the factual basis for the sound prediction in the patent.

      The Court of Appeal upheld the trial judge’s decision invalidating the `735 Patent for lack of utility.  In particular, with respect to construction, Evans J.A., writing for the Court, held that the trial judge properly construed the promise of the `735 Patent to be that atomoxetine was clinically effective treatment for ADHD for some patients.

      With respect to the amount of utility required, the Court held that a low level or scintilla of utility was insufficient and upheld the trial judge’s conclusion that the promise of the `735 Patent had not been demonstrated at the relevant date.  Although in Novopharm Limited v. Pfizer Canada Inc., 2010 FCA 242, it was held that a small clinical study was sufficient to demonstrate utility, the Court cautioned against comparing a factual situation in one patent case with another patent case.

      With respect to sound prediction, following its decision in Eli Lilly Canada Inc. v. Apotex Inc., 2009 FCA 97 requiring disclosure of the factual basis for the sound prediction in the patent itself, the Court upheld the trial judge’s decision that Lilly could not rely on the clinical study because it had not been disclosed in the `735 Patent.

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