Under Indian patent law, there is a peculiar yardstick of “non-patentable inventions” as listed under section 3 of the Patents Act. Hon’ble Madras High Court, in a recent judgment in Novozymes Vs. The Assistant Controller of Patents & Designs has again explained the scope of sections 3(d) and 3(e) of the Act. The explanation regarding section 3(d) is interesting as the same has been defined for non-pharmaceutical inventions, particularly for biochemical inventions.
Aggrieved by the Controller’s order dated 15 November 2016 concerning patent application no. 5326/CHENP/208, Novozymes had filed an appeal under section 117 of the Act. Said application relates to phytase variants with improved thermostability. The Controller has refused the patent application on two grounds (i) the claimed invention is a known substance which is not patent-eligible under section 3(d) of the Act, and (ii) the composition claims 8 – 11 fall within the scope of section 3(e) of the Act, because the composition is a substance obtained by the mere admixture of ingredients. The Controller has not rejected the claims as not an invention under section 2(1)(j) or that the disclosure is not defined as to work the invention. Thus, the claims of the patent application fulfil the criteria of patentability and enablement requirements as per the Act.
Novozymes’s contentions:
On the Controller’s rejection of claims on the ground of non-patentable invention under section 3(d), the counsels for Novozymes based their contentions on three points:
- Section 3(d) of the Act applies only to pharmaceutical substances. This contention of Novozyme was supported by para 12 of the judgement of the Division bench of Madras High Court in Novartis Ag V. Union of India (Manu/TN/1263/2007), which concluded that the first limb of section 3(d) is referable only to the field of pharmacology. They also placed reliance on paragraphs 81-82, 87-88 and 157 of the judgement of the Hon’ble Supreme Court in Novartis AG V. Union of India (2013) (6 SCC 1).
- The explanation to section 3(d) enumerates several derivatives of chemical substances, and after such enumeration, the generic expression “and other derivatives of known substance” is used. Novozyme contended that based on the principle of ejusdem generis, such generic expression should be limited to derivatives of chemical substances, and it should not be extended to biochemical substances such as phytase.
- Section 3(d) enables the grant of a patent for a new form of a known substance, provided such a unique form results in the enhancement of the known efficacy of that substance. Novozymes argued that in the present matter, the claimed invention enhances the thermostability of phytase. Such enhanced thermostability improves the overall effectiveness of the product. To substantiate this argument, example 8 and table 5 of the specification were referred to in which all the variants show an improvement factor (IF) in excess of one.
Further, for rejecting claims under section 3(e), Novozymes contended that section 3(e) does not apply unless the substance is obtained by a mere admixture of known ingredients. It was also argued that section 3(e) applies only to independent claims and not to dependent claims. As per Novozymes, claims 8 -11 are dependent claims as the composition comprises at least one phytase of claim 1.
Controller’s contentions:
- The Controller submitted that section 3(d) uses the expression “known substance” and not “pharmaceutical substance”. Thus, the provision is not limited only to pharmaceutical products. Since phytase is a biochemical substance, it also falls within the scope of section 3(d).
- Regarding the explanation to section 3(d), the Controller argued that the expression “and other derivatives of known substance” also applies to variants of phytase because phytase and its variants are biochemical substances. Also, it was argued that nothing in the explanation limits the scope to synthesized chemicals only.
- Further, the Controller argued that enhancement of efficacy can be claimed only when it is demonstrated that the enzymatic activity of the phytase is enhanced by the claimed variants. The variant should exhibit greater efficacy in catalyzing digestion by the end user of the substance.
- While justifying the rejection of claims under section 3(e), the Controller argued that the detailed particulars of ingredients other than phytase are not provided. The applicant has to demonstrate that there is a synergy between the ingredients forming the composition and that the composition is more than the sum of its parts.
Court’s finding:
Regarding section 3(d):
The first question answered by the court was whether the expression “known substance” in section 3(d) is confined to pharmaceutical substances, as argued by Novozymes. After careful analysis of relevant paragraphs of the Division bench judgement in the Novartis matter and in the Supreme court judgment, the court held that it does not follow from the two decisions that the provision only applies to pharmaceutical and agro-chemical substances and not to biochemical substances.
The court also held that the explanation to section 3(d) does not apply to the claimed invention. While coming to this conclusion, the court has carefully considered the principle of ejusdem generis. The court discussed that the explanation to section 3(d) incorporates a legal fiction by which all chemical derivatives of a known substance would be considered as the known substance unless such derivatives cross the hurdle or pass through the filter prescribed therein. The court held that the claimed invention did not fall within the scope of explanation as it qualified as a new form of a known substance even if it did not cross the hurdle prescribed in such an explanation.
While discussing the third point, “enhancement of efficacy”, the court held that nothing in the text limits such enhancement to any specific type of efficacy. Also, the Supreme Court in Novartis matter has held that the test of efficacy would be different depending on the product’s function, purpose or utility. The court disagreed with the Controller’s conclusion that the enhancement of the known efficacy should be limited to enhanced hydrolysis of phytate, resulting in improved breakdown of the indigestible form of phosphorous to a digestible form. The court instead held that increased thermostability precludes denaturation and enables production, storage and sale in pellet form; it enhances the known efficacy of the enzyme in aiding digestion.
Further, the court discussed whether even a marginal improvement in efficacy sufficed. The court observed that the provision only requires enhancement of known efficacy with no indication regarding the enhancement margin. The court held that the applicant has to establish a reasonable enhancement of efficacy to the satisfaction of the Controller, and reasonable enhancement may be defined as an enhancement that is material from an improvement of efficacy perspective. Thus, the court concluded that the claimed invention satisfies the requirement of enhancement of the known efficacy of phytase. Therefore, the court held that the Controller’s order with respect to rejection of claims 1-7 under section 3(d) is set aside.
Regarding section 3(e):
The court observed that nothing in the provision limits the application of the provision to a composition formed by the aggregation of known ingredients. The court noticed that the adjective “known” is used as a qualifier in sections 3(d), 3(f) and 3(p); however, the same is absent in section 3(e).
Further, the court also held that section 3(e) does not appear to be limited in its application to independent claims only. The court observed that the provision appears to exclude from patentability any composition claim for a substance that merely exhibits the aggregate properties of its constituents. The court disagrees with Novozyme’s argument that the grant of composition claims would not expand the scope of the patent; however, by this composition claim, the applicant would be in a position to institute infringement proceedings against any person who infringes their patent. The court held that this contention does not appear to be correct regarding claim 9; also, the independent claim protects the patentee’s rights against unauthorized use of the patented substance as an ingredient in a composition. Also, the court held that, in any event, a patent cannot be granted for a composition claim solely for this reason. Thus, the court upheld the Controller’s decision that in the absence of evidence that the composition is more than the sum of its parts, claims 8 – 11 should not be granted.
Therefore, the appeal was partly allowed with respect to claims 1 – 7 and partly refused with respect to claims 8 -11 and the direction was issued that the application shall proceed to grant on the modified terms.
Conclusion:
This judgement has further clarified the scope of section 3(d), specifically with respect to biochemical inventions. Clearly, the provision of section 3(d) also applies to biochemical inventions. However, it has been clarified that the enhancement of efficacy for the inventions should be examined more carefully rather than taking a narrow approach with respect to the activity of the product. This judgment also clarifies that there is no magnitude or numeric value to define the enhancement of efficacy. However, the parameter remains subjective, as the court held that such enhancements should be reasonable to the satisfaction of the Controller. Regarding section 3(e), the court held that the provision is not restricted to “known” ingredients. The applicant has to justify that the composition is more than the sum of its parts to overcome the hurdle of section 3(e).
This judgement, on the one hand, clarifies the scope of section 3(d) for biochemical invention, and on the other hand, it has raised the bar for section 3(e) by stating that the provision is applicable to all composition, even if it contains a new ingredient. The earlier approach taken by the applicants when a composition is claimed for a novel substance may no longer be applicable in view of this judgment.Under Indian patent law, there is a peculiar yardstick of “non-patentable inventions” as listed under section 3 of the Patents Act. Hon’ble Madras High Court, in a recent judgment in Novozymes Vs. The Assistant Controller of Patents & Designs has again explained the scope of sections 3(d) and 3(e) of the Act. The explanation regarding section 3(d) is interesting as the same has been defined for non-pharmaceutical inventions, particularly for biochemical inventions.
Aggrieved by the Controller’s order dated 15 November 2016 concerning patent application no. 5326/CHENP/208, Novozymes had filed an appeal under section 117 of the Act. Said application relates to phytase variants with improved thermostability. The Controller has refused the patent application on two grounds (i) the claimed invention is a known substance which is not patent-eligible under section 3(d) of the Act, and (ii) the composition claims 8 – 11 fall within the scope of section 3(e) of the Act, because the composition is a substance obtained by the mere admixture of ingredients. The Controller has not rejected the claims as not an invention under section 2(1)(j) or that the disclosure is not defined as to work the invention. Thus, the claims of the patent application fulfil the criteria of patentability and enablement requirements as per the Act.
Novozymes’s contentions:
On the Controller’s rejection of claims on the ground of non-patentable invention under section 3(d), the counsels for Novozymes based their contentions on three points:
- Section 3(d) of the Act applies only to pharmaceutical substances. This contention of Novozyme was supported by para 12 of the judgement of the Division bench of Madras High Court in Novartis Ag V. Union of India (Manu/TN/1263/2007), which concluded that the first limb of section 3(d) is referable only to the field of pharmacology. They also placed reliance on paragraphs 81-82, 87-88 and 157 of the judgement of the Hon’ble Supreme Court in Novartis AG V. Union of India (2013) (6 SCC 1).
- The explanation to section 3(d) enumerates several derivatives of chemical substances, and after such enumeration, the generic expression “and other derivatives of known substance” is used. Novozyme contended that based on the principle of ejusdem generis, such generic expression should be limited to derivatives of chemical substances, and it should not be extended to biochemical substances such as phytase.
- Section 3(d) enables the grant of a patent for a new form of a known substance, provided such a unique form results in the enhancement of the known efficacy of that substance. Novozymes argued that in the present matter, the claimed invention enhances the thermostability of phytase. Such enhanced thermostability improves the overall effectiveness of the product. To substantiate this argument, example 8 and table 5 of the specification were referred to in which all the variants show an improvement factor (IF) in excess of one.
Further, for rejecting claims under section 3(e), Novozymes contended that section 3(e) does not apply unless the substance is obtained by a mere admixture of known ingredients. It was also argued that section 3(e) applies only to independent claims and not to dependent claims. As per Novozymes, claims 8 -11 are dependent claims as the composition comprises at least one phytase of claim 1.
Controller’s contentions:
- The Controller submitted that section 3(d) uses the expression “known substance” and not “pharmaceutical substance”. Thus, the provision is not limited only to pharmaceutical products. Since phytase is a biochemical substance, it also falls within the scope of section 3(d).
- Regarding the explanation to section 3(d), the Controller argued that the expression “and other derivatives of known substance” also applies to variants of phytase because phytase and its variants are biochemical substances. Also, it was argued that nothing in the explanation limits the scope to synthesized chemicals only.
- Further, the Controller argued that enhancement of efficacy can be claimed only when it is demonstrated that the enzymatic activity of the phytase is enhanced by the claimed variants. The variant should exhibit greater efficacy in catalyzing digestion by the end user of the substance.
- While justifying the rejection of claims under section 3(e), the Controller argued that the detailed particulars of ingredients other than phytase are not provided. The applicant has to demonstrate that there is a synergy between the ingredients forming the composition and that the composition is more than the sum of its parts.
Court’s finding:
Regarding section 3(d):
The first question answered by the court was whether the expression “known substance” in section 3(d) is confined to pharmaceutical substances, as argued by Novozymes. After careful analysis of relevant paragraphs of the Division bench judgement in the Novartis matter and in the Supreme court judgment, the court held that it does not follow from the two decisions that the provision only applies to pharmaceutical and agro-chemical substances and not to biochemical substances.
The court also held that the explanation to section 3(d) does not apply to the claimed invention. While coming to this conclusion, the court has carefully considered the principle of ejusdem generis. The court discussed that the explanation to section 3(d) incorporates a legal fiction by which all chemical derivatives of a known substance would be considered as the known substance unless such derivatives cross the hurdle or pass through the filter prescribed therein. The court held that the claimed invention did not fall within the scope of explanation as it qualified as a new form of a known substance even if it did not cross the hurdle prescribed in such an explanation.
While discussing the third point, “enhancement of efficacy”, the court held that nothing in the text limits such enhancement to any specific type of efficacy. Also, the Supreme Court in Novartis matter has held that the test of efficacy would be different depending on the product’s function, purpose or utility. The court disagreed with the Controller’s conclusion that the enhancement of the known efficacy should be limited to enhanced hydrolysis of phytate, resulting in improved breakdown of the indigestible form of phosphorous to a digestible form. The court instead held that increased thermostability precludes denaturation and enables production, storage and sale in pellet form; it enhances the known efficacy of the enzyme in aiding digestion.
Further, the court discussed whether even a marginal improvement in efficacy sufficed. The court observed that the provision only requires enhancement of known efficacy with no indication regarding the enhancement margin. The court held that the applicant has to establish a reasonable enhancement of efficacy to the satisfaction of the Controller, and reasonable enhancement may be defined as an enhancement that is material from an improvement of efficacy perspective. Thus, the court concluded that the claimed invention satisfies the requirement of enhancement of the known efficacy of phytase. Therefore, the court held that the Controller’s order with respect to rejection of claims 1-7 under section 3(d) is set aside.
Regarding section 3(e):
The court observed that nothing in the provision limits the application of the provision to a composition formed by the aggregation of known ingredients. The court noticed that the adjective “known” is used as a qualifier in sections 3(d), 3(f) and 3(p); however, the same is absent in section 3(e).
Further, the court also held that section 3(e) does not appear to be limited in its application to independent claims only. The court observed that the provision appears to exclude from patentability any composition claim for a substance that merely exhibits the aggregate properties of its constituents. The court disagrees with Novozyme’s argument that the grant of composition claims would not expand the scope of the patent; however, by this composition claim, the applicant would be in a position to institute infringement proceedings against any person who infringes their patent. The court held that this contention does not appear to be correct regarding claim 9; also, the independent claim protects the patentee’s rights against unauthorized use of the patented substance as an ingredient in a composition. Also, the court held that, in any event, a patent cannot be granted for a composition claim solely for this reason. Thus, the court upheld the Controller’s decision that in the absence of evidence that the composition is more than the sum of its parts, claims 8 – 11 should not be granted.
Therefore, the appeal was partly allowed with respect to claims 1 – 7 and partly refused with respect to claims 8 -11 and the direction was issued that the application shall proceed to grant on the modified terms.
Conclusion:
This judgement has further clarified the scope of section 3(d), specifically with respect to biochemical inventions. Clearly, the provision of section 3(d) also applies to biochemical inventions. However, it has been clarified that the enhancement of efficacy for the inventions should be examined more carefully rather than taking a narrow approach with respect to the activity of the product. This judgment also clarifies that there is no magnitude or numeric value to define the enhancement of efficacy. However, the parameter remains subjective, as the court held that such enhancements should be reasonable to the satisfaction of the Controller. Regarding section 3(e), the court held that the provision is not restricted to “known” ingredients. The applicant has to justify that the composition is more than the sum of its parts to overcome the hurdle of section 3(e).
This judgement, on the one hand, clarifies the scope of section 3(d) for biochemical invention, and on the other hand, it has raised the bar for section 3(e) by stating that the provision is applicable to all composition, even if it contains a new ingredient. The earlier approach taken by the applicants when a composition is claimed for a novel substance may no longer be applicable in view of this judgment.