Interpretation of Product-by-Process Claim is unified by Supreme Court in Japan

3/2016 14.9.2016
(Photo:istockphoto.com/dolgachov)
Product-by-process (PBP) claim has been a controversial matter in Japan. The subject-matter of the PBP claim is a product but specified with process. Since product inventions are often difficult to be drafted with their structure or characteristics but can be easily drafted with their process, the PBP claim is allowable in many countries.

However, there has been a conflict on the interpretation of the PBP claim between two main doctrines that the scope of the patented product covers: 1) products with the identical property or structure of the product manufactured by the claimed process (product doctrine) or 2) product obtained only by the claimed process (process doctrine). The interpretation of the PBP claim has been unclear among the patentability, validation and infringement stages for a long period.

Recently, the Japan Supreme Court has decided the interpretation of the PBP claim on all stages.

The patented invention in question is “pravastatin sodium containing less than 0.5% pravastatin lactone and less than 0.2% epiprava, prepared by process comprising the steps of: a) forming an organic solution of pravastatin; b) precipitating the pravastatin as a pravastatin ammomum salt; c) purifying the salt by recrystallization; d) transposing the salt to pravastatin sodium; and, e) isolating pravastatin sodium” registered as JP3737801 (‘801). During the examination, a product claim was rejected but a PBP claim was accepted, and thus, the patent was granted after deleting the product claim. The patent holder, Teva Pharma (Teva), corrected the specified amount of the two substances mentioned above to “less than 0.2% pravastatin lactone and less than 0.1% epiprava” during an invalidation trial requested by Kyowa Hakko Kirin Co., Ltd. (Kyowa-Kirin), a defendant of this case.

A pharmaceutical imported and sold by Kyowa-Kirin is within the scope of ‘801 but its manufacturing process was different from the process of ‘801.

Procedure and Grounds for Action

Tokyo District Court applied the process doctrine to the PBP claim “without specific circumstance such as difficulty of claim drafting other than being specified by process.” That is, the product doctrine is exception and in case that the invention of the PBP claim has difficulty to be drafted with their structure or characteristics but only can be drafted with their process, the product doctrine is applied. The Tokyo District Court found that the invention of ‘801 has no specific circumstance. Moreover, the defendant’s manufacturing process was different from the process of ‘801, the court decided that the activities of Kyowa-Kirin are not infringement.

The IP High Court held the Grand Panel and showed that the technical scope of the PBP claim should be considered as with the presence or absence of a specific circumstance such as difficulty of claim drafting without the process, and, categorized a PBP claim into a “correct PBP claim” or an “incorrect PBP claim.” The PBP claim with a specific circumstance is the “correct PBP claim” and the technical scope extends to products with the identical property or structure of the product manufactured by the claimed process. The “incorrect PBP claim” does not have any specific circumstance and the technical scope covers products obtained only by the claimed process.

By determining the PBP claim of ‘801 to be the incorrect PBP claim, the IP High Court upheld the decision of the Tokyo District Court that the defendant’s product did not infringe the ‘801.

Grounds for Appeal to Supreme Court and Outcome of Decision

Teva filed a final appeal. The Supreme Court decided that the PBP claim should be interpreted by the product doctrine on all stages: since the effect of the patent right of a product invention covers products with the same structure and property as the patented product regardless of its process, even when a product invention is specified with a process, the technical scope of both the patent right and the claimed invention should be determined as a product of which structure and properties are identical to the product manufactured by the claimed method.

The Supreme Court also decided that the PBP claim should satisfy the description requirement by considering the existence of a circumstance that the claimed product is ‘impossible or utterly impractical to be directly specified with its structure or property’ from the viewpoint of the contribution to developing industry by disclosing inventions. The reason is that since the structure or characteristic of the invention with the PBP claim is unclear, the public cannot clearly predict the scope of the invention and patent.

On the other hand, it is severe for patent applicants to be completely banned to draft PBP claims under the fast-to-file principle because some products cannot technically be analyzed their structure or property, or it takes an extremely excessive amount of cost or time to carry out some specific experiments for the analysis. However, it would not unjustifiably harm public interests if the scope of the patented invention is determined to cover products having the same structure and property as a product manufactured by a claimed process.

The Supreme Court therefore reversed the decision of the IP High Court, and thus, the case was remanded to the IP High Court. In the Supreme Court’s decision, opinions, explaining this case in detail by the Chief Judge Chiba and Judge Yamamoto, are attached.

Evaluation and Discussion

The background of this case is that the scope of the PBP claim has been interpreted differently between the patentability and infringement in Japan. The point of this case is to evaluate how to find a balance between patent holders and third parties. The IP High Court adjusted this unstable situation by categorizing PBP claims into the correct PBP claim or the incorrect PBP claim and mainly applied the process doctrine and exceptionally applied the product doctrine when the invention of the PBP claim has a specific circumstance. The Supreme Court applied the product doctrine as a basic principle of both of patentability and infringement. In terms of this unified interpretation, since the scope of the PBP claim becomes clear for patent applicants and public in the future, this Supreme Court’s decision may be valued.

The Supreme Court also decided that the patentability of the PBP claim should be denied by the description requirement, a formalistic issue, when patent rights with PBP claims have no specific circumstance. These new criteria of the description requirement of the PBP claim, ‘impossibility or utter impracticality’, is stricter than before.

Responding to the Supreme Court’s decision, Japan Patent Office (JPO) revised the Examination Guideline so to indicate that the PBP claim is only allowed when the claimed product is ‘impossible or utterly impractical’ to be defined with its structure or characteristics. The problem is that these criteria are also applied to opposition and appeal trials, this means, many invalid PBP patent rights potentially exist in violation of the revised description requirement because many patented PBP claims were granted without being examined the specific circumstances.

From this perspective, moderate practice will be desired for balancing the patent protection and third parties’ disbenefit.

Another infringement case on this patent (H24 (Ju) NO. 2658) was decided the same day and the Supreme Court applied the same reason about the interpretation of the PBP claim on patentability stage.

Ryoko Oshikamo
LL.M., PhD researcher
University of Helsinki

This work was supported by the Scandinavia-Japan Sasakawa Foundation (Grant NO. 2015). Prof. Dr. Rainer Oesch, University of Helsinki, is sincerely appreciated for his supervising.

Aiheet: Patentit