The Evolution of the Doctrine of Sound Prediction in Canada: Darwin Would Not Be Impressed

I. Introduction

The doctrine of “sound prediction” first entered patent law as a patent-friendly way of protecting useful inventions. However, the doctrine has now evolved in Canada to a point where patents covering life-changing inventions of great public value are being routinely struck down on the ground that they lack utility.

The most recent, but in no way singular, example demonstrating the evolution of this doctrine is Apotex Inc. v. Sanofi-Aventis (Clopidogrel FC) where the patent claiming the medicine, clopidogrel, was invalidated for inutility-lack of sound prediction (10 PLIR 26, 1/6/12). ¹Apotex Inc. v. Sanofi-Aventis, 2011 FC 1486 [hereinafter Clopidogrel FC]. The Clopidogrel FC decision is noteworthy but not an outlier. In 2011, twelve decisions were handed down addressing the issue of utility-sound prediction. Decisions invalidating pharmaceutical patents for a lack of utility in infringement or revocation proceedings include the following: Eli Lilly & Co. v. Teva Canada Ltd, 2011 FCA 220, 94 CPR (4th) 95, leave to appeal to SCC refused [2011] SCCA No 362 (QL) [Atomoxetine FCA]; Sanofi-Aventis Canada Inc. v. Apotex Inc., 2011 FCA 300, [Ramipril FCA]; Ratiopharm Inc. v. Pfizer Ltd., 2009 FC 711, 76 CPR (4th) 241 [Amlodipine besylate], affirmed 2010 FCA 204, 87 CPR (4th) 185 (FCA does not comment on utility), Eli Lilly Canada Inc v. Novopharm Limited, 2011 FC 1288 [Olanzapine FC] and Apotex Inc. v. Sanofi-Aventis 2011 FC 1486 [Clopidogrel FC]. Decisions where allegations of inutility were found to be justified in Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 as amended [PM(NOC)](Patent Act s. 55.2) hearings include the following: Apotex Inc. v. Pfizer Canada Inc., 2011 FCA 236, 95 CPR (4th) 193 [Latanoprost FCA]; Eli Lilly Canada Inc. v. Apotex Inc., 2008 FC 142 [Raloxifene FC], 2009 FCA 97, 78 CPR (4th) 388 [Raloxifene FCA], leave to appeal to SCC refused [2009] SCCA No 219 (QL); Pfizer Canada Inc. v. Ratiopharm Inc., 2010 FC 612 [Revatio FC]; AstraZeneca Canada Inc. v. Apotex Inc., 2010 FC 714, 88 CPR (4th) 28 [Esomeprazole FC] ; GlaxoSmithKline Inc. v. Pharmascience Inc., 2008 FC 593, 72 CPR (4th) 295 [Valacyclovir FC]; and Pfizer Canada Inc. v. Apotex Inc., 2007 FC 26, 59 CPR (4th) 183 affirmed 2007 FCA 195, 60 CPR (4th) 177, leave to appeal to SCC refused [2007] SCCA No 371 (QL) [Sildenafil FCA]. Clopidogrel is an anti-clotting drug that is unquestionably a useful and, indeed, life-saving medicine as the second most prescribed drug in the world. ²Ron Winslow, Plavix Rival Gains from Studies. Wall St. J. (30 Aug. 2010). Its contribution to society has been profound. Yet, the patent was found invalid for not being “useful” under the Canadian Patent Act (Act). ³Clopidogrel FC, supra note 1 at para. 786. Not surprisingly, no other court anywhere in the world has made a similar finding. Invalidating the patent on the basis of inutility-lack of sound prediction shows how far the doctrine has strayed from its foundation in case law, the statute, and good public policy.

This article reviews the history of the doctrine in Canada and highlights how the doctrine has now evolved to a point where it lacks a proper foundational basis in the statute and is contrary to sound public policy. The current iteration of the doctrine should be set aside or re-cast to its roots to enable patent policy that supports innovation.

II. Origins of the Doctrine of Sound Prediction

The analysis of Canadian patent law should begin with a reminder that patent law is wholly statutory so the underpinnings of the doctrine must be found in the Patent Act. ⁴Apotex Inc. v. Sanofi-Synthlabo Canada Inc., [2008] S.C.R. 265; 69 C.P.R. (4th) 251, at para 12, citing Synthon B.V. v. SmithKline Beecham plc, [2006] 1 All E.R. 685, [2005] UKHL 59, at paras. 57-58.^,
5Patent Act, R.S.C. 1985, c. P-4, as am. With this reminder, the following cases demonstrate the evolution of the doctrine in Canada.

(a) Olin Mathieson Corporation v. Biorex Laboratories Ltd.
⁶Olin Mathieson Corporation v. Biorex Laboratories Ltd., [1970] R.P.C. 157 [Ch.D.] [Olin Mathieson]

Sound prediction in Canada “was given serious shape and substance by” Olin Mathieson. ⁷Apotex v. Wellcome Foundation, [2002] 4 S.C.R. 153 [AZT], at para. 60. Notably, this case was based on Section 32(1)(i) or “fair basis,” rather than Section 32(1)(g) or utility. ⁸Patents Act, 1949 (U.K.), 12, 13 &14 Geo VI, c. 87, s. 32(1)(g) and (i). Indeed, the plea of inutility was specifically withdrawn before the hearing. ⁹Olin Mathieson, supra note 6.

The patent claimed compounds that were useful as tranquillizers. “Sound prediction” arose in the context of whether a claim, covering unsynthesized and/or untested compounds, was unduly broad. The often quoted ratio is as follows: ¹⁰Cited with approval and adopted in AZT, supra note 7 at para. 62 and Monsanto Company v. Commissioner of Patents, [1979] 2 S.C.R. 1108, at 1116 [Monsanto].

If it is possible for the patentee to make a sound prediction and to frame a claim which does not go beyond the limits within which the prediction remains sound, then he is entitled to do so. Of course, in so doing he takes the risk that a defendant may be able to show that his prediction is unsound or that some bodies falling within the words he has used have no utility or are old or obvious or that some promise he has made in his specification is false in a material respect; but if, when attacked, he survives this risk successfully, then his c1aim does not go beyond the consideration given by his disclosure, his claim is fairly based on such disclosure in these respects, and is valid. ¹¹Olin Mathieson, supra note 6 at 193.

In determining that there was not undue claim breadth, the court relied on experiments that were not disclosed in the patent, information published after the patent issued, and utility in fact. Significantly, the court noted that what matters are the results achieved as the consideration supporting the patent:

But if it be true, and it appears to be true from works … subsequent to the date of the patent, that such enhanced activity is obtained by the use of the –CF₃ substitution, then it is clear that the plaintiffs have in fact “contributed, and indeed contributed considerably, to the common stock of human knowledge” by their invention… . In my judgment, it is what the patentee has actually achieved and not what he has promised (provided, of course, his promise is not false) which matters from the point of view of consideration… . ¹²Id. at 195.

Thus, the doctrine was intended to be a supporting doctrine, designed to allow patenting of inventions where conclusive proof of utility did not exist as of the filing date. The court recognized the patentee’s contribution to society, placing importance on the merits and practical utility of the invention over any promise (so long as not false). The dispositive issue was utility in fact with the burden on the challenger to prove lack of utility.

(b) Monsanto v. Commissioner of Patents. ¹³Monsanto, supra note 10.

The origins of the doctrine in Canada can be traced to Monsanto, which imported Olin Mathieson. The Supreme Court of Canada (SCC) heard the appeal of a decision of the Commissioner of Patents rejecting a patent as too broad and inadequately supported.

The invention claimed a genus of compounds useful in the vulcanization of rubber, but only three had been exemplified and tested. The Court held that the foundation for the rejection was not utility, but rather Section 36(1) or sufficiency of the disclosure in teaching “how to use” the invention. ¹⁴Patent Act, supra note 5, s. 2 and 36(1) (now 27(3)). In addition, the SCC held that: “It is important to note that while the substances without utility had not been tested, the true cause of the invalidity was the fact that they were without utility, not that they had not been tested before the patent was applied for.” ¹⁵Monsanto, supra note 10 at 1116 (emphasis added). Accordingly, to establish that a prediction was unsound, evidence of inutility in fact was required, just as in Olin Mathieson.

In Monsanto, the doctrine was again a patent preserving principle permitting claims to untested compounds. The SCC recognized both the importance of permitting inventions claiming chemical substances of predicted utility and the necessity of evidence of inutility in stating:

It is hardly necessary to point out how serious it would be in the field of patents for chemical substances to reject practically all possibility of claiming protection on the basis of sound prediction of utility….

Here what [the Commissioner of patents] has said in approving the decision of the Board is in effect “I am not satisfied you are entitled to it.” In my opinion the Commissioner cannot refuse a patent because the inventor has not fully tested and proved it in all its claimed applications. …. If the inventors have claimed more than what they have invented and included substances which are devoid of utility, their claims will be open to attack. But in order to succeed, such attack will have to be supported by evidence of lack of utility. At present there is no such evidence and there is no evidence that the prediction of utility for every compound named is not sound and reasonable. ¹⁶Id. at 1121-22.

(emphasis added)

Thus, under Monsanto, a prediction does not require proof, and a patent applicant that meets the standards of novelty, unobviousness and usefulness is entitled to a patent. Without evidence of inutility, neither the Commissioner nor the courts have any basis to refuse the patent due to alleged inutility.

(c) Apotex v. Wellcome Foundation.
¹⁷AZT, supra note 7.

The SCC next addressed the doctrine in AZT. The patent at issue claimed a new use of the old compound in treating HIV/AIDS in humans. The Court considered whether this was an “inventive use”. ¹⁸Id. at para. 3.

In the lower courts, the Trial Judge ruled that the doctrine of sound prediction was not relevant. ¹⁹Apotex v. Wellcome Foundation (1998), 79 C.P.R. (3d) 193 at paras. 96-100 (F.C.T.D.) [“In other words, one must differentiate between a lack of utility and a lack of testing… . In the case before the Court, the claimed utility was conclusively established… subsequent to the claimed date of invention. It remains a primary drug in the treatment of HIV/AIDS. It is thus apparent that even though the testing was subsequent to the claimed date of invention there is no evidence of inutility.”] The Court of Appeal (FCA) similarly held and went a step further noting that the patent will be valid if the asserted utility is true:

[T]he patent will not be invalid if it turns out that the speculation is valid at the time the patent is attacked. In Ciba-Geigy, this Court held that “if indeed what is in the patent specification was mere speculation or prediction, the speculation or prediction having turned out to be true, ought to be considered to have been well founded at the time it was made.”

In other words, so long as an inventor can demonstrate utility or a sound prediction at the time a patent is attacked, the patent will not fail for lack of utility. The time at which usefulness is to be established is when required by the Commissioner of Patents or in court proceedings when the validity of the patent is challenged on that ground… .

To conclude that evidence of actual utility subsequent to a patent’s priority date may not be introduced to demonstrate that an invention meets the requirements of the Patent Act would produce illogical results…. In my view, to so conclude would require a Court to close its eyes to continuing scientific advancements, and would disentitle patentees to rely on the instinctive sparks that so often engender great discoveries.” ²⁰Apotex Inc. v. Wellcome Foundation Ltd., (2000), 10 C.P.R. (4th) 65 at para. 50 (F.C.A.) [citations omitted] [AZT FCA].

This is entirely consistent with Olin Mathieson, Monsanto and the statute.

The SCC disagreed and also changed the doctrine dramatically. First, it cited Section 2 of the Act as the statutory basis for sound prediction; and second, it removed the requirement for evidence of lack of utility. ²¹AZT, supra note 7 at para. 56 [If a patent sought to be supported on the basis of sound prediction is subsequently challenged, the challenge will succeed if, per Pigeon J. in [Monsanto, citation omitted], the prediction at the date of application was not sound, or, irrespective of the soundness of the prediction, “[t]here is evidence of lack of utility in respect of some of the area covered.”] With all due respect to the SCC, this is ground zero in the faulty evolution of the doctrine of sound prediction in Canada. It steps away from Olin Mathieson and Monsanto by taking sound prediction out of the realm of sufficiency into utility and it forevermore changes the law of utility such that a patent in Canada can fail for inutility without proof of inutility. By casting sound prediction as a test for patentability irrespective of the soundness of the prediction (utility in fact), the Court opened Pandora’s Box. Ostensibly, the SCC did so to guard against diluting the doctrine to allow patents on a lucky guess or mere speculation. ²²Id. at para. 69.

AZT became the seminal case on the doctrine of sound prediction and is often quoted as the test:

The doctrine of sound prediction has three components. Firstly, as here, there must be a factual basis for the prediction. …. Secondly, the inventor must have at the date of the patent application an articulable and “sound” line of reasoning from which the desired result can be inferred from the factual basis. …. Thirdly, there must be proper disclosure. Normally, it is sufficient if the specification provides a full, clear and exact description of the nature of the invention and the manner in which it can be practised. ²³Id. at para. 70. (citations omitted)

The AZT Three-Part Test

(i) Factual basis.

The factual basis was the in vitro activity of AZT in a human cell and mouse data from another retrovirus. ²⁴Id. at para. 73. This is noteworthy compared to recent jurisprudence where the courts have rejected even human clinical data as neither demonstrating nor soundly predicting utility. Very few compounds from preclinical research reach clinical testing in humans, and even fewer meet the rigorous standards of safety and efficacy for regulatory approval. ²⁵Joseph A. DiMasi, Success Rates for New Drugs Entering Clinical Testing in the United States. 58 CLIN PHARMACOL THER.:1 (1995). At best, the in vitro activity in AZT was a predictor of a contemplated use. But, the SCC considered it sufficient nonetheless due to differences in regulatory and patent laws. ²⁶AZT, supra note 7 at para. 77. Inexplicably, the lower Canadian courts have largely ignored this distinction.

(ii) “Articulable and sound line of reasoning”

The articulable line of reasoning in AZT was a hypothesis that the “Glaxo/Wellcome scientists believed that the reverse transcription stage, unique to retroviruses, offered the best target for a drug.” ²⁷Id. at para. 8. It was noteworthy that the Court accepted the inventor’s hypothesis, which is appropriate as what may be a lucky guess to some is inventive ingenuity to another and that nothing more than a hypothesis, which may not have been correct, was required.

(iii) Disclosure

Disclosure was not an issue in AZT, but the SCC’s citation of H.G. Fox, Olin Mathieson and Monsanto, in which the line of reasoning was not disclosed in the patent is notable. ²⁸H.G. Fox The Canadian Law and Practice Relating to Letters Patent for Inventions (4th ed. 1969) [hereinafter Fox]. Disclosure should be read in this context and must mean an enabling disclosure of how to use.

It is also clear that the SCC was not articulating a new disclosure requirement when it stated that the issue was not before the Court. Accordingly, the Court was merely affirming that the disclosure required for sound prediction is the same as the requirement for sufficiency and that in “this sort of case”, i.e., a patent for a new use of a known compound, the use (and therefore the utility) comprises the invention and disclosure will take place in any event. ²⁹AZT, supra note 7 at para. 70.

It is therefore difficult to understand how the Canadian courts ³⁰Notably, Raloxifene FC, supra note 1 and Raloxifene FCA, supra note 1, Clopidogrel FC, supra note 1, Atomoxetine FC, supra note 1 and Atomoxetine FCA, supra note 1). have interpreted this case as requiring the factual basis and articulable line of reasoning to be in the specification. In doing so, the doctrine has lost any remaining statutory footing.

III. Recent Cases

The lower Canadian courts have caused the doctrine to evolve from its roots in upholding a patent directed to claimed subject matter not yet made or tested to a primary ground of invalidity. Ironically, rather than diluting the doctrine as warned in AZT, the courts have elevated it to discriminate against pharmaceutical patents where there is no debate of utility-in-fact. ³¹The FCA in AZT FCA, supra note 20, cautioned against discriminating against pharmaceutical patents at para. 54:Finally, if the Court in CIBA-Geigy intended to hold that a higher standard of utility is required for pharmaceutical inventions, as opposed to other inventions, this may be explained by the fact that the decision in Ciba-Geigy preceded the establishment of Canada’s international treaty obligations under the North American Free Trade Agreement and the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights. Both of these agreements, which have been incorporated into domestic law, prohibit discrimination based on field of technology. Thus, this Court may not hold pharmaceutical inventions to a higher standard of utility than it does other classes of inventions. See Section III, page 12, infra and also Figure 1, infra, for comparison of pharmaceutical versus nonpharmaceutical patents.

In the fifty (50) years prior to AZT, Canadian courts decided only eight (8) pharmaceutical patent cases on the basis of inutility. Since AZT, there has been an exponential increase, and in 2011 alone, twelve (12) decisions were rendered on the basis of utility. ³²Arvie Anderson & Lawrence Welch, “The Canadian Patent Promise: A Concern for Pharmaceutical Innovators?” IPO COMMITTEE NEWSLETTER (Dec. 2011) available at http://www.ipo.org/AM/Template.cfm?Section=Patents&Template=/MembersOnly.cfm&ContentID=32110&FusePreview=False. at p. 29 [IPO membership required]. This frequency should be troubling in a country committed to innovation. ³³Canada stated public policy includes a commitment to the life sciences research. See http://www.ic.gc.ca/eic/site/lsg-pdsv.nsf/eng/home. A full discussion of these decisions is too much for this paper, but this article will highlight a few examples.

The modern judge-made rubric for assessing utility under s.2 of the Act, requires the following:

(1) Construing a “promise”; ³⁴Eli Lilly Canada Inc. v. Novopharm Ltd, 2010 FCA 197, at para. 93.

(2) Determining whether the promise is demonstrated or soundly predicted;

(3) Identifying the factual basis for any prediction;

(4) A line of reasoning for any prediction; and

(5) Disclosure of the factual basis and line of reasoning in the patent specification.

This is a non-statutory test for utility unique to Canada. ³⁵Norman Siebrasse, “What is the Promise of a Patent?” (Mar. 14, 2011) http://www.sufficientdescription.com/2011/03/what-is-promise-of-patent.html. Moreover, with each decision carrying the test a bit farther away from its statutory foundation, this rubric now places pharmaceutical patentees in Canada in an untenable position with respect to patentability.

Construction of the Promise – Implicit and Explicit
³⁶Novopharm Limited v. Eli Lilly and Company, 2010 FC 915 [Atomoxetine FC]; aff’d Atomoxetine FCA, supra note 1.

The patent in Atomoxetine claims an old compound in a new method of use. The court applies the above judge-made rubric for assessing utility. This decision is remarkable for both its assessment of the “promise” and for its finding that the utility had not been demonstrated. The court characterized the “promise” as the use of atomoxetine as a treatment for ADHD, ³⁷Atomoxetine FC, id. at para. 32. but also found “implicit” was a promise that atomoxetine would work over the long term. ³⁸Id. at para. 112. The data supporting the patent was a six-week human clinical study, which was conducted before the patent was filed. ³⁹Id. at para. 20. The court reviewed the expert evidence critiquing this study and concluded:

If the MGH Study was not adequate to demonstrate the clinical usefulness of atomoxetine to treat ADHD the bare fact that some positive experimental data emerged is not enough. ⁴⁰Id. at para. 112.

The court then considered sound prediction and found that the disclosure requirement was not met because there was no reference to the study in the patent. ⁴¹Id. at para. 120.

The FCA agreed, holding that it was difficult to see what Lilly gave to the public in exchange for the grant of the monopoly. ⁴²Atomoxetine FCA, supra, note 1, at para. 51. This was striking because that first clinical trial provided the basis for regulators to approve further clinical study ⁴³A new chemical compound is studied for its effectiveness to be a new medicine in preclinical studies, which are test tube and animal tests, and in three phases of human clinical development. Each phase increases in size (number of patients). which, along with the patent, spurred the investments to develop atomoxetine into a novel and inventive treatment of ADHD. Until the discovery and disclosure by the inventors, that invention was unknown to the public.

This illustrates the fallacy of the modern rubric for assessing utility in Canada. The court confuses whether an invention is useful under the patent laws with the testing required to establish or prove utility. ⁴⁴The courts have frequently refused to accept even human clinical trials as demonstrating or being predictive of utility. Health Authorities are independent bodies staffed by experienced scientists and medical practitioners intent on protecting the public. It is the role of these agencies, not the patent office or courts, to weigh whether an invention having a human use has sufficient merit to be tested in humans. The courts should refrain from second-guessing this and, in the absence of evidence of inoperability, should accept any human testing.

Furthermore, the “quid” that underlies the bargain of the patent (the “quid pro quo”) was the enabling disclosure of how to use atomoxetine for the treatment of ADHD. Until the discovery and disclosure, that invention was unknown to the public, which is why it was found to be novel and inventive. The underlying proof that atomoxetine is effective, whether it is pre-clinical or clinical studies, ⁴⁵A new chemical compound is studied for its effectiveness to be a new medicine in preclinical studies, which are test tube and animal tests, and in three phases of human clinical development. Each phase increases in size (number of patients). has no bearing on the “quid” given to society. Only if the invention were inoperable would the public be denied its “quid” in exchange for patent.

Sound Line of Reasoning
⁴⁶Olanzapine FC, supra note 1.

In Olanzapine FC, the Federal Court noted olanzapine was useful in treating schizophrenia, and held that the specification taught how to make and use the invention. ⁴⁷Eli Lilly Canada Inc. v. Novopharm Ltd, 2009 FC 1018, at para. 154; rev’d 2010 FCA 197 [Olanzapine FCA]. In fact, olanzapine, has improved the lives of countless patients suffering from schizophrenia. It has been widely recognized by numerous innovation awards. ⁴⁸The Prix Galien Award, Queens Award for Enterprise in the Innovation Category, and the Pharmaceutical Manufacturer’s Association Discoverer’s Award. Even Novopharm’s witness, characterized olanzapine as the “closest thing to magic in a pill I’ve ever seen.” ⁴⁹Dr. Wirshing Cross-examination, Trial Bundle, Vol. 29, pp. 182-83.

The patent claims olanzapine and its use to treat schizophrenia. However, the court found the patent invalid for inutility-sound prediction; holding that the line of reasoning available to the inventors at the filing date failed to rise to the level of a “prima facie reasonable inference” that the promise of the patent was met. ⁵⁰Olanzapine FC, supra note 1 at paras. 217-9 and 267.

The olanzapine patent disclosed a variety of tests including animal models and actual clinical tests in human patients. The U.K. Court of Appeal in parallel litigation remarked that the information in the patent is much greater than that generally provided in a patent for a new pharmaceutical compound. ⁵¹Dr. Reddy’s Lab. (UK) Ltd. v. Eli Lilly & Co., [2009] E.W.C.A. Civ. 1362, at para. 11.

However, this same information was insufficient in Canada, not for want of disclosure but for a lack of sound prediction. ⁵²Olanzapine FC, supra note 1 at para. 264. Despite copious studies over eight years of research, according to the court, Lilly had simply not done enough work. Oh, how far the doctrine of sound prediction has evolved from Monsanto, where inutility in fact was necessary to invalidate a claim including untested compounds and AZT where in vitro data alone was adequate in a wholly uncharted disease.

Disclosure
⁵³Clopidogrel FC, supra note 1.

In Clopidogrel FC the patent claims the compound clopidogrel bisulfate. The court found that the patent makes an explicit promise of use of the compound in humans. ⁵⁴Id. at para. 145. The court then reviewed the data from a human trial conducted at the time the patent was filed ⁵⁵Id. at para. 339-42. and concluded that the expert evidence demonstrates that the early results obtained prior to the end of the study did not provide sufficient information to be conclusive ⁵⁶Id. at para. 348. thus did not demonstrate the utility of the patent. ⁵⁷Id. at para. 349.

The court then considered sound prediction and concluded that there was a factual basis for the promise of the patent. ⁵⁸Id. at para. 400. The factual basis included extensive studies in vivo and ex vivo studies over years of research. In considering whether there was a prima facie reasonable inference of utility, ⁵⁹Id. at para. 402. the court reviewed the evidence of the years of work that was done prior to the filing of the patent and found that Sanofi had a sound line of reasoning upon which to predict that clopidogrel had pharmacological activity. ⁶⁰Id. at para. 563. However, when the courts considered disclosure, despite the clear utility and a finding that the patent taught how to make and use the invention, the court found that the patent did not sufficiently disclose the factual basis and sound line of reasoning because there is no reference in the patent to Sanofi’s extensive “track record” of work and then concluded Sanofi did not give anything to the public in exchange for the grant of the monopoly. ⁶¹Id. at para. 585.

This again highlights just how far the doctrine of sound prediction has strayed. Sanofi “gave” the public a new compound that became a life saving medicine. Its patent fully enabled a person skilled in the art to make and use the invention. It unquestionably provided the “quid” and met its end of the patent bargain. ⁶²Free World Trust v. Électro Santé Inc., [2000] 2 S.C.R. 1024, at para. 13. The “track record” and testing data was not necessary in any way to practice the invention and is wholly irrelevant to the statutory question of whether an invention is “useful.” By requiring this “enhanced disclosure”, Canada undermined the very purpose of the patent system. ⁶³Id.

IV. The Doctrine of Sound Prediction Must Be Reassessed

The doctrine of sound prediction has evolved well beyond its original intent as a patent saving doctrine and is now contrary to sound public policy.

a) Disclosure of the “Inventive Solution” Is Required

The SCC could never have intended for AZT to be used to invalidate valuable pharmaceutical patents of practical utility. The SCC was cognizant of the fact that the patent system exists to encourage the public disclosure of inventions, not the underlying basis for those inventions:

A patent, as has been said many times, is not intended as an accolade or civic award for ingenuity. It is a method by which inventive solutions to practical problems are coaxed into the public domain by the promise of a limited monopoly for a limited time. ⁶⁴AZT, supra note 7, at para. 37. (emphasis added).

However, the bargain goes both ways and, if there has been proper disclosure of the inventive solution, there is an obligation on the Government and the courts to uphold the patent.

Whether the invention disclosed was the product of brilliant or poorly reasoned research, inventive intuition, reasoned hypothesis or even a lucky guess by a genius or ordinarily skilled artisan does not change the fact of the contribution to the public. Furthermore other statutory sections and practical considerations adequately hedge against rewarding patents on “lucky” guesses. A whimsical guess is less likely to provide an inventive step, that is to be unobvious, and practically in the fields of pharmaceutical and chemical science where the doctrine of sound prediction almost exclusively has been applied, the costs of research, including testing in vitro and in vivo, and patent filings precludes such investment on meritless ideas and guesses. Perhaps most directly, Section 27(3), which governs sufficiency, is more than adequate to protect against wholly speculative uses or unduly broad claims as such claims are unlikely to be enabled.

b) Public Policy Demands Predictability and Should Encourage Disclosure

If patentees in the pharmaceutical field had known in advance that the measure of “useful” in Canada was going to become whether a “promise” extracted from the wording of the specification was soundly predicted according to the current rubric, they could have avoided the problem by simply drafting specifications to avoid making any promises of any kind, or watering down any such statements to be so modest as to be meaningless. However, this would conflict with the patent ethos which encourages the disclosure of information concerning new inventions.

Further, patents are subjected to challenges alleging a lack of sound prediction years after the patent is filed and issued. Accordingly, unsuspecting applicants who originated their cases through the Patent Cooperation Treaty (PCT) in countries respecting Article 29(1) of TRIPS (trade related aspects of intellectual property rights agreement) (reproduced in Article 5 of the PCT) have their patents invalidated by Canadian courts applying disclosure requirements unique to Canada that did not exist at the filing dates of the patents. Moreover, these changes have been made in the absence of legislative change to the Patent Act.

V. Conclusion.

Utility and sound prediction need to be re-grounded in the Patent Act. Section 2 of the Act provides that “invention” means any new and useful art, process, machine, manufacture or composition of matter, or any new and useful improvement in any art, process, machine, manufacture or composition of matter. An invention is useful if it has a scintilla of utility for the use disclosed as a matter of fact. Nothing more is required by statute.

Unfortunately, the doctrine of sound prediction has evolved away from its roots in Olin Mathieson and Monsanto, and now has improperly introduced new disclosure requirements that are not founded in statute or sound public policy. Moreover, Canada is now the only major industrialized country in which a useful invention can be struck down for inutility without even a finding that the invention lacks utility-in-fact.

As a result, the courts or Parliament should

• (i)    return the doctrine of sound prediction back to its roots in Section 27(3) where the question of whether a claim is overly broad (exceeds what was invented) is measured by the teaching on how to make and use the invention;

• (ii)   re-establish that the standard of utility and whether an invention is “useful” in a single standard that requires a scintilla of utility for the use described; and

• (iii)  establish that inutility must be proven as lacking a scintilla of utility for the use described to support a finding of inutility.