Pankhuri Malik is an IPilogue Writer, IP Innovation Clinic Fellow, and an LLM Candidate at Osgoode Hall Law School.

On , the Federal Court of Appeal (“FCA”) the Federal Court’s decision, upholding the validity of two of Bristol-Myers Squibb (“BMS”) and Pfizer’s patents. The relevant patents concerned the active pharmaceutical ingredient Apixaban, used in thrombosis treatment. Apixaban is a selective inhibitor of the enzyme Factor Xa (“FXa”) which works by blocking certain blood-clotting proteins.

Through its lawsuit, and subsequent appeal, Pharmascience Inc. (“PMS”) challenged the validity of two of BMS’s patents, Canadian Patent Nos. 2,461,202 (“202”) and 2,791,171 (“171”) on different grounds.

The 202 patent describes the action of many FXa inhibitors, including Apixaban, in thrombosis treatment. This patent was challenged by citing BMS’s expired patent, Canadian Patent Number 2,349,330 (“330”) on the following grounds:

1. Lack of Status as a Selection Patent: Essentially, PMS alleged that the Federal Court did not identify the 202 patent as a selection patent and failed to appreciate that it does not disclose a special advantage over the 330 patent, which is essential for it to be recognized as a selection patent. The FCA, however, reaffirmed the lower court’s finding that a special advantage was disclosed by inference. FCA confirmed that Apixaban, under the 202 patent, was identified from the genus of compounds protected by the 330 patent because it was useful.
2. Anticipation and obviousness, falling within the broad ambit of double patenting: PMS also claimed that the 202 patent did not identify the inventive concept of the claims in issue. PMS claimed that since 202 does not disclose a special advantage, the patent is fatally flawed due to anticipation and obviousness. The FCA disagreed and reaffirmed Federal Court’s finding that apixaban’s inventive concept is that it is an effective FXa inhibitor useful in treatment of Thromboembolic disorders, as opposed to the 303 patent which only had the potential to be useful.
3. Insufficiency: Lastly, PMS challenged the 202 patent as Apixaban was not identified by the patentee at the date of publication of patent; PMS argued that this error constitutes insufficient of identification of the invention. The Court, however, disagreed PMS and held that the relevant specification for determination of sufficiency is the issued patent, and not the publicized patent.

The 171 patent relates directly Apixaban tablets’ formulation, particularly the particle size and dissolution rate of the medicine. The 171 patent describes the method of formulation such that it displays solution-like properties in the body, which optimize absorption.

The primary challenge was obviousness (as discussed ). The contention in this case pertained to a fifth additional component of the test, the “obvious to try” test. This component questions the validity of a patent on grounds that some inventions might be obvious to try due to their chemical structural similarity. PMS claimed that the Federal Court should have concluded that the claims in 171 are invalid because the invention was obvious to try.

However, FCA disagreed. The Court agreed with the lower court in that the formulations of the 171 patent are indeed inventive because a skilled person in the art would not have thought to reduce the particle size to improve absorption, or to target a lower dissolution rate. The FCA held that the lower court considered the correct and relevant factors in determining what would have been obvious to try to a person skilled in the art. The FCA confirmed that the lower court correctly held the patent valid.

Other jurisdictions

It is noteworthy that BMS and Pfizer’s patents for Apixaban have faced similar challenges outside of Canada as well. The companies have, so far, successfully enforced their patents in the . This Canadian decision adds another point to the companies’ win column.

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a) What are APIs?

APIs are prewritten combinations of , method calls and codes having different functionality tools which programmers use for their software as a prerequisite template to invoke certain common regular functionalities and further advances on their innovation software. Programmers can use APIs to save their time and energy in formulating codes for each function as, per the need of the program, from scratch. .

b) Are APIs protected under US Copyright Law?

Prior to Oracle’s copyright infringement claim, no one claimed monopoly over APIs. When Google used 37 API calls similar to Oracle’s Java SE computer program and copied 11,500 lines of code from it (which made up only 0.4 percent of the entire code), Oracle raised a claim of copyright infringement against Google. While copyright exclusivity is based on an author reaping its benefits for a certain period of time, the courts and Copyright Act also prevent this monopoly from hampering the public interest at large. Keeping that in mind, the SCOTUS appears to have based their decision on two Copyright Act limitations as they envisioned the consequence of their judgment. Primarily, as per United States Code Unannotated Title 17 - Section. 102 (b) of Copyright Act, copyright protection cannot extend to “any idea, procedure, process, system, method of operation, concept, principle, or discovery . . . .” Secondly, the author or the copyright holder cannot prevent another person from making a “fair use” of a copyrighted work. In view of this, the Google’s petition was entirely based on the defence of “fair use”, as they undisputedly copied Oracle’s copyrighted API code  verbatim. Accordingly, the bench was to decide whether Google’s use copyrighted code  for its Android operating system constituted “fair use” . However, the scope of this defence is far-reaching.

c) Applicability of the Fair Use Doctrine in Google LLC v Oracle America Inc.

In order to understand the fair use doctrine codified under Section. 107 of United States Copyright Act., the SCOTUS comprehended the use in four factors, which included:

1. The purpose, nature and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes”. It was interpreted that such use was in nature and to provide the programmers a different setup without eliminating the similar features for their Android platform. They added something new, with a further purpose to create distinct parallel environment for different computing environment (smartphones).
2. The amount and substantiality of the portion used in relation to the copyrighted work as a whole. The copied code was 0.4 percent of the entire API at issue, which consists of 2.86 million total lines. Hence, the code needs to be interpreted on entirety and its functionality as a whole.
3. And the effect of the use upon the potential market for or value of the copyrighted work – the showed that the Android platform which was developed was not a market substitute of the Java SE, hence the reimplementation of the similar functionality codes into a different environment was under the scope of fair use applicability.

The SCOTUS applies the fair use doctrine on a case-by-case basis based on mixed facts and laws . Hence,  copyright protection for APIs remains ambiguous and software developers and investors in the market remain uneasy. Further, it is imperative to note that Canada does not recognize the doctrine of fair use. However, Canada’s Copyright Act includes the similar principle of “fair dealing”, a narrower version of the former doctrine which may not excuse this type of copying, as Canadian courts do not recognise transformative use under fair dealing.

In conclusion, have noted that if copyright in APIs were exclusive to their author, many programmers would be in a vulnerable position, which would lead to a and hamper innovation. With this being said, the existence of such an exclusive right promotes licensing and royalties in the technology sector at a large scale.  

Written by Aishwerya Kansal, IPilogue Contributor. Aishwerya has completed her Masters in Law in International Business Laws at Osgoode Hall Law School, and she is currently working as an IP Law Clerk with Bereskin & Parr and is also an IP Innovation Clinic Fellow.

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