Source IP - Digital Marketplace

IPAustralia have developed Source IP as a digital marketplace for sharing information, indicating licensing preferences and facilitating contact for IP generated by the public research sector in Australia.

Source IP is specifically aimed at making it easier for Australian businesses, including small business to access public sector innovation and technology and will strengthen the aims of Australian Government's Industry Innovation and Competitiveness Agenda - particularly the focus on boosting collaboration between science and industry.

Source IP is due for release late 2015.  For more information on Source IP please contact:

SourceIP@ipaustralia.gov.au

See the IPAustralia website for more information:

http://www.ipaustralia.gov.au/understanding-intellectual-property/commercialise-your-ip/source-ip-site/?utm_medium=email&utm_campaign=What%27s+New+at+IP+Australia+-+5+November+2015&utm_content=Source+IP&utm_source=www.vision6.com.au

Australian High Court clarifies inventive step threshold

On 2 September 2015, the High Court handed down a decision in the long-running AstraZeneca v Apotex battle, dismissing AstraZeneca’s appeal and finding the patent claims of its Australian CRESTOR (rosuvastatin) patent invalid for lack of inventive step. 

http://eresources.hcourt.gov.au/showCase/2015/HCA/30

The decision is consistent with the appealed Full Federal Court decision and has been described as a “conventional” decision. However, it is also significant in that, to date, invalidating a patent for lack of inventive step has been very difficult due to the somewhat convoluted requirements of the inventive step provisions under the Australian Patents Act (the Act). This has applied to both opposition process and litigation in the courts.

What does this decision mean for patent applicants in Australia? 

In summary, on a practical level, the decision clarifies that the inventive step of an Australian patent will be considered in reference to “relevant prior art information”, as it existed at the priority date, in light of the “common general knowledge” of the person skilled in the art. The decision clearly highlights that it is not permissible for an Examiner or the Court to use information from the body of the patent specification to determine inventive step when that information does not form part of the common general knowledge of a skilled person and is not disclosed in the prior art information.  The information in the body of the specification may be used in considering the inventive step of a patent if it is, in fact, disclosed in a prior art document or part of common general knowledge of a skilled person in the field. 

The High Court Decision

The High Court decision confirmed that:

(i) Different prior art documents may be considered separately as long as they meet the threshold requirement (“ascertained, understood and regarded as relevant”)(for patent applications filed before the Raising the Bar Amendments came into force in 2013). 

(ii) “The skilled person may well sort through all manner of information with a view to finding something that is regarded as relevant” and section 7(3) “places no embargo on the skilled person using combinations of sources of information”. 

(iii) It is not permissible to use information from the body of the specification to determine inventive step when that information does not form part of the CGK and is not disclosed in any prior art document falling within the scope of section 7(3) of the Act.  

This decision is considered a “sensible” and “conventional” decision from the High Court regarding the interpretation of sections 7(2) and 7(3) of the Act. Although the “ascertained, understood and regarded as relevant” restriction on prior art documents has now been removed from the Patents Act, there are still a considerable number of patents prosecuted and granted under the previous Act to which these interpretations will apply. 

See the link to our full article for a more detailed discussion of the case. 

https://www.dropbox.com/s/btmb28rigg5whom/Article%20-%20Australian%20High%20Court%20clarifies%20inventive%20step%20threshold_full%20article.pdf?dl=0

by Sarah Herbert

Australia should drop 'lucky country' tag and nurture entrepreneurs

http://www.theguardian.com/business/2015/oct/30/australia-should-drop-lucky-country-tag-and-nurture-entrepreneurs-report

Consultation on IPAustralia’s Proposed Examination Practice following the High Court Decision in D'Arcy v Myriad Genetics Inc

Further to our blog post last week on the High Court’s D’arcy v Myriad Genetics decision http://frankehyland.blogspot.com.au/2015/10/a-new-look-at-patentable-subject-matter.html IPAustralia have released a consultation paper regarding their examination practice in light of the decision.

http://www.ipaustralia.gov.au/about-us/public-consultations/Consultation-on-our-proposed-examination-practice-following-the-High-Court-decision-D'ArcyvMyriad-Genetics-Inc/

If you would like to discuss the matter further or wish to make any comment on the paper, please let us know. 

by Sarah Herbert

A New Look at Patentable Subject Matter in Australia: D’arcy v Myriad Genetics

On 7 October 2015, the High Court of Australia unanimously held that isolated nucleic acids are not a manner of manufacture under Australian law.

http://eresources.hcourt.gov.au/showCase/2015/HCA/35 

This is somewhat surprising and overturns the previous unanimous decision of the Full Federal Court of Australia, which upheld the initial Federal Court judgement. The decisions of the Full Federal Court held that isolated nucleic acids are a manner of manufacture as an “an artificially created state of affairs in a field of economic endeavour” that are a result of human intervention.

The test for patentable subject matter in Australia has long been that set out in the National Research Development Corporation v Commissioner of Patents (“NRDC“) case (1959).  That is, patentable subject matter is an ‘artificially created state of affairs’ in a field of economic endeavour.  The Full Federal Court concluded that an isolated nucleic acid sequence involved human intervention and was therefore an artificially created state of affairs.  However, the High Court took a different approach and concluded that the sequence information content of isolated nucleic acids is not “made” by humans but is instead naturally-occurring.  According to the High Court, isolation was the only man-made aspect of the invention, which they held was not sufficient to constitute “an artificially created state of affairs” as required by NRDC.

In D’Arcy v Myriad Genetics, the High Court cautioned against a formulaic application of the principles in the NRDC case.  The question of whether a new class of invention is patentable should be decided on a case-by-case basis, having regard to 6 key factors:

• Could patentability give rise to a large new field of monopoly protection with potentially negative effects on innovation?
• Could patentability have chilling effects on activities beyond the exclusive rights granted to a patentee?
• Would according patentability involve assessing important and conflicting public and private interests and purposes?
• Would according patentability enhance or detract from the coherence of the law relating to patentability?
• Is according patentability consistent with Australia’s obligations under international law and the patent laws of other countries?
• Does according patentability involve law-making which should be done by the legislature?

The High Court decision clearly highlights that  isolated nucleic acids are not a manner of manufacture, and therefore are not patentable subject matter.  The Court criticised the characterisation of isolated nucleic acids as a class of artificial chemical compounds as “elevating form over substance”.  The Court considered that the information stored in the nucleic acids coding for mutant or polymorphic BRCA1 polypeptide was an essential element of the claims in issue and concluded that information was the same as the information contained in the DNA of a person from which the nucleic acids were isolated.  Unlike the corresponding US Supreme Court’s Myriad decision, there was no decision by the High Court that cDNA or other nucleic acids sufficiently altered  by human intervention would constitute patentable subject matter.  It remains to be seen how this decision is interpreted by the Australian Patent Office and the existing holders of Australian patents to isolated nucleic acid sequences.

D’Arcy v Myriad Genetics has implications for the definition of patentable subject matter in Australia. While NRDC remains a relevant precedent, satisfying the criteria in NRDC alone is now unlikely to make contentious subject matter patentable.  This includes inventions relating to other naturally occurring substances, as well as business methods and computer-implemented inventions.  This decision suggests that broader policy factors will also need to be considered.  Rather than clarifying the position, the refining of the NRDC test and the focus on the “substance” or “essential element” of the invention in the decision may introduce uncertainty as to the scope of “patentable subject matter” in Australia.

by Sarah Herbert

IP and Free Trade Agreements

The era of bilateral and smaller multilateral trade agreements culminated on 5 October 2015 with the signing of the 12-nation Trans-Pacific Partnership, covering 40 per cent global economy. Like all trade deals, the TPP is primarily a political deal negotiated by politicians, and is seen as an attempt by the US and Japan to set up a Pacific rim economic zone that doesn’t include the world’s second largest economy, China. Intellectual property was one of the sticking points in the negotiations for this agreement, along with the time period for data lock-up for biologic drugs and tobacco and public health issues, among others. In regard to the inclusion of intellectual property in free trade agreements, the Australian Competition Policy Review (the Harper Review) issued its Final Report in March 2015. Recommendation 6 of that Report was an Intellectual property review by the Productivity Commission focusing on:
• competition policy issues in intellectual property arising from new developments in technology and markets; and
• the principles underpinning the inclusion of intellectual property provisions in international trade agreements.

As we reported on the 20 August 2015, the Treasurer and the Minister for Small Business asked the Productivity Commission to examine Australia’s intellectual property system, in light of the shift towards an innovation economy.

See: http://frankehyland.blogspot.com.au/2015/08/productivity-commission-to-look-at-ip.html

Economically, Australia needs to shift away from its heavy reliance on resources and primary industry. Business leaders and politicians alike are calling for Australia to focus on innovation and technology development in a number of different areas. This shift to innovation as a driving force in the economy is very much based on intellectual property. The Productivity Commission’s recommendations will need to factor in this shift to an innovation economy in its review.

The Commission will also need to consider the fact that Australia is currently party to 10 bilateral or plurilateral trade agreements which include IP chapters. Recently, Australia has recently signed Free Trade Agreements with Korea, Japan and China. In regards to IP protection in their respective countries, Korea, Japan and China have all agreed to provide Australian nationals with equally favourable treatment in relation to IP protection and enforcement. The IP chapter of the Trans Pacific Partnership will also need to be taken into consideration when this agreement is ratified by all signature countries. Free trade agreements largely designed to “reduce or eliminate tariffs and other barriers to trade”. While these free trade agreements are designed to increase trade between the signatory countries,  the Productivity Commission reported in 2010 that it had found 'little evidence from business to indicate that bilateral agreements to date have provided substantial commercial benefits' and that the 'increase in national income from preferential agreements is likely to be modest'. Regardless of whatever economic benefit Australia has or is likely to gain from the free trade agreements it is party to, the Productivity Commission will have to take into account Australia’s obligations under these free trade agreements in its review of Australia’s intellectual property system.

Further details can be found in the link to our full article below.

https://www.dropbox.com/s/vuoknbhr4fj8eaf/Article%20-%20IP%20and%20free%20trade%20agreements_full%20article.pdf?dl=0

by Sarah Herbert

The Process of Invention - Now and Then

http://www.economist.com/news/science-and-technology/21649448-patent-records-reveal-way-inventions-are-made-has-changed-over

Productivity Commission to look at IP Reform

http://www.smh.com.au/federal-politics/political-news/productivity-commission-to-look-at-intellectual-property-reform-20150818-gj1x3f.html

Research and Development Tax Incentives for the Australian Biotechnology Sector

As most businesses close another financial year and finalise their accounts and tax returns, it is a great time to consider the tax offsets and refunds available.

If your company has spent money on research and development activities during the year, then your company might be eligible for a Research and Development Tax Incentive.

The Research and Development Tax Incentive is a self-assessment program that is designed to encourage companies to actively engage in research and development. It provides:

• 45% refundable tax offset for eligible entities with an aggregated annual turnover of less than $20 million; or
• 40% non-refundable tax offset for all other eligible entities.

Do you know what your company can claim?

We have listed below some examples of the activities that, in certain circumstances, might qualify:
• Literature and knowledge review
• Testing and trialling beyond the laboratory
• Field trials e.g. testing whether results obtained in a controlled laboratory environment could be replicated in an uncontrolled environment
• Clinical trials conducted outside of Australia
• Manufacturing activities conducted within and outside of Australia
• Phase IV clinical trials e.g. testing the interaction of the developed drug with an existing commercial drug
• Production line and processing

The Australian Government has released specific guidance to the Biotechnology sector in terms of identifying and describing eligible research and development activities. The guidance also provides detailed case studies and describes the contemporaneous documentation required to substantiate a Research and Development Tax Incentive claim.

Please click on the link below to access this guidance:

http://www.business.gov.au/grants-and-assistance/innovation-rd/RD-TaxIncentive/Eligibility/Documents/BiotechnologySectorialGuide.pdf

If you would like to know more and if you would like assistance in preparing your Research and Development claim, then please contact Claire Thompson of thomoce on 0407 133 991.


by Claire Thompson of thomoce

The End for Innovation Patents?

In a previous blog entitled “The Economic Impact of Innovation Patents”, posted on 11 June 2015, we reported on the IP Australia investigation into the “economic value” of innovation patents.  See:

http://frankehyland.blogspot.com.au/2015/06/the-economic-impact-of-innovation.html

This report concluded that “the innovation patent is not fulfilling its policy goal of providing an incentive for Australian SMEs to innovate, and the evidence shows a reduced likelihood of patenting after participating in the innovation patent system”.  We have some concerns about the methodology and statistical rigour of this investigation.  However, it was considered persuasive by ACIP, the advisory body for IP Australia policy, which concluded that based on the apparent evidence of a lack of economic benefit, the Innovation Patent should be abolished.

IP Australia has recently released a consultation paper specifically mooting abolition of the innovation patent system,  see:

http://www.ipaustralia.gov.au/about-us/public-consultations/Consultation-on-the-ACIP-recommendation-on-the-innovation-patent-system/
.
The Paper seeks views from interested stakeholders on:
• ACIP’s revised recommendation; and
• Any alternate suggestions to encourage innovation amongst small to medium enterprises (SMEs).

Whilst we are of the view that the Innovation Patent requires changes, we think that it would be a dreadful mistake to throw out the entire system, just as the Australian innovation community has become accustomed to it and is starting to use it as a component of a targeted IP strategy.  Industries such as food technology and building products are important areas for using such a second tier patent system.

Innovation Patents enable users to obtain fast, targeted and enforceable protection for smaller inventions.  If the intention of policy is to encourage innovation, it seems counter-intuitive to remove a form of IP, particularly one suited to ‘entry level’ innovators.

We will be making submissions in support of the Innovation Patent system.  If anyone has examples or case studies illustrating their value, we would be delighted to hear from you.

Submissions on IP Australia’s Consultation Paper close on 28 September 2015

Learn Share Connect - Thursday 27 August 2015

https://www.eventbrite.com.au/e/accelerating-commercialisation-tickets-17842051055?utm_source=Product+Design+Language+Event&utm_campaign=7c3881a7d2-Accelerating_Commercialisation_8_4_2015&utm_medium=email&utm_term=0_f6da933ddd-7c3881a7d2-62648737

Australia not moving on TPP

http://biotechdispatch.com.au/australia-not-moving-on-tpp/#sthash.YvSAchME.GTwKIc67.dpbs

The Brilliant Conference 2015

Peter Franke will be one of the speakers at this conference in September.  Click on the link below for further information.

http://www.hospitalipevents.org/conference.php

New IP Material for Small Businesses

http://www.iponz.govt.nz/cms/iponz/latest-news/new-ip-material-for-small-businesses

New Country of Origin Food Labels

http://www.business.gov.au/news-and-updates/News-and-features/Pages/new-country-of-origin-food-labels.aspx

The Australian IP Report 2015

The Australian Intellectual Property Report, published by IPAustralia, is now in its third edition. The purpose of the report is to promote awareness and deliver the latest IP statistics. This report provides a collation of data and information about IP in Australia, and internationally, and how Australia compares against other countries.  The report focuses on the latest developments and evidence on IP, and includes a short introduction to each right administered by IP Australia in the appendix, for reference.  The second release of IP Government Open Data, which includes the latest data used in this report, was also published alongside this report.

http://www.ipaustralia.gov.au/about-us/what-we-do/reports/ip_report_2015/

Innovation at McDonalds Australia

I attended an American Chamber of Commerce luncheon this week where the speaker was Andrew Gregory, CEO of McDonalds Australia.  He spoke about innovation at McDonalds Australia.

As a regular at McDonald and a regular traveller to the USA, I have always been fascinated by how much more innovative and ‘upmarket’ the McDonalds restaurants are here in Australia by comparison, so I was interested to hear his thoughts on why the local organisation has been successful with regard to image and innovation.

His message boiled down to two key points:

1. They won’t be afraid to change or try something new, if it is something their customers really want; and
2. If a decision comes down to pleasing the customer or an internal stakeholder, McDonalds will ALWAYS do what pleases the customer.

So a customer-led approach to development, and an appetite for change are the keys to their success.

by Adam Hyland

Update on a European Unitary Patent

For those clients interested in patent protection in Europe, we have included a brief update on the move forward to a unitary European patent.

A unitary European patent and unified European Patent Court have been the subject of discussion for some decades now.  A unitary European patent is a European patent to which unitary effect is given for the territory of the Member States participating in the unitary patent scheme.  The unitary patent will co-exist with national patents and with classical European patents. The intention is that all patent owners will in future be able to choose between various combinations of classical European patents and unitary patents. Currently, various national courts and authorities of the contracting states of the European Patent Convention are competent to decide on the infringement and validity of European patents.  As noted by the EPO, in practice, this gives rise to a number of difficulties when a patent owner wishes to enforce a European patent in several countries: high costs, risk of diverging decisions and lack of legal certainty.  The Agreement on the Unified Patent Court will create, when ratified by all required EU Member States, a specialised patent court ("Unified Patent Court", or UPC) with exclusive jurisdiction for litigation relating to European patents and European patents with unitary effect (unitary patents).

However, it has never been possible to obtain full agreement by all Member States.  A proposal was put forward in 2010 by the European Commission to use “enhanced cooperation” as the way forward. This meant that the Member States that did not want to be part of the resulting system could effectively opt out. Two Regulations creating the Unitary Patent and an Agreement on the Unified Patent Court and language requirements were adopted in December 2012 and came into force in January 2013.  The Unified Patent Court Agreement needs to be ratified by Member States to be effective.  Once 13 Member States, including UK, France and Germany, have ratified the Agreement, it will come into effect.  The Unified Patent Court will be set up and the first Unitary Patents can be granted, having effect in each Member State that has ratified the Agreement.   As of May 2015, Austria, Belgium, Denmark, France, Malta and Sweden have ratified the Agreement.

On 5 May 2015, the Court of Justice of the European Union (CJEU) issued two separate judgments (C‐146/13 and C‐147/13) ruling on the validity of respective regulations on the administration of the unitary patent system (Regulations 1257/2012 and 1260/2012 of the Official Journal of the European Union).  The judgments were in response to a challenge from Spain that the regulations were invalid.  Effectively, Spain’s challenge was based on an allegation of inadequate legal basis for the Regulation, that it was wrong to let the Administrative Council of the EPO set renewal fee levels and the apportionment of renewal fees between Member States, and that there would be no requirement for a Unitary Patent to be translated into Spanish. This challenge was rejected.  Thus, there are no pending judicial hurdles at this time to the introduction of the Unified Patent Court, and therefore to the Unitary Patent.  It is possible for the EPO to set the level of the fees, including the “opt out” fee for those with existing European patents and patent applications to opt out of the jurisdiction of the Unified Patent Court.  It is likely that the level of grant and renewal fees set by the EPO will have a significant influence on how many applicants choose a Unitary Patent rather than the current potential bundle of national patents that can result from the grant of a patent by the EPO. Seven more Member States – including UK and Germany – are needed to ratify the Agreement on the Unified Patent Court. According to some European Associates, a single patent covering the whole of Europe may be implemented by the end of 2016.

by Sarah Herbert

The Economic Impact of Innovation Patents

Value in Innovation Patents? 
IPAustralia has released a new report on the economic impact of innovation patents (see link below).  As noted in the Executive Summary, “the great majority of Australian SMEs and private inventors appear to gain little benefit from the system.”  Research published in the report indicates that innovation patents have “some positive effects” but standard patents are found to have a bigger positive effect on firm survival, which was the one area of significant impact. The majority of SMEs and private inventors were found to file innovation patent applications once and never again, do not receive any enforceable right, and let their patent expire early because they see its value at less than the $110-$220 cost of renewal. Overall the report concludes that “the innovation patent is not fulfilling its policy goal of providing an incentive for Australian SMEs to innovate, and the evidence shows a reduced likelihood of patenting after participating in the innovation patent system”.

The Innovation Patent system was introduced following the Review of the Petty Patent System that was completed in 1995.  It found that there was a role for ‘second-tier patents’ as an alternative and more accessible form of industrial right protection for incremental innovations.  In our experience, innovation patents have been quite valuable for many clients as enabling quick and enforceable protection of smaller inventions and for strategic use as a litigation tool.  However, the success of the innovation patent system has been limited by the fact that the cost of enforcing an innovation patent is ultimately similar to the cost of enforcing a standard patent. While most practitioners acknowledge the need for a more accessible form of IP protection for smaller invention, innovation patents are not often considered as part of an overall IP strategy. As Australia moves towards its “innovation economy”, an innovation patent (or equivalent) has a place in encouraging smaller, incremental innovations.  The form that this takes remain to be seen.    

http://www.ipaustralia.gov.au/about-us/news-media-and-events/latest-news-listing/The-economic-impact-of-innovation-patents

by Sarah Herbert

Changes Ahead for Registered Design Protection

The Advisory Council on Intellectual Property (ACIP) has recently released a report on the designs system in Australia.  ACIP includes patent and trade mark attorneys, lawyers, rights owners and academics, and seeks to provide balanced guidance on issues referred to it by the Minister.  A process of consultation with users of the system and other stakeholders took place, so the views in the report are generally well considered.

The review is timely, as the Australian Design registration system was extensively amended in 2003, in the first major shake up since 1904.  The full report can be found here:

www.acip.gov.au/pdfs/ACIP_Designs_Final_Report.pdf

There were a total of 23 recommendations.  Many deal with a suite of amendments to correct anomalies in the legislation, and simplification and improvement of a range of technical issues in the legislation.  These proposals are overwhelmingly positive for IP developers.   Below are the highlights.

Hague Agreement – Simplify International Design Filings
One significant recommendation is to look more closely at joining the Hague Agreement.  This is an international system for filing and registration of designs, which would allow for very inexpensive international design registration.  Many Asian countries and the EU are members, and the US and Japan are in the process of joining.  It would be a great plus for Australian product developers, as it would cut the costs of international protection by 50% or more.

To join would require increasing the term of Design Registration in Australian to 15 years, from the present 10.  I have co-authored submissions, on behalf of AIPPI, supportive of Australia joining the Hague agreement.

Grace Period
This is a ‘get out of jail free’ provision.  For patents, disclosures by the applicant (or derived from the applicant without consent) in the 12 months before  filing a complete application are not part of the  prior art, and cannot be cited.  This is only true for Australia and certain other countries, for example the US, Canada and Malaysia.

There is no such provision for designs. The report recommends a 6 month grace period, but that the applicant must file a declaration about their prior use when filing.  The latter is unnecessary administrative red tape. The main users of the grace period is likely to be SMEs without detailed IP knowledge, and they are unlikely to meet this requirement.

In the AIPPI submission, we proposed a 12 months grace period (to match patents) without formalities.  We will keep pushing for this when possible.

We will keep you posted once a government response is received.

by Peter Franke