Federal Court of Appeal clarifies implied licence doctrine

The Federal Court of Appeal clarified the doctrine of implied licence in Pharmascience Inc. v. Janssen Inc., 2024 FCA 10.

The proceedings related to Pharmascience’s generic version of paliperidone palmitate (PP), an injectable antipsychotic used for the treatment of schizophrenia and schizoaffective disorder that is sold by Janssen as INVEGA SUSTENNA.

In Janssen Inc. v. Pharmascience Inc., 2022 FC 62, the Federal Court held that the product monograph for Pharmascience’s product would induce infringement of Janssen’s patent (the 335 Patent).

The 335 Patent discloses a dosing regimen that ensures an optimum plasma concentration-time profile of PP. In most patients, this consists of two loading doses at 150 and 100 mg equivalents (mg-eq) followed by monthly 75 mg-eq maintenance doses. In patients with reduced kidney function, the loading doses are 100 and 75 mg-eq and maintenance doses of 50 mg-eq.

Three findings must be made for a determination of inducement. First, the act of infringement must be completed by the direct infringer. Second, the acts of infringement must be influenced by the acts of the alleged inducer to the point that, without the influence, direct infringement would not take place. Third, the influence must knowingly be exercised by the inducer.

Pharmascience argued that the Federal Court erred with respect to the first prong of the test. It claimed that no direct infringement would occur if it did not provide its generic PP in a 75 mg-eq dose, which is an essential element of all the claims of the 335 Patent.

Pharmascience argued that Janssen’s sale of 75 mg-eq doses grants an implied licence for the purchaser or prescribing physician to use the doses in any way they choose, including in combination with other doses of Pharmascience’s generic PP product in carrying out the regimen described in the 335 Patent.  

The Federal Court of Appeal noted that the sale of a patented article without restriction generally includes the right to use the article as the purchaser pleases. However, in this case, the 75 mg-eq dose is not itself a patented article but merely a component of the 335 Patent.

The Court held that to grant an implied licence, the sale of all the components of a patent must occur. The purchase of 75 mg-eq doses from Janssen did not come with an implied license to combine with other doses of PP from other sources and practice the invention of the 355 Patent.

Pharmascience Inc. v. Janssen Inc., 2024 FCA 10