Posted: October 12th, 2018
Chugai Pharmaceutical v UCB & Celltech  EWHC 2264 (Pat)
In his judgment of 24 August 2018 Birss J held that Chugai was not required to pay royalties to UCB in relation to their immunosuppressive drug tocilizumab, marketed as Actemra.
The case concerned a worldwide licence granted by the First Defendant, UCB, to the Claimant, Chugai. The licence covered a portfolio of patents and provided that royalties were due on a product if that product fell within the scope of any of the relevant patents’ claims. By the end of January 2016 there was only one unexpired patent remaining in the portfolio, US patent 7 566 771. Chugai contended that tocilizumab did not fall within the claims of the US 771 patent; UCB disagreed. As the licence is governed exclusively by English law and the English courts, the question of infringement fell to be decided by Birss J.
It was common ground that the claims had to be constructed under US law. In the US patent system claim construction can be assessed by intrinsic evidence and by extrinsic evidence, with extrinsic evidence being considered less important. The judge reviewed the intrinsic evidence (the claims, description and prosecution history) and found that that none was conclusive as they could all either be read both ways or contained contradictory paragraphs. Extrinsic evidence is found outside the patent-related documents and includes expert and inventor testimony and dictionaries. Unlike the intrinsic evidence, the extrinsic evidence strongly supported Chugai’s position.
Chugai’s position would have been further helped by what is known as the “validity tie breaker” in the US. This is the principle that if a claim remains ambiguous having applied all the normal construction rules, then it should be construed in a way which preserves its validity. The principle is only applied where claims remain ambiguous after intrinsic and extrinsic evidence have been considered. In this case, there was a piece of US prior art (known as Queen) which it was agreed would have rendered the patent invalid on UCB’s construction.
In the end, however, Birss J considered the extrinsic evidence sufficient to find in Chugai’s favour. He concluded that tocilizumab does not fall within US 771, and Chugai are free to sell without paying royalties to UCB.
A copy of the decision can be read here.
Headnote: Scott Parker, Simmons & Simmons