Case Judgement http://www.plsbeta.com/LawOnline/law/content21.asp?

Casedes=2006L5084

2006 C L D 1038

[Lahore]

Before Umar Ata Bandial, J

SHIRE BIOCHEM INC. and others---Appellants

Versus

ENGLISH PHARMACEUTICAL INDUSTRIES---Respondent

F.A.O. No.147 of 2006, decided on 18th May, 2006.

(a) Patents Ordinance (LXI of 2000)---

----Ss. 61(1)(b), 39, 58 & 69---Relief in suit for infringement of patent---Scope---Manufacturer of

pharmaceutical product--Identical manufacturing process of the product---Original patent of appellants had
expired---Application for interim injunction by the appellants---Notwithstanding the admissions made by the
appellants, it was an established fact that they had a process registered under Patent Laws and that the
respondent admitted its product to be identical to the appellants' product---Statutory presumption under
S.61(1)(b) of the Patents Ordinance, 2000, was attracted to the facts of the case---Statutory presumption
under S.61(1)(b) of the Ordinance was available to the appellants' patent, and therefore, it was necessary that
the interests of the appellants be duly secured during the period that prima facie evidence on its patentability
was brought before the Trial Court to explain and displace' the admissions of the appellants brought on
record---Such reasoning would not support the grant of interim injunction to the appellants at the present
stage (first appeal from order), however, that could not authorize the respondent to manufacture and sell its
product without establishing the originality of its manufacturing process and, ' thus, its bona fides---
Respondent, to exonerate itself from the burden of the statutory presumption, must disclose and establish its
process for developing its allegedly infringing product, which could be established by the process of reverse
chemical analysis of the respondent's allegedly infringing product, wherefrom a fairly accurate picture about
the process employed by the respondent could be obtained---Two facts namely, expiry of original patent of
the appellants and the statement that the product of the expired patent was the active ingredients of the
appellants' product had diminished the appellants' prima facie case for an immediate injunctive order---
Refusal to issue injunctive order was also justified for a very weighty reason that was the plea of public
interest adopted by the respondent which tilted the balance of convenience in favour of respondent, as
respondent had stated that a public tender calling for medicine treating Hepatitis-B was floated by Prime
Minister Programme, respondent being the lowest bidder of an approved drug was declared the successful
bidder and a contract of 365000 tablets of the medicine within 35 days was awarded to the respondent---High
Court, in the interest of justice and in furtherance of the object of Patents Ordinance, 2000, directed that the
product of the respondent shall be tested and analysed by a competent international laboratory with prior
notice to and upon the criteria notified by the appellants; test and analysis shall be conducted forthwith and
their result shall be provided to the parties within one month of the date of present judgment---If the result
showed manufacturing process identical to that of the appellants', the latter shall have the right to move a
fresh application for interim injunction before the Trial Court which shall be decided on merits and material
on record at that time---Counsel for the parties objected on nationalistic considerations to the tests being

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conducted by laboratories in the jurisdiction of domicile of either of the parties or in Pakistan-High Court, to
promote credibility of the test reports, ordered that a laboratory in Malaysia or Singapore, neither country
having any connection with the parties to the suit, shall conduct and report on the relevant tests of the
respondent's product---National Public Health Laboratory of Malaysia at Selangor was designated in the first
instance, to conduct the necessary tests---If the said laboratory declined or was otherwise unable to conduct
the said tests and analysis, the Trial Court shall, with the consultation of the counsel for the parties order for
another laboratory to conduct the requisite tests and analysis, and shall treat the time to be of the essence.

Beecham Group Limited v. Bristol Laboratories Limited and another 1967 R.P.C. 406; Smith Kline
French Laboratories Ltd. and another v. Ferozsons Laboratories Ltd. and another 1992 MLD 2226, Glaxo
Group Limited and 2 others v. Evron (Private) Limited and another 1992 CLC 2382; Mere & Co. Ing. and
others v. Hilton Pharma (Pvt.) Ltd. 2003 CLD 407; Khawaja Tahir Jamal v. Messrs A.R. Rehman Glass 2005
CLD 1768; Acto Lab (Pvt.) Ltd. v. Pfizer Ltd. and others 2002 CLD 120; Biogen Inc. v. Medeva Plc 1997
RPC 1; Bristol Myers Squibb Co. v. Baker Norton Pharmaceuticals Inc. 2001 RPC 1 and Ebayinc etal v.
Mercexchange. L. L. C. (http://laws.findlaw.com/us/000/05-03.html) the U.S. Supreme Court on 15-5-2006
ref.

(b) Patents Ordinance (LXI of 2000)--

----Ss. 61(1)(b) & 58(2)---Suit for infringement of a patent---Application for interim injunction by
appellant---Original registration of the patent of appellants had expired---Exploitation of a patent by a
government agency---Public interest---Provision of S.58 of the Patents Ordinance, 2000 recognizes public
interest as a dominant factor for determining the outcome, inter alia, of infringement actions under the
Ordinance including application for provisional measures---Where the National Programme of Prime
Minister of the country declared an urgent need for supply of medicine for Hapatitis-B treatment, in such
situation S.58 itself allowed relief against infringement actions but subject to a right of hearing and
compensation to the patentee---Appellants, in the present case, having chosen not to avail their right of
hearing under S.58(2) of the Ordinance, they might however be justified to pursue remedies after establishing
infringement of their patent---Court's jurisdiction was conferred by law and was exercised in accordance
therewith; in the exercise of its jurisdiction the Court watches public interest as a predominant
consideration---Theory underlying injunctive relief in patent cases was recognized internationally to be
subject to the consideration of public interest---On the touchstone of public interest arising on account of the
medical emergency in the country as well as the expiry of the appellants' original patent, balance of
convenience was found by the High Court to be in favour of the respondent---High Court, therefore, ordered
that the respondent shall supply the contract quality of its product to the Prima Minister Programme and in
doing so, however, the respondent shall not supply its product either in the market or to any other person---
On account of the fact that the respondent shall be deriving advantage from a commercial bargain that
derogated alleged patent rights of the appellants, it was further directed by the High Court that prior to
making supply of medicine to the Prime. Minister Programme the respondent shall submit in the Trial Court
a Bank guarantee of a Scheduled Commercial Bank in the amount of the respondent's contract value supplied
to the Programme, issued in favour of the appellants for its encashment by appellants if they succeed in
establishing before the competent Court their case of infringement of their patent by the respondent.?

Beecham Group Limited v. Bristol Laboratories Limited and another 1967 R.P.C. 406; Smith Kline
French Laboratories L and another v. Ferozsons Laboratories Ltd. and another 1g92 MLD 2226. Glaxo Group
Limited and 2 others v. Evron (Private) Limited and another 1992 CLC 2382; Mere & Co. Ing. and others v.
Hilton Pharma (Pvt.) Ltd. 2003 CLD 407; Khawaja Tahir Jamal v. Messrs A.R. Rehman Glass 2005 CLD
1768; Acto Lab Pvt. Ltd. v. Pfizer Ltd. and others 2001 CLR 1852; Biogen Inc.- v. Medeva Plc 1997 RPC 1;

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Bristol Myers Squibb Co. v. Baker Norton Pharmaceuticals Inc. 2001 RPC 1 and Ebayinc etal v.
Mercexchange, L.L.C. (http://laws.findlaw.com/us/000/05-03.html) the U.S. Supreme Court on 15-5-2006
ref.

Hasan Irfan Khan and Mueen Qamar for Appellants.

Dr. A. Basit and Ijaz Rahim for Respondent.

ORDER

UMAR ATA BANDIAL, J..---These are two connected appeals filed against a common order dated
27-4-2006 passed by the learned Additional District Judge dismissing the appellants' applications for interim
injunction against the respondents in these appeals for restraining them from manufacturing, selling and
supplying the drug having generic name lamivudine (for convenience referred to as "lami") on account of
infringing the appellants registered Patent No.134736. The respondent in F.A.O. No.147 of 2006 is the
manufacturer in Pakistan of lami and the respondent in the connected F.A.O. 148 of 2006 is the seller and
distributor of the said drug in the market. The principal ground upon which the impugned order dated
27-4-2006 has declined interim relief to the appellants is that an Patent No.132128 registered by the
appellants in respect of the process producing lami expired on 7-2-2006 and, therefore, the appellants do not
have a prima facie claim for infringement.

2. Learned counsel for the appellants has strenuously assailed the view taken by the learned trial
Court by explaining the developments in the patented processes that have been overlooked. The invention of
the basic process to produce lami was patented in 1989, however, that product did not exist in a form that was
therapeutically human consumable. Through subsequent research. and development further processes were
invented whereby lami was refined to the point of being therapeutically human consumable with lesser
impurities and higher efficacy. The specific patent in respect of the process that produces such lami drug is
Patent No.134736 registered in Pakistan on 20-4-1995 with a U.K. priority date of 23-4-1994. Going by .the
period of protection under the Patents and Designs Act, 1911 (repealed in 2000) this drug is protected for 16
years until 2010. It is said that the respondent admits in para.5(1) of its written statement that the appellant's
drug 7EFFIX containing lami is manufactured under Patent No.134736. The contents of paragraph 5.1 of the
respondent's written statement read:

"5.1. The defendant's LAMUDINE drug is manufactured from the raw material (bulk Lamivudine)
being imported from and manufactured by Messrs Northeast General Pharmaceutical Factory,
Shenyoung Fine Chemical Co. Ltd. (hereinafter referred to as NEPGF), a Chinese company of 37
Zhonggong Bei Street, Tiexi District Sheyang, Peoples Republic of China Post Code: 110026
(hereinafter referred to as Defendant's process). The process through which the Messrs NEPGF is
manufacturing Lamivudine is a process different from all those processes contained and claimed by
the Plaintiffs in their alleged Patents Nos. 132128, 132680, 133215, 134736 and 135072. The detailed
process for synthesis of Lamivudine of Messrs NEPGF along with the comparison of the processes
contained in plaintiffs Patent No.134736 through which the Plaintiffs are manufacturing??????????
their??????????? ZEFFIX drug containing Lamivudine, is annexed as Annexure D to the written
statement."

3. Apart from the foregoing factual stand another plea taken by the respondent before the learned trial
Court is that the invention covered by the appellants' Patent No.-134736 is actually a patent of addition
falling under section 39 of the Patent Ordinance, 2000 ("Ordinance"). The provisions of section 39(1) are

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reproduced below:

"39. Patents of addition.---(1) Where an application is made for a patent in respect of any
improvement in or modification of an invention, hereinafter referred to as the "main invention", and
the applicant also applies or has applied for a patent for that invention or is the patentee in respect
thereof, the Controller may, if the applicant so requests, grant the patent for the improvement or
modification as a patent of addition."

4. It is the respondent's plea that the Patent No.134736 relied by the appellants is merely an
improvement or modification of the original Patent No.132128 which expired on 7-2-2006. Under section 40
of the Ordinance a patent of addition also has a term equal to the main invention and, therefore, it is the
respondent's case that Patent No.134736 has also expired as of 7-2-2006.

5. The learned counsel for the appellants has analyzed the foregoing pleas taken by the respondent.
On the one hand if the respondent in F.A.O. 147 of 2006 is manufacturing lami under a Chinese process that
is allegedly distinct from the appellants patented process then no case for infringement can be made out. On
the other hand, when the respondent simultaneously takes the plea that the appellants do not have a valid
patent to protect their process, then it implies that the respondent is applying the appellants process, as is also
the statutory presumption under section 61(1)(b) of the Ordinance. Therefore, the plea of the respondent
under section 39 of the Ordinance is alleged to be deflective and a mere ruse to avoid its duty to bring proof
that its chinese process is different from the appellants process.

6. With reference to documents filed by the respondents, learned counsel for the appellants submits
that the consignment of the allegedly infringing lami raw material was manufactured in July, 2005 from
which the drug of the respondent was manufactured in Pakistan in October, 2005. This is not denied by the
respondent. Accordingly, it is established on record that the infringing lami drug was manufactured by the
respondent during the admitted period of validity of Patent No.132128 which is alleged by respondents to
have expired on 7-2-2006, although the learned counsel for the appellant argues that it is valid for 20 years
under section 31 of the Ordinance until 7-2-2010.

7. Turning to the respondent's other plea under section 39 of the Ordinance learned counsel for the
appellants explained that Patent No.134736 protects a new invention and is not merely an improvement or
modification of the main invention recorded in the original but allegedly expired Patent No.132128 so as to
be a patent of addition. Going by the certificates placed on record by the appellants, the first being the cover
sheet of the certified copy of the specific granted Patent No.134736 and the other being the "letters patent"
document of the said patent, neither describes the said patent to be registered as a patent of addition. It is
explained that in the pharmaceutical trade the process of isolation or purification of different agents in a
chemical compound for obtaining a product with higher quality or a product with higher therapeutic effect
qualify as inventive steps. This is contemplated by section 9 of the Ordinance and to exemplify the point,
learned counsel for the appellants has relied on Beecham Group Limited v. Bristol Laboratories Limited and
another (1967 RPC 406). In that judgment the English Court of Appeal considered the development of
ampicillin as a derivative of pencillian nucleus called 6-aminopencillanic acid ("6-apa"). The process that
isolated 6-apa which led to the development of ampicillin as a drug was upheld to be a process that qualified
for a new patent. An informative passage at page 414 of the said report dealing with the derivative
development of the pharmaceutical reads:--

'There are two more patents equally important. They cover a derivative which has special curative
properties called ampicillin. The research workers found that by inducing a chemical reaction which

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is scientifically known as "acylating" the 6-apa, they could produce the drug called ampicillin. It is the
subject of two patents. One of these, No.873,049, in claim 1 claims a group of penicillin derivatives in
accordance with a specified formula; and in claim 5 a particular member of their group, alpha-amino-
benzyl pencillin, which for short is called ampicillin. The other Patent, No.902,703, claims the
discovery of the epimers, which are particularly valuable in producing ampicillin of the most effective
kind. Those two patents together cover a process for producing ampicillin, and the product itself. The
validity of these patents also has been challenged here today. But these two patents also have been
accepted so long and so wisely that we should accept for present purposes that they are valid.
Professor Chain said of these:

"The specific derivative of 6-aminopenicillanic acid, alpha-amino-benzyl-pencillin could not have

been predicted from the prior art. Still less could it have been predicted that that derivative would
have particularly useful properties. Indeed, the discovery of this most valuable antibiotic resulted
entirely and undisputedly from the work of Doyle, Nayler and Smith in the invention which forms the
subject-matter of British Patent No.873,049."

On all these points Sir Robert Robinson, who is of the highest eminence himself, confirms the views
of Professor Chain. He describes ampicillin as a "highly important novel preparation." In my opinion
we should assume prima facie the validity of these four patents."

8. In the present case learned counsel for the appellants submits that the inventive steps leading to the
therapeutically human consumable form of lami through the appellants Patent No.134736 in the shape of
their drug having the name Zeffix, is the process of "stereo-selectivity" which excludes from the lami Lewis
acids, that are highly reactive and unstable agents with toxic side effects. As a result, it is contended that after
satisfactory tests and trials, in 1995 the F.D.A. in the United States approved Zeffix for consumption and
marketing worldwide by the appellants. On the other hand, they maintain that there is no such approval in
respect of the respondent's lami product which is allegedly manufactured by the respondent under a hitherto
unproven and unapproved chinese process.

9. The learned counsel for the appellants has supported the foregoing submissions with another
factual disclosure. The first Patent No.132128 is owned by Shire Biochem, Inc., the first appellant in F.A.O.
147 and F.A.O. 148 of 2006. Shire Biochem however, never marketed its patented product until after the
developments introduced and the safety standards incorporated therein by the appellant No.2, namely, Glaxo
Group Limited which are the owners of the relevant and currently valid Patent No.134736 that was registered
four years later. It is explained that during these four years the appellant No.2 researched and developed the
processes that met the higher safety and therapeutic standards for human consumption of lami as contained in
their drug, Zeffix. In support of his case for interim injunction against the manufacture and supply of their
product by the respondent, the learned counsel for the appellants has relied on the following authorities Smith
Kline French Laboratories Ltd. and another v. Ferozsons Laboratories Ltd. and another (1992 MLD 2226),
Glaxo Group Limited and 2 others v. Evron (Private) Limited and another (1992 CLC 2382), Merc & Co.
Ing. and others v. Hilton Pharma (Pvt.) Ltd. (2003 CLD 407) and Khawaja Tahir Jamal v. Messrs A.R.
Rehman Glass (2005 CLD 1768).

10. On behalf of the respondent, the learned counsel has submitted that the controversy before this
Court is only in relation to interim relief which is dealt by the provisions of the Patent Ordinance, 2000 to be
granted as provisional measures under section 61(1)(a) of the Ordinance. Therefore, he submits that the
ordinary criteria of interim relief need not be followed strictly and the court ought to modulate its relief in the
light of the three main/principal reliefs that are available under the Ordinance. These are the reliefs of

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damages, injunction and accounts. He submits that whilst considering the matter of provisional measures the
Court should keep in mind the rule enshrined in the first proviso to section 61(1)(a) of the Ordinance
whereby, according to him, a product made by the defendant which is identical to a patented product, is
presumed to be produced by the patent process then the proviso reads:

"provided that the product obtained by the patented process is new if it has not been put into the
market for more than one year before the date of the initiation of the judicial action by the patentee."

11. In the present case he submits that admittedly the patented process of the appellants under Patent
No.134736 is not new and its product has been in the market since 1996, for longer than one year. As a result,
he submits that the statutory presumption does not apply in the present case so that the matter is one for
recording of evidence.

12. The second point raised by the learned counsel is that the appellants have made admissions in two
crucial documents to the effect that lami is the active ingredient in their product Zeffix. It is recalled that the
patent for that active ingredient, lami bearing Patent No.132128, has expired. Therefore, the pharmaceutical
compound lami which possesses the relevant medicinal qualities is available in the public domain and no
action for the infringement thereof is maintainable. The question whether Patent No.134736 constitutes an
independent patent being an inventive step rather than an improvement or modification of the original
expired patent is also in the light of the appellants admissions a matter of evidence that cannot be presumed
prematurely.

13. In the foregoing context, the learned counsel has referred to the petition for extension of the
expired Patent No.132128 filed by the appellants which is available on the record of the learned trial Court.
This petition contains the following statements:

"1.3. The petitioner researches, develops, manufactures and markets leading innovative prescription
drugs used to treat a number of diseases and conditions. Amongst the completely novel invented
products of substantial therapeutic importance, which has been discovered by the petitioner and
subsequently developed and marketed by GlaxoSmithKline Group of Companies, is a Compound
(including its processes of manufacture, its enantiomers, derivatives, and formulations/ compositions)
now known by the International Non-Proprietary name of Lamivudine, (subject-matter of Patent
No.132128) which is the active ingredient contained in the pharmaceutical products sold by the
GlaxoSmithKline Group of Companies, further details of which will be provided in the paragraphs to
follow." (Emphasis added).

14. The second admission is said to be contained in the product history of the appellants drug, Zeffix
given on their web site:--

"Product History.

Zeffix was discovered as BCH 189 on March 1, 1989 by Dr. Bornard Belleau and his research team in
BioChem Pharma Inc. of Quebec Canada. An agreement to licence the drug to Glaxo (now Glaxo
Wellcome), for worldwide development and marketing was signed in 1990."

15. Given the above admissions, the learned counsel for the respondent submits whether the patented
process for the appellants product constitutes an inventive step is a matter to be decided on evidence. He has
referred to section 60(2) of the Ordinance whereunder the respondent as a right to seek the revocation of a

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patent by way of defence in a suit for its infringement. In this connection he has referred to paragraph 3.7(I)
and (II) at pp.3-10 of the written statement wherein the respondent has sought revocation of inter alia, the
appellants currently valid Patent No. 134376.

16. As a pivotal point, learned counsel for the respondent submits that its product lamivudine
(Lamudive) is being supplied to the Government of Pakistan under a contract dated 10-4-2006 for 3,65,000
tablets for the Prime Minister's Program for Prevention and Control of Hepatitis. This contract was awarded
in competitive bidding wherein the appellants also participated but failed to match the lowest price offered by
the respondent. Also placed on record by the respondent is the contract with and the purchase order issued by
the Government of Pakistan both dated 10-4-2006 for supply of the medicine in one go. The contract
specifies that the package carton of the medicine supplied by the respondent shall bear the following notice:--

"NOT FOR SALE"

FOR USE ONLY BY THE
PRIME MINISTER'S PROGRAM FOR
PREVENTION AND CONTROL OF HEPATITIS"

17. In pursuance of the foregoing contract the National Program Manager, (Prime Minister's Program
for Preventive and Control of Hepatitis) Government of Pakistan 12-5-2006 has written to the respondent for
the urgent delivery of the contracted medicine in the following words:--

"3. It may please be noted that timely supply of Tablets Lamivudine is critical for this program to
initiate hepatitis B treatment interventions per plan. Moreover, in view of the high disease prevalence,
there is immense public pressure to initiate treatment facilities at the earliest. Messrs Biocare is
accordingly advised to pursue and arrange immediate supply of the said medicine within stipulated
time to avoid any future inconvenience."

Learned counsel submits that the present situation of high incidence of the disease having epidemic
proportions is catered by section 58 of the Ordinance as follows:--

"58. Exploitation by a Government agency or third person.---(1) Subject to subsection (2), where:

(i) the public interest, in particular, national security, nutrition, health or the development of other
vital sectors of the national economy so requires; or

the Federal Government may, even without the consent of the owner of the patent, decide that a
Government agency or a third person designated by the Federal Government may exploit a patented
invention.

(2) The Federal Government shall, before taking any decision under subsection (1), give the owner of
the patent and any interested person an opportunity of being heard if he wishes to be heard."

18. He adds that all laws are framed in the public interest and must be so interpreted by Courts of law.
Accordingly, in the foregoing circumstances of a national program constituted at the highest level by the
Government of Pakistan for control of hepatitis the provisions of section 58(1) of the Ordinance are to be
invoked in the public interest as otherwise the present supply of lami lying ready with the respondent shall
not reach the intended patients who are in dire need thereof.

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19. Finally, it is contended that the impugned order in any event provides requisite protection to the
appellants by ordering accounts to be strictly maintained by the respondent in respect of the supplies of
lamidine made by it. In support of his foregoing submission learned counsel he has relied on Acto Lab (Pvt.)
Ltd. v. Pfizer Ltd. and others (2002 CLD 120), Biogen Inc. v. Medeva Plc (1997 RPC 1) and Bristol Myers
Squibb Co. v. Baker Norton Pharmaceuticals Inc. (2001 RPC 1).

20. The learned counsel for the parties have made weighty and analytical submissions. In order to
assess their impact upon the outcome of the present controversy it is advantages to consider the facts in the
perspective of provisional measures. The Patent No.132128 registering the process to produce lami expired
on 7-2-2006 at the end of a 16-year term contemplated by the repealed Patent and Designs Act, 1911. Rule
24(5) of the Patent Rules, 2003 framed pursuant to the Ordinance reiterates a term of 16 years protection for
patents registered under the repealed Act. On account of the expiry of the said patent the case of the
appellants for infringement of patent has necessarily shifted to sole reliance upon their Patent No.134736
with a U.K. priority date of 23-4-1994. The appellants referred to the Beecham Group judgment of the
English Court of Appeal to exemplify that the process to make lami therapeutically human consumable is an
inventive step. However, that judgment concerns the development of a derivative compound with special
curative properties which is prima facie different from the present claim involving refinement of an existing
pharmaceutical for making it humanly consumable.

21. Indeed whether Patent No.134736 constitutes a novel, inventive step within the meaning of
sections 8 and 9 of the Ordinance qualifying for patentability under section 7 ibid is truly the central point of
the controversy between the parties. This is highlighted by the respondent challenge to the appellants Patent
No.134376 as a patent of addition and the corresponding attack in.para.3.7(I) & (II) of its written statement
for revocation of the appellants registered Patent No.134736. The key factor lending some credibility to the
challenge raised by the respondent are the statements made by the appellant acknowledging lami as registered
under the expired Patent No.132128 to be the "active ingredient contain in the pharmaceutical products sold
by the appellants". The foregoing statements dent the appellants case for infringement requiring them to bring
prima facie material to the trial Court that their registered Patent No.134736 records an

invention and not a mere improvement or modification of the original patent.

22. Indeed in the foregoing factual matrix, the Beecham Group judgment of the English Court of
Appeal is not apt. In fact there may be an instructive instance in Bristol Myers Squibb Co. v. Baker Norton
Pharmaceuticals Inc. (2001 RPC 1). Here the inventive step was stated to a different dosage of Taxol, a
cancer treatment drug, whereby its human consumability and, therefore, effectiveness was radically
improved. By drawing a distinction between discovery and invention the English Court of Appeal upheld the
High Court's conclusion in an infringement action that the patent was invalid and ordered its revocation. On
this point the Court of Appeal gave its reasoning as:--

"98. The part of the invention said to be unknown at the time of the Winograd lecture was the
reduction in neutropenia. But, for the reasons indicated by the judge, identification of that quality did
not require inventive skill over and above the skills already taught by Winograd, since the skilled man
armed with the latter information would or., at least could press on with the trials, and in so doing
inevitably find out the facts about neurtropenia. That would be a discovery, but not an inventive step.
The whole of the inventive nature of the process had already been disclosed by Winograd."

23. Notwithstanding the foregoing discussion that indicates grounds for ordering evidence to be

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recorded on the question of patentability of the appellants process in Patent No.134376 which also connects
with challenge of revocation by the respondent; there is important statutory criterion of evidence that must be
applied at the present stage' of provisional measures: This is the statutory presumption of infringement
contained in section 61(1)(b) of the Ordinance:-

"61. Reliefs in suits for infringement.---(1) In any suit for infringement the Court shall have the
power;

(b) to order, if the subject-matter of a patent is a process for obtaining a product, the defendant to
prove that the process to obtain an identical product is different from the patented process and that the
identical product in question shall, in the absence of proof to the contrary, be deemed to have been
obtained by the patented process provided that the product obtained by patented process is new if it
has not been put into the market for more than one year before the date of the initiation of the judicial
action by the patentee:

Provided that this provision shall apply subject to prior proof by the plaintiff that the allegedly
infringing product is identical to the product directly produced by the patented process:

Provided further that in the adduction of proof to the contrary, the legitimate interests of defendants in
protecting their manufacturing and business secrets shall be taken into account."

Notwithstanding the admissions made by the appellants, it is an established fact that they have a
process registered under Patent No.134376 and that the respondent admits its product to be identical to the
appellant's Zeffix. On these facts the foregoing statutory presumption is attracted to the facts of the case. The
question, however, is with what strictness would the presumption apply. The effort by the learned counsel for
the respondent to avoid the presumption on the basis of the first proviso to section 61(1)(b) of the Ordinance
is unhelpful because that would tend to dislodge the basic right of enjoyment of a patent that had a life of 16
years under the repealed Patents and Designs Act, 1911 and now validity for 20 years under the Ordinance.
Confining the enforceability of a patent to merely one year conflicts with the substantive provisions of the
Ordinance. Clearly, therefore, the proviso needs careful consideration and interpretation. This is an exercise
that is presently not necessary in the context of provisional measures.

24. Suffice it to say that the statutory presumption under section 61(1)(b) supra is available to the
appellants' Patent No.134736 and, therefore, it is necessary that the interests of the appellants be duly secured
during the period that prima facie evidence on its patentability is brought before the trial court to explain and
displace the admissions of the appellants brought on record. This reasoning may not support the grant of
interim injunction to the appellants at the present stage. However, that cannot authorize the respondent to
manufacture and sell its product without establishing the originality of its manufacturing process and,
therefore, its bona fides. To exonerate itself from the burden of the statutory presumption, the respondent
must disclose and establish its chinese process for developing its allegedly infringing product. Upon the
submission of the learned counsel for the appellants this can be established by the process of reverse
chemical analysis. of the respondent's allegedly infringing product wherefrom a fairly accurate picture about
the process employed by the respondent can be obtained. In the interest of justice and in furtherance of . the
object of the Ordinance it is, therefore, directed that the product of the respondent shall be tested and
analysed by a competent international laboratory with prior notice to and upon the criteria notified by the
appellants. The test and analysis shall be conducted forthwith and their result shall be provided to the parties
within one month of the date of this order. In case the result shows an identical manufacturing process to that
of the appellants, the latter shall have the right to move a fresh application for interim injunction before the

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learned trial Court which shall be decided on merits and material on record at that time.

25. The learned counsel for the parties object on nationalistic considerations to the tests being
conducted by laboratories in the jurisdiction of domicile of either of the parties or in Pakistan. To promote
credibility of the test reports, it is ordered that a laboratory in Malaysia or Singapore, neither country having
any connection with the parties to the suit, shall conduct and report on the relevant tests of the respondent's
product. With the assistance of the learned counsel, the National Public Health Laboratory of Malaysia at
Selangor is designated in the first instance, to conduct the necessary tests. In case the said laboratory declines
or is otherwise unable to conduct the said tests and analysis, the learned trial Court shall with the consultation
of the learned counsel for the parties order for another laboratory to conduct the requisite tests and analysis;
and shall treat time to be of the essence.

26. Turning now to the matter of the impugned supply of the alleged infringing product lamudine by
the respondent. As already discussed above, the two facts, namely, expiry of Patent No.132128 and the
statement that the product of the expired patent, lami, is the active ingredient of the appellants product, have
diminished the appellant's prima facie case for an immediate injunctive order. Its denial at the present stage is
justified for another very weighty reason. That is the plea of public interest adopted by the respondent which
tilts the balance of convenience in its favour. It is stated that a public tender calling for medicine treating
hepatitis-B was floated by the Ministry of Health under the Prime Minister's Program on 9-12-2005. The
submitted tenders were opened on 23-12-2005 in which the appellants as well as the respondent participated.
The respondent being the lowest bidder of an approved drug was declared the successful bidder. A contract
for supply of 365,000 tablets of the medicine within 35 days was awarded to the respondent on 10-4-2006.
Section 58 of the Ordinance recognizes public interest as a dominant factor for determining the outcome,
inter alia, of infringement actions under the Ordinance, including applications for provisional measures. The
letter dated 12-5-2006 by the National Program Manager of the Prime Minister's Program declares an urgent
need for supply of medicine for hepatitis-B treatment, in words that have already been noticed above. In
situations as the present one, section 58 ibid itself allows relief against infringement actions but subject to a
right of hearing and compensation to the patentee. The appellants have chosen not to avail their right of
hearing under section 58(2) of the ordinance; they may however be justified to pursue remedies after
establishing infringement of their patent.

27. The Court's jurisdiction is conferred by law and is exercised in accordance therewith. In the
exercise of its jurisdiction the Court watches public interest as a predominant consideration. The theory
underlying injunctive relief in patent cases is recognized internationally to be subject to the consideration of
public interest. In the United States jurisdiction, a four-factor test for grant of injunctive relief is ordinarily
followed. In EBAY INC. etal. v. MERCEXCHANGE, L. L. C. (http://laws.findlaw.com/us/000/05-30.html)
the U.S. Supreme Court on 15-5-2006 enumerated these tests as:--

. ''According to well-established principles of equity, a plaintiff seeking a permanent injunction must

satisfy a four-factor test before a court may grant such relief. A plaintiff must demonstrate: (1) that it
has suffered an irreparable injury; (2) that remedies available at law, such as monetary damages, are
inadequate to compensate for that injury; (3) that, c considering the balance of hardships between the
plaintiff and defendant; a remedy in equity is warranted; and (4) that the public interest would not be
disserved by a permanent injunction. See, e.g., Weinberger v. Romero-Barcelo, 456 U.S. 305,311-313
(1982); Amoco Production Co. v. Gambell, 480 U.S. 531, 542 (1987)."

28. In the foregoing judgment, the U.S. Supreme Court reversed U.S. Court of Appeal to settle a
debate on whether the aforesaid equitable principles apply to patent cases. The U.S. Supreme Court

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concluded as follows:--

"... Just as the District Court erred in its categorical denial of injunctive relief, the Court of Appeals
erred in its categorical grant of such relief. Cf. Roche Products v. Bolar Pharmaceutical Co., 733 F. 2d
858 (CAFed 1984) (recognizing the "considerable discretion" district courts have" in determining
whether the facts of a situation require it to issue an injunction").

Because we conclude that neither court below correctly applied the traditional four-factor framework
that governs the award of injunctive relief, we vacate the judgment of the Court of Appeals, so that
the District Court may apply that framework in the first instance. In doing so, we take no position on
whether permanent injunctive relief should or should not issue in this particular case, or indeed in any
number of other disputes arising under the Patent Act. We hold only that the decision whether to grant
or deny injunctive relief rests within the equitable discretion of the districts courts, and that such
discretion must be exercised consistent with traditional principles of equity, in patent disputes no less
than in other cases governed by such standards."

29. Accordingly, on the touchstone of public interest arising on account of the medical emergency in
the country as well as the expiry of the appellants' original patent, balance of convenience is found to be in
favour of the respondent. Therefore, it is ordered that the respondent shall supply the contract quantity of its
product lamudine to the Government of Pakistan. In doing so, however, the respondent shall not supply its
product either in the market or to any other person. On account of the fact that the respondent shall be
deriving advantage from a commercial bargain that derogates alleged patent rights of the appellants,
therefore, to safeguard the interests of the appellants, it is directed that prior to making supply of medicine to
the Government of Pakistan the respondent shall submit in the trial Court a bank guarantee of a scheduled
commercial bank in the amount of the respondents contract value supplied to the Government of Pakistan,
issued in favour of the appellants for its encashment by the appellants if they succeed in establishing before
the competent Court their case of infringement of their patent by the respondent.

30. Parties to appear before trial Court on 29-5-2006 for implementing above terms. Appeals disposed
of in the foregoing terms.

M.B.A./S-1 11 /L???????????????????????????????????????????????????????????????????????????????
Order accordingly.

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