Novartis New Zealand v Aktiebolaget Hassle & Astra Zeneca Ltd

Court of Appeal

Blanchard, Tipping and Glazebrooke JJ, 24 June 2003, 4 July 2003

This was an appeal against an interlocutory injunction awarded pursuant to an allegation of patent infringement.  Novartis had counterclaimed for revocation of the patent on the grounds of obviousness. 

The respondents had held a patent for the compound omeprazole however this had expired on 18 April 2003.  They were, however, also the proprietors of a current formulation patent for the same compound.

The substantive issue was whether the formulation of Novartis’ generic omeprazole product infringed the respondents’ formulation patent. 

There was conflicting expert evidence as to whether the generic product infringed the patent.  There was also conflicting evidence as to the effect on the market of a wrongly awarded injunction. 

In relation to obviousness, both the UK Courts and lower Australian Courts had held equivalent patents to be invalid.  The Australian High Court had, however, applied a stricter test of obviousness and overturned the finding of invalidity in Australia.

The New Zealand Court of Appeal held that obviousness was plainly a question of fact to be determined on the basis of the evidence to be put before the Court.  It could not be assumed that in New Zealand the evidence for the patentee would be the same as in the UK (where it had not persuaded the Court and in that jurisdiction had led to the patent being revoked).  Further the test of obviousness to be applied in New Zealand “is not necessarily exactly the same as it was in England”.  There was therefore a serious question to be tried concerning infringement, notwithstanding the attack on the patent.

In determining the balance of convenience, the Court of Appeal noted that the position in the New Zealand pharmaceuticals market was complex due to the presence of only one main purchaser (being the Government’s pharmaceutical purchasing body, Pharmac).  The Court of Appeal agreed with the difficult and complex balancing exercise undertaken by the judge at first instance resulting in the award of the injunction.  The Court considered it inappropriate to disturb the judge’s discretionary decision as she had not applied any wrong principle of law, had not failed to consider any relevant matter or considered any irrelevant matter nor was she plainly wrong.