Framing a new defence

21.16 If a new medical treatment defence were to be recommended by the ALRC, it would need to be carefully framed to remedy specific problems resulting from the enforcement, or potential enforcement, of gene patents against healthcare providers. A new medical treatment defence could be framed to cover the use in medical treatment of all patented inventions or, more specifically, of patented genetic materials and technologies. However, in view of this Inquiry’s Terms of Reference, it would be difficult to recommend a defence unless it applied to in vitro procedures because most gene patents of relevance to medical treatment relate to procedures performed outside the body.

21.17 There are many difficulties involved in framing the scope of any new medical treatment defence. What class of patents should be covered by the defence? For the defence to be of practical application to the infringement of gene patents in the provision of healthcare, it seems clear that it would need to apply to in vitro testing and other procedures, and not just to procedures performed on or inside the body. Yet, the implications of exempting a broad class of diagnostic or therapeutic methods from claims of patent infringement would be significant, especially in relation to effects on investment and innovation in healthcare technology. These implications would have to be the subject of specific investigation and consultation. In addition, enactment of a new medical treatment defence specific to gene patents would need to be justified carefully in order to be consistent with Australia’s obligations under the TRIPS Agreement, which provides that patent rights shall be enjoyable without discrimination as to field of technology.[14]

21.18 The second major question in framing a new medical treatment defence is how to define the class of persons or organisations who should be able to invoke the defence. As discussed above, the United States medical treatment defence applies to medical practitioners, their assistants, and ‘related healthcare entities’. The latter term includes entities with which a medical practitioner has a professional affiliation under which the medical practitioner performs a medical activity,[15] for example, a hospital or clinic.

21.19 An important consideration in defining the class of persons protected from infringement proceedings is that most genetic testing is conducted by laboratories, rather than by medical practitioners. In Australia, most medical genetic tests are ordered by a clinical geneticist or other medical practitioner as part of the healthcare services provided by state and territory clinical genetics services. The testing itself is usually, but not always, carried out by public sector laboratories attached to public hospitals.[16] If the intention behind the defence is to protect the delivery of healthcare services—rather than to protect only medical practitioners from liability—the defence should also cover laboratories.

21.20 Whether medical practitioners need special protection in relation to gene patent infringement is an open question. It is arguable that medical practitioners should be entitled to refer patients for medical genetic testing as they see fit, without having to concern themselves with the existence or otherwise of relevant patent rights. It is not clear whether a medical practitioner would infringe a patent simply by referring a patient to a laboratory for testing.

21.21 A medical practitioner can be liable for indirect infringement of a patent where he or she has procured the infringement through inducement, incitement or persuasion (that is, contributory or indirect infringement); joined in a common design with someone else to engage in acts that infringe a patent (that is, as a joint tortfeasor); or authorised the infringement.[17] For liability to be established, the medical practitioner must have done something more than merely facilitate the infringement of the patent by another. He or she must have been a party to the act of infringement by taking part in it, such as by taking some positive step designed to produce the infringement, even though further action by others (that is, the laboratory) is also required.[18] Referral of a patient to a testing laboratory may be regarded as contributory infringement, but this may depend on the exact relationship between a referring medical practitioner and the testing laboratory.[19]

21.22 It is possible that patent holders may protect their patents by seeking injunctions or other remedies against medical practitioners who refer patients for unauthorised testing, as well as by taking action directly against the offending laboratory. However, the ALRC has received no evidence that patent holders have adopted such an approach to patent enforcement in Australia. Indeed, it is uncertain whether it would serve any useful purpose for a patent holder to do so, given the remedies available against laboratories.

[14] TRIPS Agreement, art 27(1).

[15] 35 USC s 287(c)(2)(C).

[16] In these cases, the medical practitioner and the laboratory will often be part of the same public health organisation (eg in New South Wales, the same area health service or statutory health corporation). See Health Services Act 1997 (NSW) Ch 2.

[17] See J Lahore, Patents, Trade Marks & Related Rights: Looseleaf Service (2001), [18,270].

[18] See Ibid, [18,270].

[19] Another consideration in such circumstances is the concept of innocent infringement. If a defendant has infringed a patent, it does not matter whether he or she knows of the existence of the patent, or whether he or she intended to infringe. However, a court will take account of the defendant’s innocence in determining the nature of the relief to be awarded. The extent to which a medical practitioner knows about the existence of patent rights may therefore be relevant to the remedies available against him or her: See Ibid, [18,345]; Patents Act 1990 (Cth) s 123.