This case is a Grand Panel decision of the IP High Court, which provided interpretations concerning industrial applicability under Article 29(1), main paragraph, of the Patent Act, as well as exemption from patent infringement under Article 69(3) of the Patent Act.
 
1. Relevant Provisions
Article 29(1), main paragraph, and Article 69(1) of the Patent Act stipulate as follows:
 

Article 29(1)
A person that invents an invention with industrial applicability may obtain a patent for that invention, unless the invention falls under any of the following categories: ...

Article 69(3)
A patent right for an invention directed to a medicine manufactured by mixing two or more medicines (medicine meaning a product used in the diagnosis, therapy, treatment or prevention of human diseases...) or for an invention of a process by which a medicine is manufactured by two or more medicines being mixed together has no effect against the act of preparing a medicine as per a physician's or dentist's prescription nor against medicines prepared as per a physician's or a dentist's prescription.

 
2. Case Overview
The plaintiff (appellant in the Appeal Court) is the patentee of Japanese Patent No. 5186050. Claims 1 and 4 of the patent read as follows.
 

1. A composition for promoting an increase in subcutaneous tissue, comprising:
autologous plasma,
a basic fibroblast growth factor (b-FGF), and
a fat emulsion.

4. A composition for breast augmentation, comprising the composition for promoting an increase in subcutaneous tissue according to any one of claims 1 to 3, for use in breast augmentation.

 
The defendant (appellee in the Appeal Court) is a physician at a clinic who provided aesthetic medical services including breast augmentation surgery. At issue in this case was whether the defendant's act of administering：
- Agent A containing plasma and trafermin (b-FGF)； and
- Agent B containing Intralipos (a fat emulsion)
to a subject during breast augmentation surgery constituted patent infringement. The main issues and the court’s views are summarized below.
 
2-1. Issue 1: Fulfillment of Claim Limitations
The first issue was whether or not the action of the defendant corresponds to the production of a composition that satisfies the limitations of patent claim 4. Specifically, the two parties disputed whether the defendant mixed Agent A and Agent B to prepare a mixed composition prior to the administration, and if not, whether the administration of Agent A and Agent B separately to a subject corresponds to the production of a composition that satisfies the limitations of claim 4. The court concluded that there was no evidence showing that Agents A and B had been administered separately, and therefore, it could be inferred that a composition containing all the components of Agents A and B had been manufactured.
 
2-2. Issue 2: Industrial Applicability (Article 29(1), main paragraph, of the Patent Act)
The second issue was whether or not the claimed invention violated Article 29(1), main paragraph (industrial applicability). As guidance in relation to industrial applicability, the Examination Guidelines for Patents and Utility Models indicate that "a method for surgery, therapy or diagnosis of humans" (a "medical procedure") lacks industrial applicability, as follows.
 

The following methods (a) and (b) fall under the above "methods for surgery, therapy or diagnosis of humans":
(a) methods of treatment such as contraception and delivery on a human;
(b) methods that process substances collected from a human for the purpose of returning them to the same person for treatment (e.g., hemodialysis), or methods that analyze the substance during the processing.

 
The appellee argued that although the invention pertains to a "product", since it requires physicians to collect blood from the subject to obtain "autologous plasma", and the manufactured composition is directly administered subcutaneously by the physician, the invention is in essence a "method for breast augmentation" (i.e., a medical procedure) and, therefore, lacks industrial applicability.
 
However, the court stated that "Article 29(1), main paragraph, does not explicitly exclude from patent eligibility products to be administered to the human body, including compositions for use in breast augmentation such as the present invention", and that "it is difficult to interpret a product invention intended for administration to a human body as essentially a method invention involving a medical procedure and, therefore, not an industrially applicable invention".
 
2-3. Issue 3: Exemption from Patent Infringement (Article 69(3) of the Patent Act)
Another issue was whether or not the defendant’s actions fell under the exemption in Article 69(3) of the Patent Act, such that the effect of the patent right did not extend thereto. Article 69(3) stipulates that the effect of a patent right related to a medicinal invention involving the mixing of two or more medicines (i.e., products used in the diagnosis, therapy, treatment or prevention of human diseases) does not extend to acts of preparation based on a physician’s prescription, or to the medicines so prepared.
 
The Grand Panel held that the composition pertaining to the present invention is intended for breast augmentation—i.e., for aesthetic purposes—and cannot be regarded as a medicine used in the diagnosis, therapy, treatment, or prevention of human diseases. Therefore, the foregoing exemption was deemed not to apply.
 
Based on these and other determinations, the Court found infringement of the patent by the appellee, and damages corresponding to an 8% royalty rate were awarded.
 
3. Comment
This case attracted attention as it was only the second case in which public comments were invited following the 2021 revision of the Patent Act, which introduced the public comment system. Regarding medical-related acts, there has been longstanding debate over whether "upstream regulation" (excluding such acts from patent eligibility) or "downstream regulation" (restricting enforcement of rights) should be adopted. Japan currently adopts an upstream regulation, excluding acts of medical treatment from patent eligibility on the grounds of lack of industrial applicability, while also incorporating a downstream regulation in the form of limiting enforcement with respect to certain acts of preparing combined medicines.
 
The Grand Panel’s interpretation of Article 29(1), main paragraph, aligns with current practice as set forth in the Examination Guidelines, which exclude inventions related to surgery, therapy, or diagnosis of a human from industrially applicable inventions. While this appears straightforward under the current legal framework, the definition of "medical procedure" excluded from patent eligibility under Article 29(1), main paragraph, is not clearly defined in any laws or regulations, leaving practitioners to rely on illustrative examples, which has been a matter of debate.
 
With regard to the exemption under Article 69(3), the Court’s conclusion is also consistent with the text of the Patent Act and appears reasonable. Nonetheless, it has been pointed out that, in some cases, it may be unclear whether the purpose of certain procedures is "diagnosis, therapy, treatment or prevention of human diseases" or "aesthetic". Ongoing discussion and clarification of upstream and downstream regulation are anticipated.

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This article was provided by the International Information Group
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