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Alphapharm Pty Ltd v H Lundbeck A/S

Alphapharm Pty Ltd v H Lundbeck A/S

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HIGH COURT OF AUSTRALIA
CRENNAN, KIEFEL, BELL, GAGELER AND KEANE JJ
ALPHAPHARM PTY LTD APPELLANT
AND
H LUNDBECK A/S & ORS RESPONDENTS
Alphapharm Pty Ltd v H Lundbeck A/S
[2014] HCA 42
5 November 2014
S97/2014
ORDER
Appeal dismissed with costs.

On appeal from the Federal Court of Australia
Representation
S C G Burley SC with C Dimitriadis for the appellant (instructed by King & Wood Mallesons)
R M Niall QC with K J Howard SC for the first respondent (instructed by Corrs Chambers Westgarth Lawyers)
Submitting appearance for the second to fifth respondents
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

Intellectual property – Patents – Extension of term – Application to extend time for applying for extension of term of patent – Section 71(2) of Patents Act 1990 (Cth) required application for extension of term of patent to be made during term of patent and within six months after latest of three specified dates – First respondent made application for extension of term of patent during term of patent but more than six months after latest of three specified dates – Whether Commissioner of Patents had power to grant extension of time.
Words and phrases − "filing, during the term of a standard patent", "prescribed action", "relevant act".
Patents Act 1990 (Cth), ss 70(1), 71(2) and 223.
Patents Regulations 1991 (Cth), reg 22.11(4)(b).

CRENNAN, BELL AND GAGELER JJ. The issue in this appeal is whether s 223(2) of the Patents Act 1990 (Cth) ("the Act")[1] conferred power upon the second respondent, the Commissioner of Patents ("the Commissioner"), to extend the time within which the first respondent, H Lundbeck A/S ("Lundbeck"), may apply under s 70 of the Act for an extension of the term of its Australian Patent No 623144 ("the Escitalopram Patent")[2].
[1]As in force at the time of the hearing before the Administrative Appeals Tribunal (13-17 August 2012).
[2]That description distinguishes the Escitalopram Patent from Lundbeck's earlier Australian Patent No 509445 ("the Citalopram Patent") (described below) and conforms with the descriptions given to both in complex, related patent litigation. See Alphapharm Pty Ltd v H Lundbeck A/S (2008) 76 IPR 618; H Lundbeck A/S v Alphapharm Pty Ltd (2009) 177 FCR 151.
The appellant ("Alphapharm") appeals from a decision of the Full Court of the Federal Court of Australia dismissing an appeal from a decision of the Administrative Appeals Tribunal ("the Tribunal"). There were two questions before the Tribunal concerning s 223(2). The first was whether s 223(2)(a) conferred power on the Commissioner to grant an extension of time in respect of an application for an extension of term filed during the term of the patent. The second, which depended on the first question being answered "yes", was whether the Commissioner's delegate erred in exercising the discretion to grant Lundbeck an extension of time within which to make an application for an extension of the term of the Escitalopram Patent[3].…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2014] HCA 42
Decision Date: 5 November 2014

CaseChat Overview and Summary

The High Court of Australia considered an appeal by Alphapharm Pty Ltd against H Lundbeck A/S concerning an application for an extension of the term of a patent for the pharmaceutical substance escitalopram. The dispute centred on whether the Commissioner of Patents had the power to grant an extension of time for Lundbeck to make its application for an extension of the patent term, which had expired on 13 June 2009. Lundbeck had made its application during the patent term but more than six months after the latest of the dates specified in s 71(2) of the *Patents Act 1990* (Cth).

The primary legal issue before the High Court was the interpretation of s 71(2) of the *Patents Act 1990* (Cth) in conjunction with s 223(2) of the same Act. Specifically, the court had to determine whether the Commissioner of Patents possessed the power under s 223(2) to extend the time limit prescribed by s 71(2) for making an application for an extension of a patent term, or if the time limit in s 71(2) was an absolute bar that could not be extended.

The High Court reasoned that s 223(2) of the *Patents Act 1990* (Cth) conferred a broad power on the Commissioner to extend time limits prescribed by the Act, subject to certain exceptions. The court found that the time requirement in s 71(2) was not an absolute bar to the Commissioner's power to extend time. Instead, the court interpreted the relevant regulation, reg 22.11(4)(b), as excluding only the first time requirement in s 71(2) from the general remedial power in s 223(2)(a). Therefore, the Commissioner had the power to extend the second time requirement stipulated in s 71(2). The appeal was dismissed with costs.

Orders

Orders of the court

Appeal dismissed with costs.

Background

Background to the litigation

These reasons will show that Lundbeck's construction is correct and that the appeal should be dismissed. Notwithstanding an awkwardness in its reasoning, the Full Court was correct to conclude that the Commissioner has power under s 223(2) to extend the time requirement calculated by reference to s 71(2)(a), (b) and (c). The background facts A little more needs to be said about the Escitalopram Patent. Lundbeck, a Danish pharmaceutical company, applied for the Escitalopram Patent[31] on 13 June 1989 (the expiry date of which became 13 June 2009[32]), for an invention entitled "(+)-Enantiomer of citalopram and process for the preparation thereof". There are six claims – claims 1 to 5 are product claims and claim 6 is a method claim, which, for present purposes, can be put to one side[33]. Claim 1 claims a compound (an enantiomer) known as "(+)-citalopram" and its non‑toxic acid addition salts, and claims 3 and 5 claim a pharmaceutical composition comprising, as an active ingredient, that compound. The pharmaceutical substance disclosed in the complete specification, (+)-citalopram, is used to treat depression[34]. [31]As a Convention application; see Act, Ch 8, Pt 2. [32]Pursuant to the operation of s 4 of the Patents (World Trade Organization Amendments) Act 1994 (Cth) ("the 1994 Act"), amending s 67 of the Act. Section 67 provides: "The term of a standard patent is 20 years from the date of the patent." The "date of the patent", in this case, is the date of filing of the relevant complete specification (s 65(a)).[33]Relevantly, the extension of term scheme under the Act covers standard patents for pharmaceutical substances per se pursuant to s 70(2)(a), hence patents for pharmaceutical methods or tablets do not fall within the scheme. It can be noted that pharmaceutical substances produced by a process that involves the use of recombinant DNA technology, the subject matter of s 70(2)(b), are not relevant to this case.[34]Alphapharm Pty Ltd v H Lundbeck A/S (2008) 76 IPR 618 at 625-627 [2]-[10]. Citalopram, a racemate, also an invention of Lundbeck's, is the subject of the Citalopram Patent, dated January 1977 (the term of which was originally 16 years from that date[35]). A racemate, or racemic mixture, comprises two enantiomers in equal measure. Enantiomers are non‑superimposable mirror images of each other and are designated (+) or (-) based on how they rotate polarised light. On 9 December 1997, Lundbeck's local subsidiary successfully obtained the inclusion of a pharmaceutical product called CIPRAMIL in the ARTG based on the Citalopram Patent. CIPRAMIL comprises two enantiomers: (+)-citalopram; and the mirror image enantiomer (-)-citalopram. On 16 September 2003, Lundbeck's local subsidiary successfully obtained the inclusion in the ARTG of a second pharmaceutical product, LEXAPRO, based on the Escitalopram Patent, which consisted of (+)-citalopram. In the complete specification of the Escitalopram Patent, it was explained that the isolated enantiomer (+)-citalopram is "therapeutically more active" and "more than 100 times more effective" in treating depression than the racemate[36]. [35]As explained below, until 1995, the term of a patent was 16 years and the increase of the term from 16 to 20 years occurred as a result of Australia's membership of the World Trade Organization and obligations under Art 33 of the Agreement on Trade-Related Aspects of Intellectual Property Rights, which is Annex 1C to the Marrakesh Agreement establishing the World Trade Organization [1995] ATS 8, which entered into force in Australia and generally on 1 January 1995.[36]Alphapharm Pty Ltd v H Lundbeck A/S (2008) 76 IPR 618 at 625 [5], 648 [110].Lundbeck's first application to extend the term

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

CRENNAN, BELL AND GAGELER JJ KIEFEL AND KEANE JJ

Alphapharm's construction of reg 22.11(4)(b) gives the regulation an operation which is inconsistent with one of the principal objects of the extension of term scheme. Taking Lundbeck as an example of a patentee who has made a s 70(1) application during the term of the patent, a regulatory delay of nearly eight and a half years should give rise to a straightforward entitlement to an extension of term of nearly three and a half years[103].[103]From 13 June 2009 to 9 December 2012. Conclusions For the reasons set out above, reg 22.11(4)(b) has the meaning which its text taken as a whole, its syntax and the immediate context support – the only time requirement which is excluded by reg 22.11(4)(b), from the general remedial power to extend time in s 223(2)(a), is the first time requirement in s 71(2). The Tribunal did not err in concluding that s 223(2)(a) conferred power on the Commissioner to extend the second time requirement in s 71(2) from 26 July 1999 to 12 June 2009 and the Full Court did not err in dismissing the appeal from the Tribunal. Orders The appeal should be dismissed with costs. Citalopram belongs to a class of drugs called selective serotonin re-uptake inhibitors, which are used in the treatment of depression. It is a racemate, comprising two different, mirror-image forms of the same chemical compound, called enantiomers. Enantiomers are designated (+) or (-) depending on how they rotate plane-polarised light. The first respondent, H Lundbeck A/S, was the holder of a patent which claimed, inter alia, a (+)‑enantiomer of citalopram called escitalopram ("the patent"). The term of the patent expired on 13 June 2009, but not before the first respondent applied for its extension under s 70(1) of the Patents Act 1990 (Cth) ("the 1990 Act"). Section 70(1) provides:"The patentee of a standard patent may apply to the Commissioner for an extension of the term of the patent if the requirements set out in subsections (2), (3) and (4) are satisfied."Sub-section (2)(a) limits the patents which may be the subject of an application to those whose complete specification, in substance, discloses one or more pharmaceutical substances, and those substances fall within the scope of the claims of that specification. Sub-section (3)(a) requires that goods containing the pharmaceutical substance or substances be included in the Australian Register of Therapeutic Goods ("the ARTG"). Sub-section (4) provides that the term of the patent must not have been previously extended. Section 71(1) provides for the form of an application for extension of the term of a patent. Section 71(2) governs the time for making such an application. It provides:"An application for an extension of the term of a standard patent must be made during the term of the patent and within 6 months after the latest of the following dates:(a)the date the patent was granted;(b)the date of commencement of the first inclusion in the [ARTG] of goods that contain, or consist of, any of the pharmaceutical substances referred to in subsection 70(3);(c)the date of commencement of this section."The period of any extension of term is to be calculated according to s 77(1), but must not exceed five years (s 77(2)).

Ratio Decidendi

Legal Principle Established

Established by: CRENNAN, BELL AND GAGELER JJ, KIEFEL AND KEANE JJ

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