Sandoz Pty Ltd v H. Lundbeck A/S

Sandoz Pty Ltd (Sandoz) appealed against a decision of the primary judge who found that Sandoz did not have a licence to exploit the patent owned by H. Lundbeck A/S (Lundbeck). The dispute arose out of a settlement agreement between Sandoz and Lundbeck that compromised patent proceedings between Lundbeck and other parties. The court was required to decide whether the settlement agreement granted Sandoz a licence to exploit the patent prior to its expiry and whether this licence continued to apply after the patent expired but before the term was extended. The court also had to determine if the settlement agreement provided Sandoz with a defence to infringement proceedings. Furthermore, the court had to consider if the patent, which was extended after having previously expired, qualified as a patent that had "ceased" and was later "restored" within the meaning of the Act. Finally, the court had to examine if the settlement agreement varied the deed of agreement appointing the subsidiary exclusive licensee of the patent.

The court found that the settlement agreement did grant Sandoz a licence to exploit the patent prior to its expiry, and this licence continued to apply in relation to acts occurring after the patent expired but before the term was extended. The court rejected the notion that the settlement agreement produced a commercially nonsensical result and held that it provided Sandoz with a defence to infringement proceedings. The court also found that the patent did qualify as a patent that had "ceased" and was later "restored" within the meaning of the Act, and thus s 223(10)(b) of the Act provided Sandoz with a defence to infringement proceedings. Finally, the court held that the settlement agreement did not deprive the subsidiary of its status under the deed of agreement as the exclusive licensee.

The appeal was allowed, the cross-appeal was dismissed, and the orders made by the primary judge were set aside. The question of what costs orders should be made in the proceeding was to be determined on the papers following receipt of written submissions filed in accordance with orders made in NSD 22 of 2019.