Australia Slips Further Out-of-Step on Pharmaceutical Extensions

On 28 April 2011, the Japanese Supreme Court ruled that a term extension can be allowed for a patent covering a subsequent therapeutic product based on the same active ingredient as a product having an earlier regulatory approval date.  This decision further confirms that the approach taken in Australia is at odds with many of the nation’s major trading partners.

We have written previously about pharmaceutical extensions of term (see Pharmaceutical Extensions and International Inequities).  The basic principle is simple enough – where a patentee experiences delays in its ability to exploit a patent due to the requirements of obtaining regulatory approval (e.g. permission to market a drug for treatment of humans), it may apply for an extension to the normal 20-year patent term as whole or partial compensation for such delays. 

To prevent the patentee from unfairly extending its monopoly, there are restrictions on the grant of an extension of term.  In particular, it is generally the case that an extension is only available on the basis of the first inclusion of a therapeutic product on the relevant register.  Thus a subsequent patent, directed perhaps to some variation, improvement, or new delivery method, might not be eligible for extension if the active ingredient had previously been registered in its own right.

The recent Japanese decision appears to adopt a more lenient approach to such restrictions than is currently the case in Australia, and seems more in line with the US approach.

REVIEW OF THE AUSTRALIAN LAW

In H Lundbeck A/S v Alphapharm Pty Ltd [2009] FCAFC 70, the Full Bench of the Federal Court of Australia took a narrow view of the Australian provisions regarding extensions of term (specifically, section 70 and section 71 of the Patents Act 1990).  In particular, the Act requires that a request for extension of term can be based only upon the ‘first regulatory approval date’ of a ‘pharmaceutical substance’, and the court confirmed that this applies in respect of any relevant substance ‘contained in’ a product that have been given regulatory approval (Lundbeck at [109]-[111]).

This means that once regulatory approval has been granted for a treatment that contains a particular pharmaceutical substance – regardless of whether or not that substance is, or is known to be, an active ingredient – this becomes the only approval that may be used as the basis for an extension of term of any patent having that substance within its scope.

This may be fatal to the prospects of an extension of term being granted on a subsequent patent – even if it covers an improvement in delivery or efficacy of the pharmaceutical substance, and even if the corresponding product required independent approval – because a request for an extension of term must be filed within six months of the original date of regulatory approval.

COMPARISON WITH US LAW

As we reported previously, in the article referenced above, Australian Federal Court in Lundbeck arrived at the opposite conclusion to that of the US Court of Appeals for the Federal Circuit in Ortho-McNeil Pharmaceutical, Inc. v. Lupin Pharmaceuticals, Inc., No. 09-1362 (Fed. Cir. May 10, 2010), in cases with very similar facts.

In Australia, a previous approval covering a mixture of enantiomers of the antidepressant drug citalopram was found to encompass the isolated, and more effective, enantiomer escitalopram.  As a result, an extension of term of the patent covering escitalopram was late, because it should have been filed within six months of the original citalopram approval (which would have been impossible), and not within six months of the subsequent approval of escitalopram.

The US Ortho-McNeil case related to the anti-microbial agent ofloxacin, which also comprises two enantiomers of which one, levofloxacin was ultimately found to be more effective, and was covered by a separate, and later, US patent.  In this almost identical fact situation, the US court concluded that ‘the enantiomer is a different drug product from the racemate ofloxacin, and was subject to regulatory approval before it could be commercially marketed and used’ (slip op. p 7, emphasis added).  Thus the relevant first approval was that relating to the enantiomer, and the extension of term was upheld.

THE JAPANESE CASE

As reported (here – PDF) by Japanese attorneys Asamura Patent Office, Takeda Chemical Industries, Ltd. is the patentee of Japanese patent no. 3,134,187, directed to a particular controlled-release composition containing morphine hydrochloride.  Marketing approval was granted for this product on 30 September 2005.

However, there was also an earlier approval for a liquid formulation containing morphine hydrochloride as the active ingredient, and approved for the same purpose as the later composition, i.e. relieving pain associated with various types of cancers.

The Board of Appeal of the Japan Patent Office (JPO) had rejected Takeda’s application for an extension of term for the controlled-release composition patent, on the grounds that the earlier approval had covered the same active ingredient and same effect, and that the later approval for the controlled release composition was not necessary.

First the IP High Court, and now the Supreme Court, have overturned the Board of Appeal decision.  In particular, the Supreme Court found that the purpose of a patent term extension is to compensate the patentee for the period of time during which the patented invention could not be worked, due to the need to obtain regulatory approval.  The previously approved drug was found not to fall within the scope of the claims of the later patent, and it was therefore considered necessary to obtain a new approval for the controlled-release composition.  The mere fact that the first-approved product contained the same active ingredient as the later product was not sufficient to prevent an extension of term of the later patent.

COMMENT

The Japanese outcome appears similar to the US result, in which the decision turned on the fact that the later approval was for a ‘different drug product’, even though it was clear (at least in hindsight) that the active ingredient in both products was the same.

Under the Australian law, however, the focus of the enquiry is on a ‘pharmaceutical substance per se’ (i.e. by itself) that falls within the scope of the claims of the patent, and on the date of first regulatory approval of a product containing that substance.

It therefore appears that once a product containing a particular active ingredient has been granted regulatory approval in Australia, it will not be possible for a later approval of  any improved product containing the same active ingredient to form the basis for an extension of term of a corresponding later patent.

As we noted in our earlier article, the Australian High Court denied leave to appeal the Federal Court decision in Lundbeck, and therefore any action to bring Australia’s law back into line with major trading partners, including the US and Japan, will most likely require legislative change.

Tags: Australia, Extension of patent term, Japan, Pharmaceuticals, US