An extended sigh of relief for Lundbeck – High Court holds that failure to make a timely application

An extended sigh of relief for Lundbeck – High Court holds that failure to make a timely application

An extended sigh of relief for Lundbeck – High Court holds that failure to make a timely application

Alphapharm Pty Ltd v H Lundbeck A-S [2014] HCA 42

The long running battle in relation to Lundbeck’s LEXAPRO has finally reached an end with the High Court’s majority (3:2) finding that remedial section 223(2) of the Australian Patents Act 1990 does confer the power on the Commissioner of Patents to extend the time for making an application under section 70(1) for an extension of term of a pharmaceutical patent.

The LEXAPRO saga

Escitalopram is the (+)-isomer of racemic citalopram; escitalopram and citalopram being the respective active agents in the anti-depressant drugs LEXAPRO and CIPRAMIL.  Both LEXAPRO and CIPRAMIL were included in the Australian Register of Therapeutic Goods (ARTG), with CIPRAMIL registered on 9 December 1997, and LEXAPRO on 16 September 2003.   Escitalopram is therapeutically more effective than citalopram in treating depression and is the subject of Australian Patent No 623144. 

The Patents Act allows for extensions of term for pharmaceutical patents to compensate for delays in obtaining regulatory market approval.  Section 71(2) prescribes two relevant time requirements for making an application for an extension: (i) the application must be made during the term of the patent; and (ii) the application must be made by the later of 6 months from the date the patent was granted, or 6 months from the date of inclusion in the ARTG.  Accordingly, Lundbeck made an application for an extension of the ‘144 patent on 22 December 2003, based on the ARTG inclusion date of LEXAPRO.

In 2009, the Full Federal Court effectively held that while the (+)-designation used in the claims of the ‘144 patent referred to the separated or isolated isomer, this construction did not extend to the determination of the first goods consisting of or containing escitalopram included in the ARTG, and unanimously found that the first listing in the ARTG of goods which contain the (+)-enantiomer escitalopram was the listing of CIPRAMIL, containing the racemate.  The effect was that Lundbeck’s 2003 application for extension of the ‘144 patent did not satisfy the second temporal requirement of section 71(2). 

However, the Patents Act also contains remedial provisions under section 223(2) which allow for the Commissioner to extend the time for doing a relevant act required to be done within a certain time, where the failure to do the act was due to an error or omission by the person concerned, or his or her agent or attorney.  In view of the Full Federal Court’s finding, on the day before the ‘144 patent’s 20 year term was to expire, Lundbeck made a second application to extend the patent term, this time based on the ARTG inclusion date of CIPRAMIL, coupled with an application under section 223(2) for an extension of time of 121 months, so as to meet the second temporal requirement of section 71(2).

The Commissioner’s delegate awarded the extension of time, finding that the original deadline for making the application was missed due to a genuine misunderstanding of the law on the part of the patentee and that this constituted an “error or omission” for the purpose for section 223.

Alphapharm, who following the expiration of the 20 year term of the ‘114 patent had  launched their own generic version of escitalopram, appealed the decision of the Commissioner to the Administrative Appeals Tribunal (AAT) where it was upheld, and then subsequently appealed the AAT decision to the Full Federal Court, where it was also upheld.  Alphapharm then sought and obtained leave to appeal the decision to the High Court.

The High Court considers what is a “relevant act”?

The issue considered by the High Court came down to the question of what is a “relevant act” contemplated by remedial section 223(2)?  This was determined by reference to regulation 22.11, which expressly excludes certain acts (“prescribed acts”) from remedy by section 223.  Regulation 22.11 4(b) specifically recites the act of “filing, during the term of a standard patent as required by subsection 71(2) of the Act, an application under subsection 70(1) of the Act for an extension of the term of the patent”. 

Alphapharm put forward the proposition that the act excluded by regulation 22.11 4(b) encompassed both temporal requirements of subsection 71(2), that is to say, regulation 22.11 4(b) is to be read up to “filing an application under subsection 70(1)” and that failure to meet the second temporal requirement of subsection 71(2) cannot be remedied by section 223(2).  Lundbeck argued that regulation 22.11 4(b) only contemplated the first temporal requirement of section 71(2), “during the term of a standard patent”, with the effect that there is no remedy under section 223(2) for an application to extend a patent made after the term of the patent has expired but that section 223(2) could remedy a failure to meet the second time requirement.

Justices Crennan, Bell and Gageler examined the legislative history of pharmaceutical patent extensions as well as that of section 223 and regulation 22.11 4(b), and noted the distinct rationale behind each of the two time requirements of section 71(2); the need to avoid uncertainty to the public if there were a gap between the expiration of a patent and the presentation of an application to extend its term; and requiring the patentee to make a decision about extending its monopoly as soon as the requisite conditions were in place.  Their Honours found nothing which would suggest a rationale for excluding the second time requirement from the remedial power of section 223(2).

In light of this, Alphapharm’s proposition was rejected on the basis that the text, syntax and immediate context of regulation 22.11 4(b) meant that the only time requirement excluded by it is the first requirement of section 71(2). 

Remedies still available for errors or omissions made by pharmaceutical patentees

The decision means that, provided that the original 20 year patent term has not expired, where the second timing requirement for making an application for an extension of term is missed because of a genuine error or omission, the remedial operation of section 223 can still apply.  This decision will come as a great comfort to the innovative pharmaceutical industry in view of the enormous value that may be associated with extensions of term of patents covering pharmaceutical products registered on the ARTG, which could be jeopardised as a result of procedural errors in processing extension of term applications if the remedial provisions were not available.