AstraZeneca successfully protects Crestor patents against generic attack in the Australian pharmaceu
Three Justices of the Federal Court of Australia have now on three separate occasions restrained Apotex’s proposed launch of generic versions of AstraZeneca’s cholesterol reducing statin, “Crestor”1 in Australia.
The decisions demonstrate the importance of monitoring the conduct of competitors within the Australian pharmaceutical industry, and also indicate that manufacturers of generic versions of pharmaceutical products may have difficulty entering the market in Australia if the originator has Australian patent protection and a PBS listing relating to its product.
Round One: Apotex’s application for revocation and AstraZeneca’s application for interlocutory relief
Apotex Pty Ltd v AstraZeneca AB  FCA 1520
Apotex’s action for revocation of one of AstraZeneca’s Crestor patents
AstraZeneca is the owner of three Australian patents broadly relating to its cholesterol lowering drug, “Crestor” (rosuvastatin). In May last year, Apotex, wishing to pursue the launch of generic versions of rosuvastatin, commenced proceedings in the Federal Court of Australia to revoke one of these patents.
Apotex’s launch of generic versions of Crestor in Australia
In response to Apotex’s revocation application, between July and October last year, Astra corresponded with Apotex in an attempt to ascertain whether Apotex was planning to launch a generic version of Crestor during the term of the Crestor patents. During this time Apotex did not deny that it was contemplating the launch of generic versions of Crestor in Australia.
However, by November 2011, Apotex had taken clear and definite steps to launch its generic products. In connection with this launch, Apotex:
- obtained Therapeutic Goods Administration (TGA) registrations for various generic versions of Crestor;
- applied to have its generic products listed on the Pharmaceutical Benefits Scheme (PBS); and
- launched an intense marketing campaign advising pharmacists of the availability of its generic products, and offering discounts in the order of 75% off the price charged by AstraZeneca for Crestor.
AstraZeneca’s application for an interlocutory injunction
After obtaining further information relating to the composition of Apotex’s generic products and its approved therapeutic indications, on 7 December 2011 AstraZeneca applied to the Federal Court for an interlocutory injunction to stop Apotex from pursuing the launch of its generic products.
In support of its application, AstraZeneca relied upon:
- its dosage patent – which generally relates to the administration of a single, once daily oral dose of 5 to 10 mg of rosuvastatin;
- its composition patent – which relates to the composition of the tablet in which the active ingredient, rosuvastatin is delivered; and
- its genetic patent that relates to the use of rosuvastatin to treat heterozygous familial hypercholesterolemia (a genetic disorder resulting in high cholesterol levels).
AstraZeneca’s interlocutory application was heard by Justice Rares on 14 December 2011.
Entitlement to interlocutory relief
Justice Rares considered that AstraZeneca was entitled to interlocutory relief as:
- It had a prima facie case of patent infringement: Based upon AstraZeneca’s expert evidence, coupled with Apotex’s failure to adduce any meaningful invalidity evidence, Justice Rares held that AstraZeneca had made out a prima facie case; and
- The balance of convenience favoured the grant of interlocutory relief because:
- Apotex’s competition would inevitably force AstraZeneca to reduce the price of Crestor;
- Pursuant to the PBS price reduction scheme, Crestor’s approved PBS price to pharmacists would be permanently reduced to match Crestor’s actual reduced market price.
- If AstraZeneca was to be successful at the final hearing of the dispute, and Apotex was forced to withdraw its generic products from the market, AstraZeneca would have difficulty returning to prices it charged before Apotex’s entry into the market, and would thereby suffer irreparable harm;
- Apotex sought to enter the market with full knowledge of AstraZeneca’s patents, which are long standing, and which it had previously unsuccessfully sought to have re-examined by the Australian Patents Office.
- Apotex failed to “clear the way” by seeking revocation of AstraZeneca’s patents or seek a declaration of non-infringement prior to engaging in a damaging marketing campaign. Rather, ‘Apotex engaged in a carefully orchestrated marketing exercise designed to catch AstraZeneca by surprise’.
- AstraZeneca has a substantial existing market in Crestor, whereas Apotex has no established position in the market.
- These factors outweighed any losses to market share and marketing expenditure that Apotex may have suffered as a result of the grant of an injunction.
Justice Rares’ decision to stop Apotex entering the market
Accordingly, on 14 December 2011, Justice Rares ordered Apotex be restrained until further order from selling, supplying, offering to sell or supply, soliciting or taking orders for, or advertising or promoting its generic products.
Similar restraining orders made against other generics
On similar bases, Justice Jagot also considered that Apotex was entitled to enjoin Watson Pharmaceuticals and Ascent Pharmaceuticals from launching their generic versions of Crestor in Watson Pharma Pty Ltd v AstraZeneca AB  FCA 200.
Round 2: Apotex’s first application for variation of the terms of the injunction
Apotex Pty Ltd v AstraZeneca AB (No 2)  FCA 142
On 20 January 2012, Apotex applied for orders that the terms of Justice Rares’ orders be varied so as to limit their restraint to products that infringed the dosage patent – i.e. Apotex’s 5mg and 10mg generic products, in circumstances where it had undertaken not to sell products that fell within the scope of the claims of the dosage patent.
Apotex’s first application for variation was heard before Justice Emmett. Justice Emmett refused the application, principally because Apotex could not point to additional evidence that was available that would justify a conclusion different to that reached by Justice Rares.
Round 3: Apotex’s second application for variation of the terms of the injunction
Apotex Pty Ltd v AstraZeneca AB (No 3)  FCA 265
As a result of Justice Rares and Emmett’s decisions, Apotex decided to change the formulation of its generic products in an attempt to remove the basis for the allegation of infringement of the composition patent. Apotex contended that this change, together with its undertaking not to sell dosages of the generic product that fell within the scope of the dosage patent meant that that the strength of AstraZeneca’s case for interlocutory relief had fundamentally changed.
In response, AstraZeneca acknowledged that Apotex’s new composition was unlikely to infringe the composition patent, but maintained that Apotex’s products would infringe the dosage and genetic patents.
Apotex’s second application for variation was heard by Justice Jagot.
Justice Jagot criticised Apotex’s conduct
Justice Jagot criticised Apotex’s conduct in the proceedings, explaining:
Apotex knew the basis upon which it had been restrained on 14 December 2011 [by Justice Rares] included the arguable presence of a salt in its coating. Apotex chose to apply to have those orders set aside before Emmett J on 31 January and 6 February and argued again that its product did not infringe the [composition] patent by reason of its coating. In making this further application after it failed before Emmett J, it would be expected that Apotex would provide a proper evidentiary foundation for the exercise of discretion it now seeks in its favour.
Contrary to Justice Jagot’s observations, Apotex did not “provide a full and frank explanation of the timing of the various steps it had taken to reach its current position, including disclosing when it first considered the possibility of reformulating its product…”. Without such evidence, Justice Jagot drew the inference that Apotex could have raised the fact that it was at least considering reformulating its products to avoid the composition patent during its first variation application before Justice Emmett, and considered that Apotex should have done so.
In any event, Justice Jagot considered that Astra remained able to demonstrate a prima facie case based upon the dosage and genetic patents.
Doctors, pharmacists and patients are not always obedient!
In relation to the dosage patent, Justice Jagot explained that despite Apotex’s undertakings not to sell dosages of generic products that fell within the scope of the dosage patent, the price differential between Apotex’s and AstraZeneca’s products meant that there was a strong price incentive for customers to “split” other dosage forms of the Apotex generic products to produce tablets with a dosage that fell within the scope of the dosage patent. To combat the risk of tablet splitting, Apotex undertook to send letters to doctors and pharmacists advising them that tablet splitting was prohibited. Justice Jagot considered that these measures were not likely to deter consumers from splitting the tablets in circumstances where:
- consumers knew that the splitting would not affect the safety and efficacy of the drug; and
- there was a strong price incentive to engage in tablet splitting.
In relation to the genetic patent, Justice Jagot considered that the instructions issued to doctors and pharmacists to not use the generic product to treat heterozygous familial hypercholesterolemia was not “practical or likely to be efficacious”, especially in circumstances where medical practitioners knew that there was no therapeutic efficacy or safety issue in prescribing Apotex’s generic product to treat the genetic disorder. In this regard, Justice Jagot explained:
It is obvious that Apotex’s generic product will be equally capable of treating heterozygous familial hypercholesterolemia as AstraZeneca’s product, Crestor. Apotex’s entire scheme of proposed instructions to doctors, pharmacists and patients is founded on the apparent but in evidentiary terms unsupported belief that doctors, pharmacists and patients will be willing to overlook the scientific reality…
Lessons for originator pharmaceutical companies
The series of decisions demonstrate that:
- It may be difficult for generics to enter a market in which the originator has patent protection and is listed on the PBS .2
- It is important for originator pharmaceutical companies to monitor the activities of generics and take action as soon as they are presented with an imminent threat of infringement (e.g. by monitoring ARTG registrations).
- As soon as originators are aware that a generic is contemplating entry into the market, it is important that an enforcement strategy be developed, and steps are taken to build evidence to support assertions of infringement and in favour of the balance of convenience (including evidence of irreparable harm).
The three decisions also helpfully discuss the relevance of product information documents and other instructional materials in assessing the likelihood of infringement of method, manner of administration and process pharmaceutical patents in Australia.
- “Crestor” is an Australian registered trade mark (no. 818594).
- See also Pharma patent litigation in Australia: Pharma patent litigation in Australia – good news for originators