Australian pharmaceutical patent term extensions – Full Federal Court reigns in the scope of allowable extensions in 2 recent decisions

Under the Patents Act 1990 (Cth) (Act) such extensions of term are only available for patents in respect of a “pharmaceutical substances per se” (new and inventive substances.

Importantly, eligibility for an extension is strictly regulated by requirements including that an application can only be made if the period between the date of filing of the patent and regulatory approval is at least 5 years.  If the patent is eligible for an extension, the extension is the difference between the date of the patent and the “earliest first regulatory approval date in relation to any of the pharmaceutical substances” less 5 years.

Numerous cases have considered the meaning of the term “pharmaceutical substance per se”, and these two recent decisions of the Federal Court grapple with the identification of the actual “first regulatory approval date” of a pharmaceutical substance.

While in practice the patentee provides the details of the registration of its reference product for this purpose, these two recent cases open up a relevant enquiry as to whether a different and earlier registered product can scuttle the patentee’s request for an extension of term. Specifically, where the patent discloses and claims more than one pharmaceutical substance per se that are each the subject of ARTG listings, the application of the regime has been controversial. 

Two recent decisions of single judges of the Federal Court considered the provisions of the extension of term regime in these circumstances.  We reported on these decisions in Ono and MSD v Sandoz here and here.  Both decisions were appealed.

On 18 March 2022, the Full Court handed down its highly anticipated appeal decisions, striking down the extensions of term in both cases on the basis that the reference product relied upon for the extension was not the correct one. 

Together the decisions provide substantial guidance on the operation of the patent term extension regime provided by the Act where there is more than one pharmaceutical substance per se disclosed and claimed in the patent that are each the subject of ARTG listings.

Key takeaways

The Full Court decisions clarify for patentees (or third parties looking to challenge a patent term extension) that:

• a patentee cannot elect which reference product/ARTG listing for the purposes of the regime;
• relevant ARTG listings for the purposes of the extension of term provisions include third party ARTG listings for goods that contain substances that are disclosed in the patent, and fall within the scope of the claims;
• in terms of the calculation of the extension of term in accordance with section 77 of the Act, where more than one pharmaceutical substance per se is disclosed and claimed in the relevant patent, and there are multiple regulatory approvals, the length of the extension is calculated by reference to the first inclusion on the ARTG of any of those substances.

The facts

In Ono, the patentee had sought to rely on its ARTG listing (Opdivo) as the basis for seeking an extension of term.  There was no contest that goods listed on the ARTG with an earlier approval date (Keytruda) also contained a pharmaceutical substance that was disclosed and claimed in the patent the subject of the extension application .  The primary judge found that Ono was entitled to choose the ARTG listing for the purpose of its extension application, in this case Opdivo.  This decision was overturned on appeal. 

In MSD, the earlier filed ARTG listing belonged to the patentee (for sitagliptin), but the patentee sought to have the extension of term calculated on a later ARTG listing (for a sitagliptin/metformin product).  While the application for an extension could be made on the basis of sitagliptin/metformin, her Honour held that the calculation of the extension of term is by reference to the first inclusion on the ARTG – ie. sitagliptin – and on the basis of sitagliptin, the extension of term was zero.  The primary judge in this case sought to distinguish the Ono decision on the basis that it involved a third party registration.  The primary judge’s ruling was upheld on appeal and the appeal dismissed.

The statutory regime, and the Full Court’s decisions

The statutory regime sets out various “conditions” in section 70(2) and (3) of the Act which need to be met for a patentee to apply for an extension of term, including:

1. One or more pharmaceutical substances per se (or one or pharmaceutical substances when produced by a process that involves the use of recombinant DNA technology) must in substance be disclosed in the complete specification, and in substance fall within the scope of a claim of the patent (section 70(2)). 
2. That goods containing or consisting of the substance are included in the ARTG, and the period beginning on the date of the patent and ending on the “first regulatory approval” for that substance is at least 5 years (section 70(3)).

There are also timing requirements for the application for a patent term extension set out in s 71.

The length of the extension granted is equal to the difference between the date of the patent and the “earliest first regulatory approval date in relation to any of the pharmaceutical substances” less 5 years (such that if the period between the date of the patent and the ARTG listing date is 5 years, any extension is zero) (section 77(1)).

The Full Court, comprising Allsop CJ, Yates J and Burley J in both appeals, referred to the policy objectives of the extension of term regime – which seeks to strike a balance between the competing interests of a patentee of a pharmaceutical substance whose exploitation monopoly has been delayed, and the public interest in unrestricted use of the invention – and to the principles of statutory interpretation. 

In the Ono appeal decision, the Full Court found that the primary judge fell into error in finding that this regime facilitated a choice in terms of ARTG listing that was relied on for the patent term extension.  In construing the words of the Act strictly, the court found that “The primary judge’s reasoning – which implies the notion of choice and the notion that s 70(3) is concerned only with “the patentee’s goods” – reduces the scope of s 70(3) to a more limited subset of goods than is provided for by the actual words of the provision.  There is no warrant in the statutory language, or in the context provided by the other provisions… of the regime, for reducing the scope of section 70(3) in that way”. 

The Full Court’s decision is one which points to the legislature to change this outcome if that is the policy objective: “If, in its operation , that regime has not achieved, and is not achieving its intended policy objectives, or is providing for difficulty for patentees in its application, then it is for the legislature to drive the outcomes it seeks by undertaking the necessary legislative changes” .

In relation to the calculation of the extension of term, the Full Court agreed with the primary judge’s reasons in the MSD case that the calculation provisions in section 77 takes into account the “earliest” first regulatory approval date of any of the pharmaceutical substances disclosed and claimed in the relevant patent referred to in section 70(2).  “There is no policy reason to divert from the language of s 77(1) in determining the term of the extension”, it said.

In terms of the policy considerations in the case of MSD, the Full Court gave the example that MSD had already able to exploit its monopoly in respect of sitagliptin since 2006, when that product was included on the ARTG, and it could not have sought an extension of term of the patent under the regime based on that ARTG listing as regulatory delay was less than 5 years from the date of the filing of the patent.  It was only when the sitagliptin/metformin product was listed on the ARTG that MSD became eligible (under section 70(3)) to apply for an extension of term.  However, the Full Court said “the effect of the extension would be to extend the monopoly rights under the patent not only for the composition sitagliptin/metformin, but also for sitagliptin and indeed any other pharmaceutical substance disclosed and claimed in the patent”.   It is clear that this is not the intention of the regime.

The Full Court’s decisions confirm the position of the Commissioner of Patents - that extensions of term applications require consideration of the first ARTG listing of any product that falls within the claims of the relevant patent – even if this product is a third party ARTG listing.

Despite the Commissioner’s view being affirmed by the Federal Court, as the Ono and MSD decisions demonstrate, there are a series of patents whose terms have been extended when they should not have been under the regime.

We note that in Bayer Pharma Aktiengesellschaft [2022] APO 7, the Commissioner also found the extension of term is a wrong entry, and that the Register should be amended to indicate that the patent expired in August 2020.  While this decision had been appealed, we anticipate the Commissioner of Patents will proceed to rectify the Register to reverse the extension of this patent.