In a majority decision handed down on 5 November 2014, the High Court of Australia has ruled that an extension of time is available for the purpose of requesting an extension of term of a patent.¹ In handing down this decision the High Court upheld a decision made last year by the Full Federal Court,² concerning Lundbeck’s right to extend the term of its patent for the anti-depressant drug, Escitalopram (Lexpro™).
Brief History of the case
The original decision to grant an extension of time of nearly 10 years was made by a delegate of the Commissioner of Patents and affirmed by the Administrative Appeals Tribunal (AAT) and the Full Federal Court. Both the AAT and the Full Federal Court held that the Australian Patents Act (Cth) 1990 (the Act) gave the Commissioner the power to grant the extension of time to Lundbeck for the purpose of an extension of term application. It was argued by Alphapharm that such a decision is only able to be made where there is a ‘relevant act’ and, in the present case, there was no such relevant act.
In its application for special leave to appeal to the High Court, Alphapharm argued that the extension of time provisions of the Act did not apply in relation to certain prescribed actions, one of which was the filing of an extension of term application. It also argued that it was not ‘reasonable’ for Lundbeck to be granted such a lengthy extension of time in which to file its application to extend the term of the patent.
The High Court appeal ³ was limited to the question of whether an extension of time is available under the provisions of the Act and associated regulations for the purpose of filing an extension of term application. The court declined to hear the question as to whether it was ‘reasonable’ for Lundbeck to be granted such a lengthy extension of time, presumably because it was felt that the Administrative Appeals Tribunal had correctly weighed up all of the relevant factors in granting the 10 year extension.
High Court Decision
In a split decision, the majority of the High Court dismissed the appeal. It was held, by majority, that there were two time requirements under the extension of term provisions. The first was that an extension of term application be made during the term of the patent and the second was that the application be made within six months of the latest of three dates specified in the Act: the date of grant of the patent; the date of commencement of the first inclusion of the pharmaceutical substance in the Australian Register of Therapeutic Goods; and the date of commencement of the section of the Act. The Court found that the extension of time provisions permitted the Commissioner to allow an extension of term application to be made during the term of the patent, but more than six months after the latest of the three specified dates.
Interestingly, the bench of the High Court was divided on this issue. Crennan, Bell and Gagler JJ (the majority decision) stated at  that:
‘There is nothing in any of the extrinsic materials, or in the long policy debates on simplifying extensions of term, which would suggest any rationale for excluding the second time requirement from the remedial power to extend time under s 223(2)(a). …….Alphapharm’s construction would introduce an inexplicable asymmetry between a patentee and a competitor opposing a s 70(1) application. An opponent can access the general remedial power to extend times cast upon it in mandatory terms. Had it been the legislature’s intention to exclude the second time requirement in s 71(2) from the general remedial power in s 223(2)(a), that would have been simple to accomplish.’
The dissenting Judges, Kiefel and Keane, were of the opinion that Alphapharm’s appeal should be allowed and the decisions of the Full Court of the Federal Court, the AAT and the Delegate of the Commissioner be set aside, refusing Lundbeck’s application for an extension of time. Kiefel and Keane at  stated:
‘The approaches of the AAT, the Full Court and the first respondent treat s 223(2) as permitting the enlargement of a time specified for the doing of an act, such as the time requirements found in s 71(2). However, s 223(2) does not contain such a power and does not operate in this way. It provides a power to permit the doing of an act which would otherwise be done outside the requirements as to time.’
Kiefel and Keane further explain at  that:
‘Too much weight is given by the first respondent to the additional words appearing in reg 22.11(4)(b). Their obvious purpose is to identify the requirements of s 71(2) as relevant to the action of filing an application under s 70(1). These additional words cannot alter the effect of the operative part of the regulation, which must identify the “relevant act” which is excepted from the operation of s 223(2). Even if it did no more, the Explanatory Statement for the 1998 Amendment Regulations at least identified the action which the predecessor to reg 22.11(4)(b) prescribed – and, to that extent, confirmed its meaning’
In the absence of the extension of term, the Escitalopram patent would have expired on 13 June 2009. In light of this much anticipated decision, the patent will have an expiry date of 9 December 2012, if the extension of term is now granted. While this extended term has also expired, a number of generic manufacturers who were marketing generic Escitalopram in the intervening period may be impacted by the decision. The generic pharmaceutical industry will also have less certainty as to whether an application for extension of the term of a patent might be made by a patentee after the time limits specified in the Act have expired.
If you have any specific enquiries about the Escitalopram case in Australia, please contact Paul Jones or Debra Tulloch.
This article was written by Dr Rosemary Manhire-Heath and Dr Ellen Reid.
- Alphapharm Pty Ltd v H Lundbeck A/S  HCA 42
- Aspen Pharma Pty Ltd v H Lundbeck A/S  FCAFC 129
- Alphapharm Pty Ltd v H Lundbeck A/S & Ors  HCATrans 79