Decision to refuse preliminary discovery overturned on appeal

In an appeal from a single judge of the Australian Federal court, Pfizer Ireland Pharmaceuticals (Pfizer) has succeeded in obtaining preliminary discovery regarding a process of manufacture undertaken by Samsung Bioepis AU (Samsung Bioepis). The process in question was to produce a biosimilar of the biological medicine Enbrel (Pfizer), which comprises the activate ingredient Etanercept. Enbrel is used in the treatment of autoimmune diseases, such as rheumatoid arthritis, juvenile rheumatoid arthritis and psoriatic arthritis.

The three patents of concern for Pfizer (AU2005280034, AU2005280036 and AU2008242632) are not specifically directed to Etanercept, but rather to a general production processes for proteins and polypeptides. At first instance, Burley J found the application to obtain preliminary discovery to be unfounded. In particular, the primary judge determined that, due to a lack of evidence filed by Pfizer, the expert opinion was unable to confirm whether there were sufficient grounds to establish a belief that the process undertaken by Samsung Bioepis would infringe one or all of the Pfizer patents. On this basis the application was dismissed.

On appeal to the Full Federal Court, it was found that the primary judge erred in his approach. As outlined by Allsop CJ:

‘The relevant question posed by the rule is whether the applicant reasonably believes that it may have the right to obtain relief. It is not whether one scientific view is more or less persuasive than another….. If the applicant has a belief that is founded on considerations or views reasonably open (even if contested as incorrect by others) that may well found a conclusion that the applicant has a relevant reasonable belief.’

Pfizer argued that the available evidence lead to the belief that Enbrel and the Samsung Bioepis product, Brenzys, may be produced by the same process. This assertion relied on the fact that the two products exhibit a similar glycosylation profile. This is a likely result of a similar key step in the process of production. Furthermore, Pfizer’s expert witness held the view that the process undertaken by Pfizer to produce Enbrel was in accordance with the Pfizer patents (‘034, ‘036, ‘632). In reply, Samsung Bioepis argued that the similarity in glycosylation profiles was insufficient to give reasonable belief that the two products originated from the same process of production.

On this basis, the Full Federal Court held that there were reasonable grounds, based on the information available, for Pfizer to believe they may be entitled to relief.

In establishing this finding, the Court acknowledged that confusion had arisen in determining entitlement to obtain preliminary discovery. This confusion arose from the application of a test which required a right to obtain relief to be shown; rather than the possibility that one may exist, as is required under the Federal Court Rules. Furthermore, the Court outlined a series of steps which should be adopted in future decisions involving applications for obtaining preliminary discovery:

(i) the prospective applicant must prove that it has a belief that it may (not does) have a right to relief;
(ii) it must demonstrate that the belief is reasonable, either by reference to material known to the person holding the belief or by other material subsequently placed before the Court;
(iii) the person deposing to the belief need not give evidence of the belief a second time to the extent that additional material is placed before the Court on the issue of the reasonableness of the belief. That belief may be inferred;
(iv) the question of whether the belief is reasonable requires one to ask whether a person apprised of all of the material before the person holding the belief (or subsequently the Court) could reasonably believe that they may have a right to obtain relief; and
(v) it is useful to ask whether the material inclines the mind to that proposition but very important to keep at the forefront of the inclining mind the subjunctive nature of the proposition. One may believe that a person may have a case on certain material without one’s mind being in any way inclined to the notion that they do have such a case.’

As a result of this decision, it is now clear that successfully resisting an application for preliminary discovery will require a respondent to focus on discrediting the belief resulting from the available evidence; rather than contesting the evidence or expert opinion upon which this belief is based.

In summary, the appeal by Pfizer was granted and Samsung Bioepis was ordered to give Pfizer preliminary discovery. The particulars of the information to be disclosed, along with any questions of confidentiality, are to be the subject of further orders.

Finally, an application for leave to appeal this decision must be made by 27 December 2017. This appeal would be to Australia’s highest court, the High Court, and Samsung Bioepis would require special leave of that court in order to appeal.

1. Pfizer Ireland Pharmaceuticals v Samsung Bioepis AU Pty Ltd [2017] FCA 285
2. Pfizer Ireland Pharmaceuticals v Samsung Bioepis AU Pty Ltd [2017] FCAFC 193 [69]
3. Ibid [22-23]
4. Ibid [118-119]
5. Ibid [120]
6. Ibid [121]

This article was written by Dr Benjamin Cleary.

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