Patent term extensions under fire 9 min read
In the fight against patent infringement, challenging the validity of patent term extensions (PTEs) is increasingly becoming the weapon of choice for generic pharmaceutical companies. Most recently, the weapon was deployed in Biogen International GmbH v Pharmacor Pty Ltd [2021] FCA 1591, when Pharmacor successfully defended an application by Biogen for an interlocutory injunction. Since around the mid-2000s, patentees in pharmaceutical patent cases have typically been successful in bids for interlocutory injunctions, aiming to prevent the launch of generic products in Australia.
The recent Biogen decision by the Federal Court is the latest in a trend of refusing interlocutory injunctions, and a clear indication the tide is turning.
Key takeaways
- Challenging the validity of patent term extensions is a powerful tool for generic pharmaceutical companies to avoid infringement liability.
- It cannot be assumed a claim in the form '[pharmaceutical substance] for the therapy of [condition X]' is directed to a pharmaceutical substance per se and therefore eligible for PTE. Only context, including consideration of other claims, will determine whether a patent claim is construed as purpose-limited or specifically protects a pharmaceutical substance.
- Patentees should carefully consider their patent strategy and product portfolio, ensuring any applications for PTE are based on the appropriate product and not vulnerable to challenge.
Biogen attempts to stop Pharmacor launch
Biogen International GmBH (Biogen) holds an Australian patent titled 'Utilisation of dialkyl fumarates' (the Patent). Broadly, the Patent is directed to pharmaceutical preparations consisting of dimethyl fumarate (DMF) for use in transplantation medicine or the therapy of autoimmune diseases.
In Australia, a pharmaceutical patent may circumstantially be eligible for a PTE of up to five years. In 2014, Biogen successfully applied for a PTE, extending the Patent’s expiry date from 29 October 2019 to 29 October 2024.
Biogen commenced final relief proceedings to restrain Pharmacor Pty Ltd (Pharmacor) from launching its DMF products (Pharmacor Products), alleging the launch would constitute patent infringement under the Patents Act 1990 (Cth).
Biogen sells DMF formulations in Australia for the treatment of multiple sclerosis under the brand name Tecfidera, a prescription-only medicine listed on the Pharmaceutical Benefits Scheme (PBS). In addition to Tecfidera, Biogen applied to list a second fumarate product, Vumerity, on the Australian Register of Therapeutic Goods (ARTG), with plans to launch it as a similar treatment for relapsing multiple sclerosis.
Pharmacor obtained listings for the Pharmacor Products on the ARTG and also applied for PBS listing, seeking an effective listing date of 1 December 2021. Biogen countered with an urgent interlocutory injunction to restrain Pharmacor from marketing and offering the Pharmacor Products.
When assessing whether to grant injunctive relief, the Court considers whether:
- there is a prima facie case for infringement; and
- the 'balance of convenience' favours the grant of an injunction.
'Doubtful' PTE demolishes prima facie case
Although Biogen established a clear prima facie case that the Pharmacor Products fell within each of the asserted claims, this did not lead to the conclusion that it had established a prima facie case of infringement. Importantly, the Court determined at a provisional level that there was 'a sufficiently strong prospect that the extension of the Patent may have been wrongly granted', and this was sufficient to qualify Biogen's prima facie case of infringement. The Court said this conclusion alone was likely to be enough to justify the refusal of injunctive relief.
A threshold requirement for PTE eligibility is that the patent must relate to a pharmaceutical substance per se. The pharmaceutical substance must be disclosed in the specification and fall within the scope of at least one claim. The Federal Court has previously held a pharmaceutical substance specified as part of a 'method of treatment', or 'Swiss-style' claim, does not satisfy this requirement.
In the request for PTE, Biogen stated that the relevant pharmaceutical substance – enteric-coated micro-tablets of dimethyl fumarate (Tecfidera) – fell within the scope of at least claims 13 to 17 of the Patent. Claim 13 is for 'A pharmaceutical preparation in the form of micro-tablets or micro-pellets consisting of one or more dialkyl fumarates… for use in transplantation medicine or for the therapy of autoimmune diseases…'.
The Australian Patent Office has generally considered claims in the form 'substance X for use in the treatment of disease Y' (referred to as 'EPC 2000' claims) are not purpose-limited. Rather, terms like 'for', 'for use in', 'used to', and 'used for' are considered to limit what is claimed, but only to the extent it is 'suitable for' the specified purpose (rather than confined to that specified purpose). Accordingly, such claims are considered equivalent to a claim to the substance per se (ie, a product claim). When a second medical use is being claimed in this form, the claim will be rejected on novelty or inventive step grounds as the substance is already known. In contrast, in Europe, EPC 2000 claims are purpose-limited product claims and can be used to protect new therapeutic uses of known substances.
Pharmacor challenged the validity of Biogen's PTE, arguing claim 13 is essentially an EPC 2000 claim and, properly construed, 'a purpose limited product claim in that it claims an actual achievement of a therapeutic act being a functional technical feature of the claim'. Pharmacor contended the limiting effect of the words 'for use' in the claims was an attempt to confer novelty and inventiveness over DMFs. The claims were not product claims for a pharmaceutical substance.
On the other hand, Biogen argued claims to products 'for use' in certain therapeutic contexts are conventionally construed as product per se claims, referring to various examples for mechanical product claims.
Considering claims 13 to 17 in the context of the specification, the Court concluded they were not directed to Tecfidera (DMF) itself, but instead directed to the use of that pharmaceutical substance for the stated therapeutic purposes. At least provisionally, the specified therapeutic purpose in the claims is an essential integer of the claims.
The Court observed that each of the remaining 209 claims (putting aside two omnibus claims) made express reference to the substance for use in transplantation medicine or for the therapy of autoimmune disease. Descriptions of the invention and its objects were tied to the use of DMFs in transplantation medicine or the therapy of autoimmune diseases.
Second product launch tips the balance of convenience
Typically, pharmaceutical patentees argue the balance of convenience is in their favour when a generic company threatens to seek PBS listing. The mandatory price cut triggered by the listing of a second brand on the PBS is considered to be irreversible and not able to be remedied by undertakings (eg keeping accounts of sales). Traditionally, this is why courts have usually accepted the balance of convenience weighs in the patentee's favour. However, the Biogen decision demonstrates once again this is no longer the case.
To secure an interlocutory injunction in Australia, the patentee must be prepared to give an undertaking as to damages. If it turns out interlocutory relief was wrongly granted, the generic company (and third parties, such as the Commonwealth, which manages the PBS), can claim compensation under this undertaking. Several such claims have made their way through the courts in recent years. The process is a complex and drawn-out one, and several Federal Court judges have expressed that calculating compensation for an overturned interlocutory injunction is a far greater burden than assessing infringement damages.
In Biogen, both parties argued they would suffer significant irreparable harm, which is not easily quantified, and both provided extensive expert evidence. The Court considered the calculation of loss to Biogen if the injunction was not granted and the loss to Pharmacor if it was wrongly injuncted to be of comparable complexity. The balance of convenience factors were 'quite evenly balanced'.
What ultimately tipped the balance of convenience against granting an injunction was the future launch of Vumerity and the anticipated switch by patients from Tecfidera. The effect of any launch of a product to be marketed as superior to DMF would have a profound effect on the DMF market, transforming it and likely shrinking it.
Changing landscape of interlocutory injunction hearings
Previously, interlocutory injunction applications in pharmaceutical patent cases have focussed less on the issue of the validity of the patent, and more on balance of convenience factors, particularly, whether damages are an adequate remedy. However, generic companies are now bringing infringement and/or validity issues to the fore at the interlocutory stage, increasing the cost and complexity of the applications. In Biogen, in addition to the PTE issue, Pharmacor also raised a novelty attack based on expert evidence.
The case also continues the trend of parties filing evidence from accounting and market experts on balance of convenience matters. Increasingly, parties are relying on this evidence to demonstrate the impact of generic entry, the interruption to the market, and the difficulty in quantifying damages (eg recreating the hypothetical market).
Challenging PTEs: the new weapon of choice
The Biogen decision follows a slew of recent cases considering the scope and application of the PTE provisions in the Patents Act.
Last year, Sandoz was successful in undoing a PTE granted to Merck Sharp & Dohme's patent relating to its diabetes drugs, Januvia and Janumet. This case highlighted a situation where the patent in question covered two pharmaceutical products – Januvia (containing the API sitagliptin), and a combination product Janumet (containing sitagliptin and metformin), which had a later regulatory approval date. The Court confirmed the relevant product and calculation of the PTE period must be based on the earliest first regulatory approval of a product covered by the patent claims, which was Januvia. As Januvia received regulatory approval within five years of the patent filing date, the PTE period for the patent was actually zero.
The Sandoz decision has since been applied by the Australian Patent Office to reduce the extension of a Bayer patent relating to oral contraceptives. In that case the APO concluded that the PTE should have been based on Bayer's Yasmin product, registered on the ARTG in 2001, not Yaz, which was registered in 2008.
We expect to see more attacks on PTEs in the future. Patentees should carefully consider their patent strategy in light of their broader product portfolio and take into account that Australia's PTE provisions have important differences and nuances relative to other jurisdictions. Importantly, any applications for PTE should be based on the earliest first regulatory approval of the patentee's product covered by the patent claims.