Increased Regulation of Interactions with Healthcare Professionals
In an effort to increase the transparency of interactions between pharmaceutical companies and health care professionals the new (17th) edition of the Medicines Australia Code of Conduct introduces requirements for member companies to report payments made to HCP consultants and advisory board members to Medicines Australia for publication on its website.
The Code requires disclosure of the aggregate fees paid to healthcare professionals including professional consultancy fees, as well as hospitality and accommodation payments both within and outside Australia. Disclosure of recipient HCP names is not required. A Medicines Australia Transparency Working Group is further considering whether additional requirements for reporting by reference to individual HCPs should be imposed and the Group's final recommendations are anticipated in June 2013.
In the meantime, a push for greater transparency of these interactions mandated by new legislation is being pursued in the Australian Federal parliament. The Therapeutic Goods Amendment (Pharmaceutical Transparency) Bill 2013 (Cth) was introduced to the Senate on 28 February 2013, seeking to replace the Code and subject "regulated corporations" to reporting requirements which would include the identification of recipient HCPs. The Bill proposes a range of restrictions on pharmaceutical companies including: prohibiting sponsorship of conferences and educational seminars for HCPs held outside of Australia; and prohibiting payments to HCPs to travel or attend educational seminars and scientific conferences domestically or overseas where the HCPs are not representing the pharmaceutical company. The Bill has been the subject of widespread industry condemnation.
PBS Price Reductions Invalid
Sanofi-Aventis Australia Pty Limited v Minister for Health  FCA 1420
Sanofi-Aventis has successfully challenged the validity of two determinations made by the Minister for Health, the effect of which reduced the reimbursement paid by the Australian Government for brands of risedronic acid oral and docetaxel injection under the Pharmaceutical Benefits Scheme (PBS).
Sanofi-Aventis supplies Actonel® (risedronic acid oral) and Taxotere® (docetaxel injection). These items are listed on the F2 formulary of the PBS and are subject to price reductions arising from mandatory price disclosure.
Sanofi-Aventis was required to disclose data concerning the sales revenue, volume and incentives provided for Actonel® and Taxotere® supplied during the relevant data collection period (disclosed data). The disclosed data was used along with other PBS data collected by the Minister's department to determine the weighted average disclosed price of each brand of pharmaceutical item (WADP). Where the WADP of a brand of pharmaceutical item is at least 10% lower than the current approved ex-manufacturer, the current approved ex-manufacturer price will be reduced to the WADP.
The Federal Court held that the Minister failed to calculate the WADP correctly as data was erroneously excluded for brands of Actonel® and Taxotere® that were listed on the PBS during the data collection period, but were no longer listed on the PBS at the time the determinations were made. His Honour's judgment provides a useful summary of the complex PBS pricing arrangements and confirms that the Federal Court is willing to uphold challenges to government pricing decisions.
BRCA Gene Patent Valid
Cancer Voices Australia & Anor v Myriad Genetics Inc & Ors  FCA 65
The Federal Court has upheld the validity of Myriad's BRCA1 gene patent, concluding that genetic material may constitute patentable subject matter in Australia.
The applicants, Cancer Voices Australia and Yvonne D'Arcy, challenged the validity of Myriad's Australian standard patent (No. 686004) which claimed isolated nucleic acid coding for a mutant or polymorphic BRCA1 protein. The main issue for determination by the Court was whether isolated DNA or genes (i.e. extracted from the cell) are a "manner of manufacture", a requirement of patentability under section 18(1) of the Patents Act 1990 (Cth).
Relying on the High Court decision in National Research Development Corporation v Commissioner of Patents (1959)102 CLR 252, Justice Nicholas held that a composition of matter may constitute patentable subject matter if it consists of an artificial state of affairs, that has some discernible effect, and that is of utility in a field of economic endeavour. While the applicants' did not challenge the economic utility of Myriad's claimed invention, they argued that the claimed invention was not an artificial state of affairs as the isolated nucleic acid is not significantly or materially different to that which occurs in nature.
His Honour disagreed and held that in the absence of human intervention, naturally occurring nucleic acid does not exist outside the cell, and “isolated” nucleic acid does not exist inside the cell. Isolated nucleic acid is the product of human intervention involving the extraction and purification of the nucleic acid found in the cell and is therefore an artificial state of affairs. The real difficulty therefore lies in determining how much "human intervention" is required in order to conclude that an "artificial state of affairs" exists. Yvonne D'Arcy, a representative applicant, has filed an appeal to the Full Federal Court.
AstraZeneca Loses Crestor Patents
Apotex Pty Ltd v AstraZeneca Ab (No 4)  FCA 162
Apotex, Watson Pharma and Ascent Pharma have successfully challenged three patents protecting AstraZeneca's blockbuster drug, Crestor (rosuvastatin) which generated approximately $350 million in sales in Australia during 2012.
The patents concerned:
• a pharmaceutical formulation of rosuvastatin and an inorganic salt having a multivalent cation (formulation patent) (expiry 2020);
• the use of rosuvastatin for treating heterozygous familial hypercholesterolemia (HeFH patent) (expiry 2021); and
• the use of a low dose of rosuvastatin to treat hypercholesterolemia (low dose patent) (expiry 2020).
In March 2013, the Federal Court invalidated all three patents on the basis of lack of novelty and inventive step. In addition, the Court found that AstraZeneca lacked entitlement to the low dose patent (on the basis of naming the wrong inventor) and that the "invention" claimed in the HeFH patent was not a manner of manufacture.
A key aspect of the decision on inventive step concerned whether knowledge of rosuvastatin could be assumed in the context of assessing inventive step (obviousness), even if it did not form part of the common general knowledge. In this case the Judge held that each of the patents assumed the existence of the rosuvastatin compound and therefore its discovery was not part of the invention.
The Court dissolved the interlocutory injunctions obtained by AstraZeneca in late 2011 and 2012 preventing market entry of a generic rosuvastatin product. AstraZeneca has appealed the decision to the Full Federal Court, and the appeal hearing will commence on 31 July 2013.
Reform of Australian Patent Laws
Significant amendments to Australian patent laws have taken effect from 15 April 2013 with the Intellectual Property Amendment (Raising the Bar) Act implementing a range of reforms, including to the scope of the prior art base and patentability requirements.
The Australian Government's review of pharmaceutical patents is the subject of a recent draft report released by an expert panel suggesting potentially significant changes to the current regime.
Raising the Bar
The key amendments to Australian patent laws include:
1. changes to the scope of the prior art base and common general knowledge for assessing inventive the step, as well as amendments to patentability requirements, including utility, sufficiency and fair basis;
2. reducing delays in the resolution of patent applications; and
3. simplification of the patent system by elimination procedural hurdles and streamlining patent office processes.
These amendments follow the inclusion of a statutory protection for experimental use of patented inventions which was introduced as part of the Raising the Bar reforms in April 2012.
Further details of these reforms can be found in our Legal Alert - Australia: Significant Reform of Patent Laws, available here.
Pharmaceutical Patents Review
The expert panel appointed by the Australian Government to review pharmaceutical patents in Australia released its Draft Report on the 3 April 2013. A number of potentially significant changes are foreshadowed in the Draft Report, including:
• reductions to the extensions of term available for pharmaceutical patents by providing direct subsidies to pharmaceutical companies to promote R&D in Australia;
• the introduction of a transparency register containing a list of patents identified by a sponsor as relevant to each of its drugs included on the ARTG;
• amending section 117 of the Act which imposes liability for contributory infringement on suppliers by introducing a defence for suppliers where they take "reasonable steps" to ensure the product will only be used in a non-infringing manner; and
• allowing manufacture for export only through the Government seeking agreement from pharmaceutical companies to not enforce their Australian patents in respect of these acts.
Submissions in response to the draft report are due by 5 pm on 30 April 2013. The panel is expected to provide a final report to the Federal Government in May 2013.
At the same time, the Federal Government's Advisory Council on Intellectual Property is assessing the effectiveness of the innovation patent system which is utilised by many life sciences companies to obtain swift, more limited patent protection in Australia. ACIP's final report is expected to be released in mid-2013.
Lunbeck Granted 10 year Extension of Time
Aspen Pharma Pty Ltd and Ors and Commissioner of Patents and H Lundbeck  AATA 851
The Administrative Appeals Tribunal's (AAT) has upheld a decision by the Australian Patent Office (APO) granting Lundbeck a 121 month extension of time to apply for an extension of term of its pharmaceutical patent (AU No. 623,144) covering the escitalopram (marketed as LEXAPRO).
Lundbeck had applied for an extension of term of its patent based on the date of inclusion of LEXAPRO on the ARTG (16 September 2003) however, the Full Federal Court held that the extension of term was invalid as it was not based on the correct ARTG date. Lundbeck should have applied for an extension of the term by 27 July 1999 based on the inclusion of CIPRAMIL (as it found that this was actually the first good to contain or consist of escitalopram) on the ARTG.
Lundbeck subsequently applied for, and was granted by the APO, an extension of time to apply for an extension of term based on the correct date, on the basis it had made an error or omission.
The AAT upheld the APO's decision and confirmed that, provided the extension of term application is filed before the expiry of the patent, an extension of time is available in respect of extension of term applications. Despite Lundbeck having received legal advice in 2005 suggesting it may wish to make a contingent application for an extension of time based on the CIPRAMIL registration in the event the Court did not find in its favour, the AAT accepted that Lundbeck's failure to file an extension of term application constituted an "error or omission" based on a genuine misunderstanding of the relevant provisions.
Aspen, Alphapharm and Sandoz have appealed the AAT's decision to the Federal Court. On 9 April 2013, the Court has refused an application for a stay of the decision of the AAT pending the appeal. A trial date is yet to be set.
Australia’s Therapeutic Goods Administration (TGA) and New Zealand’s Medsafe Authority jointly released a consultation paper on 8 January 2013, seeking comments regarding high level features of a framework for the regulation of therapeutic products within the Australia New Zealand Therapeutic Products Agency (ANZTPA) scheme. ANZTPA is expected to come into operation on 1 July 2016.
Submissions were sought in relation to:
• whether or not parties support the ANZTPA framework;
• how the proposed scheme will affect parties;
• potential benefits in respect of the harmonisation of the TGA and Medsafe regulatory processes; and
• suggested improvements to the regulatory processes.
The consultation paper, entitled Description of a possible joint regulatory scheme for therapeutic products under ANZTPA, sets out key areas where the regulators aim to develop a more integrated and cost-effective marketplace for therapeutic products in Australia and New Zealand. Medicines, medical devices (including in vitro diagnostic medical devices), most blood and blood components, and biologicals will be regulated under ANZTPA. The scheme will also provide access to certain unapproved therapeutic devices and enable certain unapproved therapeutic devices to be used in clinical trials.
Submissions on the consultation paper were sought by 21 February 2013. Feedback from the TGA and Medsafe based on these submissions is expected, but yet to be released.