Kieran Williams, Shelston IP - Patent Term Extensions (PTEs) in Australia

PTEs in Australia

Patent Term Extensions

(PTEs) in Australia Kieran Williams

PTEs in Australia

Focus of presentation

• Purpose of PTEs

• Eligibility criteria

• PTE length

• Monopoly rights during PTEs

• Deadlines for requesting PTEs

• Documentation required for PTE application

• Strategies for maximising PTEs

• Recommendations of the Pharmaceutical Patents

Review regarding PTEs

• Fate of the Pharmaceutical Patents Review

PTEs in Australia

Purpose of PTEs

• Marketing of pharmaceuticals in Australia requires

approval by the Therapeutic Goods Administration (TGA)

and inclusion in the Australian Register of Therapeutic

Goods (ARTG).

• Considerable research and testing is required before

TGA approval is obtained and a product can enter the

market.

• TGA approval is often not obtained until 10 to 15 years

after the initial identification of a new active compound

due to the stringent requirements for clinical trials.

PTEs in Australia

Purpose of PTEs

• Patent applications are typically filed during early phase

research or preclinical testing.

• TGA approval for a pharmaceutical substance covered

by a patent is often not obtained until many years into

the 20-year term of the patent.

• To compensate for this loss of protection, patentees may

request an extension of their patent for up to 5 years

beyond the standard 20-year term (Patents Act s70).

• Goal is to provide a effective patent life of 15 years.

• Similar provisions exist in Europe, US and Japan.

PTEs in Australia

Eligibility criteria

• The patent must relate to a pharmaceutical substance

per se or a pharmaceutical substance when produced by

recombinant DNA technology.

• The pharmaceutical substance must be disclosed in the

specification and fall within the scope of the claims.

• The pharmaceutical substance must be included in the

ARTG before the 20-year term of the patent expires.

• The ARTG entry must be current at the time the

application for PTE is lodged at the Patent Office.

PTEs in Australia

Eligibility criteria

• At least 5 years must have elapsed between the date of

the patent and the date of first inclusion of the

pharmaceutical substance in the ARTG.

• The “date of the patent” is the filing date of the patent or,

in the case of a patent arising out of a PCT application or

a divisional application, the filing date of the PCT

application or parent application.

• The term of the patent must not have been previously

extended.

PTEs in Australia

Eligible claims

• A substance of formula X.

• Substance X mixed with substance Y.

• A composition comprising X, Y and Z.

• Substance X when produced by method Y, wherein

method Y involves the use of recombinant DNA

technology.

PTEs in Australia

Ineligible claims

• A method of treatment of disease Y comprising

administering substance X.

• Use of substance X in the treatment of disease Y (Swiss

style format).

• Substance X for use in the treatment of disease Y

(European second medical use format)

• Substance X when used ....

• A method of preparing substance X.

PTEs in Australia

What is a pharmaceutical

substance?

• “Pharmaceutical substance” means a substance

(including a mixture or compound of substances) for

therapeutic use whose application (or one of whose

applications) involves:

a) a chemical interaction, or physico-chemical

interaction, with a human physiological system; or

b) action on an infectious agent, or on a toxin or other

poison, in a human body.

• Does not include a substance that is solely for use in in

vitro diagnosis or in vitro testing.

PTEs in Australia


substance?

• Therapeutic use means use for the purpose of:

a) preventing, diagnosing, curing or alleviating a

disease, ailment, defect or injury in persons; or

b) influencing, inhibiting or modifying a physiological

process in persons; or

c) testing the susceptibility of persons to a disease or

ailment.

• If a substance is listed in the ARTG, there is a prima

facie assumption that the substance is a pharmaceutical

substance.

PTEs in Australia


substance per se?

• Contentious issue:

Sanofi-Aventis [2007] APO 35

LTS Lohmann Therapie-Systeme GmbH & Co KG

[2002] APO 12

PTEs in Australia

PTE length

• The length of the PTE is dependent on the date of

inclusion in the ARTG of any pharmaceutical substance

covered by the claims of the patent.

• Inclusion in the ARTG may be for any purpose e.g.,

receipt of marketing approval for the pharmaceutical

substance or listing of the pharmaceutical substance for

export.

• The period of the extension cannot be longer than 5

years.

PTEs in Australia

PTE length

• If the pharmaceutical substance was included in the

ARTG:

a) less than 5 years after the date of the patent - no

extension is available;

b) 5 - 10 years after the date of the patent - the term of

the patent will be extended to 15 years from the date

of inclusion of the pharmaceutical substance in the

ARTG; or

c) more than 10 years after the date of the patent – a 5-

year extension is available.

PTEs in Australia

Monopoly rights during PTE

• The rights conferred by the PTE are not confined to the

pharmaceutical substance included in the ARTG.

• If a PTE is granted, all pharmaceutical substances

covered by all claims of the patent are protected during

the period of the extension – irrespective of whether they

are included in the ARTG and irrespective of the number

of pharmaceutical substances claimed.

• The patent is not extended insofar as it relates to

substances that are not pharmaceuticals e.g., veterinary

products.

PTEs in Australia

Deadline for lodging the PTE

request

• An application for a PTE must be lodged within 6 months

from the later of the following dates:

a) the date the patent was granted; or

b) the date of first inclusion in the ARTG of a

pharmaceutical substance covered by the patent.

• A PTE cannot be made before a patent is granted or

before a pharmaceutical substance covered by the

claims is included in the ARTG.

PTEs in Australia

First inclusion in ARTG

• “First inclusion in the ARTG” means the first time the

goods are included in the ARTG, regardless of whether

the goods are included in the part of the register relating

to registered goods, or the part relating to listed goods.

• Registered goods are assessed by the TGA for quality,

safety and efficacy. Listed goods are assessed for

quality and safety, but not efficacy.

• “First inclusion in the ARTG” also includes obtaining

export approval of a drug prior to obtaining marketing

approval.

PTEs in Australia


• Merck & Co., Inc v Arrow Pharmaceuticals Ltd [2003]

FCA 1344

A pharmaceutical substance should be considered to

be included in the ARTG where it can be

demonstrated that the substance is contained in a

good which is included in the ARTG.

The pharmaceutical substance need not be a named

active ingredient in the ARTG, but may be an impurity

present in only small amounts, e.g. a metabolite.

PTEs in Australia


• G.D.Searle LLC [2008] APO 31

Patentee applied for a PTE based on the

pharmaceutical substance darunavir.

During examination found that there was another

substance, amprenavir, which fell within the scope of

the claims and was included in the ARTG.

As amprenavir was registered before darunavir, the

PTE had to be based on the former substance.

Immaterial that the registration of amprenavir was

sponsored by a person other than the patentee.

PTEs in Australia


• H Lundbeck A/S v Alphapharm Pty Ltd [2009] FCAFC 70

The subject of the patent was the (+) enantiomer of

the drug citalopram.

Pharmaceutical substances containing the racemic

form of citalopram were already included in the ARTG.

Inclusion of goods containing, or consisting of, a

racemic mixture in the ARTG, amounts to inclusion of

goods containing, or consisting of, the individual

enantiomers.

Important decision for the timing of PTE applications.

PTEs in Australia

Extension of time to file PTE

request

• Extensions of time may be possible under s223(2) if it

can be shown that the failure to lodge the PTE request

was due to:

a) an error or omission by the person concerned or by

his or her agent or attorney; or

b) circumstances beyond the control of the person

concerned.

PTEs in Australia


request

• Aspen Pharma Pty Ltd and Ors v Commissioner of

Patents and H Lundbeck (Joined Party) [2012] AATA 851

Tribunal found that section 223 provides the

Commissioner with the power to extend the time for

making a PTE application, providing the request is

made within the term of the patent.

Tribunal found that Lundbeck’s filing of the PTE

application some 121 months late was due to a

misunderstanding of the law and, therefore, an

extension of time to file the PTE application was

possible under section 223.

PTEs in Australia


request

• This reasoning was followed by the tribunal in Merck

Sharp and Dohme Corp and Commissioner of Patents

[2013] AATA 71 at [12].

• On 18 November 2013, the Full Court dismissed an

appeal by Alphapharm against the AATA decision.

• Appeal to High Court lodged by Alphapharm on 16 May

2014.

PTEs in Australia

Documentation required

• The PTE application must:

Provide the applicant/patentee and patent details.

Identify goods containing (or consisting of) the

pharmaceutical substance currently included in the

ARTG.

Provide the date of first inclusion the ARTG.

Be accompanied by a print out from the ARTG

confirming that the pharmaceutical substance is

registered on the ARTG.

PTEs in Australia



Indicate whether or not there is pre-TGA marketing

approval for the pharmaceutical substance.

Indicate how the pharmaceutical substance included

in the ARTG is identified in the complete specification.

State that the pharmaceutical substance is in

substance disclosed in the complete specification and

in substance falls within the scope of a claim or

claims.

PTEs in Australia



Indicate whether there are relevant court proceedings

in relation to the patent.

Identify related patents that, to the best of the

patentee’s knowledge, rely on the same ARTG

registration.

PTEs in Australia

Divisional Applications

• A divisional application is filed to divide a patent

application (known as the parent application) into two or

more applications.

• Patents derived from a parent application and its

divisional application are each entitled to separate PTEs.

• If a patent claims more than one pharmaceutical

substance for which ARTG listings may be obtained at

different times, dividing the pharmaceutical substances

into divisional applications may allow for longer PTEs to

be obtained for subsequent ARTG listings.

PTEs in Australia

Opposition to PTEs

• Once an application for a PTE is advertised as accepted,

third parties have 3 months from the date of publication

of the notice of acceptance in the Official Journal to file a

notice of opposition to the PTE.

PTEs in Australia

Renewal fees

• 4th to 9th anniversaries - $300/year

• 10th to 14th anniversaries - $500/year

• 15th to 19th anniversaries - $1,220/year

• 20th to 24th anniversaries - $2,350/year

PTEs in Australia

PTE reporting

• After an application for a PTE has been granted, the

patent holder must lodge with the Secretary of Health

and Family Services, before the end of the following

financial year, a return setting out the following

information (relating to activities occurring in Australia

concerning the specific drug registered on the ARTG):

Details of the amount and origin of any

Commonwealth funds spent in the research and

development of the drug which was the subject of the

application.

PTEs in Australia

PTE reporting

The name of any body:

o with which the applicant has a contractual

agreement; and

o which is in receipt of Commonwealth funds.

The total amount spent on each type of research and

development, including preclinical research and

clinical trials, in respect of the drug which was the

subject of the application for the periods (a) initial

research up until the granting of the PTE and (b)

period from granting of the PTE up until the expiry of

the patent.

PTEs in Australia

PTEs in Australia

Terms of reference

• On 15 October 2012, the Parliamentary Secretary for

Innovation announced a review of pharmaceutical

patents.

• The review was set up to evaluate whether the system

for pharmaceutical patents is effectively balancing the

objectives of securing timely access to competitively

priced pharmaceuticals, fostering innovation and

supporting employment in research and industry in

Australia.

• Central to the review was an analysis of the current PTE

provisions.

PTEs in Australia

Pharmaceutical patents in

Australia

• In Australia, pharmaceuticals represent the third largest

technology area for patent application filings.

• Pharmaceutical inventions represented 5.7% of the

patent applications filed between 1997 and 2011.

• This compares to 7.5% in the UK, 6.0% in the US, and

6.0% in Canada.

• 4.4% of pharmaceutical applications filed between 2007

and 2011 made by Australian residents.

• Majority of pharmaceutical applications are made by

foreign applicants.

PTEs in Australia


Australia

• Between 2007 and 2011, US applicants accounted for

47.6% of pharmaceutical applications, followed by

Chinese applicants with 7% and German applicants with

6%.

• Most pharmaceutical patent applications are filed by

multi-national pharmaceutical companies.

• Novartis (357), Merck, Sharp and Dohme (119) and

Wyeth (118) are the three largest filers of pharmaceutical

patent applications in Australia between 2007 and 2011

(total of 11,468 pharmaceutical applications).

PTEs in Australia


Australia

• A significant proportion of total drug revenue earned by

pharmaceutical companies comes from a relatively small

number of drugs.

• In Australia, in the 2011-12 financial year three drugs

accounted for 16.7% of total cost to the Government

through the PBS. These were Atorvastatin ($593.3

million), Rosuvastatin ($359.2 million) and Ranibizumab

($307.8 million).

• Each of these drugs is patented, with the key patent on

Atorvastatin expiring in 2012, and the key patents on

Rosuvastatin and Ranibizumab due to expire in 2020.

PTEs in Australia


Australia

• When a patent expires, cheaper generic versions of the

drugs come onto the market, driving prices down and

eating into the patentee’s market share.

• When combined with the automatic 16% PBS price

reduction and ongoing price disclosure reductions, this

leads to price reductions of on average 25%, but in some

circumstances well over 50%.

• Extending patent term is of great importance to

patentees.

PTEs in Australia

PTEs in Australia

• From the commencement of the current PTE provisions

in 1999 through to October 2012 there were 599 PTE

applications and 560 (94%) of these were accepted.

• An effective patent life of 15 years was provided for 53%

of extended patents.

• For the period 2003-2010 inclusive, an estimated 58% of

new chemical entities approved by the TGA had a PTE.

PTEs in Australia

PTEs in Australia

• The remaining TGA approvals for new chemical entities

include medicines that took less than 5 years to get

approval, medicines with patents not eligible for

extension and medicines without patent protection.

• New chemical entities only account for a portion of all

TGA approvals.

• Of all the new medicines approved by the TGA for the

period 2003-2010 (including new chemical entities) an

estimated 21-24% would have received a PTE.

PTEs in Australia

Distribution of extended patents

by effective patent life

Effective patent life

(and extension length)

Percentage of all

extended patents

15 (0-0.99) 7%

15 (1-1.99) 12%

15 (2-2.99) 11%

15 (3-3.99) 12%

15 (4-5.00) 11%

14-15 (5) 9%

13-14 (5) 9%

12-13 (5) 8%

11-12 (5) 6%

10-11 (5) 5%

5-10 (5) 11%

TOTAL 100%

53%

PTEs in Australia

Distribution of extended patents

by length of PTE

Length (years)

5 4-5 3-4 2-3 1-2 0-1

Percentage of

all extended

patents

47% 11% 11% 11% 12% 7%

PTEs in Australia

316

14

36

20

87

0

50

100

150

200

250

300

350

New molecular entity (NME) New ester, new salt, or other

derivative

New formulation New combination Biologic/Antibody/Vaccine

Pharmaceutical Type

No

. o

f E

xte

nd

ed

Pa

ten

ts

Number of Extended Patents by

Pharmaceutical Classification

New molecular

entity New

formulation

New ester, salt or

derivative New

combination

Biologic, antibody

or vaccine

PTEs in Australia

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

New molecular entity (NME) New ester, new salt, or other

derivative

New formulation New combination Biologic/Antibody/Vaccine

Pharmaceutical Type

Av

era

ge

eff

ec

tiv

e p

ate

nt

life

(y

ea

rs)

Average Effective Patent Life for

Extended Patents by

Pharmaceutical Classification

New molecular

entity New

formulation

New ester, salt or

derivative New

combination

Biologic, antibody

or vaccine

PTEs in Australia

Focus of review regarding PTEs

• The explanatory memorandum of the bill introducing the

current PTE provisions stated:

The objective of this proposal is to provide an

effective patent life (period after marketing approval is

obtained, during which companies are earning a

return on their investment) more in line with that

available to inventions in other fields of technology.

It is also intended to provide a patent system that is

competitive with other developed nations and attract

investment in pharmaceutical R&D to Australia.

PTEs in Australia

Are PTEs attracting investment?

• Review panel found:

PTEs are not attracting investment in pharmaceutical

R&D in Australia.

Only a gradual increase in R&D investment over the

period between 1992 and 2011 has been observed.

No notable increase in investment post introduction of

the 20 year term in 1994 or introduction of the current

PTE provisions in 1999.

PTEs in Australia


PTEs in Australia


• Review panel found:

Extending patent terms in Australia is an imperfect

policy tool for encouraging pharmaceutical innovation

because of its limited capacity to provide an increased

incentive to innovate.

However important pharmaceutical R&D is to

Australia’s economy and to Australian’s health, there

is no evidence or convincing argument to demonstrate

that the PTE scheme is contributing to the

development of the Australian industry or to Australian

R&D in a way that is commensurate with its very

substantial costs.

PTEs in Australia

Reducing PTEs

Reduction in Maximum Effective

Patent Life

Estimated PBS

Savings ($m)

15 years to 14 years 46





PTEs in Australia

Recommendation 4.1

• The Government should change the current PTE

provisions to reduce the maximum effective patent life

from 15 years to 10 years (Harris and Gruen) or 12 years

(Nicol).

• The current 5 year cap on extensions should remain,

providing a maximum of 25 years patent term for

extended patents.

PTEs in Australia

Recommendation 4.2

• The Government should use part of the associated

savings from recommendation 4.1 to fund R&D directly.

• Funding could be targeted to socially beneficial research

where patent incentives may be inadequate.

• Annual review of the savings delivered through any

reduction in effective patent life with some share of those

savings used to fund replacement R&D subsidies.

PTEs in Australia

Recommendation 5.1

• The Government should maintain the current approach

that allows extensions for drugs and formulations but not

for methods of use and manufacture.

PTEs in Australia

Recommendation 5.2

• Section 70(3) should be amended to clarify that the

ARTG registration on which a PTE is based is that of the

relevant product, the use of which would infringe the

claim.

PTEs in Australia

Fate of the Review

• On 11 February 2014, the Minister for Industry

responded to a Question in Writing:

The Government has no plans to release the final

report at this stage. The Government is not

considering the recommendations made by the panel

in the draft report. The Pharmaceutical Patents

Review panel delivered its final report to the previous

government in May 2013, which did not release the

report. As the Pharmaceutical Patents Review was

commissioned by the previous government and

conducted by an independent panel, the government

is not obliged to release the report”.

PTEs in Australia

Fate of the Review

• Final Report released “in response to stakeholder interest”

on 20 March 2014 accompanied by a government

statement:

The Government notes that the report is one of a

number of reviews of the pharmaceutical system

conducted during the term of the previous government.

The Government has no plans to respond to the report

at this stage but may take information in the report into

account when considering future policy. The views

expressed and recommendations made in the report

are those of the review panel and do not necessarily

reflect government policy”.

PTEs in Australia

Summary

• Make sure claims are present that are clearly directed to

a pharmaceutical substance per se.

• Use divisional applications to maximise PTEs.

• Timing is critical – PTE registration must be requested

within 6 months of the later of:

Gant of patent; or

First inclusion in ARTG listing (beware of previous

ARTG listings for racemic mixtures or metabolites).

• Changes to PTEs may be on the horizon.

PTEs in Australia

Contact details

Kieran Williams p:+61 2 9777 1111

f: +61 2 9241 4666

e: [email protected]

au.linkedin.com/in/kieranwilliamspatentattorney

mailto:[email protected]

http://au.linkedin.com/in/kieranwilliamspatentattorney/

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Kieran Williams, Shelston IP - Patent Term Extensions (PTEs) in Australia

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Transcript of Kieran Williams, Shelston IP - Patent Term Extensions (PTEs) in Australia