Extension of time provisions to extend patent terms

In an appeal from a Patent Office decision to grant an extension of time, the Administrative Appeals Tribunal (AAT) recently considered whether the Patent Office had the power to grant an extension of time to apply for an extension of a patent term outside the prescribed period, and whether the office’s use of discretionary powers in awarding the extension was justified.

The AAT upheld the Patent Office decision to grant a 121-month extension of time for H Lundbeck A/S to request an extension of the term of Australian Patent 623,144, covering its anti-depressant pharmaceutical escitalopram (+ citalopram), marketed as Lexapro, based on an earlier listing on the Australian Register of Therapeutic Goods of Cipramil, a racemate mixture of (+) and (-) citalopram.

Without the extension, the Lexapro patent would have expired on 13th June 2009, but with the extension it expired on 9th December 2012. The extended term was important for all parties concerned because the applicants were manufacturers of generic pharmaceuticals and had begun exploiting the Lexapro patent on or around 13th June 2009, and could be liable to pay damages to Lundbeck for infringement of the Lexapro patent during the extended term.

The parties to this dispute have been battling for the past 10 years before the Patent Office and various courts over the validity and term of the Lexapro patent.

Lexapro was listed on the Australian Register of Therapeutic Goods on 16th September 2003 and had been extended by the Patent Office until 13th June 2014 based on this date. 

From 7th July 2005 the applicants challenged the validity of the extension of term of the Lexapro patent, and were successful when the High Court refused to grant special leave to appeal the Full Court of the Federal Court's 11th June 2009 decision. 

The Full Court upheld an earlier Federal Court decision that Cipramil, which was listed on the Australian Register of Therapeutic Goods on 9th December 1997, contained (+) citalopram and that, because Lundbeck’s extension of term application for Lexapro was not based on the first regulatory approval date of goods that contain or consist of (+) citalopram, the application for the extension of term of the Lexapro patent was invalid. As a consequence, the Lexapro patent term extension was revoked and would expire on 13th June 2009.

In addition, the Full Court held that the Lexapro patent claims were valid and infringed by the applicants’ generic products. The High Court’s decision to refuse an appeal meant that the finding on validity and infringement could not be appealed, which has significant ramifications for the applicants.

On 12th June 2009, one day before the Lexapro patent was set to expire. Lundbeck filed an application for an extension of time to file an extension of term application based on the Cipramil Australian Register of Therapeutic Goods listing date. Nevertheless, the applicants went ahead and launched their own generic versions of Lexapro on or around the date on which the patent expired, and furthermore opposed the extension of time request. Clearly, the applicants took a calculated risk, given the likely damages award should the extension of time be granted.

Commissioner's power to extend time
Sections 70, 71, 223(2) and 223(11) of the Patents Act 1990 and Regulation 22.11 of the Patents Regulations 1991 relate to extensions of time and extensions of term. Section 223 gives discretionary power to the commissioner to extend the time for carrying out a relevant act where, because of an error, omission or circumstances beyond the control of the person concerned, the act is not or cannot be done within the required time. 

On 1st June 2011 the Patent Office granted Lundbeck’s application for the extension of time (Alphapharm Pty Ltd v H Lundbeck A/S [2011] APO 36; (2011) 92 IPR 628). The reasons are summarised as follows:

  • Regulation 22.11(4)(b) does not exclude Section 70 applications (for an extension of term) from the provisions of Section 223 (for an extension of time), provided that they are filed within the unextended term of a patent as required by Section 71(2). In the case at hand, a Section 70 application was filed one day before the original term of the patent had expired.
  • The patentee’s "error or omission" was its misunderstanding of the legislative extension of term requirements which led to its failure to apply for an extension of term based on the "correct" Australian Register of Therapeutic Goods listing (of Cipramil). A 121-month extension was reasonable in the circumstances, given the uncertainty in the law and the length and complexity of the multiple court proceedings relating to the patent.

AAT review
The AAT had two questions to consider:

  • Does the legislation allow for an extension of time request for an extension of term of a patent?
  • If so, do the facts of this case justify a discretionary grant of an extension of time of around 10 years?

Extension of time to request extension of term
The applicants gave several reasons why Lundbeck should fail in its request for an extension of time, including the following:

  • Lundbeck did not meet the requirements of Section 71 regarding the timing of an application for an extension of term. Under Section 71(2), an application for an extension of term must be made during the term of the patent and within six months of the latest of the following dates:
    • The date on which the patent was granted.
    • The date of the first inclusion in the Australian Register of Therapeutic Goods of goods that contain, or consist of, any of the pharmacological substances referred to in Section 70(3).
    • The date of commencement of this section (27th January 1999).
  • Regulation 22.11 blocked Section 223 from being available to Lundbeck to request an extension of time within which to file an extension of patent term application. Regulation 22.11(4) excludes from the extension of time regime the filing, during the term of a standard patent as required by Section 71(2), of an application under Section 70(1) for an extension of the term of the patent.

In respect of the first question, and in agreement with the Patent Office decision, the AAT held that if an application for an extension of term is made before the expiry date of the subject patent, the legislation makes available the power to grant an extension of time to satisfy all requirements of a patent term extension request. This is consistent with: 

  • the plain reading of the Patents Regulations and the Patents Act, whereby "an interpretation which results in Section 223 not being available in relation to an extension of term would be contrary to the remedial intent of that Section and produce an anomalous result".
  • The interpretation adopted in the Patent Office Manual of Practice and Procedure.  

Error or omission; discretion to award extension
The applicants contended that there had been no relevant error or omission by Lundbeck or its agents, and that there was no causal connection between any error or omission and the failure to do the relevant act within the time. According to the applicants, Lundbeck’s failure was to seek an extension of term of the patent based on Cipramil which was required to be done within a certain time, and Lundbeck had no such intention in July 2009, or for many years after that, to do so. 

Lundbeck identified the error as being its mistake in considering that the extension could be based only on the registration of Lexapro and not Cipramil, and that at all times it acted consistently with that understanding as evidenced by its conduct.  It was always Lundbeck’s view that Cipramil did not fall within the scope of the claims of a Lexapro patent and, therefore, did not contemplate applying for an extension of term of the Lexapro patent based on the marketing approval of Cipramil. 

The AAT was then asked by the applicants to consider the conduct of Lundbeck in deciding whether it was such that Lundbeck were not entitled to be granted a discretionary extension of time. It is a requirement that once an error or omission has been identified, an application for an extension of time be lodged without undue delay, or the discretion to grant the extension of time might go against the applicant. 

Lundbeck submitted that it had relied on consultations with and advice from its solicitor, and that it had at all times firmly believed that it should wait for the final outcome of the Federal Court proceedings involving related questions as to the validity of the patent and the extension of term before taking any further action, despite a suggestion on 14th July 2005 from its Australian patent attorney "to file an belated application for an extension of time to lodge the extension of term application" based on the Cipramil Australian Register of Therapeutic Goods date.

Lexapro was extended in May 2004 to 13th June 2014. The extension was removed from the register only on 9th February 2010 after special leave to appeal to the High Court had been refused on 11th December 2009.

In respect of the second question, the AAT found that:

  • It was reasonable for Lundbeck to believe that Lexapro had been accorded the correct and appropriate extension of term to 13th June 2014 (it was almost 10 years later that the basis for the extension of term was held to be incorrect in law). The reasonableness of Lundbeck’s belief was supported by evidence that it was widely held among the Australian patent profession that the Federal Court was incorrect in finding that the Cipramil Australian Register of Therapeutic Goods listing date was the proper basis for an extension of the Lexapro patent term. 
  • In relation to undue delay, the patent attorney's "letters setting out preliminary views, comments and possible strategic suggestions do not support a conclusion that the conduct of Lundbeck was in any way unreasonable in not making an application for an extension of time at that point".

It appears that, at least for now, an application for an extension of time to file an extension of term request is available, providing that the extension of term request is filed before expiry of the subject patent.

It is interesting that this appeal went before the AAT rather than straight to the Federal Court. Perhaps the considerable costs to date of the various proceedings between the parties were a factor. A further appeal is a distinct possibility, given that an award of damages for infringement of the Lexapro patent is at stake.

The decision in relation to Lundbeck’s conduct and whether there was undue delay in requesting the extension of time was based on the overall circumstances at the time. Although Lundbeck had received advice regarding the filing of an extension of time four years before it was actually filed, it was considered to be reasonable to set the advice aside and rely on the solicitor's instructions because:

  • The advice was of a very preliminary strategic nature and did not represent the general view of the law at the time.
  • The extension of term date was still being disputed before the court.

The decisions of the Patent Office and the AAT have been appealed to the Federal Court, including an interlocutory injunction application against the Patent Office. The Federal Court is currently taking submissions from the parties and a directions hearing is set for 15th March 2013 to determine whether the appeal will be heard before the Full Court of the Federal Court.

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