Bayer Pharma Aktiengesellschaft  APO 7
7 February 2022
Australian Patent Office
In our 2021 Patent Case summary, we reported on a number of Federal Court decisions that year invalidating PTEs in Australia: Merck Sharp & Dohme Corp. v Sandoz Pty Ltd  FCA 947 (Merck) and Ono Pharmaceutical Co, Ltd v Commissioner of Patents  FCA 643 (Ono). 2022 appeal decisions in those proceedings are reported on pages 42 and 44 respectively.
On 7 February 2022 the Delegate of the Commissioner of Patents issued his decision to rectify the Register to cancel a PTE relating to patent number 780330 (Patent) in the name of Bayer Pharma Aktiengesellschaft (Bayer) because it was not based on the first Australian Register of Therapeutic Goods (ARTG) listing of a product containing a pharmaceutical substance per se covered by the patent. The decision followed an application for rectification filed by a law firm under s191A of the Patents Act 1990 (Cth) (Act) on the basis that the PTE had been wrongly entered into the Register. The granted PTE extended the term of Bayer’s patent from 31 August 2020 until 8 February 2023.
The Patent claimed pharmaceutical compositions of drospirenone and ethinylestradiol in tablet form with specified dissolution features. It was not disputed that Bayer has obtained approval for, and marketed, two contraceptive pill products falling with the scope of the patent claims – YASMIN and YAZ – each containing different amounts of the claimed active ingredients. The Patent had already been the subject of lengthy litigation proceedings between Bayer and Generic Health Pty Ltd1, which ultimately upheld its validity and resulted in a substantial damages claim for infringement. However the validity of the PTE was not challenged in those proceedings.
A PTE must be based on the ‘earliest first regulatory approval date’ of a pharmaceutical substance per se covered by the patent. The PTE will extend the patent for a period of time (up to five years) equivalent to the length of time between the patent filing date and the relevant ARTG listing date, minus five years. In other words it is intended to compensate the patentee for delay of more than five years in obtaining ARTG listing after filing its patent. The PTE in this case was originally granted on the basis of the ARTG listing of the YAZ product, on 8 February 2008. However YASMIN had been ARTG-listed on 6 July 2001. As the YASMIN listing date was less than five years after the patent date (31 August 2000) a PTE calculated by reference to YASMIN would be zero.
Bayer submitted to the Delegate that the relevant product for ascertaining the applicable first regulatory approval date was that containing the pharmaceutical substance per se identified in Bayer’s PTE application, i.e. YAZ, rather than any substance falling within the scope of the claims. In other words, Bayer submitted, where more than one product falling within the patent scope has been ARTG-listed, the patentee can select between such products, at least where an earlier ARTG-listed product is not entitled to a PTE.
On 12 August 2021, after the hearing but before the Delegate’s decision, Jagot J’s judgment in Merck issued, addressing this specific scenario of multiple approved products claimed by a single patent. As was the case for Bayer, the products in Merck were both sponsored by the patentee. In Merck her Honour found that the nomination or selection by the applicant of a pharmaceutical substance per se does not affect ‘what is, in fact, the earliest inclusion on the ARTG’ of any substance falling within the claims. Moreover, Jagot J distinguished the decision of Beach J in Ono in which, pointing to the purpose of the PTE system to reward a patentee, he accepted that the relevant product must be that of the patentee and not a third party product falling within the patent claims with an earlier ARTG listing date.
The impact of the Merck decision therefore was that, for the purposes of a PTE application, a patentee must rely on its first ARTG-listed product falling within the scope of the relevant patent claims, and is not entitled to a PTE if any relevant product is approved within five years of the patent date. Bayer did not dispute that Jagot J’s decision was relevant, but noted that it was (and is) on appeal. The Delegate found that the decision in Merck could not be relevantly distinguished from the facts in the case before him and so found the PTE invalid on this basis.
Bayer appealed the Delegate’s decision to the Federal Court, which appeal was then stayed by consent pending the determination of any application for special leave to the High Court of Australia to appeal the Full Court decision in Merck or the expiry the time for filing such an application.
Following the appeal decision in Merck, Bayer discontinued the appeal.
S191A of the Act permits the Commissioner to rectify the Register if s/he is satisfied on the balance of probabilities, subject to giving the patentee a reasonable opportunity to be heard, that there is either an omission of an entry on the Register, an entry without sufficient cause, an entry wrongly existing on the Register, or an error or defect in any entry.
Although the Delegate had the benefit of certain findings by the Federal Court in the infringement litigation (that the YASMIN product fell within the scope of the claims), the rectification procedure was still heard in a remarkably short time, the hearing being held approximately three months after the rectification application was filed. The time to issue a decision, 14 months, was much longer, however this may well have been attributable to the impending hearing and judgment in Merck.
Additionally, and importantly, unlike a request for rectification by the Court under s192 of the Act, s191A does not require that the applicant be a person aggrieved by the error. This means that an application for rectification can be filed anonymously, as was
presumably the case here.
Following the Full Court’s decision in Merck the rectification procedure is a potentially powerful tool for generics to remove problematic PTEs. There are likely numerous patents on the Register subject to PTEs which may be invalid on the same basis, or because they are based on EPC 2000 claims, as was the case for the interlocutory decision in Biogen International GmbH v Pharmacor Pty Ltd  FCA 1591.
1 See Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft  FCAFC 183
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