Pharmaceutical patents currently under review


On 21 November 2012 the Pharmaceutical Patents Review Panel released a Background and Suggested Issues Paper for a Pharmaceutical Patents Review inviting the public to make submissions by 5pm on 21 January 2013. The panel will submit a full report to the Australian Government in April 2013. The Background and Suggested Issues Paper is available at the Pharma Patents Review website.

Background to the pharmaceutical patents review

On 15th October 2012 Mark Dreyfus, parliamentary secretary for industry and innovation, announced a pharmaceutical patents review. In doing so, he stated that he was taking practical steps to ensure access to affordable medicines, while fostering innovation and research. This followed concerns about a number of aspects of pharmaceutical patents, including bringing generic pharmaceuticals to market and the effect of patent terms on innovation.

For the review, the government commissioned an expert panel chaired by Tony Harris (former New South Wales auditor general and parliamentary budget officer), with members Nicholas Gruen (chief executive officer, Lateral Economics) and Dianne Nicol (associate dean of research, University of Tasmania Faculty of Law).

Terms of reference of the proposed review

The review will evaluate whether the system for pharmaceutical patents effectively balances the objectives of securing timely access to competitively priced pharmaceuticals, fostering innovation and supporting employment in research and industry.

Central to this review will be an analysis of the pharmaceutical extension of term provisions of the act (Section 70).

The review will also consider whether there is evidence that the patent system is being used to extend pharmaceutical monopolies at the expense of new market entrants. In doing this, the review will consider:

  • How patents for new formulations are granted.
  • The treatment of new methods of manufacturing and new uses of known products.
  • The impact of contributory infringement provisions.
  • The impact of extending patent monopolies on entry of generic pharmaceuticals into the market.

Should such evidence be found, the review should provide an assessment of the subsequent impact on competition, innovation and investment.

In conducting the review and making recommendations the panel is to have regard to the following.

  • The availability of competitively priced pharmaceuticals in the Australian market.
  • The role of Australia's patent system in fostering innovation and bringing new pharmaceuticals and medical technologies to the market.
  • The role of the patent system in providing employment and investment in research and industry.
  • The range of international approaches to extensions of term and arrangements for pharmaceutical inventions.
  • Australia's obligations under international agreements (including free trade agreements and the World Trade Organisation agreements).
  • Australia's position as a net importer of patents and medicines.

Other jurisdictions

The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs), which lays down minimum substantive standards of protection that should be provided in each area of intellectual property, including patents, provides that the available term of patent protection must expire no earlier than 20 years from the filing date of a patent. Although the issue of patent term extension to compensate for regulatory delays in the marketing of new pharmaceutical products was raised in the Uruguay Round negotiations, the TRIPs agreement contains no obligation to introduce such a system.

Due to the effective period of protection for inventions of new pharmaceutical products being much less than 20 years, other major developed countries have introduced extension of term provisions for pharmaceutical patents. These countries include the United States, Japan, South Korea, Taiwan, Israel and a number of EU member states. Most of these countries have a maximum five-year extended term. Other countries such as China, Canada, New Zealand, Malaysia, South Africa and various South American countries do not have extended terms.

The pharmaceutical patents review – background and suggested issues paper

The deadline for submissions to the panel is on 5pm 21 January 2013. The issues paper released on 21 November 2012 outlines the review panel’s initial impressions of the key issues. It includes questions that may provide ideas for developing a submission, but submissions need not be limited by the questions.  The questions are:

Question 1: Is the breadth of pharmaceutical patents eligible for an extension of term appropriate?

Question 2: Is the length of the extension of term provided for appropriate?

Question 3: Are the recent amendments to increase the thresholds for the grant of an Australia patent appropriate in the context of pharmaceuticals? If not, why not and what further changes are necessary?

Question 4: Do the systems for opposition and re-examination provide appropriate avenues for challenging the granting and validity of a pharmaceutical patent?

Question 5: Do interlocutory injunctions, as the law is currently applied, provide appropriate relief in cases involving pharmaceuticals?

Question 6: Is Australian law on contributory infringement appropriate in relation to pharmaceuticals?

Question 7: Are the current timeframes in which infringement proceedings must commence appropriate for pharmaceutical patents?

Question 8: Are follow-on patents being used to inappropriately extend protection for pharmaceuticals? If so, how? And, if they are, is this sound policy and what changes, if any, are needed?

Question 9: Is the law on data exclusivity appropriate?

Question 10: Are the laws on patent certificates appropriate?

Question 11: Are the laws on copyright of product information appropriate?

Uncertain Outcome of the Review

There may be some scope for the fine tuning of the current extension of term provisions that have recently produced some adverse outcomes for Australian patentees in the Australian courts. With the emphasis of the review being on striking the balance between the need for incentives for innovators of novel drugs to innovate and the interests of the general community, it seems unlikely that the review process will lead to any extension of the current maximum five-year extension term to extend further the life of pharmaceutical patents. This would be seen as delaying the introduction of the less expensive generic medicines leading to increased cost to consumers and an increase in government expenditure through the Pharmaceutical Benefit Scheme.

Jill Newton