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NEW APPROACHES AND CHALLENGES FOR PHARMA AND BIOSIMILAR PATENT LITIGATION May 2014

Odette Gourley

Partner

Corrs Chambers Westgarth

odette.gourley@corrs.com.au

+61 2 9210 6066

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Agenda

• Urgent injunction applications for Biosimilars

• Non-infringement declarations

• Too much point taking in pharma patent litigation?

MAY 2014

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Urgent injunction applications for biosimilars

• Urgent injunction requirements are arguable case of infringement,

irreparable harm and balance of convenience favouring restraint

pending trial

• More often than not met for small molecules

• Risk of immediate irreversible reimbursed price drop and market share

and profitability loss

MAY 2014

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Urgent injunction applications for biosimilars

• By the way, not always: Hospira v Sanofi 2010

• Docetaxol anti-cancer drug

• Unexplained delay by patentee after early lawyer notice correspondence

with full particulars and active follow up

• Special features of cancer chemotherapy – no automatic price drop,

consequences of price disclosure unclear, market share loss would not be

marked given lack of competition

MAY 2014

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Urgent injunction applications for biosimilars

• All circumstances are relevant so what about biologic generics

• Arguable case of infringement – may be less clear given complexity

resulting from differences over the originator product

• Market circumstances may affect likelihood of irreparable harm and

balance of convenience

MAY 2014

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Urgent injunction applications for biosimilars

• Both products may compete side by side with limited price changes

• Slower rate of conversion of market from the originator product to the

biosimilar

• Additional public benefit arguments because the new product is not the

same (less side effects, improved compliance etc)

MAY 2014

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Non-infringement declarations

• A possible new approach for all generics

• A generic may seek a declaration that its conduct does not or would not

infringe a patent

• Procedure reformed in the 2013 Raising the Bar amendments

• Had previously been rarely used and not with success

MAY 2014

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Non-infringement declarations

• The process involves the provision of full particulars of the conduct

• The generic must be prepared to pay for the patentee to get an opinion

on infringement (not a big deal in the circumstances)

• If the patentee refuses to make an admission of non-infringement, a

declaration may be sought from the Court

• Costs orders flow as is appropriate from the outcome; previously, the

patentee always got its costs, win or lose

MAY 2014

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Non-infringement declarations

• The procedure provides an option for early testing of an infringement

argument

• If the declaration is granted or admission given, the generic is protected

against damages/profits if infringement later established

MAY 2014

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Non-infringement declarations

• Seems to be assumed, however, that patentee does not participate

(because if they did and declaration granted, it is does not seem likely

the declaration would often be later revoked)

• More likely that the declaration prompts an infringement suit and an

invalidity challenge but the tactics may vary from case to case and the

ability to initiate a formal process, or threaten it, will be useful

• After the reforms, no barrier to seeking a non-infringement declaration

and orders for revocation of a patent in the one proceeding (Eli Lilly v

Generic Health 2013) – Justice Nicholas

MAY 2014

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Non-infringement declarations

• The tactics need careful consideration case by case

• Eg failure to seek non-infringement declaration may be relevant to the

balance of convenience

• Consider Hospira v Sanofi 2010 – would the court have expected

Hospira to go further than its correspondence and use the procedure?

• The judges are alive to it: Eli Lilly v Generic Health 2013: the non-

infringement declaration has new life

MAY 2014

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Too much point taking in pharma patent cases?

• Is there a new challenge in the Court seeking to limit the parties’

freedom to run the case as they choose?

• “I don’t see I should let you do this now. That’s not right I mean that is

not the way to run litigation in the 21st century. It does not achieve the

over arching purpose of getting to the real issues as quickly,

inexpensively and as sufficiently as possible. It is, in fact, complete

evasion of that obligation ... I mean, the court has only got so much

time to deal with very well resourced, very rich, very knowledgeable

litigants who know perfectly well what the case was about I’m just not

going to let this blow out ... it’s not right ... because ... this is a real

problem for litigation [in patent cases].”

MAY 2014

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Too much point taking in pharma patent cases?

• Children’s Panadol case study

• Nurofen for Children Australian patent for a liquid dosing apparatus

comprising a bottle, a bottle neck liner and a flat nosed syringe

MAY 2014

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Too much point taking in pharma patent cases?

MAY 2014

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Too much point taking in pharma patent cases?

Claim 1:

A liquid dispensing apparatus comprising a bottle, a bottle neck liner and a flat-

nosed syringe having a plunger and a barrel, the barrel terminating at its distal

end in a generally flat face having a diameter corresponding to the diameter of

the syringe barrel and being perpendicular to the longitudinal axis of the barrel,

the bottle having a bottle neck in which is located the bottle neck liner having a

cylindrical body sealingly engaged inside the bottle neck such that liquid cannot

flow between the bottle neck liner and the bottle neck, the bottle neck liner

comprising a sleeve comprising at its lower end an inward step located within the

bottle neck, an aperture being defined inwardly of the inward step, wherein the

cylindrical body and the sleeve are connected together with a web of material

only at the upper end of the cylindrical body and of the sleeve, wherein the

sleeve is formed with a flared portion at its upper end into which the distal end of

the syringe barrel passes; wherein when the syringe barrel is inserted into the

sleeve the inward step prevents the syringe barrel from protruding past the step

and liquid cannot flow between the sleeve and the barrel, but can leave the bottle

only via the aperture and thence the syringe.

MAY 2014

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Too much point taking in pharma patent cases?

• New Children’s Panadol launched - March 2013

• Letter before action - 22 April 2013

• Proceedings commenced - 2 May 2013

MAY 2014

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Too much point taking in pharma patent cases?

• Interlocutory injunction hearing – 27 - 28 May 2013

• There was an arguable case on infringement, in particular, that the

bottle neck liner had a flared portion with the features in the claim

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Too much point taking in pharma patent cases?

• Validity – arguments on novelty and entitlement weak on the present

evidence

• Balance of convenience – finely balanced but relatively easy to change

the Children’s Panadol product

• Interlocutory injunction granted - 28 May 2013

MAY 2014

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Too much point taking in pharma patent cases?

• Syringe component in the Children’s Panadol liquid dosing apparatus

changed – 31 May 2013

MAY 2014

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Too much point taking in pharma patent cases?

• Second interlocutory injunction hearing – 17 July 2013

• Arguable case of infringement

• The patent claim did not require that the barrel of the syringe have the

same diameter all the way along and Panadol’s argument that the

syringe had a tip or nozzle rather than a flat face was not the better

argument, at the interlocutory stage

• Children’s Panadol not permitted to add new evidence on balance of

convenience

• Interlocutory injunction granted – 17 July 2013

MAY 2014

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Too much point taking in pharma patent cases?

• Children’s Panadol urgent application for leave to appeal - 22 July 2013

• (Also, approach by Children’s Panadol to the trial judge to stand aside

for apparent bias through pre-judgement – 9 August 2013 – see more

later)

• Full Court granted leave and allowed the appeal – 2 September 2013

• Children’s Panadol’s argument on the new syringe was the better

argument

• The Trial Judge was wrong not to allow additional balance of

convenience evidence

MAY 2014

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Too much point taking in pharma patent cases?

• Application to have the Judge stand aside heard - 19 September 2013

• Application heard - 26 and 27 September 2013

• Application dismissed - 27 September

• Urgent application for leave to appeal and appeal – 11 October 2013

• Full Court hearing – application for leave refused - 4 December 2013

MAY 2014

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Too much point taking in pharma patent cases?

• The alleged apparent pre-judgement related to comments about an

expert and about the construction of the claim

• Eg “This is just nonsense isn’t it ... I mean, really, this is just a general

medical use ... and, it doesn’t apply to all syringes. So how on earth

can this be addressed to this particular kind of syringe.”

MAY 2014

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Too much point taking in pharma patent cases?

• Full Court decision

• The judge had not expressed an adverse view about the witness’s

credibility

• Merely an application for an interlocutory not a permanent injunction,

with the primary judge deciding the point of construction at a prima facie

level and on limited evidence

• The debate between bench and bar revealed in the transcript was

robust but readily understood by the fair-minded lay observer as part of

the process of quickly coming to grips and testing arguments

• Nothing suggested a judicial mind incapable of alteration or having a

fixed view

MAY 2014

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Too much point taking in pharma patent cases?

• Case on trial on Monday for two weeks

• What are the learnings?

• Do we need a new approach?

• Unlikely that litigants will drive change

• Will the court drive change?

MAY 2014

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Questions and comments

MAY 2014

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Thank you for attending

Odette Gourley

Partner

Corrs Chambers Westgarth

odette.gourley@corrs.com.au

+61 2 9210 6066

NEW APPROACHES AND CHALLENGES FOR PHARMA AND BIOSIMILAR PATENT LITIGATION

MAY 2014