Pharmaceutical bioequivalence and patent claim infringement: a catch 22

In Glaxo SmithKline Australia Pty Ltd v Pharmacor Pty Ltd (2014), a case that was recently before the Federal Court of Australia, Glaxo SmithKline Australia Pty Ltd (“GSK”) successfully applied under rule 7.23 of the Federal Court Rules 2011 (Cth) that Pharmacor Pty Ltd (“Pharmacor”) give discovery and inspection of various documents lodged at the TGA and, in terms of Section 23 of the Federal Court of Australia Act 1976 (Cth), provide a sample of at least 50 tablets of each of its two modified release oral paracetamol products (“the Pharmacor Products”).

The Application for discovery and inspection was made by GSK on the grounds of potential entitlement to relief, including injunctive relief, declaration and damages, as a result of Pharmacor’s alleged misrepresentations of bioequivalence of its products to the TGA; the actual or anticipated promotion of Pharmacor’s products to pharmacists and consumers; and Pharmacor’s alleged potential infringement of the Claims of Australian Patent No. 2001260212 in the name of GlaxoSmithKline Consumer Healthcare Investments (Ireland) (No. 2) Ltd (“the Patent”).

What is interesting about this case is that the discovery and inspection order was obtained on the basis of the actual or anticipated promotion of Pharmacor’s products to pharmacists and consumers. GSK’s arguments relating to Pharmacor’s alleged misrepresentations to the TGA and potential infringement of the Patent failed.

This Decision is relevant to pharmaceutical companies seeking to protect their Patent Rights in Australia.  It is also relevant to generic pharmaceutical companies who are preparing to enter the market and planning their marketing and promotion efforts accordingly.

Background

The Patent relates to bilayer sustained release oral paracetamol tablet with a stipulated dissolution rate.  GSK, an exclusive licensee, had been marketing and supplying two products in Australia, which are covered by the Patent: Panadol Back and Neck Long-Lasting, and Panadol Osteo, since 2001 and 2005, respectively. Until about October 2012, the GSK products were the only modified release paracetamol products registered on the Australian Register of Therapeutic Goods (“ARTG”).

Pharmacor registered the Pharmacor Products on the ARTG and applied to have the products listed on the Schedule of Pharmaceutical Benefits (“PBS”).

GSK applied to the Federal Court for an Order of discovery and inspection, asserting that it did not have sufficient information to decide whether or not to commence Patent Infringement Proceedings against Pharmacor.  GSK contended that there was reasonable cause to believe that it had a right to obtain relief and that Pharmacor had misrepresented the bioequivalence of its products to the TGA, had passed off its products to pharmacists and consumers as bioequivalent to Panadol Osteo and that Pharmacor’s actions constituted potential infringement of the Claims of the Patent.

Pharmacor argued that the Pharmacor Products were bioequivalent to Panadol Osteo, but that they were differently formulated, such that they do not infringe any of the Claims of the Patent.

In response, GSK argued that if the Pharmacor Products were not bioequivalent to Panadol Osteo, then they would be unlikely to provide adequate therapeutic plasma concentrations for the required eight hours, leading to consumer confusion and potentially resulting in the undesirable use of higher doses.

The Court held that:

• There was no reason to believe that Pharmacor had made any misrepresentations to the TGA or that there had been any mischaracterisation of bioequivalence of the Pharmacor Products to the TGA.
• The specification of the Patent demonstrated that there can be bioequivalence between two products, which demonstrate different pharmacokinetic properties.  GSK was considered to have failed to establish the requisite belief in relation to the potential Patent infringement claims.
• There was a reasonable belief that Panadol Osteo has different therapeutic effects to the Pharmacor Products and accordingly, that the promotion and representations by Pharmacor to pharmacists and consumers regarding “bioequivalence as approved by the TGA” or “brand equivalents as approved”, without disclosing the relevant differences, may constitute misleading or deceptive conduct.

GSK was thus considered to be entitled to an order for preliminary discovery in relation to Pharmacor’s representations or “half-truth scenario” under the Australian Consumer Law.

Take-home message

Where a Patent infringer has applied to the TGA for registration of a generic product demonstrating bioequivalence to another product, and claims to avoid infringement of an Australian Patent for that product due to formulation and/or pharmacokinetic differences, then any representations to the public of bioequivalence or “brand equivalence” may constitute misleading and deceptive conduct.

Patent owners in Australia for inventions in the pharmaceutical industry can look to this Decision as support for obtaining a Court Order for discovery and inspection of documents and pharmaceutical samples from potential infringers.  However, such an Order may be more easily obtained under Australian Consumer Law on the basis of misrepresentations of bioequivalence made by the potential infringer, if any, to customers and pharmacists than on a claim of potential Patent infringement.