Not with a Bang but a Whimper – The End of the Pharmaceutical Patents Review

Declan McKeveney

By Declan McKeveney

In what has been a particularly busy couple of years in terms of reviews and changes to the patent system in Australia one of the major reviews of interest to the pharmaceutical industry has bitten the dust.

In late 2012 the then Australian government announced a review of pharmaceutical patents. The review had the broad remit of examining whether Australia’s patent system is effective in securing timely access to competitively priced pharmaceuticals and in supporting innovation and employment in the industry. The review particularly focused on the pharmaceutical extension of term provisions.

A draft report was released in April 2013 with a raft of proposals which drew considerable criticism from the research-based pharmaceutical industry. Some of the more notable proposals included (i) replacing the pharmaceutical extension of term regime with a direct subsidy to provide an incentive to companies to carry out R&D within Australia or, if the regime was maintained, to consider limiting the extension of term such that it would expire no later than the term provided for in other key jurisdictions such as the U.S. or U.K.; (ii) a manufacture for export exemption from patent infringement; (iii) clarifying that it would be an appropriate defence to allegations of contributory infringement if a supplier labels their product so as to carve out infringing uses (note that the perceived need for such clarification has been tempered by the recent High Court decision of Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd [2013] HCA 50); and (iv) establishment of a database, similar to the Orange book of the U.S. FDA, to identify the relationship between pharmaceutical products and the corresponding patent.

Submissions from the public and interested parties were required by the end of April 2013 and the matter then rested with the government to consider the recommendations of the panel. The small matter of an election and a change in government ensured the review stayed firmly on the back burner with the closing of the review’s dedicated website adding to the feeling that it was no longer a priority. Speculation continued that the new government would not want to take ownership of a review initiated by the previous government but, especially given the potential significance of certain of the recommendations for both the local and international research-based and generic pharmaceutical industries, the disappointing lack of certainty remained.

The current government has finally ‘spoken out’ on the matter albeit by virtue of an answer in writing rather than a more prominent announcement. On 09 December 2013 MP Melissa Parke submitted a ‘Question in Writing’ to the Minister for Industry, Mr Ian Macfarlane, asking “By what date will he release the final report of the 2012 Pharmaceutical Patents Review, and is he considering the draft recommendations released in April 2013”. Mr. Macfarlane responded on 11 February 2014 by stating that, firstly, “The government has no plans to release the final report at this stage” and, secondly, “The government is not considering the recommendations made by the panel in the draft report”.

It would seem then that the review has died a natural death and one that is unlikely to be mourned by many in the research-based pharmaceutical industry. Many generic manufacturers will, however, see this as an opportunity lost to implement a number of provisions which would have unquestionably favoured their industry.