Court invokes "fairness in the administration of the patent system" in rejecting late challenge to patent extension

We are grateful to Antony Taubman (WIPO) for drawing our attention to a decision of the Federal Court of Australia last week, Interpharma Pty Ltd v Commissioner of Patents [2008] FCA 1283.

In short, what happened here was that Lilly held a patent in Australia for difluro nucleoside antivirals. In 2000 Lilly sought and the Commissioner of Patents granted an extension of term for a period of five years ending in March 2009, based on the registrations in the Australian Register of Therapeutic Goods (ARTG) of the commercial product Gemcitabine hydrochloride, approved for use in the treatment of cancer of the lung and pancreas.

Interpharma objected that there was a disconformity between the product registered in the ARTG and that described in Lilly's patent specification. Accordingly Interpharma sought (i) to have the Commissioner's decision to extend the patent set aside and removed from the patent register, (ii) revocation of the patent itself and (iii) damages for false representation under the Trade Practices Act 1974. Lilly cross-claimed for infringement.

Sundberg J dismissed Interpharma's application in its entirety. The claim based on a false representation under the Trade Practices Act 1974 had to fail because that Act only applied in respect of statements made to those with whom one has, or may have, dealings in the course of commerce; this was not the relationship between Lilly and the Commissioner. Interpharma also failed to establish that it was a "person aggrieved" under the Administrative Decisions (Judicial review) Act 1977 with locus standi to challenge the Commissioner's decision since, on the facts, it was not in a position to make the patented product itself. Interpharma's application was also fatally delayed, even if allowance was made for the fact that the company was not incorporated until two years after the decision to extend the patent was taken. The judge concluded, at paragraphs 39 to 40:

"39 Another relevant matter in relation to delay is that the term of a patent is not of interest only to the patentee. As Lilly points out, it is effectively a right in rem, and of significance to all in the patent area who might be interested in trading within or near the subject matter of the patent. For this reason, the Commissioner must publish in the Official Journal a notice that an extension application has been made and is open to public inspection. If an application for extension is accepted, the Commissioner must publish a notice to that effect in the Official Journal. Provision is made for opposition proceedings. If the Commissioner grants an extension, a notice of the grant must be published in the Official Journal. ...

40 I agree with Lilly that once the opposition period has expired and an extension is granted, the patentee and third parties are prima facie entitled to proceed on the basis of the extension. Admittedly, one must take into account that the applicant was not incorporated until nearly two years after the extension. Nevertheless, the public interest to which I have referred is relevant notwithstanding that. As a matter of fairness in the administration of the patent system, it would be extraordinary if extensions could be challenged some eight years after grant. Even taking into account the applicant’s date of incorporation, it would still be extraordinary that a challenge could be made six years after that".