14 January, 2018
2018 saw some significant developments in Australian intellectual property cases including guidance in respect of the deceptive similarity of trade marks; the first judicial consideration of quantification of a claim on the undertaking as to damages in patent disputes; a number of decisions concerning patentable subject matter; and legislative reform arising out of the Productivity Commission Report.
In this wrap up of the year, we outline some of the key developments in 2018 and make some predictions for areas to watch in 2019.
A role for reputation in deceptive similarity?
In the recent decision in Australian Meat Group Pty Ltd v JBS Australia Pty Limited [2018] FCAFC 207, the Full Court of the Federal Court considered the relevance of reputation of registered trade marks, in the context of overturning the primary judge's findings that allegedly infringing marks used by Australian Meat Group were deceptively similar to registered marks.
The Full Court held that the primary judge was impermissibly influenced by the reputation he found to exist in each of the registered marks and allowed the appeal. Importantly, the Full Court held that the decision in Registrar of Trade Marks v Woolworths stood for the "…proposition that deceptive similarity from imperfect recollection might be countered by showing the well-known nature of the registered mark and the lessened likelihood of imperfect recollection." The Full Court declined to engage in any reconsideration of the authorities in relation to deceptive similarity, including Woolworths, on the basis that the argument was raised too late in the proceedings.
Biosimilars in court
In September 2018, the Federal Court granted the first interlocutory injunction in Australia to restrain the launch of a biosimilar product (F. Hoffman-La Roche AG v Sandoz Pty Limited [2018] FCA 874). The product at issue was Sandoz's RIXYMIO, a biosimilar of rituximab, marketed by Roche under the name MABTHERA. The Court held that Roche had a prima facie case of patent infringement and it could not be concluded on a provisional basis that invalidity arguments made by Sandoz were sufficiently strong to qualify it. As to the balance of convenience, the Court considered that there would be complexities in calculating potential losses by both Roche (if the injunction was not granted and the patents were held valid and infringed) and Sandoz (if the injunction was granted and the patents were ultimately revoked). However, the overall balance was found to favour granting an injunction to preserve the status quo until 11 August 2019, being the date of expiry of the first of the Roche patents. The substantive hearing in the matter is scheduled for June 2019.
More recently, just before Christmas, the Court dismissed an application by Sanofi for an interlocutory injunction against Alphapharm to restrain infringement of patents relating to an injector pen for SEMGLEE, a biosimilar of Sanofi's insulin glargine product LANTUS, and to require Alphapharm to withdraw its application for listing of the injector pen on the Pharmaceutical Benefits Scheme (Sanofi-Aventis Deutschland GmbH v Alphapharm Pty Ltd (No 3) [2018] FCA 2060). The Court determined that there was a sufficiently strong lack of novelty case to qualify Sanofi's prima facie case of infringement. Further, the Court found that while the balance of convenience was "quite evenly balanced", the harm suffered by Alphapharm, if an injunction was to be wrongly granted, would be less readily compensated by an award of damages than for Sanofi, if an injunction was not granted.
Damages in pharmaceutical patent disputes
The decision in Sigma Pharmaceuticals (Australia) Pty Ltd v Wyeth was the first of its kind in Australia. Justice Jagot ordered that Wyeth must pay compensation to three generic companies and associated manufacturers/suppliers for lost opportunities suffered as a result of the "usual undertaking as to damages" given in respect of interlocutory injunctions for threatened patent infringement which were later held to be wrongly granted. The decision confirms that parties who were not the subject of an interlocutory injunction may be entitled to damages under the "usual undertaking" if they can demonstrate that they were "adversely affected" by the interlocutory injunction and their loss was reasonably foreseeable at the time the injunction was granted.
Substantial consideration was given during 2018 to the quantification of damages for infringement of pharmaceutical patents in Generic Health Pty Ltd v Bayer Pharma Aktiengesellschaft [2018] FCAFC 183 and H. Lundbeck A/S v Sandoz Pty Ltd [2018] FCA 1797. In each of these cases, a discount to the damages awarded was applied to reflect the fact that the assessment of a lost opportunity to sell products at a certain price, but for the infringing conduct, inevitably involves an estimation and not a certainty.
Perhaps significantly, in Lundbeck, Justice Jagot commented that it was far easier for Lundbeck to prove the value of its loss on the basis of the generics having entered the market than it was for the generics in Sigma v Wyeth to prove the value of their loss on the basis that they were wrongfully held out of the market. In Hoffman-La Roche v Sandoz, in determining that the balance of convenience in relation to irreparable harm in that case was "finely tuned", Justice Burley also commented on the "complexities" that would be involved if Sandoz was required to establish a claim on the undertaking as to damages. Similar comments regarding the difficulties in calculating harm upon the wrongful grant of an interlocutory injunction were repeated in Sanofi-Aventis Deutschland v Alphapharm (discussed above).
For further information, please contact:
Richard Gough, Partner, Baker & McKenzie
richard.gough@bakermckenzie.com
