Alphapharm Pty Ltd v H Lundbeck A/S - [2008] FCA 559 - FCA 2008 case summary — Zoe

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Alphapharm Pty Ltd v H Lundbeck A/S

[2008] FCA 559

Federal Court of Australia|2008-07-01

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Court

Federal Court of Australia

Decision date

2008-07-01

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Judgment (81 paragraphs)

[1]

Introduction 427 Section 138(3) of the Act provides that the Court may revoke a patent, either wholly or so far as it relates to a claim, on, relevantly, the ground "that the invention is not a patentable invention" (para (b)). The notion of a "patentable invention" is defined in s 18. One essential criterion is that the invention "is a manner of manufacture within the meaning of s 6 of the Statute of Monopolies" (para (a) of s 18(1)). 428 The expression "invention" is defined in Schedule 1 of the Act to mean: any manner of new manufacture the subject of letters patent and grant of privilege within section 6 of the Statute of Monopolies, and includes an alleged invention. 429 It has been held that the concluding words "and includes an alleged invention" qualify only the word "new": NV Philips Gloeilampenfabrieken v Mirabella International Pty Ltd (1995) 183 CLR 655 (Philips v Mirabella) at 662. Accordingly, provided "newness" is alleged, the expression "manner of new manufacture" can be regarded as synonymous with "manner of manufacture," that is to say, the words "and includes an alleged invention" enable newness as an objective fact to be eliminated from consideration. 430 In determining whether what is claimed fits the description of a "manner of manufacture", one must confine one's attention to the face of the specification: Philips v Mirabella at 663-664; Advanced Building Systems Pty Ltd v Ramset Fasteners (Aust) Pty Ltd (1998)194 CLR 171 (Ramset) at [38]; CCOM Pty Ltd v Jiejing Pty Ltd (1994) 51 FCR 260 (CCOM v Jiejing) at 291). The notion of a manner of manufacture does not incorporate considerations of novelty or inventiveness which are dealt with independently and comprehensively in s 18(1)(b), s 7, and the definitions of "prior art base" and "prior art information" in Sch 1: see Ramset at [30]-[34] (dealing with s 100 of the 1952 Act). 431 Alphapharm submits that in relation to the new manner of manufacture criterion, the case is one of a "mere desideratum" (the expression "a mere method or mere idea or mere desideratum" was used in Burroughs Corporation (Perkins's Application) [1974] RPC 147). Senior counsel for Alphapharm frankly conceded that, in a sense, Alphapharm's submission in this respect rose no higher than its case on obviousness. Indeed, he conceded that it was more confined than that case because the character of a manner of manufacture must appear on the face of the specification, and common general knowledge cannot be taken into account as it can in the context of obviousness. 432 In Philips v Mirabella,the High Court held that s 18(1)(a) refers to "a process which is a proper subject matter of letters patent according to traditional principle" (at 667). That "traditional principle" has been described as "the body of case law that has accumulated governing what kinds of things can be the subject of valid patents": Bodkin C, Patent Law in Australia (Thomson Lawbook Co, 2008) at [2040]. 433 I must ask myself, therefore, whether the Patent specification, lays claim to an invention falling within or outside "traditional principle". 434 In para 4 of its further amended particulars of invalidity, Alphapharm gives the following particulars of its contention that the alleged invention as claimed in each claim is not a patentable invention because it is not a manner of manufacture within the meaning of s 6 of the Statute of Monopolies: (i) The invention claimed in the Patent is a mere discovery of the components of Citalopram that were disclosed in the Citalopram Patent; (ii) There is no invention disclosed on the face of the specification; (iii) The specification discloses no barrier crossed or advantage achieved over the disclosure of the Citalopram Patent; (iv) Insofar as the Respondent contends that the alleged invention as claimed in claims 1-5 of the Patent is a selection of the invention claimed in the Citalopram Patent, that selection discloses no substantial advantage over the invention claimed in the Citalopram Patent; (v) The alleged invention as claimed in claims 1-5 of the Patent consisted merely of a known substance the known properties of which made it suitable for use. The known substance was Citalopram. The known use of Citalopram was as a 5-HT reuptake inhibitor. Its known properties were: (a) that Citalopram contains an asymmetric carbon; (b) that Citalopram is a racemic compound; (c) that Citalopram is comprised of two enantiomers, namely, (+)- Citalopram and (-)-Citalopram; (d) that (+)-Citalopram and (-)-Citalopram have different pharmacological activity; (e) that pharmaceutically acceptable salts of (+)-Citalopram could be formed; or (vi) The alleged invention as claimed in claim 6(b) was a mere new use of known processes. The known processes were: (a) the use of enantiomers of optically active acids to afford pure diastereomeric salts; (b) performing stereoselective ring closure using a labile ester (such as methanesulfonyl chloride) with the simultaneous addition of a base (such as triethylamine) in an inert organic solvent (such as dichloromethane). Lundbeck did not advance a "selection" case, and so particular (iv) may be put to one side. Most of the particulars relate to the product claims: only particular (vi) relates expressly to the method claim. 435 Alphapharm relies on the fact that the Patent specification refers to the US Citalopram Patent and the US Diol Patent and so imports their contents. In substance, Alphapharm submits that in the light of the importation of the content of the US Citalopram Patent in particular, the Patent specification does not claim a manner of manufacture but claims as a desideratum the (+)-enantiomer that was indirectly disclosed in the various Citalopram Patents. 436 The enantiomer (+)-citalopram is, however, a new compound with properties previously unknown. The Patent specification does not acknowledge, expressly or by implication, that the (+)-enantiomer is a compound with known properties. On the contrary, it claims that the (+)-enantiomer is an independently existing molecule that has unexpected and surprising properties that could not have been predicted from the properties that citalopram was known to have. 437 It is useful, I suggest, again to consider the analogies given at Section C [121]-[123]. The imperfection of the analogies is demonstrated in the context of manner of manufacture, because the colours blue and yellow (and the black stick figure) already exist and their properties are already known. While a method for extracting blue or yellow from green (or the black stick figure from the solid black square) might be valid as a method claim, a product claim to the colour blue or the colour yellow (or the black stick figure) would fail the manner of manufacture test because it would be a claim to something that already had an independent existence and the properties of which were already known. 438 The enantiomer (+)-citalopram is different. It had never been an independently existing molecule and, apart from the fact that, by reason of its definition, it rotated plane-polarised light to the right, its properties were unknown. 439 For the above reasons, the product claims are claims of a manner of new manufacture. 440 Claim 6, the method claim, does not fall outside the notion of a "manner of new manufacture" either and I do not understand Alphapharm to have addressed independent submissions to the contrary, notwithstanding particular (vi). 441 The Patent should not be revoked on the ground that the invention claimed is not a patentable invention.

[3]

If I should find that claim 1 and dependent claims are not for (+)-citalopram on a molecular level, the claims do not define the alleged invention because they could include any mixture of enantiomers in the absolute configurations of S-citalopram and R-citalopram in any proportion ranging from 51% to 100%. 444 In the case of citalopram, the (+)-enantiomer is now known to be the S-enantiomer, that is to say, it is the S-enantiomer that causes plane-polarised light to rotate to the right (clockwise). 445 Professor Davies said that the determination of rotation and of the extent of it is "measured at the sodium D-line" in a "standard solvent under standard conditions", and that there is a convention according to which a reference to the (+)-enantiomer assumes that form of measurement under those conditions. He said that in the literature, there can be found a very small percentage of specific rotations that are not quoted according to those criteria, and that there is normally a particular reason for a departure from them (such as, "because the compound solution is coloured and absorbs at the sodium D-line"). He thought that perhaps in 2% of cases, the measurement was not made at the sodium D-line and said that in those cases it is always specified at which different wavelength they were measured. In the present case, the specification identified the solvent as methanol. In answer to the question whether, under different conditions, the same enantiomer might rotate light differently, Professor Davies said that there are "very rare" examples in which the enantiomer rotates light differently according to the solvent used. There is no suggestion in the evidence that citalopramis such a "very rare" case. 446 In my opinion, there is no substance in Alphapharm's first ground of attack. When the specification refers to the (+)-enantiomer of citalopram, it is referring to the enantiomer of citalopram that rotates plane-polarised light to the right when measured at the sodium D-line when methanol is the solvent used and standard conditions apply. In these circumstances, and in the light of what we now know, the reference to the (+)-enantiomer was in fact unmistakably a reference to the enantiomer that is the S-enantiomer, even though the claim did not and could not say so. This view is not displaced by the evidence of Professor Davies to which I referred to the general effect that in the case of some racemic mixtures (not citalopram) and perhaps in a non-standard solvent and measured against a wavelength other than the sodium D-line, the S-enantiomer may rotate plane-polarised light to the left. 447 There is no substance either in the second ground of attack because I have held that the claims are specifically in respect of the (+)-enantiomer as an independent molecule, not to it merely as part of an unresolved racemate.

[4]

SECTION H - LACK OF FAIR BASING - s 40(3) OF THE ACT 448 Section 40(3) of the Act requires that the claims be "fairly based on the matter described in the specification." A comparison between the claims and the rest of the specification is called for. 449 What is required is that there be a real and reasonably clear disclosure in the body of the specification, taken as a whole, of the invention that is claimed in the claims so that those who may wish to exploit the invention as claimed after the patent has expired will be enabled to do so: see, for example, Société Des Usines Chimiques Rhône-Poulenc v Commissioner of Patents (1958) 100 CLR 5 at 11 per Fullagar J; F Hoffman-La Roche & Co AG v Commissioner of Patents (1971) 123 CLR 529 at 539; CCOM v Jiejing at 281-282; Rehm Pty Ltd v Websters Security Systems (International) Pty Ltd (1988) 11 IPR 289 at 304; Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2004) 217 CLR 274 (Lockwood v Doric) at [69]. 450 In Lockwood v Doric, it was held in relation to the fair basing requirement of s 40(3) that: · all that is essential in assessing a fair basing objection is recourse to the contents of the specification, and there is no call, for example, for an examination (except on construction questions) of common general knowledge (which is essential when an objection based on want of inventive step is being considered), or of prior art (which is essential when a lack of novelty objection is being considered (at [48])); · the fair basing objection is distinct from the other grounds of objection including the failure to describe the invention fully and the failure to claim clearly and succinctly (at [49]); · any question of inventive step, "merit" or "technical contribution to the art" has no place in a consideration of a fair basing (at [50]-[54]); · care should be taken when one is considering authorities decided prior to the introduction of the statutory ancestor of s 40(3) in the United Kingdom by s 4(4) of the Patents Act 1949 (UK) and in Australia by s 40(2) of the 1952 Act (at [55]-[62]). Their Honours referred, in particular, to the danger of relying on Mullard Radio Valve Co Ltd v Philco Radio and Television Corporation of Great Britain Ltd (1936) 53 RPC 323 and Palmer v Dunlop Perdriau Rubber Co Ltd (1937) 59 CLR 30 in the present context; · In 1977 the language of fair basing disappeared from the United Kingdom legislation on its being changed to give effect to the European Patent Convention in favour of a requirement that the claims "be supported by the description" of the invention in the specification (see CCOM v Jiejing at 276), and accordingly cases decided after that date, and in particular Biogen Inc v Medeva plc [1997] RPC 1, are irrelevant (at [63]-[67]); · The requirement that the claim or claims be fairly based on the matter described in the specification is not a requirement that each claim be fairly based on the best method known to the patentee of performing the invention: (at [69]); · The specification as a whole must be regarded and parts which an isolation may appear to point against a "real" disclosure but which are in truth only loose or stray remarks, should be put aside (at [69]). 451 Alphapharm contends that each of claims 3, 4, 5 and 6 of the Patent is not fairly based on matter described in the specification in so far as it claims, or is referable to, a pharmaceutical composition or a method of preparing one, where the pharmaceutical composition is other than for: · use as an anti-depressant; · use as geriatrics; · the cure of obesity; or · the cure of alcoholism. 452 This contention is referable to the statement at page 1 of the specification that the invention relates to the two novel enantiomers of the anti-depressant drug [citalopram] "and to the use of these enantiomers as anti-depressant compounds as well as to the possible use as geriatrics or in the cure of obesity or alcoholism". 453 Alphapharm also apparently founds its fair basis attack on a passage at page 14, lines 26-29 of the specification, that states: The invention also comprises a method for the alleviation, palliation, mitigation or inhibition of the manifestations of certain physiological-psychological abnormalies [sic - abnormalities] of animals, especially depressions by administering to a living animal body, including human beings, an adequate quantity of (+)-citalopram ... 454 The claims were set out at [10] above. It is convenient to repeat here claims 3, 4 and 5 (which, it will be recalled, are product claims) as follows: 3. A pharmaceutical composition in unit dosage form comprising as an active ingredient, a compound as defined in claim 1, together with a pharmaceutically acceptable carrier or excipient. 4. A pharmaceutical composition in unit dosage form comprising, as an active ingredient, the compound of claim 2, together with a pharmaceutically acceptable carrier or excipient. 5. A pharmaceutical composition in unit dosage form, according to claim 3 or 4, wherein the active ingredient is present in an amount from 0.1 to 100 milligram per unit dose, together with a pharmaceutically acceptable carrier or excipient. 455 Claims 3 and 4 claim (+)-citalopram and the pamoic acid salt of (+)-citalopram, respectively, in unit dosage form. The invention of this is disclosed at various points in the body of the specification, including: · page 12, lines 1-6; · page 12, lines 8-10; · page 12, line 19 to page 13 line 30; and · page 14, lines 1-4. 456 None of those disclosures are limited by reference to the treatment of depression, geriatrics, obesity or alcoholism. 457 Claim 5 claims (+)-citalopram and its pamoic acid salt in unit dosage form in a dose range from 0.1 to 100 mg. Disclosure of this occurs in the body of the specification, including at: · page 12, lines 8-13; · page 12, line 21 to page 13, line 30; and · page 14, lines 30-33. 458 Again, none of these disclosures are limited by reference to the treatment of depression, geriatrics, obesity or alcoholism. 459 I do not think that the fact that it is stated on p 1 of the specification that the invention "relates to the two novel enantiomers of the anti-depressant drug [citalopram] and to the use of these enantiomers as anti-depressant compounds as well as the possible use as geriatrics or in the cure of obesity or alcoholism" signifies that the disclosure made in the text to follow is limited by reference to the four possible uses mentioned. Similarly, I do not think that the passage at page 14, lines 26-29 quoted above confines the disclosure. On a fair overall view of the specification, the disclosure is of the products claimed in claims 1-5 and the method of claim 6 for the preparation of the compound of claim 1. 460 In my view the claims are fairly based on the disclosure made in the body of the specification.

[6]

SECTION J - INUTILITY - s 18(1)(c) OF THE ACT 466 Section 18(1)(c) of the Act provides that in order to be a patentable invention for the purposes of a standard patent, the invention, so far as claimed in any claim, must be "useful". 467 Alphapharm's further amended particulars of invalidity contain two particulars of inutility: (a) In so far as the alleged invention claimed in claim 5 includes a unit dose containing other than a therapeutically effective amount of (+)-Citalopram, the alleged invention is not useful; (b) Insofar as the invention claimed in claim 1 (and dependent claims) is not limited to the (+)-citalopram enantiomer, that rotates a plane of polarized light to the right in the conditions set out in Examples 1 and 2 of the Patent the claim is not useful and does not meet the promise of the invention because it includes the (R)-citalopram enantiomer of citalopram which is not responsible for 5-HT uptake inhibition; see Patent, page 3 lines 4-5. [emphasis in original] The reference to the Patent, page 3, lines 4-5 is a reference to the following sentence: Furthermore, it was shown to our surprise that the entire 5-HT uptake inhibition resided in the (+)-citalopram enantiomer. 468 There is a principle that all that is within the scope of a claim must be useful if the claim is not to fail for inutility, or, to express the matter differently, a claim is bad if it covers means that will not produce the desired result even if a skilful person would know which means to avoid: Wm Wrigley Jr Company v Cadbury Schweppes Pty Ltd (2006) 66 IPR 298 at [138] and authorities there cited. 469 Alphapharm relies on the testimony of Professor Montgomery who was asked what the highest therapeutically useful unit dose of escitalopram was. He said that it was 20 mg of escitalopram, but that in treating obsessive compulsive disorder (OCD) clinicians normally use above that level, and that unit dosages of 30 mg and 40 mg are often used in the treatment of resistant OCD. 470 Professor Montgomery was also asked what would be the minimum useful dose. He said that 5 mg was found to be effective in the treatment of social anxiety disorder in a very large study, but that that amount was found to be ineffective in the treatment of generalised anxiety disorder. He said that there is a general notion that one should use lower doses in the case of the elderly, and that the 5 mg dose is used for the treatment of them. 471 Alphapharm submits that this evidence demonstrates that the claimed range of 0.1 to 100 mg per unit dose includes quantities below the useful minimum of 5 mg and above the useful maximum of 40 mg. Accordingly, so Alphapharm's submission goes, claim 5 lacks utility because it claims quantities outside the "useful" range. 472 I agree. Claim 5 cannot be saved by implying any minimum or maximum of the kind of which Professor Montgomery gave evidence. To do so would be inconsistent with the claim as framed and would amount to an amendment of it. 473 In relation to claim 1, I have concluded earlier that that claim is limited to (+)-citalopram in its absolute configuration as S-citalopram. Accordingly as Alphapharm accepts, this takes away the basis of its second ground of attack for inutility. 474 In my view, claim 5 fails for inutility and the Patent should be revoked so far as it relates to claim 5 on the ground that the invention, so far as claimed in claim 5, is not a patentable invention because it is not useful within the meaning of s 18(1)(c) of the Act.

[8]

Introduction 475 I referred to the provisions of the Act relating to the extension of the terms of patents (ss 67, 68, 70, 71, 74-76 and 77) at [16] - [21], outlined the circumstances of the extension of the term of the Patent at [27] - [33], and discussed the Lundbeck Appeal (Extension of Term) Proceeding at [45] - [53]. I will not repeat what I have said in those passages. 476 It will be recalled that Cipramil (citalopram hydrobromide) was included in the ARTG on 9 December 1997, and that Lexapro (escitalopram oxalate) was included in the ARTG on 16 September 2003. 477 As foreshadowed at [15] above, the same issues arise in relation to Alphapharm's and Arrow's applications under s 192 of the Act for rectification of the Register to remove particulars of the extension of the term, as arise in relation to the Lundbeck Appeal (Extension of Term) Proceeding. 478 Alphapharm has pending an application before the TGA for the purpose of enabling it to market a therapeutic good containing escitalopram oxalate. Therefore, Lundbeck concedes that Alphapharm is a "person aggrieved" within the meaning of s 192 of the Act and so has standing under that section to apply for rectification of the Register. 479 The position of Arrow is different. The particulars to para 15 of Arrow's statement of claim state that Arrow wishes to market a product in Australia containing (+)-citalopram. Affidavit evidence served by Arrow on the day prior to the commencement of the trial did not take matters much further. That evidence was to the effect that Arrow intends to market and sell in Australia a generic pharmaceutical product containing (+)-citalopram upon the expiry or earlier revocation of the Patent. 480 Lundbeck does not concede that such an intention gives Arrow standing as a "person aggrieved" for the purposes of s 192. However, Lundbeck accepts that in the light of the fact that Alphapharm and Arrow have joined cause in relation to the granting of the extension and the entry of particulars in the Register, "the issue is somewhat moot". 481 Alphapharm and Arrow submit that Cipramil is "goods that contain, or consist of, the [pharmaceutical] substance" within the meaning of s 70(5) of the Act, that is to say, that Cipramil is goods that contain or consist of (+)-citalopram or S-citalopram or escitalopram (they do not distinguish between the three) which, they say, is the pharmaceutical substance per se that was disclosed in the complete specification of the Patent and fell within its claims. 482 Much of the argument at the heart of the present Section K and of the following Section L is semantic. The (+)-enantiomer of citalopram is a pharmaceutical substance of which Lexapro consists or which it contains. That enantiomer provides the therapeutic use of Lexapro (see the definitions of "pharmaceutical substance" and "therapeutic use" set out at [486] below). Lundbeck submits, however, that it is incorrect to say that the racemate citalopram, and therefore Cipramil, contains (+)-citalopram. 483 Lundbeck's submissions in support of this position can be regarded as (1) its "one or more pharmaceutical substance per se" submission, and (2) its "contain" submission.

[10]

General 484 I set out the relevant sections in Pt 3 of Ch 6 of the Act at [17] - [21] above. 485 Lundbeck submits that the references to "the substance" or "the pharmaceutical substances" in s 70(3), in the definition of "first regulatory approval date" in s 70(5), in s 71(2)(b) and in s 77(1)(a), all hark back to the expression "one or more pharmaceutical substances per se" in s 70(2)(a). In general terms, the submission is that the expression "one or more pharmaceutical substances per se" in s 70(2)(a) is a reference, in the circumstances of the present case, to nothing other than the separate enantiomer (+)-citalopram. It follows, according to the submission, that the registration of Cipramil did not amount to an inclusion in the ARTG of goods that contained or consisted of the pharmaceutical substance per se, (+)-citalopram. Cipramil, so Lundbeck contends, contains a different pharmaceutical substance per se, being the racemate citalopram. 486 The expression "pharmaceutical substance" is defined in Schedule 1 to the Act to mean, relevantly: a substance (including a mixture or compound of substances) for therapeutic use whose application (or one of whose applications) involves: (a) a chemical interaction, or physio-chemical interaction with a human physiological system; ... The expression "therapeutic use" is defined in Schedule 1 to mean, relevantly: (a) preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury in persons; ... Clearly, both citalopram and (+)-citalopram are pharmaceutical substances. 487 Lundbeck emphasises that s 70(2)(a) requires that the pharmaceutical substance per se be disclosed in the complete specification of the patent and be in substance within the scope of the claim or claims of that patent. It is the enantiomer (+)-citalopram that meets those requirements in the case of the Patent. 488 Lundbeck's contention is that once it is accepted that s 70(2)(a) refers to the (+)-enantiomer only, it must be accepted that Cipramil did not contain that pharmaceutical substance.

[11]

The authorities 489 Lundbeck refers to three authorities as being relevant to the construction of the expression "pharmaceutical substance per se": Boehringer Ingelheim International GmbH v Commissioner of Patents (2001) 112 FCR 595 (Boehringer); Prejay Holdings Ltd v Commissioner of Patents (2003) 57 IPR 424 (Prejay); and Pharmacia Italia SpA v Mayne Pharma Pty Ltd (2006) 69 IPR 1 (Pharmacia). 490 Boehringer is not entirely on point. The patent claims were for a container comprising an aerosol or spray composition for nasal administration. The composition comprised as its active ingredient a certain pharmaceutical substance. The primary Judge, Heerey J, held that s 70(2)(a) was not satisfied because the pharmaceutical substance itself (per se) was not disclosed in the complete specification and did not fall within the scope of a claim of the patent specification (Boehringer Ingelheim International v Commissioner of Patents (2001) AIPC 91-670). His Honour examined the legislative history behind ss 70-79 and concluded that patents for new and inventive processes or new and inventive modes of treatment of old or known products are not the subject of s 70: it is only patents for new and inventive products that are. Accordingly, the expression per se showed that an extension of term is to be available only where the claim is for a pharmaceutical substance as such, not a substance forming part of a method or process. 491 The Full Court in Boehringer agreed (at [37]). Their Honours noted (at [39]) that the Second Reading Speech relating to the Intellectual Property Laws Amendment Bill 1997 (Cth), which inserted the relevant sections into the Act, spoke of "development of a new drug" and of the research and testing required before a "product" could enter the market. Their Honours also noted (at [40]) that the Explanatory Memorandum relating to that Bill spoke of the expression "pharmaceutical substance per se" as being usually restricted to "new and inventive substances". They considered that the expression "fall within the scope of the claim or claims of that specification" in s 70(2)(a) means "[b]e included amongst the things claimed " (at [42]). 492 The decision in Boehringer does not govern the present case because claims 1 to 5 are indisputably product claims, and the pharmaceutical substance per se in question is indisputably the (+)-enantiomer of citalopram. 493 In my view, Lundbeck seeks to draw more from the expression "per se" than was necessary in Boehringer. In Boehringer, the Court was concerned only to distinguish between a pharmaceutical substance that is the subject of a product claim (which they held to be within s 70(2)(a)) and a substance that forms part of a method or process claim (which they held not to be within s 70(2)(a)). The Court was not concerned, as I am, with a competition between two arguable "first regulatory approval dates" and with the question whether the substance the subject of a product claim in a later patent was contained in goods previously included in the ARTG. 494 In Prejay a Full Court of this Court followed Boehringer. All of the claims were method claims, not product claims. The Commissioner's delegate refused an application for an extension. The Full Court agreed with the delegate that a substance that is mentioned in the context of a method claim does not meet the requirement of s 70(2)(a) that the substance per se fall within the scope of a claim (at [23] - [24] per Wilcox and Cooper JJ, [28] per Allsop J). 495 In Pharmacia, Weinberg J accepted the distinction drawn in Boehringer, but held (at [99]) that claim 1 of the patent before him did state "a claim to a new and inventive substance, and not to a novel process or method". Weinberg J was also not concerned with rival first regulatory approval dates or with the associated questions that are before me. 496 For its part, Alphapharm relies on Merck & Co Inc v Arrow Pharmaceuticals Ltd (2003) 59 IPR 226 (Merck). A patentee, Merck & Co Inc (Merck), appealed against the Commissioner's delegate's refusal of an extension. The appeal was undefended, the respondent having withdrawn from the proceeding. Wilcox J allowed the appeal. 497 Sankyo Company Pty Ltd (Sankyo) had held a patent that claimed a compound of a particular formula, commonly referred to as Lovastatin. Lovastatin was entered on the ARTG. It was used for the control of cholesterol levels. Sankyo's patent expired on 19 February 2000, and no extension was sought in respect of it. 498 Merck applied for a patent on 3 June 1980 with priority dates in 1979 and 1980. The patent was granted on the basis of the exclusion of certain claims which related to Lovastatin. 499 Immediately after the expiration of Sankyo's patent, Merck applied to the TGA for listing on the ARTG of a product called "Mevacor". Listing occurred some four weeks later. After the listing, Merck applied for an extension of the term of its patent. 500 Before the delegate, Merck argued for the extension on two bases: first, that the relevant pharmaceutical substance was Lovastatin, and, second, that it was lovastatin beta-hydroxy acid (LHA). In relation to the former ground, Merck faced the difficulty that the claims relating to Lovastatin had been excluded from the claims of the patent as granted. The delegate therefore held that Lovastatin was not a pharmaceutical substance per se that was disclosed in the complete specification of Merck's patent and fell within the scope of any claim of that specification. 501 In relation to Merck's alternative argument concerning LHA, the delegate accepted that LHA was a pharmaceutical substance per se disclosed in the complete specification of Merck's patent and that LHA fell within the claims of that specification, and so satisfied s 70(2)(a) of the Act. The question that then arose was whether Lovastatin consisted of or contained LHA. 502 The delegate concluded that Lovastatin did contain LHA, but only as an impurity, and that this did not satisfy s 70(3)(a). 503 On appeal, Wilcox J disagreed, saying (at [25]) that Merck's LHA argument was "irrefutable", and that, if only on that ground, the delegate's decision must be reversed. 504 His Honour stated (at [26]) that LHA was a pharmaceutical substance per se disclosed in the complete specification of the patent and falling within its claims, and that the undisputed evidence was that Mevacor contained LHA. 505 Wilcox J considered that it was irrelevant whether or not LHA itself was included in the ARTG: that for s 70(3)(a) purposes it was enough that it was contained in some other good (Mevacor) that was included in the ARTG (at [27]). His Honour thought that it did not matter that LHA was present in Mevacor only in minute quantities (at [28]). 506 Having regard to his conclusions supporting Merck's LHA argument, his Honour did not need to address its argument concerning Lovastatin, although he expressed the view that it seemed to him that the delegate had been right to reject that argument. 507 In Merck,as in the other cases referred to above, the question before the Court did not concern a competition between two arguable first regulatory approval dates. However, Wilcox J's construction of "containing" in s 70(3) must be applicable to the word "contain" in s 70(5). If I were to follow Wilcox J, I would hold that Cipramil "contained" (+)-citalopram. Consideration of Lundbeck's "pharmaceutical substance per se" submission 508 The Latin expression "per se" means "by or in itself; intrinsically. Opposed to PER ACCIDENS [defined relevantly to mean "By virtue of some non-essential circumstance; contingently, indirectly"]": Oxford Dictionary of Foreign Words and Phrases (OUP, 1997). It is not every disclosure of every substance falling within the definition of "pharmaceutical substance" to which s 70(2)(a) refers. A non-essential or incidental disclosure of a pharmaceutical substance will not satisfy s 70(2)(a). The pharmaceutical substance must be of the essence of a disclosure made in the specification. This construction is consistent with the requirement that it fall within the scope of the claim or claims. 509 The racemate, citalopram, is the pharmaceutical substance per se disclosed inthe specification of the Australian Citalopram Patent, whereas the (+)-enantiomer of that racemate is the pharmaceutical substance per se disclosed in the specification of the Patent, in each case for the purpose of s 70(2)(a). Moreover, the inclusion in the ARTG of Cipramil on 9 December 1997 clearly signified the inclusion in the ARTG of goods that consisted of or contained the pharmaceutical substance citalopram, and the inclusion of Lexapro in the ARTG on 16 September 2003 clearly signified the inclusion in the ARTG of goods that consisted of or contained the pharmaceutical substance (+)-citalopram, in each case for the purpose of s 70(3)(a). The precise question before the Court, however, is whether Cipramil was goods that contained the pharmaceutical substance (+)-citalopram for the latter purpose. 510 The "substance" or "pharmaceutical substances" referred to in ss 70(3)(a), 70(5), 71(2)(b) and 77(1)(a) refer to the "one or more pharmaceutical substances" referred to in s 70(2)(a), but I do not think that the expression "per se" carries over into those provisions, otherwise the Parliament would have used it again in them. Parliament did in fact use it again in s 78(2)(a) - again in respect of the disclosure in the complete specification of a patent. The disclosure in the complete specification of which s 70(2)(a) speaks is different from the notions of "inclusion", "containing" and "consisting of" that are referable to the ARTG which are addressed in the later provisions. The omission of "per se" from those later provisions suggests that it is to suffice that the goods that are included in the ARTG "contain" only non-essentially or incidentally the pharmaceutical substance that is required to be disclosed per se in the complete specification. In my view, the per se qualification has done its work once the pharmaceutical substance disclosed in the complete specification has been identified. Thereafter, the question is the simple one whether the goods included in the ARTG contain or consist of that pharmaceutical substance, unencumbered by any per se notion. 511 However, Lundbeck further submits that the definition of "pharmaceutical substance" (with the associated definition of "therapeutic use") in Schedule 1 (see [486] above) itself and without more signifies that Cipramil does not contain (+)-citalopram. 512 I do not accept this submission either. Both (+)-citalopram and racemic citalopram are for a therapeutic use which is of the same kind in each case. Indeed, the therapeutic benefit of citalopram comes from the presence in it of (+)-citalopram. It would not be right to say that Cipramil does not contain (+)-citalopram merely because the therapeutic effect of the racemate is less effective because of the additional presence in it of (-)-citalopram.

[12]

(2) Lundbeck's "contain" submission 513 There is overlap between Lundbeck's "pharmaceutical substance per se" submission and its "contain" submission. In its "contain" submission, Lundbeck seeks to emphasise the different properties of citalopram and (+)-citalopram for the purpose of showing the "inappropriateness" of regarding the former as containing the latter. I will first summarise, in turn, the various aspects of Lundbeck's "contain" submission. It is not appropriate to say that citalopram "contains" (+)-citalopram because they are both new chemical entities (the New Chemical Entities Submission) 514 The earlier (9 December 1997) registration was of CIPRAMIL Citalopram hydrobromide. The later registration (16 September 2003) was of LEXAPRO escitalopram (as oxalate). 515 Lundbeck points to the fact that escitalopram oxalate (Lexapro) was approved as a "new chemical entity" by the TGA. The evidence shows that the TGA adopted the guidelines "Investigation of Chiral Active Substances" used in the European Union (the legislative basis is Directive 75/318/EEC as amended). Section 5.3 of those guidelines deals with the "Development of a new single enantiomer from an approved racemate". The first two paragraphs of section 5.3 are as follows: In principle this concerns the development of a new active substance requiring a complete new application. The decision to develop an enantiomer should be explained. It would be counterproductive in this case not to use data on the corresponding racemate as far as is applicable to the enantiomer. It is thereby assumed that the applicant has the contents of the full dossier on the corresponding racemate at his disposal. Suitable "bridging" studies should be carried out to link the complete racemate data to the incomplete data on the selected enantiomer. The use of racemate results should be explained. The extent of bridging studies should be defined on a case-by-case basis… 516 In the present case, the TGA required of Lundbeck that additional pre-clinical and clinical studies be conducted. 517 The Australian Drug Evaluation Committee (ADEC) resolved at its 229th meeting on 21 August 2003 (Commonwealth of Australia Gazette, No GN 35, 3 September 2003) to advise that there should be approved for registration, inter alia, the following medicine: Escitalopram oxalate - Lexapro Tablets, 5, 10, 15 and 20mg Lundbeck Australia Pty Ltd New Chemical Entity: For the treatment of major depression. 518 Professor Day had been a member of ADEC and participated in its role of advising the TGA about applications for the listing of prescription medicines on the ARTG from 1992 to 1997. Professor Day had a wealth of other experience in the fields of Pharmacology, Clinical Pharmacology, Toxicology, Rheumatology and Therapeutics. At the time of making his affidavit, he was Professor of Clinical Pharmacology in the School of Physiology & Pharmacology and the St Vincent's Clinical School at the University of New South Wales, a position he had held since 1989. He was also Director of the Department of Clinical Pharmacology and Toxicology at St Vincent's and Director of St Vincent's Clinical Trials Centre, positions he had held since 1989 and 1993 respectively. 519 Professor Day stated that in the context of the discussion of listings on the ARTG, he treated "medicine" as meaning the same thing as "pharmaceutical substance" and "chemical entity" as meaning the same thing as the active component of a pharmaceutical substance. He said that a new chemical entity medicine must be a different chemical entity medicine from one that is already registered on the ARTG and that separate registrations for two chemical entity medicines indicates the TGA had taken the view that they are not the same thing. 520 It follows, according to Lundbeck's submission, that s 70 of the Act does not deny Lundbeck an extension of term, because that which has been registered on the ARTG as a new chemical entity cannot be "contained" in something that was already registered on the ARTG. It is not appropriate to say that citalopram "contains" (+)-citalopram because it is not appropriate to say that a racemic mixture contains the (+)-enantiomer (the Rotation of Plane-Polarised Light Submission) 521 The symbol (+) signifies, by definition, that the enantiomer rotates plane-polarised light to the right (clockwise), whereas the symbol (-) signifies, by definition, that the enantiomer rotates plane-polarised light to the left (anti-clockwise). Lundbeck submits, therefore, that it is not appropriate to identify a racemate by reference to the rotation of polarised light: both enantiomers being present in equal proportions, there is no net rotation of plane-polarised light. Therefore, so the submission goes, it is inappropriate to characterise the enantiomers when in racemic form as (+) or (-) or to say that the racemate citalopram contains (+)-citalopram. 522 Elaborating on this submission, Lundbeck contends that the appropriate descriptors of the enantiomers of citalopram when in a racemic mixture are S-citalopram and R-citalopram. Lundbeck accepts that the racemic mixture citalopram contains the molecule S-citalopram (escitalopram), and that when separated from the racemate that enantiomer rotates plane-polarised light to the right, and is therefore then appropriately called (+)-citalopram. 523 So it is that Lundbeck can contend that:

Citalopram (and therefore Cipramil) consists of, or contains in equal parts, S-citalopram (escitalopram) and R-citalopram;
S-citalopram (escitalopram) is (+)-citalopram, and R-citalopram is (-)-citalopram; yet it does not follow that
Citalopram (and therefore Cipramil) consists of, or contains in equal parts, (+)-citalopram and (-)-citalopram. 524 In cross-examination, Professor Davies was careful not to assent to the proposition that the (+)-citalopram was present in the racemate, preferring to state that molecules of the S configuration were present in the racemate. It is not appropriate to say that citalopram "contains" (+)-citalopram because it is not appropriate to say that a racemic mixture contains the (+)-enantiomer in an isolated form (having a purity greater than 95% ) (the Purity Submission) 525 I have previously held that the expression "(+)-citalopram" in the Patent specification refers specifically and distinctively to the single enantiomer, not merely to that enantiomer in the unresolved racemate (see Section C). Lundbeck submits that it would be inconsistent with this view to hold that citalopram contains (+)-citalopram because, in the racemate, it does not exist in the isolated and pure form, but rather at 50% purity. It is not appropriate to say that citalopram "contains" (+)-citalopram because they are different pharmaceutical substances with different physical, chemical, pharmacological and clinical properties and effects (the Different Pharmacological Properties and Effects Submission) 526 In its submissions, Lundbeck discusses separately the physical and chemical properties, the pharmacological properties, and the clinical effects of, respectively, citalopram and escitalopram. 527 One of Lundbeck's submissions highlights the semantic nature of much of the argument. Lundbeck submits: …the physical composition of citalopram and escitalopram is different. One contains equal amounts of each enantiomer and the other contains only a single enantiomer. Depending on the meaning of "enantiomer" here, this statement comes close to a concession by Lundbeck that citalopram contains, to the extent of 50%, the (+)-enantiomer. No doubt, however, Lundbeck was referring to the "S-enantiomer". 528 In relation to the physical and chemical properties of citalopram and escitalopram, Lundbeck points out that the solubility and melting point of the two are different as, of course, is the capacity to rotate plane-polarised light. Lundbeck also points out that the evidence is that the single enantiomer can react with other chiral compounds at a rate different to the rate at which the racemate reacts with them. 529 All that this shows, however, in my opinion, is that the racemate is not one and the same thing as the enantiomer. The statute's use of the alternatives "contain, or consist of" also takes account of this fact. 530 In relation to pharmacological properties, Lundbeck refers to the different physio-chemical interactions with the receptor manifested in different pharmacodynamics and pharmacokinetics. Again, I do not think that these differences resolve the present question. 531 Professor Montgomery, Emeritus Professor of Psychiatry at the Imperial College School of Medicine, University of London, said that it was correct to say that the racemate and the S-enantiomer had "the same active ingredient" only if it was assumed that the other enantiomer, the R-enantiomer was inactive. Professor Montgomery said that he initially made that assumption and for that reason expected that the efficacy of the active enantiomer would be the same as that of the racemate at half the dose. He was surprised that the data from early studies showed that the enantiomer had a different level of efficacy, demonstrating that the R-enantiomer was also active. Lundbeck submits that it is not to the point that the serotonin reuptake inhibitory activity resides in the S-enantiomer: the point is that the R-enantiomer is also active, even though counteractive. 532 In relation to "clinical effects", Lundbeck concedes that the evidence that citalopram and escitalopram have different clinical effects has been disputed. It submits, however, that the uncontested difference between the physical properties and the pharmacology properties in vitro and in animals is sufficient to establish that they are different substances. Consideration of Lundbeck's "contains" submission 533 For its part, Alphapharm emphasises the distinction between the requirements of s 70(2)(a) on the one hand and ss 70(3)(a) and 71(2)(b) on the other hand. That distinction, which I accepted above in the course of dealing with Lundbeck's "pharmaceutical substance per se submission, is between the conditions in s 70(2)(a) that must be satisfied in respect of the disclosure made in a patent for which an extension is sought, on the one hand, and the requirements of ss 70(3)(a) and 71(2)(b) concerning goods included in the ARTG, on the other hand. It is ss 70(3)(a) and 71(2)(b), not s 70(2)(a), that determine whether the 9 December 1997 ARTG registration for Cipramil was a registration of goods containing or consisting of the pharmaceutical substance disclosed in the Patent. The question is simply whether Cipramil contains the (+)-enantiomer of citalopram that was disclosed in the Patent. 534 The word "contain" is an ordinary English word and its meaning is plain. In its conjunction with the alternative "consist of", "contain" means, according to the New Shorter Oxford English Dictionary, "include as a part ... of its substance or content" or "have inside itself". 535 In s 70(5)(a) it is "goods" that are to contain or are to consist of the pharmaceutical substance in question. In this context, "contain" signifies a physical relationship that is something less than "consist of". If goods A consist of B and C, they may be seen to contain B and to contain C, but not to consist of either alone. B and C will also be goods, although they need not be recognised as continuing to have a separate existence. For example, there is no difficulty in saying that a cake "contains" milk and eggs although they are no longer recognised as having a separate existence in the cake. 536 In relation to the New Chemical Entities Submission, I do not think that the TGA's guideline, the resolution of ADEC or the evidence given by Professor Day bear upon the question of the proper construction of the statutory provisions. While (+)-citalopram can be accepted to be a new chemical entity as against the racemate, this does not answer the statutory question whether the latter (or, more precisely, Cipramil) "contains" the former. 537 In response to Lundbeck's reliance on the TGA's guideline and the resolution of ADEC in support of its New Chemical Entities Submission, Alphapharm might just as irrelevantly call in aid statements made by Lundbeck to the TGA in connection with its application to register Lexapro. Alphapharm referred to the fact that Lundbeck had no difficulty in frequently referring to escitalopram as the enantiomer of the racemate citalopram to which the therapeutic activity of citalopram was attributed. In an article "Escitalopram versus citalopram: the surprising role of the R-enantiomer" Psychopharmacology (2004) 174, pp163-176, the authors, Dr Connie Sánchez, Dr Břgesř and other employees of Lundbeck, began their abstract with the statement: Rationale: Citalopram is a racemate consisting of a 1:1 mixture of the R(-)- and S(+)-enantiomers. Non clinical studies show that the serotonin reuptake inhibitory activity of citalopram is attributable to the S-enantiomer, escitalopram. A series of recent non-clinical and clinical studies comparing escitalopram and citalopram to placebo found that equivalent doses of these two drugs, ie containing the same amount of the S-enantiomer, showed better effect of escitalopram. These results suggested that the R-citalopram in citalopram inhibits the effect of the S-enantiomer. The references in this passage are not, however, to the (+) and (-) enantiomers. 538 The Rotation of Plane Polarised Light Submission does not show that the racemate does not contain the (+)-enantiomer. The expression (+)-citalopram refers to a physical thing, a molecule. That molecule's property of rotating plane-polarised light to the right is no more than a means of identifying it and distinguishing it from (-)-citalopram and from (±)-citalopram, at a time when it was not known which of the S and R enantiomers was the (+)-enantiomer. The identifying and distinguishing feature of rotating plane-polarised light to the right has no other significance in the Patent or in the case otherwise. It is now known that in the case of citalopram, the (+)-enantiomer is the S-enantiomer. I do not see any difference between asking if Cipramil contains the (+)-enantiomer and asking if it contains the S-enantiomer. 539 Citalopram contains the molecule that is identified as (+)-citalopram. It is so identified because, when isolated, it rotates plane-polarised light to the right. It is beside the point that it is only once it is isolated that it can be seen to demonstrate the reason underlying its name. 540 The only reason why (+)-citalopram can not be seen to rotate plane-polarised light to the right when it is in the racemate, is that (-)-citalopram is also present, in an equal amount, with its property of rotating plane-polarised light to the left to precisely the same extent. The two equal but opposite propensities cancel each other out. 541 Nor do I find the Purity Submission persuasive. The 50% of the racemate that is either enantiomer is 95% pure. The word "contains" is an alternative to "consists of". While it would be wrong to say that the racemate consists of either enantiomer to the extent of 95% purity, it contains each of the two 95% pure enantiomers to the extent of 50% of its composition. 542 This view is not inconsistent with my construction of claim 1, which I held to refer specifically and distinctly to the pure (+)-enantiomer, and not to that enantiomer when merely a part of the racemate. The word "contain" in ss 70(3)(a) and 71(2)(b) gives a context and raises a question not present in the Patent specification: was the pharmaceutical substance (+)-citalopram that was disclosed in the Patent contained in something larger, racemic citalopram, or, more precisely, in the goods Cipramil? 543 Nor do I accept the Different Pharmacological Properties and Effects Submission. I have referred above to the physical relationship of inclusion which I think the word "contains" refers to in the present context. The language does not, in my view, invite or permit anything other than an inquiry into the question whether, as a matter of physical relationship, the goods Cipramil contain the molecule that, from its isolated state, derives the name "(+)-citalopram".

[15]

Introduction 545 I outlined the nature of the TGA proceeding at [36] - [40] and will not repeat what I said there. 546 Lundbeck Australia seeks: · a declaration that information provided by it to the Secretary in respect of applications for the registration of therapeutic goods containing the active substance escitalopram oxalate (defined to be the Information at [37] above) is "protected information" within the meaning of s 25A(2) of the TG Act (s 25A was set out at [36] above); and · an order in the nature of prohibition or an injunction to restrain the Secretary from using the Information when evaluating any application for registration of therapeutic goods pursuant to s 25(1) of the TG Act by a person other than by Lundbeck Australia, so long as the Information remains protected information within the meaning of s 25A(2). 547 The following matters may be noted at the outset. 548 First, the above formulation of the relief claimed refers to either all or some unidentified part of the information that Lundbeck provided to the Secretary "in respect of applications for the registration of therapeutic goods" of the kind described (the reference to "applications" in the plural will be noted). This is far too wide. Section 25A(2) defines "protected information" in a far more limited way. 549 In its statement of claim, Lundbeck Australia purported to give "particulars" of the information. However, it did so only in terms of the three broad classifications set out at [37] above. Lundbeck Australia has led evidence of documents it provided to the Secretary, but documents are not information. A document may contain information that satisfies the criteria of "protected information" set out in s 25A(2) and other information that fails to do so. It does not follow from the inclusion in a document of the former, that the Secretary is prohibited by s 25A(1) from using the latter. 550 Second, para (b) within s 25A(2) requires, firstly, that the information be "about the active component". On the basis that Lexapro is the "new goods" referred to in s 25A(2)(a), the active component is escitalopram. Accordingly, it is necessary to identify information that is "about" escitalopram. Not all information that Lundbeck Australia gave to the Secretary in relation to its application to register Lexapro was about escitalopram. 551 Third, again according to para (b) of s 25A(2), the information must be "not available to the public". The Court would need to be satisfied that the information to be referred to in its order was not already available to the public, and would have to include in the order a condition that the order cease to operate in relation to any remaining information upon its becoming available to the public. The order that Lundbeck Australia proposes incorporates a qualification of the latter kind. However, it does not identify and exclude certain information that is shown to be already available to the public. 552 Fourth, there is the question whether the criterion contained in para (c) of s 25A(2) is satisfied. When escitalopram oxalate (under the name Lexapro) was included in the ARTG on 16 September 2003 (less than five years ago - see para (e) of s 25A(2)), citalopram hydrobromide was already included in the ARTG under the name Cipramil (having been registered on 9 December 1997). The issue here is whether Cipramil was goods "consisting of, or containing", for the purposes of para (c) of s 25A(2), escitalopram, the active component of Lexapro. 553 The affinity between this fourth question and the questions raised in the Lundbeck Appeal (Extension of Term) Proceeding (Section K above) is clear. 554 Fifth, Lundbeck Australia has referred to the need for confidential information that it gave to the Secretary not to be disclosed to Alphapharm. An example is information relating to patients. However, s 25A and the relief sought by Lundbeck Australia relate only to the use to be made by the Secretary when evaluating therapeutic goods for registration. A holding that the Secretary may use information given to her by Lundbeck Australia for that purpose does not mean that the Secretary is at liberty to disclose that information to Alphapharm. I am not concerned for present purposes to identify limitations on the use that it would be proper for the Secretary to make of information given to her that is not "protected information" within s 25A.

[16]

Background facts 555 It is unlawful to market therapeutic goods in Australia unless they are registered on the ARTG. 556 Lundbeck Australia has made three applications to the Secretary for registration of therapeutic goods that are relevant to the present case:

Cipramil: As noted above, this was citalopram hydrobromide, which was registered on the ARTG as Cipramil on 9 December 1997.
Cipralex: The application for registration of Cipralex was unsuccessful, and Cipralex was never registered in the ARTG.
Lexapro: As noted above, this was escitalopram oxalate, which was registered on the ARTG as Lexapro on 16 September 2003. Sections 25A(2)(d) and (e) require that the "new goods" must have become registered. Accordingly, information that Lundbeck Australia provided to the Secretary in relation to its application to register Cipralex is not within the definition of "protected information", and the application to register Cipralex can be put to one side. The same information may be within the definition by reason of its having been also supplied in relation to the later application to register Lexapro. 557 According to the covering letter on the Cipralex application, and according to the evidence of Gitte Dyhr, Divisional Director of Regulatory Affairs at Lundbeck, that application was a "bridging application" in the sense of an application intended "to bridge" from the data filed in respect of an earlier drug (in this case, Cipramil) to the additional data filed to support the application for registration of another drug (in this case, Cipralex). 558 The Cipralex application was rejected by the TGA, and Lundbeck was required to file, and did file, additional data. This led to the registration of Lexapro. 559 On 15 June 2005, Alphapharm applied for registration on the ARTG of its generic product containing escitalopram as the active component. It is not disputed that "[Alphapharm's] generic escitalopram product is bioequivalent to Lundbeck's escitalopram product" or that Alphapharm's application was "an abbreviated application that does not include the vast amount of data, including clinical study and patient data, and expert reports, that a complete application for registration of a new drug substance would include". 560 In substance, Alphapharm invited the TGA, when evaluating its application, to rely on the data that had been filed by Lundbeck Australia, including clinical studies, patient data and expert reports, in support of Lundbeck Australia's application to register Lexapro. 561 The Secretary took the view that this information was not protected information within the meaning of s 25A(2) of the TG Act. The Secretary agreed, however, not to deal with this information further in connection with Alphapharm's application without prior notice to Lundbeck Australia. 562 In its statement of claim Lundbeck Australia alleges that it will suffer loss and damage if the information in question is not treated as "protected information" within s 25A, and is used to evaluate Alphapharm's therapeutic goods.

[23]

Ways in which information about escitalopram has become available to the public 579 Under the heading "Ways in which information about escitalopram has become available to the public" in her affidavit, Ms Dyhr refers to the practice in some countries for the relevant regulatory authority itself to prepare and publish a summary of certain aspects of applications for registration. She gives as an example the FDA in the United States of America, which prepares drug approval reviews. In relation to escitalopram, the FDA has published certain reviews of the regulatory dossier filed in the USA. These reviews are available to the public, including the public in Australia, via the internet. Exhibited to Ms Dyhr's affidavit is an example of a review from the FDA's website. 580 Barry John Spencer, who is employed by Alphapharm as a "Senior Patent Officer", has put into evidence as Exhibit BJS-1 a CD-Rom containing copies of documents that he downloaded from the FDA website. The documents relate to the FDA Drug Approval Process for Lexapro. It is clear that the documents are publicly available in Australia. There are 18 documents comprising 683 pages. 581 Ms Dyhr states that other countries such as Sweden and France adopt a similar process of reviewing the dossiers, although the reviews produced by authorities other than the FDA are brief (about four to six pages in length), and no country has published any information that is not also included in the reviews published by the FDA. 582 Mr Dyhr states that the European Medicines Agency (EMA) which provides a centralised process for seeking regulatory approval in European Union countries, also produces a summary (briefer than that produced by the FDA) in relation to applications filed using the centralised procedure of the EMA. However, in respect of escitalopram Lundbeck did not use that procedure. Rather, it made applications directly in each country in which it wished to market escitalopram. Accordingly, the EMA has never produced such a summary relating to escitalopram. 583 Ms Dyhr states that except as disclosed in the summaries described above, to the best of her knowledge, the various regulatory authorities to which Lundbeck has submitted information corresponding to that provided to the TGA have treated the information as confidential and have not made it publicly available. 584 Ms Dyhr states that Lundbeck itself has recently adopted a practice of publishing on a website in summary form "the results of all studies conducted in relation to its products". Mr Dyhr states that this Lundbeck website includes four to six page summaries of each of the complete studies conducted by or on behalf of Lundbeck in relation to escitalopram, and she exhibits to her affidavit an example.

[25]

(1) Is Cipramil (citalopram hydrobromide) another therapeutic good "consisting of, or containing" (+)-citalopram within the meaning of s 25A(2)(c)(i)? 587 Lundbeck Australia does not dispute that (+)-citalopram is an active component of Lexapro. Alphapharm and the Secretary submit, however, that according to the plain meaning of s 25A, it is also an active component, indeed on one view, the active component of Cipramil, and that Cipramil consists of or contains (+)-citalopram. Lundbeck Australia does not admit that escitalopram oxalate in tablet form, which was the subject of its Lexapro application, consists of or contains (+)-citalopram as an active component. 588 Lundbeck Australia relies heavily on the background to the relevant statutory provisions and on the arguments it made as to why Cipramil does not "contain" (+)-citalopram for the purposes of the definition of "first regulatory approval date" in s 70(5) of the Act (see Section K above). 589 Section 25A of the TG Act was inserted with effect from 17 April 1998 by the Therapeutic Goods Legislation Amendment Act 1998. In the Second Reading Speech on the Therapeutic Goods Legislation Amendment Bill 1997, the Parliamentary Secretary to the Minister for Health and Family Services said (Parlt of Aust, HR, Hansard, 3 December 1997, p 11933): The changes to the therapeutic goods legislation include measures designed to improve the operating environment for the Australian pharmaceutical industry, as well as to ensure the availability of new drugs, while enhancing Australia's commitment to its international obligations under the WTO Agreement on Trade Related Aspects of Intellectual Property Rights. This will be achieved through the introduction of a new data protection scheme for new chemical entities, referred to as 'active components' in the amending legislation. At present, confidential information submitted to the Therapeutic Goods Administration in connection with applications to register products in the Australian Register of Therapeutic Goods is protected against disclosure, unless release is in the public interest, and also against use by the TGA for its own commercial benefit. Under the new 'data protection' scheme to be introduced by this bill, this data will now have five years of 'data protection'. During this time, any other company seeking to register a generic copy of the registered product containing, or consisting of, the active component will be required to seek the agreement of the originator company before the TGA can directly or indirectly access or reference the originator company's data relating to the same active component. Applicants seeking to register generic products containing protected active components may still do so. However, they must develop and lodge their own full data package, instead of lodging an abbreviated package that demonstrates bioequivalence with a new active component. Most products that have a new active component will attract separate protection under a patent during their first five years on the market, but the 'data protection' regime will provide a safety net for those products which may fall outside the norm. 590 The relevant article of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) is Art 39 which reads:

In the course of ensuring effective protection against unfair competition as provided in Article 10bis of the Paris Convention (1967), Members shall protect … data submitted to governments or governmental agencies in accordance with paragraph 3.
…
Members, when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products which utilize new chemical entities, the submission of undisclosed test or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use. In addition, Members shall protect such data against disclosure, except where necessary to protect the public, or unless steps are taken to ensure that the data are protected against unfair commercial use. Lundbeck Australia draws attention to the definition of "new chemical entity" in Schedule 9 to the Therapeutic Goods Regulations 1990 (Cth)(TG Regulations): (a) a chemical, biological or radiopharmaceutical substance that has not previously been included in the Register, or (b) an isomer, mixture of isomers, complex of, derivative of or salt of, a registered chemical substance that, having previously been included in the Register, differs from the registered substance in having different safety or efficacy properties; or (c) ... Lundbeck Australia points out, and the contrary was not suggested, that in the TG Regulations, the significance of something's being a new chemical entity is that an application to register it will ordinarily attract higher fees because of the much larger volume of material that has to be considered by the TGA than in the case of a "generic product". 591 Lundbeck Australia also refers to Chapter 17 of the Australia/United States Free Trade Agreement dealing with intellectual property rights, in particular, Art 17.10 which is, relevantly, as follows: Article 17.10: Measures Related To Certain Regulated Products.
(a) If a Party requires, as a condition of approving the marketing of a new pharmaceutical product, the submission of undisclosed test or other data concerning safety or efficacy of the product, the Party shall not permit third persons, without the consent of the person who provided the information, to market the same or a similar product on the basis of that information, or the marketing approval granted to the person who submitted such information, for at least five years from the date of marketing approval by the Party. (b) … (c) ... (d) For the purposes of this Article, a new product is one that does not contain a chemical entity that has been previously approved for marketing by the Party. (e) …
With respect to pharmaceutical products, if a Party requires the submission of … new clinical information (other than information related to bio equivalency) … which is essential to the approval of a pharmaceutical product, the Party shall not permit third persons not having the consent of the person providing the information to market the same or a similar pharmaceutical product on the basis of the marketing approval granted to a person submitting the information for a period of at least three years from the date of the marketing approval by the Party …17-[26]. Footnote 17-[26] reads: 17-[26] As an alternative to this paragraph, where a Party, on the date of entry into force of this Agreement, has in place a system for protecting information submitted in connection with the approval of a pharmaceutical product that utilizes a previously approved chemical component from unfair commercial use, the Party may retain that system, notwithstanding the obligations of this paragraph. 592 Lundbeck Australia refers to a publication of the Department of Foreign Affairs and Trade entitled "Plain English Guide to the Agreement" which provides a commentary on each article of the Australia/United States Free Trade Agreement, but I do not find it necessary to refer to that material. 593 Lundbeck Australia also refers to ss 15AA and 15AB of the Acts Interpretation Act 1901 (Cth) (the AI Act). Section 15AA provides that in the interpretation of a provision of an Act, a construction that would promote its underlying purpose or object is to be preferred to a construction that would not do so. Section 15AB of the AI Act provides, relevantly, that extraneous material that is capable of assisting in the ascertainment of the meaning of a provision may be considered: (b) to determine the meaning of the provision when: (i) the provision is ambiguous or obscure; or (ii) the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act leads to a result that is manifestly absurd or is unreasonable. 594 Lundbeck Australia submits that the expression "active component" as used in s 25A(2)(c)(i) and defined in s 25A(3) of the TG Act, is ambiguous or obscure, and that the interpretation of that expression supported by Alphapharm would lead to a result that is "manifestly absurd" or "unreasonable". In support, Lundbeck Australia suggests that despite having required Lundbeck Australia to submit a "full regulatory application" in support of its application to register Lexapro, the TGA would not treat the information submitted in the same way as it would treat information contained in a full regulatory application submitted in support of applications to register other therapeutic goods. 595 Lundbeck Australia summarises its submissions in relation to the interpretation of s 25A as follows: Lundbeck therefore submits that the phrase "active component" should be interpreted synonymously with the phrase "new chemical entity", consistently with the way these two phrases have been used both in the legislative background to s25A of the TG Act and in the TG Regulations, in accordance with Australia's international obligations under TRIPS and the Australia/United States FTA, and in accordance with the AI Act, which can be summarised as follows: a. "…This will be achieved through the introduction of a new data protection scheme for new chemical entities, referred to as "active components" in the amending legislation". Second reading speech for the introduction of s25A into the TG Act; b. "…Members, when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products which utilize new chemical entities, the submission of undisclosed test or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use". Article 39(3) of TRIPS; c. "…(a) a chemical, biological or radiopharmaceutical substance that has not previously been included in the Register; or (b) an isomer, mixture of isomers, complex of, derivative of or salt of, a registered chemical substance that, having previously been included in the Register, differs from the registered substance in having different safety or efficacy properties": definition of new chemical entity contained in Schedule 9 of the Therapeutic Goods Regulations; and d. "1. (a) If a party requires, as a condition of approving the marketing of a new pharmaceutical product, …. (d) For the purposes of this Article, a new product is one that does not contain a chemical entity that has been previously approved for marketing by the Party". Article 17.10 of the Australia/United States Free Trade Agreement. In the present case, the TGA rejected an application to register therapeutic goods containing escitalopram by Lundbeck which sought to bridge to data previously submitted regarding citalopram. Instead, it insisted on the preparation and submission of additional pharmacology and clinical studies. Ultimately, when the Australian Drug Evaluation Committee (ADEC) recommended Lexapro for inclusion on the ARTG, it did so as a new chemical entity. [emphasis in original]

[26]

(2) What is the "information" that Lundbeck Australia contends is protected? 596 The purported particularisation in the statement of claim of the information that Lundbeck Australia claims is "protected information" within s 25A cannot be accepted as a serious attempt to identify information at all. 597 There have been progressive attempts by Lundbeck Australia to narrow its description of the information that it contends is protected information. 598 Ms Dyhr was taken to the tables of contents of Parts III and IV of Lundbeck's application to the TGA for the registration of escitalopram oxalate. Those tables of contents comprised 55 pages and 10 pages respectively, each page being part of a list of studies. Ms Dyhr agreed that the studies identified in italics within the lists were studies that came from the application for registration of Citalopram (citalopram hydrobromide). Lundbeck Australia accepted that the information that was contained in the studies, the titles of which were in italics in the two tables of contents, is not "protected information" because five years had passed since the day Cipramil was included in the ARTG (9 December 1997) - see s 25A(2)(e) of the Act. 599 Lundbeck Australia has attached to its closing submissions the following lists which are relevant to the question whether Lundbeck Australia has adequately identified the information in respect of which it seeks relief: Annexure B: "Summaries of study results as listed on Lundbeck and Forest websites [the reference to "Forest" is a reference to Lundbeck's licensee in the USA]" Annexure C: "List of publications concerning escitalopram" Annexure D: "Table of material inadvertently included in GD-7 and made publicly available in FDA reviews" 600 Lundbeck Australia concedes that it could not reasonably contend that the information contained in these documents is protected information within s 25A. It will be noted that Annexure D represents a retreat from the position as represented in Exhibit GD-7. 601 In its closing written submissions, Lundbeck Australia reformulated the relief it seeks as follows: a. When evaluating therapeutic goods for registration on the Australian Register of Therapeutic Goods, the First Respondent be restrained until 15 September 2008 from using the following information about escitalopram which was given to the First Respondent by the Applicant in relation to Parts I C, II C, III and IV of its applications to register therapeutic goods: i. individual patient or animal data taken in clinical or animal studies assessing the pharmacology, toxicology or efficacy of escitalopram and summaries thereof; ii. analyses of such data contained in the study reports included in those parts of its applications; iii. expert opinions about the pharmacology, toxicology or efficacy of escitalopram; save to the extent that any such data, analyses or opinions has become publicly available whether prior or subsequent to the date of these orders. b. Without limiting the above, the following information is publicly available: i. the information contained in Exhibit BJS-1 to the Affidavit of Barry John Spencer sworn 21 December 2006 in this proceeding; ii. the information contained in any of the documents identified in Annexures B, C & D to these submissions. The significance of the date 15 September 2008 is that it marks the expiry of the five-year period during which Lexapro will have been registered on the ARTG (see s 25A(2)(e) of the TG Act). The significance of Exhibit BJS-1 appears at [580] above. Annexures B, C and D were discussed at [599] above. 602 The Secretary accepts that Lundbeck Australia is entitled to some form of relief if it is shown that some or all of the information it gave to her in relation to its application to register escitalopram oxalate (Lexapro) is "protected information" and "if an appropriate form of relief can be framed". She submits, however, that Lundbeck Australia has not identified "protected information" within s 25A with sufficient particularity to enable a meaningful order to be made.

[27]

(3) Is the information "about" the enantiomer (+)-citalopram for the purposes of s 25A(2)(b)? 603 Questions 3 and 4 have been indirectly referred to in the course of my discussion of Question 2. 604 Lundbeck Australia would not be entitled to relief in respect of information that was not "about" escitalopram. 605 In oral submissions, Lundbeck Australia submitted that it should not be accepted that s 25A called for a line by line analysis. Lundbeck Australia invited me to accept that "the data package should be treated as a whole" . 606 The Secretary submits that Exhibit GD-7 does not assist in identifying protected information as it lists only documents that are said to contain protected information. The Secretary contends that Lundbeck does not, and indeed could not, assert that all of the information contained in those documents is "about" escitalopram. For example, the study reports necessarily contain information on other comparable drugs which is not "about" escitalopram. One example is a cardiovascular study by M Maginn, "The effect of S-citalopram (...), citalopram (...), sertraline (...), fluoxetine (...), paroxetine (...), femoxetine (...), on ECG and Hemodyamics in the isolated Perfused guinea-pig heart". This was a report of "Non-Clinical Safety Research" conducted by Lundbeck. Another example is information contained in study reports describing patients' circumstances and the results in the cases of those taking placebo. A further example is information about packaging and manufacturing and about the applicant, Lundbeck Australia, itself. 607 Similarly, Alphapharm submits that the unexpressed assumption underlying Ms Dyhr's evidence appears to be that because a study relates to escitalopram or citalopram, and has been included in an application to the TGA, the whole of the documentation of the study is "about" the active component. A particular example emphasised by Alphapharm is a study report of Forest Laboratories, Inc concerning the study "MD-01". Alphapharm submits that, for example, page 15 of that study ("List of Patient Narratives") could not be said, by any stretch of the information, to be "about" escitalopram.

[29]

Consideration 612 I turn first to the "active component" question. 613 It is not in dispute that: · Lexapro consists of or contains as an active component, S-citalopram or escitalopram or (+)-citalopram; · Less than five years prior to Lundbeck Australia's application to register Lexapro, Cipramil became registered on the ARTG; · Cipramil is a racemate containing in equal parts S-citalopram and R-citalopram; and · S-citalopram is the (+)-enantiomer and R-citalopram is the (-)-enantiomer. 614 Lundbeck Australia relies on the submissions on which Lundbeck relied in support of its submission that the pharmaceutical substance per se that is disclosed in the complete specification of the Patent and that falls within its claims is not a pharmaceutical substance that citalopram, the subject of the Australian Citalopram Patent, contains or consists of. Those submissions were the New Chemical Entities submission, the Rotation of Plane-Polarised Light Submission, the Purity Submission, and the Different Pharmacological Properties and Effects Submission. I adopt what I have said in Section K above in relation to those submissions and also make the following comments concerning them. 615 In relation to the New Chemical Entities submission, I note that the term "new chemical entity" is not used in s 25A or elsewhere in the TG Act. Moreover, the fact that Professor Day or others regard citalopram and escitalopram each as a "new chemical entity" is not relevant to the mixed question of law and fact that I must decide, namely, whether the former "consists of or contains" the latter within the meaning of the statute. 616 In relation to the Rotation of Plane-Polarised Light submission, I think that the reference to (+)-citalopram is also a reference to the molecule S-citalopram. That molecule exists, whether in the racemate or separated from it. The identity of the molecule does not change according to whether it forms part of the racemate or not. Its identity does not change just because in the racemic mixture its property of rotating plane-polarised light clockwise can not be observed because it is neutralised by the equally strong property of the molecule R-citalopram of rotating plane-polarised light anti-clockwise. 617 In relation to the Purity Submission, I need not add to what I said in Section K. 618 In relation to the Different Pharmacological Properties and Effects Submission, the Secretary emphasises that whatever the merits of that submission in relation to s 70 and associated sections of the Act, it misses the point in relation to the definition of "protected information" in s 25A(2) of the TG Act, because the comparable concept used in s25A(2) is "active" component. Escitalopram is the active component of Lexapro and an active component that Cipramil at least contains. 619 Section 25A(3) clearly contemplates that therapeutic goods may contain more than one active component. In the case of Lexapro, the only active component is escitalopram. In the case of Cipramil, there are probably two active components: S-citalopram and R-citalopram, S-citalopram being the therapeutically beneficial one. The word "containing" in s 25A(2)(c)(i) must be read in the light of the definition of "active component" in s 25A(3). It is not required that escitalopram be the active component of Cipramil in order for s 25A(2)(c)(i) to be enlivened. It satisfies that provision if escitalopram is contained as one of two or more active components in Cipramil. 620 I do not think that s 25A(2)(c)(i) is ambiguous or obscure or that the ordinary meaning conveyed by it which I have indicated above leads to a result that is manifestly absurd or unreasonable within s 15AB of the AI Act. Therefore, I do not derive assistance from the numerous extraneous materials to which I have referred above. 621 Such matters as the conduct of officers of the TGA and of Alphapharm, the evidence given by Professor Day and the references to "new chemical entity" that were introduced into the TG Regulations(by the Therapeutic Goods Amendment Regulations 2002 (SI No 2/2002)) after s 25A was introduced into the TG Act, are all irrelevant to the question of the proper construction of the TG Act. 622 In my opinion, Cipramil contains as an active component escitalopram, the active component of Lexapro, for the purposes of s 25A of the TG Act. 623 In view of the conclusion I have reached on Question 1, Lundbeck Australia's application should be dismissed and it is not necessary that I consider Questions 2, 3 and 4. However, as they were fully argued, I will address them, albeit together. 624 Alphapharm cites authorities in which it has been held that an injunction against use of confidential information must identify the confidential information with sufficient particularity: O'Brien v Komesaroff (1982) 150 CLR 310 at 324-8; Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2) (1984) 156 CLR 414 at 438-439; Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 at 443; American Cyanamid Co v Alcoa of Australia Ltd (1993) 27 IPR 16 at 20-21. 625 Those cases, unlike the present one, were concerned with identifying information that had the requisite character of confidentiality by reason of the application of general law principles. We are concerned here to identify particular information that was given by Lundbeck Australia to the Secretary that satisfies the criteria specified in s 25A(2). I readily agree that the information must nonetheless be identified with precision and not merely in global terms, if it is to be the subject of an order of the Court. However, the process of identifying the information is rather different from the process of identifying information that is confidential in accordance with general law principles. 626 Whether particular information falls within s 25A is an objective question that entails no element of administrative discretion on the Secretary's part. 627 Lundbeck Australia submits that under s 25A, the onus rests on the Secretary to satisfy herself that certain information lies outside the definition of "protected information". It is true that if Lundbeck Australia had not launched the present proceeding, s 25A would have obliged the Secretary not to use protected information for the purpose mentioned in the section. The section would therefore have obliged the Secretary to decide, at peril of a successful proceeding for an injunction against her if she should err, which information fell within the definition. In that situation, the language of "onus" is not appropriate. 628 Once Lundbeck Australia seeks declaratory and injunctive relief, however, it bears the onus of identifying information that falls within the definition. It is not an appropriate exercise of discretion for the Court to enjoin conduct simply in the general terms of the statutory obligation, leaving the Secretary to determine, at peril of committing a contempt of court, whether particular conduct falls within the injunction. Moreover, "entitlement" to an injunction is established only if Lundbeck Australia proves non-compliance by the Secretary, actual or threatened, with the statute, and this requires Lundbeck Australia to establish that the Secretary has used or is threatening to use, particular information that falls within the definition. Lundbeck Australia must identify all of the information that satisfies all of the (cumulative) criteria of the definition of "protected information": the definition does not contain excisions, exclusions or exceptions, the onus of proving the operation of which may have rested on the Secretary. 629 In my opinion, as a matter of identification of the information that the Secretary is to be ordered not to use, the formulation proposed by Lundbeck Australia in its closing written submissions (at [601] above) is adequate. It provides for the inevitable exception based on information becoming available after the date of the orders. Lundbeck Australia has attempted in Annexures B, C and D to its submissions (referred to in the proposed orders) to capture all information about escitalopram that is publicly available. In case anything has been omitted, any other information that has become publicly available is also to be excepted from the scope of the proposed order. I do not think this introduces objectionable vagueness or uncertainty. 630 The next question is whether I am satisfied that all of the information described in paras (a)(i), (ii) and (iii) is "about" escitalopram. I am so satisfied. 631 There may be scope for considerable argument concerning the word "about". However, subparas (i), (ii) and (iii) within para (a) of the orders proposed by Lundbeck Australia are all tied to escitalopram, which is mentioned expressly in subparas (i) and (iii) and is referred to by implication in subpara (ii). 632 The parties asked that I not make orders in any of the proceedings before the Court but that I publish my reasons and allow them the opportunity to agree upon the form of orders to be made. In the present proceeding, this course would have allowed the Secretary the opportunity of identifying any particular difficulty that she would encounter in complying with an order of the kind proposed. However, because I have answered Question 1 above unfavourably to Lundbeck Australia, she will not need to do so.

[31]

Pleadings and Particulars 634 I referred to the cross-claim for infringement in the Revocation Proceeding at [34]-[35] above, and will not repeat what I said there. There is no issue concerning Lundbeck's title to the Patent or Lundbeck Australia's being the exclusive licensee of the Patent or being entitled to sue for infringement of it. 635 In this Section M, I will refer to Lundbeck and Lundbeck Australia as "the Lundbecks" and, generally speaking, will not distinguish between them. 636 The Lundbecks' cross-claim is for infringement of Claims 1, 3, 5 and 6. The Lundbecks seek permanent injunctions, an order for delivery up for destruction, damages or, at the Lundbecks' option, an account of profits, and associated relief. 637 As particulars of infringement, the Lundbecks allege that: · since at least November 2002 Alphapharm has manufactured at its plant at Carole Park, Queensland, goods containing escitalopram oxalate, as admitted in a letter from Alphapharm's solicitors, Mallesons, to the Lundbecks' solicitors (Corrs Chambers Westgarth (Corrs)) dated 21 September 2005; · that on or about 15 June 2005, Alphapharm sponsored an application to the TGA for approval to market and sell a product containing (+)-citalopram, and for that purpose provided the TGA with a certificate pursuant to s 26B(1)(a) of the TG Act; and · that on or about 15 June 2005, Alphapharm sponsored an application to the TGA for approval to market and sell a product containing (+)-citalopram manufactured by a certain method described in certain specified documents, and for that purpose provided to the TGA a certificate pursuant to s 26B(1)(a) of the TG Act. 638 In the letter dated 21 September 2005 to Corrs, Mallesons stated that Alphapharm had given the TGA a certificate pursuant to s 26B(1)(a) of the TG Act in the standard form approved by the Secretary, and that for purposes in connection with having goods containing escitalopram oxalate (Escitalopram Oxalate Goods) included in the ARTG and/or obtaining similar regulatory approval under the laws of foreign countries, Alphapharm had manufactured such goods at its manufacturing plant at Carole Park, Queensland (particulars of the quantities, dosages, dates of manufacture and countries were set out in a schedule to the letter). The letter further stated: (3) Subject to obtaining the requisite regulatory approvals and listings, it is Alphapharm's desire to engage in the following activities (none of which have commenced) in relation to Escitalopram Oxalate Goods for the Australian market: (i) manufacture at Carole Park; (ii) offer for sale; (iii) sell; (iv) otherwise dispose of; (v) use; and (vi) keep for the purpose of doing any of those things. Alphapharm does not presently intend importing Escitalopram Oxalate Goods into Australia or exporting Escitalopram Oxalate Goods (other than perhaps for regulatory purposes) from Australia. (4) Alphapharm has not manufactured and does not intend manufacturing the active pharmaceutical ingredient escitalopram oxalate ("API") used in its Escitalopram Oxalate Goods. Alphapharm has imported and intends in the future importing API…in the form of tablets for the Australian market. … (5) The intermediate used by Alphapharm's API supplier in the process of manufacturing the API is (+/-)-4-bromo-alphaą-(4-fluorophenol)-alphaą-[3-(dimethylamino)propyl]-1,2-benzene dimethanol hydrobromide [not] 4-(4-dimethylamino)-1-(4'-flourophenyl)-1-(hydroxyl-1-butyl)-3-(hydroxymethyl)benzonitrile as claimed in claim 6 of the Patent... 639 On 12 May 2006, the Lundbecks gave Alphapharm a notice to admit facts to which Alphapharm replied by a notice disputing facts dated 26 May 2006, admitting certain facts and disputing others. I will discuss the evidentiary position further below. 640 In a later letter dated 14 July 2006, Mallesons advised Corrs that they were instructed, for clarification, to inform Corrs that Alphapharm had performed the following acts: · imported raw materials containing escitalopram oxalate, · conducted testing on those raw materials containing escitalopram oxalate; · manufactured goods containing escitalopram oxalate at Alphapharm's manufacturing plant in Carole Park, Queensland ("Carole Park") details of which were set out in the … Schedule to [Mallesons'] letter dated 21 September 2005; · tested goods containing escitalopram oxalate manufactured at Carole Park prior to and after 27 May 2004; · exported samples of goods containing escitalopram oxalate for the purposes of testing those goods prior to and after 27 May 2004; · imported and tested goods containing escitalopram oxalate (i.e. brand leader products) both prior to and after May 2004; and · tested products marketed by Lundbeck in Australia containing escitalopram oxalate prior to and after 27 May 2004. 641 Section 26B of the TG Act referred to above requires that in certain circumstances an applicant to the TGA for registration or listing of therapeutic goods must provide to the TGA (s 26B(1)(a)): A certificate to the effect that the applicant, acting in good faith, believes on reasonable grounds that it is not marketing and does not propose to market, the therapeutic goods in a manner, or in circumstances, that would infringe a valid claim of a patent that has been granted in relation to the therapeutic goods; … 642 In its defence to the cross-claim for infringement, Alphapharm maintains that the Patent is invalid, and in addition to various denials and non-admissions, relies on s 78(2) of the Act, in so far as it may be held that the Patent is valid and the extension of term of the Patent is valid (both of which propositions are denied). Section 78(2) provided, relevantly, as follows: If the Commissioner grants an extension of the term of a standard patent, the exclusive rights of the patentee after the grant of the extension are not infringed by a person exploiting: (a) a pharmaceutical substance per se that is in substance disclosed in the complete specification of the patent and in substance falls within the scope of the claim or claims of that specification; or …; solely for purposes in connection with: (c) having goods included in the Australian Register of Therapeutic Goods, where the goods are intended for therapeutic use; or (d) obtaining similar regulatory approval under a law of a foreign country or of a part of a foreign country. 643 I note that s 78(2) was repealed on 25 October 2006 by the Intellectual Property Laws Amendment Act 2006 (Cth). That amending Act also inserted s 119A into the Act. Item 4 of Schedule 7 of the amending Act provides that s 119A applies "in relation to the exploitation, at or after the time [s 119A] commences, of inventions claimed in patents in force at or after that time". The Explanatory Memorandum for the Bill for the amending Act stated that s 78(2) continued to apply in relation to any exploitation of patents that occurred prior to the commencement of s 119A. It would therefore seem that s 119A is the provision on which Alphapharm would have to rely in respect of any exploitation on or after 25 October 2006. Section 119A is wider than s 78(2). According to the Explanatory Memorandum, the purpose of the amendment was to "allow springboarding as an exception to patent infringement on any pharmaceutical patent at any time for purposes solely in connection with gaining regulatory approval of a pharmaceutical product in Australia or another territory". Importantly, s 119A applies where no extension of the term of the patent has been granted. If Alphapharm is successful in raising a s 78(2) defence, it could also rely on s 119A in respect of its conduct on or after 25 October 2006. Neither party referred to the repeal of s 78(2) or its replacement by s 119A. 644 As noted at [28] above, on 27 May 2004 the Commissioner granted an extension. Alphapharm pleads that both before and since 27 May 2004 it has manufactured goods containing (+)-citalopram only for purposes in connection with having those goods included in the ARTG and/or for obtaining similar regulatory approval under the laws of foreign countries.

[33]

The claim of infringement of the method claim (claim 6(b)) 648 Claim 6(b) was set out at [10] above, but it is convenient to repeat it here: 6. A method for the preparation of the compound of claim 1, which comprises: (a) …; or (b) reacting a compound of formula II with the enantiomer of an optically active acid affording the pure enantiomer salt of the compound of formula II for (+)-citalopram, and subsequently performing ringclosure via a labile ester by reacting the pure enantiomer of formula II as a base with an activated acid with simultaneous addition of a base, and, if desired, transferring the (+)-citalopram obtained to a pharmaceutically acceptable salt thereof. The compound of formula II is the cyano-diol. 649 The Lundbecks address Alphapharm's submission that the method followed by its supplier, A (for confidentiality reasons, I will substitute the letter "A" for references to the Lundbecks' overseas supplier), involved the use of a bromo-diol rather than the cyano-diol. In the Joint Report, the following appears under the heading "Infringement of Claim 6(b)": Comparison of the [A] and LUNDBECK processes (as portrayed in the Petersen affidavit [an affidavit of Hans Petersen sworn 13 December 2006 - see below]). Overall Agreement: Apart from the replacement of the cyano-substituent for a bromo-substituent the [A] process is the same as the LUNDBECK process. The two involve the same sequence of bond forming reactions except for the delayed introduction of the cyano group in the case of the [A] process. Step 1: Resolution Agreement: The fact that the cyano-diol can be resolved by diastereomeric salt formation does not allow the prediction that the bromo-diol will also be resolvable in the same way. The experiment has to be tried to find out. The mesomeric electron-donating ability of a bromo-substituent might make the bromo-diol more sensitive to acid than the cyano-diol. … (iii) Step 2: Dehydration/Cyclisation Agreement In terms of the SN2 cyclisation process there will be no material differences between the cyano-diol and the bromo-diol. The nature of the diols allows the tertiary C-O bond to align perpendicular to the plane of the bromo/cyano substituted arene ring, a conformation where any differences in substituent effects can manifest themselves. In the cyclised products the tertiary C-O bond is forced to lie in a closer to coplanar arrangement with the bromo/cyano-substituted arene ring thus reducing any substituent effects. Disagreement: MGB: The bromo-phthalan will be more sensitive, albeit with a diminished sensitivity compared to its bromo-diol precursor, to acid than the cyano-phthalan (citalopram). SGD: There will be essentially no material differences between the cyano-phthalan and the bromo-phthalan in terms of acid sensitivity. Step 3: Exchange of bromo for cyano This step is not required in the Lundbeck process. Step 4: Precipitation of the active pharmaceutical ingredient. Agreement: This step is identical in the [A] and Lundbeck processes. 650 Exhibit R9 was the following table, submitted by the Lundbecks, comparing the steps involved in the A process with the integers of Claim 6(b) (the references to ECT-1 to ECT-VIII are references to various steps in the A process as described in the A documents which formed Exhibit HP-1 to Mr Peterson's affidavit of 13 December 2006): [A] process step Integer of claim 6 ECT-I & ECT-II These steps take place in order to form the diol precursor and before the steps contemplated by claim 6(b) A method for the preparation of the compound of claim 1, which comprises…(b) ECT-III Reacting a compound of formula II [i.e., the cyano-diol] [A] uses a bromo-diol rather than the cyano-diol ECT-III states that the diol is "treated with (+)-di-toluoyltartaric acid, which is a single enantiomer of an optically active acid with the enantiomer of an optically active acid ECT-III - "to get resolved (-)-amine Affording the pure enantiomer salt of the compound of formula II for (+)-citalopram salt" etc is a reference to the enantiomer salt of the diol present together with (+)- hemi-di-p-toluoyltartaric acid ECT-IV refers to neutralising (the acid) to get the (-)-amine extracted into toluene i.e., pure) ECT-V [includes] the ringclosure step And subsequently performing ringclosure The labile ester is the product of the reaction of the resolved diol with methanesulfonyl chloride (see below) via a labile ester i.e., the product of step ECT-IV by reacting the pure enantiomer of formula II as a base Methanesulfonyl chloride With an activate acid Triethylamine With simultaneous addition of a base ECT-VI describes reaction with oxalic acid to get the oxalate salt, which is pharmaceutically acceptable ECT-VII describes the cyanation process which exchanges the CN in place of the Br ECT-VIII describes reaction with oxalic acid to get the oxalate salt, which is pharmaceutically acceptable And, if desired, transferring the (+)- citalopram obtained to a pharmaceutically acceptable salt thereof

[36]

Alphapharm's response to the claim of infringement of the method claim (claim 6(b)) 654 Alphapharm submits that on its proper construction, claim 6(b) excludes the possibility of substituting the CN (cyano) with any substituent, including Br (bromo), because the formulae in claim 6(a) demonstrate that "R" is used when substitution is intended to be covered. The formulae are set out in [10] above. It will be noted that formula II refers to CH2OH, whereas formula II' gives CH2OR, the R being a labile ester group. 655 Alphapharm submits that the cyano-substituent on the diol is an essential integer in the various steps of claim 6(b). Claim 6(b) refers to formula II (and not to formula II'), and the specification at page 2, lines 21-28 refers to "benzonitrile" which, Professor Davies agreed, means "cyano-". Similarly, the consistory clause at page 3, line 11 introduces the method claim with the words: according to the invention, II is reacted with … and formula II at the top of page 3 is identical to formula II in claim 6. 656 Alphapharm relies on other references in the Patent specification to formula II and to "nitrile". 657 Alphapharm submits that "the wording of the claims makes it clear that the relevant area has been deliberately left outside the claim", citing Sachtler at [53]. 658 Alphapharm submits that the cross-examination of Professor Banwell established that the steps of the A process were different from the integers of Claim 6(b). 659 Another defence raised by Alphapharm concerns the definition of "exploit" in Schedule 1 to the Act. Section 13(1) of the Act provides that, subject to the Act, a patent gives the patentee the exclusive rights, during the term of the patent, to exploit the invention and to authorise another person to do so. Section 13(3) provides that a patent "has effect throughout the patent area". The definition of "exploit" in the Dictionary in Schedule 1 is as follows: exploit, in relation to an invention includes: (a) where the invention is a product - make, hire, sell or otherwise dispose of the product, offer to make, sell, hire or otherwise dispose of it, use or import it, or keep it for the purpose of doing any of those things; or (b) where the invention is a method or process - use the method or process or do any act mentioned in paragraph (a) in respect of a product resulting from such use. Alphapharm submits that para (b) of the definition requires that the use of the method or process be in the "patent area". The "patent area" is defined in the Dictionary in Schedule 1 and may, for convenience, be thought of as being "Australia".

[39]

Authorities 661 The authorities relating to infringement were recently reviewed by Bennett J in Sachtler at [43]-[67]. Her Honour cautioned against the purported application of the "pith and marrow" or "substance of the invention" approach, untrammelled by the form of the claims (at [55]). 662 It is necessary for the Court to construe claim 6(b) in the light of the common general knowledge as at the priority date. How would the non-inventive person skilled in the art at that time, possessed of that common general knowledge, have understood the words of the claim? 663 There is little case law in Australia in relation to "mechanical equivalents" and "non-essential integers" in the context of chemical formulae. In Saccharin Corporation Ltd v Anglo-Continental Chemical Works Ltd (1900) 17 RPC 307 at 319, Buckley J held that a method claim was infringed notwithstanding that changes had been made, because the same result was achieved. 664 In Beecham Group Ltd v Bristol Laboratories Ltd (1977) 1B IPR 665 (Beecham),the plaintiff alleged infringement of patents for a pharmaceutical compound by the importation, offering for sale and sale in the United Kingdom of the antibiotic, Hetacillin. The plaintiff held four patents relating to a new class of semi-synthetic penicillins and to methods for their manufacture. One such penicillin was Ampicillin, a valuable antibiotic. The clinical effectiveness of Hetacillin was due entirely to Ampicillin, of which it was an acetone derivative. In the presence of water, as and when administered as an antibiotic, Hetacillin would revert into Ampicillin by a reversible chemical reaction. 665 The Lundbecks rely on a passage from the speech of Lord Diplock, the whole of the paragraph being as follows (p 710): I have already expressed my opinion that the pith and marrow doctrine is applicable to claims for new products as well as to new processes; and I agree with the Court of Appeal that the relationship of hetacillin to ampicillin provides a clear case for its application. It was argued that what is claimed in the patents as an essential feature of the class of products to which ampicillin belongs is the presence of an amino group in the alpha position, and that this feature is absent in hetacillin. This is literally true at the time of importation and sale but it ceases to be true as soon as hetacillin is put to use for the only purpose for which it is intended. The substitution for the postulated amino group of the variant incorporated in hetacillin is evanescent and reversible and for all practical purposes of use can be regarded as the equivalent of the amino group in ampicillin. In the apt phrase used by the Court of Appeal, it is the reproduction of the substance ampicillin, albeit temporarily masked. His Lordship was addressing a product claim. In the imported hetacillin, there was a substituent for the amino group in the alpha position, but the substitution of the variant was "evanescent and reversible" and could be regarded as the equivalent of the amino group in the alpha position in the patented drug ampicillin. 666 The Lundbecks draw an analogy with the bromo-diol's performance of the function of the cyano-diol. 667 In Re Application of Eli Lilly & Co [1982] 1 NSWLR 526, it was argued by the Commissioner in an application under s 90 of the Patents Act 1952 (Cth) for an extension of term, that the patentee had not properly exploited the invention. The patent was in respect of a pharmaceutical invention called monensic acid and a new process for producing that product. The patentee had exploited and used commercially only monensin sodium, a salt of monensic acid. The Commissioner argued that the salt was a product chemically distinct from the acid. 668 Wootten J was of the view (at 532) that a proper and convenient way to test the matter was to ask whether the sale of monensin sodium in Australia by another person would be an infringement of the patent. After referring to Beecham,his Honour held (at 534) that "the mere conversion of monensic acid to monensin sodium with the retention of substantially the same molecular structure and the same therapeutic effects, and involving only the use of a simple and well understood process, would fall within the 'pith and marrow' doctrine". 669 In the Canadian case Pfizer Canada Inc v Apotex Inc (1998) 78 CPR (3d) 3, the court stated that the doctrine of equivalents applies to compositions where there is equivalence between chemical ingredients. That approach was followed in the Canadian case Merck Frosst Canada Inc v Canada (Minister of National Health and Welfare) (2000) 8 CPR (4th) 48. In the later case, the court stated, quoting from the earlier one, that "basically, there is equivalence when the substituting ingredient or device 'performs substantially the same function in substantially the same way to obtain the same result'". Accordingly, the court accepted expert evidence that the chemical properties and activities of the substituted ingredient were similar to those of the ingredient that it replaced. That evidence showed that both compounds were electron withdrawing groups and would therefore allow a particular reaction to occur, resulting in the same products. Importantly, the court accepted expert evidence that "a person reasonably skilled in the art would have known of the inter-changeability of that ingredient not contained in the patent with the one that was". Accordingly, the court found infringement proved.

[40]

The evidence 670 In cross-examination, Professor Banwell was taken to the A documents in which, as appears at [650] above, the steps taken were identified as ECT-I through to ECT-VIII. He agreed that ECT-I and ECT-II are steps that take place in order to form the diol precursor, and prior to the first step identified in claim 6(b). Steps ECT-III to ECT-VIII correspond with the integers in claim 6(b) with only one qualification: Step ECT-III uses a bromo-diol, whereas claim 6(b) uses the cyano-diol. It follows that step ECT-VII, which describes the cyanation process that exchanges the CN for the Br, is not an integer of claim 6(b). 671 In re-examination, Professor Banwell said that the (+)-enantiomer of citalopram in the freebase form is obtained at the A step ECT-VII (the second last box in the left column in the table set out at [650] above), that is, when the cyanation process exchanging the CN for the Br occurs. 672 The remaining evidence on the present issue is found in an affidavit of Hans Petersen of 13 December 2006, Exhibit MGB-8 to Professor Banwell's affidavit of 6 March 2007 entitled "Response to Petersen Affidavit", and an affidavit of Professor Davies sworn 30 March 2007 addressing both Mr Petersen's affidavit and Professor Banwell's response to it. 673 Mr Petersen is a Senior Specialist in the Process Research department of Lundbeck. He was instructed to compare the "[A] Process Description" with the process claim found in claim 6 of the Patent. At para 13 of his affidavit, Mr Petersen set out, including in diagrammatic form, each step of the A process and the corresponding step of the example of the Lundbeck process described as "resolution by methods (b) and (c)" on p 7 of the Patent specification. Mr Petersen divides both processes into four corresponding steps. In relation to step 3 ("Exchange from Bromo to Cyano"), he states that the exchange of the bromo group (Br) for a cyano group (CN) to create escitalopram is required only in the A process, since in the Lundbeck process the required cyano group is already in place before Step 1. 674 Mr Petersen makes the following overall comments on his comparison of the two processes: 19. The only difference between the two processes described above is that, in the Lundbeck Process, the cyano group required in the final escitalopram compound is already present in Step 1 whereas, in the [A] Process, a bromo group is present and is exchanged for the cyano group at the end of the process, after ring closure. 20. The cyanation step used in the [A] process is well known for the racemic analogue and has been for many years. In the patent (US 4,136,193) in which the racemate of citalopram was first disclosed, this process of exchanging a bromo group for a cyano group using copper cyanide in DMF was described. In fact, the same patent describes that this cyanation process can be undertaken at various points in the synthetic path to citalopram. One other variation, described in WO 01/49762 A1 is the preparation of 5-cyano-phthalide from the corresponding bromo compound. 675 Mr Petersen also states in his affidavit: 23. I would expect the resolution of either the racemic bromo-diol (as in the [A] Process) or the racemic cyano-diol (as in the Lundbeck Process) to proceed in a very similar manner. This is due to the high degree of similarity between the two diols which include the following factors. (a) There is no difference in the overall skeleton of the two molecules. The only difference is in the two substituents, 5-Br or 5-CN, both of which are at the same position. (b) The substituents (5-Br or 5-CN) are para to the stereogenic centre and on the opposite side of the molecule from the amino group (ending in NMe2) which is the location on the molecule at which salt formation takes place and this distance and orientation reduces the prospect that or degree to which salt formation is influenced by the 5-Br/5-CN substituent. (c) For the purpose of the resolution step, in each diol, there is the same distance between the hydroxyl group, the chiral centre and the amino group. Accordingly, the resolution step is not significantly influenced by the 5-Br/5-CN substituents. (d) Both the 5-Br and 5-CN groups are electronegative substituents. This means that they both attract electrons. This heightens the overall similarity between the two molecules because these substituents have the same way of donating or withdrawing electrons to or from the phenyl ring to which they are bound. A CN group is often referred to as a "psuedohalogen" due to its electron withdrawing effects. (e) Accordingly, the characteristics and reactivity of the bromo-diol are not materially different to the characteristics and reactivity of the cyano-diol. … 31. It is clear to me, and I believe that it would have been apparent to me and any chemist in 1988, that the cyano-diol of the Lundbeck Process could be replaced by the bromo-diol or indeed a diol with any halogen or pseudohalogen in the place of the cyano group, without making any material difference to the way in which the process works. This is because (i) these different substituents have very similar properties, (ii) none of the chemistry involved in the Lundbeck Process involves interaction with these substituents and (iii) these substituents can be replaced with the desired cyano group by a straightforward and well known cyanation process at any stage in the synthetic route. 676 In Exhibit MGB-8 to Professor Banwell's affidavit of 6 March 2007, Professor Banwell addresses Mr Petersen's comparison of the A Process and Claim 6(b) of the Patent. Professor Banwell's main disagreement with Mr Petersen is expressed in paras 5-10 of Exhibit MGB-8 which are as follows : 5. … the two processes represented by Mr Petersen in paragraph 13 have very fundamental and significant differences. The step of the [A] Process described in paragraph 13 (which corresponds to ECT-III in the [A] Documents) shows the aromatic group containing a hydroxymethyl substituent at the 2 position and a bromine (Br) atom substituent at the 4 position. In comparison, the Lundbeck Process involves a cyano (CN) or nitrile group at the same 4 position within the relevant molecule. Bromine and cyano groups are fundamentally different substituents. This difference necessarily changes the inherent chemistry of both compounds, resulting, amongst other things, in different: (a) solubility; (b) melting point; (c) boiling point; (d) rates of crystallisation; and (e) reactivity. 6. The two compounds shown in paragraph 13 of the Petersen Affidavit are not chemically equivalent and, as a result, their respective chemistries are different. 7. The bromo ([A] Process) and cyano (Lundbeck Process) substituents attached to the 4 position on the aromatic group result in different chemical properties that Mr Petersen has overlooked in his analysis. 8. In organic chemistry a cyano group attached to a benzene ring 'behaves' as an electron-withdrawing group and is regarded as a meta-directing group. On the other hand, bromo substituents attached to a benzene ring are considered inductively electron-withdrawing groups but act mesomerically as electron donating groups. Bromo substituents in this chemical arrangement are ortho- and/or para- directing groups. In lay terms this means that these two substituents (CN vs Br) are known to exert quite different effects on the associated aromatic ring and other groups attached to this ring. The replacement of a bromo substituent for a cyano substituent has fundamental chemical consequences. 9. The fundamental chemical differences between bromo and cyano substituents were well known to a skilled addressee well before 14 June 1988 and reported in standard chemistry textbooks such as Morrison and Boyd. 10. It is also noteworthy that Mr Petersen's 3D representation in paragraph 13 of chemical structures in both the [A] Process and Lundbeck Process confirming the stereochemistry of the diastereomeric salts are not in Claim 6 of the Patent. Indeed, the word diastereomer does not appear in Claim 6 at all. Mr Petersen's representation also includes the absolute configuration of S-diol and R-diol in the [A] Process although this is not reported in the [A] documents. Unless Mr Petersen has performed a crystal structure on these respective compounds or, alternatively, carried out spectroscopic or chemical correlation studies, neither Mr Petersen ([n]or anyone else) can assign these absolute configurations as Mr Petersen has done. 677 In his affidavit, Professor Davies expressed general agreement with Mr Petersen's affidavit. He states that in 1988, if he had known the content of the Patent in suit and Lundbeck's previously published patents concerning citalopram and had been trying to arrive at a single enantiomer of citalopram without making use of the cyano-diol, the first thing he would have tried would have been to use the bromo-diol instead, conducting the other steps described in the Patent on the bromo-diol, and, if successful, cyanating bromo-citalopram to citalopram. 678 Professor Davies disagrees with much of Professor Banwell's evidence in Exhibit MGB-8. 679 Professor Davies agrees with Professor Banwell, however, that there can be significant reactivity differences between a bromo and a cyano group, but maintains that such differences have no material effect on the kind of chemistry involved in the patented process. He agrees with Professor Banwell's explanation of the characteristics of a cyano group as being meta-directing, whereas bromo substituents are ortho- or para-directing, but he maintains that this is of relevance only in relation to electrophilic aromatic substitution reactions. The Lundbeck and A processes do not, he explains, involve electrophilic aromatic substitution. 680 Professor Davies says that Professor Banwell overplays the significance of the differences between the bromo and cyano substituents on the relevant chemistry involved in the Lundbeck and A processes, in para 5 of Exhibit MGB-8. Professor Davies agrees that there will be differences in solubility, melting point and so on, but does not believe that there will be any relevant differences in reactivity. 681 Professor Davies strongly disagrees with Professor Banwell's contention in para 8 of Exhibit MGB-8 that the replacement of a bromo-substituent for a cyano-substituent in the A process has relevant fundamental chemical consequences. 682 In relation to Professor Banwell's evidence in para 9 of Exhibit MGB-8, Professor Davies states that both bromo and cyano substituents are electron withdrawing, the only real difference manifesting itself in the product orientation seen in electrophilic aromatic substitution reactions which are not involved in the present case. 683 The step ECT-IV that Professor Banwell, in para 11 of Exhibit MGB-8, states has been omitted by Mr Petersen, relates, according to Professor Davies, to liberation of the salt to return to the free base. Professor Davies says that this is not a step that is material to the processes in question. However, he points out that, at para 23 of Mr Petersen's affidavit, Mr Petersen refers to the resolution steps generally and that it is clear from Example 2 in the Patent specification that the reaction proceeds on the basis of a liberated salt as a base. 684 Professor Davies's conclusions are expressed in paras 30-33 of his affidavit as follows: 30. The Lundbeck and [A] Processes are, in essence, identical with each other. The only differences are that: a. in the [A] Process, resolution and ring-closure are performed on the bromo-diol, rather than the cyano-diol of the Lundbeck Process; and b. in the [A] Process, there is a final cyanation step, derived from a previous Lundbeck patent, to convert the single enantiomer of bromo-citalopram to the single enantiomer of citalopram. 31. The differences between the bromo and cyano substituents are not, in my view, likely to have a material effect on the way the processes work. The differences identified by Professor Banwell in paragraph 5 of MGB-8, would be relevant only if electrophilic aromatic substitution reactions were required, which they are not in the process in question. 32. As I noted in paragraph 9 above, had I, in 1988, knowledge of the patent in suit and Lundbeck's previous published patents concerning citalopram and been trying to arrive at a single enantiomer of citalopram without making use of the cyano-diol, I believe that the first thing that I would have tried would have been substituting the bromo-diol in place of the cyano-diol, conducting the other steps described in the patent in suit on the bromo-diol and, if successful, cyanating bromo-citalopram to citalopram. This is what is described in the [A] Process. 33. I have made all enquiries which I believe are desirable and appropriate. No matters of significance which I regard as relevant have, to my knowledge, been withheld from the Court.

[42]

The definition of "exploit" and importation 691 I set out Alphapharm's submission at [659] above. There is no dispute that the acts of infringement must occur within the patent area, which is for present purposes, Australia (see [659] above). In relation to claim 6(b), "exploit" has the meaning identified in para (b) of the definition of "exploit". Accordingly, in general terms, Alphapharm submits that para (b) provides for two classes of exploitation of a method or process invention:

in Australia, using the method or process; and
in Australia, making, hiring, selling or otherwise disposing of, offering to make, sell, hire or otherwise dispose of, using or importing, or keeping for the purpose of doing any of those things, a product resulting from the use referred to in (1). 692 The difference between the constructions supported by Alphapharm and the Lundbecks concerns the meaning of the expression "the use referred to in (1)". According to Alphapharm, that notion includes the "in Australia" element, whereas according to the Lundbecks it does not. 693 A consequence of the construction supported by Alphapharm is that in the case of an invention which is a method or process, importation is not a form of exploitation unless the product imported had resulted from the use of the method or process in Australia. However, as the Lundbecks submit, where the product results from the use of the method or process in Australia, the very making of the product, having occurred in Australia, would itself be a contravention of the patented method or process (para (a) of the definition of "exploit"). Accordingly, the effect of Alphapharm's submission would be that in the case of an invention of a method or process, the reference to importing is superfluous. 694 I do not think that the construction supported by Alphapharm is correct. There is no suggestion in the express terms of the definition of "exploit" that importation, with nothing more, is not to be a form of exploitation in the case of a patented method or process. The territorial connection with Australia is one that is implied, and the proper construction of the definition of "exploit" has the territorial connection attaching twice, but not three times. The notion of "in Australia" does not follow the expression "from such use" at the end of para (b). The correct construction is, in my view, as follows: exploit, in relation to an invention includes: (a) where the invention is a product - [in Australia, or more accurately, in the patent area] make, hire, sell or otherwise dispose of the product, offer to make, sell, hire or otherwise dispose of it, use or import it, or keep it for the purpose of doing any of those things; or (b) where the invention is a method or process - [in Australia, or more accurately, in the patent area] use the method or process or do any act mentioned in paragraph (a) in respect of a product resulting from [the use, anywhere, of the method or process].

[47]

700 In my opinion, none of these documents are admissible. 701 Documents 4 and 5 relate to foreign patent applications. In each case, the applicant is Lundbeck. Document 4 comprises a Danish patent application that was apparently made on 24 May 1989 in respect of (+)-citalopram and a method for its preparation, and subsequent correspondence between Lundbeck and the Danish Patent Office (DPO). The DPO refused the application, expressing the opinion that the product had not been shown to differ substantially from what was already known prior to the application filing date, including the racemic citalopram, and the fact that almost the entire therapeutic effect resided in one of the optically active antipodes of a racemic compound. The DPO referred to ss 2 and 16 of the Danish Patents Act. The DPO also rejected method claims that were included in the application. 702 While Alphapharm may be encouraged by the fact that the Danish Patent Office accepted arguments somewhat similar to submissions it has put to me, this does not make the Danish file wrapper rationally probative in relation to the issues I have to decide under the Act. In other words, the relevance of the document is not shown. 703 Document 5 is an International Application published under the Patent Cooperation Treaty bearing an international filing date of 12 July 2002 and entitled "Method for the Preparation of Escitalopram". Likewise, its relevance to the issues I have to decide under the Act is not shown. 704 I note that my rulings in relation to Documents 4 and 5 are consistent with certain observations made on applications for orders for discovery by Burchett J in F Hoffmann-La Roche AG v Chiron Corporation (2000) 47 IPR 516 at [19]-[21] and by Branson J in Lubrizol Corporation Inc v Imperial Chemical Industries plc (2000) 50 IPR 526 at [33] (although, unlike the present case, those cases involved the exercise of a discretion and a balancing exercise). 705 Documents 7 and 8 were tendered in order to diminish the effect of Professor Montgomery's evidence, but neither of them was put to him. Their probative value is substantially outweighed by the danger that the evidence might be unfairly prejudicial to Lundbeck, and I refuse to admit them (see s135(a) of the Evidence Act).

[51]

Professor Montgomery 717 Like all other expert witnesses in the case, Professor Montgomery has an impressive curriculum vitae. He graduated with a Bachelor of Science (Honours) degree from the University of London in 1960 and a Bachelor of Medicine and Bachelor of Surgery (MBBS) from University College Hospital, London, in 1963. He received a Diploma in Psychological Medicine (DPM) from the Royal College of Physicians and Surgeons in 1973 and a Doctor of Medicine (MD) from the Karolinska Institute in Stockholm, Sweden, in 1978. Professor Montgomery became a Member in 1973, and then a Fellow, in 1982, of the Royal College of Psychiatrists (FRCPscych). 718 I will not trace the whole of Professor Montgomery's career and experience. In 1978 he, together with a colleague, developed the Montgomery-Asberg Depression Rating Scale (MADRS) to measure levels of depression. Professor Montgomery describes the MADRS as "the most sensitive rating scale for depression" and as being "widely used". 719 Professor Montgomery was successively Senior Lecturer, Reader and then Professor in Psychiatry at St Mary's Hospital Medical School, London (now part of Imperial College School of Medicine, University of London) from 1979 to 1998. In 1999 he was appointed as Emeritus Professor of Psychiatry at the Imperial College of Science, Technology and Medicine, London. 720 Professor Montgomery was a Member of the Council of the Royal College of Psychiatrists from 1980 to 1992, President of the British Association of Psychopharmacology from 1990 to 1992, and President of the European College of Neuropsychopharmacology from 1992 to 1995. 721 Professor Montgomery was a member of the Committee on Safety of Medicines UK (CSM) from 1987 to 1993 and, as the only psychiatrist on the Committee, he considered all applications in the field of psychiatry and neurology at that time, including all of the antidepressants for which marketing approval was sought. He estimates that he completed a total of about 40 expert reports (now called "clinical overviews") to support regulatory applications for central nervous system medication, including for SSRIs and other antidepressants. 722 For 16 years Professor Montgomery has been the editor of International Clinical Psychopharmacology and European Neuropsychopharmacology. He is also on the editorial boards of other scientific journals. 723 Professor Montgomery has published several hundred scientific papers, research reports, reviews and book chapters and has authored some 25 books. 724 Professor Montgomery was awarded the Prix Erasme de Psychiatrie in 1999 by the Free Erasmus University of Brussels, the Neuroscience Award in 2001 by the European College of Neuropsychopharmacology, and a Lifetime Achievement Award in 2006 by the British Association of Psychopharmacology. 725 For more than 30 years, Professor Montgomery's work has involved treating patients suffering from psychiatric illnesses and research into those illnesses, with a particular focus on depression. 726 Professor Montgomery has been consulted by most pharmaceutical companies (he names 15) and chairs Lundbeck's "Global Advisory Board of Experts".

[52]

Professor Montgomery's affidavit 727 I will now give some examples of the passages objected to (except where indicated otherwise, the passages set out below or summarised below, are objected to by either Alphapharm or Arrow, or both). 728 In para 4 of his affidavit, Professor Montgomery refers to a list of publications constituting Exhibit SAM-1 to his affidavit. There are 61 of them, including 12 authored by Professor Montgomery alone, or with co-authors. In relation to the 61 articles, Professor Montgomery states: I have read and am familiar with each of these publications and have considered them for the purposes of preparing this affidavit. Where I refer to a publication in this affidavit, I am referring to the publication as referred to in the list contained in Exhibit SAM-1. Where I refer to each of these publications in the body of my affidavit, unless I or the context indicates to the contrary, I intend to indicate that the cited publication provides, in my view, sound scientific support for the proposition in relation to which I cite the publication. [my emphasis] As foreshadowed in this passage, in later paragraphs, Professor Montgomery made statements followed simply by a citation of author's name and year of publication. 729 In para 6 of his affidavit, Professor Montgomery states that he has been asked by Lundbeck's solicitors to provide a report in relation to : (a) depression and its treatments, including selective serotonin reuptake inhibitors (SSRIs); and (b) the benefits of escitalopram over other SSRIs in general and citalopram in particular. 730 In some instances in his affidavit, Professor Montgomery makes statements of a general conclusory nature without tying them to any particular article or articles. For example, in para 52, he states: The effects of the different SSRIs on neurotransmitter systems and on the liver microsomal oxidase systems involved in drug metabolism are as follows: (a) Citalopram was the most selective of the SSRIs, before the introduction of escitalopram. It is well tolerated by elderly patients and is the one least likely to cause drug-drug interactions. (b) Escitalopram is even more selective and potent and is as well tolerated as citalopram. ... Again, in para 53, Professor Montgomery states: The SSRIs in general, with the exception of escitalopram, have shown a relatively flat dose-response relationship in the fixed dose comparisons with no advantage in producing a better response with higher doses and with some disadvantage in a heavier side-effect burden. With escitalopram, there is evidence that the higher doses are more helpful in severe depression. 731 Paragraphs 70-76 of Professor Montgomery's affidavit were not objected to, except for the last sentence of para 76, which was objected to by Arrow. Although somewhat lengthy, I think it desirable to set out these paragraphs. They appeared under the heading "Overview of Escitalopram" and were as follows: 70. Escitalopram is the active enantiomer of citalopram... 71. Citalopram is a 50:50 racemic mixture of two mirror image molecules, or enantiomers (see below). In 1992 it was believed that only one enantiomer was responsible for the therapeutic effect (Hyttel 19922) [the footnote states "Although published some years after the patent in suit, the Hyttel 1992 paper is based upon the data contained in the patent in suit".]. In those circumstances, eliminating the enantiomer which is not responsible for producing the desired therapeutic effect, could have been expected to result in a more specific drug with potentially fewer side effects but without improved clinical effect. The interpretation of adverse reactions and drug-drug interactions is also easier if only one enantiomer is present. The issue of drug-drug interactions is of particular importance in patient populations, such as depressed patients, in which polypharmacy frequently occurs. Furthermore, regulatory authorities favoured enantiomerically pure drugs. 72. In 1988, knowledge of the importance of, and different effects of, individual enantiomers was not widespread. 73. At that time (1988), there was no information publicly available as to whether both enantiomers or only one of them was responsible for the therapeutic effect of Citalopram. There was no publicly available information suggesting that the R enantiomer of citalopram had a negative effect. If only one enantiomer was responsible for the therapeutic effect, by eliminating the enantiomer which was not responsible for producing the desired therapeutic effect, I, and I believe other clinicians, would have expected that a drug would be more specific with potentially fewer side effects, but without improved clinical effect. In other words, I, and I believe other clinicians, would have expected that where one enantiomer is practically devoid of therapeutic effect, separating a racemate into its individual enantiomers would result in similar efficacy at half the dose. 74. As I have noted ... above, I sat on the Committee on Safety of Medicines UK (CSM) from 1987 to 1993. The approach taken by the CSM in 1988 to racemates and separate enantiomers was that it was nice to receive data in relation to separate enantiomers of pharmaceutical products. However, if the data in relation to a racemate was that the racemate was therapeutically active and there was no pressing rationale, such as toxicity or other unwanted side effects, to separate the racemate, then there was no reason to do so. 75. I was aware in 1988 of pharmaceutical industry practice to try to separate a chiral compound into its individual enantiomers in order to check for unwanted receptor affinities and potential deleterious side effects. However, this practice did not extend to separating chiral compounds into their individual enantiomers to ascertain whether one had a beneficial or deleterious effect on the compounds efficacy. In 1988 close attention was not yet paid to enantiomers and I would not have expected an active enantiomer with the same or similar receptor affinities as the racemate to have any benefits over and above a racemate which did not have deleterious or unwanted effects. 76. In 1988, knowledge that one enantiomer was practically devoid of 5-HT reuptake inhibitory potential, had it been available, would have led me, and I believe other clinicians, to the expectation that the drug profile would be at least as good as citalopram at half the dose. On this basis, the ratio of predicted efficacy would be that a half-dose of escitalopram would produce the same degree of inhibition of 5-HT reuptake as a full dose of citalopram. However, as discussed below unexpected differences in favour of escitalopram have been found. It will be noted that these paragraphs describe the position as at the priority date. 732 In paras 77-78, Professor Montgomery states: Serotonin Uptake Inhibition 77. In vitro and in vivo studies have shown that escitalopram is a more potent SSRI than citalopram, and that the R-enantiomer is practically devoid of 5-HT uptake inhibitory potency. Animal Models and the Attenuating Effects of the R-Enantiomer 78. Citalopram is active in several well-accepted animal models predictive for antidepressant effect. It is therefore not surprising that escitalopram has also been found to be active in these same animal models. The R-enantiomer was practically devoid of 5-HT reuptake effects, confirming the in vitro data. Senior counsel for Lundbeck said that he relied on para 77 only to introduce the subject and not as independent opinion evidence in its own right. 733 In many places in his affidavit, Professor Montgomery cites articles in support of statements, thereby indicating acceptance of the conclusions in those articles (as contemplated by para 4 of his affidavit set out at [728] above). For example, paras 79-81 of his affidavit are as follows: 79. The surprising finding in studies with some of these animal models has been the earlier response to escitalopram compared with citalopram. In the rat model of chronic mild stress (Willner 1997), administration of TCAs such as imipramine, or conventional SSRIs, normalizes sucrose intake after three to four weeks of treatment. This is in line with the characteristic delayed onset of antidepressant effect observed in the clinic. In contrast, escitalopram produced a complete antidepressant-like effect after only one week of treatment (Sanchez 2000, Montgomery 2001). This earlier response with escitalopram was unexpected, suggesting that the R-enantiomer might modulate the effect of the S-enantiomer, delaying the antidepressant action. 80. The role of the R-enantiomer has been investigated further in a series of preclinical studies, which have shown that the R-enantiomer reduces the positive effect of the S-enantiomer (Mork 2003). Consequently, escitalopram shows earlier and greater efficacy than when the R- and S-enantiomers are given together (Mork 2003, Chen 2005, Sanchez 2004). Serotonin Transporter Allosteric Binding Site 81. Escitalopram, compared to other SSRIs and SNRIs, is unique in having, in addition to its 5-HT reuptake inhibitory effects, a pronounced effect via an affinity-modulating allosteric site (Chen 2005). The allosteric binding site has been reported to modulate the binding to the primary site and thereby enhance the binding (Plenge 1991). Escitalopram has been shown to increase the stabilization of the binding to the serotonin transporter via the allosteric mechanism compared to other SSRIs and venlafaxine (Chen 2005). This unique self-enhancing effect on the serotonin transporter goes a long way to explain the obvious clinical superiority of escitalopram as an antidepressant and as an anxiolytic. 734 Alphapharm makes the point that parts of the paragraphs set out above come almost directly from a booklet written by Professor Montgomery, Pocket Pharma: Escitalopram and Depression (Science Press Ltd, 2003, pp 24-25), and suggests that this may explain the form that the affidavit takes. While I acknowledge that there is a danger in assuming that the content of a book written by the deponent of an affidavit can simply be put into affidavit form, I must assess the affidavit and objections to it on their merits.

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The nature of Alphapharm's General Relevance Objection 735 The General Relevance Objection relates to paragraphs directed to showing that escitalopram has proved to be therapeutically far more effective than citalopram. Alphapharm submits, firstly, that a difference in therapeutic effect as between the two is irrelevant to the questions arising under s 25A of the TG Act. Alphapharm emphasises that the statutory question arising under the TG Act is whether, when Lundbeck lodged its application for TGA approval of escitalopram oxalate, another therapeutic good "consisting of, or containing" the same active component was already included in the ARTG. According to Alphapharm's submission, that question is not answered by reference to the superior efficacy of escitalopram over citalopram. 736 Secondly, and for a similar reason, Alphapharm submits that in the Lundbeck Appeal (Extension of Term) Proceeding, the statutory question for consideration under s 70 of the Act and reg 10.7 of the Patents Regulations for the purpose of ascertaining the "first regulatory approval date" is not answered by evidence of the present kind. 737 Thirdly, Alphapharm submits that in so far as evidence of the kind mentioned is said to be relevant to the validity of the Patent in the Revocation Proceeding, "after-acquired knowledge" concerning the superior benefits of the invention cannot buttress a claim for the presence of an inventive step. 738 Accordingly, Alphapharm submits that Professor Montgomery's evidence of the kind mentioned is not relevant in any of the three proceedings mentioned. Arrow supports Alphapharm's objection made in the Revocation Proceeding for the purposes of the Arrow Proceeding. 739 Lundbeck countered the General Relevance Objection in the Revocation Proceeding and the Arrow Proceeding on the basis that the evidence was relevant to the issue of obviousness. Lundbeck submits that Professor Montgomery's evidence goes to, for example: (i) there having been little motivation to separate and test the enantiomers of citalopram when the racemate was safe and effective (ii) the unexpected superior clinical properties of escitalopram, including its superior efficacy, earlier onset of action, it being more effective in the more severely depressed patients, and it being effective in a greater number of patients than citalopram and other SSRIs; ... 740 Lundbeck also submitted that Professor Montgomery's evidence is relevant to showing that escitalopram has different pharmacological and clinical effects, which, it says, is relevant, in relation to TGA (Protected Information) Proceeding, to the issue whether citalopram consists of or contains the same active component as escitalopram, and, in relation to the Lundbeck Appeal (Extension of Term) Proceeding, to the issue whether escitalopram is a different pharmaceutical substance per se from citalopram.

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Consideration of Alphapharm's General Relevance Objection 741 In relation to inventive step, it is the common general knowledge, understandings and expectations of the hypothetical skilled non-inventive addressee or team as at the priority date that matter. As noted in Section E at [224], I accept Professor Montgomery's evidence and that of other witnesses: · that it was common general knowledge at the priority date that it was possible that at most all of the beneficial effects of citalopram might reside in one enantiomer, the other being mere "ballast"; and, if so, · that by means of using a single enantiomer, all the benefits of citalopram might be obtained from half the dosage. I do not accept, however, that it was part of common general knowledge at that time that it was possible that one enantiomer might be many times more therapeutically effective than the racemate. 742 The Patent specification accords with the position as I have described it in the preceding paragraph. It states: Furthermore, it was shown to our surprise that almost the entire 5 H-T uptake inhibition resided in the (+)-citalopram enantiomer. If it surprised the inventors that "almost the entire 5 H-T uptake inhibition resided in the (+)-enantiomer" [my emphasis] it must have also been very surprising to them to learn after the priority date that the (+)-enantiomer gave many times the therapeutic benefits given by citalopram. 743 There is a series of decisions of the various courts of the United States in which it has been accepted that unexpected superiority in effectiveness is probative of non-obviousness: see, for example, Sterling Drug Inc v Watson 135 F Supp 173 (1955) at 175-176; In re Gershon, 372 F 2d 535 (1967) at 537; In re Skoner, 517 F 2d 947 (1975) at 950; Ex parte Sohda 2002 WL 519757 at 2-3; In re Chupp, 816 F 2d 643 (1987) at 646-647; Ortho-McNeil Pharmaceutical Inc v Mylan Laboratories Inc 348 F Supp 2d 713 at 755-756. 744 In some of these cases it has been said that the evidence of unexpected superior clinical benefits has been admitted to counter prima facie obviousness arising from other evidence. I do not find other evidence in the present case raising a prima facie case of obviousness. In any event, this was not a basis of admissibility relied upon by Lundbeck. 745 In Canada, it has been suggested that in relation to obviousness, little weight should be given to "subsequently recognised advantages": see Janssen-Ortho Inc v Novapharm Ltd [2006] Carswell Nat 3249 at 113, 114. 746 In oral submissions, senior counsel for Lundbeck stated: In terms of obviousness, the opinion as to how predictable this material was is relevant. It's not advanced for the proposition that because there was this unexpected benefit, that somehow makes it inventive. That's not what we're saying. We're simply not advancing that argument. But we are advancing the argument on motivation. If you didn't expect this unexpected benefit, then the fact that you have this massive benefit doesn't mean that you were motivated to move mountains to get there. The problem with this basis of admissibility is that Alphapharm does not rely upon escitalopram's having far superior therapeutic benefits to those of citalopram as establishing motivation. In fact, by its objection, Alphapharm is seeking to keep out Professor Montgomery's evidence that escitalopram was later found to have therapeutic benefits far superior to those of citalopram. 747 In Wellcome, Aickin J, with whom the other members of the High Court agreed, stated (at 287): ... not all inventions are to be classified as fulfilling a long-felt want. Those which reveal an "unfelt want" are as likely, or sometimes more likely, to involve an inventive step. In Astra at [38], Gleeson CJ, Gaudron, Gummow and Hayne JJ approved of this passage. However, neither Aickin J in Wellcome nor their Honours in Astra were saying that evidence of unexpected benefits is admissible. Rather, the point they were making was that evidence of previous unsuccessful attempts to satisfy a long-felt want, while admissible, might not be entitled to much weight since inventive step can be present, not only in the presence of a long-felt want and associated motivation, but also in their absence. 748 It seems to me that Lundbeck has set up a "straw man" to knock down. In the light of the nature of the case that Lundbeck had to counter, it was only evidence of what was commonly known and expected at the priority date that it was entitled to seek to prove. Evidence of post-priority date surprises did not fall within that description. 749 Since arriving at the conclusion expressed in the last paragraph, I have read what Kitchin J has said on the present issue in Generics v Lundbeck at [231]-[237] and the passages from the authorities to which his Lordship refers, namely, Richardson-Vicks Inc's Patent [1995] RPC 568 at 581 and Glaxo Group Ltd's Patent [2004] RPC 43 at [113]. I note that my conclusion is generally in line with those three authorities. 750 In summary, while I would admit any parts of Professor Montgomery's affidavit that go to the pre-priority date common general knowledge and expectations of the hypothetical skilled but non-inventive addressee or team as to the benefits to be found in a separate enantiomer, I do not admit the passages tendered to prove that the post-priority date clinical studies and data established that in fact the therapeutic benefits of escitalopram far exceeded those expectations. 751 In relation to the Lundbeck Appeal (Extension of Term) Proceeding, Professor Montgomery's evidence showing that escitalopram has different pharmacological and clinical effects was initially potentially relevant to the question of whether Cipramil consisted of or contained the pharmaceutical substance (+)-citalopram because of submissions made by Lundbeck as to the meaning and application of provisions of the TG Act. However, I have now rejected Lundbeck's submissions in that respect (see Section K above), and the evidence is therefore shown to be irrelevant. 752 Finally, in relation to the TGA (Protected Information) Proceeding, Lundbeck Australia contended that Professor Montgomery's evidence showing that citalopram and escitalopram have different pharmacological properties and effects was relevant to the question whether Cipramil can be said to consist of or contain (+)-citalopram. According to the submission, his evidence was relevant to that question because of Lundbeck Australia's submission as to the meaning and application of the expression "active component". However, again, I have now rejected Lundbeck's submission in that respect too (see Section L above), and so the evidence is shown to be irrelevant. 753 In sum, the General Relevance Objection is sustained in the Lundbeck Appeal (Extension of Term) Proceeding and the TGA Proceeding and, to the extent mentioned, in the Revocation Proceeding and the Arrow Proceeding.

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The nature of Alphapharm's Factual Basis Objection 754 Alphapharm submits: 415. ... Professor Montgomery articulates a series of opinions regarding the efficacy of citalopram vs (+) citalopram on the basis of his interpretation of reports or articles, which in turn report the results of certain clinical studies (most of which were conducted by or on behalf of Lundbeck). 416. No person has given evidence regarding the conduct of those studies, the underlying data concerning the studies has not been provided and there has been no disclosure of primary documents that might reveal (for instance) the aims, objectives or methodology of those studies. The authors of the Journal Articles relied upon have not given evidence. As submitted above, Alphapharm was able to call the pooled studies seriously into question, on the basis of limited material. 417. The Journal Articles themselves constitute reports of selected information taken from and summarized as the results from clinical studies. Further, there is no evidence as to the existence of other unpublished studies the results of which may be unhelpful to the Lundbeck arguments. Professor Montgomery does not refer to the underlying data, but relies on the results as reported in the Articles. 418. The Journal Articles themselves are at times opaque as to the studies upon which their conclusions are based ... Further, not all of the studies upon which the Montgomery expert evidence is based were published. 419. Accordingly, the basis upon which Professor Montgomery has expressed his opinions is hearsay evidence which cannot be admitted as evidence of the truth of its contents. 420. Alphapharm submits that, in the absence of proof of that factual basis, the evidence of Professor Montgomery in this regard is inadmissible. 755 Alphapharm relies on a passage from the well-known judgment of Heydon JA (as his Honour then was) in Makita (Australia) Pty Limited v Sprowles (2001) 52 NSWLR 705 (Makita) at [85]: In short, if evidence tendered as expert opinion evidence is to be admissible, it must be agreed or demonstrated that there is a field of "specialised knowledge"; there must be an identified aspect of that field in which the witness demonstrates that by reason of specified training, study or experience, the witness has become an expert; the opinion proffered must be "wholly or substantially based on the witness's expert knowledge"; so far as the opinion is based on facts "observed" by the expert; they must be identified and admissibly proved by the expert, and so far as the opinion is based on "assumed" or "accepted" facts, they must be identified and proved in some other way; it must be established that the facts on which the opinion is based form a proper foundation for it; and the opinion of an expert requires demonstration or examination of the scientific or other intellectual basis of the conclusions reached: that is, the expert's evidence must explain how the field of "specialised knowledge" in which the witness is expert by reason of "training, study or experience", and on which the opinion is "wholly or substantially based", applies to the facts assumed or observed so as to produce the opinion propounded. If all these matters are not made explicit, it is not possible to be sure whether the opinion is based wholly or substantially on the expert's specialised knowledge. If the court cannot be sure of that, the evidence is strictly speaking not admissible, and, so far as it is admissible, of diminished weight. 756 Lundbeck submits that it has not been accepted in this Court that an expert's opinion is inadmissible if it is based on assumed or accepted facts that are not identified and proved, citing: Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Ltd (2002) 55 IPR 354 (Sydneywide) at [16] per Branson J and [87] per Weinberg and Dowsett JJ); Neowarra v Western Australia (No 1) (2003) 134 FCR 208 at [16], [21]-[27] per Sundberg J; Jango v Northern Territory (No 4) (2004) 214 ALR 608 at [19] per Sackville J; NutraSweet Australia Pty Ltd v Ajinomoto Co Inc (2005) 67 IPR 381 at [33] per Finkelstein J; Cadbury Schweppes Pty Ltd v Darrell Lee Chocolate Shops Pty Ltd (2006) 228 ALR 719 at [7] per Heerey J. 757 I do not think it necessary to review all of these cases. 758 It is necessary to distinguish between two potential meanings of the notion of a "basis rule". The expression may be used to refer to a supposed rule that evidence of expert opinion is not admissible unless the expert identifies the assumed factual basis for his or her opinion, thereby distinguishing between what is opinion and what is not. This goes to the form taken by the expert's evidence. The provisions of s 79 of the Evidence Act tend to have the practical effect of requiring attention to the form that expert evidence takes: HG v The Queen (1999) 197 CLR 414 at [39] per Gleeson CJ. As I noted in Harrington-Smith v State of Western Australia (No 2) (2003) 130 FCR 424 at [25], in the absence of a distinction between opinion and assumed factual basis, the Court may not be able to be satisfied: · as to what is the opinion proffered; · that the facts assumed by the expert are sufficiently like the actual facts to make the opinion relevant for the purposes of s 56 of the Evidence Act (see Quick v Stoland Pty Ltd (1998) 87 FCR 371 (Quick v Stoland) at 374 per Branson J; Sydneywide at [14] per Branson J); or · that the opinion is one substantially based on the expert's specialised knowledge, for the purposes of s 79 of the Evidence Act (see Makita at [85] per Heydon JA). 759 On the other hand, the expression "basis rule" may be used to refer to a supposed rule that evidence of expert opinion is not admissible unless the factual basis of the opinion is proved by admissible evidence. 760 Generally speaking, Professor Montgomery's evidence is not criticised for not identifying the basis of his opinions: he identifies precisely enough the journal articles on which he relies, and where he does not attribute a statement to a particular article, he is making only an introductory statement (for example, para 77 of his affidavit which was set out at [732] above) or giving an overall summary of the effect of all of the articles. What is put by Alphapharm is that Professor Montgomery's opinions are not admissible because the factual basis for them, being the actual carrying out and recording of the results of the clinical studies reported in the journal articles, were not proved by admissible evidence (see para 416 of Alphapharm's submissions set out at [754] above).

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Consideration of Alphapharm's Factual Basis Objection 761 The starting point for resolution of Alphapharm's General Relevance Objection is a particular group of exceptions to the hearsay rule that were recognised under the general law as being dictated by necessity. In the Law Reform Commission's Interim Report on Evidence (ALRC No 26, 1985), the Commission described these exceptions as (a) the expert's accumulated knowledge, (b) the reported data of fellow scientists, and (c) information commonly relied upon in an industry, trade or calling (ALRC No 26 vol 1 at [131], vol 2 at [91]). The Commission cited in support: English Exporters (London) Ltd v Eldonwall Ltd [1973] 1 Ch 415; R v Abadom [1983] 1 WLR 126; Borowski v Quayle [1966] VR 382 (Borowski); H v Schering Chemicals Ltd [1983] 1 All ER 849 (Schering Chemicals); Reid v Kerr [1974] 9 SASR 367; Rowley v London and North Western Railway Co (1873) LR 8 Exch 221; Dickins v Randerson [1901] 1 KB 437; R v Perryman (1907) 147 CCC Sess Pap 109 (Lawrence J). There is some overlap between the three categories. 762 The Commission referred, as an illustration of (b), to Borowski, in which the following passage from Wigmore on Evidence, Chadbourn JH (ed) (Little, Brown & Co, Boston, 1979) vol 2 at [665b], was cited with approval: The data of every science are enormous in scope and variety. No one professional man can know from personal observation more than a minute fraction of the data which he must every day treat as working truths. Hence a reliance on the reported data of fellow scientists, learned by perusing their reports in books and journals. The law must and does accept this kind of knowledge from scientific men…[T]o reject a professional physician or mathematician because the fact or some facts to which he testifies are known to him only upon the authority of others would be to ignore the accepted methods of professional work and to insist on finical and impossible standards…..In general, the considerations which define the (professional) are (a) a proper source of information, (b) an extent of personal observation in the general subject, enabling him to estimate the general plausibility, or probability of soundness, of the views expressed, and (c) the impossibility of obtaining information on the particular technical detail except through reported data in part or entirely. The true solution must be to trust the discretion of the trial judge, exercised in the light of the nature of the subject and the witness' equipments. The decisions show in general a liberal attitude in receiving technical testimony based on professional reading.

[57]

In Borowski, his Honour found (at 386) that evidence given by the expert in that case: …would have been directed to matter travelling outside opinion and dependent to a degree upon knowledge based upon hearsay. But this is an area where the hearsay rule does not apply and the matter dealt with in the evidence would clearly have been admissible. 763 This passage was cited with approval in Reid v Kerr [1974] 9 SASR 367, 370, and the necessity of the approach reflected in it was noted in Schering Chemicals at 854. 764 The same judge-made exception to the hearsay rule was recognised in the standard texts on evidence at that time: see, for example, D Byrne QC and JD Heydon, Cross on Evidence (3rd Australian Edition, Butterworths, 1986) at [15.31], [17.161], citing, in addition to Borowski and Schering Chemicals, See v Milner (1980) 2A Crim R 210 (FCA); Holt v Auckland City Council [1980] 2 NZLR 124; Cuthill v State Electricity Commissioner of Victoria [1981] VR 908 at 915 (FC); Baker v Australian Asbestos Insulations Pty Ltd [1984] 3 NSWLR 595 at 607. 765 The Law Reform Commission dealt with the present issue under the heading "Evidence Admissible for a Non-hearsay Purpose" (ALRC No 26 Vol 1 at [685]) stating (footnotes omitted): Under existing law hearsay evidence that is admissible for a non-hearsay purpose is not excluded, but may not be used by the court as evidence of the facts stated. This involves the drawing of unrealistic distinctions. The issue is resolved by defining the hearsay rule as preventing the admissibility of hearsay evidence where it is relevant by reason only that it would affect the court's assessment of the facts intended to be asserted. This would have the effect that evidence relevant for a non-hearsay purpose - eg to prove a prior consistent or inconsistent statement, or to prove the basis of the expert's opinion - will be admissible also of evidence of the facts stated: Tender of Prior Consistent and Inconsistent Statements ............... Expert's evidence of Basis of Opinion Reference has been made above to the uncertainties that exist as to the admissibility of such evidence and to the unclear exceptions which have had to be created to meet the problems created by the hearsay rule. Under the proposal, evidence by an expert of the facts on which his opinion is based will be admissible as evidence of those facts. Potential dangers have been raised. First, there is the danger that false evidence may be placed before the court. However, the expert will usually form a judgment about the accuracy of what he is told. In addition the tactical pressure on the parties to verify the facts relied upon by the expert should ensure that problems of assessment of the evidence will not arise. They will either call more direct evidence or have to face adverse comment. When assessment problems do arise, the exclusionary discretions may be used. This is similar to the present approach. Another danger suggested is that it could result in an increase in evidence adduced - particularly that which is adduced in the Family Court and is of marginal relevance. As at present, the expert will do no more than adduce evidence of the basis of his opinion - what he was told will be relevant to that opinion and the assessment of it. However, the relevance proposal and relevance discretion will apply and give the courts express control where now that control and its extent is unclear. It has also been suggested that parties will want to answer the allegations of marginal relevance and this will give rise to an increase in the evidence given. However, this should not occur. First the party against whom the evidence is led can object to the relevance of the facts related by the expert - only those affecting his opinion will be relevant. As to such facts, that party will have to decide, as at present, whether he accepts those facts or wishes to challenge them. He would have to do this whether the evidence was admitted as the basis of the expert's opinion or to prove the facts asserted - it would be a foolish party who relied on that distinction in relation to key factual elements and did not call rebutting evidence. The proposal in fact has the potential to save time and costs. At present, the party leading the expert evidence should lead non-hearsay evidence to confirm all the statements made to and relied upon by the court. If he does not, it will be open to the opposing party to argue that the opinion should be rejected - the hearsay rile will lie in wait. Under the proposal he can call witnesses to confirm the key material, and leave it up to the opposing party to cross-examine the witness to raise the matters in issue. If he does not and leads evidence in rebuttal, it will be possible for the first party to call further evidence. 766 The result of the Commission's deliberations was s 60 of the Evidence Act. The hearsay rule itself is set out in s 59 of that Act. Section 59(1) provides: Evidence of a previous representation made by a person is not admissible to prove the existence of a fact that the person intended to assert by the representation. 767 Section 60 provides for an exception to the hearsay rule as follows: The hearsay rule does not apply to evidence of a previous representation that is admitted because it is relevant for a purpose other than proof of the fact intended to be asserted by the representation. 768 A "previous representation" is defined in the Dictionary to the Evidence Act to be a representation made otherwise than in the course of the giving of evidence in the proceeding in which evidence of the representation is sought to be adduced. 769 The representations made by the authors of the articles cited by Professor Montgomery are "previous representations" as to the carrying out of the clinical studies and the results of them. 770 Sections 59 and 60 are perhaps an odd way of grappling with the present issue. It seems clear, however, that it was intended that in a case like the present one, statements of the bases for expert opinions like those made by Professor Montgomery were to be characterised as being relevant for a purpose other than proof of the facts intended to be asserted by the representations by the authors of the articles. Prior to the enactment of s 60, the summaries given by Professor Montgomery of the effect of the journal articles would have been ruled admissible as falling within the exceptions dictated by necessity referred to at [761]-[765] above. 771 In their joint report, Uniform Evidence Law: Reportof December 2005, the Australian, New South Wales and Victorian Law Reform Commissions have recognised that s 60 had the effect of excluding from the hearsay rule an expert's statement of the factual basis of his or her opinion (see [7.74] ff). The Commissions recognised (at [7.74]) that an expert relies on "statements made to him or her by others about their observations of events which are facts in issue, together with a wide range of factual information from more remote sources". The Commissions gave as illustrations: · knowledge acquired by experts from reading the work of other experts and from discussion with them; · the reported data of fellow experts relied upon by such persons as scientists and technical experts in giving expert opinion evidence; · factual material commonly relied upon in a particular industry or trade or calling. The Commissions also recognised that, through necessity, there existed those judge-made exceptions to the hearsay rule referred to at [761] above. In addition to Borowski, they cited PQ v Australian Red Cross Society [1992] 1 VR 19; R v Vivona (Unreported, Victorian Court of Criminal Appeal, Crockett, Tadgell and Teague JJ, 12 September 1994); R v Fazio (1997) 93 A Crim R 522. The Commissions then stated at [7.77], [7.78] (footnotes omitted): 7.77 The proposal that became s 60 was formulated with these exceptions in mind, with the intention that s 60 would perform the role the miscellaneous common law exceptions had performed and the complication of specific exceptions for these kinds of evidence avoided. 7.78 Section 60 also applies to representations of fact unique to the particular case upon which the expert bases his or her opinion. Such evidence is hearsay at common law, but s 60 lifts the statutory hearsay rule in that situation. 772 It will be recalled that the Law Reform Commission noted at [685] of ALRC No 26 Vol 1 (set out at [765] above) that "[p]otential dangers [of the application of s 60] have been raised", including that false evidence may be placed before the Court. However, it stated that "the expert will usually form a judgment about the accuracy of what he is told". It also stated that when "assessment problems [in relation to the evidence] do arise, the exclusionary discretions [a reference to Part 3.11 of that Evidence Act] may be used". Such a use of s 136 of the Evidence Act (which falls within Part 3.11 of the Evidence Act) was referred to by Finkelstein J in Quick v Stoland at 382 and by Nicholson J in Daniel v State of Western Australia (2000) 178 ALR 542 at [30]-[34]. 773 Section 136 of the Evidence Act is entitled "General discretion to limit use of evidence" and provides: The court may limit the use to be made of evidence if there is a danger that a particular use of the evidence might: (a) be unfairly prejudicial to a party; or (b) be misleading or confusing. 774 As noted earlier, Alphapharm and Arrow ask the Court to exercise its discretion under s 136 in relation to the evidence constituting the factual basis of Professor Montgomery's opinion. 775 In a sense, it is true, as Alphapharm submits, that the relevant parts of Professor Montgomery's evidence consist of a review of scientific literature. This characterisation, however, does not adequately reflect the significance of his testimony. A person lacking his "specialised knowledge based on [his] training, study or experience" (see s 79 of the Evidence Act) would not know how to go about locating relevant articles, would not be able to distinguish between relevant and the irrelevant ones, would not be able to interpret the articles, and would not be able to assess their overall effect in the light of the questions on which his opinion evidence is required. Part of Professor Montgomery's specialist knowledge is precisely knowledge of the identity of the scientific journals that publish research carried out within his area of expertise, knowledge of the clinicians who have been working and publishing in the area, and knowledge of the relevance and reliability of their published work in relation to the questions raised. 776 Professor Montgomery gave evidence of the peer-review process that is followed in the case of the two journals of which he has been the editor for approximately the last 16 years. Three or four reviewers are approached, with the possibility of substitutes if any of those approached initially prove to be too slow in providing their comments as reviewers. The article will be accepted for publication if the reviewers so recommend. The reviewers may suggest amendments which, in Professor Montgomery's experience, only rarely have authors declined to adopt. If, for any reason, reviewers cannot be found for an article, it will not be accepted for publication. Professor Montgomery said that, in the case of both of the journals of which he is editor, approximately 75% of the articles submitted are rejected, some of them out of hand. 777 While Professor Montgomery did not give evidence of the peer-review process that is followed in the case of the other journals in which the articles he cited were published, I infer that all of those journals in which they were published were peer reviewed and that their editors followed a generally similar peer review process to that followed by Professor Montgomery himself. 778 It is true that when the Parliament enacted s 60, it was considered that Part 3.11 of the Evidence Act, which contains s 136, would act as a safeguard to limit the operation of s 60 in appropriate circumstances (see [765], [772] above). However, I will not make an order under s 136. The evidence with which I am concerned is the evidence of Professor Montgomery's opinions. If the opinions were otherwise admissible, I would not think it appropriate to limit the use to be made of them pursuant s 136. 779 Ultimately, if the scientific community, represented here by Professor Montgomery, accepts as a sufficient basis for the forming of opinions, the reportings of clinical studies published in peer-reviewed articles in scientific journals of high repute, I do not see why the Court should interfere by limiting the use to be made of the opinions. 780 The weight to be accorded to Professor Montgomery's opinions remains a matter for the Court. Criticisms made by Alphapharm of particular opinions expressed by him are to be taken into account as going to the weight to be given to those opinions (see Quick v Stoland at 378 per Branson J; Welsh v The Queen (1996) 90 A Crim R 364 at 369, 371). Indeed, as Lundbeck itself states in its submissions: If Alphapharm doubts the validity of the reports or articles to which Lundbeck's expert witnesses have referred, it is entitled to question the credibility of these reports or articles (as has been done by Dr Mitchell in his affidavit). His Honour is then invited to make a determination of the validity of these arguments based upon the cross-examination of Dr Mitchell and of Professor Montgomery and use this determination as one of the factors in deciding the weight to be afforded to a particular expert's evidence. In fact, Alphapharm adduced evidence from Professor Mitchell countering that of Professor Montgomery and addressing the post-priority date studies mentioned by him. Because Alphapharm's General Relevance Objection has succeeded, that evidence of Professor Mitchell was rendered irrelevant. 781 This seems to me to reflect the only practicable way in which opinion evidence of the kind given by Professor Montgomery can be dealt with. In this respect, I note the statement made by Cooke J in Seyfang v G D Searle & Co [1973] QB 148 at 151: It does appear to me with the greatest respect that a system which does not permit experts to refer in their expert evidence to the publications of other experts in the same field is a system which puts peculiar difficulties in the way of proof of matters which depend on expert opinion. 782 I have not overlooked the decision of the High Court in Lee v The Queen (1998) 195 CLR 594 or Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd (No 3) (2006) 229 ALR 179. I do not think, however, that they stand against the approach that I have taken above. 783 In my opinion, for the reasons given above, s 60 of the Evidence Act defeats the Factual Basis Objection. I would have declined to make an order under s 136 of that Act if the passages objected to had not succumbed to the General Relevance Objection.

Parties

Applicant/Plaintiff:

Alphapharm Pty Ltd

Respondent/Defendant:

H Lundbeck A/S

Legislation Cited (9)

Patents Act 1990(Cth)ss 70, 71, 77, ss 13(3), 18, 40, 70, 71, 77, 78, 119A

Therapeutic Goods Act 1989(Cth)ss 25A, 26B

Evidence Act 1995(Cth)ss 59, 60, 136

Patents Regulations 1991(Cth)reg 10.7

Therapeutic Goods Regulations 1990(Cth)

Judiciary Act 1903(Cth)

Patents Act 1952(Cth)

Acts Interpretation Act 1901(Cth)

Intellectual Property Laws Amendment Act 2006(Cth)

Cases Cited (66)

FEDERAL COURT OF AUSTRALIA Alphapharm Pty Ltd v H Lundbeck A/S [2008] FCA 559

Patents Act 1990 (Cth) ss 13(3), 18, 40, 70, 71, 77, 78, 119A Therapeutic Goods Act 1989 (Cth) ss 25A, 26B Evidence Act 1995 (Cth) ss 59, 60, 136 Patents Regulations 1991 (Cth) reg 10.7 Therapeutic Goods Regulations 1990 (Cth) Sch 9 Acme Bedstead Co Ltd v Newlands Bros Ltd (1937) 58 CLR 689 cited Advanced Building Systems Pty Ltd v Ramset Fasteners (Aust) Pty Ltd (1998) 194 CLR 171 cited Aktiebolaget Hässle v Alphapharm Pty Ltd (2002) 212 CLR 411 applied Angiotech Pharmaceuticals v Conor [2007] RPC 20 cited Atlantis Corporation Pty Ltd v Schindler (1997) 39 IPR 29 distinguished Beecham Group Ltd v Bristol Laboratories Ltd (1977) 1B IPR 665 referred to Boehringer Ingelheim International GmbH v Commissioner of Patents (2001) 112 FCR 595 discussed Borowski v Quayle [1966] VR 382 cited Bristol-Myers Squibb Co v FH Faulding & Co Ltd (2000) 97 FCR 524 cited Burroughs Corporation (Perkins's Application) [1974] RPC 147 cited Cadbury Schweppes Pty Ltd v Darrell Lee Chocolate Shops Pty Ltd (2006) 228 ALR 719 cited CCOM Pty Ltd v Jiejing Pty Ltd (1994) 51 FCR 260 cited Clorox Australia Pty Ltd v International Consolidated Business Pty Ltd (2006) 68 IPR 254 cited Décor Corporation Pty Ltd v Dart Industries Inc (1988) 13 IPR 385 cited EI Dupont De Nemours & Co v Imperial Chemicals Industries plc (2002) 54 IPR 304 cited F Hoffman-La Roche & Co AG v Commissioner of Patents (1971) 123 CLR 529 cited F Hoffmann-La Roche AG v Chiron Corporation (2000) 47 IPR 516 cited Flexible Steel Lacing Co v Beltreco Ltd (2000) 49 IPR 331 cited Flour Oxidising Co Ltd v Carr & Co Ltd (1908) 25 RPC 428 cited General Tire & Rubber Co v Firestone Tyre & Rubber Co Limited [1972] RPC 457 cited Generics (UK) Ltd v H Lundbeck A/S [2007] RPC 32 referred to Glaxo Group Ltd's Patent [2004] RPC 43 cited H Lundbeck A/S v Generics (UK) Ltd [2008] EWCA 311 referred to Harrington-Smith v State of Western Australia (No 2) (2003) 130 FCR 424 referred to HG v The Queen (1999) 197 CLR 414 cited Hill v Evans (1862) 1A IPR 1 cited Imperial Chemical Industries Pty Ltd v Commissioner of Patents (2005) 213 ALR 399 cited In re Adamson (1960) 275 F 2d 952 not followed In re O'Farrell (1988) 853 F 2d 894 at 903) cited Jango v Northern Territory (No 4) (2004) 214 ALR 608 cited Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (2004) 217 CLR 274 cited Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) (2007) 235 ALR 202 referred to Lubrizol Corporation Inc v Imperial Chemical Industries plc (2000) 50 IPR 526 cited Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705 referred to Merck & Co Inc v Arrow Pharmaceuticals Ltd (2003) 59 IPR 226 discussed Merck Frosst Canada Inc v Canada (Minister of National Health and Welfare) (2000) 8 CPR (4th) 48 referred to Meyers Taylor Pty Ltd v Vicarr Industries Ltd (1977) 137 CLR 228 cited Minnesota Mining and Manufacturing Co v Beiersdorf (Australia) Ltd (1980) 144 CLR 253 applied Minnesota Mining and Manufacturing Co v Tyco Electronics Pty Ltd (2002) 56 IPR 248 cited National Research Development Corporation v Commissioner of Patents (1959) 102 CLR 252 cited Neolab Ltd and others v H Lundbeck AS 3 Ni 9/05 (EU)cited Neowarra v Western Australia (No 1) (2003) 134 FCR 208 cited Nesbit Evans Group Australia Pty Ltd v Impro Ltd (1997) 39 IPR 56 cited Nicaro Holdings Pty Ltd v Marlin Engineering Co (1990) 91 ALR 513 cited NutraSweet Australia Pty Ltd v Ajinomoto Co Inc (2005) 67 IPR 381 cited Olin Corporation v Super Cartridge Co Pty Ltd (1977) 180 CLR 236 cited Olin Mathieson Chemical Corporation v Biorex Laboratories Limited [1970] RPC 157 cited Ortho-McNeil Pharmaceutical Inc v Mylan Laboratories Inc 348 F Supp 2d 713 approved Pfizer Canada Inc v Apotex Inc (1998) 78 CPR (3d) 3 referred to Pfizer Overseas Pharmaceuticals v Ely Lilly & Co (2005) 225 ALR 416 cited Pharmacia Corporation v Merck & Co Inc [2002] RPC 775 cited Pharmacia Italia SpA v Mayne Pharma Pty Ltd (2006) 69 IPR 1 discussed PhotoCure ASA v Queen's University at Kingston (2005) 216 ALR 41 cited Prejay Holdings Ltd v Commissioner of Patents (2003) 57 IPR 424 discussed Ranbaxy Australia Pty Ltd v Warner-Lambert Company LLC (No 2) (2006) 71 IPR 46 referred to Re Application of Eli Lilly & Co [1982] 1 NSWLR 526 referred to Rehm Pty Ltd v Websters Security Systems (International) Pty Ltd (1988) 11 IPR 289 cited Richardson-Vicks Inc's Patent [1995] RPC 568 cited Root Quality Pty Ltd v Root Control Technologies Pty Ltd (2000) 177 ALR 231 cited Saccharin Corporation Ltd v Anglo-Continental Chemical Works Ltd (1900) 17 RPC 307 referred to Sachtler GmbH & Co KG v RE Miller Pty Ltd (2005) 65 IPR 605 cited Seyfang v G D Searle & Co [1973] QB 148 cited Société Des Usines Chimiques Rhône-Poulenc v Commissioner of Patents (1958) 100 CLR 5 cited Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Ltd (2002) 55 IPR 354 cited Wellcome Foundation Ltd v V.R. Laboratories (Aust) Pty Ltd (1981) 148 CLR 262 cited Wm Wrigley Jr Company v Cadbury Schweppes Pty Ltd (2006) 66 IPR 298 followed

Proceeding NSD 1078 of 2006 (the Lundbeck Appeal (Extension of Term) Proceeding) 45 I turn last to proceeding NSD 1078 of 2006 (the Lundbeck Appeal (Extension of Term) Proceeding). This proceeding is an appeal by Lundbeck from part of a decision of the Commissioner, by her delegate, Dr SD Barker, issued on 19 May 2006. That decision was a decision to direct that the entry in the Register in respect of the Patent be amended by alteration of the expiry of the extension on the ground that the extended term was not calculated from the "first regulatory approval date" referred to in s 77 of the Act, with the consequence that reg 10.7(7) of the Patents Regulations 1991 (Cth)(the Regulations) required the Commissioner to amend the Register by bringing forward the expiry of the Patent. 46 (In H Lundbeck A/S v Commissioner of Patents [2006] FCA 163, I held that reg 10.7(7) was intra vires s 228 of the Act. Bennett J followed me in Pfizer Corporation v Commissioner of Patents (No 2) (2006) 69 IPR 525, and on appeal from her Honour, the Full Court agreed with us: see Pfizer Corporation v Commissioner of Patents (2006) 155 FCR 578. An application by Pfizer Corporation for special leave to appeal to the High Court was refused: see [2007] HCA Trans 93.) 47 As noted earlier, on 27 May 2004 the Commissioner granted the extension. No opposition was entered to the grant of it in the time provided by the Regulations. However, Alphapharm later wrote to the Commissioner asserting that the Commissioner had been misled by Lundbeck as to the true first regulatory approval date. On 13 July 2005, the Acting Deputy Commissioner of Patents copied Lundbeck into correspondence stating that the Commissioner considered that she was obliged to amend the entry in the Register of the expiry of the term of the Patent from 13 June 2014 to 9 December 2012 under reg 10.7(7) of the Regulations. This was on the footing that the correct first regulatory approval date was 9 December 1997, the date of the registration of Cipramil in the ARTG. 48 The Commissioner's letter requested Lundbeck either to provide reasons why the Commissioner should not make the amendment or to accede to the amendment. Lundbeck did not accede to the amendment and there was a hearing before Dr Barker at which Lundbeck and Alphapharm made submissions. This led to the decision of 19 May 2006 from which Lundbeck now appeals, as it is entitled to do under s 154 of the Act and reg 10.7(9) of the Regulations. 49 Regulations 10.7(7), (8) and (9) provide: (7) If: (a) an extension of the term of a standard patent for a pharmaceutical substance has been granted under section 76 of the Act; and (b) the Commissioner becomes aware that the first regulatory approval date in relation to the pharmaceutical substance is earlier than: (i) the date of commencement of the first inclusion in the Australian Register of Therapeutic Goods that was supplied, under subregulation 6.9(2), with the application for the extension of the term; or (ii) the date of the first approval that was supplied, under subregulation 6.10(2), with the application for the extension of the term; the Commissioner must amend the relevant entry in the Register to insert the correct extension of the term of the patent. (8) If the Commissioner proposes to amend an entry in the Register under subregulation (7), the Commissioner must: (a) give notice to that effect to the patentee; and (b) act in accordance with regulations 22.22 to 22.24 as if those regulations applied to a decision to amend an entry. (9) An appeal lies to the Federal Court against a decision of the Commissioner to amend the Register under subregulation (7). 50 Regulations 22.22 to 22.24, referred to in para (8)(b), provide for the giving of notice and of an opportunity to be heard, before the Commissioner exercises a discretionary power adversely to a person. 51 Dr Barker decided that the decision of Wilcox J in Merck & Co Inc v Arrow Pharmaceuticals Ltd (2003) 59 IPR 226 (Merck) governed the issue before him. As Dr Barker understood the position, Merck produced the result that it did not matter that escitalopram was a new chemical entity having properties different from those of the racemate, citalopram, or that the registration of citalopram under its brand name Cipramil on the ARTG did not give the right to market escitalopram except as part of the racemate. All that mattered was that Cipramil did in fact "contain" escitalopram, or put another way, that escitalopram was present (to some extent) in Cipramil, and that Cipramil was included in the ARTG. It was also immaterial, according to Dr Barker, that escitalopram was not responsible for all of the activity of Cipramil. 52 Dr Barker concluded that since citalopram hydrobromide, marketed under the brand name Cipramil and containing escitalopram, was first registered on the ARTG on 9 December 1997, the Commissioner was required by reg 10.7(7) to amend the relevant entry in the Register to reflect the correct extension of the term of the Patent as expiring on 9 December 2012 (see [32] above). 53 Lundbeck complains that the Dr Barker erred in finding that the first regulatory approval date was the date on which Cipramil was registered on the ARTG, and that Dr Barker ought to have found that it was the date on which Lexapro was so registered (see [33] above).

The Escitalopram Patents 7. The UK Escitalopram Patent, being patent application No 8814057 filed in Great Britain on 1 June 1989 with a priority date of 14 June 1988. 8. The EU Escitalopram Patent, being European patent No 0 347 066, based on the application for the UK Escitalopram Patent being for "New enantiomers and their isolation". (The validity of the EU Escitalopram Patent has been the subject of three decisions: · the decision of Justice Kitchin given on 4 May 2007 in Generics (UK) Ltd v H Lundbeck A/S (Generics v Lundbeck)in the Patents Court, Chancery Division, High Court of Justice and reported at [2007] RPC 32 ; · the decision on appeal from that decision of the English Court of Appeal given on 10 April 2008 in H Lundbeck A/S v Generics (UK) Ltd [2008] EWCA 311; and · the decision of the German Federal Patent Court given on 27 August 2007 in proceeding number 3 Ni 9/05 (EU), Neolab Ltd v H Lundbeck AS.) 9. The Australian Escitalopram Patent, being Australian patent No 623144 dated 9 June 1989 (application filed on 13 June 1989), based on the application for the UK Escitalopram Patent, being for "(+) Enantiomer of Citalopram and process for the preparation thereof" - the Patent. 10. The US Escitalopram Patent, being United States patent No 4,943,590 dated 24 July 1990, based on the application for the UK Escitalopram Patent, being for "pharmaceutically useful (+)-1-(3-dimethylaminopropyl)-1-(4'-fluorophenyl)-1,3-dihydroisobenzofuran-5-carbonitrile and non-toxic acid addition salts thereof". 11. The US Re-issued Escitalopram Patent, being United States patent No 34,712 dated 30 August 1994 (a re-issue of the US Escitalopram Patent) based on the application for the UK Escitalopram Patent and being for "pharmaceutically useful (+)-1-(3-dimethylaminopropyl)-1-(4'-fluorophenyl)-1,3-dihydroisobenzofuran-5-carbonitrile and non-toxic acid addition salts thereof". (The validity of this US Re-issued Escitalopram Patent was the subject of a decision of the United States District Court for the District of Delaware given on 13 July 2006 in Forest Laboratories Inc v Ivax Pharmaceuticals Inc 438 F Supp 2d 479 (2006) and of the decision on appeal from that decision, given on 5 September 2007 by the United States Court of Appeals for the Federal Circuit in Forest Laboratories Inc v Ivax Pharmaceuticals Inc 501 F 3d 1263 (2007).)

The test of novelty and the question of enabling disclosure 157 It is common ground that the basic test for lack of novelty in Australia is the "reverse infringement test", which was enunciated by Aickin J in the following well-known passage in Meyers Taylor Pty Ltd v Vicarr Industries Ltd (1977) 137 CLR 228 at 235: The basic test for anticipation or want of novelty is the same as that for infringement and generally one can properly ask oneself whether the alleged anticipation would, if the patent were valid, constitute an infringement ... This rule is stated in Blanco White TA, Patents for Inventions and the Protection of Industrial Design (5th ed, Stephens, London, 1983) at [4-102] as follows: The test for lack of novelty is essentially the same as the test for infringement; that is to say, a prior use will invalidate a claim if it was such that it would infringe that claim if carried out after the grant of the patent concerned; while a prior disclosure will invalidate if it contains a clear description of, or clear instructions to do or make, something that would infringe if carried out after grant. 158 Lundbeck submits that there are two elements of the reverse infringement test: first, that the alleged anticipation must disclose all of the essential features of the particular claim it is said to anticipate; and, second, that the alleged anticipation must have enabled the addressee to carry out the invention. Alphapharm submits: "The submissions of Lundbeck misapplied the doctrine of enabling disclosure, even assuming it applies in Australia". Alphapharm submits, however, that the applicability of the doctrine need not be decided because there is no dispute that the Australian Citalopram Patent "enabled" the racemate, that is, the positive enantiomer, but only with the negative enantiomer in equal proportions. Clearly, the issue of the proper construction of claim 1 discussed above directly arises. 159 Both parties rely on the following passage from the English Court of Appeal's judgment in General Tire & Rubber Co v Firestone Tyre & Rubber Co Limited [1972] RPC 457 at 485-486: If the prior inventor's publication contains a clear description of, or clear instructions to do or make, something that would infringe the patentee's claim if carried out after the grant of the patentee's patent, the patentee's claim will have been shown to lack the necessary novelty, that is to say, it will have been anticipated. The prior inventor, however, and the patentee may have approached the same device from different starting points and may for this reason, or it may be for other reasons, have so described their devices that it cannot be immediately discerned from a reading of the language which they have respectively used that they have discovered in truth the same device; but if carrying out the directions contained in the prior inventor's publication will inevitably result in something being made or done which, if the patentee's patent were valid, would constitute an infringement of the patentee's claim, this circumstance demonstrates that the patentee's claim has in fact been anticipated. If, on the other hand, the prior publication contains a direction which is capable of being carried out in a manner which would infringe the patentee's claim, but would be at least as likely to be carried out in a way which would not do so, the patentee's claim will not have been anticipated, although it may fail on the ground of obviousness. To anticipate the patentee's claim the prior publication must contain clear and unmistakeable directions to do what the patentee claims to have invented: Flour Oxidising Co LtdvCarr & Co Ltd (1908) 25 RPC 428 at 457, line 34, approved in BTH Co Ltdv Metropolitan Vickers Electrical Co Ltd (1928) 45 RPC 1 at 24, line 1. A signpost, however clear, upon the road to the patentee's invention will not suffice. The prior inventor must be clearly shown to have planted his flag at the precise destination before the patentee. [my emphasis] This passage has been followed in Lubrizol at [61] and in numerous other cases. 160 In my opinion, it is clear that the earlier disclosure must be "enabling": see for example, Hill v Evans at 8 ("the antecedent statement must be such that a person of ordinary knowledge of the subject would at once perceive, understand and be able practically to apply the discovery without the necessity of making further experiments and gaining further information before the invention can be made useful"); Flour Oxidising Co Ltd v Carr & Co Ltd (1908) 25 RPC 428 at 457 per Parker J ("clear and unmistakable directions so to use [the earlier apparatus]"); Acme Bedstead Co Ltd v Newlands Bros Ltd (1937) 58 CLR 689 at 707 per Dixon J; Olin Corporation v Super Cartridge Co Pty Ltd (1977) 180 CLR 236 at 260-262 per Stephen and Mason JJ; Nicaro Holdings Pty Ltd v Marlin Engineering Co (1990) 91 ALR 513 at 531-532 per Gummow J (the supposed anticipation must not require of the skilled but non-inventive addressee "the exercise of any inventive ingenuity and the taking of any inventive step"); Bristol-Myers Squibb Co v FH Faulding & Co Ltd (2000) 97 FCR 524 at [67] per Black CJ and Lehane J ("must give a direction or make a recommendation or suggestion which will result, if the skilled reader follows it, in the claimed invention"); Imperial Chemical Industries Pty Ltd v Commissioner of Patents (2005) 213 ALR 399 at [61] ff per Crennan J; Pfizer v Eli Lilly at [313]-[324] per French and Lindgren JJ. 161 What does "enabling disclosure" mean in the context of a product claim? It means that the earlier disclosure must point unmistakeably to the (+)-enantiomer of citalopram, as distinct from the racemate, as a drug desirable to obtain.

Relevant law 175 Obviousness is perhaps the most critical aspect of the Revocation Proceeding (and the Arrow Proceeding). This appears to be the first time an Australian patent relating to a single enantiomer has been challenged on the ground of obviousness (the obviousness ground was abandoned in Ranbaxy Australia Pty Ltd v Warner-Lambert Company LLC (No 2) (2006) 71 IPR 46 (Ranbaxy) as noted by Young J at [15]). 176 The history of the emergence of obviousness or lack of inventive step as a distinct ground of invalidity has been recently traced by the High Court in Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) (2007) 235 ALR 202 (Lockwood v Doric (No 2)) at [38]-[49], and by a Full Court of this Court in Ajinomoto Co Inc v NutraSweet Australia Pty Ltd [2008] FCAFC 34 at [63]-[91]. I need not discuss that history. 177 As noted at [55] above, the Patent can be revoked under the Act only on a ground of invalidity that would have been available under the 1952 Act. Obviousness was treated differently under the 1952 Act from the way in which it is treated under the Act. Section 100(1) of the 1952 Act provided: A standard patent may be revoked, either wholly or in so far as it relates to any claim of the complete specification ... on one or more of the following grounds, but on no other ground: ... (e) that the invention, so far as claimed in any claim of the complete specification ... was obvious and did not involve an inventive step having regard to what was known or used in Australia on or before the priority date of that claim;… 178 The question of what was obvious is assessed from the perspective of the hypothetical non-inventive skilled addressee or team in the field of the invention, taking into account "what was known or used" (referred to as "common general knowledge"): Minnesota Mining and Manufacturing Co v Beiersdorf (Australia) Ltd (1980) 144 CLR 253 (Minnesota v Beiersdorf). This position is now effectively codified in ss 7(2) and 18(1)(b) of the Act, provided s 7(3) is put to one side. 179 In Minnesota v Beiersdorf at 292-295 and in Aktiebolaget Hässle v Alphapharm Pty Ltd (2002) 212 CLR 411 (Astra) at [57] it was held in relation to s 100(1)(e) of the 1952 Act that publications are not to be taken into account unless their content was part of common general knowledge at the priority date. Accordingly, the issue is not whether it was obvious to conduct a literature search of a particular kind with a view to acquiring information, but whether the information that would have been obtained from the search had already entered the body of common general knowledge: Minnesota v Beiersdorf at 295; Astra at [45]. No question arises in this case regarding the results of a routine literature search. 180 The High Court also held in Astra (at [50]-[53]) that obviousness was to be determined by asking whether a hypothetical non-inventive skilled addressee, equipped with the common general knowledge as at the priority date, would have taken steps towards the invention "as a matter of routine" in the expectation that they might well produce the invention or some other useful result (endorsing statements in Wellcome Foundation Ltd v V.R. Laboratories (Aust) Pty Ltd (1981) 148 CLR 262 (Wellcome) at 286 and Olin Mathieson Chemical Corporation v Biorex Laboratories Limited [1970] RPC 157 (Olin) at 187-188). The High Court has therefore insisted on the two elements: (1) being led as a matter of routine to the desired result; and (2) having a reasonable expectation of achieving that result. 181 In so holding, the High Court rejected a less demanding "worth a try" or "obvious to try" test. Astra therefore stands for the rejection of a line of United Kingdom authority to the effect that "all of the courses of action which present themselves without the exercise of invention are obvious": Pharmacia Corporation v Merck & Co Inc [2002] RPC 775 at 818 (see Astra at [54] per Gleeson CJ, Gaudron, Gummow and Hayne JJ). Their Honours explained that "[t]he tracing of a course of action which was complex and detailed, as well as laborious, with a good deal of trial and error, with dead ends and the retracing of steps [a description taken from the judgment of the trial Judge] [was] not the taking of routine steps to which the hypothetical formulator [would be] taken as a matter of course" (at [58]; also per Callinan J at [185]). 182 I am aware of the observations made by the English Court of Appeal in relation to the High Court's judgment in Astra in Angiotech Pharmaceuticals v Conor [2007] RPC 20 at [39]-[45] which were quoted by Kitchin J in Generics v Lundbeck at [73]. Those observations are of no relevance to my task. 183 Astra also stands as authority for the following propositions: · It is erroneous to characterise as obvious, the variation of all parameters or the trying of all choices until one proves successful, where the prior art did not point to it (at [76], approving a statement to that effect by Rich J in In re O'Farrell (1988) 853 F 2d 894 at 903); · It is erroneous to characterise as obvious, the exploration of a new technology or a promising field of experimentation, where the prior art gave no more than general guidance (at [76], again approving a statement to that effect by Rich J in In re O'Farrell (1988) 853 F 2d 894 at 903); · It is not acceptable to start from the invention when determining whether it was obvious because this approach "succumbs immediately to the seduction of hindsight" (at [78]). 184 In Gambro Pty Ltd v Fresenius Medical Care South East Asia Pty Ltd (2004) 61 IPR 442 (Gambro), Allsop J pointed out (at [353]) that it is wrong to divide up the inventive process into conception and practical implementation: it is the whole that must be considered and it suffices that there is only one inventive step involved (see also National Research Development Corporation v Commissioner of Patents (1959) 102 CLR 252 at 262). 185 Evidence of the patentee's own lack of success in earlier attempts is probative of the inventive nature of a successful solution to a problem (Wellcome at 287); the question of what weight is to be given to that evidence will depend on all the circumstances including the patentee's qualifications and experience in the field of the invention. Inventions that reveal an "unfelt want or need" are as likely or sometimes more likely to involve an inventive step as those that fulfil a "long-felt want" (Wellcome at 287; Astra at [38]).