Aspen Pharma Pty Ltd v H Lundbeck A/S

Counsel for the Second Respondent: The Second Respondent was excused from attendance

Solicitor for the Second Respondent: Australian Government Solicitor

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2236 of 2012

JUDGES: JESSUP, JAGOT AND YATES JJ DATE OF ORDER: 18 NOVEMBER 2013 WHERE MADE: SYDNEY

1. The amended notice of appeal be dismissed with costs. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2236 of 2012

JUDGES: JESSUP, JAGOT AND YATES JJ DATE: 18 NOVEMBER 2013 PLACE: SYDNEY

JESSUP J 1 I agree with Yates J. I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment herein of the Honourable Justice Jessup.

Associate: Dated: 18 November 2013 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2236 of 2012

JUDGES: JESSUP, JAGOT AND YATES JJ DATE: 18 NOVEMBER 2013 PLACE: SYDNEY

Jagot J 2 I have read the judgment of Yates J and agree with his Honour's reasons and the orders proposed. I certify that the preceding one (1) numbered paragraph is a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot.

Associate: Dated: 18 November 2013 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2236 of 2012

JUDGES: JESSUP, JAGOT AND YATES JJ DATE: 18 november 2013 PLACE: SYDNEY

Yates J 3 This is an appeal from a decision of the Administrative Appeals Tribunal (the Tribunal) brought pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act). The Tribunal affirmed a decision of the delegate of the second respondent, the Commissioner of Patents (the Commissioner), to grant an extension of time to the first respondent, H Lundbeck A/S (Lundbeck), within which to apply for an extension of the term of Patent No. 623144 (the patent) pursuant to s 70(1) of the Patents Act 1990 (Cth) (the Act).

Citalopram 4 Citalopram is a selective serotonin reuptake inhibitor which is useful in the treatment of depression, in particular, Major Depressive Disorder. Citalopram was the subject of an Australian patent owned by Lundbeck, which expired on 5 January 1993. 5 The hydrobromide salt of citalopram is marketed by the local subsidiary of Lundbeck under the name Cipramil. Cipramil was first included in the Australian Register of Therapeutic Goods (the ARTG) on 9 December 1997. 6 Citalopram is a racemate. A racemate is a mixture of two different (mirror-image) forms of the same chemical compound. These forms are called enantiomers. Enantiomers are classified according to two independent criteria, based on: the physical property of rotating plane-polarised light in solution - where the enantiomers are designated (+) (dextrorotatory) or (-) (levorotatory) depending on the direction that plane-polarised light is rotated; and the spatial configuration of the subject molecules in a 3D model of the compound - where the enantiomers are designated R (clockwise) or S (anti-clockwise) depending on the direction of rotation when the subject molecule is positioned according to certain standard rules. 7 Cipramil contains both enantiomers of citalopram.

The patent: escitalopram 8 The patent discloses and claims the (+)-enantiomer of citalopram, called escitalopram (or S-citalopram), and its non-toxic acid addition salts (including, in particular, its pamoic acid salt). The patent also claims pharmaceutical compositions containing, and methods of preparing, escitalopram. 9 The application for the patent was filed on 13 June 1989 as a Convention application. The application was accepted on 24 February 1992 and sealed, without opposition, on 31 August 1992. The term of the patent expired on 13 June 2009. 10 Escitalopram oxalate is marketed by the local subsidiary of Lundbeck under the name Lexapro. Lexapro was first included in the ARTG on 16 September 2003.

Extensions of term of standard patents relating to pharmaceutical substances 11 Part 3 of Chapter 6 of the Act provides that the term of a standard patent relating to a pharmaceutical substance can be extended. The patentee of such a patent may apply to the Commissioner for an extension of term if certain requirements are satisfied: s 70(1). The requirements are set out in s 70(2), (3) and (4) of the Act. 12 First, either or both of the following conditions must be satisfied: One or more pharmaceutical substances per se must in substance be disclosed in the complete specification of the patent and in substance fall within the scope of the claim or claims of that specification. One or more pharmaceutical substances when produced by a process that involves the use of recombinant DNA technology, must in substance be disclosed in the complete specification of the patent and in substance fall within the scope of the claim or claims of that specification: s 70(2). 13 Secondly, both of the following conditions must be satisfied in relation to at least one of those pharmaceutical substances: Goods containing, or consisting of, the substance must be included in the ARTG. The period beginning on the date of the patent and ending on the first regulatory approval date for the substance must be at least five years: s 70(3). 14 Thirdly, the term of the patent must not have been previously extended under Part 3 of Chapter 6 of the Act: s 70(4). 15 Section 71 of the Act provides for the form in which such an application can be made and the time within which such an application can be brought. The time requirement is important in this matter. Section 71(2) provides: An application for an extension of the term of a standard patent must be made during the term of the patent and within 6 months after the latest of the following dates: (a) the date the patent was granted; (b) the date of commencement of the first inclusion in the Australian Register of Therapeutic Goods of goods that contain, or consist of, any of the pharmaceutical substances referred to in subsection 70(3); (c) the date of commencement of this section. 16 The Commissioner must accept an application for an extension of term if satisfied that the requirements of s 70, and the form and time requirements of s 71, are satisfied in relation to the application: s 74(1) of the Act. If the application is accepted, the Commissioner must publish a notice of acceptance in the Official Journal: s 74(2)(b). 17 The Minister or any other person may, in accordance with the Patents Regulations 1991 (Cth) (the Regulations), oppose the grant of an extension of term on the ground that the requirements of s 70 and s 71 are not satisfied. The grant of an extension cannot be opposed on any other ground: s 75(1) of the Act. 18 The patentee and any opponent may appeal to the Court against a decision of the Commissioner in respect of an extension of term: s 75(4) of the Act. 19 The period of any extension of term is calculated according to the prescriptions of s 77(1), but must not exceed five years: s 77(2) of the Act.

Extensions of time 20 Section 223 of the Act provides for extensions of time in relation to acts required to be done under the Act within a certain time. 21 Section 223(2) provides: Where, because of: (a) an error or omission by the person concerned or by his or her agent or attorney; or (b) circumstances beyond the control of the person concerned; a relevant act that is required to be done within a certain time is not, or cannot be, done within that time, the Commissioner may, on application made by the person concerned in accordance with the regulations, extend the time for doing the act. 22 The time allowed for doing a relevant act may be extended, whether before or after that time has expired: s 223(3). 23 The meaning of "relevant act", as used in s 223(2), assumes particular importance in the present matter. Relevantly, it means an action in relation to a patent, other than a "prescribed action": s 223(11). Regulation 22.11(4)(b) of the Regulations, in the form relevant to this proceeding, identifies the following action as a prescribed action: … filing, during the term of a standard patent as required by subsection 71 (2) of the Act, an application under subsection 70 (1) of the Act for an extension of the term of the patent; 24 Certain applications must be advertised. Section 223(4) provides: The Commissioner must advertise in the Official Journal: (a) an application made for an extension of time for more than 3 months; or (b) an application made for an extension of time for doing a prescribed relevant act in prescribed circumstances. 25 Relevantly, reg 22.11(3)(a) of the Regulations identifies the following act as a prescribed relevant act for the purposes of s 223(4): For subsection 223(4) … : (a) the payment of a continuation fee or a renewal fee within the 6 month period mentioned in subregulation 13.3 (1A) or 13.6 (2) is a prescribed relevant act; 26 Relevantly, reg 22.11(3)(b) identifies the following circumstances as prescribed circumstances: For subsection 223(4) … : (b) the prescribed circumstances are that the fee is not paid within that 6 month period mentioned in subregulation 13.3 (1A) or 13.6 (2). 27 A person may, as prescribed, oppose the granting of an application under s 223(2): s 223(6). Application may be made to the Tribunal for review of a decision of the Commissioner under s 223: s 224(1)(a) of the Act.

The application to extend the term of the patent 28 On 22 December 2003, Lundbeck applied for an extension of the term of the patent, based on the date that Lexapro was first included in the ARTG. On 27 May 2004, this application was granted by the Commissioner, without opposition. The term of the patent was extended to 13 June 2014. An entry to that effect was duly made in the Register of Patents (the Register). 29 On 6 July 2005, the fourth applicant (Alphapharm) commenced a proceeding in this Court for revocation of the patent and removal of the entry in the Register recording the extension of term. On 7 July 2005, Alphapharm's solicitors notified the Commissioner of the earlier inclusion of Cipramil on the ARTG on 9 December 1997. Alphapharm contended that the extension of term application could and should have been sought by reference to the date of that entry because Cipramil contained as its active ingredient a racemate that included escitalopram. The consequence, according to Alphapharm, was that Lundbeck's extension of term application, although made during the term of the patent, was, nevertheless, made out of time in light of the requirement of s 71(2)(b) of the Act. In short, the extension of term application should have been made no later than 9 June 1998. 30 On 13 July 2005, the Commissioner determined that the extension of term should have been based on the date that Cipramil was first included in the ARTG. The Commissioner then sought to correct the Register, relying on reg 10.7(7) of the Regulations which, at the relevant time, provided: 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. 31 In the result, the Commissioner adjusted the term of the extension to 9 December 2012 by applying the formula in s 77 of the Act to the first inclusion of Cipramil in the ARTG: Alphapharm Pty Ltd v H Lundbeck A/S (2006) 69 IPR 629. Neither Alphapharm nor Lundbeck agreed with that course. 32 On 24 April 2008, Lindgren J found that the correct regulatory approval date for the extension of term application was the first inclusion of Cipramil in the ARTG. However, the consequence of this finding was not merely that the term of the extension should be more limited, as the Commissioner had determined. His Honour found that Lundbeck's application for an extension of term was out of time. As the time requirement of s 71(2) of the Act had not been met, his Honour ordered that the Register be rectified by removing the recordal that the Commissioner had made: Alphapharm Pty Ltd (ACN 002 359 739) v H Lundbeck A/S and Another (2008) 76 IPR 618 at [544]; see also [28] to [33]. A subsequent appeal to a Full Court against this judgment was unsuccessful: H Lundbeck A/S and Another v Alphapharm Pty Ltd and Another (2009) 177 FCR 151 at [111], [247] and [250]. 33 Final orders were made by the Full Court on 12 June 2009, the day before the term of the patent expired. Later on 12 June 2009, Lundbeck made an application pursuant to s 223(2) of the Act for an extension of time within which to file an application to extend the term of the patent (the extension of time application). The extension sought was 121 months (just over 10 years). 34 Each of the applicants launched their own generic products containing escitalopram in mid-June 2009, shortly after the original term of the patent expired. 35 On 9 July 2009, Lundbeck filed an application for special leave to appeal to the High Court. The application was refused on 11 December 2009: Alphapharm Pty Ltd v H Lundbeck A/S [2009] HCATrans 324 (11 December 2009). 36 On 9 February 2010, the Commissioner amended the Register by removing the recordal relating to the extension of term. 37 The applicants opposed Lundbeck's extension of time application. Four oppositions were filed and heard together. On 1 June 2011, the Commissioner's delegate granted the extension of time: Alphapharm Pty Ltd and Others v H Lundbeck A/S (2011) 92 IPR 628.

the tribunal's decision 38 The issues for the Tribunal were whether s 223(2) of the Act conferred power on the Commissioner to grant the extension of time application and, if so, whether the correct or preferable decision was to grant the extension or to refuse it. The Commissioner's delegate had found that, in the circumstances of the present case, the Commissioner had the power to grant the extension and that the extension should be granted. The Tribunal specifically noted the following passage from the delegate's decision: [91] Regulation 22.11(4)(b) does not exclude s 70 applications from the provisions of s 223 provided these are filed within the term of the patent as required by s 71(2). In the current case, the s 70 application was filed 1 day before the original term of the patent had expired and therefore s 223 is generally available as a remedy to extend the time set out in s 71(2)(c) provided the requirements of s 223 are fulfilled. [92] The patentee's misunderstanding of the law led to their failure to apply for an extension of time based on the correct ARTG registration. While 121 months is an undoubtedly a long time, it is still reasonable in the circumstances given the uncertainty in the law and the length and complexity of the multiple court proceedings. [93] While the opponents would be disadvantaged by the grant of the s 223, this is because of their commercial strategy to enter the market despite being aware of the earlier registration. This was a consequence of their own actions not those of the patentee and is not a discretionary factor against the granting of the extension. [94] The purpose of the extension of term provisions is to encourage research and development into new pharmaceutical drugs by ensuring adequate recompense for patentees for new and inventive drugs. In the current case, the patentee is entitled to an extension of term under s 70 because of delays in marketing approval. In such circumstances, the patentee should be provided with the opportunity to correct a genuine misunderstanding. While there is some disadvantage to the public because of the likely increased cost of the patented drugs for the short period of the extension, this is offset by the broader public interest of encouraging research and development in the pharmaceutical field. [95] I therefore grant the s 223 extension of time to file the extension of term application. Subject to any appeal or review, the Commissioner will proceed to process the section 70 extension of term. If the Commissioner is advised of an appeal or review within 30 days, she will defer consideration of the extension of term until after that action is finally disposed of. 39 After setting out some background facts in its reasons, the Tribunal proceeded to consider, separately: whether s 223 did confer power on the Commissioner to grant the extension of time application; whether, in the present case, Lundbeck had made an error or omission of the kind to which s 223 refers; whether Lundbeck's conduct disentitled it on discretionary grounds to the extension of time it had sought; whether, in that connection, the granting of the extension of time would result in hardship to the applicants; and whether, in that connection, the granting of the extension of time would be against the public interest. 40 The Tribunal reached conclusions on these issues that were favourable to Lundbeck. In the result, it affirmed the delegate's decision. It will be necessary to refer to the Tribunal's reasons, conclusions and findings of fact in greater detail when considering each of the grounds of appeal.

the grounds of appeal 41 The applicants' appeal to this Court can only be on a question of law: s 44(1) of the AAT Act. 42 In Waterford v The Commonwealth of Australia (1987) 163 CLR 54, Brennan J said (at 77): A finding by the A.A.T. on a matter of fact cannot be reviewed on appeal unless the finding is vitiated by an error of law. Section 44 of the A.A.T. Act confers on a party to a proceeding before the A.A.T. a right of appeal to the Federal Court of Australia "from any decision of the Tribunal in that proceeding" but only "on a question of law". The error of law which an appellant must rely on to succeed must arise on the facts as the A.A.T. has found them to be or it must vitiate the findings made or it must have led the A.A.T. to omit to make a finding it was legally required to make. There is no error of law simply in making a wrong finding of fact. … 43 It is trite that an appeal "on" a question of law is more confined than an appeal that "involves" a question of law: TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation (1988) 82 ALR 175 at 178; Comcare v Etheridge and Others (2006) 149 FCR 522 at [13]. In Etheridge, Branson J said (at [14]): 14 The legislature, by creating a statutory right of appeal to a party to a proceeding before the Tribunal in the narrow terms of s 44(1), disclosed an intention to limit the capacity of the Court on an appeal under s 44(1) to review factual findings of the Tribunal. An appeal pursuant to s 44(1) is thus quite different from an appeal from a judicial body under s 24 of the Federal Court Act. An appeal under s 24 is an appeal by way of rehearing (see, Poulet Frais Pty Ltd v Silver Fox Company Pty Ltd (2005) 220 ALR 211 at [35]-[47]). The subject matter of an appeal under s 44(1) of the AAT Act is (shorn of the requirement to determine what, if any, entitlement to relief flows from the answer to the question or questions of law) of the same character as the subject matter of a reference of a question of law to the Court made under s 45 of the AAT Act. 44 The subject matter of an appeal under s 44(1) of the AAT Act is the precise question or questions of law stated in the notice of appeal as required by r 33.12(2) of the Federal Court Rules 2011 (Cth): see Birdseye v Australian Securities and Investments Commission (2003) 76 ALD 321; Etheridge at [13]; HBF Health Funds Inc v Minister for Health and Ageing (2006) 149 FCR 291 at [5]. 45 At the commencement of the hearing, the applicants were granted leave to file and rely on an amended notice of appeal. Relevantly, the amended notice of appeal sets out the following asserted questions of law: 1 Whether, having regard to the provisions of s 223(11) of the Act and reg 22.11(4)(b) of the Patents Regulations 1991 (Cth), s 223(2)(a) of the Act confers the power to extend time for filing, during the term of a patent as required by s 71(2) of the Act, an application under s 70(1) of the Act for an extension of term of the patent. … 3 Whether the failure by a person to consider filing an application for an extension of term of a patent or to contemplate that such an application could be filed within the time required by s 71(2) of the Act is capable of constituting: (a) an error or omission for the purposes of s 223(2)(a) of the Act; or (b) an error or omission that caused the failure to file such an application within that time for the purposes of s 223(2)(a) of the Act. 4 Whether a belief as to the state of the law regarding the basis on which an application for an extension of term of a patent can be filed pursuant s 70(1) of the Act is capable of constituting an error or omission that caused the failure by the person concerned to file such an application for the purposes of s 223(2)(a) of the Act, in circumstances where that belief is maintained in the face of advice and administrative and judicial determinations to the contrary. 4A Whether, on the facts as found by the Tribunal, there was: (a) an error or omission for the purposes of s 223(2)(a) of the Act; or (b) an error or omission that caused the failure to file such an application within the time required by s 71(2) of the Act for the purposes of s 223(2)(a) of the Act. 5 Whether, in exercising the discretion to extend time for doing a relevant act under s 223(2)(a) of the Act, and in particular any discretion to extend time for filing an application for an extension of term of a patent pursuant s 70(1) of the Act, it is relevant to take into account: (a) the maintenance by the person concerned of an incorrect belief as to the state of the law in the face of advice and administrative and judicial determinations to the contrary; (b) the public interest in an application for extension of time being notified and made promptly and as soon as the person concerned becomes aware of the circumstances relating to the failure to do the relevant act; (c) the public interest in the Register of Patents accurately reflecting the term of a patent, including any extension of that term, and any application or proceeding which may affect the date of expiry of the patent; (d) the public interest in the prompt, frank, comprehensive and clear disclosure of all circumstances relating to the failure to do the relevant act; (e) the views of third parties, who did not advise the person concerned, as to the reasonableness of the conduct of the person concerned; and (f) the interests of third parties, which would or may be adversely affected if the extension of time is granted. 6 Whether, for the purposes of the exercise of the discretion to extend time for doing a relevant act under s 223(2)(a) of the Act, delay by the person concerned in applying for an extension of time can be excused by the fact that the person believed the state of the law concerning the need to do the relevant act was incorrect. … 8 Whether, on the facts as found by the Tribunal, … the decision of the Tribunal that an extension of time should be granted was not reasonably open or was a decision to which no reasonable decision-maker could come. 8A Whether, on the facts as found by the Tribunal, subject to the challenges to the Tribunal's findings reflected in ground 10, the decision of the Tribunal that an extension of time should be granted was not reasonably open or was a decision to which no reasonable decision-maker could come. 46 Relevantly, the amended notice of appeal sets out the following grounds of appeal: 1 The Tribunal erred in finding (at [43]-[47]) that s 223(2)(a) of the Act conferred the power to extend time for Lundbeck to file, during the term of the Patent as required by s 71(2) of the Act, an application under s 70(1) of the Act for an extension of term of the Patent based on the inclusion of CIPRAMIL in the ARTG. 2 The Tribunal ought to have found that, by reason of the provisions of s 223(11) of the Act and reg 22.11(4)(b), the act of Lundbeck filing, during the term of the Patent as required by s 71(2) of the Act, an application under s 70(1) of the Act for an extension of the term of the Patent, was not a relevant act in relation to which time could be extended under s 223(2)(a) of the Act. … 5 The Tribunal erred in finding (at [57]-[61]) that Lundbeck made an error or omission for the purposes of s 223(2)(a) of the Act and that error or omission caused the failure to file an application for extension of term of the Patent based on the inclusion of CIPRAMIL in the ARTG within the time required by s 71(2) of the Act. 6 The Tribunal ought to have found that the failure by Lundbeck to consider filing an application for an extension of term of the Patent based on the inclusion of CIPRAMIL in the ARTG within the time required by s 71(2) of the Act was not: (a) an error or omission for the purposes of s 223(2)(a) of the Act; or (b) an error or omission that caused the failure to file such an application within that time for the purposes of s 223(2)(a) of the Act. 7 The Tribunal ought to have found that Lundbeck's belief that an application for an extension of term of the Patent could not be based on the inclusion of CIPRAMIL in the ARTG was not an error or omission that caused the failure to file such an application for the purposes of s 223(2)(a) of the Act, in circumstances where that belief was subsequently maintained by Lundbeck in the face of the advice and decisions referred to in paragraphs 8(a) to 8(e) below. 8 In exercising the discretion pursuant to s 223(2)(a) of the Act to grant Lundbeck an extension of time from 26 July 1999 to 12 June 2009 in which to file an application for extension of term of the Patent based on the inclusion of CIPRAMIL in the ARTG, the Tribunal erred in failing to take into account, or in failing to give any significant weight to, the following relevant considerations: (a) in July 2005, Lundbeck was advised by its patent attorneys, Watermark, that one immediate action it could take was to file an application for an extension of time in which to file an application for extension of term of the Patent based on the inclusion of CIPRAMIL in the ARTG (at [69]); (b) in May 2006, a Delegate of the Commissioner of Patents, Dr S D Barker, decided that any extension of term of the Patent should be based on the inclusion of CIPRAMIL in the ARTG and that the Register should be amended to reflect a corresponding expiry date of 9 December 2012 (at [80]); (c) in June 2006, Lundbeck appealed from the decision of the Delegate to the Federal Court and sought a stay of the amendment of the Register in relation to the expiry date of the Patent (Annexure A to the Tribunal's decision); (d) in February 2007, Lundbeck entered into the Settlement Agreement with Sandoz in relation to the proceedings between them; (e) in April 2008, a judge of the Federal Court, Lindgren J, held that the extension of term of the Patent was invalid on the basis that any application for an extension of term of the Patent should have been based on the inclusion of CIPRAMIL in the ARTG (at [82]); (f) the public interest in the prompt, frank, comprehensive and clear disclosure of all circumstances relating to the failure to do the relevant act (at [92]-[98]); (g) the interests of the Applicants, which would or may be adversely affected if the extension of time is granted (at [101]-[108]); and (h) the public interest in an application for extension of time being notified and made promptly and as soon as the person concerned becomes aware of the circumstances relating to the failure to do the relevant act (at [109]-[110]). 9 In exercising the discretion pursuant to s 223(2)(a) of the Act to grant Lundbeck an extension of time from 26 July 1999 to 12 June 2009 in which to file an application for extension of term of the Patent based on the inclusion of CIPRAMIL in the ARTG, the Tribunal erred in taking into account the following irrelevant considerations: (a) Lundbeck's stated belief that the decision of Lindgren J was wrong and would be overturned on appeal (at [82]); (b) the belief referred to in sub-paragraph (a) above, in circumstances where there was no evidence of any advice given to Lundbeck in relation to the correctness or otherwise of that decision or its prospects on appeal; and (c) the views of third party patent attorneys, who did not advise Lundbeck, as to the reasonableness of that belief or Lundbeck's conduct (at [84]-[91]). 10 In exercising the discretion pursuant to s 223(2)(a) of the Act to grant Lundbeck an extension of time from 26 July 1999 to 12 June 2009 in which to file an application for extension of term of the Patent based on the inclusion of CIPRAMIL in the ARTG, the Tribunal erred in making the following findings or drawing the following conclusions which were perverse, not reasonably open and contrary to the evidence: (a) the conduct of Lundbeck was in accordance with advice from Corrs Chambers Westgarth, in circumstances where there was no evidence of any advice given to Lundbeck at least after May 2007 (at [78]); (b) the advice provided by Watermark in July 2005 did not support a conclusion that the conduct of Lundbeck was in any way unreasonable (at [79]); (c) following the decision of the Delegate in May 2006, there was no need for Lundbeck to apply for an extension of term or of time because the term as recorded on the Register had already been fixed by the Delegate, in circumstances where Lundbeck appealed against that decision (at [80]); (d) it was not necessary or appropriate for Lundbeck to inform the Delegate of the Commissioner of Patents on the hearing of the application for extension of time of the advice provided by Watermark in July 2005 (at [94]); (e) no practical or useful purpose would have been served by Lundbeck filing an application for extension of time on a contingent basis (at [95]); (f) until the application for extension of time was filed on 12 June 2009, nothing of significance occurred which could or should have caused Lundbeck to change its view that it was not necessary or appropriate to make such an application before that time (at [96]); (g) it was reasonable for Lundbeck to wait until the last day before expiry of the Patent, 12 June 2009, and after the making of orders determining its appeal to the Full Court (including a stay of the removal of the extension of term), before filing an application for extension of time, notwithstanding the matters referred to in paragraphs 8(a) to 8(h) above and the fact that it had formed an intention to do so at least from February 2009 (at [97], [103]); (h) the asserted disadvantages and hardships or prejudice claimed by the Applicants individually or cumulatively could not be given any significant weight (at [108]); and (i) that the conduct of Lundbeck was not detrimental to the public interest so as to disentitle it from an extension of time (at [110]). … 12 On the facts as found by the Tribunal, … the Tribunal ought to have found that the extension of time sought by Lundbeck should be refused. 47 It is apparent from these grounds, particularly grounds 8, 9, 10 and 12, that the applicants have sought to agitate in this appeal a number of the factual contentions they had unsuccessfully advanced in their appeal to the Tribunal. As discussed below, in the context of an appeal under s 44(1) of the AAT Act, not all these contentions, properly considered, are confined to questions of law.

The power to extend time: grounds 1 and 2 48 The applicants contended that s 223(2) of the Act does not confer power on the Commissioner to extend the time within which a patentee may apply to the Commissioner under s 70(1) of the Act for an extension of the term of a patent. They argued that this conclusion arises from the combined operation of s 223(11) of the Act and reg 22.11(4)(b) of the Regulations. The steps in the applicants' argument are as follows: The power under s 223(2) to extend time only exists with respect to a "relevant act". The expression "relevant act" is defined in terms that exclude a "prescribed action". Regulation 22.11(4)(b) prescribes the following action: "filing, during the term of a standard patent as required by subsection 71 (2) of the Act, an application under subsection 70 (1) of the Act for an extension of the term of the patent;". These words refer to the timing of the act that ought to have been done by the patentee, namely, filing an application for an extension of term in accordance with s 71(2). The words thus constitute a composite phrase that identifies the act that was required to be done and in respect of which an extension of time is sought. The words do not draw a distinction between types of breach of the time limits of s 71(2). The power delegated by s 223(11) is to prescribe particular acts, not set particular time limits for the doing of acts. Once an act is prescribed, it is outside the definition of "relevant act" and thus not within the ambit of s 223(2)(a). Section 223(11) does not confer power to make the availability of s 223(2)(a) conditional upon when the patentee files its belated extension of term application. A construction of the regulation that avoids extending it beyond its permitted scope is to be preferred. 49 The applicants' reasoning should not be accepted. It effectively ignores the words "during the term of a standard patent" in reg 22.11(4)(b) and thereby modifies the scope of the prescription. 50 The making of an application under s 70(1) of the Act is governed by two time limits: the application must be made "during the term of the patent" and within six months of the applicable date in s 71(2)(a) to (c). Both time limits must be observed in order to make an application. 51 There is nothing in s 223(2) of the Act that would deny the Commissioner the power to extend either or both time limits, other than the meaning to be given to "relevant act" in s 223(11). Relevantly for present purposes, s 223(11) provides that a "relevant act" is an "action" in relation to a patent, other than a "prescribed action". Regulation 22.11(4)(b) does not simply prescribe the filing of an application under s 70(1) of the Act. The words "during the term of a standard patent under subsection 71 (2) of the Act" specifically identify the action that is prescribed. The words "under subsection 71 (2)" in the phrase do not, by mere reference to the subsection, incorporate the second action of filing the application within six months of the applicable date under s 71(2)(a) to (c). Properly understood, reg 22.11(4)(b) distinguishes between separate actions and prescribes one, not the other. The result is that the action of filing the application under s 70(1) during the term of the patent is prescribed and cannot, therefore, be a relevant act to which s 223(2) refers. On the other hand, the action of filing the application within six months of the applicable date is not prescribed and is taken to be a relevant act to which s 223(2) can respond. 52 Contrary to the applicants' submissions, there is nothing in the wording of s 223(11) that would preclude an action being prescribed by reference to a particular time limit. To so prescribe an action is merely to identify it, not to set, independently, a particular time limit for the doing of acts. 53 The Tribunal accepted Lundbeck's contention that the second time requirement that an application be filed within six months of the applicable date in s 71(2)(a) to (c) was a relevant act in respect of which time can be extended under s 223(2). It was correct to so conclude. 54 The Tribunal noted that this interpretation of s 223(2) had been adopted in the Australian Patent Office Manual of Practice and Procedure (the Patent Office Manual). It also reasoned that an interpretation that resulted in s 223(2) not being available in relation to an extension of term would be contrary to the remedial intent of the provision and would produce an anomalous result. The Tribunal saw that conclusion as being supported by the Explanatory Memorandum to the Intellectual Property Laws Amendment Bill 1997 which resulted in the insertion of the current extension of term provisions into the Act. 55 Relevantly, the Explanatory Memorandum said: Section 71 sets out the requirements of the form and timing of the application. The extension of time provision under section 223 of the Patents Act 1990 will apply to all acts required to be done under the extension of patent term scheme provided that the relevant criteria are satisfied. 56 The applicants submitted that the proper construction of s 223(2) informed by reg 22.11(4)(b) cannot be assisted by statements in the Patent Office Manual. That is undoubtedly correct. But it is clear that the Tribunal's reference to the Patent Office Manual in its reasons was no more than an aside. Moreover, the construction of s 223(2) informed by reg 22.11(4)(b) was correct, regardless of how the Tribunal may have informed itself in that regard. 57 The determination of the proper construction of s 223(2) informed by reg 22.11(4)(b) does not require recourse to extrinsic materials. The applicants criticised the Tribunal's reference to the Explanatory Memorandum as the Explanatory Memorandum predated the introduction of reg 22.11(4)(b) as well as its predecessor, reg 22.11(3)(c). The applicants submitted that the relevant statutory intention was expressed in an Explanatory Statement accompanying the Patents Amendment Regulations 1998 (No 8) 1998 (Cth). Relevantly, the Explanatory Statement said: Item 7 of Schedule 1 to the Statutory Rules substitutes a new paragraph 22.11(3)(c) of the Regulations. This paragraph prescribes the action of filing an application for extension of term under section 70 of the Act during the term of the patent as being an action for which an extension of time under section 223 of the Act is not available. 58 This statement does not advance the construction of reg 22.11(4)(b) for which the applicants contend. It merely recites the substance of the words now employed in the provision without assisting in the ascertainment of the meaning of the provision. 59 For these reasons, the Tribunal was correct to conclude that power existed under s 223(2) to extend the six-month time limit in relation to the applicable date under s 71(2)(a) to (c).

error or omission: grounds 5, 6 and 7 60 The power to extend time under s 223(2)(a) of the Act is based on the requirement that there be an error or omission that causes a person to fail to do a relevant act within a certain time. The failure to do the relevant act within time is distinct from the error or omission that causes that failure: Kimberly Clark Ltd v Commissioner of Patents and Another (No 3) (1988) 13 IPR 569 at 580. Here, the relevant act that should have been done was the filing of an application to extend the term of the patent within six months after the latest date in s 71(2)(a) to (c). Given that Cipramil was included in the ARTG on 9 December 1997, the latest date was in fact that governed by s 71(2)(c), namely, the date of commencement of s 71, which was 27 January 1999. Therefore, the statutory deadline for filing the application for an extension of the term of the patent was 26 July 1999. 61 The applicants contended that the Tribunal erred in finding that there was, for the purposes of s 223(2)(a) of the Act, an error or omission on the part of Lundbeck that caused its failure to file, within the required time, an application to extend the term of the patent. In order to consider this contention, it is necessary to refer to certain findings of fact made by the Tribunal and the evidence which supported those findings. 62 Before the Tribunal, Lundbeck contended that the error was its mistaken belief that an application to extend the term of the patent could only be based on the inclusion of Lexapro in the ARTG. Lundbeck's case was that, at all times, it acted consistently with that understanding and that, as a direct result, it failed to comply with the time limit under s 71(2)(b) of the Act. 63 Evidence on this matter was given by John Meidahl Petersen, Lundbeck's Divisional Director of Corporate Patents and Trade Marks. In a statutory declaration made in the proceeding before the Commissioner, which was also in evidence before the Tribunal, Mr Petersen said that, in July 1999, he was aware that the patentee of an Australian pharmaceutical patent could apply to extend the term of the patent. His understanding was that, in order to do so, the patentee must have obtained marketing approval for the product(s) falling within the claims of the patent. Speaking as at that time, he said: 10 … I did not believe that Lundbeck had any Australian patents in force relating to escitalopram that could be extended because Australian marketing approval had not been obtained for any product containing or consisting of escitalopram. This view was shared by Lundbeck. 11 As a chemist and patent attorney, it is and has always been my view that Cipramil does not fall within the scope of the claims of the Lexapro Patent. This view is shared by Lundbeck. 12 On the basis that Cipramil does not fall within the scope of the claims of the Lexapro Patent and my view … that an extension of term of a patent is granted to allow the patentee the full term to sell … the product protected by the patent, prior to 2005, I and Lundbeck did not contemplate applying to extend the term of the Lexapro Patent on the basis of the marketing approval of Cipramil. … 64 The Tribunal quoted this passage in its reasons. It accepted Mr Petersen's evidence and found that it established a relevant error or omission by Lundbeck in 1999 that caused its omission to file an application for an extension of the term of the patent: see at [57], [58] and [60] of the Tribunal's reasons. (In its reasons at [59], the Tribunal referred to an omission to file an application for an extension of time. The context makes clear, however, that the Tribunal was intending to refer to an extension of term.) 65 Although not specifically mentioned by the Tribunal, Mr Petersen's evidence was supported by a document apparently prepared by him on 29 December 1998. The document deals with Lundbeck's escitalopram patents. It includes an appendix which shows the expiration dates, status and scope of protection of the various patents in that family. It also shows possible extensions of the various patents, based on marketing approval dates expected as at 1 January 2002. The appendix shows a patent granted for Australia that, with an extended term, would expire on 13 June 2014. It can be inferred from this document that, as at 29 December 1998, Mr Petersen had in mind that an extension of the term of the patent would be one based on the entry of Lexapro, not Cipramil, in the ARTG. 66 The present grounds of appeal are based on drawing a distinction between Lundbeck's erroneous belief that an extension of the term of the patent could only be based on the inclusion of Lexapro in the ARTG, and Mr Petersen's evidence that, prior to 2005, Lundbeck did not contemplate an extension of the term of the patent based on the inclusion of Cipramil in the ARTG. 67 Relying on this distinction, the applicants submitted that, as Lexapro was not included in the ARTG until 2003, it could not be the case that Lundbeck's "view about LEXAPRO" was a causative error before 26 July 1999. The applicants went so far as to submit that there is no evidence that Lundbeck formed its erroneous belief that an extension of the term of the patent could only be based on the inclusion of Lexapro in the ARTG before that date. They submitted that the erroneous belief advanced by Lundbeck as an error "did not occur". 68 Secondly, the applicants submitted that Mr Petersen's evidence that Lundbeck did not contemplate applying to extend the term of the patent based on the inclusion of Cipramil in the ARTG prior to 2005, shows that the question of the extension of the term of the patent based on Cipramil "simply did not arise before 26 July 1999". 69 Thirdly, the applicants submitted that Lundbeck's persistence in seeking to advocate the position that an application for an extension of the term of the patent could only be based on the inclusion of Lexapro in the ARTG, and its failure to apply for an extension of term based on the inclusion of Cipramil, even after its error had been shown, objectively demonstrates that "the required causative 'error or omission' was absent". 70 These arguments cannot be accepted. The distinction on which they are based is specious. Lundbeck's belief that an extension of the term of the patent could only be based on the inclusion of Lexapro in the ARTG necessarily carried with it an erroneous belief that an application could not be based on the inclusion of Cipramil in the ARTG. As Lundbeck submitted, it is not correct to limit the notion of an error or omission for the purposes of s 223(2) of the Act to an express consideration and rejection of the correct position. 71 In Kimberly Clark, Jenkinson J considered the scope to be given to the word "error" in the context of s 160(2) of the Patents Act 1952 (Cth), which was in closely similar terms to s 223(2) of the Act. His Honour observed (at 579-580) in that context, that: … the word "error" is not easily assigned a clear meaning restricted by reference to one or several particular categories of flawed mental function. The attempt is likely to lead to the drawing of fine and often unrealistic distinctions. … 72 The distinction that the applicants seek to draw is an unrealistic one. 73 There is no proper basis to interfere with the Tribunal's acceptance of Mr Petersen's evidence or its finding that the evidence established a relevant error or omission by Lundbeck in 1999. Moreover, the Tribunal was not in error in concluding that Lundbeck's erroneous belief was an error for the purposes of s 223(2) of the Act. Further, there is no proper basis to interfere with the Tribunal's finding that this error caused Lundbeck's failure to apply for an extension of the term of the patent within time.

The exercise of discretion: grounds 8, 9, 10 and 12

Introduction 74 When dealing with the applicants' claim that Lundbeck's conduct disentitled it to the extension of time it had sought, the Tribunal recorded (at [63] of its reasons) the following factors that had been advanced by the applicants: • Length of the delay between 26 July 1999 and 12 June 2009; • Failure to satisfactorily explain the delay; • Making a deliberate choice to maintain its statutory monopoly as long as possible for commercial reasons; • Failure to foreshadow the possibility that it might seek the present extension over four years of litigation until at the earliest February 2009; • Misleading the delegate of the Commissioner by not disclosing advice received or not disclosing frankly all the conduct, knowledge, beliefs and mental processes of Lundbeck in relation to the extension of time; • Adopting and maintaining the clearly erroneous view of the position taken by it before and even after the decisions of the Federal Court; • Rejection of advice by its patent attorneys; • Failure to make a contingent application for an extension of time; • The public interest in publicising its proposal to make an application for extension of time; • Taking a calculated commercial risk in not making a contingent application. 75 The Tribunal then proceeded to discuss the evidence of Lundbeck's conduct from 26 July 1999 and to make certain findings of fact, for the purpose of weighing these factors. Before dealing with the substance of grounds 8, 9, 10 and 12 of the appeal, it is necessary to detail that evidence and to note the Tribunal's findings and conclusions.

The Tribunal's findings and conclusions 76 The Tribunal conducted its fact-finding by reference to three periods of time: 26 July 1999 to July 2005; July-August 2005 to April 2008; and April 2008. 77 The commencement of the first period of time (26 July 1999) was, as noted above (see [60]), the statutory deadline for filing the application to extend the term of the patent. The Tribunal (at [66]) found, with respect to this period, that: • Lundbeck and its agents had no reason to conclude that its approach of seeking an extension of term on the basis of the first inclusion of Lexapro in the ARTG was in error; and • Lundbeck's incorrect interpretation of the relevant statutory requirements was the cause of its failure to apply to extend time to enable it to apply to extend the term of the patent on the basis of the first inclusion of Cipramil in the ARTG. 78 The commencement of the second period relates to the date (13 July 2005) when Lundbeck received notice that the Commissioner (a) had determined that Lundbeck's extension of term application should have been based on the date that Cipramil was first included in the ARTG, and (b) proposed to correct the Register by adjusting the term of the extension to 9 December 2012. The end of the second period relates to the period up to 24 April 2008, before Lindgren J found that Lundbeck's extension of term application had been made out of time and was invalid. 79 In that period, Lundbeck's patent attorneys, Watermark, wrote to Lundbeck informing it of the Commissioner's proposed action. This letter, which was dated 14 July 2005, was of central importance to the applicants' appeal to the Tribunal (the Watermark letter). Recognising this, the Tribunal set out the letter in its reasons, adding emphasis to certain statements in it: 14 July 2005 … Dear Ms Aalborg Re: Alphapharm Pty Ltd v H. Lundbeck A/s Federal Court of Australia NSD 1120/2005 (New South Wales District Registry) and Application under s.138 & 192 for revocation of Patent No 623144 or alternatively, rectification of the Register of Patents to remove the extension of term of the patent. We refer to the above matter and acknowledge receipt of your email of 9 July 2005. CORRECTION OF EXPIRY DATE OF PATENT We yesterday received correspondence from the Deputy Commissioner of Patents in this matter. This correspondence is pursuant to a letter to the Commissioner dated 7 July 2005 from Alphapharm Pty Ltd. Alphapharm Pty Ltd have advised the Commissioner that they will be seeking further orders from the Federal Court of Australia in respect of the extension of term of this patent unless the Commissioner takes appropriate action herself by correcting the term of the patent in the Register. A copy of Alphapharm's letter to the Commissioner and a copy of their draft application to the Federal Court is attached. You will see from the letter to us from the Deputy Commissioner that Reg. 10.7(7) of the Patents Act 1990 essentially states that the Register must be corrected where the Commissioner finds that the extended expiry date is incorrect. A copy of the relevant regulations is enclosed herewith. Note that the procedure associated with the correction is also set out in the regulations. You will also see that the Commissioner intends to rectify the Register to show that the expiry day of patent is correctly 9 December 2012, not 13 June 2014. A copy of the Federal Court decision in Merck v Arrow Pharmaceuticals Ltd is also enclosed for your review. Prima facie, the Commissioner's application of this decision to the facts at hand would appear to be correct. REQUIRED CTION BY H. LUNDBECK H Lundbeck A/S is required to advise the Commissioner by 12 August 2005 of any reason why the Commissioner should not proceed to make the correction to the Register, or alternatively, that you accede to the amendment being made. If you do not respond by 12 August 2005, an ex parte hearing will be conducted at which time it would seem certain that the correction to the Register will be made. It appears to us at first glance that there are only two avenues upon which you could reject an amendment to the Register: 1. that CIPRAMIL is not a racemate and does not contain the isomer which is subject of Australian Patent 623144; or that 2. the decision in Merck v Arrow is wrong (with supporting argument). Either of these avenues is likely to be very difficult to pursue. RAMIFICATION OF CORRECTION You will also be aware that there are serious ramifications of acknowledging that CIPRAMIL contained the LEXAPRO isomer and that thus the LEXAPRO isomer was first entered on the ARTG in December 1997. Under section 71(2) of the Patents Act 1990, an application for extension of term must be filed within 6 months of the latter of: a) The date the patent was granted; or b) The date of entry of the pharmaceutical including the patented substance on the ARTG. In this case, the application for extension of term was made (at the earliest) on 9 December 2003, over 10 years after the patent was sealed (31 August 1992), and over 5 years after the entry of CIPRAMIL on the ARTG. Thus, the application for the extension of term of the isomer that is LEXARPO was arguably filed out of time and should properly have been rejected on one view. This is the subject matter of claims 3 and 4 of the application NSD 1120/2005 to the Federal Court forwarded to you last week. EXENSION OF TIME TO LODGE EXTENSION OF TERM Reg. 22.11(4)(b) of the Patents Act 1990 appears to preclude seeking an extension of time to lodge an extension of term application. However, we have had advice previously from IP Australia (see letter dated 6 February 2001 attached) that an extension of term application can be subject of an application for an extension of time. Thus, one immediate action we could take in defence of H Lundbeck's position in this matter would be to file an belated application for an extension of time to lodge the extension of term application. The immediate cost of doing so would be approximately A$7,000 and we would need to substantiate an error or omission which led to the late filing of the extension of term application within two months. Under the circumstances, we believe an error or omission could arguably be established, and taking this action would certainly complicate Alphapharm's current intentions somewhat. Please advise if you wish us to elaborate further on this possibility. CONCLUSION In any event, clearly the matter of the Directions Hearing on 29 August 2005 is looming. The decision you make in relation to this advice from the Commissioner will impact on the hearing. Please advise as soon as possible your intentions in relation to the Commissioner's proposed action under Reg. 10.7(7). This advice is only preliminary and accordingly, if you require any further assistance, please do not hesitate to revert to us. Yours faithfully WATERMARK Karen Sinclair [As quoted in the Tribunal's reasons] 80 One matter emphasised before the Tribunal and in the present appeal is the suggestion made by the author of the letter, Ms Sinclair, that "one immediate action" that could have been taken by Lundbeck was to file an application to extend time to lodge an extension of term application (referred to as a contingent application), based on the first inclusion of Cipramil in the ARTG. Before the Tribunal, the applicants argued that Lundbeck's failure, in light of this advice, to then make an extension of time application was a significant matter in deciding whether the present extension of time application should be granted. 81 It is clear from the Tribunal's reasons that it was seized of the significance of that argument. It concluded, however, that Lundbeck did not act unreasonably in not making an extension of time application "at that point". In reaching that conclusion, the Tribunal also had regard to the terms of a "follow-up" letter written by Ms Sinclair to Lundbeck on 21 July 2005 (the follow-up letter); a letter of advice dated 3 August 2005 from Corrs Chambers Westgarth (Corrs), Lundbeck's Australian solicitors (the Corrs letter); and evidence given by Mr Petersen. 82 In the follow-up letter, Ms Sinclair commented on options available to Lundbeck in light of the Commissioner's stated proposal to amend the Register. The Tribunal recorded that Ms Sinclair suggested that "there could be strategic value in filing a belated application for an extension of time". It also recorded, however, that Ms Sinclair "noted that there was a wide range of issues to consider and observed that Corrs had been appointed to provide legal advice on these matters". 83 The Corrs letter advised Lundbeck that its response to the Commissioner's proposed action should be to: • challenge the validity of reg 10.7(7) under which the Commissioner proposed to correct the Register; • make submissions to the effect that the date of the first inclusion in the ARTG of goods that contain, or consist of, escitalopram was in fact the date of inclusion of Lexapro; or • make submissions that the decision in Merck & Co Inc v Arrow Pharmaceuticals Ltd (2003) 59 IPR 226, relied on by the Commissioner as the basis for the proposed action, was wrong or could be distinguished. 84 It is to be noted that the Corrs letter did not suggest, as an appropriate response, that Lundbeck should make a contingent extension of term application, and hence an extension of time application to enable the contingent application to be made. 85 The Tribunal noted Mr Petersen's evidence that, whilst acknowledging Ms Sinclair's suggestion about the possibility of then applying for an extension of time, he did not regard the Watermark letter as "formal or final advice that Lundbeck should adopt this course", but only as providing "a preliminary comment", which Mr Petersen in fact forwarded to Corrs "immediately for consideration as to Lundbeck's legal position". The Tribunal noted that Mr Petersen did not consider that the Watermark letter or the follow-up letter "provided Lundbeck with a properly or finally considered or developed basis for action". 86 The Tribunal also noted that Mr Petersen was cross-examined at length in an attempt to suggest, in light of the above correspondence, that he deliberately chose to reject the "advice" from Watermark "in not making a contingent application for an extension of time at that point after serious doubt had been thrown on the validity of the extension". 87 As noted, the Tribunal was not persuaded that Lundbeck had acted unreasonably in not then applying for an extension of time. In that connection, the Tribunal made the following important findings: 78. We accept the evidence of Mr Petersen as to Lundbeck's belief and approach to the July-August 2005 advice and events. We accept that he preferred to rely on his consultations with, and advice from, Corrs and also that he continued at all times to hold the firm belief that Lundbeck should await the final outcome of the Federal Court proceedings, which involved related questions as to the validity of the patent and the extension of term, before taking any further action. He considered that the determination of the patent claim in that Court would be determinative as to both the validity of the Lexapro patent and its extension. We accept that he continued to believe that Lundbeck was entitled to an extension of [term] based on the Lexapro registration, and the conduct of Lundbeck up to and subsequent to that time was consistent with such a firm belief and in accordance with the advice from Corrs. 79. In our view, the Watermark letters setting out preliminary views, comments and possible strategic suggestions do not support a conclusion that the conduct of Lundbeck was in any way unreasonable in not making an application for an extension of time at that point. 88 The Tribunal also recorded that, on 19 May 2006, a delegate of the Commissioner, Dr Barker, in fact decided that the Register should be amended to reflect an extension of term based on the first inclusion of Cipramil in the ARTG: see [31] above. However, the Tribunal concluded: 80. … At this point, there was no need for Lundbeck to apply for an extension of term or of time because the term as recorded on the Register had already been fixed by the delegate. Lundbeck acted consistently and reasonably and sought to maintain the 2014 date on the Register. The determination of the expiry date and the extension depended on the final outcome of the Court proceedings. 89 The Tribunal noted that, following the conclusion of the hearing before Lindgren J in May 2007, Corrs advised Lundbeck that it was "in a good position" with respect to its contention that its extension of term application was properly based on the first inclusion of Lexapro in the ARTG. 90 The third period considered by the Tribunal was April 2008, when Lindgren J held that Lundbeck's application for an extension of term was out of time. The Tribunal found as follows: 82. … Lundbeck considered that the decision of Lindgren J was wrong and would be overturned on appeal, and reasonably continued to believe that it would win on the extension of term issue in addition to having been successful on the novelty issue. 91 The orders made by Lindgren J correcting the Register were stayed pending the determination of Lundbeck's appeal. The orders and terms of the stay were noted on the Register. As noted in [36] above, this recordal was not removed until 9 February 2010, following the refusal of Lundbeck's application for special leave to appeal. 92 When considering the reasonableness of Lundbeck's conduct in awaiting the outcome of its appeal from the judgment of Lindgren J to the Full Court before making the extension of time application, the Tribunal recorded evidence from two patent attorneys: Mr Caine and Ms Irani. This evidence was adduced by Lundbeck. No evidence was adduced by the applicants to refute or contradict this evidence. 93 Mr Caine's evidence, which was accepted by the Tribunal, was to the effect that: • his own view and the view of other members of the patent attorney profession was that Lindgren J's judgment was incorrect in relation to the true construction of s 71(2)(b) of the Act; and • the Commissioner would have deferred dealing with any contingent extension of time application until the final conclusion of the Court proceedings. 94 Ms Irani's evidence, which was also accepted by the Tribunal, was to the effect that: • Lindgren J's decision did not accord with views widely held among patent attorneys regarding the proper construction of s 71(2)(b) of the Act; • if she had been asked in 1999 whether Lundbeck could have an extension of the patent based on marketing approval for Cipramil, she would have said that it could not be so based; • the Commissioner would be unwilling to consider or determine a contingent extension of time application when parallel court proceedings were on foot; • no useful purpose would have been served by filing such an application; • she would have advised against such an application; and • the Commissioner would have stayed an application for an extension of time while the appeal to the Full Court was on foot. 95 The Tribunal concluded: 91. In our view, the evidence of Mr Caine and Ms Irani provide support for the reasonableness of the position taken by Lundbeck in maintaining its view as to the correct interpretation of the Act and in deferring the application for the extension of time until at least the decision of the Full Federal Court was handed down in 2009. 96 The Tribunal then dealt with the question of whether Lundbeck had misled the Commissioner's delegate by not disclosing the substance of the comments and suggestions received from Watermark and the advice from Corrs in 2005. The Tribunal found (at [94]) that, in making the extension of time application before the Commissioner, it was neither "necessary" nor "appropriate" for Lundbeck to inform the delegate of the "preliminary" observations and suggestions made in the Watermark letter. The Tribunal gave the following reasons for this conclusion: 95. This is because the "advice" was expressed to be preliminary in the nature of a possible course of pre-emptive or protective action in respect of litigation which had just been commenced. Secondly, no practical or useful purpose would have been served by filing an application on a contingent basis as it would clearly not have been dealt with until the court proceedings had been finally resolved. Notwithstanding the suggestion of a possible application at that stage by Watermark, we find that Lundbeck genuinely and reasonably continued after taking appropriate legal advice to hold its view that the Lexapro registration date was the only relevant date, having regard to the widely accepted view among patent attorneys, including the view that the Merck decision was wrong or distinguishable. 97 The Tribunal also found (at [96]) that, until the extension of time application was filed on 12 June 2009, nothing of significance occurred which could or should have caused Lundbeck to change its view that it was not necessary or appropriate to make such an application before that time. 98 In response to the applicants' submission that Lundbeck had acted for purely strategic commercial reasons by delaying to make the extension of time application until the Full Court's decision in June 2009, the Tribunal concluded: 98. We consider it likely that commercial considerations were taken into account but, in our view, this does not alter the fact that Lundbeck reasonably maintained the view over this period that it did not have to submit an application and acted consistently with this view and considered advice from Corrs as to its options. 99 The Tribunal then turned to consider the question of hardship to the applicants. Although it accepted a submission by the applicants that it was Lundbeck's conduct that was in issue and the applicants' conduct was irrelevant, the Tribunal nevertheless decided to outline their views on that question. After making findings with respect to the position of each of the applicants, the Tribunal expressed the following conclusions: 107. All of the Applicants are experienced astute participants in a highly competitive and specialised field who, in our view, must have been fully aware of the provisions enabling an extension of time application to be made, and the fact that the Register had not been amended pending the outcome of the litigation, which was recorded on the Register. 108. In our view, the Applicants deliberately elected, for proper commercial decisions, to proceed with the launch of their generic products and take the commercial risks involved if an extension of term was ultimately granted. In two instances, the risk of the granting of an extension of time to seek an extension of the term of the patent was seen as minimal, while commercial gains to be obtained by an early launch and as the first mover were of a high order. The asserted disadvantages and hardships or prejudice claimed by the Applicants individually or cumulatively cannot be given any significant weight, and do not disentitle Lundbeck to an extension of time in which to seek an extension of term of the Lexapro patent, where the merits or otherwise of an extension of term can be fully ventilated and determined. 100 Finally, the Tribunal dealt with the question of the public interest. In this connection, the applicants had submitted that, had Lundbeck made a contingent application, then, by reason of the advertising requirements for an extension of time application, the public at large would have been put on notice at a much earlier time of Lundbeck's intention to seek an extension of time. The Tribunal, however, concluded: 110. In considering this application, it is necessary to bear in mind that the Act expressly provides for an extension of time and this must have been known to all parties and to the world at large. The Register at all relevant times until 9 February 2010 showed the expiry date as 13 June 2014 based on the ARTG registration of Lexapro, and contained the orders made by Lindgren J and the Full Federal Court. A search of the Register would have indicated the fact that there was litigation on foot and that the extension of term was disputed. As a consequence of these considerations, there is no force in the submission that the conduct of Lundbeck was detrimental to the public interest so as to disentitle it from having an opportunity to make an application and put its case for an extension of term.

The applicants' submissions 101 The applicants pointed to the fact that the Tribunal's decision was to affirm an extension of approximately 10 years to enable Lundbeck to apply to extend the term of the patent. They submitted that four years of this time represented deliberate delay as a result of a deliberate choice. In this connection, they submitted that there is no doubt that Lundbeck could have chosen, as Ms Sinclair suggested in the Watermark letter, to file an application to extend the term of the patent based on the first inclusion of Cipramil in the ARTG, and an application for an extension of time within which to do so, while maintaining the right to continue to defend the validity of its extension of term application based on the first inclusion of Lexapro in the ARTG. They submitted that, by so doing, Lundbeck would have: • preserved both its position in the litigation and its ability to argue for an extension of time with effect from that date; and • given notice to the applicants and the public that Lundbeck reserved the right to apply for a shorter extension of time to 9 December 2012. 102 The applicants contended that, in light of these matters, the Tribunal's exercise of discretion was manifestly unreasonable. Although they contended that the Tribunal's decision involved the errors set out in grounds 8, 9 and 10 of the amended notice of appeal, the thrust of their submissions was that the Tribunal's decision was unreasonable on its face. The applicants submitted that "the result itself bespeaks error": Minister for Immigration and Citizenship v Li and Another (2013) 297 ALR 225 at [85]. 103 In Li, the plurality said at [63]-[64]: [63] … The legislature is taken to intend that a discretionary power, statutorily conferred, will be exercised reasonably. [64] A standard of reasonableness in the exercise of a discretionary power given by statute had been required by the law long before the first statement of "Wednesbury unreasonableness" in Wednesbury Corporation. In Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002, McHugh and Gummow JJ instanced the 1891 decision of Sharp v Wakefield. In Ex parte Aala, Gaudron and Gummow JJ said that the requirement of reasonableness represents the development of legal thought which began before federation and accommodates s 75(v) to that development. [Footnotes omitted] 104 Their Honours, citing Wade HWR and Forsyth C, Administrative Law (10th ed, Oxford University Press, 2009) at 296, said (at [67]): [67] …The legal standard of reasonableness must be the standard indicated by the true construction of the statute. It is necessary to construe the statute because the question to which the standard of reasonableness is addressed is whether the statutory power has been abused. [Footnote omitted] 105 At [68], their Honours said: [68] Lord Greene MR's oft-quoted formulation of unreasonableness in Wednesbury has been criticised for "circularity and vagueness", as have subsequent attempts to clarify it. However, as has been noted, Wednesbury is not the starting point for the standard of reasonableness, nor should it be considered the end point. The legal standard of unreasonableness should not be considered as limited to what is in effect an irrational, if not bizarre, decision - which is to say one that is so unreasonable that no reasonable person could have arrived at it - nor should Lord Greene MR be taken to have limited unreasonableness in this way in his judgment in Wednesbury. This aspect of his Lordship's judgment may more sensibly be taken to recognise that an inference of unreasonableness may in some cases be objectively drawn even where a particular error in reasoning cannot be identified. This is recognised by the principles governing the review of a judicial discretion, which, it may be observed, were settled in Australia by House v R, before Wednesbury was decided. And the same principles evidently informed what was said by Dixon J about review of an administrative decision in Avon Downs Pty Ltd v Commissioner of Taxation, which was decided less than 2 years after Wednesbury, at a time when it was the practice of the High Court to follow decisions of the Court of Appeal in England which appeared to have settled the law in a particular area. [Footnotes omitted] 106 Further, at [72], their Honours said: [72] The more specific errors in decision-making, to which the courts often refer, may also be seen as encompassed by unreasonableness. This may be consistent with the observations of Lord Greene MR, that some decisions may be considered unreasonable in more than one sense and that "all these things run into one another". Further, in Minister for Aboriginal Affairs v Peko-Wallsend Ltd, Mason J considered that the preferred ground for setting aside an administrative decision which has failed to give adequate weight to a relevant factor of great importance, or has given excessive weight to an irrelevant factor of no importance, is that the decision is "manifestly unreasonable". Whether a decision-maker be regarded, by reference to the scope and purpose of the statute, as having committed a particular error in reasoning, given disproportionate weight to some factor or reasoned illogically or irrationally, the final conclusion will in each case be that the decision-maker has been unreasonable in a legal sense. [Footnotes omitted] 107 Reference should also be made to the remarks of French CJ at [27]-[28], where his Honour said: [27] In Wednesbury Corporation, Lord Greene MR observed that the word "unreasonable" in administrative law was used to encompass failure by a decision-maker to obey rules requiring proper application of the law, consideration of mandatory relevant matters and exclusion from consideration of irrelevant matters: If he does not obey those rules, he may truly be said, and often is said, to be acting "unreasonably". That kind of unreasonableness may be taken to encompass unreasonableness from which an undisclosed underlying error may be inferred. [28] Beyond unreasonableness expressive of particular error however, it is possible to say, as Lord Greene MR said, that although a decision-maker has kept within the four corners of the matters it ought to consider "they have nevertheless come to a conclusion so unreasonable that no reasonable authority could ever have come to it." In such a case the court may interfere. That limiting case can be derived from the framework of rationality imposed by the statute. As explained by Lord Greene MR, it reflects a limitation imputed to the legislature on the basis of which courts can say that parliament never intended to authorise that kind of decision. After all the requirements of administrative justice have been met in the process and reasoning leading to the point of decision in the exercise of a discretion, there is generally an area of decisional freedom. Within that area reasonable minds may reach different conclusions about the correct or preferable decision. However, the freedom thus left by the statute cannot be construed as attracting a legislative sanction to be arbitrary or capricious or to abandon common sense. [Footnotes omitted] 108 Reference should also be made to the remarks of Gageler J at [88]-[89], where his Honour said: [88] Brennan CJ cited Associated Provincial Picture Houses Ltd v Wednesbury Corporation for the proposition that "when a discretionary power is statutorily conferred on a repository, the power must be exercised reasonably, for the legislature is taken to intend that the discretion be so exercised". He explained the application of "Wednesbury unreasonableness" as a court acting on the "implied intention of the legislature that a [statutory] power be exercised reasonably" to hold invalid "a purported exercise of the power which is so unreasonable that no reasonable repository of the power could have taken the impugned decision or action". [89] That explanation accords with references in earlier High Court decisions to reasonableness as a condition of the exercise of a discretionary power. It has been approved in more recent decisions. It is an explanation that is well-understood by legislatures and courts alike and that has "stood the test of time". It explains the nature and scope of Wednesbury unreasonableness in Australia. [Footnotes omitted] 109 The applicants relied on these passages to develop their overarching contention that the Tribunal's decision was unreasonable on its face. They developed this contention in the following way. 110 First, the applicants referred to the subject matter, scope and purpose of the Act in granting time-limited monopolies. They pointed to the dual time requirements of s 71(2) (see [15] above). They also pointed to the statutory requirements for advertising applications and the mechanism of formal notification provided by the Register to enable the public to: … have an opportunity to know … precisely what the patentee's rights and intentions are and, where relevant, to take steps by way of revocation, rectification, opposition, etc, to protect their own rights. They can also make commercial decisions as to whether and when to launch competing products - as the applicants here did, after the expiry of the [p]atent. 111 The applicants submitted that, in the present case, Lundbeck's conduct was deliberately calculated to: … leave the public … in the dark as to its intentions, until as late as possible. Consistently with its overall approach, the evidence disclosed that it only gave perfunctory, ambiguous, belated and informal notice of its plans. [Footnote omitted] 112 Secondly, the applicants submitted that the Tribunal's treatment of the Watermark letter "reflects a fundamental misconception of the obligations of a person seeking an indulgence under s 223(2)(a)". In this connection, the applicants argued that: … [t]o sweep away Lundbeck's obligation to give prompt and candid notice of its intentions or possible actions at least from July 2005 is, with respect, to act so unreasonably as to commit an error of law. The scope and purpose of the Act does not permit a patentee to refrain from lodging an application for a six year extension of time (even a contingent one) for an additional four years. [Footnotes omitted] 113 The "six year extension of time" referred to in this quotation is the period of time calculated from the time the application for an extension of term based on the first inclusion of Cipramil in the ARTG was required to be made (26 July 1999) to the date of the Watermark letter (14 July 2005). 114 The applicants also argued that: Merely for Lundbeck to adhere stubbornly to its position - which, although arguable, was far from certain to be right - was not enough. If Lundbeck were to keep an extension of time as a "fallback" position, then prompt and candid action was required. The possibility of filing an application for an extension of time (duly advertised) was clearly open to it - making such an application would have been the proper course to follow. 115 The applicants submitted that the Tribunal should not have put aside Ms Sinclair's suggestion in the Watermark letter (which the applicants termed as "advice") on the basis that she was "a mere patent attorney". They submitted that, contrary to the Tribunal's statement in [78] of its reasons (quoted in [87] above) above, there was no evidence that Ms Sinclair's suggestion was ever contradicted. 116 It should be said immediately that nowhere in the Tribunal's reasons did it dismiss Ms Sinclair's suggestion on the basis that it was made by "a mere patent attorney". Similarly, nowhere in the Tribunal's reasons did it suggest that there was advice that contradicted Ms Sinclair's suggestion that a contingent application could have been made. Rather, as the quotation from the Tribunal's reasons in [87] above makes clear, the Tribunal accepted Mr Petersen's evidence that he preferred to rely on his consultations with, and advice from, Corrs and that he held the firm belief that Lundbeck should await the final outcome of the proceedings in this Court before taking any further action. It was plainly open to the Tribunal to make that finding. 117 The applicants also challenged the Tribunal's conclusion at [79] of its reasons (also quoted above in [87]) that it was not unreasonable for Lundbeck not to make an application for an extension of time at that point. The applicants submitted that the "inescapable inference" is that commercial and strategic considerations played a part in Lundbeck's conduct. 118 As noted in [98] above, the Tribunal did accept that it was likely that commercial considerations were taken into account by Lundbeck. It concluded, however, that this did not gainsay the fact that Lundbeck reasonably maintained the view that it did not have to submit a contingent application and acted consistently with that view, as well as consistently with the considered advice given by Corrs as to Lundbeck's options. The conclusion expressed by the Tribunal at [79] of its reasons was plainly open to it. 119 Thirdly, the applicants criticised the Tribunal's reliance on the uncontradicted evidence of Mr Caine and Ms Irani. The applicants submitted that the Tribunal's reliance on this evidence to support the reasonableness of Lundbeck's conduct until the Full Court determined the appeal on 12 June 2009 "gives no consideration to the scope and purpose of the Act" and "gives no weight" to the suggestion in the Watermark letter by Lundbeck's own patent attorneys. The applicants also submitted that the Tribunal's reliance on Mr Caine's and Ms Irani's evidence "gives no weight" to the Commissioner's decision on 19 May 2006 (see [31] above) or to the decision of Lindgren J given on 24 April 2008 (see [32] above). 120 It will be necessary to return to these submissions later. However, at this point, it should be noted that there is nothing in the Tribunal's reasons that would show that it gave no weight to the matters to which the applicants refer. It plainly considered each of these matters, as discussed above. Moreover, the Tribunal accepted Mr Caine's and Ms Irani's evidence as supporting the reasonableness of Lundbeck's own view that Lindgren J's decision was wrong and would be overturned on appeal. 121 Significantly, at this point in their submissions, the applicants accepted that, had a contingent application for an extension of term based on the first inclusion of Cipramil in the ARTG been made, it could have been stayed by the Commissioner, as in fact happened on 12 June 2009 when Lundbeck made the extension of time application. However, they submitted that such an application would have been advertised under s 223(4) of the Act, thus giving notice to the applicants and other potential competitors "in the way contemplated by the Act, that an extension of term to December 2012 was being contemplated (even as a 'fallback') by Lundbeck". The applicants submitted that Lundbeck's reluctance to show "apparent or perceived weakness" by filing such an application does not excuse its delay. They submitted: Once it is accepted that, in this case, a contingent application could have been made before 12 June 2009, it is equally apparent that it should have been made by Lundbeck before that time, at the earliest possible opportunity. To do so would have been consistent with the duty to act promptly to seek the extension, as discussed in the cases. As a general principle, this is irrefutable. It was recognised by Ms Irani in her evidence. [Footnote omitted] 122 This last-mentioned matter concerns oral evidence given by Ms Irani in which she accepted that it was her practice to apply as soon as possible under s 223 of the Act when it is realised that a deadline has been missed. Ms Irani gave this evidence before the Tribunal: And why do you regard - why do you do that?---Because once the deadline has - I guess, once its recognised that the relevant deadline has been missed, you try to show good faith and apply for the extension of time as quickly as possible. And is that a matter of good faith for the tribunal or do you regard there as being a public interest involved?---There would be a public interest involved. Because the state of the register or the state of how applications are proceeding is a matter of public importance?---That's right. 123 Fourthly, the applicants submitted that it is wrong to suggest that there was no need to file an extension of time application before June 2009. They submitted that there was a need to signal to the public that it was Lundbeck's intention to take that course if it was ultimately unsuccessful in the proceedings before the Court. They argued that the Tribunal's finding (at [96], referred to in [97] above) that "nothing of significance" occurred which should have caused Lundbeck to make its application earlier than it did "involves looking at the matter only from the perspective of Lundbeck". The applicants developed this argument by submitting: … [t]o sanction such conduct, as the Tribunal did, is contrary to the scope and purpose of the Act and, again, involves placing Lundbeck's interests over those of others whose interests the Act requires be taken into account. It also flies in the face of sound public policy. 124 It can be seen that this submission focuses on the effect on others - specifically, it can be taken, on the applicants - of Lundbeck not making a contingent extension of term application and associated extension of time application on or shortly after receiving the Watermark letter. 125 In this connection, the applicants submitted that the Tribunal "erred in setting aside the position of the applicants in its entirety". The applicants submitted that the Tribunal had "clear evidence to support a finding that all four applicants were parties whose interests would be greatly prejudiced by Lundbeck's delay in taking action". However, having made that submission, the applicants did not point to any evidence of specific prejudice caused by Lundbeck's delay, whether that delay be considered as at 14 July 2005 (the date of the Watermark letter) or as at 12 June 2009 (the date that Lundbeck made the extension of time application), or challenge the correctness of the Tribunal's findings concerning hardship to the applicants. It is necessary to refer to those findings. 126 At [99] of its reasons, the Tribunal found that, in submissions filed for the purposes of the appeal before the Full Court, Lundbeck had given express notice to the first applicant (Aspen Pharma) and to Alphapharm of its intention to apply for an extension of time in the event that it did not succeed before the Full Court. 127 At [21] and [100] of its reasons, the Tribunal found that Lundbeck informed the second applicant (Sandoz) that, if it was unsuccessful before the Full Court, it intended to seek an order that the extended term of the patent should be amended to record the expiry date as 9 December 2012. At [22] and [100] of its reasons, the Tribunal noted that, on 4 June 2009, Lundbeck gave similar notice to the third applicant (Apotex). 128 At [102] of its reasons, the Tribunal dealt with evidence concerning Apotex's position. This evidence was given by Roger Millichamp, Apotex's managing director. The Tribunal recorded Mr Millichamp's view that, at the time that Apotex's products were launched, he considered that the extension of time application was "meritless", and he has maintained that position. The Tribunal also recorded his assertion that Apotex had lost an opportunity to consider and calculate the relevant risks associated with the launch of those products. 129 The last-mentioned finding relates to evidence given by Mr Millichamp through a witness statement used at the hearing before the Tribunal. In that statement, Mr Millichamp said: 20 After [Lindgren J's] decision was handed down, I did not consider that Lundbeck may, in future, be able to file for an extension of time in which to file a second extension of term. If Apotex had been put on notice that Lundbeck may file such an extension application if its appeals were unsuccessful, Apotex would have had the opportunity to consider and calculate the relative risks associated with a launch in circumstances where the existence or non-existence of the [p]atent was arguably indeterminate. 130 In dealing with this evidence, the Tribunal went on to find that, having made that assertion, Mr Millichamp did not give any detail of any specific or particular prejudice. 131 Although the Tribunal did not make a specific finding as to the date when Apotex launched its products, it is clear from Mr Millichamp's witness statement that, on the morning of 16 June 2009, Apotex made its final decision to proceed with that launch. This was after the filing of Lundbeck's extension of term application and associated extension of time application on 12 June 2009, and after receipt of notice on 4 June 2009 of Lundbeck's intentions, as noted above. These intentions were conveyed in a letter from Corrs in which it was stated that, if the Full Court found that the extension of the term of the patent was not valid, Lundbeck would pursue "all further avenues available to it in respect of the extension of term". Corrs said that this would include the steps of filing an application for special leave to appeal to the High Court and, additionally, filing an extension of term application in the Patent Office. In context, this could only refer to a separate and different application to the one that had been the subject of the proceedings in this Court. Filing such an application necessarily included seeking an extension of time within which to bring it. 132 In his written statement, Mr Millichamp said, with respect to the final decision that was taken to launch its products: 45 … When making that decision I had formed the view that Lundbeck was unlikely to succeed in its appeal to the High Court, that Lundbeck would not seek to restrain Apotex from selling the Apotex Products, and that Apotex' competitors were entering the market. I considered that the commercial risk to Apotex of losing market share to competitors outweighed the risk of a successful High Court appeal. Apotex did not obtain advice about the prospects of the extension of time application succeeding prior to making the decision to launch. 133 At [103] of its reasons, the Tribunal dealt with the evidence concerning Alphapharm's position. The Tribunal found that Alphapharm launched its products on 15 June 2009. The Tribunal found that, by 23 February 2009, Lundbeck's position was "clear" to Alphapharm. The Tribunal made the following findings: 104. The hypothetical prejudice advanced by Alphapharm is that it may have received different advice in relation to the stay application made on the morning of 12 June 2009 if it had known earlier of the proposal by Lundbeck to file an application to file an extension of time on that day. The evidence of Mr Fraser did not advance the case for Alphapharm in relation to this aspect beyond a possible specified change of approach to the stay application. 134 The Tribunal then dealt with the evidence concerning Sandoz's position. The Tribunal made the following findings: 105. Mr Sharkey, who was formerly employed by and gave evidence on behalf of Sandoz, indicated that Sandoz took a calculated commercial decision based on timing and commercial pressures. Sandoz took into account the strong commercial advantage of launching early and he gave detailed consideration as to whether the launch should proceed. In relation to prejudice, his evidence was to the effect that if he had been given earlier notice he may have made a different assessment of the risk, and this may have resulted in a delay of the launch of the product. In our view, this speculative and undefined possibility [cannot] be given significant weight on this application for extension of time. 135 The Tribunal went on to deal with the evidence concerning Aspen Pharma's position. The Tribunal made the following findings: 106. In relation to Aspen, Mr Ellis, the former head of Business Development, did not consider that there was any significant risk that Lundbeck would get an extension of time and he took this view into account before the launch of the product on 15 June 2009. The evidence does not indicate that earlier notice would have resulted in a delay or withdrawal of the launch. He was also well aware of the commercial advantage of being the first company to launch a generic product (called "the first mover advantage"). 136 It was in light of this evidence that the Tribunal made its findings at [107] and [108], quoted in [99] above. It can be seen that, contrary to the applicants' submission, the Tribunal did not set aside the position of the applicants "in its entirety". The Tribunal had regard to the evidence of prejudice or hardship that the applicants had placed before it. It considered that evidence and concluded that the asserted disadvantages, hardships or prejudice claimed by the applicants individually and cumulatively could not be given significant weight. It was of course for the Tribunal to weigh the evidence before it. The applicants' submission in this appeal that the Tribunal had clear evidence to support a finding that all four applicants were parties whose interests would be greatly prejudiced by Lundbeck's delay in taking action, must be seen in light of the actual evidence and findings referred to above, and the Tribunal's conclusions thereon. 137 Fifthly, the applicants criticised the Tribunal's finding at [94] (referred to in [96] above) that it was neither necessary nor appropriate for Lundbeck to inform the Commissioner's delegate of the preliminary observations or suggestions as to possible courses of action mentioned in the Watermark letter. The applicants submitted that, by making this finding, the Tribunal "disregarded the authorities that require such an application to disclose all of the relevant circumstances, so that all relevant discretionary considerations can be weighed up". They argued, further, that the Tribunal did not have regard to the fact that the evidence Lundbeck put before the Commissioner's delegate was misleading because, by not referring to Ms Sinclair's suggestion in the Watermark letter, Lundbeck omitted key facts and circumstances. 138 The difficulty confronting the applicants in making this submission is that the Tribunal had before it all the relevant facts and circumstances. It was for the Tribunal to come to the correct or preferable decision. Its assessment, which was plainly open to it, was that, notwithstanding the preliminary views, comments and possible strategic suggestions in the Watermark letter, it was not unreasonable for Lundbeck not to make an application for an extension of time at that point. Once again, the Tribunal relied, as it was entitled to do, on Mr Petersen's evidence that he preferred to rely on his consultations with, and advice from, Corrs.

Relevant and irrelevant considerations: grounds 8 and 9 139 Ground 8 of the amended notice of appeal concerns whether the Tribunal failed to take into account, or failed to give significant weight to, certain considerations. Ground 9 concerns whether the Tribunal took into account irrelevant considerations. Neither in written submissions nor in oral argument did the applicants elaborate on these grounds, beyond the submissions summarised above.

Relevant considerations 140 In this discourse, a relevant consideration is one that an administrative decision-maker, such as the Tribunal, is bound to take into account in making a decision. Such factors are determined by the statute conferring the administrative discretion. Absent an enumeration of relevant factors in the statute itself, the factors that an administrative decision-maker is bound to take into account are determined by implication from the subject matter, scope and purpose of the relevant statute. Where the discretion is unconfined by the terms of the statute, a court will not find that an administrative decision-maker is bound to take a particular matter into account unless an implication that the decision-maker is bound to do so is to be found in the subject matter, scope and purpose of the statute. In this connection, see, generally, the remarks by Mason J in Minister for Aboriginal Affairs and Another v Peko-Wallsend Limited and Others (1986) 162 CLR 24 at 39-40. 141 With one exception, it is clear that the Tribunal did in fact take into account each of the matters enumerated in ground 8 of the amended notice of appeal. Indeed, ground 8 specifically references these matters to those parts of the Tribunal's reasons where it considered and dealt with them. The exception is a settlement agreement that Lundbeck and Sandoz apparently entered into in February 2007 in relation to the proceeding between them: see ground 8(d). It is clear from the Tribunal's reasons that it gave no explicit consideration to that matter. The transcript of the hearing before the Tribunal reveals that Lundbeck and Sandoz had agreed that the contents of this agreement were to be, and remain, confidential. When the applicants sought to cross-examine Mr Petersen on the contents of the agreement, objection was taken. The Tribunal upheld the objection to that line of questioning. 142 In the course of arguing that this line of questioning should be permitted, senior counsel for the applicants said: So we respectfully submit - we do not know, but we respectfully submit that there's a possibility that there's something in that document that might cast light on Lundbeck's state of mind or conduct. … 143 He also said: … And I can't put it too high about the value of it, but it's at least potentially relevant as casting light on the state of mind of Lundbeck at this critical time. … 144 In light of these concessions, fairly made, it cannot be said that the agreement or its contents were matters that the Tribunal was bound to take into account. 145 In any event, not every consideration that an administrative decision-maker is bound to take into account but fails to take into account will lead to the decision being set aside. As Mason J noted in Peko-Wallsend (at 40), a factor might so insignificant that the failure to take it into account could not materially affect the decision that was made. In light of the absence of any articulated submission by the applicants directed to the significance of the settlement agreement, it can readily be concluded that, even if it were relevant to take that matter into account, the Tribunal's failure to do so is of no consequence and could not have materially affected the decision that was made. 146 Ground 8 of the amended notice of appeal alleges alternatively, but without specificity, that the Tribunal failed to give any significant weight to the matters enumerated therein. That allegation should not be accepted. The attribution of weight to each matter was plainly a question for the Tribunal. The Court should proceed with caution when reviewing an administrative decision on the ground that the decision-maker did not give proper weight to relevant factors. The Court's jurisdiction is supervisory. It is not the Court's task to review administrative decisions on their merits. A fair reading of the Tribunal's reasons shows that it gave genuine consideration to each referenced matter enumerated in ground 8 of the amended notice of appeal and weighed those matters with the other considerations to which the Tribunal referred in its reasons.

Irrelevant considerations 147 Where a statute confers a discretion that is unconfined in its terms, the factors that can be taken into account by an administrative decision-maker are also unconfined, unless an implied limitation arises from a consideration of the subject matter, scope and purpose of the statute: The Shire President, Councillors and Ratepayers of the Shire of Swan Hill v Bradbury (1937) 56 CLR 746 at 757-758; The Queen v The Australian Broadcasting Tribunal and Others; Ex parte 2HD Proprietary Limited (1979) 144 CLR 45 at 49; Peko-Wallsend at 40. 148 Here, the applicants alleged that it was impermissible for the Tribunal to take into account Lundbeck's belief that the decision given by Lindgren J on 24 April 2008 was wrong, and the views of Mr Caine and Ms Irani to the same effect. That allegation cannot be sustained. Lundbeck's views including the genuineness and reasonableness of those views were clearly relevant matters for the Tribunal to take into account in exercising its discretion. Mr Caine's and Ms Irani's uncontradicted evidence spoke of views held more generally in the patent attorney profession at the relevant time and constituted supporting evidence of the reasonableness of the views that Lundbeck itself professed to have at that time.

Lack of proper basis for findings: ground 10 149 Ground 10 of the amended notice of appeal concerns the question of whether there was a factual basis for certain findings made by the Tribunal. 150 The applicants have not established that the factual findings made by the Tribunal, referenced and challenged in ground 10, were not open to be made on the evidence before it. When properly analysed, the applicants' challenge really agitates the question of what, preferably, the Tribunal should or should not have found on the evidence before it. 151 It is not the task of the Court when undertaking judicial review to supplant the Tribunal's view of the facts simply because another, even contrary, view might have been open on the evidence. 152 Further, it appears that at least one of the applicants' challenges might well proceed on a misreading of what the Tribunal actually found. In this connection, the applicants challenged the Tribunal's finding at [95] (quoted in [96] above) that no practical or useful purpose would have been served by Lundbeck filing an extension of time application on a contingent basis because such an application would not have been dealt with until the Court proceedings were finally resolved. 153 Here, the applicants appear to challenge the finding that no practical or useful purpose would have been served by filing such an application because, in their submission, there would have been utility in advertising the application and bringing it to the attention of the public and, in particular, the applicants: see [121] and [123] above. 154 However, in this part of its reasons, the Tribunal was not addressing, at large, the question of the utility of a contingent extension of term application and associated extension of time application. Rather, it was addressing whether it was necessary or appropriate for Lundbeck to inform the Commissioner's delegate of the preliminary observations and suggestions made by Ms Sinclair in the Watermark letter. As noted above, the Tribunal concluded that it was not necessary or appropriate for the Commissioner's delegate to be informed of those matters. It was in the course of explaining that conclusion that the Tribunal said that no practical or useful purpose would have been served by filing such an application. Plainly, the Tribunal was referring to Lundbeck's motives and, specifically, to the fact that, as to Lundbeck's position, no practical or useful purpose would have been served.

Reasonableness: ground 12 155 Ground 12 of the amended notice of appeal alleges that, on the facts as found, the Tribunal ought to have concluded that the extension of time application should have been refused. The applicants submitted that this ground enlivens question 8 in the amended notice of appeal, namely, whether the Tribunal's decision that an extension of time should be granted was not reasonably open or was a decision to which no reasonable decision-maker could come. The applicants identified this as the critical question relating to the exercise of the Tribunal's discretion under s 223(2)(a). They said that the essence of the complaint arising under ground 12 was that the Tribunal misapplied the facts in exercising its discretion. 156 It may be accepted that it was open to Lundbeck to make a contingent extension of term application and associated extension of time application earlier than it did, including shortly after receiving the Watermark letter. The reasons why it did not do so until 12 June 2009 were considered and assessed by the Tribunal. It may also be accepted that the extension of time sought by Lundbeck is a very lengthy one. However, the significance of that fact cannot be appraised in the abstract. The circumstances in which the extension was sought were, to say the least, unusual. Lundbeck and some of the applicants had been engaged over a number of years in complex patent litigation, one aspect of which concerned Lundbeck's entitlement to extend the term of the patent. It would not be rational for any participant in, or informed observer of, those events to think that Lundbeck would do anything other than take all reasonable steps legally open to it to protect and advance its rights in that regard. This must have been appreciated by the applicants. The Tribunal (at [107]) found them to be experienced and astute participants in a highly competitive and specialised field. The Tribunal also found that they must have been fully aware of the provisions enabling extension of time applications to be made. The applicants may well have felt a degree of frustration that Lundbeck made its extension of time application only after the fate of its appeal was known, but this does not mean that, by granting an extension of time, the Tribunal was acting unreasonably in the circumstances. 157 When full regard is had to the facts as found by the Tribunal and its expressed reasons for granting Lundbeck's extension of time application, it cannot be said that the Tribunal's decision was unreasonable in light of the subject matter, scope and purpose of the Act, such as to require that decision to be set aside.

disposition 158 In light of these reasons, the amended notice of appeal should be dismissed with costs. I certify that the preceding one hundred and fifty-six (156) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Yates.