Intelligent patent evergreening available

Pfizer has recently successfully resisted the Australian Competition Commission’s attempts to shut down its patent evergreening activities in trying to leverage its atorvastatin (Lipitor) patent past
its end of term.

In ACCC v Pfizer Australia Pty Ltd [2015] FCA 113, the Federal Court rejected the Commission’s complaint that Pfizer’s end-of-term activities amounted to a misuse of market power and exclusive
dealing, contrary to the Competition and Consumer Act.

Pfizer, realising that the end of patent term for its blockbuster drug Lipitor would mean a dramatic loss in revenues, due to the flood of generic producers entering the market, decided to launch a
new generic range itself. The marketing plan involved bundling the generic version of atorvastatin with the Lipitor version, with inducements to purchase the Pfizer generic version beyond the expiry term of the patent. The net effect was that Pfizer was able to capture a significant portion of the generic market where previously it had not been active.

The Court found that while Pfizer’s conduct “made it harder for the other manufacturers to compete, it did not engage in the conduct in question for any substantial purpose of deterring or preventing the other generic manufacturers from entering the market”.

No doubt other innovators, facing the end of their patent term, will adopt a similar template to leverage the generic market.

This article by Shelston IP Partner, Peter Treloar, first appeared in Managing Intellectual Property magazine, April 2015.