On appeal from Apotex Pty Ltd v Warner-Lambert LLC (No 3) [2017] FCA 94, which we recently reported, the Full Federal Court has confirmed in Warner-Lambert Company LLC v Apotex Pty Limited [2017] FCAFC 58 that applying for Pharmaceutical Benefits Scheme (PBS) listing does not involve an offer to supply and clarified the reasoning in support of the primary judge’s position.
The primary judge characterised the application for PBS listing as a ‘mere preparatory step’ to taking advantage of the PBS scheme after the expiry of the relevant patent. The Full Federal Court has explained in more detail why the supply guarantee which forms a part of the application for PBS listing does not constitute an offer to supply. Most relevantly, although the PBS applicant undertakes to guarantee the supply of the product at the time of applying for listing, the guarantee is effectively subject to the determination as to PBS listing being made. The Court notes that an ‘offer’ may be accepted or rejected and reasons that:
The Minister accepts or rejects the application for listing by either determining the brand of a pharmaceutical item or not…The Minister, it is apparent, will not make such a determination without the assurance [as to supply], but the assurance itself is not being proposed, tendered, presented or expressed for acceptance or rejection by the Minister…Acceptance or rejection by the Minister is of the determination of the brand of a pharmaceutical item. If the determination is made and is in force, then the statutory provisions operate and the respondents…will be subject to the guarantee of supply obligation… (at 17)
Other aspects of the primary judgement are also under appeal, however the present issue was determined in advance due to the requirement for the PBS application in question to be lodged by 1 May 2017 if the earliest possible listing date after patent expiry is to be achieved.
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