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High Court of New Zealand Decisions |
Last Updated: 23 August 2011
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV 2009-404-001795
UNDER the Patents Act 1953
IN THE MATTER OF infringement of New Zealand Patent number 331933
BETWEEN SANOFI-ADVENTIS DEUTSCHLAND GMBH
First Plaintiff
AND SANOFI-AVENTIS NEW ZEALAND LIMITED
Second Plaintiff
AND AFT PHARMACEUTICALS LIMITED Defendant
AND PHARMAC Applicant/Interested Party
Hearing: 3 March 2011
Counsel: M G Colson/K J Dobbs for applicant
G F Arthur for plaintiffs
No appearance for defendant (abiding the decision of the Court) Judgment: 9 August 2011 at 4:30 PM
JUDGMENT OF ASSOCIATE JUDGE ABBOTT
This judgment was delivered by me on 9 August 2011 at 4:30pm
pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors:
Bell Gully, PO Box 1291, Wellington 6140 for applicant
A J Park, PO Box 949, Wellington 6140 for plaintiffs
A J Pietras & Co, PO Box 30173, Lower Hutt 5010 for defendant
Case Officer: Vivianne.Katia@justice.govt.nz
SANOFI-ADVENTIS DEUTSCHLAND GMBH V AFT PHARMACEUTICALS LIMITED HC AK CIV 2009-
404-001795 9 August 2011
Introduction
[1] The Pharmaceutical Management Agency (Pharmac) has applied for orders that it be joined in this proceeding as an interested party (as distinct from a defendant). It seeks the following limited rights:
[a] To receive pleadings and evidence filed;
[b] To appear at interlocutory and substantive hearings; and
[c] With leave, to provide submissions.
[2] The plaintiffs, Sanofi-Aventis Deutschland GMBH (“Sanofi GMBH”) and Sanofi-Aventis New Zealand Limited (“Sanofi NZ”) oppose the application (I will refer to them jointly as (“Sanofi”). The defendant, AFT Pharmaceuticals Ltd (AFT), supports the application but did not attend the hearing. Its counsel has advised that it will abide the decision of the Court.
Overview of the case
[3] This proceeding concerns an intellectual property dispute between two pharmaceutical companies, Sanofi and AFT. Sanofi GMBH is a German pharmaceutical company. It owns New Zealand patent 331933, dated 7 March 1997, which protects a compound of leflunomide and teriflunomide (sold under the name ARAVA) that is used principally for treatment of rheumatoid arthritis. Teriflunomide is the metabolite of leflunomide. Sanofi NZ is the New Zealand distributor of Sanofi GMBH‘s products.
[4] Sanofi held a New Zealand patent (granted in 1978) for leflunomide itself. That patent expired in 1999. AFT has imported and marketed a generic leflunomide product branded AFT-leflunomide since July 2007. Sanofi alleges that this product infringes its 1997 patent for the leflunomide-teriflumide compound. AFT does not
concede infringement. Sanofi seeks an injunction to stop the sale of AFT- leflunomide.
[5] In a counterclaim, AFT alleges that Sanofi‘s 1997 patent is invalid. It seeks an order revoking the patent.
[6] No orders are sought against Pharmac.
Pharmac
[7] Pharmac is a statutory (Crown) entity established by s 46 of the New Zealand Public Health and Disability Act 2000. It is responsible for the operation and development of a list of all pharmaceuticals subsidised by District Health Boards, known as a pharmaceutical schedule (“the schedule”). Pharmac makes decisions about which pharmaceuticals should be listed on the schedule, what subsidies should be paid for each of those pharmaceuticals, and the eligibility and criteria for the provision of subsidies. Pharmac makes these decisions in the context of its statutory objective to secure, for eligible people in need of pharmaceuticals, the best health outcomes that are reasonably achievable from pharmaceutical treatment and from within the amount of funding provided. Pharmac manages a notional budget that is set by the Minister of Health each year.
[8] Pharmac has developed expenditure management strategies in order to meet its statutory objective. The strategies include:
[a] Applying reference pricing. Where reference pricing is applied, all pharmaceuticals in any given therapeutic sub-group (that is, a group of pharmaceuticals having the same or similar therapeutic effect) are subsidised at the level of the lowest priced pharmaceutical in that sub- group.
[b] Entering into listing contracts with pharmaceutical suppliers. These contracts contain the terms on which a pharmaceutical is listed on the schedule. A listing contract for a pharmaceutical used in the
community specifies the subsidy payable for that pharmaceutical, and the price at which the pharmaceutical supplier must supply the pharmaceutical.
[c] Entering into risk-sharing arrangements (for financial or other risks) with pharmaceutical suppliers, including (but not limited to) rebate arrangements for a particular pharmaceutical market;
[d] Tendering, or issuing requests for proposals, or entering into arrangements, for the supply of one or more subsidised brands of a pharmaceutical or one or more members of a sub-group, which may entail the delisting of other brands of the pharmaceutical or other members of a sub-group.
[9] Pharmac has made a number of funding decisions relating to the pharmaceutical leflunomide. ARAVA (Sanofi‘s brand) has been listed and subsidised in New Zealand since 1 April 2002. AFT‘s brand of leflunomide – AFT- Leflunomide – has been listed and subsidised since July 2007, at lower prices than those of ARAVA. Sanofi has approximately 82% of the leflunomide market (by volume). AFT has the balance. The savings achieved by Pharmac due to the presence in the market of generic leflunomide (AFT-Leflunomide) are approximately $130,000 per annum.
[10] The supply of leflunomide is currently dictated by listing contracts between
Pharmac and AFT (dated 26 April 2007) and between Pharmac and Sanofi (dated
25 October 2006). Prior to Sanofi commencing this proceeding, Pharmac sought tender bids for supply of leflunomide. Sanofi submitted a bid; AFT did not. Pharmac has not made a decision whether to accept any tender bid.
Pharmac’s interest in this proceeding
[11] Pharmac contends that it is directly affected by, and necessarily interested in, the issues before the Court, as the decision could affect the current and future supply of leflunomide. If Sanofi‘s patent is found to be valid and infringed, the Court may
grant an injunction to stop the sale of AFT-leflunomide. ARAVA, and potentially other brands of leflunomide which do not infringe the patent, will presumably continue to be available. On the other hand, if AFT‘s counterclaim is successful, and Sanofi‘s patent is revoked, it is possible that additional generic leflunomide may enter the market and Pharmac will be free to renegotiate arrangements for its supply, potentially with significant savings for its budget.
[12] Pharmac has had a significant level of involvement in this proceeding to date. It has provided affidavits in reply to affidavits filed by Sanofi, and it has given two undertakings in respect of the subsidies currently provided for ARAVA. The second of these undertakings is no longer operative. However, the first states that Pharmac will not reference price ARAVA to AFT-Leflunomide until the present litigation has been resolved either by way of substantive judgment or settlement between the parties. This undertaking remains in effect and continues to have a financial impact on Pharmac. In the absence of this undertaking, and if Pharmac were to reference price ARAVA to AFT-Leflunomide, it would make additional savings of approximately $600,000 per annum. The undertaking is, in effect, costing Pharmac this sum.
[13] This undertaking was voluntary. Pharmac says that it offered the undertaking in an attempt to ensure that AFT-Leflunomide would remain listed on the schedule and so that Pharmac could continue to make savings (approximately $130,000 per annum) from its presence, or conversely so that Pharmac did not have to pay a higher price for medicines it was currently purchasing such that it would be necessary to dis-invest in other medicines.
[14] Pharmac seeks to be joined for limited purposes only: it does not wish to be joined as a plaintiff or defendant. It contends that it is seeking a level of participation that is commensurate with its interests, in order to protect those interests.
The legal basis for the application
[15] The application was made under r 4.56 of the High Court Rules 2008, or alternatively in reliance on r 7.9 in conjunction with the Court‘s inherent jurisdiction. In either case, Pharmac contended that its presence before the Court may be necessary to adjudicate on and settle all questions involved in the proceeding, and that it is directly affected by, and necessarily interested in, the issues before the Court.
[16] At the commencement of the hearing, counsel for Pharmac accepted that r 4.56 could not apply directly as Pharmac was not seeking to be added as a defendant. He relied instead on the Court‘s inherent jurisdiction, but submitted that it was appropriate to have regard to the criteria under r 4.56 and authorities in relation to that rule.
[17] This change to the basis for the application is appropriate. Rule 4.56(1)
provides:
4.56 Striking out and adding parties
(1) A Judge may, at any stage of a proceeding, order that—
(a) the name of a party be struck out as a plaintiff or defendant because the party was improperly or mistakenly joined; or
(b) the name of a person be added as a plaintiff or defendant because -
(i) the person ought to have been joined; or
(ii) the person's presence before the court may be necessary to adjudicate on and settle all questions involved in the proceeding.
On its plain wording, the rule does not empower the Court to add an entity as an
“interested party” or “intervener” with limited rights. The Court can only add a plaintiff or a defendant. It is not in dispute, and there is authority1 for the proposition, that r 4.56(1)(b) allows a non-party to apply to be added as a plaintiff or
a defendant. Hallam v Ryan is not authority, however, for the proposition that
1 Hallam v Ryan (1989) 3 PRNZ 132.
r 4.56(1)(b) allows an entity to be added to the proceedings by the Court as a non- party, intervener or interested party.
[18] However, while the strict application of r 4.56 excludes interveners from being joined as an “interested party”, they have been joined, in some cases, under the inherent jurisdiction of the Court and the application of rr 1.6 and 7.9 of the High Court Rules.
[19] The High Court (as a superior court of general jurisdiction) has inherent jurisdiction to allow it to administer the laws of New Zealand.2 Ancillary or incidental to that jurisdiction are inherent powers, including the power to regulate its own procedures (subject to the rules of court and to statute).
[20] Rule 1.6 enables the Court to dispose of any case where there is no procedure prescribed by any Act or regulation. The rule is designed to provide a mechanism to deal with procedural gaps rather than to lay down general principles as to what the Court can or cannot do. Its scope is to enhance rather than to curtail the Court‘s jurisdiction. It reads:
1.6 Cases not provided for
(1) If any case arises for which no form of procedure is prescribed by any Act or rules or regulations or by these rules, the court must dispose of the case as nearly as may be practicable in accordance with the provisions of these rules affecting any similar case.
(2) If there are no such rules, it must be disposed of in the manner that the court thinks is best calculated to promote the objective of these rules.
[21] Rule 7.9 applies both to a party to proceedings and to an intended party. It provides that the Court may give whatever directions are necessary to enable a party to take appropriate steps to enable the just, speedy and inexpensive determination of the proceeding. Relevant parts of r 7.9 read:
7.9 Directions as to conduct of proceeding
(1) A Judge may, by interlocutory order, -
2 Rosara Joseph “Inherent Jurisdiction and Inherent Powers in New Zealand” (2005)
[2005] CanterLawRw 10; 11 Canterbury Law Review 220 at 223; see also I. H. Jacob “The Inherent Jurisdiction of the Court” (1970) C.L.P 23 at 27-28. -
(a) give directions to secure the just, speedy, and inexpensive determination of a proceeding:
...
...
(e) direct how the hearing of a proceeding is to be conducted.
(3) A party or intended party may apply without notice to a Judge for directions if in doubt about –
(a) whether it is correct or appropriate to join a person as a party; or
...
(c) the correct method of proceedings under these rules.
(4) A step take in accordance with a direction given under subclause (3) must be treated as valid.
[22] Rule 1.2 is also applicable:
1.2 Objective
The objective of these rules is to secure the just, speedy, and inexpensive determination of any proceeding or interlocutory application.
[23] It is apparent from the above that there is nothing in the rules to prevent the Court exercising its inherent jurisdiction to join an interested party in an appropriate case. This Court expressly referred to the use of inherent jurisdiction to join various entities as interested parties or interveners in Golden Bay Marine Farmers Consortium Ltd v Tasman,3 where they sought to intervene in a claim for declaration and a related appeal under the Resource Management Act 1993; it is also the basis on which the Court granted intervener status in an appeal in relationship property proceedings, after forming the view that the step would improve the quality of
information on issues before the Court that the parties might not wish to address:
X v X.4
[24] There are also a number of instances5 where the Court has joined interested parties in proceedings for judicial review, relying both on the specific power6 to give
4 X v X HC Auckland CIV-2006-404-903, 4 July 2006.
6 Judicature Amendment Act 1972, s 10.
directions for hearing of such proceedings and on inherent jurisdiction.7 The reasons for joinder as “interested parties” in the context of judicial review proceedings are discussed in Wilson v Attorney General. The court commented that there is more scope for rights of others to be affected in judicial review proceedings, as frequently,
“the challenge to the exercise of the statutory power or decision of a public body will have consequential effects upon others who obtained beneficial entitlements or expectations following upon the exercise of such power.” 8
[25] The Courts have identified certain criteria as being relevant to applications for joinder as a party under r 4.56, and more specifically for joinder either as a defendant or as an interested party in judicial review proceedings. Although they are not exhaustive, and will not necessarily apply to joinder merely as an interested party in ordinary civil litigation (concerned with the private rights of the litigants) as distinct from public law litigation (where interests extending beyond those of the
litigants may be affected by the impugned decision),9 common sense suggests that
the criteria in judicial review proceedings should be the minimum for the present case.
[26] The test for joinder as a party under r 4.56 is a useful staring point. In Mainzeal Corporation Ltd v Contractors Bonding Ltd10 the Court reviewed authorities here and in the United Kingdom (including a decision of the Privy Council)11 and stated the appropriate test to be whether the rights or liabilities of the party to be joined, to any party to the proceeding, would be directly affected by any order made.
[27] This test has been adopted generally in the judicial review cases dealing with applications for joinder as interested parties,12 and was reformulated by the Full Court in Wilson v Attorney-General13 (adopting both a slightly wider test of “directly
and indirectly affected” and an alternative formulation put forward in
7 Diagnostic Medlab Ltd v Auckland District Health Board & Ors HC Auckland CIV 2006-404-
4724 18 October 2006 and authorities cited at [27] and [28].
8 Wilson v Attorney-General [Judicial Conduct] (No.2) ibid at [19].
9 See for example Diagnostic Medlab Ltd v Auckland District Health Board at [17].
10 Mainzeal Corporation Ltd v Contractors Bonding Ltd (1989) 2 PRNZ 47.
11 Pegang Mining Co Ltd v Choong San (1969) 2 MLJ 52.
12 See Wellington International Airport at [23] and Diagnostic Medlab at [24].
13 Wilson v Attorney-General.
Westhaven Shellfish14 that it would be unjust to decide the issues in the absence of the interested party):
[19] We express our agreement with this comment by Gendall J in Deadman v Luxton HC Wellington CP71/99, 4 May 1999 at 6, in the very different context of judicial review of decisions about fishing quota:
It may often be the case that there is more scope for rights of others to be affected in judicial review proceedings, than in other types of
“plaintiff versus defendant” civil litigation, because frequently the
challenge to the exercise of the statutory power or decision of a public body will have consequential effects upon others who
obtained beneficial entitlements or expectations following upon the
exercise of such power
[20] Emerging from the cases is that joinder is appropriate where the party‘s interests are, or may be, directly or indirectly affected by the judicial review application. In such situations, it would be unjust to decide the issues in the absence of the party so affected, or potentially affects. As Hammond J pointed out in Westhaven Shellfish Ltd v Chief Executive of Ministry of Fisheries (2002) 16 PRNZ 501 (HC) at [14], “joinder is not an all or nothing thing”. Fairness to the plaintiff, who is having another party interposed in his proceeding, demands that the Court consider whether the joinder should be for all or only limited purposes. The level of participation should be only what is necessary to protect the interests of the party being added.
[28] The Courts have also identified as a relevant matter to the exercise of discretion, whether the interested party can add anything to the argument of the existing parties on the issues which the Court has to decide15. The same point has
been phrased in terms of improving the quality of information before the Court:16
There is an undoubted jurisdiction for this Court to grant leave for an interested party to intervene in proceedings before the Court. Exercise of the jurisdiction enables the Court to obtain assistance from a non party in order to improve the quality of information available to the Court on wider issues than the parties may wish to address. In granting intervener status, the Court must endeavour to ensure that the parties will not be prejudiced by the intervention.
[29] It has been said that the discretion to join an interested party is generally exercised more readily in appellate courts, where issues of policy are to the forefront. However, the discretion has been exercised in this Court where the Court considers
that it will be assisted by the perspective of the intervener:
14 Westhaven Shellfish Ltd v Chief Executive of Ministry of Fisheries.
15 See discussion in Wilson v Attorney-General at [25]-[29].
16 X v X at [18]
Generally speaking, this power is exercised more readily in the Court of Appeal and the Supreme Court. By the time a proceeding reaches the appellate level factual disputes can be expected to have been determined, and issues of policy will be to the forefront. This Court has, however, permitted intervention to occur in circumstances where it considers that it will be assisted by the perspective of the intervener: See eg Zaoui v Attorney-General HK AK CIV 2003 404 5872 28 November 2003 Williams J and Hosking v Runting HC Auckland CP 527/02 11 February 2003
Randerson J.17
[30] A further and related point is whether the interests of the intending intervener will be adequately protected by one of the existing parties.18
[31] Other considerations that have been taken into account in the exercise of the
Court‘s discretion are:
[a] Practical implications such as possible delay arising from joinder or distraction from the central issues resulting from the joinder.
[b] The plaintiff‘s wishes (accepting that in general a plaintiff has the right to choose whom it will sue).19
[c] Whether the level of participation sought is necessary to protect the interests of the party seeking to be added.20 (It is to be noted, however, that this element of discretion is derived from the judicial review context).
Issues for Determination
[32] The following issues require determination:
[a] Does Pharmac have a sufficient interest in the outcome of the proceedings?
17 Diagnostic Medlab at [28].
18 Diagnostic Medlab at [29] and [53]–[56].
19 McGechan on Procedure (online looseleaf ed, Brookers) at HR4.56.12.
[b] Should the Court exercise its discretion to join Pharmac as an
“interested party”?
Has Pharmac a sufficient interest?
[33] The authorities set out above establish that before the Court decides whether or not to exercise its discretion, it has to be satisfied that the applicant has a relevant interest (in terms of rights against or liabilities to a party) which is likely to be affected by the decision.
[34] Counsel for Pharmac submitted that both the infringement claim and the revocation counterclaim will directly affect Pharmac‘s rights against, or liabilities to, Sanofi and AFT in respect of the supply of leflunomide and will have a financial affect on it (in terms of achieving its statutory objectives and functions, including its need to manage its budget to achieve the best possible public health outcomes). He argued that this was wider than a mere commercial interest. He also relied on its undertaking to the Court, given to ensure a continuing supply of leflunomide on existing terms until the case was decided. He argued that Pharmac also had a relevant interest in monitoring the status of patents for pharmaceuticals as part of its role in administering the schedule.
[35] Counsel for Sanofi accepted that there were potential financial consequences for Pharmac flowing from the ultimate decision, but submitted that they were no more than an indirect commercial consequence of the Court determining a private dispute between Sanofi and AFT as to their respective rights in relation to the patents. He submitted that Pharmac‘s existing contractual rights in respect of either Sanofi or AFT were not in issue in the proceeding and would remain in place (noting that there was no evidence as to what legal rights could be affected). He also argued that Pharmac could not rely on its voluntary undertaking to assert an interest that did not otherwise exist, and submitted that its interest in monitoring the status of pharmaceuticals was not a right or liability against a party to the litigation.
[36] I accept Sanofi‘s argument that in order to establish an appropriate interest,
Pharmac must show that a legal right or liability against a party will be affected by
the decision on the validity of Sanofi‘s patent, and not merely that the decision will have financial consequences for it in terms of inability to make savings through sales of AFT/leflunomide, or from introduction of other generic brands. Further, I do not regard the undertaking, voluntarily given by Pharmac, as a liability that can form a basis for rights of intervention, nor that its monitoring function is a right entitling it to status of an intervener.
[37] That leaves Pharmac‘s contractual rights against Sanofi and AFT, and whether the indirect effect of a decision on those rights is a sufficient interest. This requires further consideration of the nature of this case.
[38] In the judicial review context, the Full Court in Wilson v Attorney-General considered that it was sufficient to show that the right could be directly or indirectly affected, so that it would be unjust for the proceeding to be determined in the applicant‘s absence. However, a claim of patent infringement is essentially a private dispute between patent-holder and infringing party, although it can have a wider consequence if the validity of the patent is put in question as AFT‘s counterclaim has done. Even so, the dispute will usually proceed merely as a private dispute between these parties, notwithstanding the potentially wider consequences. The possibility of a public interest in the matter is recognised by s 76 of the Patents Act 1953 which empowers the Attorney-General to take part in patent proceedings if, in his opinion, the public interest is or may be involved. However, this does not change the essential nature of the proceeding from that of a private dispute, and the rationale for intervention in judicial review proceedings (the consequential effect on a beneficial entitlement or expectation arising from the statutory power or decision being challenged) is therefore less compelling.
[39] I consider that the Court should exercise its inherent jurisdiction to give a person interested party status in ordinary civil litigation only in exceptional circumstances. Having regard to the fact that this case is essentially a private dispute, and the Attorney-General‘s power to look after any public interest, I consider that Pharmac needs to show that it would be unjust for the parties to determine their patent rights in its absence. It is difficult to see how possible consequences of a finding as to those patent rights (in the form of financial impact
on its budget or renegotiation of its contracts with Sanofi or AFT) can make it unjust to determine them in its absence:21
And so in the case of trade marks – the cases which Mr Astbury sought very ingeniously to avoid by saying, “Oh yes, but in this action the real controversy is the validity of Montforts’ patent.” Now, in a commercial sense, that Montforts will be injured or may be injured is plain enough to anybody who understands the business habits of patentees and the commercial world: but can we say that his patent is affected in any legal sense or way in this particular action? My answer is, No. It has nothing to do with it. Commercially, of course, one sees that it has. Therefore, if we are to stretch this rule in the way we are now asked, it would be to say that whenever a Court is satisfied that anybody will be prejudicially affected by litigation between other people, he is to be at liberty to come in and fight. I do not think the Rule can be construed to extend to any such cases. Nor has there been cited to us any case that goes anything like that length.
[40] The views of the Privy Council in Penang Mining Co Ltd v Choong San22 are also apposite:
The cases illustrate the great variety of circumstances in which it may be sought to join an additional party to an existing action. In their Lordships‘ view one of the principal objects of the rule is to enable the Court to prevent injustice being done to a person whose rights will be affected by its judgment by proceeding to adjudicate upon the matter in dispute in the action without his being given the opportunity of being heard. To achieve the object calls for a flexibility of approach which makes it undesirable in the present case, in which the facts are unique, to attempt to lay down any general proposition which could be applicable to all cases.
It has been sometimes said as in Moser v Marsden23 and in In re I.G. Farbenindustrie A.G.24 that a party may be added if his legal interests will be affected by the judgment in the action but not if his commercial interests only would be affected. While their Lordships agree that the mere fact that a person is likely to be better off financially if a case is decided one way rather than another is not a sufficient ground to entitle him to be added as a party, they do not find the dichotomy between ‗legal‘ and ‗commercial‘ interests helpful. A better way of expressing the test is: Will his rights against or liabilities to any party to the action in respect of the subject matter of the action be directly affected by any order which may be made in the action?
[41] Pharmac cannot show the direct effect on its contractual rights or liabilities which I regard as the minimum needed as the basis for a finding that it would be
unjust not to allow Pharmac to intervene.
21 Moser v Marsden (1892) 9 RPC 214 at 216-217.
22 Penang Mining co Ltd v Choong San (1969) 2 MLJ 52 at 55-56.
23 Moser v Marsden [1892] 1 Ch. 487.
24 In re I.G. Farbenindustrie A.G.[1944] Ch. 41.
Should the Court exercise its discretion to join Pharmac?
[42] There is a further significant factor which counts against the Court exercising its discretion, namely that Pharmac has not shown how its presence as an interested party will assist the Court. It has not said how its presence will improve the quality of information before the Court. AFT is a fully competent party, clearly determined to pursue its claim for revocation. It is represented by experienced counsel. Pharmac has not shown how its statutory objectives and functions could be relevant to the patent determination, but to the extent that they could be relevant, those matters are already before the Court, in evidence provided through AFT. There is no suggestion that that course is no longer available to Pharmac.
[43] In the absence of any evidence that Pharmac could bring a different and relevant perspective on the patent issues, I consider that the interests that it has can be adequately protected by AFT and provision of any relevant evidence in support of AFT‘s case.
[44] Counsel for Pharmac argue that it was almost a party already, having been actively involved up to this point, and having given its undertaking in order to preserve the status quo.
[45] It is understandable that Pharmac has an interest in the outcome of this proceeding, and that it has been keen to advance AFT‘s cause. However, its provision of evidence and its undertaking do not add anything to the question as to how its presence as an interested party will assist the Court decide on the validity of the patent. The provision of the undertaking was a factor in the balance of convenience considerations at the interim injunction stage, but it has not been shown how either aspect will be of significance on the essential issue of validity. I accept the submission of counsel for Sanofi that Pharmac‘s presence gives no additional benefit to the Court but will potentially increase the cost and the time required to resolve the patent dispute.
[46] In the memorandum filed in advance of the hearing, counsel for AFT
submitted that Pharmac would be able to provide perspective on the wider public
interest of ensuring that invalid monopolies were not granted. I am not persuaded that its joinder as an interested party is necessary to advance or develop that argument (it can be done through AFT in the same manner as it has been assisting to date), but in any event this wider public interest is more a matter for the Attorney- General under s 76.25
[47] Counsel for Sanofi also argued that Pharmac should not be able to appear and support a revocation argument when it could not be a full party because that was ultra vires its statutory powers (its function to maintain and manage the pharmaceutical schedule did not extend to seeking revocation of patents). I do not consider it necessary to decide this point in light of the conclusions I have reached on Pharmac‘s interest in the proceeding and whether its presence would assist the Court.
Decision
[48] For the reasons I have given, I find that Pharmac does not have a sufficient interest to entitle it to joinder as an interested party, and has not demonstrated how its presence as an interested party would assist the Court sufficiently to justify the exercise of the Court‘s discretion to join it as an interested party.
[49] As the successful party, Sanofi is entitled to costs. I am not aware of any reason which would justify costs being awarded other than on a scale 2B basis. However, as counsel did not address me on costs, I reserve leave for the parties to file memoranda if they are unable to agree costs on the basis of this indication. Sanofi is to file and serve any memorandum within 15 working days, and Pharmac is
to respond within a further five working days.
Associate Judge Abbott
25 Patents Act 1953, s 76.
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