Evergreening

Evergreening is any of various legal, business and technological strategies by which producers extend their patents over products that are about to expire, in order to retain royalties from them, by either taking out new patents (for example over associated delivery systems, or new pharmaceutical mixtures), or by buying out, or frustrating competitors, for longer periods of time than would normally be permissible under the law.'We are not importing the Hatch-Waxman legislation into Australian law as a result of the free trade agreement... will not extend the time of the marketing approval process, and it does not add or provide any additional rights to the patent holders in that process...there is no injunction that can be applied under this article...it will be clear in the legislation tomorrow....we are establishing a measure in the marketing approval process that will fully meet the commitments under this article.' 'If Australia's law is not sufficient to prevent the marketing of a product, or a product for an approved use, where the produce or use is covered by a patent, Australia will have acted inconsistently with the Agreement. We will be monitoring the matter closely, and reserve all rights and remedies as discussed below. We also remain concerned about recent amendments to sections 26B(1)(a), 26C and 26D of the Therapeutic Goods Act of 1989. Under these amendments, pharmaceutical patents owners risk incurring significant penalties when they seek to enforce their patent rights. These provisions impose a potentially significant, unjustifiable, and discriminatory burden on the enjoyment of patent rights, specifically on owners of pharmaceutical patents. I urge the Australian Government to review this matter, particularly in light of Australia's international legal obligations. The United States reserves its rights to challenge the consistency of these amendments with such obligations.' Evergreening is any of various legal, business and technological strategies by which producers extend their patents over products that are about to expire, in order to retain royalties from them, by either taking out new patents (for example over associated delivery systems, or new pharmaceutical mixtures), or by buying out, or frustrating competitors, for longer periods of time than would normally be permissible under the law. Evergreening is not a formal concept of patent law; it is best understood as a social idea used to refer to the myriad ways in which pharmaceutical patent owners use the law and related regulatory processes to extend their high rent-earning intellectual property rights particularly over highly profitable (either in total sales volume or price per unit) 'blockbuster' drugs. Thus, while the courts are an instrument frequently used by pharmaceutical brand name manufacturers to prolong their patent royalties, evergreening is rarely mentioned explicitly by judges in patent protection cases. The term usually refers to threats made to competitors about a brand-name manufacturer's tactical use of pharmaceutical patents (including over uses, delivery systems and even packaging), not to extension of any particular patent over an active product ingredient. The evergreening process has caused some controversy in the pharmaceutical industry. In this context, evergreening may be used by manufacturers of a particular drug to restrict or prevent competition from manufacturers of generic equivalents to that drug. In 2002, an extensive and lengthy inquiry by the US Federal Trade Commission (FTC) found that the Hatch-Waxman legislation or Drug Price Competition and Patent Term Restoration Act (which was instrumental in establishing the US generic pharmaceuticals industry) had resulted in as many as 75% of new drug applications by generic drug manufacturers experiencing legal actions under patent laws by the original brand name patent owner. These were driving up US drug costs by keeping the cheaper generic versions off the market. The FTC recommended only one evergreening injunction against a potential generic market entrant be permitted per product, and an expedited process of resolving such claims. The process of evergreening may involve specific aspects of patent law and international trade law. Linkage evergreening is the process whereby pharmaceutical safety, quality and efficacy regulators are required to 'link' their normal evaluation with an assessment of whether an impending generic product may infringe an existing patent. A requirement for the AUSFTA to come into force was fulfilment of the article 17.10.4 linkage obligation; done by amendments to the Therapeutic Goods Act 1989 (Cth). The amendments inserted a new section 26B which required applicants for marketing approval to certify their product would not infringe a valid patent claim, or that the patent holder had been notified of the application.