Otsuka Pharmaceutical Co., Ltd v Generic Health Pty Ltd (No 3)

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judge: YATES J
• Judgment Date: 28 February 2020
• Neutral Citation: [2020] FCA 222
• Date: 28 February 2020

FEDERAL COURT OF AUSTRALIA

Otsuka Pharmaceutical Co., Ltd v Generic Health Pty Ltd (No 3) [2020] FCA 222

File numbers:	NSD 121 of 2012NSD 837 of 2015
Judge:	YATES J
Date of judgment:	28 February 2020
Catchwords:	PRACTICE AND PROCEDURE – enforcement of undertakings as to damages - leave to amend pleadings to withdraw admissions – factors relevant to the exercise of discretion – leave granted
Legislation:	Federal Court Rules 2011 (Cth) r 26.11 National Health Act 1953 (Cth)
Cases cited:	Australian Competition and Consumer Commission v Construction, Forestry, Mining and Energy Union [2007] FCA 1390 Celestino v Celestino [1990] FCA 299 Centrestate Exports Pty Ltd v Amarantos Shipping Co Ltd [2005] SASC 158 Cropper v Smith (1884) 26 Ch D 700 Jeans v Commonwealth Bank of Australia [2003] FCAFC 309; 204 ALR 327 Otsuka Pharmaceutical Co., Ltd v Generic Health Pty Ltd [2019] FCA 230 Sigma Pharmaceuticals (Australia) Pty Ltd v Wyeth [2018] FCA 1556
Date of hearing:	11 and 17 September 2019
Registry:	New South Wales
Division:	General Division
National Practice Area:	Intellectual Property
Sub-area:	Patents and associated Statutes
Category:	Catchwords
Number of paragraphs:	66
Counsel for the Applicants/Appellants:	Mr S M Nixon SC and Mr J J Hutton
Solicitor for the Applicants/Appellants:	Jones Day
Counsel for the Respondents:	Mr S G Habib SC and Mr A R Lang
Solicitor for the Respondents:	Wrays Lawyers

ORDERS

		NSD 121 of 2012
BETWEEN:	OTSUKA PHARMACEUTICAL CO., LTD First Applicant/First Appellant ; BRISTOL-MYERS SQUIBB COMPANY Second Applicant/Second Appellant
AND:	GENERIC HEALTH PTY LTD (ACN 110 617 859) First Respondent ; COMMONWEALTH OF AUSTRALIA Other

JUDGE:	YATES J
DATE OF ORDER:	28 FEBRUARY 2020

THE COURT ORDERS THAT:

1. Leave be granted to Otsuka/BMS to withdraw paras 28, 29, 30 and 31(a) of the Response to Statement of Particulars of Claim for Damages filed in Generic Health’s enforcement proceedings, and to file an amended Response to Statement of Particulars of Claim for Damages in the form annexed to their interlocutory application dated 17 April 2019.

2. Otsuka/BMS pay Generic Health’s costs thrown away by reason of the amendments sought.

3. Otsuka/BMS pay the costs of the application to amend.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ORDERS

		NSD 837 of 2015
BETWEEN:	OTSUKA PHARMACEUTICAL CO., LTD First Applicant/First Appellant ; BRISTOL-MYERS SQUIBB COMPANY Second Applicant/Second Appellant
AND:	GENERIC HEALTH PTY LTD (ACN 110 617 859) First Respondent ; COMMONWEALTH OF AUSTRALIA Other

JUDGE:	YATES J
DATE OF ORDER:	28 FEBRUARY 2020

THE COURT ORDERS THAT:

1. Leave be granted to Otsuka/BMS to withdraw paras 30, 31, 32 and 33(a) of the Response to Statement of Particulars of Claim for Damages filed in Generic Health’s enforcement proceedings, and to file an amended Response to Statement of Particulars of Claim for Damages in the form annexed to their amended interlocutory application dated 17 September 2019.

2. Otsuka/BMS pay Generic Health’s costs thrown away by reason of the amendments sought.

3. Otsuka/BMS pay the costs of the application to amend.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

YATES J:

Introduction

1. Otsuka Pharmaceutical Co., Ltd (Otsuka) and Bristol-Myers Squibb Company (BMS) (together, Otsuka/BMS) seek to amend their Response to Statement of Particulars of Claim for Damages filed in proceeding NSD 121/2012 (the primary proceeding) on 20 July 2017 in response to a Statement of Particulars of Claim for Damages filed by Generic Health Pty Ltd (Generic Health) on 15 June 2017.

2. The context in which these documents were filed is explained in Otsuka Pharmaceutical Co., Ltd v Generic Health Pty Ltd [2019] FCA 230 at [1] - [17] and need not be repeated in these reasons, save to note that Generic Health claims compensation pursuant to undertakings as to damages given by Otsuka/BMS in patent infringement proceedings in which Otsuka/BMS obtained an interim injunction against Generic Health on 22 March 2012 (the interim injunction).

3. Otsuka/BMS also seek to amend their Response to Statement of Particulars of Claim for Damages taken to have been filed on 20 July 2017 in proceeding NSD 837/2015, which was an appeal from the judgment given in the primary proceeding (the appeal proceeding), in response to a Statement of Particulars of Claim for Damages filed by Generic Health on 18 July 2017. Generic Health claims compensation pursuant to undertakings as to damages given by Otsuka/BMS in the appeal proceeding in which the interim injunction was continued (they obtained a stay of an order made in the primary proceeding lifting the injunction.)

4. I will refer to Generic Health’s claims for compensation in the primary proceeding and the appeal proceeding as Generic Health’s enforcement proceedings. I will refer to Otsuka/BMS’s Response to Statement of Particulars of Claim for Damages filed in the primary proceeding and their corresponding Response to Statement of Particulars of Claim for Damages filed in the appeal proceeding as the Responses.

5. On 21 June 2018, approximately one year after the commencement of Generic Health’s enforcement proceedings, the Commonwealth of Australia filed claims for compensation in the primary and in the appeal proceeding (the Commonwealth’s enforcement proceedings) to which Otsuka/BMS have responded by filing, in each proceeding, a document styled Points of Defence.

6. In its Statements of Particulars of Claim for Damages filed in the primary proceeding and the appeal proceeding, Generic Health alleges that, by reason of the interim injunction that was granted, and continued pending the determination of Otsuka/BMS’s appeal, it was restrained from importing, marketing, taking orders for, selling, supplying, offering to supply or otherwise exploiting certain products (the GH products) in Australia from 22 March 2012 until 21 September 2016. It further alleges that, during this period, it was restrained from listing the GH products under the Pharmaceutical Benefits Scheme (PBS) maintained by the Commonwealth under the National Health Act 1953 (Cth). It further alleges that, if not for the interim injunction, it would have obtained PBS listing for the GH products on 1 April 2012 and commenced to sell those products on the “PBS market” on 1 April 2012.

7. In their Responses, Otsuka/BMS admit these allegations.

8. In the Commonwealth’s enforcement proceedings, the Commonwealth makes similar allegations—in particular, allegations that, if not for the interim injunction, Generic Health would have obtained PBS listing of the GH products on 1 April 2012 and, from no later than that date, supplied those products in competition with Otsuka’s relevant PBS products.

9. In their Points of Defence filed in the Commonwealth’s enforcement proceedings, Otsuka/BMS deny these allegations.

10. The decision referred to at [2] above was given in the Commonwealth’s enforcement proceedings and concerned the question whether Otsuka/BMS’s denials should be struck out on pleading grounds or as an abuse of the Court’s process (the ...