Australia: Federal Court overturns injunction restraining supply of GSK's Children's Panadol product

Last Updated: 5 December 2013

By Richard Jarvis and Cara Gerace

GlaxoSmithKline Australia Pty Ltd v Reckitt Benckiser Healthcare (UK) Limited [2013] FCAFC 102

In September this year, the Full Federal Court of Australia, lifted an injunction restraining the supply of GlaxoSmithKline Australia Pty Ltd's (GSK's) Children's Panadol 1-5 years which incorporated a liquid dispensing apparatus.

Reckitt Benckiser Healthcare (UK) Limited (Reckitt) brought proceedings against GSK in May 2013 claiming that the liquid dispensing apparatus which accompanied its Children's Panadol 1-5 years product infringed its patent, and sought injunctive relief to restrain the supply of that product coming into the winter cold and flu season.

The key factors that led to GSK's injunction being lifted

The Full Court, comprising Justices Bennett, Jagot and Griffiths, lifted the injunction initially granted by Justice Rares in July 2013, after finding that:

  • GSK's case for non-infringement was stronger than Reckitt's case; and
  • the "balance of convenience" did not favour the granting of an injunction taking into account public health safety factors and the public interest in having GSK's Children's Panadol 1-5 years available with the safer dispensing apparatus.

Facts of the GSK v Reckitt Children's Panadol case

Reckitt's first injunction against GSK's Children's Panadol product

In May 2013, Reckitt commenced proceedings against GSK in the Federal Court of Australia claiming that GSK's Children's Panadol 1-5 years product which incorporated a liquid dispensing apparatus infringed its patent. Reckitt sought interlocutory injunctive relief to restrain GSK from supplying its Children's Panadol 1-5 years product.

The liquid dispensing apparatus in question comprised a bottle, bottle neck liner and flat-nosed syringe (the Original Syringe). The flat-nosed syringe inserted into and formed a seal with the neck of the bottle to draw up liquid whilst the bottle was inverted. The purpose of this procedure was to accurately measure the correct dosage of paracetamol.

On 28 May 2013, the trial judge (Justice Rares) granted an injunction against GSK restraining its supply of Children's Panadol 1-5 years with the Original Syringe. In granting the injunction, Justice Rares considered that Reckitt had a relatively strong prima facie case of infringement and found that the "balance of convenience" favoured the granting of an injunction against GSK. A decisive factor for Justice Rares in that finding was that he considered it would be relatively easy for GSK to continue to market its Children's Panadol 1-5 years product with only minor modifications to the product (to remove the bottle neck liner) and its packaging to avoid infringement of the Reckitt patent.

Reckitt's second injunction against GSK's alternative Children's Panadol product

Soon after the first injunction was granted, GSK informed Reckitt that it intended to release a new form of the liquid dispensing apparatus (the Alternative Syringe). The Alternative Syringe had the same characteristics as the Original Syringe but GSK narrowed the distal tip of the flat-nosed syringe in comparison to the rest of the syringe. GSK conceded that the Alternative Syringe was essentially a "design-around" of claim 1 in the Reckitt patent.

At the hearing for the second injunction in July 2013, Justice Rares considered that the only issue that had to be decided was whether Reckitt had a sufficient prima facie case of infringement in relation to the Alternative Syringe, and therefore he could rely on his previous findings on validity of the patent and balance of convenience. Subsequently, Justice Rares excluded new evidence which GSK sought to rely on that went to the issue of balance of convenience.

On 17 July 2013, Justice Rares once again found that Reckitt had a sufficiently strong prima facie case of infringement and granted an injunction against the Alternative Syringe.

GSK's Full Federal Court appeal against the injunction of its alternative Children's Panadol product

GSK subsequently sought leave to appeal from the Full Federal Court of Australia against Justice Rares' decision to grant the second injunction against the Alternative Syringe on a number of grounds including that the trial judge:

  1. erred in his construction of the patent; and
  2. wrongly excluded evidence.

GSK's application for leave to appeal was heard by the Full Court together with GSK's appeal itself.

Construction of the Patent gave Reckitt a stronger prima facie case of infringement than GSK

The primary issue that arose was whether claim 1 of the Reckitt patent required the barrel of the syringe to have a uniform diameter along the entire length of the syringe from its flat-nosed distal tip to its other end. That was the interpretation advanced by GSK in support of its contention that the Alternative Syringe which had a narrower distal tip did not infringe the patent.

Alternatively, Reckitt argued that all claim 1 of the patent required was that the flat-nosed distal tip of the syringe (which engaged with and formed a seal with the bottle neck liner) had to have a uniform diameter. Reckitt further submitted that it did not matter what size the syringe was above that point, and on that basis the syringe could have two barrels with different diameters.

In finding that Reckitt had a stronger prima facie case of infringement than GSK's non-infringement case, the trial judge, Justice Rares took into account the substance or idea of the invention disclosed in the Reckitt patent.

On appeal, the Full Federal Court did not agree with Justice Rares' assessment and considered that whilst Reckitt had an arguable case of infringement, it was not a strong case and that GSK's case for non-infringement was stronger.

All "essential integers" were not taken by GSK

The Full Federal Court considered that the words of claim 1, the description in the patent specification and the figures of the patent favoured GSK's interpretation of claim 1. In coming to this conclusion, the Full Federal Court emphasised that when determining whether a product infringes a particular claim of a patent, the substance or idea of the invention should only be considered if all of the "essential integers" of the claim have been taken. There cannot be infringement if all of the "essential integers" of the claim have not been taken.

"Balance of convenience" evidence wrongly excluded

As mentioned, one of the reasons the Justice Rares granted the first injunction was that he considered it would be "relatively easy" for GSK to make minor modifications to its Children's Panadol's 1-5 years product in order to avoid infringement of the Reckitt patent.

At the hearing for the second injunction against the Alternative Syringe, GSK sought to rely on additional evidence which explained why it would be impracticable and unsafe to make the modifications suggested by Justice Rares' at the first hearing and also explained the reasons for GSK deciding to pursue and adopt the option of the Alternative Syringe (which included an explanation why that option was the safest option for consumers). Nevertheless, Justice Rares excluded that evidence on the basis that all that had to be decided at the second hearing was whether the Alternative Syringe infringed the Reckitt patent.

On appeal, the Full Federal Court considered that the new evidence which GSK sought to rely on was relevant and important to making an assessment of the balance of convenience, and found that Justice Rares' erred in his decision to exclude it.

Summary of the reasons for the decision to overturn the injunction against GSK

The Full Federal Court granted leave to appeal. In determining the appeal, it considered that this was not an appropriate case to order interlocutory injunctive relief and lifted the second injunction restraining the supply of GSK's Children's Panadol 1-5 years with the Alternative Syringe for the following reasons:

  1. whilst Reckitt had an arguable case of infringement, it was not a strong case, and based on the existing evidence, GSK's case for non-infringement was stronger;
  2. despite the Justice Rares' finding, there was no reasonable option for GSK to supply the Children's Panadol 1-5 years product without the bottle neck liner;
  3. the new evidence which GSK sought to rely on (and which the Full Federal Court permitted) adequately explained why GSK choose to adopt the Alternative Syringe and why that was the safest option for consumers; and
  4. there was a strong public interest in consumers having the option of being able to choose between Children's Panadol 1-5 years with the safe dispensing apparatus and other paediatric analgesics.

The case is set down for trial next June 2014 before Justice Rares. We will keep you informed of any developments.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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