New regulations for e-prescribing and their impact on patent litigation in Australia

5 mins  29.10.2019 Grace Pead, Rebecca Pereira
We provide an update on changes to electronic prescribing of medicines in Australia, and how this might impact on patent disputes.

Key takeouts

New regulations come into effect on 31 October 2019 that affect electronic prescribing for PBS-listed medicines. The changes do not apply to handwritten prescriptions and certain other types of prescriptions.
The key change is that the active ingredient of the medicine must be named on an electronic PBS prescription, instead of the current practice of stating the brand name only. This is part of the Federal Government's initiatives directed at increasing the uptake of generic and biosimilar medicines.
In future patent litigation it will be important to consider whether these changes have affected the likelihood of generic and biosimilar medicines being dispensed to patients in place of their branded equivalents.

Prescribing practices for PBS medicines

The Pharmaceutical Benefits Scheme (PBS) controls the prescribing of, and payment of Government subsidies for, particular medicines.

If multiple brands of the same medicine are listed on the PBS as being bioequivalent, a pharmacist can dispense a generic medicine when a patient presents a prescription on which the prescriber has (a) written the active ingredient only (eg "rosuvastatin"), or (B) has written the brand name (eg for rosuvastatin, "Crestor") but has not ticked the “brand substitution not permitted" box and the patient agrees to take the generic medicine. Currently in Australia, general practitioners more commonly prescribe by brand name.

Regulatory changes taking effect on 31 October 2019 will make active ingredient prescribing the default for electronic PBS prescriptions, and as a result require changes to clinical prescribing software.

A key purpose of the regulations is to increase the uptake of generic and biosimilar medicines, and improve the long-term financial sustainability of the PBS. The regulations may have this effect by:

(a) increasing the number of prescriptions that allow for generic substitution, and
(b) encouraging prescribers, pharmacists, and patients to refer to medicines by their active ingredient, which should mean that patients are more likely to agree to supply of a generic in place of an equivalent branded medicine.

Impact on future IP litigation

When the owner of a pharmaceutical patent enforces that patent against a supplier of a generic medicine there is often a dispute about:

(a) the extent to which prescribers do or will allow for generic "substitution" of the branded medicine, and
(b) the extent to which pharmacists do or will actively promote dispensing generic medicines in place of branded medicines.

Evidence about such matters is typically raised by both patent holders and generic medicine suppliers in interlocutory injunction applications, substantive infringement claims, damages claims for infringement, and claims for compensation pursuant to a cross-undertaking as to damages.

When involved in such litigation it will now be important to assess whether the new requirement for including active ingredients on electronic PBS prescriptions has had the intended effect of increasing the proportion of generic medicines dispensed. This will involve discussions with doctors and pharmacists about how widespread the use of electronic prescriptions becomes.

Further, the regulations only allow for electronic prescriptions by brand name where 'clinically necessary'. In previous cases involving patents for second medical uses, generic manufacturers have sought to avoid injunctions by undertaking to notify prescribers to specify the brand name and tick the "brand substitution not permitted" box on prescriptions for the patented indication. However, the new requirements for electronic prescribing software may mean that it is not possible for prescribers to take the actions proposed in notices under such undertakings.

What are the new requirements for electronic prescribing?

In more detail, under the National Health (Pharmaceutical Benefits) Amendment (Active Ingredient Prescribing) Regulations 2019 (Cth):

  • All electronic PBS prescriptions must include the name of the active ingredient. 
  • The regulations do not apply to handwritten prescriptions, paper-based medication charts in the residential aged-care setting, and prescriptions for medicines with four or more active ingredients, and items determined by the Secretary to be excluded for practicality and safety reasons. 
  • Prescribers can still prescribe by brand where clinically necessary, including where the medication prescribed may pose a potential patient safety risk if the brand is not specified, or to promote patient compliance where a patient is familiar with a particular brand. 
  • Where the prescriber nevertheless makes a clinical decision to specify a brand name on the electronic prescription, the name of the active ingredient must appear first. 
  • Prescribing software must not default to include brand names on prescriptions. In this way the regulations compel doctors to make a clinical decision regarding inclusion of a brand name. 
  • Following the 31 October 2019 commencement date, there is a 12 month transition period to ensure that prescribers have sufficient time to update their prescribing software to comply with the new requirements. 

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