Senator BROWN (12:30 PM) —The minister has made a pretty effective argument as to why the patent extension should not occur—that is, it would be cheaper for the government and cheaper for consumers—but it flies in the face of the incentive side of the argument, which is that research and development into effective drugs for people who are in ill health in Australia will be stimulated by this move.

I am arguing that the amendments are necessary because it is quite unfair to single out a number of drugs by a small number of companies for different treatment. The arguments that the minister brings forward apply across the board, whichever way you take it. By the way, the Astra pharmaceutical company has been lobbying on this matter since last year and, so far as I am aware, this legislation came into the House of Representatives only a few weeks ago, so it is not quite right to say that it is a last-minute bid. But, even if it were, that is what the bicameral system is about. It gives the opportunity for people affected by legislation that comes into the House of Representatives—which, very often, is not flagged—to pick up on it and go to the house of review, which is the Senate. That is the function that we serve in this place.

I think that the committee ought to hear from the minister a further elaboration or something more specific about how the government is going to review the situation in the wake of the passing of the legislation. Rather than put the committee to a one-page but very detailed and complicated explanatory memorandum to my proposed amendment, I seek the leave of the committee to incorporate that explanatory memorandum into Hansard.

Leave granted.

The document read as follows—

EXPLANATORY MEMORANDUM TO PROPOSED AMENDMENT TO INTELLECTUAL PROPERTY LAWS AMENDMENT BILL 1997

1. The object of the proposed amendments to the Intellectual Property Laws Amendment Bill 1997 (`Bill ') is to allow all existing pharmaceutical patents to apply for an extension of up to five years to provide all patents up to 15 years `effective patent life'. As the proposed legislation is currently drafted, the amendments do not apply to patents which were granted for a term of 16 years under the Patents Amendment Act 1989 or the Patents Act 1990 and which were due to expire prior to 1 July 1995, but which received a four year extension.

2. So that patents which were granted for a term of 16 years and have received a four year extension are eligible to apply for an extension under the new provisions, the proposed amendments to the Bill delete the exclusion in clause 8 of Schedule 1 , and insert transitional provisions (`Transitional Provisions '). Clause 9 sets out the criteria for a patentee of a pharmaceutical patent to be eligible for an extension under the proposed section 70 of the Patents Act 1990 . Clause 9(d) specifies that patentees under the transitional provisions will be eligible to apply under section 70 if the patent has not expired at the time the Bill receives Royal Assent. This it to ensure that no patent is excluded from eligibility merely by reason of any delayed commencement date of the Schedule .

3. So that patents which were granted for a term of 16 years and have received a four year extension (and are still in force at the time the Act receives Royal Assent) are eligible to apply for an extension under the new provisions, clause 10 of Schedule 1 of the Bill deems such patents to be granted for a 20 year term, when a patentee applies for an extension under the provisions. An application for extension must be made within six months of commencement.

4. If the Commissioner refuses an application, pursuant to section 74 or section 75 , by a patentee of a deemed 20 year patent for an extension under the new provisions, the term of the deemed 20 year patent reverts to a 16 year patent plus a four year extension (clause 11 ).

5. Clause 12 ensures that patents eligible for extensions under the Transitional Provisions have the same rights as other twenty year patents under section 79 . That is, if an extension is granted after the patent has expired, the patentee's exclusive rights are protected until the extension is granted, as if the patent were in force.

6. Under clause 13 , springboarding by generic pharmaceutical manufacturers preparing for market is permitted at any time. This is to ensure that generic pharmaceutical companies who may have already started springboarding pursuant to provisions under the Patents Amendment Act 1989 and the Patents Act 1990 , which permit springboarding during the last two years of the full year extension period, may continue to do so.