This article was first published in Kluwer Patent Blog, March 2016
Eli Lilly and Company v Janssen Sciences Ireland UC (formally Janssen Alzheimer Immunotherapy), High Court of Justice of England and Wales, Patents Court (Rose J), London UK, 18 February 2016, Neutral Citation Number:  EWHC 313 (Pat)
On 18 February 2016, Rose J. refused Janssen’s application for a stay of the invalidity and declaration of non-infringement proceedings brought by Eli Lilly pending a decision of the EPO on the validity of Janssen’s patent in suit: divisional patent EP (UK) 2,305,282 (“the Patent”). Janssen claims the Patent will be infringed by Eli Lilly’s forthcoming product solanezumab, a monoclonal antibody for the treatment of Alzheimer’s disease.
In deciding to refuse the stay, the Court applied the guidance set down by the Court of Appeal in IPCom v HTC  EWCA Civ 1496 on stays in patent proceedings (see here), with the following points deemed particularly relevant in Rose J’s conclusion.
Timing of the Proceedings
EPO Opposition Division oral proceedings before for the Patent are scheduled for 22-23 June 2016. Janssen submitted that on this timeline, should the parties request acceleration of any appeal to the Technical Board of Appeal, a final oral decision from the EPO would be likely sometime between July and September 2017. Janssen estimated that a decision from the Patents Court would be at its earliest handed down in December 2016, with a decision on appeal unlikely to be handed down before July 2017 to September 2017.
Eli Lilly argued that the EPO timeline suggested by Janssen was improbable, and in any case the Technical Board of Appeal may remit points to the Opposition Division further delaying an ultimate decision.
Rose J decided on the facts that, given the early stage of the UK proceedings and the advanced stage of the EPO proceedings, it was likely that an EPO decision on the validity of the Patent, even at the appellate level, would be available before the conclusion of the UK proceedings and that this pointed in favour of a stay. Rose J also noted that Eli Lilly could have commenced the proceedings earlier.
Rose J accepted that, whilst the UK proceedings could reach an estimated total of £5 million in legal costs, this amount was insignificant when compared to the hundreds of millions of pounds already spent by both Eli Lilly and Janssen in developing products potentially falling under the scope of the Patent. Rose J also noted that Eli Lilly’s solanezumab is likely to be a blockbuster if it proves successful. Wasted costs did not therefore point in favour of a stay.
In support of its application, Janssen offered to undertake to do the following should a stay be granted: (i) to support the expedition of the EPO proceedings; (ii) not to seek an injunction for the duration of the Patent and any SPC that may be granted; and (iii) not to seek damages other than on a reasonable royalty basis, if validity was upheld.
However, Rose J accepted Eli Lilly’s submissions that even with the undertakings the degree of commercial uncertainty created by the grant of a stay was sufficient to override the factors in favour of a stay. In support of its position Eli Lilly argued that:
- notwithstanding any issues concerning the validity of the Patent, a declaration of non-infringement falls within the exclusive jurisdiction of the national courts and has the potential to provide Eli Lilly with commercial certainty surrounding its product;
- a decision from the Patents Court on the declaration of non-infringement in particular will assist Eli Lilly in deciding whether to submit its dossier for solanezumab in early 2017, or whether to wait. This is because if Eli Lilly’s solanezumab marketing authorization is granted before expiry of the Patent, Janssen may be able to obtain a SPC based on that marketing authorisation, resulting in an extension to the period of any royalties payable by Eli Lilly to Janssen (this was deemed by Rose J to be an important factor); and
- Janssen’s undertaking in respect of damages still left commercial uncertainty for Eli Lilly, as Janssen was not able to say what a reasonable royalty rate would be.
Other factors considered by Rose J, but given little weight, were that: (i) the stay would deprive Eli Lilly of an exportable judgment; and (ii) it was in the public interest to dispel any uncertainty surrounding the validity of the Patent.
Overall Rose J weighed the factors together and refused to grant the stay, citing the infringement issues as particularly important to this case.
The judgment is available here.