1 PATENT AND PHARMA UPDATE Our regular patent and pharma update aims to keep you informed of recent developments in United Kingdom and European law relating to patents and the pharmaceutical industry. 1. In Warner-Lambert's 'skinny label' infringement claim, the Patents Court refuses to enjoin generic but orders NHS to give guidance to prescribe by brand name Warner-Lambert Company, LLC v Actavis Group Ptc EHF & Ors  EWHC 72 (Pat), 21 January 2015;  EWHC 223 (Pat), 6 February 2015;  EWHC 249 (Pat), 6 February 2015; and  EWHC 485 (Pat), 2 March 2015 The ongoing dispute between Warner-Lambert and Actavis concerns developing law on how patents covering the second medical use of a pharmaceutical product can be infringed, and the role of health authorities in preventing such infringement. The patent in suit (EP (UK) No. 0 934 061) covers the second medical use of pregabalin for the treatment of neuropathic pain (sold by Warner-Lambert as Lyrica for all indications). Actavis sought to sell its generic pregabalin product with a 'skinny label' - the marketing approval sought was only for indications which were off-patent, without any reference the pain indication in the patient information leaflet. In a series of judgments, Arnold J in the Patents Court has: • refused to grant Warner-Lambert an interim injunction aimed at preventing pharmacists from dispensing Actavis' generic pregabalin 'off-label' for the patented use; • ordered NHS England to issue guidance to GPs and pharmacists to prescribe pregabalin for pain by the 'Lyrica' brand name, not the generic name; • allowed Warner-Lambert to amend its claim to allege that Actavis' subjective intention is that its generic pregabalin product be dispensed for the patented use; • rejected Warner-Lambert's claim that Actavis will indirectly infringe by supplying an essential means for infringement; and • denied Actavis' strike out and summary judgment applications. In an e-bulletin published 23 January 2015, we reported on the Patents Court's refusal to grant Warner-Lambert an interim injunction, despite evidence that off-label sales of Actavis' product were likely ( EWHC 72 (Pat)) (Read more). Warner-Lambert has appealed and the hearing is scheduled for April 2015. MARCH 2015 London Table of Contents 1. In Warner-Lambert's 'skinny label' infringement claim, the Patents Court refuses to enjoin generic but orders NHS to give guidance to prescribe by brand name 1 2. UK IPO decisions highlight the different approach to the computer program exclusion from patentability as compared to the EPO 2 3. Court of Justice clarifies availability of SPCs for combination products 3 4. BT granted disclosure of patentee's licence documents before damages inquiry begins 3 5. Court of Appeal upholds finding that Herceptin-related patent for dosing regimen invalid 4 6. Patents Court decides on Hospira v Genentech document confidentiality dispute 4 7. CJEU clarifies the operation of the 'Specific Mechanism' to restrict parallel importation of patented pharmaceuticals 5 8. Court of Appeal finds parallel importer's use of trade mark necessary to enable effective access to the market 6 9. CJEU upholds market exclusivity for orphan products with similar therapeutic indications 7 10.Patents Court refuses to reopen ZTE's patent infringement case on the basis of new-found prior art 7 11.Canon's printer cartridge patent infringement claim too complex for transfer to IPEC 8 12.IPEC refuses to grant summary judgment in claim for unjustified threats made based on a patent application 9 13.Key points from featured United Kingdom patent judgments 10 14.Key points from featured United Kingdom judgment on a pharmaceutical trade mark 12 15.Contacts 13 RELATED LINKS > Herbert Smith Freehills > The Unified Patent Court and the Unitary Patent 2 However since then Warner-Lambert has achieved a significant win in its campaign to prevent Actavis pregabalin being sold for pain. In the first judgment of this kind, Arnold J has ordered NHS England to issue a guidance note to GP practices and pharmacies that pregabalin should only be prescribed for the treatment of neuropathic pain under the brand name 'Lyrica', and not by the generic name 'pregabalin' ( EWHC 485 (Pat)). Arnold J held that the issuing of guidance by the NHS was 'the most efficacious, dissuasive and cheapest solution to the problem' , given that the only other alternative open to Warner-Lambert was to pursue interim injunction applications, which even if successful would impose a greater burden on the generic suppliers and a greater cost on the NHS. Arnold J was satisfied that the orders contained appropriate safeguards in that the NHS guidance will cease to apply if the patent is revoked or expires and Warner-Lambert has given cross-undertakings in damages to NHS England, along with the Department of Health, Actavis, Teva, and Dr Reddy’s (who have been joined as interested parties along with Consilient, Mylan, and Sandoz). As well as the issue of interim relief, there have been two further decisions in relation to Warner-Lambert's substantive claim. In February, each of the parties returned to the Court with an application following from the initial interim injunction judgment. In his subsequent judgment ( EWHC 223 (Pat)), Arnold J recognised that he may have been wrong to hold that the words 'for treating pain' in the patent claim imposed a requirement that Actavis must subjectively intend that its products will be used to treat pain in order for infringement to be established. His view was that this was a developing area of law, likely to be suitable for consideration by the Court of Appeal and the Supreme Court. These were compelling reasons for the case to go to trial and therefore Arnold J: • allowed Warner-Lambert's application to amend its claim to plead a case of subjective intention by Actavis; and • dismissed Actavis' application for a strike out of Warner-Lambert's claim and alternatively for summary judgment. In a further decision, Arnold J went on to decide that Warner-Lambert's claim that Actavis would indirectly infringe by supply of generic pregabalin (under section 60(2) of the Patents Act 1977) should not proceed to trial ( EWHC 249 (Pat)). Arnold J's view was that this allegation was 'simply hopeless' as it was premised on interpreting the Swiss form claim for the 'use of [pregabalin]… for the preparation of a pharmaceutical composition for treating pain' as a claim to the pregabalin product when the correct, settled approached was that Swiss form claims are process claims, directed at manufacture. 2. UK IPO decisions highlight the different approach to the computer program exclusion from patentability as compared to the EPO • Following on from our update on the Court of Appeal decision in Lantana v The Comptroller General of Patents, Design and Trade Marks  EWCA Civ 1463 (Read more), ten recent decisions of the UK IPO (between 8 October 2014 and 4 February 2015) have suggested that the UK IPO has a remarkably consistent approach to both the exclusion from patentability under section 1(2)(c) of the Patents Act 1977 for computer programs as such, and the case law of the European Patent Office (EPO) on this subject. • In seven out of the ten decisions the patent applications fell within this exclusion. Gene Onyx Limited BL O/435/14; Toshiba Research Limited BL O/453/14; and (with future amendment) Senergy Holdings Limited BL O/057/15 were the only applications which fell outside this exclusion. In the latter two decisions, the applicants relied on closely mapping the facts to those of particular leading cases. Given the limited sample size, rather than trying to draw conclusions as to the likelihood of surviving an excluded subject matter challenge, the more useful aspect of these decisions is the approach taken by the nine different hearing officers. In every decision, the hearing officer cites the Aerotel four-step test (Aerotel Ltd v Telco Holdings Ltd.  RPC 7), then mentions Symbian Ltd v Comptroller-General of Patents  RPC 1 before going on to the 'five signposts' (AT&T Knowledge Ventures LP Application  EWHC 343 (Pat) as qualified in HTC Europe Co Ltd. v Apple Inc  EWCA Civ 451). There is a consistent approach to all of these decisions. The Halliburton Energy Services Inc. v ComptrollerGeneral of Patents  EWHC 2508 (Pat) and Lantana cases are mentioned less frequently. Further, the applicants in each of these cases often sought to rely on the more permissive case law of the EPO. The failure of these attempts illustrates that hearing officers (like the Court of Appeal in Lantana) remain skeptical about the EPO approach. As for those decisions where the application succeeded, the Gene Onyx Limited BL O/435/14 decision concerned a method of using genetic analysis to assess the suitability of active ingredients in skincare and cosmetic products for use by an individual – subject matter which would not readily bring to mind the exclusion against computer programs 'as such'. In Toshiba Research Limited BL O/453/14, the applicant prevailed on the strong similarity of the facts to the EPO decision in Vicom: 'If image processing is patentable (as in Vicom) then speech processing is no more or less patentable.' In Senergy Holdings Limited BL O/057/15, the hearing officer accepted the similarity between a method of designing roller cone drill bits as in Halliburton and a method of optimising the design of a wellbore in the application (following future amendment). 3 3. Court of Justice clarifies availability of SPCs for combination products Actavis Group PTC EHF & Anor v Boehringer Ingelheim Pharma GmbH & Co (Judgment)  CJEU, C-577/13, 12 March 2015 • In response to questions referred by the English High Court, the Court of Justice of the European Union (CJEU) has clarified when a combination product may be entitled to a Supplementary Protection Certificate (SPC). The referral to the CJEU arose in the context of proceedings in the High Court between Actavis and Boehringer Ingelheim in relation to the validity of an SPC granted to Boehringer for its MicardisPlus product. MicardisPlus is a combination product containing telmisartan and hydrochlorothiazide as the active ingredients. Telmisartan is used for the treatment of hypertension while hydrochlorothiazade is a diuretic. Boehringer was the proprietor of a patent which disclosed and claimed numerous molecules, including telmisartan (EP (UK) 05002314). Boehringer received marketing authorisation on 16 December 1998 in relation to a first generation product known as Micardis, containing telmisartan as the sole active ingredient. Boehringer obtained an SPC for this active ingredient on 9 August 1999, with an expiry date of 10 December 2013 (First SPC). On 19 April 2002, Boehringer obtained marketing authorisation for the telmisartan / hydrochlorothiazade combination product, MicardisPlus and on 6 September 2002 it applied for an SPC in relation to this product (Second SPC). However, the UK IPO raised concerns that the patent only referred to telmisartan and not hydrochlorothiazade, and in order for an SPC to be granted in relation to a combination product, the combination must be clearly claimed in order to satisfy Regulation No 469/2009 (Regulation). In response, Boehringer applied to amend the patent to add a new claim relating to a pharmaceutical combination of telmisartan and hyrdochlorothiazade. The amendment was granted, and on 13 January 2006 the Second SPC was granted with an expiry date of 30 January 2017. Actavis commenced proceedings in the High Court challenging the grant of the Second SPC, on the basis that at the date of the application for the Second SPC, the product in question was not specified in the claims of the patent. The High Court referred a number of questions to the CJEU. In answering the questions referred, the CJEU held that Article 3(a) and (c) of the Regulation must be interpreted as meaning that, where a basic patent includes a claim to a product comprising an active ingredient which constitutes the sole subject-matter of the invention, for which the holder of that patent has already obtained an SPC, as well as a subsequent claim to a product comprising a combination of that active ingredient and another substance, that provision precludes the holder from obtaining a second supplementary protection certificate for that combination. 4. BT granted disclosure of patentee's licence documents before damages inquiry begins Adaptive Spectrum And Signal Alignment Inc v British Telecommunications Plc  EWHC 4447 (Pat), 19 December 2014 • Following an earlier finding that BT infringed Adaptive's patents, Birss J in the Patents Court has ordered Adaptive to provide BT with a list of licences and other agreements with Sky (Adaptive's sole UK licensee) in order for BT to understand the likely amount of damages it would have to pay in an inquiry as to damages, even though the inquiry had not yet begun. • BT was able to obtain early disclosure in relation to damages as the disclosure was likely to promote settlement, allow the parties to be on equal footing in any negotiations, and allow them to gauge the value of the case. • However Birss J refused to grant BT an order that Adaptive disclose documents relating to customers other than Sky at this stage as such an order would put Adaptive to considerable cost and trouble and would not be proportionate. In our January 2015 Patent and Pharma update, we reported on a series of judgments in which BT's Next Generation Access system, part of the Dynamic Line Management System responsible for controlling the operation of BT’s ADSL broadband services, was found to infringe Adaptive's patents EP (UK) Nos. 1 869 790 and 2 259 495 ( EWCA Civ 1462;  EWHC 4194) (Read more). Following those judgments, BT sought disclosure from Adaptive of licences and other agreements to facilitate BT's understanding of the damages it would have to pay. BT submitted that the disclosure would facilitate settlement discussions and assist BT in formulating a reasonable settlement offer under Part 36 of the Civil Procedure Rules. BT pointed out that it bore the onus of making a settlement offer early, given that under Part 36, if Adaptive recovered any sum on the damages inquiry, BT would be liable for costs incurred prior to BT making a settlement offer. It was therefore appropriate for the Court to order disclosure before the damages inquiry had begun. Birss J agreed that it is open to the Court to order disclosure going to quantum at an earlier stage than would ordinarily be done if it appears to be just and in accordance with the overriding objective, most commonly to promote settlement. Birss J agreed with Adaptive that the disclosure orders sought would cause Adaptive considerable difficulty, particularly in the timetable proposed by BT. Based on Adaptive's evidence, the disclosure sought would require Adaptive to produce highly confidential contracts, which would require detailed review and consideration. While Birss J accepted this, he also 4 found that the documents would be disclosable in the proceeding, the only question was when. In the present case there was one particular fact that led Birss J to order early disclosure: Adaptive had said in a press release that it would 'now proceed with its claim for damages, which it believes will amount to many millions of pounds'. For this reason, Birss J held that justice demanded that BT be entitled to early disclosure to assess whether Adaptive's publically-stated valuation was correct and the likely scale of damages. In considering the appropriate form of the orders, Birss J emphasised the need for the disclosure to be proportionate and the timetable to be realistic. On these bases, it was appropriate for Adaptive to list only its licenses with Sky, its sole UK licensee, and for the parties to discuss a reasonable timeframe. It was not necessary, as BT had sought, for Adaptive to disclose its licences with other customers at this stage or to produce a list of documents within five days of the hearing. 5. Court of Appeal upholds finding that Herceptin-related patent for dosing regimen invalid Hospira (UK) Ltd v Genentech, Inc  EWCA Civ 57, 6 February 2015 • In a further chapter in the litigation between Hospira and Genentech relating to breast cancer treatment drug Herceptin, the Court of Appeal has dismissed Genentech's appeal against a decision of Birss J in  EWHC 1094 (Pat) that its patent for a dosage regimen of trastuzumab was invalid for obviousness. • Trastuzumab is a monoclonal antibody and is the active pharmaceutical ingredient in Herceptin. The patent in suit in this proceeding was EP (UK) No. 1210115, which claimed an intravenous dosing regimen for trastuzumab of an initial loading dose of 8mg/kg, followed by at least two subsequent doses of 6mg/kg, administered at three weekly intervals. • Our January 2015 Patent and Pharma Update considered the decision in Hospira (UK) Ltd v Genentech, Inc  EWHC 3857 (Pat) in which the Patents Court rejected Genentech's proposed amendments to two patents relating to a formulation containing lyophilised trastuzumab and ordered the partial revocation of EP (UK) 1 516 628 and the entire revocation of EP (UK) 2 275 119 (Read more). Genentech's primary ground of appeal in this case focused on the rejection of particular evidence by Birss J, and the impact this was said to have on his conclusion that the claimed regimen was obvious. In the decision at first instance, Birss J accepted that, in light of information contained in the FDA label for the existing dosing regimen, the skilled clinician would identify the potential for a three-weekly regimen and that, based on evidence given by Hospira's expert in relation to 'Figure 1', the ordinary, skilled pharmacokineticist would support the conduct of a trial of a 500mg (7.14mg/kg) three-weekly regimen. However, at trial, Hospira also relied upon evidence given by its expert in relation to 'Figure 2', which sought to show that a minimum dose of 5mg/kg would be required to achieve the target concentration levels, resulting in a dosage window of between 5 and 8mg/kg. Birss J did not accept the Figure 2 evidence, but nevertheless still found the claimed regimen to be obvious, on the basis that once it was accepted that a pharmacokineticist would support a 500mg three-weekly trial, it would have been obvious to try lower doses, including the claimed dosage. On appeal, Genentech argued (among other things) that: • Hospira's case required acceptance of both the Figure 1 and Figure 2 reasoning in order for a finding of obviousness to be made. The consequence of the rejection of the Figure 2 reasoning was that Hospira had failed to prove its case. While Genentech accepted that, on the evidence, a three-weekly dosage regime using 7.14mg/kg (500mg) was worth trying, the evidence did not establish that it would have been obvious for the notional skilled team to try the claimed regimen with the necessary expectation of success; and • In the absence of evidence as to what the results of a three weekly 500mg trial would be, it was 'speculative to conclude that the skilled team would have sufficient success to proceed with trials of lower doses'. The Court of Appeal rejected Genentech's arguments and dismissed the appeal. The Court held that in this case, the criterion for determining whether the claim was obvious was 'whether the skilled team would consider the prospects of it working to be sufficiently good to warrant a small clinical trial'. It was not necessary for the team to arrive at the point where they would know that the regimen being tested would work. In light of this criterion, there was 'ample material' before the trial judge that allowed him to conclude that a range of doses, which included the claimed dosage regime, were obvious based solely on the Figure 1 evidence and the information from the FDA label. In those circumstances, the Court of Appeal concluded that it was not necessary for Birss J to determine the lower limit of that range, so long as the claimed dosage fell within it. 6. Patents Court decides on Hospira v Genentech document confidentiality dispute Hospira UK Ltd v Genentech, Inc  EWHC 3248 (Pat), 22 July 2014 (made available in February 2015) • Birss J in the Patents Court has ordered that some documents disclosed by Genentech in the course of proceedings against Hospira, which are of 'real interest' to other judicial bodies such as the European Patent Office (EPO) 'in order to fully understand what took place in the United Kingdom', are not to remain confidential. • The Court considered each document separately and balanced the public interest in disclosure against reasons put forward by Genentech for maintaining confidentiality. 5 • Parties must present clear and cogent reasons as to why confidentiality should be maintained for each relevant document. Generic or 'catch-all' arguments are unlikely to be sufficient to avoid public disclosure. • The decision illustrates the high level of scrutiny an English court will engage in before making confidentiality orders under Civil Procedure Rules (CPR) rule 31.22, in light of the importance of open justice. Such orders are fact-specific and will turn on whether a party is able to show on a document-by-document basis that the balance weighs in favour of maintaining confidentiality. During the course of earlier proceedings between Genentech and Hospira regarding the validity of certain of Genentech's patents relating to the breast cancer drug Herceptin (trastuzumab) ( EWHC 1094 (Pat)), Genentech had disclosed a number of documents in support of its patents, some of which it claimed were confidential. Genentech applied for an order under CPR 31.22 that certain of those documents remain confidential. Although Birss J decided this application in July 2014, the decision was published only in February 2015. CPR 31.22(1) states that a document that has been disclosed during the course of court proceedings can be used only for the purpose of those proceedings. However, there are exceptions to this rule, including if the document has been read or referred to by the court at a hearing held in public or the court gives permission for such use. Under CPR 31.22(2), the court may, on application by a party, order that confidentiality in the document be maintained. All of the six documents in issue in this application had been read or referred to during the trial. The Court identified a number of principles relevant to the application (relying on Lilly Icos v Pfizer (No 2)  EWCA Civ 2). These principles included that 'very good reasons' were required for departing from 'the normal rule' of publicity of documents disclosed in court, and that simple assertions of confidentiality and of the damage that would arise from disclosure would not be sufficient. In reaching its decision, the Court must balance the need for the public to be properly informed in the interests of justice against the need for parties to be able to litigate their cases without restraint arising from fear of publicity. Genentech advanced two general arguments in relation to all of the documents in issue. First, it argued that disclosure of these documents would reveal how Genentech conducted its dealings with regulators, and second, that the parts of the documents quoted in the expert reports were sufficient to enable the public to understand the proceedings. The Court rejected both of these arguments, finding the first 'catch all' argument simply insufficient, and noting in relation to the second the difference between disclosing a quote from a document and seeing the underlying document in its entirety. The Court then considered each document individually in light of the reasons advanced by Genentech in support of maintaining confidentiality, with mixed results: • Two documents, characterised as blueprints for clinical trials, were maintained as confidential as the Court considered that there was no reason why the documents needed to be disclosed to the public. • One page of an extract of Genentech's biologics licence application was required to be made public as it contained information referred to by the experts. However, the Court held the remainder of the documents in this category was to remain confidential. • A letter from Genentech to the FDA was required by the Court to be made public. The Court held that a 'reasonable observer' at trial would have wished to see the document in order to understand the way the trial had gone. The Court also noted that the EPO would have a 'real interest' in seeing this document in proceedings relating to the same patent. • A document containing dosage regimen analyses (the subject matter of one of the patents in suit), was ordered to be made public, also on the basis that a 'reasonable observer' at trial would have wished to understand this document in order to understand the proceedings. 7. CJEU clarifies the operation of the 'Specific Mechanism' to restrict parallel importation of patented pharmaceuticals Merck Canada and Merck Sharp & Dohme (Judgment)  CJEU, C-539/13, 12 February 2015 • The Court of Justice of the European Union (CJEU) has clarified the conditions that must be satisfied before the holder of a patent or supplementary protection certificate (SPC) for a pharmaceutical product can bring infringement proceedings against a parallel importer under the Specific Mechanism (in Chapter 2 of Annex IV to the 2003 Act of Accession to the European Union). • The patent or SPC holder, or beneficiary, is not required to give notice of its intention to oppose the parallel importation in order to rely on the Specific Mechanism. However, if the right holder delays indicating its intention to oppose importation, it cannot rely on the Specific Mechanism with regard to importation carried out before it gave notice of its intention to oppose. Therefore in practice, a patent or SPC holder, or beneficiary, should give such notice within one month of receiving notice of the intention to parallel import, so that the patent or SPC holder, or beneficiary, can claim relief in respect of the full period of any subsequent parallel importation. • While the patent or SPC holder, or beneficiary, must directly be given one month's notice of the intention to parallel import the pharmaceutical product, this notice does not need to come from the person proposing to parallel import, but must clearly identify them. 6 • The CJEU's judgment differs from the opinion of the Advocate General, which provided that in order to rely on the Specific Mechanism, a patent or SPC holder must demonstrate an intention to do so within one month of receiving notification of another party's plan to parallel import those products (see our November 2014 Patent and Pharma Update: Read more). • The CJEU reinforced the Advocate General's observation that the Specific Mechanism seeks to achieve a balance between effective protection of patent and SPC rights and the free movement of goods in the European Union. The Specific Mechanism allows the holder or beneficiaries of a patent or SPC for a pharmaceutical product in particular European countries, including the UK, to prevent import and marketing of the product in that country if the product was sourced from new Member States (Czech Republic, Estonia, Latvia, Lithuania, Hungary, Poland, Slovenia and Slovakia) where equivalent patent rights could not be obtained at the time the patent or SPC was granted. This allows patent and SPC holders to bring infringement proceedings even if the patented product was put on the market in that new Member State with his consent, so that the patent or SPC rights would otherwise be exhausted. Where a patent or SPC holder seeks to rely on the Specific Mechanism, a party proposing to parallel import must demonstrate to the relevant authorities that one month’s prior notification has been given to the patent or SPC holder, or to a beneficiary. In the present case, Merck owned EP (UK) No. 0 480 717 and an SPC for montelukast sodium, the active ingredient in its Singulair product for treatment of asthma. Pharma XL, an associated company of Sigma, gave notice to MSD BV, a company in the Merck group, that it intended to import Singular from Poland to the UK. Merck did not express any objection and Sigma began importing and selling repackaged Singulair in the UK. Merck and MSD, who by that time was the exclusive licensee of the patent and SPC, then sued Sigma for patent infringement, relying on the Specific Mechanism. Sigma argued that Merck could not rely on the Specific Mechanism as it had not demonstrated an intention to do so, whereas Merck and MSD submitted that the protection under the Specific Mechanism is automatically applicable. The English Court of Appeal referred a number of questions to the CJEU regarding the requirements for the notification of the parallel importation and the necessary response by the rights holder, in response to which the CJEU held that: 1 The Specific Mechanism does not require the holder of a patent or SPC, or a beneficiary, to give notice of his intention to oppose a proposed parallel importation before invoking his rights under the Specific Mechanism. 2 However the holder, or beneficiary, cannot rely on the Specific Mechanism with regard to importation and marketing of the pharmaceutical product carried out before such an intention was indicated. 3 Any person can give the patent or SPC holder, or beneficiary, notice of the intention to parallel import the pharmaceutical product, provided that it is possible from the notification to clearly identify the parallel importer. 4 Notice of the intention to parallel import must be given directly to the patent or SPC holder, or beneficiary, and the beneficiary is any person who enjoys the rights conferred by law on the patent or SPC holder. 8. Court of Appeal finds parallel importer's use of trade mark necessary to enable effective access to the market Speciality European Pharma Ltd v Doncaster Pharmaceuticals Group Ltd & Anor  EWCA Civ 54, 6 February 2015 • The Court of Appeal has found that if Doncaster could not use Madaus' REGURIN trade mark to oversticker its parallel imported pharmaceutical products, Doncaster's access to the portion of the market represented by prescriptions where the brand name was specified would be hindered. As such, Doncaster was not liable for infringement of the REGURIN trade mark in the UK. • This case illustrates the power of the so called 'Euro defences' in the Treaty on the Functioning of the European Union (TFEU) to protect parallel importers from trade mark infringement allegations where use of a trade mark is necessary to enable effective access to the market. Madaus manufactures trospium chloride for the treatment of over-active bladder symptoms. Its products are sold in a number of European Union countries under various trade marks owned by Madaus, including REGURIN in the UK and CÉRIS in France and URIVESC in Germany. Speciality is the exclusive UK licensee of the REGURIN trade mark and distributes the product in the UK. Doncaster is a parallel importer of pharmaceutical products and sells Madaus product in the UK which it imports from France and Germany. Prior to 2009, Doncaster had been overstickering the trade marks on the Madaus product it imported into the UK with the name of the active ingredient. In 2009 the patent for trospium chloride expired and Doncaster began to oversticker its imports with the REGURIN trade mark. As a result of this rebranding, Speciality sued Doncaster for trade mark infringement. The issue in the proceeding was whether Doncaster's overstickering of imported product with the REGURIN trade mark was necessary for Doncaster to have effective access to the UK market. If it was necessary, it would engage the free movement provisions of the TFEU, the so called 'Euro defences' to trade mark infringement. At first instance, the High Court held that there was no objective necessity to use the REGURIN trade mark, rather Doncaster was using REGURIN in an attempt to 'piggy back' on Speciality's marketing efforts and investment. The Court of Appeal reversed the trial judge's finding, holding that Doncaster's use of REGURIN went no further than what was necessary to overcome artificial barriers to effective market access. There was a substantial part of the market, namely the portion of the market represented by prescriptions where the brand name REGURIN was specified, to which Doncaster 7 did not have effective access without using the trade mark, particularly given that UK practice prevents pharmacists from dispensing generic products where the prescription specifies the brand name. Further, the Court of Appeal accepted the evidence of Doncaster that it was not realistic for Doncaster to invest in an own brand because of the supply issues which affect parallel importers. The Court of Appeal noted that given the instability of Doncaster's supply line it 'would be verging on the irresponsible to encourage a doctor to prescribe a Doncaster brand'. The Court of Appeal's decision upholding Doncaster's 'Euro defences' and overturning the finding of trade mark infringement is encouraging news to parallel importers such as Doncaster, who oversticker their parallel imported products with UK trade marks. 9. CJEU upholds market exclusivity for orphan products with similar therapeutic indications Teva Pharma BV, Teva Pharmaceuticals Europe BV v European Medicines Agency (EMA) supported by European Commission (Judgment)  CJEU, T-140/12, 22 January 2015 • A medicinal product may be designated as an orphan product even if a treatment exists for the condition in question, provided that it represents a significant benefit to those already affected by the condition. • The Court of Justice of the European Union (CJEU) held that market exclusivity must be granted in all cases in which an orphan product has been given marketing authorisation. This is consistent with the objective of the orphan product Regulation No 141/2000 (Regulation) and to hold otherwise would run counter to the spirit of the Regulation. • The fact that therapeutic indications for which two orphan products have been granted marketing authorisations are similar, cannot undermine the market exclusivity enjoyed by those products. On 14 February 2001, the medicinal product imatinib melysate (imatinib) was designated as an orphaned medicinal product for the treatment of chronic myeloid leukemia (CML). A marketing authorisation for imatinib was granted to Novartis on 7 November 2001 under the commercial name Glivec. The market exclusivity enjoyed by Glivec under Article 8 of the Regulation was 10 years, expiring on 12 November 2011. On 2 February 2006 Novartis submitted an application to the European Medicines Agency (EMA) for designation of a new orphan medicinal product for the treatment of CML, called nilotinib. Nilotinib was successfully designated as an orphan medicinal product on 5 April 2006 and given the commercial name Tasigna. Because imatinib and nilotinib were similar products for the same therapeutic indications, it was required by the Regulation that consent to be given for the authorisation of Tasigna by the holder of the authorisation for Glivec (the same company, Novartis). Authorisation was, unsurprisingly, given. On 5 January 2012, Teva applied for authorisation to place onto the market a generic version of Glivec, called imatinib Ratiopharm. The EMA refused this application in so far as it covered CML therapeutic indications for which Tasigna held a marketing authorisation, on the ground that such authorisations were still subject to market exclusivity under Article 8(1) of the Regulation. Teva appealed the EMA's decision to the CJEU, arguing i) that the EMA misinterpreted Articles 8(1) and (3) of the Regulation when granting a second authorisation to nilotinib, as a similar second generation product for the same indication was not entitled to a new period of market exclusivity. To find otherwise would be to effectively grant imatinib an additional period of marketing exclusivity (and which could encourage 'evergreening'); and ii) that there was infringement of Article 3(1)(b) of the Regulation, as nilotinib did not satisfy the conditions for an orphan medicinal product when its marketing authorisation was granted. The CJEU in finding against Teva held that the assessment of significant benefit must take place by comparison with an existing authorised medicinal product and cannot be limited to an assessment of the intrinsic qualities of the product in question. The criteria for finding a significant benefit are strict, requiring investment in research and development. In this case it was irrelevant that the same company held both marketing authorisations. The fact that the therapeutic indications for which both orphan medicinal products received marketing authorisation are similar cannot undermine the market exclusivity enjoyed by each of the medicinal products for those therapeutic indications. 10. Patents Court refuses to reopen ZTE's patent infringement case on the basis of new-found prior art Vringo Infrastructure Inc v ZTE (UK) Ltd  EWHC 214 (Pat), 30 January 2015 • Birss J in the Patents Court has refused ZTE's application to reopen a patent trial to plead new prior art against the validity of Vringo's patent. • Although the Court does have the power to reopen a trial to review new prior art following judgment, in this case it was not appropriate as ZTE's application could and should have been made before trial. • To allow the prior art to be admitted at this stage would have serious consequences on the finality of the decision, impact other users of the Court, and incur significant time and costs. Following a six day trial, Birss J had found that Vringo's patent EP (UK) No. 1 212 919, concerning relocation of a protocol termination point in a mobile phone system, was valid and infringed ( EWHC 3924 (Pat)). However, before the order 8 was sealed, ZTE applied to reopen the trial on the basis of new prior art which ZTE claimed disclosed 'protocol transparency', a key feature of the invention which Birss J had found was not disclosed in the prior art cited at trial. Birss J refused ZTE's application, finding that although the Court had the power to reopen the trial, the starting point for whether the Court should do so was the overriding objective in the Civil Procedure Rules to deal with cases justly and at proportionate cost. Here, ZTE was seeking to advance a new case based on a new piece of prior art which ZTE could have readily found before the trial based on an expert report filed by Vringo. Birss J noted that a key characteristic of the case was that the prior art originally relied on was ZTE's free choice and ZTE would have known that it had to 'make a careful selection'. ZTE had not justified why the application to rely on new prior art had arisen only after the trial and it was not clear why ZTE had not looked for the prior art earlier. Birss J concluded that there was 'simply no good reason why the court and third parties should be inconvenienced in any way' as a result of ZTE's failure to do so. To allow the application would have serious consequences for resources and finality, impact other users of the Court, and incur significant time and cost, particularly given that further witnesses would need to be cross-examined. Birss J accepted ZTE's submissions that third parties in the industry would be affected by the outcome as that the patent was a standard essential patent, that the case was only about money as Vringo had undertaken to offer licences on a FRAND basis, that neither side had yet acted to its detriment based on the judgment so to some extent any reopening or reversal of the judgment could be compensated in costs, and there would be no major prejudice to Vringo. However these were merely factors in favour of ZTE's application. The key issues were finality and the nature of the new evidence, which favoured refusal of the application. Birss J was not satisfied that ZTE's invalidity case based on the new prior art was so strong that he would be 'leaving a patent on the register which… is probably invalid', however had ZTE's case been that strong Birss J stated that this might be a weightier factor in favour of the application, given the possible impact of the validity judgment on third parties. 11. Canon's printer cartridge patent infringement claim too complex for transfer to IPEC Canon Kabushiki Kaisha v Badger Office Supplies Ltd & Ors (2015) Ch D, 6 February 2015 • Arnold J in the High Court (Patents Court) has refused the defendants application to transfer Canon's patent infringement claim to the Intellectual Property Enterprise Court (IPEC). • While the relative size of the corporate parties and the value of the infringement claim are important factors in deciding whether to transfer a proceeding, these factors may not be determinative. • Where the parties have raised relatively complex issues for determination, that complexity may make the case unsuitable for hearing in the IPEC, given that trials before the IPEC are limited to two days. • Where the High Court refuses an application for transfer to the IPEC, it may still seek to ensure that the proceedings are conducted in a proportionate fashion in the High Court, and engage in active case management and cost management to ensure this is the case. Canon commenced proceedings in the Patents Court division of the High Court against three defendants for the alleged infringement of one of Canon's patents. The patent in suit is EP (UK) No. 2 087 407, which relates to a coupling member component of a drum unit for use in printer cartridges. All three of the defendants applied to the Patents Court to have the proceedings transferred to the IPEC. In considering the application, Arnold J noted that the principles to be applied were well established, and were set out in Civil Procedure Rules (CPR) rule 30.5 (as modified by CPR rule 63.18 and paragraphs 9.1 and 9.2 of PD30). These required consideration of each of the following factors: • Financial position and nature of the parties: Canon was a large undertaking with very substantial sales, whereas each of the defendants was a small to medium enterprise making a modest profit. • Value of the claim: The defendants claimed a profit from the alleged infringing products of £141,733, and argued that the likely costs of High Court proceedings would be disproportionate to this value. On the other hand, Canon argued that the patent protected sales of products worth €70million each year and given it has a further 12 years to run, the value of the claim to Canon was significantly higher, and well over the £1million upper threshold set out in the IPEC Guide. • Complexity of the case: While the technical complexity of the case was low, the defendants sought to raise a number of complex issues, including issues of validity. In addition, one of the defendants also challenged infringement on the basis that it purchased 'remanufactured' drums from a third party located in China, and the remanufacturing process carried out by that party was a legitimate 'repair' of the product rather than an infringement by 'making' the patented product. Arnold J noted that this issue required consideration of a multifactorial test, giving rise to a number of factual inquiries, made more complicated given the remanufacturing process was carried out by a third party. Ultimately, the judge refused the application, with the result that the proceedings will continue in the High Court. In reaching his decision, Arnold J observed that it was 'finely balanced' and that he 'had a great deal of sympathy with both sides' position'. Crucial to the decision was the complexity of the issues raised, which the judge considered rendered the case inappropriate for a trial within the IPEC, given the two day hearing limit in that court. It was not a complete loss of the defendants however. In response to the 'real concerns' raised by the defendants, Arnold J indicated that the Court would apply active case and cost management to the proceedings, to ensure that it was conducted 9 in a proportionate manner. In a salient warning to parties and practitioners in future cases, the judge cautioned that 'just because a case proceeds in the High Court, it does not follow that the parties are given free rein to raise whatever issues they like and to spend whatever money they like litigating those issues'. 12. IPEC refuses to grant summary judgment in claim for unjustified threats made based on a patent application Global Flood Defence Systems & Anor v Van den Noort Innovations BV & Ors  EWHC 153 (IPEC), 29 January 2015 • The Intellectual Property Enterprise Court (IPEC) has confirmed that in an action for unjustified threats of proceedings for infringement of a patent application (as opposed to a granted patent), a defendant may seek to rely on the defence of justification contained in section 70(2A) of the Patents Act 1977. However, in order to do so, the patent must have proceeded to grant before the trial occurs. • In order to avoid summary judgment in the context of such proceedings, the party seeking to rely on the defence will therefore need to establish that there is a real prospect the patent will be granted before the date of the trial. • The Court also emphasised that where the justification defence is relied upon, the burden is on the defendant to prove that the threats were justified in the sense that the acts giving rise to the threats constituted (or if done, would constitute) an infringement of the patent. The first defendant, VDN, was the proprietor of European Patent Application 2 315 880 relating to flood barriers, which designated the UK. VDN had placed three notices on its website and written to a member of parliament alleging that Global Flood was infringing its patent. In response to these threats, Global Flood commenced proceedings for unjustified threats under section 70(1) of the Patents Act 1977. This decision of the IPEC relates to Global Flood's application for summary judgment on the basis that, among other things, there was no evidence that the patent would be granted before trial and as a result, VDN's defence of justification under section 70(2A) could not succeed. In considering the application for summary judgment, HHJ Hacon confirmed that the defence of justification contained in section 70(2A) may be relied upon where the threat relates to a patent application, in light of a proper reading of the legislative scheme. It was relevant that section 69 of the Act confers retrospective effect on a patent application, in the sense that it provides a contingent right to claim relief in respect of acts of infringement committed after publication of the application, but before grant. The right to sue a party for threating infringement proceedings is provided by section 70(1). Although this section refers to threats of proceedings for infringement of a 'patent', the Court of Appeal (in Patrick John Brain v Ingledew Brown Bennison & Garrett  FSR 341) has previously held that this is not to be interpreted literally, as otherwise the section would provide no right to sue for threats of infringement proceedings arising from a published patent application under section 69. As a result, section 70(1) also applies in respect of threats to sue for infringement of a patent application, as such a threat would be understood as a threat to bring proceedings once the patent is granted. HHJ Hacon held that it followed that if an unjustified threats action can be brought under section 70(1) in relation to a patent application, the defence under section 70(2A) must also be available. That section provides a defence where the person who made the alleged threat can establish (among other things) that the acts in respect of which the threats were made constitute, or would constitute, infringement. Having decided that the section 70(2A) defence was theoretically available to VDN, HHJ Hacon then considered whether VDN's defence under section 70(2A) lacked reality such that summary judgment should be granted. Ultimately, HHJ Hacon declined to grant summary judgment. In particular, HHJ Hacon held that although minimal, the evidence adduced by VDN was sufficient to establish that there was a real prospect that the patent would be granted before the trial date. Further, HHJ Hacon held that although VDN's threats were not contingent on the patent being granted (but rather suggested that proceedings had been, or would imminently be, commenced for infringement of a granted patent), this did not mean that VDN could not establish the section 70(2A) defence. This was because this defence required VDN to prove that the acts in respect of which proceedings were threatened constituted (or would constitute) infringement of a patent, not that it was able to make good its threats. 10 13. Key points from featured United Kingdom patent judgments Patentee(s) / patent no. Other party/ies Product Court Judge Legal issue Outcome Decisions related to pharmaceutical patents Warner-Lambert Company, LLC EP (UK) No. 0 934 061 Defendants: Actavis Group Ptc EHF, Actavis Group PTC EHF, Caduceus Pharma Limited Proposed defendant: Highland Health Board LYRICA (pregabalin marketed to treat epilepsy, anxiety disorder, and neuropathic pain) Patents Court Arnold J Whether Warner-Lambert should be granted an interim injunction aimed to prevent dispensing of Actavis' generic product for the claimed use, to treat neuropathic pain. Interim injunction refused. Whether Actavis should be granted summary judgment or strike out. Whether Warner-Lambert should be allowed to amend its pleadings to claim that Actavis' subjective intention was that its generic pregabalin be used to treat pain. Actavis' applications for summary judgment and strike out of pleadings denied. Warner-Lambert allowed to amend pleadings to claim that Actavis' subjective intention was that its generic pregabalin be used to treat pain. Whether Warner-Lambert's claim (under s 60(2)) that Actavis infringed by supply should proceed to trial. Warner-Lambert's claim of infringement by supply not allowed to proceed to trial. Defendants: as above Respondent: National Health Service Commissioning Board Interested parties: Teva UK Limited, Generics (UK) Limited t/a Mylan, Dr Reddy's Laboratories (UK) Limited, Consilient Health Limited, Sandoz Limited, Department of Health Whether NHS England should be ordered to issue a guidance note to GP practices and pharmacies regarding prescribing of pregabalin. NHS England ordered to issue a guidance note to GP practices and pharmacies that in general pregabalin should only be prescribed for the treatment of neuropathic pain under the brand name Lyrica, and not under the generic name pregabalin or any other generic brand. 11 Patentee(s) / patent no. Other party/ies Product Court Judge Legal issue Outcome Genentech, Inc EP (UK) No. 1 210 115 Hospira (UK) Limited HERCEPTIN (trastuzumab to treat breast cancer) Court of Appeal Elias, Kitchin, Floyd LJJ Whether to allow Genentech's appeal from the decision of Birss J that the EP '115 patent was invalid for obviousness, or alternatively for insufficiency (and other grounds of invalidity arising from loss of priority date). Genetech's appeal dismissed. EP '115 patent invalid. Genentech, Inc EP (UK) Nos. 1 210 115 and 1 308 455 Hospira UK Limited HERCEPTIN (trastuzumab to treat breast cancer) Patents Court Birss J Whether to allow Genentech's application under CPR 31.22 to maintain confidentiality over six documents which were disclosed during the proceedings, following the substantive judgment. Application granted in part: two documents and one page of another document ordered to be kept confidential. Remainder of documents publicly disclosed and used in other proceedings. Decisions related to patents other than pharmaceutical patents Adaptive Spectrum And Signal Alignment Inc EP (UK) Nos. 1 869 790 and 2 259 495 British Telecommunications Plc Methods for managing ADSL technology, which sends data over telephone lines Patents Court Birss J Whether BT, who had been found to infringe in an earlier judgment, should be granted disclosure of licence documents from Adaptive to allow BT to assess the likely damages before the damages inquiry had begun. Adaptive ordered to disclose licence documents with one customer only at this stage, and within a longer time period than sought by BT. Vringo Infrastructure Inc EP (UK) No. 1 212 919 ZTE (UK) Ltd Technology for relocating a protocol termination point in a mobile phone system Patents Court Birss J Whether ZTE should be permitted to rely on new prior art after a judgment that the patent was valid and infringed had been delivered, but the orders had not yet been sealed. ZTE was not allowed to rely on the new prior art as it could and should have introduced the prior art before trial. Canon Kabushiki Kaisha EP (UK) No. 2 087 407 Badger Office Supplies Limited, Inkjet Direct Limited, Greentrees International Limited Coupling member for electrophotographic photosensitive drum unit for printer cartridges Patents Court Arnold J Whether to transfer the proceedings for patent infringement to the Intellectual Property Enterprise Court. Application for transfer dismissed – complexity of the issues raised meant that the case was unsuitable for hearing in the IPEC. 12 Patentee(s) / patent no. Other party/ies Product Court Judge Legal issue Outcome Van den Noort Innovations BV, Johann HR Van den Noort, Flood Control International Limited EP Application No. 2 315 880 Global Flood Defence Systems & UK Flood Barriers Limited Flood defence device known at the 'self closing flood barrier' IPEC HHJ Hacon Whether the court should allow Global Flood's application for summary judgment in relation to its allegation of unjustified threats of patent infringement proceedings on the basis that the patent had not yet been granted. Global Flood's application for summary judgment was dismissed. 14. Key points from featured United Kingdom judgment on a pharmaceutical trade mark Trade mark owner (second defendant) Exclusive licensee (claimant) Parallel importer (first defendant) Trade mark and product Court Judges Legal issue Outcome Madaus GmbH Speciality European Pharma Limited Doncaster Pharmaceuticals Group REGURIN (trospium chloride, for the treatment of over-active bladder) The same product is marketed in France under the trade mark CÉRIS, and in Germany under the trade mark URIVESC Court of Appeal Arden, Floyd, Bean LJJ Whether Doncaster could rely on the 'Euro defences' to avoid trade mark infringement where it was parallel importing product bearing the trade marks registered in other jurisdictions and overstickering with the UK REGURIN trade mark. Doncaster was not liable for trade mark infringement as it was necessary for Doncaster to oversticker with the REGURIN trade mark in order to have effective access to the UK market. 13 15. Contacts Rosie Patterson (Senior Associate, London) T +44 20 7466 2448 [email protected] Anna Vandervliet (Senior Associate, Australia) T +44 20 7466 2842 [email protected] Grace Pead (Associate, Australia) T +44 20 7466 7518 [email protected] If you would like to receive more copies of this briefing, or would like to receive Herbert Smith Freehills briefings from other practice areas, or would like to be taken off the distribution lists for such briefings, please email [email protected] © Herbert Smith Freehills LLP 2015 The contents of this publication, current at the date of publication set out above, are for reference purposes only. They do not constitute legal advice and should not be relied upon as such. Specific legal advice about your specific circumstances should always be sought separately before taking any action based on the information provided herein.