Following a reference from the Supreme Court of Austria to the European Court of Justice (ECJ), the Advocate General, in The Wellcome Foundation Ltd v Paranova Pharmazeutica Handels GmbH [2008] C-276/05, has addressed the question of the repackaging and parallel importation of pharmaceuticals. Advocate General Sharpston has concludes that the lawfulness of the new packaging in which drugs are marketed in another European Economic Area (EEA) State by a parallel importer is to be measured solely against whether it is capable of damaging the reputation of the trade mark and its proprietor. The Advocate General also attempts to shed further light on the extent of notification required to be given to trade mark owners by generic pharmaceutical companies in order for drugs to be legitimately repackaged and sold in this way.

BACKGROUND

Paranova had purchased branded Zovirax products sold by Wellcome in Greece, which were originally packaged in lots of 70 tablets. Since Austria requires that they be sold in packs of 60 tablets, Paranova repackaged the products in packs of 60 x 400 mg tablets. The new packaging differed from that of the original product in that: “Repackaged and imported by Paranova” was in bold type and block capitals across the front of the packaging; the manufacturer was referred to on the sides and on the back in normal type; and there was a blue band around the edges, which Paranova regularly uses for all of its pharmaceutical products.

Paranova duly informed Wellcome (which held the trade mark for Zovirax in Austria) of its intention to market Zovirax in Austria and enclosed colour prints of the outer packaging, of the blister packs and of the instructions for use. Wellcome requested that, in respect of future modifications, Paranova should, first, add a complete sample of every type of packaging and, second, disclose the state of export and the exact reasons for the repackaging. Paranova disclosed the reasons for the repackaging (different size of packaging), but not the state of export; it also refused to provide a sample unless Wellcome paid. Paranova was again asked to communicate the state of export and the precise reasons for the repackaging. Wellcome also objected to the aspects of the new packaging referred to above.

THE REFERENCE

Wellcome sought an injunction preventing Paranova from marketing Zovirax in packaging with those features and without having informed it of the State of export and the precise reasons for the repackaging. The dispute reached the Oberster Gerichtshof (Supreme Court) in Austria, which in turn sought further guidance from the ECJ.

In its first question, the Austrian Court asked whether Article 7 of the Trade Marks Directive (89/104/EEC) and the relevant ECJ case law required the parallel importer to prove that there would be artificial partitioning of the market by the trade mark owner seeking to enforce its trade mark rights. This was not only in relation to the repackaging in itself, but also as regards the presentation of the new packaging.

If the answer to this question was in the negative, the Austrian Court wanted to know whether the presentation of the new packaging should be measured against the principle of minimum intervention or (only) against whether it might damage the reputation of the trade mark and its proprietor. On the basis that the first question was answered in the negative by the ECJ in Boehringer Ingelheim KG v Swingward Ltd, the Advocate General was concerned only with the questions relating to “minimum intervention” and extent of notification.

THE QUESTIONS ANSWERED

In light of Boehringer and the ECJ’s decision in Bristol Myers- Squibb [1996] ECR I-3457, the Advocate General concluded that the questions referred should be answered as follows:

“Where a parallel importer of pharmaceutical products repackages the products in new packaging on the ground that repackaging is necessary in order to market the product in the Member State of importation, the lawfulness of the new packaging is to be measured solely against whether it is such as to damage the reputation of the trade mark and its proprietor.

In such circumstances, the parallel importer, in order to fulfil his duty of notification… must give the proprietor of the trade mark information which objectively demonstrates that the repackaging was necessary. Such information may, but need not necessarily, include identification of the Member State of export.”

COMMENT

This case should bring some clarity to what is in fact adequate disclosure or notification under Article 7 of the Trade Marks Directive. The prospect of the ECJ adopting the Advocate General’s answers will not, however, be welcomed by major drugs companies. Paranova was adamant that if it had been required to disclose every nuance of its repackaging regimen to Wellcome, there was a real possibility that the Austrian market would have been split. In addition, if a parallel importer were required to notify the trade mark owner of the State of export, the trade mark owner would be able to impose quotas on the supply of its pharmaceutical products to that State. This would then impede competition in direct contravention of European open market principles.