Yesterday the Patents Court handed down its decision in Merck Sharp Dohme Corp and Bristol-Myers Squibb Pharmaceuticals Limited v Teva Pharma BV and another [2013] 1958 (Pat). The case concerned whether it was right for the claimants to have started proceedings for a final injunction based on threatened acts of infringement in circumstances where the defendant had failed to provide the claimants with information as to its intentions in relation to the launch of a generic pharmaceutical product.

Business impact

This is an important decision for patentees when using pre-action correspondence to ascertain whether a company intends to launch its generic pharmaceutical at risk. The decision from Mr Justice Birss provides some useful guidance as to the subjective and objective factors that the court will consider when deciding whether a threat to infringe has been made out.

Background

In February 2012, Merck Sharp & Dohme and Bristol-Myers Squibb (together referred to as "BMS") brought proceedings in the High Court against Teva for infringement of a European patent and supplementary protection certificate relating to efavirenz, a non-nucleoside reverse transcriptase inhibitor used in the control of HIV infections. The patent was due to expire on 3 August 2013, and the SPC on 19 November 2013.

BMS based its claim on, what it alleged, were acts demonstrating that Teva intended to infringe the patent and SPC by launching a generic efavirenz product at risk in the UK. BMS' evidence was centred on (i) a positive opinion on the grant of a marketing authorisation by the Committee for Medicinal Products for Human Use, (ii) the grant of a marketing authorisation to Teva by the European Medicines Agency, and (iii) the refusal by Teva in correspondence to provide details of its intentions regarding the launch of generic efavirenz in the UK – Teva stated that its intentions were confidential:

"It is not Teva's policy to disclose to its competitors information relating to the date on which any product the subject of a Marketing Authorisation will be launched in any given country. This is regarded by Teva, and we believe by all our competitors, as being confidential information."

At the same time as commencing the proceedings, BMS also issued an application for an interim injunction to prevent Teva from launching generic efavirenz pending trial. In March 2012, HHJ Birss QC (as he then was) granted the interim injunction. A copy of his judgment is here. In summary, the Judge thought that Teva's silence on the question of its intentions was sufficient to indicate that Teva was not prepared to commit to waiting until the proceedings had been completed before launching a generic efavirenz product: "If they were prepared to wait until the proceedings are over, they could readily have said so."

The issues at trial

Following the grant of the interim injunction, there was only one issue at trial for consideration by Mr Justice Birss – were Teva's actions sufficient to demonstrate an intention to infringe and hence should a final injunction be available to permanently restrain Teva from launching a generic efavirenz product whilst the patent and SPC were in force? Note that Teva did not dispute points of technical non-infringement (i.e. whether its product fell within the scope of the patent and SPC), or challenge the validity of the patent or SPC.

Teva argued that, at the relevant date – the commencement of the UK proceedings by BMS in February 2012 – it did not in fact have any intention to launch generic efavirenz before expiry of the SPC, and that the claim by BMS should therefore fail. In its defence, Teva adduced evidence from both its legal and commercial functions in order to try to prove to the Court that Teva never had an intention to launch generic efavirenz in the UK before expiry of the SPC. In particular, Teva argued that its own internal "Preliminary Limiting Marketing Date" (i.e. the date before which the product could not be launched for legal reasons) for generic efavirenz was the same date as expiry of the SPC.

The legal principles

Under English law, a patentee can ask the court for an injunction to be granted before an infringing act has been committed in order to stop it taking place. This is known as a quia timet injunction. However, in order to obtain such relief, the patentee must prove that what is being threatened is imminent, albeit that the degree of probability of future injury is not an absolute standard.

The Judge in this case reviewed the previous jurisprudence on quia timet injunctions and distilled the issues to a single question that the court should address: whether, viewed in all the relevant circumstances, there was a sufficiently strong probability that an injunction would be required to prevent the harm to the claimant to justify bringing the proceedings? In other words, to justify coming to court requires there to be a concrete, strong and tangible risk that an injunction is required in order to do justice in all the circumstances.

Mr Justice Birss also considered how to test that proposition, finding that the court should not only take account of the defendant's subjective intentions, but that also a defendant's overt acts must be capable of being relevant.

The Court's decision

Applying the law and carrying out a subjective and objective assessment of Teva's acts and intentions, Mr Justice Birss held that the probability that an injunction would be required to prevent Teva from infringing was sufficiently strong to justify the legal proceedings brought by BMS. The Judge highlighted the following factors as relevant to his decision: 

  • The UK market was large, and therefore a generic company which was prepared to take the infringement risk would have a real commercial incentive to do so by launching first and alone as the first generic on the market. The Judge thought that the type of generic product (i.e. a retail product supplied to pharmacies, or a hospital supplied product) made no difference to the commercial incentive.
  • Teva was a large, successful supplier of generic products and it had, in the past, shown that it was demonstrably prepared to launch products without notice and with the risk of patent infringement (e.g. with the launch of atorvastatin in June 2011). In addition, the Judge found that Teva was prepared to launch surreptitiously if it chose to do so.
  • Teva had received a favourable opinion for its efavirenz product from the Committee for Medicinal Products for Human Use, and subsequently obtained a marketing authorisation. This showed that Teva had an intention to launch efavirenz at some point, although not necessarily prior to expiry of the SPC or patent. However, the Judge thought that having a marketing authorisation in place two years before expiry made an at-risk launch feasible from a regulatory position.
  • Teva's long-term strategy position was for a launch date after expiry of the patent and SPC. However, the Judge found from the evidence that the possibility of launching in the UK before expiry was under active consideration as a result of the timing of the opinion from the Committee for Medicinal Products for Human Use. Therefore, for Teva an earlier launch made sense commercially and practically.
  • Teva's statement later in the proceedings that it had no intention of launching should not carry the same weight as a similar statement provided before the proceedings were issued. This was because, by that point, the claim had been started, an interim injunction had been granted and Teva had already refused to provide its position in correspondence (and before the Court at the interim injunction hearing).
  • Characterising Teva's intentions as no more than an absence of plans to launch efavirenz before expiry of the patent or SPC would be materially incomplete. As the Judge said: "If Teva had said what its actual state of mind was in response to a request from BMS,  it would have said it had no plans to launch efavirenz before expiry but was actively considering the option of doing so."
  • The patent was in force and Teva had the opportunity to challenge validity but chose not to do so. The option Teva was considering was to launch at risk, and therefore Teva was actively considering committing an act of patent infringement – an act which would be unlawful, would interfere with the patentee's legal rights, and would cause serious damage to the patentee.

No intention of launching?

Mr Justice Birss made an interesting comment in the course of his decision that might change the approach to responses to letters from patentees. As stated above, in its response to BMS' letter Teva stated that its launch plans were "confidential" and that it had a policy of not divulging those plans to competitors. However, the Judge rejected the notion that telling an originator patentee that Teva had an unequivocal plan to launch only after expiry of the patent or SPC would cause Teva any damage at all, particularly if that information was imparted to the patentee under terms of confidentiality to prevent wider dissemination (e.g. to other generics).