A niche blog dedicated to the issues that arise when supplementary protection certificates (SPCs) extend patents beyond their normal life -- and to the respective positions of patent owners, investors, competitors and consumers. The blog also addresses wider issues that may be of interest or use to those involved in the extension of patent rights. You can email The SPC Blog here

Tuesday, 17 September 2013

Res judicata, invalidity and prima facie validity: a curious Belgian concoction

"Invalidated SPC retains prima facie validity in preliminary injunction proceedings" is the grand title of a note by Kathleen Mercelis and Philippe de Jong (Altius) which was recently published on International Law Office.  The note deals with a Belgian Supreme Court ruling on the end-game in a battle between generics manufacturer Eurogenerics and Lundbeck, whose SPC for escitalopram had been invalidated.  The facts are a little unusual, as appears from the text:
Pharmaceutical company Lundbeck held a European patent for escitalopram, the active substance of an antidepressant commercialised in Belgium under the trademark SIPRALEXA. The patent expired in 2009, but Lundbeck obtained a supplementary protection certificate (SPC) extending protection for escitalopram until June 1 2014. However, the SPC was invalidated by the Brussels Commercial Court following a nullity suit brought by several generic manufacturers. Lundbeck appealed that decision. 
Pending the outcome of the appeal, another generic company, Eurogenerics, brought its generic version of escitalopram to market. Lundbeck started preliminary injunction proceedings against Eurogenerics based on the invalidated SPC. At first instance, Lundbeck's claim was rejected, but its appeal was successful and the Brussels Court of Appeal issued an injunction against Eurogenerics. According to this court, the Supreme Court decision of January 5 2012(1) – which held that the revocation of a patent by the European Patent Office's opposition division, against which an appeal had been lodged pursuant to Article 106(1) of the European Patent Convention, did not affect the prima facie validity of the Belgian counterpart of the revoked patent – was equally applicable to the present circumstances. The court held that the appeal of a nullity decision of a Belgian court has suspensive effect as well. Lundbeck's SPC was therefore found to retain its prima facie validity pending the outcome of the appeal against the first instance invalidation decision (in which the SPC was eventually upheld).(2) 
Supreme Court decision 
Eurogenerics appealed to the Supreme Court, claiming that the annulment of the SPC by the first instance court had the authority of res judicata (ie, the fact that a case has already been decided) and should therefore have been respected by the court that issued the preliminary injunction. 
The Supreme Court rejected Eurogenerics's reasoning and upheld the decision of the Brussels Court of Appeal on the following grounds: 
  • There is a difference between the authority of res judicata, which is attributed to every final court decision that has not been overruled, and the force of res judicata (ie, an unappealable decision). As long as the decision has no force of res judicata, the authority of res judicata is only conditional.
  • According to the Belgian Patent Act, a decision by which a patent is invalidated normally has the authority of res judicata. However, such decisions are not recorded in the patent register before obtaining the force of res judicata.
  • The Patent Act also states that an appeal to the Supreme Court has suspensive effect with respect to an invalidated patent.
  • Finally, the Belgian Judicial Code states that an appeal normally suspends the enforceability of a decision. 
The Supreme Court consequently held that a patent that was invalidated by a first instance decision can still be the basis for a subsequent preliminary injunction action. 
In its January 5 2012 decision the Supreme Court held that the fact that a patent was revoked by the opposition division of the European Patent Office did not affect the prima facie validity of the revoked patent, as long as no final decision has been taken in the opposition proceedings, because according to Article 106(1) of the European Patent Office, an appeal against decisions of the opposition division has suspensive effect. 
In the present case, the Supreme Court took this reasoning one step further and found that the prima facie validity of a patent (or SPC) is also not affected by an invalidity decision of a national court, notwithstanding the fact that this decision has the authority of res judicata. Consequently, a patent holder requesting a preliminary injunction against an alleged infringer can rely on the prima facie validity of its patent or SPC until the decision by which the patent was invalidated has obtained the force of res judicata – that is, once an appeal to the Supreme Court has been rejected or the limitation period for bringing the appeal has expired.
(2) Brussels Court of Appeal, September 17 2012, IRDI 2013, p 40.

"One SPC per patent" again -- this time in the Netherlands

From our friend Martijn de Lange comes news of a fascinating Dutch development. Explains Martijn:
"The Court of Appeal has decided in a case concerning the product irbesartan + HCTZ that the CJEU rulings in Medeva and Georgetown should be read as "one SPC per patent", not "one SPC per product per patent" (see (i) this summary on the IE-Forum blog, and (ii) the full judgment which is reasonably readable with Google Translate). 
The Court notes that, even if this restriction set by the CJEU would not be in agreement with the SPC Regulation, this does not automatically imply that the restriction does not apply. 
The Court points out that the CJEU has on other occasions imposed restrictions on IP rights which cannot (directly) be found in the applicable guidelines or regulations. 
The Court then explains that this restriction may be in agreement with the Regulation if the term 'product' is interpreted narrowly as the ' invented basic substance'.

This all came in on the eve of the oral hearing last week in Luxembourg in the Georgetown, Eli Lilly and Actavis cases.

Most of the parties involved (like most if not all national patent offices in the past) have have rejected the "one SPC per patent" interpretation, but I do agree with the Court of Appeal that this is what the CJEU meant in Medeva and Georgetown and, in my opinion, the Court of Appeal does a most admirable job under the circumstances in explaining how this could be in agreement with the Regulation since the CJEU does not provide any argumentation in their own judgements, hence the mess we're in".
Note that this was a case for injunctive relief, adds Martijn, not a decision on the merits.

Thanks so much, Martijn, for keeping us up to date!

Tuesday, 3 September 2013

the news you've been expecting: nothing in the NZ Act on SPCs

New Zealand's Patents Act, which seems to have been in the pipeline for longer than most of us can remember -- or care to remember -- has now become a reality. With this reality comes the unsurprising news that our Antipodean brethren have made no specific provision for patent term extension for pharmaceutical or agrochemicals. According to New Zealand-based law firm Simpson Grierson
"The new Act does not introduce patent term extension for pharmaceuticals, meaning New Zealand remains out of step with most of its major trading partners. This may not be the end of the story, however. With the Trans-Pacific Partnership negotiations far from complete, this is one area that will continue to receive focus, possibly leading to the new Act's amendment to provide for patent term extensions".
This blogger wonders whether this is a prophetic statement or a little bit of wishful thinking, given the recent willingness of New Zealand's near-but-distant neighbours Australia to take a long, hard look at the entire primciple of patent terme extension.