Irides: Weekly patent litigation update

The Irides Weekly Update is our round-up of patent litigation news highlights from around the world. Taking its name from the plural of “iris” - a nod to the ability of Irides to see what’s happening around the world.

Our latest edition - 10 May 2024 - is below:

UK

UKIPO rejects SPC after consideration of Art. 3(d) of SPC Regulation.

On 27 March 2024, Dr Lawrence Cullen, Deputy Director at the UKIPO (acting on behalf of the Comptroller) handed down his decision relating to two SPC applications filed by Halozyme, Inc. The two applications, SPC/GB15/047 and SPC/GB16/039 relate to products comprising recombinant human hyaluronidase (RHH) in combination with trastuzumab and rituximab respectively. Since the decisions in relation to both products depended on the role of RHH, the UKIPO addressed the two together.

Under Art. 3(d) of the Medicines SPC Regulation, an SPC may be granted only if the marketing authorisation (MA) cited in support of the SPC application is the first MA to place the product on the market as a medicinal product. The term “product” is defined in Art. 1(b) of the SPC Regulation as meaning “the active ingredient or combination of active ingredients in a medicinal product”.

The decisions turned on whether RHH can be considered to be an “active ingredient” for the purpose of the SPC Regulation and in particular whether the metabolic effect of RHH was discussed in the MA.

Halozyme argued that since RHH did: (i) improve the efficacy of the marketed products; and (ii) have a metabolic effect on human tissue by degrading hyaluronan (a polysaccharide found between cells) and “clearing a path” between cells, it must be an active ingredient. In doing so, it relied on information contained in the patents underlying the SPC applications.

The UKIPO disagreed. Following the decision of the CJEU in Forsgren (C-631/13), the UKIPO noted that for a substance to be an active ingredient, it must have a pharmacological, immunological or metabolic action of its own which is covered by the therapeutic indications of the marketing authorisation – this was not the case for RHH. Further, that action must be apparent from the relevant MA (comprising the Commission Implementing Decision, the SmPC and the EPAR). In the absence of any indication of such an effect in the MA, it is not possible to rely on evidence outside the MA. The UKIPO also drew attention to several references in the granted MAs where RHH was listed among “other excipients” to suggest that it was included as an excipient rather than an active ingredient.

The UKIPO therefore found that RHH was not an active ingredient for the purpose of the Medicines SPC Regulation and that the SPC applications had to be considered as applications for rituximab and trastuzumab by themselves. The underlying MAs were therefore not the first to place those products on the market, and the SPC applications were denied. One of the applications was additionally rejected under Art. 3(c) of the SPC Regulation owing to the existence of an earlier SPC for trastuzumab.

NL

Dutch Court Upholds €7.5 Million Penalty for Patent Infringement Breach.

On 26 March 2024, the Court of Appeal of Amsterdam held that Pharmathen Global B.V. (Pharmathen) must pay €7,500,000 to Novartis AG (Novartis) in penalties for breaches of a preliminary injunction (PI). This judgment of the Court of Appeal upholds an earlier decision of the Amsterdam District Court.

Novartis is the proprietor of EP 2 337 519 B1 (EP 519), validated in a number of European countries, including the Netherlands and Greece, and protecting a long acting release product containing octreotide (the LAR-product).

A Greek subsidiary of Pharmathen produces injectable LAR products in Greece. In proceedings in 2019, a Greek Court ruled that the LAR-product did not infringe EP 519. However, in Dutch proceedings brought by Novartis against Pharmathen in 2022, the District Court of The Hague found that the Greek subsidiary was in fact infringing EP 519, that Pharmathen’s role in this was unlawful and that there was a threat that Pharmathen would induce its Greek subsidiary to continue to infringe EP 519. The District Court of The Hague also found that there was infringement of EP 519 by Pharmathen due to it offering its LAR product in its Global Products Catalogue 2021. The District Court of The Hague ordered Pharmathen to stop: (i) inducing the infringement of EP 519 by its Greek subsidiary; and (ii) infringing EP 519. Penalties for breaches of this injunction were set at €100,000 per day.

This decision was appealed by Pharmathen and mostly upheld by the Court of Appeal. It is currently under review by the Supreme Court of the Netherlands, with a decision expected in September 2024.

After the PI decision at first instance, Novartis alerted Pharmathen to two alleged violations of the PI. One alleged breach related to sending infringing products to Guatemala and the other was that the Global Products Catalogue 2021 (which included the LAR-product) was available via the Wayback Machine on a third party website.

On 12 August 2022, Novartis informed Pharmathen that €7,500,000 in penalties had been incurred as a result of these breaches. This led to the proceedings before the District Court of Amsterdam. On 12 December 2022, the Court agreed that Pharmathen must pay the €7,500,000 for the breaches of the PI.

On appeal, the Court of Appeal of Amsterdam interpreted “offering” broadly. The Court confirmed that the fact that the 2021 Catalogue with the LAR-product was still accessible meant that an act of “offering” had taken place which constituted infringement of EP 519 whilst the PI was in place. The Court of Appeal rejected Pharmathen’s argument that a new Global Products Catalogue had been published in 2022 without the LAR-product and that potential buyers would interpret the availability of this new publication as a withdrawal of the 2021 Catalogue.

The Court of Appeal also rejected Pharmathen's argument that the LAR-products had been sold by its Greek subsidiary to Costa Rica before the PI decision, and then by a third party from Costa Rica to Guatemala. Pharmathen failed to provide evidence supporting this argument and did not offer a reasonable explanation for why Greece was listed as the land of origin in the Guatemalan public records instead of Costa Rica.

UK

High Court considers infringement by equivalence, joint liability, mosaicking and instruction of experts.

On 23 April 2024, Mr Justice Meade handed down his judgment in the dispute between Advanced Cell Diagnostics (ACD) and Molecular Instruments (MI).

ACD is the proprietor of two European patents which relate to in situ detection of nucleic acids in single cells. EP (UK) 1 910 572 (EP 572) claims a process for nucleic acid detection and EP (UK) 2 500 439 B1 (EP 439) claims kits and products for nucleic acid MI, a US-based company, manufactures and sells products in the US which support the in situ detection of nucleic acids using various probes. ACD alleged infringement by MI as a joint tortfeasor with its UK customers in respect of both patents and MI counterclaimed for invalidity.

The decision is replete with interesting points on substantive and procedural issues. In particular, Meade J:

• Considered whether the alleged infringing products infringed the patents on a normal construction or by virtue of the doctrine of equivalence, ultimately concluding that EP 572 but not EP 439 would have been infringed but for his finding of invalidity.
• Gave guidance on the issue of joint liability in the supplier/customer setting. A distinction was drawn between customers to which MI provided only general and standard directions by way of protocols, and other customers to which MI provided specific troubleshooting and tailored advice and tips for their specific needs. Applying the principles set out by the Supreme Court in Fish & Fish v Sea Shepherd UK, Meade J found the former went no further than “mere facilitation” and thus no joint liability, whereas the latter amounted to assisting customers pursuant to a common design by working a method which would have infringed EP 572.
• Looked at the issue of mosaicking pieces of prior art, finding that there is no absolute rule against mosaicking for anticipation but that for a combination to be possible for this purpose, the first document must point the skilled reader clearly and unmistakeably to the second document.
• Gave further guidance on the practice of sequential unmasking of information when speaking to potential expert witnesses. As many practitioners will know, in recent years in English patent litigation it has become established practice for potential expert witnesses to be instructed in stages – being first asked about the common general knowledge and then supplied with, and asked to comment on, the cited prior art and then, and only then, being supplied with a copy of the patent in suit. This approach is said to reduce the risk of the expert giving their views with hindsight but in practice it is not always possible because for instance the cited prior art might change quite late in the case. In ACD, the Court confirmed that taking this approach is the ideal approach but it is not compulsory.

Ultimately, both patents were held to be obvious over a combination of prior art documents. 

CA

Government of Canada announces the creation of Canada’s Drug Agency.

In December 2023, the Government of Canada announced plans to overhaul the Canadian Agency for Drugs and Technology in health (CADTH) to create a new body called Canada’s Drug Agency or L’Agence des Médicaments du Canada (CDA-AMC). The new name took effect on 1 May 2024.

In addition to continuing the work of CADTH on drugs, medical devices, and clinical interventions, the new CDA-AMC will aim to:

• improve the appropriate prescribing and use of medications
• increase pan-Canadian data collection; and
• reduce drug system duplication and lack of coordination.

The Canadian Government has invested CAD $89.5 million (around €61 million) over the next five years to fund the transition to the new CDA-AMC regime.