Supplemental Protection Certificates - Eli Lilly and Co. v Genentch Inc
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Jane Lambert
Patents Court (Mr Justice Arnold) Eli Lilly And Company v Genentech, Inc No. 2 [2019] EWHC 388 (Pat) (1 March 2019)
One of the issues before Mr Justice Arnold when he tried Eli Lilly and Company and others v Genentech, Inc [2019] EWHC 387 (Pat) (1 March 2019) was whether Genentech was entitled to a supplemental protection certificate ("SPC").
A guidance note from the IPO published on 16 May 2014 and last updated on 27 June 2019 describes an SPC as a "form of IP that extends the protection of patented active ingredients present in pharmaceutical or plant protection products." The policy behind SPCs is as follows:
"Pharmaceutical or plant protection products need regulatory approval to be sold in the UK and must obtain:
- a marketing authorisation
- or product licence
A Supplementary Protection Certificate (SPC) compensates for the delay."
The legislation that provides for SPCs for drugs s is Regulation (EC) No 469/2009 of the European Parliament and of the Council for pharmaceutical products.
Art 3 (1) of that regulation provides:
"A certificate shall be granted if, in the Member State in which the application referred to in Article 7 is submitted and at the date of that application:
(b) a valid authorisation to place the product on the market as a medicinal product has been granted in accordance with Directive 2001/83/EC or Directive 2001/82/EC, as appropriate;
(c) the product has not already been the subject of a certificate;
(d) the authorisation referred to in point (b) is the first authorisation to place the product on the market as a medicinal product."
Genentech applied for an SPC in respect of European patent 1641822 even though it did not have a product of its own that was protected by the patent. Lilly, however, did have a product called Ixekizumab that was alleged to infringe the patent. Lilly objected to the application on the ground that Genentech had neither a valid patent nor a product of its own that was caught by the patent and applied for a declaration that any SPC that might be granted pursuant to Genentech's application would not be valid. Mr Justice Arnold delivered his judgment on this issue separately.
In Genentech's counterclaim for infringement which I discussed in Patents - Eli Lily v Genentech 17 July 2019, the judge held that claim 1 of the patent but not claim 12 would have been infringed had those claims been valid. His lordship summarized Eli Lilly's argument at paragraph [39] of his judgment:
"Lilly contends that it is the object of the SPC Regulation to compensate research organisations for the delay caused by going through the regulatory process to obtain a marketing authorisation, and the consonant loss of monopoly time in which to market their product. An undertaking which is not one that has suffered that lost time, because it is not the one that obtained the marketing authorisation, needs and deserves no such compensation. Accordingly, Lilly contends that an SPC cannot validly be granted on the basis of a third party MA. Lilly argues that these contentions are supported by the statements of the CJEU in Lilly v HGS and Teva CJEU and by the statements of the national courts in Novartis v MedImmune and Sandoz v Searle quoted above. Lilly accepts, however, that the point is not acte clair, and therefore a reference to the CJEU is necessary to determine it."
He summarized Genentech's argument in paragraphs [41] and [42]:
"Lilly contends that it is the object of the SPC Regulation to compensate research organisations for the delay caused by going through the regulatory process to obtain a marketing authorisation, and the consonant loss of monopoly time in which to market their product. An undertaking which is not one that has suffered that lost time, because it is not the one that obtained the marketing authorisation, needs and deserves no such compensation. Accordingly, Lilly contends that an SPC cannot validly be granted on the basis of a third party MA. Lilly argues that these contentions are supported by the statements of the CJEU in Lilly v HGS and Teva CJEU and by the statements of the national courts in Novartis v MedImmune and Sandoz v Searle quoted above. Lilly accepts, however, that the point is not acte clair, and therefore a reference to the CJEU is necessary to determine it."
He summarized Genentech's argument in paragraphs [41] and [42]:
"[41] Genentech contends that it is implicit in Biogen v SKB that the basic patent and the marketing authorisation may be held by different and unconnected parties; that Lilly’s contention requires the Court to read into the SPC Regulation words which are simply not present; and that, in accordance with recital (17) to European Parliament and Council Regulation 1610/96/EC of 23 July 1996 concerning the creation of a supplementary protection certificate for plant protection products, the SPC Regulation should be interpreted in accordance with Article 3(2) of Regulation 1610/96/EC which, so Genentech argues, makes it clear that SPCs can be based on third party marketing authorisations. Article 3(2) of Regulation 1610/96/EC provides:
'The holder of more than one patent for the same product shall not be granted more than one certificate for that product. However, where two or more applications concerning the same product and emanating from two or more holders of different patents are pending, one certificate for this product may be issued to each of these holders..
[42] Genentech contends that the law is acte clair in its favour, but in the alternative argues that a question should be referred to the CJEU."
'The holder of more than one patent for the same product shall not be granted more than one certificate for that product. However, where two or more applications concerning the same product and emanating from two or more holders of different patents are pending, one certificate for this product may be issued to each of these holders..
[42] Genentech contends that the law is acte clair in its favour, but in the alternative argues that a question should be referred to the CJEU."
Although the judge thought that the Court of Justice's decisions in Eli Lilly and Teva, the national courts' decisions in Novartis v MedImmune and Sandoz v Searl and an article by Jens Schovsbo and others supported Lilly, the law was not clear. He, therefore, referred the question
“Does the SPC Regulation preclude the grant of an SPC to the proprietor of a basic patent in respect of a product which is the subject of a marketing authorisation held by a third party without that party’s consent?”
to the Court of Justice under art 267 of the Treaty on the Functioning of the European Union.
Having already found the patent to be invalid, it was arguable that the reference was otiose because there was no valid patent on which an application under art 3 (1) (a) could be based. He was persuaded to make the reference on the grounds that his decision on validity could be reversed on appeal, that the issue was likely to arise in similar proceedings between the same parties in other member states of the EU and that nobody had such a reference before even though it was a live issue in the pharmaceutical industry,
Having already found the patent to be invalid, it was arguable that the reference was otiose because there was no valid patent on which an application under art 3 (1) (a) could be based. He was persuaded to make the reference on the grounds that his decision on validity could be reversed on appeal, that the issue was likely to arise in similar proceedings between the same parties in other member states of the EU and that nobody had such a reference before even though it was a live issue in the pharmaceutical industry,
Anyone wishing to discuss this article or SPCs generally should call me on 020 7404 5252 during office hours or send me a message through my contact form.
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