Arrow Declarations

Author Dfrg.msc Public Domain Source Wikimedia Commons

 

Jane Lambert

Patents are intended to promote innovation but occasionally they work against the public interest.  For instance, the term of a pharmaceutical patent that is about to expire may effectively be prolonged by a patent for a new dosing regime or a second medical use.  Sometimes the patents for such inventions may be revoked or a declaration of non-infringement may be granted  A company that wants to launch a competing product will often bring revocation or non-infringement proceedings to clear the way for the launch.

However, s.69 (2) of the Patents Act 1977 makes clear that such proceedings can be brought only after a patent has been granted.   There is a risk in launching a new product while a patent application is being considered because s.69 (1). allows a claim for damages to be backdated to the publication of the application.   That can be a problem not only for the competitor whose market entry is delayed but also for the public because the National Health Service has to pay more for the drug than it should. 

The Patents Court has developed a solution to the problem known as "the Arrow declaration".   Its name is derived from Arrow Generics Ltd and another v Merck & Co, Inc. [2007] FSR 39, [2007] EWHC 1900 (Pat), [2008] Bus LR 487. This was an application by Merck & Co. ("Merck") to strike out a claim for a declaration that:

"the Defendant is not entitled to rely on the Patent or any other European patent (UK) granted pursuant to applications nos. 01201911.3, 01201912.1 and 01201910.5 and any further divisional applications arising under them to prevent the Claimants from selling or supplying their 70 mg once-weekly alendronate products."

The claimant company, Arrow Generics Ltd. ("Arrow") marketed a 70 mg alendronate tablet to be taken once every week for the treatment of osteoporosis with the result that the price of a pack of 4 tablets fell in the UK from £15 to £18 to £1 to £2.  Before doing so Arrow obtained the revocation EP 0 998 292 ("292") in the United Kingdom on grounds of anticipation and obviousness and that it was a method of treatment of the human body by therapy.   Claim 8 of that patent had claimed:

"A method according to claim 7 wherein said dosing interval is once-weekly and said unit dosage comprises about 70 mg of alendronate monosodium trihydrate, on an alendronic acid active basis."

Opposition proceedings were brought in the European Patent Office under art 99 of the European Patent Convention which also resulted in that patent's revocation. 

Before 292 was revoked Merck filed 4 divisional applications.  Claim 1 of those applications was in "Swiss" form and directed to the use of alendronate to make a medicament for the treatment of osteoporosis in a human, where the medicament is orally administered as a unit dosage comprising about 70mg of alendronate, according to a continuous schedule having a once-weekly dosing interval.   As Mr Justice Kitchin,  who heard the application to strike out Arrow's claim, observed at para [8] of his judgement. the key idea was "essentially the same as that the subject of the 292 patent, namely give osteoporosis patients 70mg of alendronate once a week."

The divisional applications had been stayed during the opposition proceedings but they were allowed to continue afterwards notwithstanding the revocation of 292 in England and at the EPO "on the basis of a declaration by a Dr Goldberg of Merck which is said to provide details of a statistically significant effect arising from the administration of a 70mg alendronate tablet once a week, rather than a 10mg tablet once a day."    Arrow was dismayed by those developments because it had cleared the way for its product by revoking 292 in England and at the EPO.  It had built up a substantial business.  Merck for its part made no secret of its intention to sue Arrow and any other generic manufacturers just as soon as it could.

The judge considered whether the declarations sought would serve a useful purpose and concluded at [58] that they would:

"Arrow took proceedings to clear the path before launching its once-weekly 70mg alendronate product – a generic equivalent to Fosamax. It was successful in all those proceedings. But Merck retained a series of divisional applications which also have a "GB" designation. The EPO has now reversed its position and decided, at least for the moment, that Merck is indeed entitled to patent protection for Fosamax and Merck has indicated that it intends to enforce its rights. One divisional application has proceeded to grant but, at the last possible moment, Merck de-designated the UK (for reasons it has not explained) so Arrow cannot apply here to revoke it. Nor can it incur here any liability in respect of it. But the other divisional applications are following on behind and for each of these Merck has retained the "GB" designation. Two of them presently have claims which cover Arrow's product. Despite an invitation, Merck has declined to give Arrow any assurance that it will not seek to enforce its rights arising from those divisionals against Arrow in this country. So Arrow is currently incurring a substantial liability under section 69 of the Act. There is a public interest in commercial certainty in patent matters as in any others. Business needs to know where it stands. I believe this court should assist in providing that certainty where it properly can. The declarations sought would provide Arrow with the assurance that its alendronate product cannot offend against Merck's patent rights arising in this country from the remaining divisional applications. Accordingly, the declarations have a valuable commercial purpose."

He considered that the underlying issue was sufficiently clearly defined to make it justifiable:

"Arrow does not contend it would be proper for this court to declare that no valid patent could be granted on the remaining divisional applications. Instead, Arrow seeks much more limited declarations, namely that its own product was obvious at their priority date. It has identified the essential characteristics of its product and the prior art which it says renders that product obvious. In my judgment this is a clearly defined issue which is readily susceptible to determination. Indeed, it is the kind of determination which this court is well used to making."

As Arrow was seeking only a declaration as to essential characteristics of its own product and not a declaration as to the validity of any patent that might be granted, the judge was not satisfied that the court had no jurisdiction to grant the declarations sought or that the court should refuse the relief in the exercise of its discretion. 

The Court of Appeal has considered the discretionary power to grant Arrow declarations in Fujifilm Kyowa Kirin Biologics Co Ltd v AbbVie Biotechnology Limited and another [2017] EWCA Civ 1, Glaxo Group Limited v Vectura Limited [2018] EWCA Civ 1496, [2019] Bus LR 648, [2018] WLR(D) 400 and Mexichem UK Ltd v Honeywell International Inc [2020] EWCA Civ 473 (1 April 2020). I discussed the last of those cases in Arrow Declarations - Mexichem UK Ltd v Honeywell International Inc on 5 April 2020.  It is settled that the court may grant such declarations where the circumstances do require.

The jurisdiction to grant Arrow declarations was extended in Mexichem. There the claimant sought a declaration that the idea of using R-1234ze and R-1234yf in the manufacture of products for use as refrigerants was obvious in the light of the teaching of a Japanese patent rather than a declaration that a specified product or process was known or obvious.  Judge Hacon had rejected an application to strike out the claim for the declaration and the Court of Appeal held that he had been right.  Lord Justice Floyd said at para [18] of his judgment:

"There is no threshold requirement for the grant of an Arrow declaration that the party seeking it must have a fully formulated product description, far less that it must have a product in actual production. What must be established at trial is that it would be useful for specified features of a product which the party wishes to sell to be declared old or obvious. The extent of generality or particularity of the declaration may affect the utility of the declaration. That, however, is plainly a matter of degree which it will be for the trial judge to assess."

Arrow declarations are not automatic.   In Financial Services Authority v Rourke  [2001] EWHC 704 (Ch), [2002] CP Rep 14, Mr Justice Neuberger (as he then was) directed himself as follows:

"when considering whether to grant a declaration or not, the court should take into account justice to the claimant, justice to the defendant, whether the declaration would serve a useful purpose and whether there are any other special reasons why or why not the court should grant the declaration."

In Pfizer Ltd v F. Hoffmann-La Roche AG and another  [2019] EWHC 1520 (Pat) Mr Justice Birss refused to grant declarations in relation to bevacizumab which is used in the treatment of cancers because it would cease to serve a useful purpose.  That was because the defendants had withdrawn requests for their  European patent applications to be designated for the UK.  He said at para [118] of his judgment:

"If today there were pending UK applications in any of the families, this would be a plain case for an Arrow declaration and I would go on to examine the merits of the Gillette defences in detail. However given the complete absence of the possibility of UK rights in future, the reality is that the commercial value of an Arrow declaration to Pfizer is the utility it might have (along with a reasoned judgment) in helping Pfizer defend itself against suits brought by Roche in other European countries. This case is unlike FujiFilm in that in relation to bevacizumab there is no outstanding uncertainty at all relating to UK rights. Pfizer does not need the Patents Court to tell it or anyone else that it can freely sell bevacizumab in this country without risk from the Roche patent families."

Offering undertakings not to bring proceedings in respect of the subject matter of a proposed declaration may also be enough to defeat an application for an Arrow declaration.  One of the reasons why Mr Justice Kitchin refused to strike out Arrow's claim was that Arrow had invited Merck to give such an undertaking but Merck had rejected it. However, Glaxo Group shows that care must be given to drafting the undertaking otherwise the court may disregard it.

An interesting point that arose in Pfizer is that Mr Justice Birss did not rule out the possibility of granting an Arrow declaration for use in foreign litigation.   He said at [122]:

"When the action began it was not forum shopping at all. There were pending UK applications which provided a basis for considering an Arrow declaration. However now they have gone. There might have been other factors which justified Arrow relief such as arose in Fujifilm but on examination in this case, there are not. There is no evidence of uncertainty about UK patent rights. The true purpose of an Arrow declaration in this case would be for it to be used in foreign courts. I am not persuaded that that is enough."

Such a declaration might be justified if a foreign court needed certainty on a point of English law as in Deutsche Bank (China) Co Ltd, Shanghai Branch v Bright Food Hong Kong Ltd [2017] EWHC 3543 (Comm) (8 Dec 2017).  However, it is unlikely that an English court would ever trespass on matters that fall exclusively within the competence of a foreign court.

Arrow declarations are an important remedy but they are available in relatively rare circumstances.  They are discretionary and hence almost entirely dependent on their own facts.  Anyone requiring further information about them may call me on 020 7404 5252 during office hours or send me a message through my contact form.