Home > Insights > Landmark case awards first Arrow/Fujifilm declaration

Authors: Joanna Peak and Edward Ronan
29 March, 2017

In Fujifilm Kyoma and AbbVie [2017] EWCA Civ 1 (previously discussed here), the Court of Appeal ruled that “Arrow declarations” are, in principle, a remedy able to be awarded by the Patents Court. A subsequent decision (Fujifilm Kyowa Kirin Biologics v AbbVie Biotechnology [2017] EWHC 395 (Pat)), has shown that such declarations will be awarded in circumstances where a party is frustrating the normal statutory remedies. However the judge emphasised that declaratory relief of this sort is not appropriate in all cases.

To recap, a party requesting an Arrow declaration is essentially seeking a declaration that the specific product they are looking to manufacture, sell, use etc. would have lacked novelty or been obvious at a particular date. The purpose of such a declaration would be to provide the party with a Gillette defence to any subsequent claim for infringement of a patent with that date as the priority date. An Arrow declaration has the advantage that it can be obtained without any granted patent being in force, unlike the statutory mechanisms for revocation in the UK and at the EPO.

In this case, Fujifilm (and co-Claimants) sought to clear the way for launch of a biosimilar for AbbVie’s product Humira (or adalimumab). Following expiry of the SPC directed to the compound, AbbVie will be reliant on secondary patents to retain their monopoly in the UK. Two such patents were granted by the EPO; however, AbbVie withdrew its approval of the text of these patents such that they were revoked by the EPO. AbbVie instead maintained pending divisional applications divided from these patents, the applications including claims very similar to those of the parent patents. Due to the absence of a granted patent, Fujifilm was unable to use the statutory revocation mechanisms in the UK courts or at the EPO to clear the way for its biosimilar. Fujifilm therefore sought an Arrow declaration to the effect that their product would have lacked novelty or have been obvious at the priority date of the pending divisional applications. Such a declaration would essentially mean Fujifilm’s product would not infringe a valid patent arising from the divisional applications.

In the Court of Appeal decision it was held that Arrow declarations were permissible, but that the power to award them was discretionary and should be used having regard to the usual statutory revocation process. The principles governing the use of such discretion to grant a declaration were not set out by the Court of Appeal. However, in the recent decision, the judge (Mr Justice Henry Carr) has now clarified the relevant principles: namely, whether the declaration serves a useful purpose, provides justice to both Claimant and Defendant, and any special reasons for and against the grant of the declaration.

Useful purpose – When assessing this point, the judge held that AbbVie was prolonging commercial uncertainty by shielding its UK patents from scrutiny by the courts and repeatedly filing divisional applications, whilst at the same time expressing the intention to enforce its patents against biosimilars. The declarations would resolve this uncertainty. In addition, the judge found the declarations would protect Fujifilm’s supply chain from a “chilling effect” arising from potential patent litigation by AbbVie outside the UK. Finally, it was held that the declarations would serve a useful purpose in promoting settlement between the parties.

The judge indicated that the “spin-off” value of a declaration from a UK court in another jurisdiction does not in itself demonstrate that the declaration serves a useful purpose.

Justice to both parties – Following the finding that Fujifilm’s products were known or obvious at the priority date of AbbVie’s divisional applications, the judge held that there was no injustice to AbbVie as a result of granting the declarations. Also persuasive was that an extensive contested trial had taken place in which AbbVie resisted the grant of the declarations, but had not succeeded.

Special reasons – The judge held that the facts of this case were “most unusual” and gave rise to special reasons in support of the declarations being granted. These included AbbVie’s conduct in shielding its patents from scrutiny, the money at stake for Fujifilm if they launched without clearing the way beforehand, and the commercial uncertainty arising from AbbVie’s shielding conduct in combination with threats of litigation.

After considering these factors, the judge awarded the declaration sought by Fujifilm (and the co-Claimants). As a result, Fujifilm’s biosimilar will not infringe a valid patent having an effective date on or later than AbbVie’s divisional applications.

This judgment is notable as the first time a declaration such as this has been awarded in the UK. Such “Fujifilm declarations” could provide a mechanism for companies to clear the way even when no patent has been granted. However, both Carr J and the Court of Appeal emphasised that such declarations will not be available when a claimant simply wants to know whether a patent application will result in a valid patent – rather, they should be available when the usual statutory remedies are being frustrated such that the claimant cannot obtain the relief they need.

Authors

Joanna Peak

Joanna Peak
Partner

Phone this number +44 (0)20 7430 7500

Email this address jpeak@boult.com

Verulam Gardens
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London
WC1X 8BT

Edward Ronan

Edward Ronan
Patent Attorney

Phone this number +44 (0)20 7430 7500

Email this address eronan@boult.com

Verulam Gardens
70 Gray's Inn Road
London
WC1X 8BT