Author: Jason Rutt
21 June, 2018
Today the CJEU issued its judgement on Case C681/16 Pfizer v Orifarm, regarding the parallel imports of medicines from new EU member states (accession countries) into the old EU member states.
The CJEU has ruled that in situations where:
• patents were not available for the medicine in the accession countries at the time of filing the patent in the core EU countries, but
• SPC regulations had been introduced in the accession countries at the time SPCs were sought in the core EU countries,
an innovator possessing a patent and SPC in the old EU member states can rely on the Specific Mechanism to object to the parallel importation of a drug from those accession countries, even if the medicine was legally placed on the market in those countries.
In more detail.
The drug Enbrel® was approved in Switzerland in 2000. On the back of that approval, the patent protection covering this product was extended by obtaining an SPC and paediatric extension in the old EU member states.
Additional countries joined the EU in 2003, 2005 & 2012; these accession countries did not provide patent protection for inventions such as those disclosed in the Enbrel® basic patent at the time the Enbrel® patent was filed. The owner of the Enbrel® patent, which Pfizer later acquired, was therefore unable to obtain a basic patent in these accession countries and thus unable to obtain an SPC or paediatric extension of that patent. Enbrel® could thus legally be put on the market in those accession countries.
The Defendant Orifarm then sought to import Enbrel® from those new accession countries into those EU countries which had patent protection, arguing that the free movement of goods should apply. Normally a product put lawfully on the market in one country in the EU can then be lawfully imported into other countries in the EU. The patentees rights are said to be exhausted.
The patentee objected. Under the acts of accession by which these countries joined the EU, the ‘Specific Mechanism’ applies. This provides for the holder of a patent or SPC in a old EU member state to rely on its rights to prevent the importation of medicinal products from accession states if a patent or SPC was unavailable at that time.
The case turned on the fact that patent protection at the time of filing the basic patent was not available. However by the time the SPC was applied for in the old EU member states, the accession countries did provide for SPCs. Pfizer argued that a pre-condition for an SPC was that a basic patent be in force; if the country did not provide for a basic patent at time of filing, then the availability of an SPC regulations subsequently was an irrelevance. Pfizer had diligently sought patent protection where it was available. If a country didn’t have an Enbrel® patent, it was because Pfizer couldn’t obtain at that time; not that it chose not to obtain one. All countries in the pre-accession EU had an Enbrel® patent so as to prevent issues with third parties putting generic Enbrel® legitimately on the market in one country and flooding the rest of the EU by importation from that state.
The Court, following the Advocate General ruled that “The Specific Mechanism.. …must be interpreted as authorising the holder of an [SPC]… …to oppose parallel imports from new Member States…. …[which] did not yet provide [for a basic patent or SPC] at the time the application for a basic patent was filed with the result it was impossible for the patent holder to obtain an equivalent patent and a [SPC] in the exporting states.”
A company putting a drug on the market in the EU is aware of the rules and chooses its patent strategy accordingly. These are hugely significant commercial plans involving millions if not billions of euros. The company is entitled to be able to rely on those rules. When the maker of the rules changes the game the onus is on the referee to not penalise existing law abiding players.
Competitors in a market talk about the need for a level playing field. A decision against Pfizer would have been akin to making Pfizer play uphill in a game on Mount Everest. This careful ruling keeps things on the level.