The CMS patent litigation team in London have provided a review of the Royalty Pharma decision (C650/17). Many thanks to Gareth Morgan, Natalie Coan and Hannah Rigby for their thoughts.
On 30 April 2020, the CJEU ruled on the interpretation of
Article 3(a) of the SPC Regulation in an action between the Royalty Pharma
Collection Trust and the German Patent and Trademark Office (C-650/17)
(“Royalty”).
In its ruling, the CJEU in Royalty held that a
product developed after the filing date of a patent following an independent
inventive step but falling under the functional definition of said patent was
not considered ‘protected’ under Article 3(a) of the SPC Regulation. The case brings
greater clarity after an uncertain line of case law following Medeva (C-322/10)
in relation to what is ‘specified in the wording of the claim’. The CJEU in the
Royalty ruling confirmed the test endorsed by the CJEU in Gilead (C-121/17)
by following the two pronged test but most notably added clarification by
confirming that the term “core inventive advance” was not relevant to the
interpretation of Article 3(a). Until now the CJEU had failed to offer a clear
test for applying Article 3(a) but this decision has the effect of finally
placing the interpretation of Article 3(a) on more stable ground.
Article 3(a) of the SPC Regulation requires that a product
be protected by a basic patent in force before an SPC may be granted in respect
of it. Medeva introduced the concept of ‘specified in the wording of the
claim’, although it was unclear what that really meant. A further layer of
confusion appeared in the CJEU’s decision in Actavis (C-443/12)
which stated that the product had to constitute “the core inventive advance of
that patent”. That case related to Article 3(c) but the CJEU referred to the
same test in Actavis (C-577/13)
which related to Article 3(a). It was then unclear when exactly the core
inventive advancement of the patent should be taken into consideration and
whether it had replaced the Medeva test.
Arnold J sought some clarity on this point in his referral
to the CJEU in Gilead. In his referral, Arnold J suggested that ‘protected
by the patent’ should mean that the product must ‘embody the core inventive
advance’ of the patent, replacing ‘specified in the wording of the claim’. The
CJEU did not explicitly reject this proposal but confirmed that each active
ingredient should (1) necessarily fall under the invention covered by the
patent; and (2) be specifically identifiable in light of the information
disclosed by that patent. Arnold J took this to mean that the patent’s
technical contribution was relevant to the assessment. The UK Court of Appeal
subsequently overturned Arnold J’s interpretation, replacing this with a
simpler test of whether all components of the “product” were necessarily
required by the language of the claim.
The confusion caused by pre-Gilead case law has
however remained, leading to a number of referrals, including that of the
German Federal Court in Royalty.
Royalty Pharma had applied for an SPC protecting
sitagliptin on the basis of its patent claiming use of dipeptidylpeptidase IV
inhibitors to lower blood glucose levels. Sitagliptin was developed after the
filing date of the relevant patent. It is however a dipeptidylpeptidase IV
inhibitor and was therefore covered by the functional definition in the
patent’s claims.
The German Federal Court requested guidance as to whether a
product is protected under Article 3(a) where:
1. The
product is not expressly referred to in the patent’s claims;
2. The
product is not considered the specific embodiment of the patent;
3. The
product was developed after the filing date of the patent; and
4. The
product was covered by a functional definition in the patent’s claims.
The CJEU held that Article 3(a):
“is to be interpreted as
meaning that a product is protected by a basic patent in force within the
meaning of this provision if it corresponds to a general functional definition
used in one of the claims of the basic patent and necessarily relates to the
invention protected by this patent, but without being individualized as a
specific embodiment from the teaching of the patent, provided that it can be
specifically identified, in light of all the information disclosed by said patent,
by a person skilled in the art, on the basis of their general knowledge in the
field, considered on the filing or priority date of the basic patent and the
state of the art on that same date.”
This ruling follows the ruling in Gilead.
The CJEU’s clarification seems to have confirmed that the
test for Article 3(a), in effect, equates to a question whether there has been
an enabling disclosure of the product. The CJEU held that:
“Article 3(a) must be
interpreted as meaning that a product is not protected by a basic patent in force
within the meaning of that provision where, although that falling under the
functional definition given in the claims of this patent, it was developed
after the filing date of the application for the basic patent, at the end of an
autonomous inventive step.”
The CJEU has therefore confirmed that the patentee of the
basic patent must demonstrate that the skilled person could produce the product
which is the subject of the SPC using only the common general knowledge and
prior art, with no inventive activity.
The Royalty ruling confirms, and clarifies, the Gilead
decision. It represents another nail in the ‘core inventive advance test’
coffin with respect of Article 3(a), and further demarcates the appropriate
test for Article 3(a). Notwithstanding
the clarity offered on Article 3(a) new questions arise in respect of the
compatibility of this ruling with the earlier Actavis case law on
Articles 3(a) and 3(c), and also the extent to which any later independent
inventive activity creates a new “product” for the purposes of SPC eligibility.
