Quetiapine in Turin: court-appointed expert's analysis rejected

In an IPKat post back in March 2012 Darren Smyth wrote about what he called the “tigers v lions” quetiapine case; patents for this substance have been litigated in various locations [including Bulgaria, where some vigorous litigation over the SPC was noted by this weblog here back in 2011], and most recently in Italy before the Turin Court. The guest post below comes from Gian Paolo di Santo (Pavia e Ansaldo), who writes as follows:

With its decision n. 4000/15 issued on 1 June in Case 628/2013 [in the original Italian here and in English translation here] between Sandoz and AstraZeneca a Panel of three specialized Judges of the Turin Court has declared the Italian portion of European Patent No. EP 0 907 364, which had as object an extended-release formulation containing a gelling agent and quetiapine as an active principle having an antipsychotic function, to be null and void for lack of inventive step.

This decision is perfectly in line with a long and rather straightforward sequence of European decisions that held this same patent EP 364 to be invalid (similar decisions have indeed been issued in UK, Germany and The Netherlands (with final decisions) as well as in Spain and Belgium (with decisions that are currently under appeal by AstraZeneca).

The patent at stake is a formulation patent applied for in 1997 that was meant to protect the sustained release version of quetiapine, now a blockbuster drug in the antipsychotic field, already patented as such in 1987 and for which AstraZeneca enjoyed exclusivity until 2012 by virtue of an SPC. In a nutshell the patent holder claimed that at the priority date of EP 364 there was not enough information on quetiapine as such in order for an expert in the field to embark him/herself in the realization of a new formulation for such a compound, given also a series of possible downside of sustained release formulation in antipsychotic field and in particular with respect to the quetiapine molecule. The position of Sandoz was that, since the expert was aware of the need for a reduced posology of medicines in general and especially of antipsychotics (in Italy in particular it was proven that at least three other antipsychotics drugs had been formulated in sustained release before the priority date), it would have been obvious to go for a sustained release formulation of quetiapine, which was the perfect candidate both under a commercial point of view and from a pharmacology point of view.

What I consider interesting in the Italian extension of the case is that, when assessing the invalidity the Turin Court has -- rather unusually -- rejected the opinion of the Expert that had been appointed by the same Court to provide technical guidance (the appointment by courts of a technical Expert in patent proceedings is common practice).

The Expert appointed by the Court had analyzed all the alleged problems put forward by AstraZeneca (to name a few among a very very long list: occupancy of D2 receptors; PH-dependent solubility; clinical prejudice against once-a-day formulations) and found them not to be actual “prejudices” but simple “obstacles” that an expert in the field could overcome by means of simple routine activities. Still, however, the Expert suggested in his report to the Court that, given that no medicine based on quetiapine had yet been put into the market at the priority date of EP 364 (the studies on quetiapine were in advanced phase III), an expert in the field would not have had sufficient reasons to try and test a sustained release formulation in order to overcome the problem of reducing the number of daily doses. This, in fact, would have implied the necessity to start lengthy and expensive research. The Expert consideretherefore the patent to be valid since the expert in the field did not have sufficient motivation nor pointers towards the then patented solution.

The Italian Court completely rejected this point by affirming the following: 

“the overcoming of those obstacles and the identification of the pharmacokinetics data concerning quetiapine – the latter was not yet marketed at the priority date of the patent –  implied an activity, which can be qualified as a mere routine activity for the expert of the field, consisting of clinical trials. The statement of  the Court Technical Expert who affirmed that those barriers would have discouraged the expert of the field, who could have reached the invention but would have not found a stimulus to do that, is not shareable. After all, the same Court Technical Expert affirmed that the expert of the field could have identified such elements through clinic research and that the long analysis which were necessary may also be qualified as routine ones in the pharmaceutical field, in the sense that they have in any case to be carried out but require the use of a great number of employees and resources as well as a substantial economic disbursement. Moreover, the necessity to make use of employees and resources and the costs of the analysis is an element which is not enough to state the inventive step of the patented technical solution because the expert of the field was not required to carry out any inventive activity but instead merely usual clinic research and tests” (see lines 276, ff. of the English translation).

In the context of such a long and high-value proceeding the aspects scrutinized were many more and a full reading of the decision may provide further valuable insights (almost every aspect such as definition of the technical problem, identification of the expert in the field and so on were discussed). Still, I think this particular aspect is an interesting interpretation of the inventive step requirement in Italy that may come into question in other cases where the patent holder tries to sustain the validity of the patent on the basis of an “economic analysis” of the situation in the prior art, instead than demonstrating the true technical advancement brought by the patented solution (which in this case was held to be minimum or even absent).

To what I said above I should add a couple more pieces of information. On the one side two parallel cases on the merits (involving Accord and TEVA v AstraZeneca) have not been decided yet on this same patent, although preliminary injunctions requests have been submitted by AstraZeneca and refused by the same Court on the basis of the same arguments on which the decision at stake is based. I should also add that AstraZeneca can still appeal this decision in favour of Sandoz before the Court of Appeal.

Xalatan in Italy: two recent case comments

The lengthy, complex and controversial litigation in Italy over Xalatan and Pfizer's attempts to preserve its market in Italy has been chronicled on this weblog (see earlier SPC Blog posts, listed here). It is also being written up in the legal literature. Here's news of two recent case notes.

• "The Highest Italian Administrative Court has the Final Word on the Xalatan Case and Reinstates the Original Infringement Decision of the Italian Competition Authority", by Michele Giannino (Desogus Law Office) appears in the current issue of the Bio-Science Law Review (BSLR) which, incidentally, has a 20% reduction offer for new subscribers that finishes today.
  
• "Pfizer's misuse of patent/SPC rights results in an abuse of dominant position", by Gian Paolo Di Santo (Studio Legale Pavia e Ansaldo) appears in the July 2014 issue of the Journal of Intellectual Property Law & Practice (JIPLP), Gian Paolo having acted in this case for Assogenerici and some of the original plaintiffs against Pfizer.

U-turn on the U-turn: more comments on the Italian latanoprost antitrust decision

Recently the new decision issued by the Italian antitrust authorities in the matter of the latanoprost case was discussed on this weblog (see earlier posts here and here).

Micaela Modiano (Modiano & Partners) and Anna Maria Stein (Franzosi Dal Negro Setti) now add more information about this important decision, so as to shed some light on why, after the the Italian antitrust authority (Autorità Garante della Concorrenza e del Mercato) had first found that Pfizer had abused its dominant position, and after a first U-turn of the Italian administrative court (Tribunale Amministrativo Regionale) denying that there had been any abuse by Pfizer, the administrative appeal court (Consiglio di Stato) has now taken a further U-turn and instead held that Pfizer has abused its position.

As those of you who have followed this case already know, Pfizer owned a patent with compound claims to, inter alia, latanoprost on which it had filed SPCs and paediatric extensions in various EU countries, but not in Italy. Pfizer had obtained a divisional on the basis of that patent, had validated the patent in Italy, Portugal and Spain and then obtained an SPC and a paediatric extension in Italy on the basis of the divisional patent. At the end of opposition proceedings, the divisional patent had been maintained with claims to the use of latanoprost for a certain therapeutic indication.

The Italian antitrust authority had held that Pfizer had abused its dominant position. Important factors which had led to such decision were the fact that Pfizer had not clearly informed the Italian Patent and Trade Mark Office that the Italian SPC application was based on the divisional while in other EU countries it was based on the parent patent. This was a clear attempt to draw principles from the AstraZeneca case, where AstraZeneca had been found to have intentionally supplied false information to various Patent Offices in an attempt to obtain IP rights and/or or IP right expiry dates to which it was not entitled. It is worth noting that nothing in the SPC Regulation precludes a company from filing an SPC for a product in one country on the basis of one patent and in another country on the basis of another patent, be it a divisional or a wholly different patent. It is also worth noting that Pfizer never made representations to the Italian Patent and Trade Mark Office about the “nature” of its patent, so that the accuracy of the parallel with AstraZeneca appears to be very limited.

The Italian administrative court had in fact denied that there had been any abuse by Pfizer, noting inter alia that Pfizer's behaviour did not include the “quid pluris” (such as an intentional misrepresentation to the Italian Patent and Trade Mark Office) which is necessary for a finding of abuse.

Contrary to this, the Italian administrative appeal court (Consiglio di Stato) has now held that Pfizer did abuse its dominant position. A few of the points made by the Consiglio di Stato to support this position are quite interesting and will probably spur some debate among the lovers (or haters?) of divisionals.

As a first point, even though during the proceedings relating to this antitrust challenge Pfizer had clearly shown that – as is also inevitably based on the provisions of the SPC Regulation - basing the Italian SPC and paediatric extension on the divisional did not lead to an SPC expiry date different from the one achieved by the other SPCs and paediatric extensions which were based on the parent patent, the Consiglio di Stato does not seem to have appreciated this point, since in the decision the court has emphasized that the divisional patent expired in 2009 whereas thanks to the Italian SPC and paediatric extension the expiry date was postponed to 2012 (evidently not realizing that the comparison had to be made among the various SPCs, or the various paediatric extensions, and not between the patent and the SPC/paediatric extension).

Even more notably, on the point of the actual abuse the Consiglio di Stato held that (our English translation):

“Here, we do not discuss a conduct prohibited by patent law, but the anti competitive implications of a number of acts which, in and of themselves, are legitimate [i.e. obtaining a divisional patent and an SPC]. After all, the abuse of a dominant position, attributed to Pfizer, is nothing but the specification of the broader category of abuse of right, whose precondition is in fact the existence of a right, which then is used in an instrumental manner that is not coherent with the goal for which the law acknowledges it – in this specific case, the exclusion of the competitors from the market.”

At this stage, the question that first springs to mind is what other, legitimate, purpose obtaining a patent and an SPC can serve, for the party that obtains such IP rights, if not that of excluding competitors from the market (after all, patents and SPCs, like all IP rights, are exclusive rights). This answer, at least in the view of the Consiglio di Stato, can probably be found in the following passage of the decision (our English translation):

“In the present case, the behaviour adopted by Pfizer by way of the exploitation of the rights connected with the ownership of the main patent and with the position on the market allowed to defer [the entry into the market] of generics of Xalatan, without entailing any concrete use of the same active pharmaceutical ingredient different from the one already protected. The assessment of the [Italian antitrust] authority, who saw in such behaviour a goal going beyond, and differing from, the one that is specific to the patent protection … is therefore fully justified.”

It will not come as a surprise, after reading this passage, that in at least three other passages of the decision the Consiglio di Stato insists on the fact that the grant of the divisional patent was not followed by the marketing of any new product (Pfizer's Xalatan, comprising latanoprost as the active pharmaceutical ingredient, was already on the market when the divisional patent was granted).

Thus what transpires from the decision is that the Consiglio di Stato considered that, for the divisional patent to be legitimate, it had to be accompanied by the marketing of a new product (falling within the scope of the patent). This is in contrast with the fact that, as said above and by definition, patents are exclusive rights and not a permission, let alone an obligation, for the patent owner to implement the invention in actuality. In addition, this is in contrast with the fact that one and the same product can be validly covered by several patents (Markush formula for the active ingredient, salts, polymorphs, process for making the active ingredient, formulation, process for making the formulation, use for a certain therapeutic indication, etc.), none of which require the marketing of a new product for such patents to be valid and non-abusive.

As far as we know, this decision is one of the few decisions on the interaction between divisional patents and antitrust laws in Europe. In addition, the action was started before the Italian authorities as Pfizer's allegedly abusive behaviour was limited to Italy (given that in most other European countries the SPCs and paediatric extensions were based on the parent patent), but throughout the proceedings the parties relied on the case law of the CJEU in the matter of abuse of dominant position and ruled on the basis of Art. 102 TFEU rather than on the exclusive basis of Italian law. It is thus hoped that, if this decision is cited in the future by other authorities ruling on the same issues, this will be done with a view to clarifying whether the exclusive nature of a patent is, in and of itself, a legitimate reason to own a patent or whether each (divisional) patent must be accompanied by a new product for it to be legitimate also from the point of view of competition law.

Pfizer Xalatan ruling: Consiglio di Stato ruling now available

Last month, in our blog post "Italy: Consiglio di Stato reinstates original Pfizer Xalatan order", here, we hosted a contribution from Gian Paolo Di Santo (Partner NS Head of the I.P./I.T. Department of law firm Pavia e Ansaldo, Milan) on the question of whether Pfizer was in breach of competition law rules in seeking to maximise its protection for latanaprost.

The decision of the Consiglio di Stato (in Italian) was published in full on 12 February and Gian Paolo has kindly provided us with a copy that you can access here or download here. According to Gian Paolo,

"the decision is rather concise and straightforward, mainly recapping the development of the whole procedure and essentially acknowledging that the Authority decision (which was far more detailed) was not affected by any lack of reasoning and that instead the decision of the TAR Latium (first instance administrative Court) failed to understand the very core of the matter. The problem was that, even if the request for a divisional patent was legitimate, this did not allow Pfizer to use such a divisional patent solely for the purpose of excluding its competitors by means of a SPC + paediatric extension requests. Of course one might have expected some more indications from the Supreme administrative Court, but instead they mainly referred to the decision of the ICA and stated that the investigation that took place could not be considered erroneous".

Italy: Consiglio di Stato reinstates original Pfizer Xalatan order

While much of the content of this weblog addresses the technical issues relating to securing an SPC, the scope of the blog extends beyond those issues, covering the economic and commercial dimensions of SPCs, how they are deployed strategically by their owners and how they fare when measured against the yardstick of competition law.

In this context The SPC Blog welcomes the following contribution from Gian Paolo Di Santo (Partner NS Head of the I.P./I.T. Department of law firm Pavia e Ansaldo, Milan).  Gian Paolo is not one of our regular contributors, which makes his contribution all the more welcome to us.  This is what he writes:

In this case, somehow breaking a tradition which sees Italian “old school” lawyers (as I am) who are a bit reticent on contributing to blogs actually discussing their cases on a open stage, I write to report the news that the Consiglio di Stato (i.e. the final decisional body of administrative courts in Italy) has annulled the decision issued by the TAR Latium (i.e. the first instance administrative Court which has jurisdiction over antitrust decisions of the Italian Competition Authority, 'ICA') on the matter concerning the abuse of dominant position put in place inter alia through a misuse of patent/SPC rights in Italy by Pfizer in relation to the Xalatan product. Accordingly, the original order of the ICA which fined Pfizer over 10 million Euros is now final and binding. 

For the time being only the ruling-- allowing the ICA and Assogenerici’s appeal -- is available, while the reasoning for the decision will be published within a few months (and – if it is of any interest – I will be keen to provide readers with better information as soon as they are published) [yes, please, says The SPC Blog. Meanwhile, the ruling can be read here or downloaded here]. However I wanted to be the first to provide you with this information, mainly to avoid the impression that such an important decision is rapidly labelled as the decision of an Italian body which “does not understand of IP”, as I have seen that many commentators did in the past when commenting on this matter. 

It is the first time in Italy in which the misuse of patent law in the pharmaceutical field has been carefully scrutinised in order to assess an abuse of dominant position. The only precedent known to me in Europe had so far been the AstraZeneca case (CJEU decision of December 6, 2012 in case C-457/10P), but this Italian Pfizer case potentially appears even more interesting, as it might give some hints on how competition law may help to tackle unfair practices such as the implementation of the so-called “patent thickets” and “evergreening” policies by the originators, which are practices that had been denounced by the European Commission in its inquiry on the pharmaceutical sector which was concluded on July 8, 2009.

Latanoprost

Some commentators asserted that the decision of the TAR Latium, annulling ICA’s decision, was correct because Pfizer had not actually broken any patent rule, since the strategy they implemented, characterized in particular by the indication of a divisional patent as a basic patent to file a request for SPC, was in accordance with the applicable legislation which allows the filing of divisional applications. It is reasonable, however (awaiting the written reasoning of the decision, expected in the coming months), to think that the Council of State has determined that the object of the ICA’s investigation, and the reasons of the consequent sanction, were not founded on the legality of Pfizer’s conduct under a civil or administrative profile, but rather on the complex strategy put in place by Pfizer in relation to the active principle latanoprost, the verification of its legality under the typical profile of competition law (on the merits), and in particular  the  possible breach of the prohibition of abuse of dominant position set out in Article 102 TFEU.

In other words, the central point of the issue appeared to be that, under antitrust law, the subject in a dominant position cannot engage in conduct that could be perfectly legitimate if performed by a subject that is not in a dominant position. The ICA considered that Pfizer’s overall strategy was unjustifiable unless it was interpreted as having solely an exclusionary intent and purpose. This had nothing to do with the competition on the merits that in the patent/pharmaceutical field should be characterized by making innovative products available to the public.

Pfizer’s defence, in a nutshell, was that all the acts put in place by that company (request of – several – divisional patents all covering the same identical product, request of an SPC using as “basic patent” the last possible of those patents, starting of an aggressive enforcement campaign after the grant of the divisional patent and SPC against the genericists which had prepared themselves to launch after the expiry of the parent patent protecting the active principle as such) were lawful under an IP point of view.

In my opinion one of the central aspects of all this issue is that

" ... in 2002 the situation was crystallised with the expiry of the patent protection expected in Italy in September 2009 (by virtue of the lack of a SPC on the main patent in our country). Accordingly, the generic companies legitimately came to expect they could enter the Italian market on that date. This reliance was frustrated by the exclusionary strategy of Pfizer which applied for the divisional patent exclusively to obtain the SPC to align the expiry of patent protection for Xalatan in Italy with the rest of Europe” (ICA decision, § 197). 

And also Pfizer – as it clearly emerged from the inspection – had already in mind that the LOE (loss of exclusivity) would have taken place in Italy before than in the rest of Europe.

The ICA therefore assessed that the divisional patent had been unlawfully exploited, seeking protection for an active ingredient already protected by a granted and fully valid parent patent and whose related medicinal product had already been authorized since many years, with the sole purpose of using such a divisional patent as a vehicle for the request for an SPC in Italy. Such behaviour was aimed at preventing entrance into the market of competitors at the time of parent patent’s expiry, thus remedying the original "oversight" regarding the application for an SPC, filed for in all other European countries. To confirm the exclusionary nature of Pfizer’s behaviour, the ICA deemed particularly suspicious the fact that no new drug had been placed on the market on the basis of the new EP '168 patent, and that no technological development was achieved in this patent. 

Xalatan was in fact realized, from the moment when it was first placed on the market in the late ‘90s, in Italy and in all other countries where the parent patent EP '417 was extended, with characteristics of dosage and amount of active ingredient per drop (which was the key element of EP '168, applied for only in 2002) that remained unchanged over time. In addition, and this was even more significant to confirm suspicion, the divisional EP '168 was curiously filed only in Italy, hence adopting a different strategy with respect to what had been done with EP '417, which had instead been validated in all European countries.

Apart from the obvious professional joy that I feel after a long battle that lasted over four years, my personal and intimate feeling is that the ICA order of January 2012  as well as the decision of the Consiglio di Stato, as soon as it is published, should be read with careful consideration as it is an occasion to somehow rethink a bit the relation between patent law and competition law.

Patent linkage: has it returned to Italy?

The SPC Blog is again in debt to the kindness of our very good friend Micaela Modiano (Modiano & Partners) for the following information and insight from Italy with regard to patent linkage:

"Only very recently, the Italian Parliament had abolished a provision contained in the Italian IP Code and corresponding to a form of patent linkage.  This provision indicated that an application for a generic marketing authorization could be filed only within the last year of life of the patent or SPC protecting the originator product, also taking into account any paediatric extension filed with respect to the SPC. The abolition of this provision followed from an infringement procedure started by the EU Commission against Italy.

Now, on 8 November 2012, the Italian Parliament has passed a law entitled "Urgent measures for promoting the development of the [Italian] State by way of a higher level of health protection".  Among other things, this law provides that the Italian Regulatory Authority (Agenzia Italiana del Farmaco, AIFA) shall carry out an extraordinary review of the national list of authorized pharmaceutical products, so as to more clearly identify any therapeutically obsolete medicinal products. 

 When carrying out such extraordinary revision, and on the occasion of any subsequent revision of the national list of authorized pharmaceutical products, Art. 11(1) of the new law provides that [per Micaela's English translation]:

 "the medicinal products which are equivalent, according to the law, to medicinal products whose patent or SPCs is yet to expire/about to expire [translator's note: the Italian terms of the law are not clear on this point!] cannot be classified as reimbursed by the Italian national health service prior to the patent or SPC expiry date published by the Ministry of Economic Development [translator's note: this is the Ministry encompassing the Italian PTO] according to the provisions of law."

 The new law therefore does not appear to introduce a patent linkage regarding when a generic marketing authorization should be filed or when it should be granted; nevertheless, the language of Art. 11(1) appears to introduce a patent linkage regarding when a generic product can be reimbursed by the national health service. 

 While the law was under discussion at the Italian Parliament, the Italian Antitrust Authority had sent a formal communication to the Parliament proposing that the provision of Art. 11(1) be abolished given that, in the Authority's own words, such provision "introduces ... a clear form of 'patent linkage'". Despite this comment by the Authority, the provision was maintained and is still part of the new law. 

 The full text of the new law as published in the Italian OJ of November 8, 2012 can be found here.

Art. 11(1) of the new law should be read and assessed also in the context of Art. 14 of the current version of the Proposal for a Directive of the European Parliament and of the Council  relating to the transparency of measures regulating the prices of medicinal products for human use and their inclusion in the scope of public health insurance systems, which can be found here. 

 Interestingly enough, Art. 14 is entitled "Non interference of intellectual property rights...". It will be watching carefully to see how Art. 11(1) of the new Italian law will be reconciled with the text of Art. 14 of this draft directive. 

 Surely this will not be the last we hear regarding Italy and patent linkage!"

Correction -- and apologies!

The link to the English translation of the Italian administrative court decision in the Pfizer case, given in the previous blogpost, led erroneously to a document in Italian and not to the English translation. The translation can be found here and the earlier blogpost will be amended accordingly.

Apologies to everyone who has been inconvenienced.  My only excuse is that I was not sufficiently awake to the perils of late-night blogging!

Italian latanoprost Administrative Court ruling now available in translation

In "Italian u-turn on latanoprost abuse of dominant position dispute" The SPC Blog reported last month on a decision of the Italian Administrative Court in which it vindicated allegedly abusive activity by Pfizer in trying to extend its patent monopoly by filing a divisional application and seeking SPC and paediatric extensions. Now, thanks to Micaela Modiano (Modiano & Partners) and Anna Maria Stein (Franzosi Dal Negro Setti), we have an English translation of this decision, which you can read here. Thanks so much, Micaela and Anna Maria, for your support.

Italian u-turn on latanoprost abuse of dominant position dispute

The SPC Blog is very pleased to thank Micaela Modiano (Modiano & Partners) and Anna Maria Stein (Franzosi Dal Negro Setti),for the following item of news from Italy:

"Recently we reported  he decision of the Italian Antitrust Authority in the latanoprost case. In that decision, the Authority found that Pfizer abused its dominant position as a result of a combination of activities including filing a divisional, validating it only in a part of the designated states, filing an SPC and a paediatric extension based on it and Pfizer's involvement in related litigation in Italy.

Pfizer filed an appeal against this decision. On 3 September 2012 the Italian administrative court competent for this appeal issued its decision on Pfizer's appeal. The appeal decision is very interesting because, while the Italian Antitrust Authority had held that Pfizer's behaviour represented an abuse of dominant position, the Italian administrative court has now decided that this finding is entirely incorrect. In particular, the most noteworthy points of the administrative court decision are -- as regards the issue of abuse of dominant position -- that:

* Pfizer's divisional does not amount to an abusively excluding activity, since it was filed several years before the anticipated market entry of generic companies (i.e. not simultaneously with it), 

* the filing of Pfizer's divisional does not amount to an abusively excluding activity just because it took place when Pfizer realized the more limited protection conferred by the parent patent, 

* contrary to what happened in the AstraZeneca case, Pfizer did not provide the EPO with elusive information when pursuing its divisional, 

* Pfizer's litigation activity was not an abusively excluding activity, given that in most of the relevant litigation Pfizer was actually the defendant rather than the plaintiff, 

* Pfizer's warning letters sent prior to the litigation were not an abusively excluding activity, given that they were sent on the basis of Pfizer objectively having obtained an SPC for Italy; 

* the Antitrust Authority finding is altogether flawed as it appears to be based on the fact that, at the time of the Authority's decision, the divisional patent had been revoked by the EPO Opposition Division, while ignoring that the revocation could be (and was indeed) appealed. That is to say, it was not final at the time, and was indeed overturned by the EPO Board of Appeal.

Thus, while the Italian Antitrust Authority had held that a number of activities which are based on the provisions of the EPC and of the EC SPC and paediatric extension regulations allegedly represented, taken together and in the way in which Pfizer had carried them out, constituted an abuse of Pfizer's dominant position, the Italian administrative court has now held that Pfizer legitimately and non-abusively relied on such provisions simply to obtain the IP rights to which it was entitled.

The new Italian administrative court decision is therefore important as it appears to take away some of the very negative light shed in a blanket-like manner by the Italian Antitrust Authority on divisionals, SPCs and paediatric extensions. The new decision does not necessarily say that one can always and under any circumstance file a divisional, SPC or paediatric extension or sending warning letters or be involved in litigation without ever incurring in anticompetitive behaviour, but it surely says that in this particular case Pfizer merely relied on the available legal provisions to obtain certain rights it was entitled to.

We now wait to discover whether the administrative court decision will now be appealed by the Antitrust Authority"..

For those readers who are actually Italian or read Italian, the original decision is here.  Micaela and Anna Maria are seeing what they can do to get us all an English translation. Thanks!

Court of Rome applies Medeva, suspends provisional relief

From Evelina Marchesoni (Bird & Bird) comes an update to The SPC Blog's recent post on the Italian proceedings on valsartan and hydrochlorotiazide.She writes:

"On 11 November 2011 the Court of Rome granted a preliminary injunction requested by Novartis enforcing its SPC no. C-UB1999P000648, expiring on September 25, 2012 and covering the medicinal product “Cotareg” (valsartan + HCTZ).

In his decision the dudge ordered Mylan to stop manufacturing, commercializing, advertising, distributing, importing, exporting, storing and/or offering in any form (including the request of insertion in the so called “transparency list”) the generic products of Cotareg. 

Mylan appealed against this interim order and, after the issue of the decision of the Court of Justice in Case C-322/10 Medeva and Case C-422/10 Georgetown, sought an application to stay the preliminary injunction pending appeal. 

Mylan pointed out that, also in light of the Court of Justice's ruling, Novartis’s certificate claiming the combination of valsartan and HCTZ was invalid according to Article 3(a) of the Regulation, as it referred to a basic patent, EP 0 443 983, which did not provide such a combination.

By his decision, issued on 25 November 2011, the President of the IP Division of the Court of Rome, considering that on 24 November 2011 the decisions from the ECJ were published and they affirmed that Art.3(a) of the Regulation should be interpreted “as precluding the competent industrial property office of a Member State from granting a supplementary protection certificate relating to active ingredients which are not specified in the wording of the claims of the basic patent relied on in support of the application for such a certificate”, ordered the provisional suspension of the preliminary injunction decision. 

This short decision of the Court of Rome, which you can access in full here (in Italian) probably constituted the first application in Europe of the interpretation of the Court of Justice decisions in the Medeva and Georgetown cases.

Discussion of the appeal is scheduled for 16 December 2011".

Thank you, Evelina, for this information, which is much appreciated.

Valsartan and hydrochlorothiazide combination: Rome rules

From Daniela Ampollini (Trevisan & Cuonzo Avvocati, Parma, Italy) comes information concerning a recent decision of the Court of Rome concerning a Novartis combination SPC, which this weblog reproduces here with grateful thanks:

"On 11 November 2011 the IP Chamber of the Court of Rome granted the motion for preliminary injunction requested by Novartis AG and Novartis Farma S.p.A. against Mylan S.p.A. on the basis of Novartis’ Italian valsartan and hydrochlorothiazide SPC, the active ingredients in Novartis’ Co-Diovan medicinal product (which is marketed in Italy as Co-Tareg). 

The motion had been filed within the context of a nullity action initiated last September by Mylan, aiming at the revocation of Novartis’ SPC for alleged violation the provisions of the SPC Regulation, in which action Novartis had cross-claimed for infringement of its rights. 

The grounds of invalidity raised by Mylan were substantially based on the assumption that: (i) the SPC would be invalid as the medicinal product Co-Diovan would not be “protected by a basic patent in force” considering that the basic patent EP 443983 did not claim the combination of valsartan and hydrochlrorothiazyde as such and that the “infringement test” (according to which a product is protected by a patent if it “infringes” the patent) would not be the correct test to use in interpreting Art. 3(a) of the SPC Regulation; and (ii) Art. 3(c) of the SPC Regulaton would have also been breached by the valsaran and hydrochlorothiazide SPC as another SPC on valsartan had already been granted based on the same EP ‘983 patent. 

The Court of Rome first noted that the urgency requirement had been met sinceNovartis had produced pre-orders, indicating that Mylan had pre-marketed the drug, as well as the fact that Mylan had officially communicated to the association of Italian wholesalers that its generic version of Co-Diovan would be in the market as of 15 November 2011 (i.e. after the expiry of the valartan SPC-- but not after the expiry of the valsartan and hydrochlorothiazide SPC). It then endorsed the application of the infringement test as to Art. 3(a) of the SPC Regulation and clarified that Art. 3(c) was not breached if the products in question (in this case the product valsartan and the combination product valsartan and hydrochlorothiazide) are different, and therefore found that there had been infringement of a valid SPC. 

The injunction is also noteworthy as it includes a prohibition that Mylan make pre-marketing activity (such as the collection of orders and pre-orders) before the expiry of the SPC, an order of recall of the products that have already been delivered to Mylan’s customers, and an order to notify the Italian Drugs Regulatory Authority with a view to preventing the inclusion of the generic in the substitution list of equivalent drugs. 

The preliminary injunction is now subject to appeal and, in any event, to confirmation at the outcome of the merits proceedings".

You can read the court's order in the original Italian here, and in English translation here

SPCs, competition and refusal to supply

SPCs are frequently viewed from the mechanical perspective of the apparently endless sequence of arbitrary steps that have to be taken to secure the formalities that are a necessary condition for extending a patent's life, if not a sufficient one. For this reason it is easy to overlook their interest to competition lawyers.

Two SPC-related items were found on the website of the International Competition Network (ICN) in the context of the Italian Competition Authority's responses last month to a questionnaire on "refusal to deal" -- something that competition lawyers dislike because of its damage to their beliefs in how markets should operate and the philosophy of "everything has its price", but which IP owners regard as part of their patrimony.

The questionnaire sought information on ICN members’ analysis and treatment under their antitrust laws of the refusal of a company to deal with a rival, to give an overview of law and practice in the responding jurisdictions regarding refusals to deal and the circumstances in which they may be considered anticompetitive. "Refusal to deal” is defined as

"the unconditional refusal by a dominant firm (or a firm with substantial market power) to deal with a rival. This typically occurs when a firm refuses to sell an input to a company with which it competes (or potentially competes) in a downstream market. For the purposes of this questionnaire, a refusal to deal also covers actual and outright refusal on the part of the dominant firm to license intellectual property (IP) rights, or to grant access to an essential facility".

"Constructive” refusals to deal, characterized here by a dominant firm’s offering to supply its rival on unreasonable terms (e.g., extremely high prices, degraded service, or reduced technical interoperability) fall within this definition, as does the "margin-squeeze,” which occurs when a dominant firm charges a price for an input in an upstream market, which, compared to the price it charges for the final good using the input in the downstream market, does not allow a rival on the downstream market to compete.

The first SPC reference is to Glaxo - Active ingredients (Italian Competition Authority case A363 Glaxo-Principi attivi, decision n. 15175 of 8 February 2006), published in Bulletin no. 6/2006:

"In February 2006 an investigation into the pharmaceutical group Glaxo concluded with the finding of abusive practices in violation of Article 82 of the EC Treaty. Glaxo refused to grant Fabbrica Sintetici Italiana (FIS), a chemical-pharmaceutical undertaking, a licence to produce an active drug ingredient known as Sumatriptan Succinato, covered in Italy by a supplementary protection certificate, for use in other Member States (in which Glaxo no longer held any patent-rights) in the production of generic drugs known as triptans for the treatment of migraines. The Authority found that Glaxo, in additipn to holding a quasimonopoly on the production of Sumatriptan Succinato worldwide, occupied a dominant position in the Spanish and Italian markets for the production and marketing of triptans sold through hospitals. In these markets Glaxo held a particularly high market-share, equal to about 96% in Italy and 58% in Spain. As for the possibility of access for potential competitors, all the products sold in the markets concerned were found to be covered by industrial patent-rights, which were due to lapse between 2008 and 2012, with the exception of Sumatriptan Succinato which was not covered by any patent in the Spanish market. Based on the investigation’s findings, the Authority deemed that Glaxo’s refusal to grant the requested licence constituted an abuse of dominant position in violation of Article 82 of the EC Treaty, since its refusal hindered the production of an active ingredient needed by producers of generic drugs, potential competitors of Glaxo, to access national markets where Glaxo did not have any exclusive rights. The Authority considered this conduct had no objective justification".

The second SPC reference is Italian Competition Authority case A364 - MERCK-PRINCIPI ATTIVI, decision no. 16597 of 21 March, 2007, published in Bulletin n. 11/2007:

"In A364 Merck the Authority, with a view to ensuring that, pending the outcome of the investigation, Merck’s behaviour would not continue to cause serious and irreparable harm in the markets concerned, adopted interim measures obliging the company to issue without delay – and at least for stockpiling purposes – licences authorising the production in Italy of Imipenem Cilastatina. In accordance with this ruling, in August 2005 Merck issued a license to the chemical firm Dobfar to manufacture this active ingredient, whose Supplementary Protection Certificate expired in January 2006. In November 2006 Merck presented a commitment under Article 14-ter of Law no. 287/1990, offering free licenses to manufacture and sell the active ingredient Finasteride and related generic drugs, even though the Supplementary Protection Certificate does not expire until 2009. The Authority deemed that this commitment was likely to result in the permanent removal of any anticompetitive effects flowing from Merck’s former refusal to grant licences".

Italia and the Certificati Complementari di Protezione

The tour of European countries with SPCs continues. this time reaching Italy: the country with the exceptionally long SPCs which are still alive and well.

Right: Italy leading the pack

As most seasoned readers will be aware, the Certificati Complementari di Protezione (CCP) were introduced in Italy first via Italian law by law number 349/91 (October 1991), and were subsequently replaced by European Regulation 1768/92 (2 January 1993).

The intial Italian CCPs provided for a maximum duration of protection of a whopping 18 years from the date on which the patent reaches the end of its life. It is estimated that between October 1991 and January 1993 roughly 400 active compounds received CCP protection and roughly 190 are still in force. The last CCPs are expected to expire in 2011. Omeprazole still appears to benefit from a CCP (which is set to expire in 2010).

Information on deposited and granted SPCs can be obtained from this website on the website of the Italian Patent Office, unfortunately all in Italian.

Italian SPCs

Our attention was drawn this week to an article in the June 2008 issue of EPI Information, the journal of the Institute of Professional Representatives before the European Patent Office.

In this issue, F. de Benedetti of Italy reports the passing of a bill in the Italian Parliament which clarifies the calculation of the six month annual reduction of the term of SPCs applied for in Italy before 2 January 1993.

Prior to the harmonization of SPC regulations in Europe by Council Regulation 1768/92, Italy enacted its own SPC scheme: the duration of the certificate was equal to the period between filing the patent application and the date of first marketing authorization in Italy as long as this term did not exceed 18 years after the end of the lawful term of the patent. Moreover, this term was to begin on the date of marketing authorization. This patentee friendly scheme was changed in 2002 when a new law was enacted that provided for an annual six month reduction to the term of these pre-1992 SPCs. It however remained unclear how to calculate the term reduction when the remaining term was less than one year.

On 23 February 2008 the Italian Parliament passed a bill containing a provision to clarify calculation of this term reduction. This provision calls for the reduction to be applied to the last year. For example, should the last year's remaining term be less than 6 months, the SPC would expire on 31 December of the previous year. Should the remaining term be more than 6 months, then it will be reduced by 6 months.

According to Mr. de Benedetti, although this provision clarifies an important point of law, there are other points which still remain unclear:

A small number of said SPCs were not yet in force in 2004, when the system
reducing the term by 6 months for each calendar year started to be
applied. It remains to be seen for these cases, whether the subtraction of
6 months should count in any case from the year 2004 or from the year when, upon
the patents expiry, the SPC entered into force.

The SPC blog would be interested in getting a rough estimate of how many SPCs with abnormally long terms are still lurking around in Italy…