Merck and the Specific Mechanism: the Advocate General offers some guidance

Just over a year ago, the Court of Appeal for England and Wales made a reference for a preliminary ruling to the Court of Justice of the European Union (CJEU) in Case C-539/13, Merck Canada Inc., Merck Sharp & Dohme Ltd v Sigma Pharmaceuticals PLC (as noted by The SPC Blog, here). The questions referred are somewhat wordy and relate to the Specific Mechanism -- a derogation from the principle of free movement of goods which was appended to the Act of Accession when a whole batch of new members -- the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovenia and the Slovak Republic -- joined the European Union. 

This Special Mechanism allowed the owner of a pharma patent or an SPC to prevent the parallel importation of the patented product from one of the accession states if, at the time of filing, such protection was unavailable in that accession state; anyone who intended to import such a product was required to demonstrate to the relevant national authority that he had given notice of that intention to the holder or beneficiary of the protection.

The questions read as follows:

1 May the holder, or his beneficiary, of a patent or supplementary protection certificate rely upon his rights under the first paragraph of the Specific Mechanism only if he has first demonstrated his intention to do so? 

2 If the answer to Question 1 is yes:

(a) How must that intention be demonstrated?

(b) Is the holder, or his beneficiary, precluded from relying upon his rights with respect to any import or marketing of the pharmaceutical product in a Member State that occurred prior to the demonstration of his intention to rely upon those rights? 

3 Who must give the prior notification to the holder or beneficiary of a patent or supplementary protection certificate under the second paragraph of the Specific Mechanism? In particular:

(a) Must the prior notification be given by the person intending to import or market the pharmaceutical product?

or

(b) Where. as permitted by the national regulatory system, an application for regulatory approval is made by someone other than the intended importer, can prior notification given by the applicant for regulatory approval be effective if that person does not itself intend to import or market the pharmaceutical product but where the intended importation and marketing will be carried out under the applicant's regulatory approval?;  and

(i) Does it make any difference if the prior notification identifies the person that will import or market the pharmaceutical product?

(ii) Does it make any difference if the prior notification is given and the application for regulatory approval is made by one legal person within a group of companies which form a single economic unit, and the acts of importation and marketing are to be carried out by another legal person within that group under licence from the first legal person, but where the prior notification does not identify the legal person that will import or market the pharmaceutical product? 

4 To whom must prior notification be given under the second paragraph of the Specific Mechanism? In particular:

(a) Is the beneficiary of a patent or supplementary protection certificate limited to persons who have a legal right under national law to bring proceedings to enforce that patent or supplementary protection certification?

or

(b) In a case where a group of companies forms a single economic unit comprising a number of legal entities, is it sufficient if the notification is addressed to a legal entity which is the operating subsidiary and marketing authorisation holder in the Member State of importation rather than the entity within the group that has a legal right under national law to bring proceedings to enforce that patent or supplementary protection certificate, on the basis either that such legal entity may be characterised as a beneficiary of the patent or SPC, or that it is to be expected that such notification in the ordinary course of events will to come to the attention of the persons who make decisions on behalf of the patent or SPC holder?

If the answer to Question 4(b) is yes, 

(c) is a notification which is otherwise compliant rendered non-compliant if it is addressed to the "the Manager, Regulatory Affairs" of a company when that company is not the entity within the group that has a legal right under national law to bring proceedings to enforce that patent or supplementary protection certificate but is the operating subsidiary or marketing authorisation holder in the Member State of importation and when that Regulatory Affairs department in practice regularly receives notifications from parallel importers regarding the Specific Mechanism and other matters?

Yesterday the CJEU's Advocate General offered the following Opinion as to how these questions should be answered:

Questions 1 and 2

A holder of a patent or a supplementary protection certificate, or his beneficiary, duly notified of an intention to import and market pharmaceutical products covered by the Specific Mechanism ... is required to respond to the notification, so as to demonstrate an intention to oppose the proposed importation and placing on the market, within the period prescribed in the second paragraph of the Specific Mechanism, in order to be entitled to enforce any restriction on the import and marketing of the products concerned. A holder of a patent or a supplementary protection certificate, or his beneficiary, is precluded from relying upon his rights with respect to any import and marketing of the pharmaceutical product in a Member State that occurred prior to the demonstration of his intention to rely upon those rights.

Question 3

The notification required under the second paragraph of the aforementioned Specific Mechanism may be carried out by someone other than the potential importer and marketer provided that the identity of the latter is clearly identified by the notifying entity.

Question 4

Prior notification under the second paragraph of the aforementioned Specific Mechanism must be given to a person who has a legal right under national law to bring proceedings to enforce the patent or supplementary protection certificate.

It is now for the CJEU to decide whether to adopt this Opinion, on which it is expected to give a ruling in the next few months.