More pay-days for pharma patents, thanks to Seattle Genetics ruling

Today, in a very short judgment of just 41 paragraphs, the Court of Justice of the European Union (CJEU) confirmed the Advocate General’s Opinion in Case C-471/14 Seattle Genetics Inc, by holding that:

Article 13(1) of Regulation (EC) No 469/2009 concerning the SPC for medicinal products must be interpreted as meaning that the ‘date of the first authorisation to place the product on the market in the [European Union]’ is determined by EU law.

And that is to the provision is to be interpreted as meaning the ‘date of the first authorisation to place the product on the market in the [European Union]’ within the meaning of that provision is the date on which notification of the decision granting marketing authorisation was given to the addressee of the decision.

Many thanks go to Axel Paul Ringelhann for being the first of our readers to spot the ruling.

An early press release from London-based law firm Bristows observes that the ruling will be welcomed by innovative (= patent-owning) pharmaceutical companies, explaining the decision like this:

The issue concerned the duration of supplementary patent protection afforded to the innovative pharmaceutical industry. EU legislation provides the possibility of a supplementary protection certificate (“SPC”) to compensate a patent holder for the erosion of patent protection suffered due to the lengthy regulatory process leading to the grant of marketing authorisation (“MA”). In the EU, no medicinal product may be commercially exploited before the relevant authority has issued an MA.

However, there was confusion as to how the duration of an SPC should be calculated. EU legislation provides that the SPC is to be calculated on the basis of “the date of first authorisation to place the product on the market in the Community”. But what constitutes the date of the first MA? Is it the date when the decision granting the MA is adopted by the relevant authority? Or, is it the date on which the applicant is notified of the decision?

Following a preliminary reference from Austria, the CJEU has cleared all confusion: the relevant date is the date on which the decision is notified to the applicant.

Why will the decision benefit the pharmaceutical industry?

Not only has the CJEU’s ruling put an end to the uncertainty faced by both the innovative and generic pharmaceutical industries regarding the duration of effective patent protection afforded to medicinal products, the additional two to five days typically seen between grant of an MA and notification to the applicant can be of significant commercial value. This is particularly so as the market for a medicinal product will often reach its peak towards the end of the patent term. Taking this into consideration, the additional days per product, in every member state in which the product is marketed, potentially multiplied by several products is not insignificant!

Furthermore, although the SPC regime is harmonised throughout the EU, patents remain a national right and SPCs are granted by national patent offices. Following the CJEU’s ruling, divergence should no longer exist between member states regarding the relevant date for calculation of the SPC term allowing patent holders to be certain of a uniform SPC duration throughout the EU and, similarly, allowing competing generic companies certainty as to when patent protection will expire.

There follows a quick word from Mark Sandbaken, VP, Intellectual Property for Seattle Genetics, who was clearly quite chuffed by the decision:

“The CJEU’s ruling will benefit all those at Seattle Genetics, its partner Takeda, and other companies who have invested significant time and efforts in the development of many innovative products that benefit patients. Seattle Genetics is grateful to the Commission and those member states that submitted written observations in support of Seattle Genetics’ position and for the timely response from both the Advocate General and CJEU on this matter”.

Representing Seattle Genetics, Marie Manley (Partner and Head of Bristows' Regulatory Practice added:

“This is a decision of significant importance for the innovative pharmaceutical industry which invests millions in developing a medicinal product. As such, the duration of SPC protection is essential for their medicinal products. Importantly the decision provides certainty to both innovative and generic pharmaceutical companies by clarifying when SPCs expire”.

The Neurim hearing: an eye-witness account

Francisco Bernardo Noriega (Partner, ABG Patentes, Madrid) is a patent attorney who works mainly in the field of pharmaceuticals. He recently attended the hearing before the Court of Justice of the European Union (CJEU) in the Neurim referral (Case C-130/11; see earlier SPC Blog posts here, here and here) which, in his view, deals with a number of interesting issues of SPC law. The case, he notes, is being closely followed by interested parties, as was evident by the surprisingly high number of members of the public attending in Luxembourg, including people from the pharmaceutical industry, solicitors and attorneys. This is what he writes:

“On 15 March 2012, the CJEU heard parties in connection with the C-130/11 Neurim Pharmaceuticals preliminary reference from the Court of Appeal for England and Wales. The reference concerns the interpretation of Articles 3(d) and 13 of the SPC Regulation (EC Regulation 469/2009) and, more particularly, the circumstances in which these Articles mean that an earlier marketing authorisation (“MA”) precludes an SPC based on a subsequent MA. In making the reference, the Court of Appeal had endorsed Neurim’s arguments in strong terms (“We consider that Neurim’s arguments are not only tenable: in our view they are right”), holding that Articles 3(d) and 13 should not preclude Neurim’s SPC, but that Neurim’s arguments needed endorsement by the CJEU:

“In short, if Neurim are wrong, then the Regulation will not have achieved its key objects for large areas of pharmaceutical research: it will not be fit for purpose. Whether that is so or not is clearly a matter for the EU’s highest court.”

Neurim, the UK Government, the Portuguese Government and the Commission appeared at the hearing in front of five judges (Jean-Claude Bonichot, Konrad Hermann Theodor Schiemann, Camelia Toader, Alexandra Prechal and Egidijus Jarašiunas) with Verica Trstenjak as the Advocate General.

Neurim and the Commission were united in arguing that an earlier MA should be taken into consideration (under Article 3(d) or Article 13) only if its subject-matter is within the scope of the basic patent (with reference to Article 4 which limits the scope of the SPC to being no broader than the basic patent). Both parties referred to the underlying scheme and objectives of the Regulation, highlighting the importance of incentivising the type of research which Neurim had undertaken and the consequences of not providing such incentives. They also drew distinctions over the existing case law (C-31/03 Pharmacia, C-431/04 MIT and C-202/05 Yissum etc.); they also emphasised that Neurim’s proposal for the operation of Articles 3(d) and 13 has never before been the subject of a CJEU judgment, and would allow the SPC regulation to meet its purpose, as defined in the recitals.

Neurim also referred to Recital 14 of Regulation 1610/96 (which is explicitly valid under Recital 17 for interpreting the medicinal product SPC Regulation), pointing out that failure to find in Neurim’s favour would deprive Recital 14 of its effet utile. Recital 14 states that an SPC can be granted for a patented salt even if there is an earlier SPC for the same active substance which would, were it not for Recital 14, block the second SPC (because, in such a case, the two active ingredients (“products”) are the same). In making this argument, Neurim referred to C-392/97 Farmitalia to demonstrate that one salt of a particular active ingredient is considered as having the same active ingredient (“product”) as another salt of the same active ingredient (or indeed the active ingredient in its non-salt form). Thus Neurim argued that Recital 14 could not operate properly if the CJEU rejected Neurim’s arguments because, if Neurim’s arguments were rejected, there would be situations where an earlier MA necessarily precludes an SPC based on a subsequently patented salt.

The UK argued that the CJEU has to find against Neurim because the CJEU’s existing case law constrains it from reaching any other conclusion. The UK referred in particular to C-31/03 Pharmacia, C-431/04 MIT and C-202/05 Yissum in addition to the recent cases of C-195/09 Synthon and C-322/10 Medeva. On Medeva, the UK argued that because the CJEU permitted an SPC to be based on an MA which refers to active ingredients (“A + B”) not specified within the scope of the patent (to “A”), it follows that Neurim is wrong. In reply, Neurim argued that the CJEU’s comments in Medeva (which formed the basis of the C-422/11 Novartis reasoned order) are entirely consistent with Neurim’s position because the CJEU confirmed that an SPC to “A” can be used to oppose “A + B” (i.e. “A + B” is within the protection conferred by an SPC to “A”, in accordance with patent law). On Synthon, the UK relied on the comments in AG Mengozzi’s opinion, and both the Neurim and the Commission put forward counterarguments.

The UK and Portugal also argued that Neurim’s approach could lead to evergreening. Both Neurim and the Commission disagreed, highlighting that any SPC granted under Neurim’s approach (which requires the basic patent not to extend to the subject-matter of the earlier MA) could not, by reference to Article 4, cover the subject-matter of the earlier MA. They therefore argued that the second SPC could not prevent the free movement of the earlier-authorised medicinal product within the European Community.

The Portuguese Government also considered that SPC availability in cases like Neurim would be contrary to TRIPS.

Neurim also argued that, if the CJEU answers the first three referred questions against it, then an SPC should nonetheless be allowed in those cases where the subsequent formulation/use requires a full marketing approval dossier (“Initial/Global Marketing Authorisation” according to art. 6(1) Directive 2001/83). Neurim highlighted the distinction between Initial/Global Marketing Authorisations as defined under European Pharmaceutical regulation and other authorisations which merely involve variations (and which, unlike an Initial/Global Marketing Authorisation, do not give rise to data exclusivity periods). This is reflected in the fourth question referred to the CJEU.

The Advocate General’s opinion is expected in May 2012, with the actual judgment of the Court likely to be issued several months later".

Thanks so much for this note, Francisco, which paints a colourful picture of the positions taken in this intriguing reference.

"Déjà vu at the ECJ?": a note on Neurim

"Déjà vu at the ECJ?" is a Current Intelligence note by patent attorneys Mike Snodin and John Miles (Potter Clarkson LLP, United Kingdom) on Neurim Pharmaceuticals (1991) Ltd v The Comptroller-General of Patents [2011] EWCA Civ 228, 3 February 2011 (on which see The SPC Blog here and here).  This note is published in the Journal of Intellectual Property Law & Practice (2011) 6 (8): 513-515.  Its salient points are reproduced here:

"The Court of Appeal for England and Wales (CA) has referred questions to the Court of Justice of the European Union (ECJ) on whether a supplementary protection certificate (SPC) can be obtained for active ingredients which have previously been authorized for a different use. Although the ECJ may well feel that it has considered this issue previously, the case again highlights weaknesses of the legislation governing SPCs, and has even prompted the CA to question whether it is fit for purpose.
...

The precise questions referred by the CA have not previously been considered by the ECJ. However, similar factual situations have been the background to earlier references to the ECJ in respect of Pharmacia Italia, MIT and Yissum cases (cases C-31/03, C-431/04 and C-202/05, respectively).

In particular, the Pharmacia Italia case led to the ECJ deciding that an earlier veterinary MA for a formulation containing cabergoline was prejudicial to the grant of a SPC based upon the first MA for a human use of cabergoline. Although the decision in Pharmacia Italia related specifically to the transitional provisions of the legislation (Article 19(1) of Regulation 1768/92), another ECJ decision (case C-127/00, Hässle) has made it clear that the words “first marketing authorisation” must take the same interpretation for all provisions of the SPC legislation.
...

Underlying referral of questions in Neurim appears to be the CA’s perception that there is an injustice in not awarding an SPC to the holder of a patent for a new (and non-obvious) use of a previously authorized substance which is the subject of a new MA. In this respect, it will be interesting to see how the ECJ answers the questions referred. To date, the ECJ has interpreted Article 3(d) in a manner that takes no account of the perceived injustices outlined by the CA. Instead, it has simply adopted a ‘one bite of the cherry’ approach, in which the availability and term of all SPC protection for an active agent is based upon the first MA issued for that active agent (for any human or veterinary use).
....

If Neurim succeeds in persuading the ECJ that Article 4 should be taken into account when interpreting the term ‘first marketing authorization’ in Article 3(d) of Regulation 469/2009, this would significantly increase the number of patents to (approved) second medical uses that might qualify for SPC protection.

Success for Neurim based only on its potentially most persuasive arguments (relating to the regulatory burden faced by those seeking the first ever authorization for a human use of an active agent) would have a more limited impact: the relevance of the decision might be restricted to only those factual situations where the existence of one or more earlier MAs for certain uses does not in any way reduce the regulatory burden for the sponsor of (pre-)clinical trials for a different, separately patented use.

However, it is far from certain that Neurim will succeed in relation to any of its arguments. Success depends upon persuading the ECJ to depart completely from the logic applied in previous ECJ decisions relating to Article 3(d).

In any event, the case will be watched closely by SPC aficionados, as a decision completely adverse to Neurim could lead to questioning whether the legislation is fit for purpose, or even to calls for its complete overhaul".

... and Neurim too!

On Friday The SPC Blog advised readers that they had an opportunity to make comments to the UK government on Case C-630/10 University of Queensland, CSL Ltd v Comptroller-General of Patents, Designs and Trade Marks. Now it's the turn of Case C-130/11 Neurim v Comptroller General of Patents, another of the current batch of references to the Court of Justice of the European Union for a preliminary ruling (see earlier SPC Blog posts here and here).

If you'd like to comment on this reference, please send your observations to Policy by 6 May by email.

More on melatonin: the arguments and the questions

Further to The SPC Blog's earlier post here on Neurim v Comptroller General of Patents, we are grateful for Edward Oates (Carpmaels & Ransford) for penning this explanatory note which provides rather more background:

"The reference arises from the refusal of the Intellectual Property (IPO) to grant an SPC in respect of Circadin, a patented formulation of melatonin for use in treating sleep disorders by oral administration to human patients over 55. To obtain its marketing authorisation, Circadin was treated as a new chemical entity by the regulatory authorities on account of the fact that melatonin had not previously been approved for use in humans and, therefore, a full stand-alone application for marketing approval consisting of pharmaceutical and pre-clinical testing results and clinical trial data was required in accordance with Article 8(3) of Directive 2001/83/EC. As a result, 15 years of the life of the basic patent for Circadin had passed before Circadin obtained marketing approval. 

The basis of the refusal of the SPC application by the IPO was that, although Circadin was the subject of a basic patent in force, and hence satisfied Article 3(a), there was an earlier marketing authorisation in the hands of a third party for a different formulation of melatonin called Regulin for regulating the reproductive capacity of sheep by subcutaneous administration behind the ears of ewes to be mated. 

Regulin was the subject of its own patent which did not extend to Circadin, and the Circadin basic patent did not extend to Regulin. Nevertheless, the IPO held that, because each formulation contained melatonin as an active ingredient, the earlier marketing authorisation for Regulin was the first relevant marketing authorisation under Article 3(d) and hence the SPC application which relied on the Circadin MA was refused. The IPO argued that its position followed from Pharmacia, MIT and Yissum. It said that Neurim could have been granted an SPC based on the Regulin MA even though the SPC would initially have been of “zero scope” under Article 4 since the subject-matter of the Regulin authorisation was not within the limits of protection of the basic patent. 

Neurim argued that an authorisation should be considered relevant under Article 3(d) (and, by extension, Article 13) only if it were an authorisation in respect of subject-matter that would have infringed the SPC under Article 4. In other words, only if the earlier authorisation allowed its holder to work within the scope of the patent should the authorisation count under Articles 3(d) and 13. Neurim found legislative basis for this approach in Recital 14 of the plant protection product SPC Regulation, and argued that the approach is in line with the purpose and objectives of the regulation as well as some existing jurisprudence from national courts. Neurim argued that, for various reasons, it is wrong to extrapolate from Pharmacia, MIT and Yissum to its case. Neurim also based a further argument on the fact that the Circadin MA required a full stand-alone application in accordance with Article 8(3) of Directive 2001/83/EC.".

Following Lord Justice Jacob's question as to whether the Directive is fit for purpose, the Court of Appeal is asking the following, somewhat more pertinent questions of Europe's highest court:

1. In interpreting Article 3 of Regulation EEC No. 1768/92 [now Regulation (EC) No. 469/2009] (“the SPC Regulation”), when a marketing authorisation (A) has been granted for a medicinal product comprising an active ingredient, is Article 3(d) to be construed as precluding the grant of an SPC based on a later marketing authorisation (B) which is for a different medicinal product comprising the same active ingredient where the limits of the protection conferred by the basic patent do not extend to placing the product the subject of the earlier MA on the market within the meaning of Article 4? 

2. If the grant of the SPC is not precluded, does it follow that in interpreting Article 13(1) of the SPC Regulation, “the first authorisation to place the product on the market in the Community” needs to be an authorisation to place a medicinal product on the market within the limits of the protection conferred by the basic patent within the meaning of Article 4?

3. Are the answers to the above questions different if the earlier marketing authorisation has been granted for a veterinary medicinal product for a particular indication and the later marketing authorisation has been granted for a medicinal product for human use for a different indication?
4. Are the answers to the above questions different if the later marketing authorisation required a full application for marketing approval in accordance with Article 8(3) of Directive 2001/83/EC (formerly a full application under Article 4 of Directive 65/65/EEC)? 

5. Are the answers to the above questions different if the product covered by authorisation (A) to place the corresponding medicinal product on the market is within the scope of protection of a different patent which belongs to a different registered proprietor from the SPC applicant?"

We all keenly await the answers.

Of man and sheep: melatonin saga goes to the ECJ

Looking for a market authorisation, dearie?

In December 2009 a hearing officer at the UK's Intellectual Property Office refused Neurim's application for a supplementary protection certificate for the use of melatonin to correct a distortion or deficiency in the plasma melatonin profile of a human subject. Why? Because the cited marketing authorisation was not the first authorisation to place melatonin on the market as a medicinal product: there was an earlier authorisation to another company for a composition comprising melatonin for use in sheep to initiate an early breeding season -- an authorisation that had nothing whatever to do with Neurim's research or its resulting patent.

Neurim's appeal to the High Court at [2010] EWHC 976 (Pat) was dismissed. Mr Justice Arnold considered the matter acte clair but, considering that there was a tenable argument to the contrary that might lead to a reference for a preliminary ruling, he gave permission to Neurim to appeal to the Court of Appeal.

This morning the Court of Appeal for England and Wales did indeed decide to refer Neurim Pharmaceuticals (1991) Ltd v Comptroller General of Patents [2011] EWCA Civ 228, not yet available on BAILII,  freshly available on http://www.bailii.org/ew/cases/EWCA/Civ/2011/228.html, to the Court of Justice for a preliminary ruling, this being the fifth SPC reference awaiting that court's attention. Delivering the judgment of the court, Lord Justice Jacob had this to say:

"28. ... Pharmaceutical research is not confined to looking for new active compounds. New formulations of old active substances are often sought. Most are unpatentable but from time to time a real invention is made and patented.

29. Moreover there is much endeavour to find new uses for known active ingredients. The European Patent Convention 2000 has indeed made the patenting of inventions in this area clearer. Its effect is that a patent for a known substance or composition for use in a method of treatment is not to be regarded as old (and hence unpatentable) unless use for that method is known. It would be most unfortunate if second medical use patents could not get the benefit of an SPC.

30. In short, if Neurim are wrong, then the Regulation will not have achieved its key objects for large areas of pharmaceutical research: it will not be fit for purpose. Whether that is so or not is clearly a matter for the EU’s highest court".

Synaptech: here comes the Hearing

Mark your diaries! Next Thursday, 17 February, is a big day for SPCs in the European Union. That's the day that the Court of Justice of the European Union is hearing Case C-427/09, Generics (UK) Ltd v Synaptech Inc, a reference for a preliminary ruling from Court of Appeal, England and Wales, on 28 October 2009.  The reference was made just days before Generics (UK) Ltd rebranded as Mylan.

The questions that the Court has been asked to give its ruling on are these:

"For the purposes of Article 13(1) of Council Regulation 1768/92 [concerning the creation of a supplementary protection certificate for medicinal products OJ L 182, p. 1], is the "first authorisation to place the product on the market in the Community" the first authorisation to place the product on the market in the Community which was issued in accordance with Council Directive 65/65 [on the approximation of provisions laid down by Law, Regulation or Administrative Action relating to proprietary medicinal products OJ 22, p. 369] (now replaced with Directive 2001/83 [on the Community code relating to medicinal products for human use OJ L 311, p. 67]) or will any authorisation that enables the product to be placed on the market in the Community or EEA suffice?

If, for the purposes of Article 13(1) of Council Regulation 1768/92, an "authorisation to place the product on the market in the Community" must have been issued in accordance with Directive 65/65 (now replaced with Directive 2001/83), is an authorisation that was granted in 1963 in Austria in accordance with the national legislation in force at that time (which did not comply with the requirements of Directive 65/65) and that was never amended to comply with Directive 65/65 and was ultimately withdrawn in 2001 to be treated as an authorisation granted in accordance with Directive 65/65/EEC for that purpose?"

This blog notes that it has taken 18 months to get from the reference to the Hearing. In better times, by 18 months we might have expected to be well beyond that, taking delivery of the Advocate General's Opinion.