Back to the old normal?

Let me first start by wishing that all readers are safe and well, in these exceptional and difficult times.

As so many of us have to remain home all day in the foreseeable future, with the dreadful pandemic newsfeed as a main distraction, I said to myself, what better way to take my mind off it than to write about… a pharma case?

And so, here is an update on the Inegy® patent dispute (judgment kindly provided by Denis Schertenleib).

Difficult to think about anything else these days.

One year ago, Lionel Vial and I reported on a preliminary injunction ordered against Mylan due to the likely infringement of SPC FR05C0040 owned by Merck Sharp & Dohme Corp. (MSD).

In that post, we expressed some surprise at the decision since, back in April 2018, a judge in charge of emergency interim proceedings had refused to issue a preliminary injunction against another generic drug company, Biogaran, based on the same SPC, because the latter was considered likely invalid, which was confirmed on appeal on June 26, 2018 (see this post).

We wondered whether there was thus a new, more patentee-friendly trend in France with respect to preliminary injunctions in general and pharma patent litigation in particular, which is why the March 2019 post was entitled The new normal.

But now, we seem to be back to the old normal, as the Cour d’appel has overturned the preliminary injunction, and effectively re-raised the bar for pharma patent holders. 

As a reminder, Inegy® is a combination of ezetimibe and simvastatin, which is prescribed for reducing cholesterol levels.

Ezetimibe reduces intestinal absorption of cholesterol while simvastatin (belonging to the family of statins) is an HMG-CoA reductase inhibitor which inhibits cholesterol biosynthesis.

MSD’s SPC protecting Inegy® is based on European patent EP0720599 (EP’599) for the product “ezetimibe optionally in the form of its pharmaceutical acceptable salts in combination with simvastatin”.

EP’599 specifically claims:

  • a very broad family of compounds in claim 1 (in the form of a Markush formula);
  • ezetimibe as a specific compound in dependent claim 8; and
  • a pharmaceutical composition for the treatment or prevention of atherosclerosis, or for the reduction of plasma cholesterol levels, comprising an effective amount of the above compounds, alone or in combination with a cholesterol biosynthesis inhibitor selected from the group consisting of lovastatin, pravastatin, fluvastatin, simvastatin, CI-981, DMP-565, L-659,699, squalestatin 1 and NB598, in a pharmaceutical acceptable carrier (claim 17).

On October 17, 2017, Mylan initiated nullity proceedings, to which MSD responded by requesting, on November 30, 2018, that a preliminary injunction to stop selling Mylan’s ezetimibe/simvastatin combination and to pay provisional damages be issued against Mylan.

On March 7, 2019, the judge in charge of case management (JME) granted the preliminary injunction. Mylan appealed, and the JME’s judgment has now been overturned by the Paris Cour d’appel on February 14, 2020.

Like in first instance, Mylan argued that the SPC was invalid because:

  • It was granted for a combination which is not protected as such by the basic patent, in breach of Article 3(a) of the SPC regulation (No. 469/2009), since it does not form the core inventive advance of the patent, which is centered on ezetimibe, in particular in the absence of any research conducted on the ezetimibe/simvastatin combination.
  • The product protected by the basic patent was already the subject of a certificate (i.e. SPC FR03C0028 granted for ezetimibe) in breach of Article 3(c) of the SPC regulation.
  • As is usual in SPC-related cases, the court analyzed the relevant case law from the CJEU. But the court interpreted the Gilead decision (C-121/17, Teva UK Ltd. et al. vs. Gilead Sciences Inc.) differently from the JME at first instance.

According to Gilead:

Article 3(a) of [the SPC regulation] must be interpreted as meaning that a product composed of several active ingredients with a combined effect is ‘protected by a basic patent in force’ within the meaning of that provision where, even if the combination of active ingredients of which that product is composed is not expressly mentioned in the claims of the basic patent, those claims relate necessarily and specifically to that combination. For that purpose, from the point of view of a person skilled in the art and on the basis of the prior art at the filing date or priority date of the basic patent:

the combination of those active ingredients must necessarily, in the light of the description and drawings of that patent, fall under the invention covered by that patent, and

each of those active ingredients must be specifically identifiable, in the light of all the information disclosed by that patent.

The Cour d’appel held that the conditions of Gilead are not automatically met merely because the claims of the patent explicitly mention the active ingredients of the combination product. Something more is required.

The court insisted on the the link between the claimed combination and the technical problem at stake, based in particular on reason 48 of Gilead, which reads: “it is necessary to ascertain whether a person skilled in the art can understand without any doubt, on the basis of their general knowledge and in the light of the description and drawings of the invention in the basic patent, that the product to which the claims of the basic patent relate is a specification required for the solution of the technical problem disclosed by that patent“.

The court also turned to earlier decisions of the CJEU, namely Sanofi (C-443/12, Actavis Group PTC EHF & Actavis UK Ltd v. Sanofi) and Boehringer (C-577/13, Actavis Group PTC EHF & Actavis UK Ltd v. Boehringer Ingelheim Pharma GmbH & Co. KG) and found that the facts of the present case are similar to those of these earlier decisions.

Here is the court’s summary of Mylan’s key argumentation:

Mylan argues that the basic patent lists a large number of products, namely all known cholesterol-lowering products to be combined with the new active compound ezetimibe, that it does not contain any information on the specific effects of these combinations, and in particular the one associating ezetimibe with simvastatin, and that this combination is therefore not a product distinct from ezetimibe alone, for which the patentee has already obtained an SPC, which would make it possible for them to prohibit the sale of ezetimibe combined with any other product, so that the [SPC] is likely invalid.  

And here is the summary of MSD’s rebuttal:

MSD argues that [the expressly designated] composition of ezetimibe and simvastatin necessarily pertains to the invention for the skilled person, in keeping with Gilead. They add that this combination product is not a mere juxtaposition of two known active substances; it effectively makes it possible to solve the technical problem stated in the patent, namely the development of more effective drugs in the treatment and prevention of atherosclerosis, avoiding side effects, in view of the complementary modes of action of ezetimibe and simvastatin; and that this is a second invention of the EP’599 patent, covered by this patent under article 3(a) of the regulation, so that this case is different from Sanofi and Boehringer. They add that the combination product of ezetimibe and simvastatin has not given rise to an SPC under article 3(c) of the regulation yet, that several products can be protected as such by a basic patent, and that the condition of article 3(c) is also met so that the SPC is valid. 

In summary of the summaries: for MSD, there are two inventions in the basic patent, namely ezetimibe on its own, and the combination of ezetimibe with other complementary drugs such as simvastatin; for Mylan, the patent is only about ezetimibe itself.

In order to decide between these two propositions, the court looked at the structure of the basic patent, and at the nature of the combined effect of the two active substances.

Concerning the structure of the patent, the court noted that the summary of the invention primarily focuses on the class of compounds to which ezetimibe belongs. And then:

[…] The next paragraphs 15 to 17 which disclose product compositions and notably the association of a hydroxy substituted azetidinone and a cholesterol biosynthesis inhibitor are introduced by the following wording: “in still another aspect, the present invention relates to a pharmaceutical composition” or “the present invention also relates to”, so that the skilled person could consider the combination […] as being another “aspect” of the invention relating to hydroxy substituted azetidinones, and not a distinct invention. 

That sounds like a fair point, but on the other hand, it should scare the hell out of all patent drafters that an apparently innocuous choice of wording can have such dramatic consequences more than 25 years after the patent was drafted.

Concerning the “combined effect” of the active substances (an expression used at paragraph 53 of the reasons of Gilead), the court noted the following:

MSD states in its submissions that the “combined effect” under Gilead of the association of ezetimibe and simvastatin lies in the fact of not having to administer the maximum dose of statin and reducing the risk of side effects. This is not mentioned in the patent, which indifferently mentions that the effect of both hydroxy substituted azetidinones alone and their combination with a cholesterol biosynthesis inhibitor is the “treatment and prevention of atherosclerosis”. Therefore, the skilled person, who knew from the prior art that it was possible to combine two anti-cholesterol substances having different modes of action […] and who knew statins and especially simvastatin, in use since the end of the 80s for the treatment of hypercholesterolemia, would not consider that this combination is a distinct product of the patent (in the absence of any indication at the filing date as to the combined effect of ezetimibe and simvastatin, and the results from later research not having to be taken into account) […].

Consequently, the court seems to consider that, in order for a combo drug to be considered as distinct from a mono drug in a patent, this needs to be stated in the patent itself, and there must be a specific effect for the combination disclosed in the patent.

It remains an open question whether a mere mention of a specific combined effect would suffice or whether the combined effect would have to be plausible at the filing date (by analogy with the requirements of sufficiency of disclosure).

The above will probably be controversial enough, but an additional point made by the court, after concluding that the validity of the SPC was seriously challenged, may be even more controversial. To wit:

At any rate, the proportionality of the measures ordered at first instance is not justified in view of the respective interests relating to originator and generic drugs having obtained marketing authorizations. A financial harm cannot be seen as non-repairable or even poorly repairable, as long as it can later be cured by a damages award, unless under exceptional circumstances which are not justified in the present case, as the SPC at stake expired on April 2, 2019, i.e. less than two months after the preliminary injunction order.   

Just like in the latest post on this blog (in the context of telecom SEP litigation), the proportionality principle has thus been emphasized by the court, which seems to be a tendency on the rise. And just like in this other case, the fact that the expiry date of the IP at stake was nigh was a factor taken into account in the proportionality assessment.

This must be very worrying for originators, as preliminary injunctions have been a powerful deterrent for competitors, and as there are concerns that damages may never completely compensate for the competitive advantage gained by generic drug companies launching before expiry.

The case on the merits is probably going on in parallel, so we will probably get further updates on this case.

As a final note, a very similar decision was issued on the same day, with Sandoz instead of Mylan as the generic defendant.


CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 2, February 14, 2020, SAS Mylan v. Merck Sharp & Dohme Corp. & SAS MSD France, RG No. 19/06114.

IPCom-tinuation

Traditionally, patent litigation has a tendency to endlessly drag on.

Think about the pravastatin case in France for example (which I am not brave enough to keep reporting on).

But some cases are really fast movers. Such is IPCom v. Lenovo. In my previous post, published a couple of weeks ago, I reported on the anti-anti-suit injunction issued by the judge in charge of emergency interim proceedings (juge des référés) on November 8, 2019.

The ink on the post was barely dry, or its pixels were barely on, or whatever the right metaphor is, that the Paris Cour d’appel issued its ruling further to Lenovo’s appeal against the November 8 judgment (first brought to my attention by Jérôme Tassi on LinkedIn).

For a detailed summary of the facts of the case, please refer to the previous post.

For the most part, the appeal judges agreed with the juge des référés.

They confirmed that she had jurisdiction over the petition filed by the would-be licensee / infringement defendant Lenovo under article 46 Code de procédure civile, as IPCom would suffer a potential harm in France if the anti-suit injunction were issued in the U.S., affecting IPCom’s right to sue in France.

They also held that the anti-suit injunction, if issued by the Californian judge, would be a manifestly unlawful disturbance, in view of the French courts’ exclusive jurisdiction on matters of infringement of patent rights on the French territory, and in view of the property rights and the right to a fair trial enshrined in the European Convention on Human Rights and in the Charter of Fundamental Rights of the European Union. This was true even if the potential anti-suit injunction was only temporary. Therefore, the juge des référés was right when she ordered Lenovo to withdraw the motion for anti-suit injunction in the U.S.

However, the court canceled the second part of the référé order, which prohibited Lenovo from filing any other similar motion in front of any foreign court. This is because there is no longer any such motion currently pending, and no indication that a similar motion would be filed again. Therefore, the above manifestly unlawful disturbance has ceased and there is no imminent threat of the same.

In summary, there is formally no more anti-anti-suit injunction in place in France. But since the court agreed with the juge des référés‘ assessment, it would probably be unwise for Lenovo to give it another try.

But this is not the only development of the case that I would like to report on.

An even more interesting twist is that, in parallel to the ongoing FRAND determination lawsuit in the U.S., IPCom sued Lenovo (et al.) for patent infringement in France based on EP 1841628 (hence, of course, the anti-suit discussion in the first place). In addition to the action on the merits, IPCom also filed a motion for preliminary injunction (PI) in front of the juge des référés (not the same one as the one who issued the anti-anti-suit injunction, mind you).

On January 20, 2020, the judge issued his judgment, rejecting IPCom’s motion for PI.

I will skip the first part of the judgment, which deals with an alleged invalidity of the complaint – the argument did not work but is worth looking at if only to have the pleasure of reading a reference to the ordinance of Villers-Cotterêts of 1539, the oldest piece of legislation still in force in France, enacted more than 250 years before the monarchy started losing its head.

I will also skip the second part of the judgment, in which Lenovo disputed IPCom’s standing to sue, challenging the chain of transfer of the patent and the recordal of this chain of transfer with the French patent register. This objection was also rejected by the judge.

No, the real interesting part is the discussion on the merits of IPCom’s motion.

Remarkably, the judge heavily relied on the Enforcement Directive (2004/48/EC) and more specifically on the 22nd recital:

It is also essential to provide for provisional measures for the immediate termination of infringements, without awaiting a decision on the substance of the case, while observing the rights of the defence, ensuring the proportionality of the provisional measures as appropriate to the characteristics of the case in question and providing the guarantees needed to cover the costs and the injury caused to the defendant by an unjustified request. Such measures are particularly justified where any delay would cause irreparable harm to the holder of an intellectual property right.

Although the Code de la propriété intellectuelle does not explicitly mention this principle of proportionality of provisional measures, the judge considered that it does apply.

And in the present case, he considered that this proportionality principle would be breached if the preliminary injunction was ordered as requested by the patent proprietor.

Is there a proportionality issue here?

Here are a couple of important facts to bear in mind in this case.

First, the EP’628 patent was declared as essential for the UMTS (3G) standard. Therefore, it is supposed to be implemented by all laptops, mobile phones and tablets of the defendants (marketed under the brands Lenovo, ThinkPad and Yoga). The motion for PI accordingly targeted all of these devices.

Second, the EP’628 patent was set to expire on February 15, 2020. Therefore, the PI, if issued, would just last for a few weeks.

The judge stated that the PI would be justified if IPCom could demonstrate that the infringement of the patent was likely, but also that the absence of a PI would cause harm which could not be repaired by damages. The judge further stated that the negative economic consequences for the defendants should also be taken into account, and more specifically whether they could be adequately repaired if the patent were ultimately found invalid or not infringed.

IPCom argued that it would suffer irreparable harm in the absence of a PI due to the annihilation of the value of its patent portfolio.

The judge was unpersuaded, as IPCom cannot lose any market share, because it does not market any devices. The sole harm suffered by IPCom is the lack of license revenues, which can be repaired by damages to be set by the court at a later stage.

The judge further noted that a PI would have long-lasting effects on the market even after the upcoming expiry of the patent on February 15, 2020, since the public would turn away from the Motorola, Lenovo, ThinkPad and Yoga devices. The loss of income would thus be very large. In addition, a recall of products from the market would tarnish the corporate image of the defendants in the long run and significantly disrupt distribution networks. In short, the PI and recall of products from the market would result in negative economic consequences which could not be adequately repaired by damages, if IPCom were to ultimately not prevail on the merits.

The judge’s conclusion was the following:

[…] The requested measures, set to last for a few weeks in view of the expiry date of the patent of February 15, 2020, are manifestly disproportionate and may result in an imbalance in the situation of the parties conferring an undue advantage to the patentee which may then be able to impose a license not meeting with FRAND requirements. 

Frankly, I don’t really see how the judge could possibly have decided otherwise. The message is clear: SEP owners need to be more reasonable when they go to court.

In the meantime, the parties seem to be back to square one.


CASE REFERENCES:

Cour d’appel de Paris, pôle 5 chambre 16, March 3, 2020, Lenovo Inc. et al. v. IPCom GmbH & Co. KG, RG No. 19/21426.

Tribunal judiciaire de Paris, ordonnance de référé, January 20, 2020, IPCom GmbH & Co. KG v. Lenovo SAS et al., RG No. 19/60318.

No U.S. torpedo

No breaking new today, as the case I am going to talk about has already been commented upon in many various places.

Looks like I may have some catching up to do.

And yet, this is a prominent international patent case with a French component, and it involves a quite unusual point of law. So, I would be remiss if I failed to mention it on this blog.

The German company IPCom owns a telecom patent portfolio acquired from Robert Bosch. These patents are presented by the owner as essential for the 2G, 3G and 4G standards.

IPCom has been negotiating a license for some time with the Chinese group Lenovo (which also owns Motorola Mobility) – without any luck so far. 

Lenovo was the first to shoot, litigation-wise, by filing a complaint with the District Court for the Northern District of California in March 2019, seeking the setting of the conditions of a worldwide FRAND license for the IPCom portfolio.

In July 2019, IPCom retaliated by initiating infringement proceedings based on one of their patents, EP 1841268, in the UK.

Probably wary of a likely escalation in other jurisdictions as well, Lenovo filed a motion for anti-suit injunction with the California court on September 18, 2019.

On October 16, 2019, IPCom performed infringement seizures against the French Lenovo subsidiaries and filed a motion for preliminary injunction.

On October 24, 2019, IPCom filed a petition with the juge des référés (the judge in charge of emergency interim proceedings) in Paris, seeking the withdrawal of the motion for anti-suit injunction filed by Lenovo in the U.S.

In other words, IPCom reacted to the motion for anti-suit injunction in the U.S. by a motion for anti-anti-suit injunction in France.

The hearing on the motion for anti-suit injunction in the U.S. was originally scheduled on November 14, 2019. Lenovo, in an attempt to beat the French proceedings, tried to bring this hearing forward by filing a motion to expedite with the U.S. court. IPCom was not intimidated and obtained an ex parte order from the French judge dated October 30, 2019, per which Lenovo was ordered to withdraw the motion to expedite, so that the hearing on the motion for anti-anti-suit injunction in France could take place on November 6, 2019, before the hearing on the motion for anti-suit injunction in the U.S.

Still on October 30, 2019, the motion to expedite was rejected by the U.S. court. The hearing in front of the juge des référés took place on November 6, 2019 as planned, and the judgment was issued on the same day, which is really remarkable.

At this point, you would probably venture that this post will mainly thrill civil procedure geeks, and not so much GSM, UMTS or LTE geeks – and you would be right.

Now that you have been warned, we can go through the judgment.

Before the judge was able to decide on the very procedural motion at stake… there were of course a few procedural preliminary objections to deal with.

First, Lenovo argued that the October 25, 2019 petition had not been properly served on the U.S. defendants before the deadline of October 29, 2019 which had been originally set by the judge for this service to take place.

However, the judge deemed that the formalities were properly performed by the due date. A French bailiff sent the petition on October 25, 2019 to the U.S. process server, and in parallel shipped it by express mail – which was received on October 28. Still in parallel, the petition was also sent to Lenovo’s usual French attorney. The petition was referred to by Lenovo on October 28 when they filed their motion to expedite with the California court. As a result, the juge des référés deemed that everything was in order, even if the U.S. process server did not provide the proof of service before the due date.

Second, Lenovo objected that the French judge lacked jurisdiction and that only the District Court for the Northern District of California had jurisdiction.

The judge dismissed this objection, mainly based on article 46 Code de procédure civile, per which, in a non-contractual dispute, a plaintiff may initiate proceedings in “the court of the place of the event causing liability or the one in whose district the damage was suffered”. 

The judge noted that, if the anti-suit motion was granted in the U.S., IPCom would suffer harm in France. Therefore, the French judge had jurisdiction over the petition for an anti-anti-suit injunction.

Third, Lenovo raised an objection due to lis pendens and related proceedings.

Since a lawsuit was already pending in California, the French judge should defer to the U.S. court, Lenovo argued. Once again, the juge des référés disagreed, noting that the present action related to a different matter from the one in front of the U.S. court; and that it would not be proper (in the original text: “pas d’une bonne administration de la justice“) to defer to the U.S. court when the very purpose of IPCom’s petition is to prevent the U.S. proceedings from interfering with the French proceedings.

Finally, the judge was able to address the petition on the merits, so to speak.

The judge stated that article 808 Code de procédure civile empowers her to order any measure which is not serious challenged or which is justified by the existence of a dispute, if there is an emergency.

In the present case, the existence of an emergency was easy to establish, in view of the pending motion in front of the U.S. court.

Then, the judge stated that anti-suit injunctions are not allowed among member states of the EU.

With regard to a non-EU country such as the U.S., the judge held that an anti-suit injunction would violate the French international public order – except if a jurisdiction clause or an arbitration clause was at stake, which was not the case here.

Wrote the judge:

Indeed, the anti-suit injunction (except in the cases mentioned above) is an interference with the jurisdiction of the courts and indirectly results in violating the exclusive jurisdiction which each state enjoys in order to freely define the international jurisdiction of its courts. 

Therefore, the judge granted IPCom’s petition.

Lenovo was ordered to immediately withdraw their motion for anti-suit injunction, insofar as it relates to legal proceedings which could be initiated by IPCom in France regarding EP 1841268. Lenovo was ordered not to file any other similar motion anywhere in the world. This order was issued under a penalty of 200,000 euros per violation and per day of non-compliance.

All in all, this ruling is a quite spectacular affirmation of sovereignty from the French court. The docket was fast-tracked at quasi-light speed, including with the interim issuance of the ex parte order mentioned above (which is rather exceptional), to make sure that the anti-anti-suit injunction was issued before the U.S. court could rule on the motion for anti-suit injunction.

My initial reaction is that this judgment fully makes sense. Patent infringement is a matter of national law, and it would thus be shocking if a patent proprietor could be prohibited by a foreign court to even attempt to assert its IP.

Accordingly, I understand that the high court in the UK also granted IPCom an anti-anti-suit injunction in the same case (see here). A few months earlier, in a different case and under different circumstances, an anti-anti-suit injunction was also issued in Germany (see here).

That said, without knowing of course who is acting in more or less good faith or bad faith, I do also have some sympathy with Lenovo’s position to some extent. The central issue in this dispute is that of setting the terms and conditions of the FRAND license for the IPCom portfolio. If the parties cannot agree, litigation must solve the issue.

But once the matter has already been brought in front of a court of law, what is the point in filing patent infringement suits here and there, beside exerting additional pressure on the would-be licensee?

To Lenovo’s point, centralized litigation makes more sense on a global standpoint.

But then again, on the other hand, there is something wrong in the notion that the first party to act can choose the forum that they please and then stop and freeze any possible initiative of the other party outside of that forum.

Why should the first one to pull the trigger always have the upper hand? After the Italian torpedoes which were in fashion some time ago, Lenovo tried to launch a U.S. torpedo, but it fizzled out.

Anyway, the case can easily make one think of a house of mirrors. It seems like an endless source of paradoxical questions.

In a procedural maze.

To wit:

  • Could Lenovo have filed a motion for anti-anti-anti-suit injunction in the U.S.? And so on? Is there any theoretical end to this game?
  • By issuing the anti-anti-suit injunction, didn’t the French judge achieve exactly what she wanted to avoid in the first place, i.e. interfere with another court’s business? In other terms, if an anti-suit injunction is per se illegitimate, isn’t there some illegitimacy in an anti-anti-suit injunction as well?
  •  What if the anti-suit injunction had been granted in the U.S.? What would the effect have been in France? The injunction would have targeted the patent proprietor, not the French court itself. So, could the French court have thwarted the effect of the injunction by e.g. granting damages to the patent proprietor for any loss suffered due to non-compliance with the U.S. injunction? Would the court have had jurisdiction to do so?

Anyway, now that a few months have passed since this ruling, I bet that multiple new developments have taken place in this multinational game of 3D procedural chess, and I would be delighted to be updated by any readers in the know.


CASE REFERENCE: Tribunal de grande instance de Paris, ofronnance de référé, November 8, 2019, IPCom GmbH & Co. KG v. Lenovo Inc. et al., RG No. 19/59311.

Haunted

In the patent profession, cases have this way of always coming back at us.

You may work hard on a case and complete a difficult action, possibly with some sense of achievement (or relief). But then, a few months or years later, the case is back with a vengeance.

Happy about the way you have drafted your patent application, having navigated through all of the prior art and the inventor’s wishes? Wait until you get the search report. Enjoying your ride or flight back home after having been steam-rollered in opposition oral proceedings? Let’s meet again in 2 years’ time for the appeal. Satisfied that you have managed to digest the other party’s 300-page submissions just in time to file your reply in court? As well you should, although next time you will get 350 pages from them.

And so it is with this blog.

Almost exactly 2 years ago, I published a post on Ethypharm SAS v. Merck Sharp & Dohme Corp. 

Now that the appeal judgment has been handed down, it seems like a good time to revisit this litigation.

Most appeal judgments in France confirm the first instance decisions (it is said that the confirmation rate is around 80%). But this one did not confirm, which makes it all the more interesting.

As a reminder, the case pitches Ethypharm as a nullity plaintiff against Merck Sharp & Dohme Corp. (MSD), defendant and owner of the patent in suit, EP 1455756.

The first topic addressed in my previous post was the assessment of whether the action was time-barred. On this aspect, the appeal judges came to the same conclusion as their colleagues below, with a slightly different reasoning.

The TGI had decided that the starting point for the 5-year limitation period was the date of the EPO Board of appeal’s decision (July 7, 2014), announced during the oral proceedings, per which the patent under opposition was to be maintained in amended form.

As noted in my post, this finding was already a deviation from earlier case law.

The Paris Cour d’appel took an even later date as a starting point, namely the day on which the amended patent was published by the EPO (September 23, 2015). Said the court: “this is when the modified patent became opposable to third parties“.

An entirely reasonable finding, but which makes it more difficult than ever to know and predict how this limitation period should be computed in general. Case law keeps going all over the place. Fortunately, the statute has now been amended so as to take away this disastrous limitation period. We will still have to live with this legal mess, but less and less so.

The other notable point in my earlier post was that I felt there may be some contradiction in the TGI’s position regarding sufficiency on the one hand and inventive step on the other hand.

As a reminder which is probably quite necessary (at least for me), claim 1 reads as follows:

A nanoparticulate composition comprising the compound 2-(R)-(1-(R)-(3,5-bis(trifluoromethyl)phenyl)ethoxy)-3-(S)-(4-fluoro)phenyl-4-(3-(5-oxo-1H,4H-1,2,4-triazolo)methylmorpholine [a.k.a. aprepitant], or a pharmaceutically acceptable salt thereof, the compound having adsorbed on the surface thereof at least one surface stabilizer in an amount sufficient to maintain an effective average particle size of less than about 1000 nm; where “effective average particle size of less than about 1000 nm” means that at least 95% of the particles, by weight, have a particle size of less than about 1000 nm.

Ethypharm’s insufficiency challenge failed at first instance, as the court noted that there was a prior U.S. patent disclosing the so-called “Nanocrystal” method, for making nanoparticles with a surface modifier adsorbed thereon, having an average size of less than 400 nm. This Nanocrystal patent also taught that such nanoparticles improve the bioavailability of poorly water-soluble actives.

Ethypharm also argued lack of inventive step of claim 1 over this Nanocrystal patent, but the attack failed. The lower court held that the teaching of the Nanocrystal patent could not be applied in an obvious manner to aprepitant, and that there were many technical uncertainties.

I was not completely comfortable with the articulation between both positions.

Maybe the appeal judges also had trouble with this approach: while they agreed that the invention was sufficiently disclosed in the patent, they held that it lacked inventive step.

Starting with sufficiency, the court tackled plausibility, an essential phase of most pharma cases. The court repeated the now well-established French criterion per which the patent must “directly and unambiguously reflect the therapeutic effect” at stake. But then they added that “it is not systematically required that the description of the patent should contain tests, this condition is not required in case of a product claim”. A helpful comment, quite in line with the Boards of appeal’s stance on the matter.

The court further remarked that the patent in suit made reference to the U.S. Nanocrystal patent, which made it plausible for the skilled person that nanoparticulate aprepitant had improved bioavailability. Ethypharm did not demonstrate that this was not the case and thus did not discharge its burden of proof. In fact, it appears that some test reports were filed by the plaintiff to support the sufficiency challenge, but they were deemed inconclusive.

Turning then to inventive step, MSD’s case was that increasing bioavailability was a complex problem, and that there were many parameters to be taken into account.

To them, reducing the size of aprepitant particles to less than 1000 nm was not an approach that the skilled person would have used.

But the court relied on expert’s evidence showing that the dissolution rate is often a limiting factor in bioavailability; and that reducing the particle size of a drug makes it possible to increase the contact surface area between the undissolved active and the solvent, which generally increases the dissolution rate. Reference was made in particular to a 1982 textbook.

MSD countered that reducing the particle size to less than 1000 nm was not commonly practiced at the priority date, and had been little explored. The court was not persuaded. Some nanoparticulate drugs were tested already in the 1990s, and it had been proposed in a general manner that a poorly soluble drug could be reduced to a nano size. The Nanocrystal technology of course was also taken into consideration. Not just the patent, but also a press release by Elan Technologies, according to which their process was broadly applicable to many poorly soluble actives.

MSD further relied on a document showing that micronization of aprepitant did not give satisfactory results, so as to show that the skilled person would not have continued with this approach. But the document was an internal one and the skilled person would of course not have been aware of it.

In the end, the court did not deny that there were several possible approaches for the skilled person, but found that the nanoparticulate approach was nevertheless obvious to try:

Even if the skilled person knew of other methods and if the EP’299 patent only showed tests on three different active ingredients, he […] knew that nanonization improved the bioavailability of poorly soluble active substances and was thus incited, based on converging information […], to start research on this pathway in order to improve the bioavailability of aprepitant when used as a drug.

The Board of appeal decision per which the patent was maintained in amended form, namely T 210/11 (Board 3.3.07) reached an opposite conclusion of course:

It results that the skilled person, looking for a solution to the problem as defined above, faces multiple possible solutions to said problem of low bioavailability of aprepitant, and would not be conducted by the teaching of documents (5), (6) or (7) to the use of a nano-particulate composition of aprepitant.

Ethypharm was not a party to the opposition proceedings at the EPO, and the Paris court may have been presented with additional evidence that the Board did not see.

But my overall impression is that this is basically a matter of the court and the board placing the inventive step bar at different heights. This may be one of those grey-area cases, with complex facts to consider, which may very well go one way or the other depending on who looks at them.

This is the end of the story – for now, unless there is a cassation appeal and the case comes back to haunt this blog again.

Here it comes again.

CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 1, October 29, 2019, SAS Ethypharm v. Merck Sharp & Dohme Corp., RG No.18/03876.

Patent still standing

The appraisal of standing in patent nullity suits in France is complex and harsh. The topic has been addressed in a number posts, for instance this one, that one or that other one.

The ruling commented upon today revisits the issue, in a quite unusual way.

Today’s case relates to the LEVOTHYROX® controversy.

LEVOTHYROX® is a drug containing a manufactured form of the thyroid hormone thyroxine (T4). It is used to treat thyroid hormone deficiency. The drug is marketed in France by Merck Biopharma.

According to a press release, the French health authorities (ANSM) requested a modification of the formulation so as to better stabilize the active upon storage. In March 2017, Merck Biopharma thus switched to a new formulation containing different excipients. A few months later, a number of patients complained about side effects seemingly caused by the new formulation. A couple hundred thousand people signed a petition demanding that the old formulation be put back on the market.

The existence and the origin of the side effects were hotly debated and I am not aware that any consensus has been reached yet as to what may have gone wrong.

Anyway, it turns out that there is also an IP aspect to this matter. Indeed, European patent EP 2885005 B1, owned by Merck Patent GmbH, protects the new LEVOTHYROX® formulation. Claim 1 is directed to a solid pharmaceutical preparation comprising levothyroxine sodium, gelatin, citric acid and a filler.

In December 2018, 139 individuals claiming to be patients affected by side effects related to the new LEVOTHYROX® formulation filed a lawsuit in front of the Paris TGI, requesting the revocation of the EP’005 patent. They were later joined by 34 additional individuals as well as a patient association, Alerte Thyroïde.

As a defense, Merck Patent GmbH claimed that the plaintiffs lacked standing. A hearing on this defense took place on December 4, 2019, and the judgment has just been handed down. The court has sided with Merck and dismissed the nullity suit for lack of standing.

To some extent, the outcome is unsurprising. As I said in the beginning, the appraisal of standing in patent nullity suits is harsh – excessively so, in my view. If even competitors of a patent owner are sometimes considered as lacking standing, a reasonable gut feeling would be that there is no way individual patients or even a patient association can have standing.

But in fact, looking at the reasons for the decision, the court seems to have actually walked a fine line when deciding the issue.

The starting point in the reasoning is article 31 Code de procédure civile, per which “any person having a legitimate interest in having a claim accepted or rejected may initiate legal proceedings, except if the law restricts the possibility to sue to specific persons […]“.

First, the court recalled the usual criteria that are applied when the litigants are competitors:

When the nullity action relates to two competing parties, the advantage expected from the action under article 31 Code de procédure civile is traditionally understood […] as being an improvement in the legal situation of the plaintiff. It is generally requested from said plaintiff that they should demonstrate the existence of a sufficient interest to free a future exploitation of the patented technology or a similar one. 

But then the court accepted that non-competitors, including members of the general public, could also have standing under article 31:

However, […] the competition / economic case is not the only situation in which a nullity suit could be initiated, and cannot define standing, which by nature is shape-shifting. Therefore, the standing of the plaintiffs, who are not competitors of the proprietor of the patent at stake but consumers and patients directly impacted, notably in terms of material and financial availability of the drug subject to a monopoly, must be appraised in concreto, based on the object and the purpose of the nullity suit […], without neglecting the fact that such an action, which aims at terminating any undue monopoly, is also useful for the general interest, since a revocation would benefit to all. 

There are different ways to achieve standing.

In other terms, the court did not completely close the door to the initiation of patent nullity proceedings by non-traditional plaintiffs. The notion of “general interest” in the last sentence is in fact pretty far-reaching.

The court went on in the following terms:

In fact, whether the grant of a patent is a compensation for investments and efforts made by the creator of the invention or for the disclosure of the invention, it confers a beneficial monopoly to its owner, and additionally an undeniable control over prices. In a context of free competition and free innovation, this is legitimate and admissible only if the validity conditions are met. It is of general interest, in particular in the pharmaceutical field and in case public prosecution, which is first and foremost in charge of defending general interest, fails to act, that an end should be put to the monopoly when the patent is invalid or merely aims at preserving a monopoly conferred by a previous patent about to expire, thus allowing competing generic pharmaceutical companies to offer accessible generic drugs at a lower cost to patients in need of the initially patented drugs. 

I have never heard of a public prosecutor filing a patent nullity suit to open up a market. But the court, based on the above statements, seems to accept the possibility that members of the public could take up this role.

In this respect, the plaintiffs precisely argued that the patent generally protects any levothyroxine formulation containing citric acid, gelatin and any filler, so that the existence of the patent prevents competitors from marketing alternative formulations with other fillers. This is relevant because the filler used in the new LEVOTHYROX® formulation, namely mannitol, was suspected to be responsible for the side effects.

The court responded to the argument as follows:

It is true that, by suppressing the monopoly on [the new formulation] in France, the revocation of the French part of the EP’005 patent […] would not only make it possible to market generics of this drug with perhaps a reduced price, but would also make it possible for other laboratories to make a formulation identical to the old formulation of LEVOTHYROX, which is, according to the plaintiffs, currently impossible because it may infringe the patent at stake which unduly covers the old formulation. 

However, as rightly noted by the defendant, the potential success of the nullity suit would not result in the automatic production and marketing of the old formulation […], which currently no longer benefits from a marketing authorization. 

[…]

The causal link between the nullity suit and the expected effect, namely that Merck or a third party should resume the manufacturing and marketing of [the old formulation] thus appears to be purely hypothetical and may not improve the legal and/or economical situation of the plaintiffs, so that they do not have standing in this case. 

In summary, the ultimate goal of the plaintiffs was to have a different levothyroxine drug available on the market. The court acknowledged that the revocation of the patent would be helpful for this goal. But it would not automatically result in the achievement of the goal, as a MA for a different drug would still be necessary – and is currently lacking.

To my mind, the reasoning is not really satisfactory. Has the court considered that a pharma company may not want to take the pain of requesting a new MA if a patent stands in the way? Therefore, can’t the revocation of the patent be considered as a necessary prerequisite for achieving the claimants’ stated goal?

At the risk of oversimplifying the discussion, shouldn’t any person or company willing to spend the (sometimes considerable) time and effort needed to revoke a patent be presumed to have a legitimate interest in the revocation? Shouldn’t the standing bar be lowered so as to only set aside abusive and frivolous lawsuits?


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 3ème section, January 24, 2020, Alerte Thyroïde et al. v. Merck Patent GmbH, RG No. 18/14575.