5 Things to watch out for life sciences practitioners.
1 - Does the Orphan Drug Regulation grant a subjective civil law right of market exclusivity?
With its decision of October 25, 2024, the 21st chamber of the District Munich I (“Eculizumab II”, 21 O 10225/23, GRUR-RS 2024, 31059) referred three questions regarding the Regulation (EC) No 141/2000 (Orphan Drug Regulation) provides a legal position of a market exclusivity for its right holder that can be asserted against third parties in civil proceedings. In detail, the court asks:
(1) Does Article 8 Orphan Drug Regulation confer a subjective legal position under civil law in favour of the holder of one or more indication-specific marketing authorisations for an orphan medicinal product in the form of a right of market exclusivity which the holder of market exclusivity can assert in civil proceedings against third parties if they interfere with that legal position?
(2) If the answer to question 1 is no, does the Orphan Drug Regulation, according to its overall objective - as reflected in particular in recital 8 of the Regulation - grant the holder of one or more indication-specific marketing authorisations for an orphan medicinal product a right of market exclusivity over and above the right of market exclusivity provided for in Art. 8 Orphan Drug Regulation, a subjective legal position under civil law in the form of a right of market exclusivity which the holder of market exclusivity can assert in civil proceedings against third parties if they interfere with that legal position?
(3) If the answer to question 1 or 2 is yes, do the claims of the holder of such a subjective civil law right of market exclusivity arise directly from European law in the event of interference with this legal position by third parties or are their scope and form governed by national law?
It is a clear trend in the last years that market exclusivity rights are increasingly getting into focus in litigations that initially focused on patent law only. The Court of Appeals Munich in the decision “Eculizumab I” initially decided on February 1, 2024 (PharmR 2024, 443) in the preliminary injunction proceedings that the market exclusivity right pursuant to the Orphan Drug Regulation is not “another right” within the meaning of Section 823 (1) BGB, i.e. it is not to be considered as a subjective right. By that, it overturned the District Court Munich that had initially granted a preliminary injunction. The Court of Appeal argued that the Orphan Drug Regulation only contains an official prohibition on processing and authorisation with the consequence that no authorisation may be granted to potential competitors by the competent authorities. With its referral, the District Court. In preliminary injunction proceedings, decisions of the Court of Appeals are not final and not appealable. In the proceedings on the merits, the District Court Munich now insists on its view and referred the questions on the interpretation of the Orphan Drug Regulation to the CJEU.
The question of whether the Orphan Drug Regulation grants subjective rights is highly discussed in the life sciences regulatory and patent world. Therefore, all eyes are now on the CJEU and hopefully, we will get more clearance on this important issue in 2025.
2 - What are the criteria for getting an SPC for a combination product?
In the neverending fog of how to interpret Art. 3 (a) and (c) of the SPC Regulation (Regulation (EC) No 469/2009 of the European Parliament and of the Council of 6 May 2009 concerning the supplementary protection certificate for medicinal products), the CJEU again tried to clear the fog a little with its decision of December 19, 2024. It decided that Art. 3 (c) must be interpreted as not precluding the grant of an SPC for a product consisting of two active ingredients even if one of those two active ingredients has already been, alone, the subject of an earlier SPC and it is the only one to have been disclosed by the basic patent, whereas the other active ingredient was known at the filing date or priority date of that patent.
On Art. 3 (a), it found that it is to be interpreted as meaning that it does not suffice that a product is expressly mentioned in the claims of the basic patent in order for that product to be regarded as being protected by that patent, within the meaning of that provision. It is further necessary, that the product necessarily falls, from the point of view of a person skilled in the art, and in the light of the description and drawings of that patent, under the invention covered by that patent at the filing date or priority date. In addition, a product consisting of two active ingredients (A+B) is protected by a basic patent, within the meaning of that provision, where A and B are expressly mentioned in the claims of that patent and the specification of that patent teaches that A may be used as a medicinal product for human use alone or in combination with B, which is an active ingredient in the public domain at the filing date or priority date of that patent, provided that the combination of those two active ingredients necessarily falls under the invention covered by the same patent.
On Art. 3 (a), the decision seems to be in line with the two-step-test of the Teva/Gilead decision (C-121/17). It is now up to the national courts to enjoy the fun of analyzing this decision in practice, i.e. to decide whether a product, even if expressly mentioned in the claim is indeed part of the actual invention covered by the patent, i.e. to ensure that the patent proprietor is only granted an SPC if the combination product is the result of the research which led to the invention. Although this decision seems clear and faire in its reasoning and is in line with the purpose of the SPC Regulation, it will create quite some complexities for the courts and the parties involved in the future. Hence, the only thing that is sure for 2025: The fog might be lighter, but remains and a new referral to the CJEU is more than safe.
3 - UPC – still open questions
While there have been some decisions discussing novelty and inventive step already (see for example Nanostring/10x Genomics, TW comment here: The UPC Appeal Court overturns the 10x Genomics PI, but focuses on validity; Abbott/Dexcom). From those decisions, it can be taken that the UPC is not referring to the established legal approach of any other jurisdiction (including the EPO), but instead beginning to develop its own methodology. Many practitioners are also impatiently awaiting a decision on plausibility in order to know whether there will be a plausibility requirement in the UPC and if so, how it will be applied.
Further, given the lack of substantive law in the UPC, there are many open questions in infringement cases, reaching from principles of damages calculation over the requirements for joint liability to the territorial scope of indirect infringement according to Art. 26 UPCA.
4 - Process patents in international context – when is a process patent infringed in Germany/the UPC?
While it has already been clarified by the UPC that it is sufficient for having jurisdiction that customers in the UPC territory are addressed e.g. via online offers, already in May 2023, the Munich District Court I decided the case “Proof of analytes” (Nachweis von Analyten, 17.5.2023 – 7 O 2693/22, GRUR 2024, 205) in case of a process patent where detection reagents and decoder probes were sold in Germany and several process steps were realized in Germany, but the data processing and determination of the analysis result took place in the United States. The DC Munich found that the decisive factor for liability for domestic patent infringement is whether the technical success of the invention occurs in Germany and whether the user consciously makes use of any foreign procedural acts for this purpose. It is hence irrelevant whether the last procedural step is achieved outside Germany and the result of the procedure is therefore produced abroad, as long as the advantages of the patent procedure have their effect in Germany due to procedural steps carried out in Germany that are not insignificant. Appeal is pending. In view of the decision “Prenatal diagnosis” of the Court of Appeals Düsseldorf (decision of 23.03.2017 – 2 U 5/17, GRUR-RS 2017, 109826) that found that indeed, the place where the last procedural step according to the patent claim takes place is of relevance, it will be very interesting to see where exactly the Court of Appeals Munich will draw the line. With the rise of medicinal and medical devices applications that integrate data processing for getting results and diagnosis, the amount of similar cases where process steps take place partly in Germany (or the UPC territory) and partly abroad, will increase.
5 - Competition law: the divisional game – is it over?
Recently, in October 2024, the EU Commission the EU Commission in October, imposed a EUR 462.6 million fine on for misusing its dominant market position in its patent filing and communication strategy concerning its multiple sclerosis drug Copaxone (case no. AT.40588). Nora Wessendorf explains the background and consequences of this decision in her article. It remains to be seen in 2025 whether, and under which circumstances, playing the divisional game alone – without the accompanying move of a disparagement campaign – will be viewed as anti-competitive by the EU Commission.
