Important European Court Decision on the Specific Mechanism - What Does This Mean for Parallel Trade?
The recent case of Pfizer Ireland Pharmaceuticals v Orifarm GmbH has resulted in an important decision of the Court of Justice of the European Union (the CJEU) on the interpretation of the Specific Mechanism.
The case involves the parallel importation of a pharmaceutical product from certain 'new' EU Member States into Germany. The Court's decision accords with the earlier opinion of the EU's Advocate General. The judgment favours the patentee, Pfizer.
The Specific Mechanism
The Specific Mechanism is an exception to the European law principle of the exhaustion of intellectual property rights concerning pharmaceutical patents. The Specific Mechanism essentially provides that, if at the filing date of a patent or SPC (supplementary protection certificate) for a pharmaceutical product in the 'old' Member State of import (eg Germany), equivalent patent protection was not available in the 'new' Member State of export (eg Poland), the patentee can prevent traders from importing and selling the product in the 'old' Member State.
The Facts of the Case
The parallel trader, Orifarm, imported Pfizer's Enbrel® product (used to treat arthritis) from a number of new Member States into Germany. During the relevant period, Enbrel® was protected in Germany by an SPC owned by Pfizer (an SPC extends the term of certain patents protecting pharmaceutical products by a maximum of five years).
At the filing date of the basic German patent protecting the API (active pharmaceutical ingredient) in Enbrel® (which had since expired), equivalent patent protection was not available in any of the new Member States of export. However, at the filing date of the corresponding German SPC, equivalent SPC protection was available in each of those new Member States.
The referring German court sought clarification on whether, in those circumstances, a patentee such as Pfizer could rely on its rights under an SPC in an old Member State (Germany) to prevent importation of the relevant product from the new Member States during the term of the SPC.
The Court's Decision
The Court ruled that Pfizer could indeed invoke its rights under the German SPC to prevent Orifarm's trade in Enbrel®. The test is whether equivalent protection for that particular product was available in the new Member State(s) at the filing date of the German SPC. Here, even though SPC protection was generally available in the new Member States at the SPC's filing date, Pfizer could not have applied for an SPC for the API in Enbrel® in those countries at that time (subject to the caveat regarding the later availability of basic patent protection explained below). This was because basic patent protection was unavailable in the new Member States at the filing date of the German patent protecting Enbrel®. Therefore, at the filing date of the German SPC, an equivalent basic patent protecting Enbrel® could not have existed in any of the new Member States upon which to found an SPC application to extend such patent. Hence, equivalent SPC protection was not available for Enbrel® at the filing date of the German SPC and the Specific Mechanism applies.
In some of the new Member States of export, basic patent protection became available shortly after the filing date of the German patent and before its publication date. However, the Court ruled this had no impact on the applicability of the Specific Mechanism. The Court observed that to decide otherwise would place on the patentee the unfairly onerous burden of having to monitor the laws of potential accession Member States for the introduction of basic patent protection between the filing and publication dates of the old Member State patent. Therefore, the key date for considering the availability of equivalent basic patent protection (on which to found an SPC application) in the new Member State is the filing date of the patent in the old Member State.
The Court also ruled that a paediatric extension (which, where granted, extends the term of the corresponding SPC by six months) comes within the scope of the Specific Mechanism. This is notwithstanding paediatric extensions are not expressly mentioned in its text. Given paediatric extensions are not a separate intellectual property right, but merely ancillary to the relevant SPC, the Court decided they must fall within the ambit of the legislation.
Comment
The findings of the Court that (1) the applicability of the Specific Mechanism turns on the availability of patent protection for the particular product (rather than generally) and (2) the Specific Mechanism applies to paediatric extensions, appear to be sensible and are perhaps unsurprising. The question of the relevant date (filing or publication) for determining the availability of basic patent protection (for founding an SPC application) was potentially more difficult. In the event, the Court decided on a straightforward approach, favouring the patentee.
The decision does not address how the Specific Mechanism should apply (if at all) to the reverse situation where: (1) equivalent patent protection was available in the new Member State at the basic patent's filing date, but (2) equivalent SPC protection was not available in the new Member State at the filing date of the relevant SPC.