Case number: C04270110 (PAC-0115/2014)
Court: The Chamber of Civil Cases of the Supreme Court of the Republic of Latvia
Parties: American company „E. I. du Pont de Nemours and Company” v. Icelandic company „Actavis Group Hf”
Date: 26 June 2014
IP RIGHT(S) Patents
Arts. 16(1)(1), 62(1), 63(1) Latvian Patent Law (2007), Clauses 11, 12.5, 17, 53, 63.3 Latvian Cabinet Regulation No 899 of 31.10.2008., Art. 5 R 469/2009.
Till 1 December 2010 the claimant owned a supplementary protection certificate for a substance „losartan” used in medicines. Till 11 August 2009 it was protected by a Latvian basic patent.
In September 2008 the claimant checked the register of the State Agency of Medicines and found out that the defendant had received a marketing authorization for medicines that contain the active substance losartan. On 3 March 2010 the defendant had submitted an application to the Centre of Health Economics, asking to put his medicines containing losartan on the List of reimbursable medicines. He had received an authorization for the packaging of the medicines on 18 February 2010 and an authorization for the instruction and the description of the medicines in the Latvian language – on 18 February 2010. The competent authorities had taken positive decisions regarding these applications – they had put the defendant’s medicines on the List of reimbursable medicines and had authorized their marketing.
The claimant regarded the defendant’s activities (the submission of the application to the Centre of Health Economics) as an infringement of his rights granted by the supplementary protection certificate.
The defendant did not admit the claim and assured that he had never infringed the claimant’s rights and had never offered medicines containing losartan for sale during the validity of the supplementary protection certificate. Administrative procedures before the expiration of the supplementary protection certificate are not to be regarded as an offer for sale, namely, as an infringement, but it should be considered as a reasonable behaviour that one could expect from a manufacturer of generic medicines.
DAMAGES AWARDED -
The principal question of the case concerns the conduct of administrative procedures (for entering the market with a generic medicine) – whether it should be regarded as an infringement or as a preparation for an infringement.
The Court held that such activities were not infringing, because they did not involve an offer for sale, forbidden by Article 16(1)(1) of the Latvian Patent Law.
By submission of an application the medicines do not become available in the market, because they have no contact with customers. Such application is neither an offer to conclude a sales contract, neither an advertising addressed to customers.
There is no evidence that the defendant had actually offered the medicines containing losartan for sale in the Latvian market before 1 December 2010.
It is not proportionate, just and in conformity with the spirit of the Patent Law and the Competition Law to interpret the legal provisions in a way, according to which the manufacturers of generic medicines would be allowed to enter the market only after the expiration of the respective patent (or the respective supplementary protection certificate). In such case the appearance on the market of the generic medicines would be artificially hampered and the validity of patents (or certificates) would be prolonged without any legitimate grounds.
When evaluating the conduct of administrative procedures, the Court must consider whether the procedures had been initiated in a reasonable time before the expiration of the patent (or the certificate) and whether the manufacturer of generic medicines did not have an intention to infringe the rights of the patent (or the certificate) proprietor.
If the time is reasonable and no intention to infringe has been found, then the conduct of administrative procedures may not be regarded as an infringement.
In the particular case the Court found the time of submission of the documents reasonable and proportionate for all administrative procedures to be completed until the expiration of the certificate, because Cabinet Regulation No 899 of 31.10.2008. provides for 180 days from the submission of the application for the authority to take a decision. The Court also did not find the defendant’s intention to sell medicines containing losartan in the Latvian market before 1 December 2010.
Therefore the submission of the application at the particular circumstances did not constitute either a preparation for an infringement. It should be regarded as a preparation for a legitimate trade after the expiration of the supplementary protection certificate.
In this judgment the Court explained that the conduct of administrative procedures by a third party (for entering the market with a generic medicine) at the time of validity of the supplementary protection certificate is not an infringement or a preparation for an infringement, if this third party did not have an intention to sell the medicine before the expiration of the supplementary protection certificate and if the administrative procedures had been initiated in a reasonable time before the termination of the supplementary protection certificate.