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The scope of protection is still the scope of protection

Case report ECJ Case C-414/11" or "Daiichi and Sanofi-Aventis v. DE

19/08/2013

Daiichi Sankyo Co Ltd. ("Daiichi") and Sanofi-Aventis Deutschland GmbH ("Sanofi-Aventis") v. DEMO Anonimos Viomikhaniki kai Emporiki Etairia Farmakon ("DEMO") – European Court of Justice, Case C-414/11, 18 July 2013

Summary

This ruling determines that the entry into force of the TRIPs Agreement – especially Articles 27 and 70 – does not extend the scope of a patent already granted, even if the application in the light of the expected entry into force of the TRIPs Agreement originally also claimed the later patentable scope.

Therefore the holder of a patent cannot assume that the scope of a patent is extended only by a change of law.

Background

The parties were in dispute about a national patent infringement in Greece in which a Greek court decided to stay the proceedings and to refer questions to the ECJ for a preliminary rul-ing:

Daiichi filed an application for a patent relating to the chemical compound levofloxacin hemihydrate. The application claimed protection for levofloxacin hemihydrate as such and for its process of manufacture. Because of a reservation in the EPC (European Patent Convention) and the national patent law in Greece in 1986, the patent was solely granted for its process of manufacture. Until the expiry of the reservation in 1992 the Industrial Property Office for Greece was prohibited from granting national patents for pharmaceutical products.

In 1995 the TRIPs Agreement was ratified in Greece and with regard to Art. 27 pharmaceuti-cal products became patentable. Art. 70(2) in conjunction with Art. 65(1) of the TRIPs Agreement stipulates that a member of the WTO is obliged to fulfil all requirements arising from this Agreement with regard to existing subject-matter.

Sanofi-Aventis distributed a pharmaceutical product with the ingredient levofloxacin hemi-hydrate in Greece based on a licence granted by Daiichi for the ingredient levofloxacin hemi-hydrate. Daiichi applied in 2006 for a supplementary protection certificate (SPC) which was granted. The patent expired in 2011. The Greek authorities granted DEMO in 2008 and 2009 the permission to place a medical product on the market which also contained levofloxacin hemihydrate. Daiichi and Sanofi-Aventis initiated proceedings against DEMO because of the use of levofloxacin hemihydrate.

Even though the granted patent originally did not cover the ingredient levofloxacin hemi-hydrate the court, however, could not exclude the possibility that Daiichi´s patent on the proc-ess of manufacture extended its rights with regard to Art. 27 and 70 of the TRIPs Agreement to levofloxacin hemihydrate as such.
Therefore the court asked inter alia the question:

"Under Articles 27 and 70 of the TRIPs Agreement, do patents covered by the reservation in Article 167(2) of the [EPC] which were granted before 7 February 1992, that is to say, before the above agreement entered into force, and concerned the invention of pharmaceutical products, but which, because of the aforementioned reservation, were granted solely to protect their production process, fall within the protection for all patents pursuant to the provisions of the TRIPs Agreement and, if so, what is the extent and content of that protection, that is to say, have the pharmaceutical products themselves also been protected since the above agreement entered into force, or does protection continue to apply to their production process only, or must a distinction be made based on the content of the application for grant of a patent, that is to say, as to whether, by describing the invention and the relevant claims, protection was sought at the outset for the product or the production process or both?"

Decision

The key question was what scope and limitation the patent did have after the expiry of the reservation of Art. 167(2) EPC in 1992 and the entry into force of the TRIPs Agreement.

Based on the following key statements, the ECJ denied an extension of the scope of the patent in the event of the entry into force of the TRIPs Agreement:

"As DEMO and the United Kingdom Government in particular have observed, regard-less of the precise scope to be given to the rule in Article 70(2) of the TRIPs Agreement and the balance to be struck between that rule and the rule in Article 70(1) which states that the TRIPs Agreement ‘does not give rise to obligations in respect of acts which oc-curred before the date of application of the Agreement for the Member in question’, it cannot be considered that the protection of existing subject-matter referred to in Article 70 of the TRIPs Agreement can consist in attributing to a patent effects which it does not have and never has had."

Two other arguments are:

"However, to classify the invention of the product levofloxacin hemihydrate as pro-tected by virtue of Daiichi Sankyo’s patent on the date of application for the Hellenic Republic of the TRIPs Agreement, when that invention was precisely not protected under the rules which governed that patent until then, would be possible only if that agreement were interpreted as requiring the members of the WTO to convert claimed inventions to protected inventions, on the occasion and solely because of the entry into force of the agreement. Such an obligation cannot, however, be derived from the TRIPs agreement, and would go beyond the ordinary meaning of the words ‘existing subject-matter’."

"Nor does a reading of Articles 27 and 70 of the TRIPs Agreement in conjunction lead to a different conclusion. It is true that, as follows from the examination of Question 2, Article 27 of the TRIPs Agreement obliges members of the WTO to make it possible to obtain patents for inventions of pharmaceutical products. That obligation cannot, however, be understood as meaning that members of the WTO which, in a period an-terior to the date of that agreement’s entry into force, excluded protection of inventions of pharmaceutical products claimed in patents granted for inventions of processes of manufacture of those products must, from that date, regard those patents as covering those inventions of pharmaceutical products."

Comment

For reasons of legal certainty, this ruling is right and logically consistent. It points out that the scope of a patent does not extend by a change of law. A patent will keep the scope of protec-tion which it had at the time of granting.

A further consideration with a similar situation shows that this result is acceptable: X holds a patent for the process of manufacture but not for the product he produces. Y - a market par-ticipant - might have incurred financial expense with regard to this product. Then the product becomes patentable. Now what? Is Y´s business unlawful because of an extension of the pat-ent? The more convincing answer is "no". It would not be convincing if Y were no longer allowed to distribute his product. His expenses have to be protected with regard to legitimate expectations. Any other effect would be similar to an artificial retroactive effect and lead to legal uncertainty.

Authors

Matthias Eck
Prof. Dr. Matthias Eck
Partner
Stuttgart
Alexander Stief
Dr. Alexander Stief