Abstract
EU Legal and Regulatory Update
Compiled and written by SCP Herald*
Herald Avocats is a French law firm involved in intellectual property law, pharmaceutical law and European Union law that provides services to healthcare, biotech and pharmaceutical companies.
This section is intended to be a synopsis of recent developments and is not intended to be all comprehensive. If any (issue) information referred to in this section is to be relied upon, specific advice should be sought. Please contact the Editor:
Richard Milchior and Séverine Charbonnel
SCP Herald
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75008 Paris France
Tel: +33 (0)1 53 43 15 15
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Email: r.milchior@herald-avocats.com
*Since November 2018 the name of the firm of the authors of this chronic Granrut changed to become Herald.
UK SUPREME COURT – October 25 2019
SHANKS V UNILEVER ([2019] UKSC 45)
Employee invention–patented invention–compensation – Outstanding benefit
Facts and proceeding
Professor Shanks was employed by UK Central Resources Ltd (CRL), a subsidiary of Unilever, for four years in the 1980s to invent biosensors.
During the period of his employment, Professor Shanks used, at home, slides from his daughter’s microscope kit and some bull-dog clips to build the first prototype of an electrochemical capillary fill device (ECFD). These activities were considered to fall under the scope of Professor Shanks’ duties as an employee.
Unilever filed patents for the ECFD.
Following expansion of the glucose testing market in the 1990s, ECFD technology began appearing in most personal glucose testing products, with the majority of companies in the field licensing the technology from Unilever.
Professor Shanks failed in his previous attempts to receive compensation: first at a UK IPO Hearing, the Hearing Officer calculated the total gross profit obtained by Unilever from the Shanks’ patents as £24.5 million (£24.3 million net benefit after costs).
The Hearing Officer determined that this amount was not ‘outstanding’ in view of Unilever’s normal activities.
This decision was upheld on appeal first in the Patents court ([2014] EWHC 1647 (Pat) and then in the Court of Appeal ([2017] EWCA Civ 2.)
He finally granted a £2 million compensation from Unilever with the UK Supreme Court’s decision.
Legal basis
According to Section 40 of the UK Patents Act (UKPA) an employee may be awarded compensation for their patented invention, if the patent or invention has provided an ‘outstanding benefit’ to the employer.
One of the difficulties is that outstanding benefit must be determined in the context of the employer’s normal business activities; this implies that the benefit can be very high depending on the type of companies involved. Here it is important to notice that patent licensing is not a normal business activity of Unilever, who predominantly have patents to protect their own business activities. Therefore, the licence income from the Shanks’ patents was unusual.
In the present case, Professor Shanks created the invention related to technology used in glucose testing for diabetics when he was employed at Unilever.
Unilever did not commercialise the technology itself but started by license the technology out and then at the end Unilever sold the patents for the technology as part of the sale of it diagnostics business Unipath.
During the exploitation of the patents Unilever earned millions in profits; these profits were small compared to Unilever’s overall profits.
The key question: How to define ‘outstanding benefit’?
It results from the first case (Kelly & Anor v GE Healthcare [2009] EWHC 181 (Pat)) in which an employee was awarded compensation that ‘outstanding benefit’ cannot be defined.
The Court must take into account the ‘size and nature of the employer’s undertaking’ according to Section 1(1)(b) UKPA to try to determine if an invention has provided ‘outstanding benefit’ to an employer.
The disparity between the employer’s benefit and employee’s remuneration (or other benefits) should be extreme.
In addition, the outstanding benefit test should not be a simple comparison between the income from a patent and the overall profits of the employer, to the exclusion of all other relevant factors.
Other factors contributing to a more nuanced assessment of outstanding benefit may take account of, for example, turnover and profitability.
The wrong application by the lower Courts and UKIPO if the test for outstanding benefit
The Hearing Officer had erred by only considering ‘outstanding benefit’ in terms of a simple comparison between the benefits from the Shanks’ patents and Unilever’s overall profits.
This means that the revenue from the Shanks’ patents was small compared to Unilever’s overall profits.
However, Professor Shanks argued that other factors should have been properly considered, for example the unusually high rate of return from licence fee income provided by the patents.
The Supreme Court decision
The UK Supreme Court found that the Hearing Officer had incorrectly applied the test for outstanding benefit and for notably four reasons:
The Hearing office started his analysis from Unilever as a whole, whereas Professor Shanks was employed by UK Central Resources Ltd (CRL), a subsidiary of Unilever. The analysis should have focused on the extent of the undertakings of CRL, and should not have focused ‘upon the overall turnover and profits generated by Unilever, as illustrated by the size of its business in making and selling ice cream, spreads and deodorants’. The Hearing Officer did not properly take into account the fact that the size and success of Unilever’s business as a whole did not play any material part in securing the benefit it has enjoyed from the Shanks’ patents. The Hearing Officer, having warned against applying an analysis that would render certain employers ‘too big to pay’, had proceeded to apply such an analysis which involved assessing the extent and nature of the benefit derived from a patent simply by comparing it to the patent owner’s overall turnover or profits.
The UK Supreme Court has therefore reaffirmed that the assessment of ‘outstanding benefit’ should not render an employer too big to pay.
The difference between the business activities of Unilever as a whole and the research arm in which Professor Shanks was involved was emphasised as a determining factor throughout the decision of the UKSC to award compensation.
The approach of UK Supreme Court (compared to the Hearing Officer) is to divorce the activities and purpose of the diagnostics research arm of Unilever from Unilever as a whole.
The UKSC decision therefore reaffirms the importance of the appropriate context for determining the meaning of ‘outstanding benefit’.
GENERAL COURT – 24 October 2019
T-41/19 MSI Svetovanje/EUIPO/Industrial Farmaceutica Cantabria SA
Figurative trademark – Relative ground for refusal – Likelihood of confusion
On 16 February 2016, Nutrismart d.o.o., the predecessor in title to the applicant, MSI Svetovanje, marketing, d.o.o., filed an application for registration of an EU trademark:
The goods in respect of which registration was sought are in, inter alia, Classes 5, 29 and 30 of the Nice Agreement concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks of 15 June 1957, as revised and amended, and correspond, for each of those classes, to the following description:
On 25 November 2016, Industrial Farmaceutica Cantabria SA, filed an opposition based on the EU word mark ‘numederm’, which was filed on 17 February 2015 and registered on 23 September 2016 under the number 13745 052 in respect of goods in Classes 5, 29 and 30 corresponding, for each of those classes, to the following description:
Class 5: Food supplements for human beings for medical purposes, for supplementing a normal diet and for improving health; Class 29: Meat, fish, poultry and game; meat extracts; preserved, frozen, dried and cooked fruits and vegetables; jellies, jams, compotes; eggs; milk and milk products; edible oils and fats; Class 30: Coffee, tea, cocoa and artificial coffee; rice; tapioca and sago; flour and preparations made from cereals; bread, pastry and confectionery; ices and ice creams; sugar, honey, treacle; yeast, baking-powder; salt; mustard; vinegar, sauces (condiments); spices; ice.
On 20 March 2018, the Opposition Division partially upheld the opposition on the ground that there was a likelihood of confusion as regards the following goods:
Class 5: Pharmaceutical preparations for medical purposes; aloe vera preparations for pharmaceutical purposes; aluminium acetate for pharmaceutical purposes; amino acids for medical purposes; albumin dietary supplements; pearl powder for medical purposes; candy, medicated; sweets for medical purposes; diabetic bread adapted for medical use; diagnostic preparations for medical purposes; dietetic foods adapted for medical purposes; dietetic beverages adapted for medical purposes; dietetic substances adapted for medical use; elixirs (pharmaceutical preparations); infant formula; nutritional supplements; cachets for pharmaceutical purposes; lotions for pharmaceutical purposes; royal jelly dietary supplements; royal jelly for pharmaceutical purposes; ointments for pharmaceutical purposes; sunburn ointments and frostbite salve for pharmaceutical purposes; mineral waters for medical purposes; mineral food supplements; lacteal flour for babies; malted milk beverages for medical purposes; milk ferments for pharmaceutical purposes; milk sugar for pharmaceutical purposes; lozenges for pharmaceutical purposes; douching preparations for medical purposes; protein dietary supplements; slimming pills; syrups for pharmaceutical purposes; medicated candies; sugar for medical purposes; antioxidant pills; tanning pills; medicinal drinks; medicinal tea; medical preparations for slimming purposes; mud (medicinal -); herbal teas for medicinal purposes; chewing gum for medical purposes; casein dietary supplements; Class 29: Meat, fish, poultry and game; albumen for culinary purposes; low-fat potato chips; weed extracts for food; hummus [chickpea paste]; yoghurt, soups, preparations for making soup, broth concentrates, cocoa butter; kefir; coconut fat; coconut, desiccated; coconut oil, coconut butter; almonds, ground; broth; milk beverages, milk predominating, milk shakes; milk and milk products; palm kernel oil for food; nuts, prepared; palm oil for food; sausages in batter; tomato purée; tomato juice for cooking; poultry, not live; preparations for making bouillon, fruit-based snack food; dishes of fish; canned fruits; preserved fruit, cooked fruits (compotes), frozen fruits, fruit pulp, fruit salads; fruit chips; fruit peel, fruit jellies, sesame oil; whey; curd; cream (dairy products); preserved soya beans for food, soya milk (milk substitute); sunflower seeds, prepared; whipped cream; tinned vegetables, preserved vegetables, cooked vegetables; dried vegetables, preparations for making vegetable soup, vegetable mousses, vegetable salads; vegetable juices; albumin milk; Class 30: Ice cream; beverages based on cocoa, coffee, chocolate or tea.
On 19 April 2018, the applicant filed a notice of appeal with EUIPO against the decision of the Opposition Division.
By decision of 8 November 2018 (‘the contested decision’), the Fifth Board of Appeal of EUIPO partially annulled the Opposition Division’s decision by rejecting the opposition and allowing registration of the mark applied for in respect of the following goods in Class 5: ‘aluminium acetate for pharmaceutical purposes; diagnostic preparations for medical purposes; lotions for pharmaceutical purposes; ointments for pharmaceutical purposes; sunburn ointments and frostbite salve for pharmaceutical purposes; douching preparations for medical purposes’.
The Board of Appeal dismissed the remainder of the appeal.
In essence, the Board of Appeal found that the relevant public consisted of the general public and of professionals and that the level of attention of that relevant public ranged from average to high.
The relevant public
Having regard to the goods at issue, the Board of Appeal stated, in paragraph 26 of the contested decision, that the relevant public consisted of the general public and of professionals and that its level of attention ranged from average to high.
In the present case, the parties do not dispute that the relevant public consists both of average consumers and of specialist consumers. Likewise, it is not disputed that pharmaceutical preparations and the goods that are capable of being equated with pharmaceutical preparations, as well as dietary or nutritional supplements and dietetic preparations, are the subject of a high or heightened level of attention on the part of the relevant public.
However, as was stated by the Board of Appeal in the contested decision, the relevant public does not have such a level of attention when it is faced with goods in Classes 29 and 30, which cover everyday consumer goods.
The Court cannot therefore uphold the applicant’s claim that consumers’ preoccupations with regard to food chain safety and quality increase the public’s level of attention with regard to those goods, since a level of attention which remains average with regard to the general public, whether that public is English-speaking or not.
The comparison of the goods
In the light of the nature, intended purpose and method of use of dietetic foods adapted for medical purposes, dietetic beverages adapted for medical purposes and dietetic substances adapted for medical use, on the one hand, and of food supplements for medical purposes, on the other hand, all of which relate to health and food, it must be held that those goods may at least be considered to be similar to each other for the purposes of the comparison of the goods.
It must therefore be pointed out that the parties do not dispute that the distribution channels are in part the same. However, even a partial overlap in the points of sale can be an indication that the goods concerned are similar, given that there are numerous points of sale, namely pharmacies, in which the goods covered by the mark applied for and those covered by the earlier mark are sold to the public (see, to that effect, judgment of 26 November 2015, Bionecs v OHIM – Fidia farmaceutici (BIONECS), T-262/14, not published, EU:T:2015:888, paragraph 31).
Furthermore, the mere fact that the sale of ‘pharmaceutical preparations for medical purposes’ and that of ‘food supplements for human beings for medical purposes, for supplementing a normal diet and for improving health’ may be regulated by different legal provisions does not affect the relevant public’s perception, given that, when choosing goods, that public is only very rarely aware of the applicable legal provisions (judgment of 26 November 2015, BIONECS, T-262/14, not published, EU:T:2015:888, paragraph 32).
The Board of Appeal’s findings in paragraph 50 of the contested decision must therefore be upheld.
It must be stated that, in order to conclude that the goods in question were similar, the Board of Appeal did not only take into account the medical purpose of the goods referred to by the applicant, but also other criteria.
Moreover, as regards the medical purpose of the goods referred to by the applicant, it must be held that such a purpose may be deduced from the fact that those goods are in Class 5, which, according to the Nice Classification, includes mainly pharmaceuticals and other preparations for medical or veterinary purposes and, in particular, dietary supplements intended to supplement a normal diet or to have health benefits and meal replacements and dietetic food and beverages adapted for medical or veterinary use. From that point of view alone, as EUIPO submits in its response, ‘infant formula; lacteal flour for babies; slimming pills; tanning pills’ may be regarded, generally, as goods for medical purposes within the meaning of the Nice Classification as regards goods in Class 5.
The applicant maintains that there is only a low degree of visual similarity between the signs at issue and that they are completely dissimilar phonetically and conceptually. It submits that there is therefore only a very low degree of similarity between those signs.
It is apparent from the foregoing that the Board of Appeal was right in finding that there is a certain degree of visual similarity between the signs at issue, that those signs are phonetically similar to an average degree and that, since the mark applied for is devoid of any meaning for the relevant English-speaking public, there is no conceptual similarity between the signs.
A global assessment of the likelihood of confusion implies some interdependence between the factors taken into account and, in particular, between the similarity of the trademarks and that of the goods or services covered. Accordingly, a low degree of similarity between those goods or services may be offset by a high degree of similarity between the trademarks, and vice versa (judgments of 29 September 1998, Canon, C-39/97, EU:C:1998:442, paragraph 17, and of 14 December 2006, VENADO with frame and others, T-81/03, T-82/03 and T-103/03, EU:T:2006:397, paragraph 74).
In the present case, the applicant submits that, since the trademark applied for and the earlier trademark differ visually, phonetically and conceptually and the average consumer will, in view of the high level of attention which he displays, be able to distinguish between the goods bearing one or other of those trademarks, there is no likelihood of confusion between the trademarks at issue. It maintains that the goods at issue are not general consumer goods, but consumer health goods. It submits that it should also be taken into account that the element ‘derm’ in the earlier trademark, which refers to dermatology, has nothing to do with the goods covered by that mark and that trademark has a normal degree of distinctiveness. In conclusion, the applicant submits that there is no likelihood of confusion on the part of the relevant public.
In the light of all the considerations set out above, and given that the applicant does not dispute the Board of Appeal’s findings as regards the distinctive character of the trademark applied for (see paragraph 16 above), it must be held that the Board of Appeal was right in finding, on the basis of the overall assessment carried out in paragraphs 67–72 of the contested decision, that there was a likelihood of confusion between the signs at issue with regard to all of the goods at issue, on the ground, in particular, that those goods were at least similar and that those signs had an identical element in common which would be perceived as such by the relevant public.
Consequently, the single plea in law put forward in the application must be rejected and the action must be dismissed in its entirety.
High Court of Justice Business and Property Courts Intellectual Property List (Chancery Division) – 4 October 2019
Case HC-2015-005005- Glaxo Wellcome UK Limited and Anor v Sandoz Limited and Ors
Trademark infringement for colour purple – Deception as to trade origin – Misrepresentation as to equivalence – Passing off claim
Since 1999, Glaxo has sold purple ‘Evohaler’ and ‘Accuhaler’ inhalers for its blockbuster salmeterol/fluticasone propionate product, Seretide/Advair, a treatment for asthma and chronic obstructive pulmonary disease (COPD).
Until 2015, Seretide inhalers were the only purple inhalers (and only inhalers sold in purple packaging) on the UK market.
Glaxo also sells Accuhalers containing other active ingredients, which are distinguished from the Seretide Accuhaler by different colours (blue, green and orange); the earliest was sold in 1994.
Glaxo’s combination patent has long expired, and a patent protecting the Seretide Accuhaler dry powder inhaler (DPI) device expired in the UK more recently.
Therefore, a generic entered on the UK market in 2015, albeit via a different form of inhaler delivery system.
Later in 2015, Sandoz launched a branded generic competitor to the Seretide Accuhaler, the AirFluSal Forspiro, a proprietary DPI manufactured by Vectura, with a different mode of operation to the Accuhaler.
Like the packaging for the Seretide Accuhaler, the AirFluSal Forspiro packaging is also purple and white.
Its trademark infringement action failed when GSK’s EUTM for the colour purple was revoked on summary judgment.
The judgment
Both the Seretide Accuhaler and AirFluSal Forspiro are prescription-only medicines (POMs), the promotion of POMs to patients is highly restricted, and prescriptions are normally (and increasingly) written by brand name, not generically.
Glaxo’s case outlined two forms of passing off, originally based on the entire ‘get-up’ of the AirFluSal Forspiro, but later narrowed to just the colour purple:
Deception as to trade origin. Originally, Glaxo alleged such deception in relation to healthcare professionals (HCPs) and patients; by the time of trial, this ground was confined to patients (the evidence given by HCPs showed that they would see the colour purple as denoting the combination of salmeterol and fluticasone, and not necessarily Seretide specifically). Misrepresentation of HCPs and patients as to equivalence between the products, on the basis that AirFluSal Forspiro (unlike the Seretide Accuhaler) (i) was not licensed for asthma (only COPD) prior to February 2017, and still is not licensed for adolescents; (ii) is only available in a single strength; and (iii) has a different mode of operation, so patients have to be trained to use it.
Glaxo provided several surveys (which have been commissioned for earlier UK trade mark registry proceedings in 2015 and 2016) but Glaxo’s survey evidence was of limited value for the following reasons:
they were of HCPs, and not patients; only one question from the surveys provided any form of (indirect) evidence of patient identification of inhaler origin; none of the surveys dealt with misrepresentation as to equivalence.
The judge concluded that he had seen no evidence that patients would perceive the colour purple as denoting any specific product characteristics.
Therefore the judge dismissed both forms of passing off claim in relation to patients.
For the question of misrepresentation of equivalence to HCPs, the evidence showed high levels of awareness among HCPs regarding the differences in the mode of operation of different inhalers and that HCPs would not make assumptions about the scope of a product’s marketing authorisation on the basis of colour.
The Defendants were also required to give extensive disclosure against their alleged intention to deceive/recklessness as to deception in adopting the colour purple.
Therefore, we understand the decision rendered since it has been demonstrated that there were legitimate reasons for the Defendants to choose purple.
General Court – 19 September 2019
Case T-783/17 – GE Healthcare A/S v/European Commission
Medicinal products for human use – Suspension of the marketing authorisation for gadolinium-containing contrast agents – Precautionary principle – Equal treatment – Proportionality – Impartiality
GE Healthcare A/S is a Norwegian wholly owned subsidiary of GE Healthcare Inc, which is a member of the GE Healthcare group of companies, engaged in various medical and pharmaceutical activities worldwide.
GE Healthcare A/S is the manufacturer of Omniscan (gadodiamide) and the marketing authorisation holder for that product in 15 Member States.
Omniscan is a contrast agent with a linear structure based on gadolinium (‘linear gadolinium’), as opposed to contrast agents also based on gadolinium but with a macrocyclic structure (‘macrocyclic gadolinium’).
It is administered intravenously and is used to provide contrast image enhancement, in order to improve images obtained in magnetic resonance imaging (MRI) and in magnetic resonance angiography imaging. Gadolinium-containing contrast agents improve the visualisation of tumours and lesions in patients and optimise the accurate diagnosis of chronic conditions such as cancer and heart disease.
They are classed as medicinal products.
In the course of 2010, the Committee for Medicinal Products for Human Use (CHMP) found a link between gadolinium-containing contrast agents and nephrogenic systemic fibrosis in patients with severe renal impairment. That finding led to the adoption of risk-management measures. Those measures include warnings in the product information, restrictions on use in patients with impaired renal function and contraindication in patients with severe or acute renal impairment.
On 14 January 2016, the PRAC considered that the risk–benefit balance of Omniscan remained positive. Nevertheless, the PRAC recommended adding the accumulation and retention of gadolinium in the brain to the risk management plan and to state in that plan that there was no information on the clinical implications of that retention.
On 9 March 2016, the European Commission triggered a referral as provided under Article 31 of Directive 2001/83 on the ground that a review of gadolinium-containing contrast agents would allow a more in-depth assessment of the evidence of their accumulation in the brain. The Commission added that such a review would also enable a re-evaluation of the risk–benefit balance of those products in order to determine whether the MA should be maintained, varied, suspended or revoked.
At the end of the first recommendation of 9 March 2017, the PRAC recommended, inter alia, the suspension of the MA for Omniscan.
On 20 March 2017, the applicant requested a re-examination of the first PRAC recommendation.
The PRAC issued its second recommendation on 6 July 2017. It was very similar to the first.
In the light of the foregoing, and taking into account the existence of alternative products and the serious concerns regarding potential neurological harm, as well as the risks already associated with the use of linear gadolinium-containing contrast agents, including the significant risk of nephrogenic systemic fibrosis and skin plaques, the PRAC considered that patients could not bear those risks until conclusive scientific evidence on the long term neurotoxic effects of Omniscan became available, and that the benefit of that product in terms of contrast enhancement in MRI did not outweigh those risks.
Ultimately, in its second recommendation, the PRAC reiterated its conclusion that the risk–benefit balance of linear gadolinium-containing contrast agents was no longer favourable, and that, with exceptions, the MA for those products should be suspended, while the MA for other macrocyclic products should be merely varied.
The second PRAC recommendation was sent to the CHMP. The CHMP issued its opinion on 20 July 2017. Despite the divergent positions of the representatives from 12 Member States and the Norwegian and Icelandic representatives, the CHMP agreed, in essence, with the PRAC recommendations. In particular, it considered that the risk–benefit balance of Omniscan was no longer favourable.
On 23 November 2017, the Commission adopted Implementing Decision C(2017) 7941 final concerning, in the framework of Article 31 of Directive 2001/83/EC, the marketing authorisations for gadolinium-containing contrast agents for human use which contain one or more of the active substances ‘gadobenic acid, gadobutrol, gadodiamide, gadopentetic acid, gadoteric acid, gadoteridol, gadoversetamide and gadoxetic acid’ (‘the contested decision’).
By application lodged at the Court Registry on 1 December 2017, the applicant brought the present action and claims that the Court should annul the contested decision and order the Commission to pay the costs.
Since the applicant is relying on, in particular, Article 116 of Directive 2001/83, it should be recalled, as a preliminary point, that that article provides that the competent authorities are to suspend, revoke or vary an MA if the view is taken that the medicinal product is harmful or where its therapeutic efficacy is lacking, or that the risk–benefit balance is not favourable, or where its qualitative and quantitative composition is not as declared.
Consequently, in accordance with the precautionary principle, the health risks which the grounds set out in the first paragraph of Article 116 of Directive 2001/83 aim to prevent need not be specific, but only potential (see, to that effect, judgments of 10 April 2014, Acino v Commission, C-269/13 P, EU:C:2014:255, paragraph 59, and of 3 December 2015, PP Nature-Balance Lizenz v Commission, C-82/15 P, not published, EU:C:2015:796, paragraph 23).
In that system, the first paragraph of Article 116 of Directive 2001/83 confers rights on undertakings which are holders of MAs, since it ensures the retention of MAs as long as the existence of one of the conditions to vary, suspend or revoke them is not established (see, to that effect, judgment of 19 April 2012, Artegodan v Commission, C-221/10 P, EU:C:2012:216, paragraph 96). It follows that, as regards the burden of proof, it is for the competent authority, in this case the Commission, to establish that the conditions relating to the revocation, suspension or modification of an MA, set out in Article 116 of Directive 2001/83, are met (judgment of 7 March 2013, Acino v Commission, T-539/10, not published, EU:T:2013:110, paragraph 79).
In view of the precautionary principle, the Commission may nevertheless merely provide serious and conclusive evidence which, without ruling out scientific uncertainty, gives reasonable grounds for doubting the harmlessness of the medicinal product concerned, its therapeutic effect, the existence of a favourable risk–benefit balance or the qualitative and quantitative composition declared (judgments of 3 December 2015, PP Nature-Balance Lizenz v Commission, C-82/15 P, not published, EU:C:2015:796, paragraph 23, and of 7 March 2013, Acino v Commission, T-539/10, not published, EU:T:2013:110, paragraph 66).
However, the decision to vary, suspend or revoke an MA for a medicinal product is justified only where that decision is substantiated by new, objective, scientific or medical data (judgments of 26 November 2002, Artegodan and Others v Commission, T-74/00, T-76/00, T-83/00 to T-85/00, T-132/00, T-137/00 and T-141/00, EU:T:2002:283, paragraphs 174, 177 and 191 to 194, and of 11 December 2014, PP Nature-Balance Lizenz v Commission, T-189/13, not published, EU:T:2014:1056, paragraphs 44 and 75).
The applicant raised several arguments that the General Court will each dismiss:
In the present case, according to the applicant, there is no solid, persuasive and new evidence of the risk of neurological harm to patients caused by the use of linear gadolinium and its accumulation in the brain. Studies on gadolinium retention in the body and gadolinium toxicity were already available at the time of the single assessment procedure for the periodic safety update reports. The PRAC had already reviewed the studies available at that time and concluded that, in the absence of any evidence of harm, the risk–benefit balance of Omniscan remained favourable. The latest data had not advanced the state of knowledge, except in so far as they indicated the persistence of macrocyclic gadolinium in the brain, with only partial elimination. Furthermore, a study by the M. Clinic in the United States found that cognitive disorders or other neurological disorders could not be associated with Omniscan.
The argument advanced by the applicant is not however convincing:
In the light of recent data, the PRAC found, in the context of the single assessment procedure for the PSURs, that the risk–benefit balance of Omniscan remained positive, but also that there was no information on the clinical significance of the retention of gadolinium in the brain and that that retention, and its clinical consequences, required an in-depth examination. That suggestion led the Commission to open the procedure under Article 31 of Directive 2001/83, which led to the contested decision.
In those circumstances, the data available at the stage of the single assessment procedure for the PSURs cannot be regarded as already fully assessed data which would not justify a suspension of the MA for Omniscan following the procedure at issue.
In any event, it is apparent from the PRAC’s second recommendation that the PRAC relied in particular on about 50 studies published in 2016 and 2017, that is after the single assessment procedure for the PSUR.
A second argument of the applicant is that the PRAC based its second recommendation on the fact that the absence or insufficient amount of data could not be considered to be evidence that there was no risk of adverse neurological effects associated with the retention of gadolinium in the brain. The PRAC thus unlawfully transferred to the applicant the burden of proof which falls on the competent authorities.
In those circumstances, the PRAC was able, without reversing the burden of proof, to find that the absence of, or insufficient amount of data from the case reports could not be considered to be evidence that there is no risk of adverse neurological effects, since it had sufficient information giving rise to reasonable doubt in that regard.
The applicant’s complaints regarding the PRAC’s assessment of the neurotoxic effects associated with the retention of gadolinium in the brain are therefore unfounded.
The applicant submits that it was for the competent authorities to take account of the benefits which Omniscan brings to myocardial perfusion imaging and hypersensitivity reactions.
The applicant submits that Omniscan has a specific benefit compared to other contrast agents for myocardial perfusion imaging, but that the PRAC dismissed that benefit by stating, in its second recommendation, that the whole-body MRI indication, which most other gadolinium-based agents have and, covered heart imaging, including myocardial perfusion imaging.
According to the applicant, there are significant differences between whole-body MRI indication which most other gadolinium-based agents have and covered heart imaging, including myocardial perfusion imaging.
It must, however, be observed that the applicant bases its arguments relating to the benefit of Omniscan for myocardial perfusion imaging on medical considerations, which the Commission disputes with similar arguments, and on scientific literature. As has already been recalled (see paragraph 51 above), the Court cannot substitute its own assessment for that of the PRAC and the CHMP, and its power of judicial review is exercised only over the lawfulness of their operation, and over the internal consistency and reasoning of their recommendations and opinions. Consequently, the Court cannot examine whether the applicant’s statements are well-founded.
Therefore, the first and second pleas in law must be rejected as unfounded, without it being necessary to examine the applicant’s last argument raised as part of the first plea in law, according to which the alleged errors and omissions by the PRAC and by the CHMP cannot be compensated by the fact that the suspension of the MA for Omniscan can be postponed for 12 months by the Member States under Article 3 of the contested decision.
However, it is apparent from paragraphs 69–71 above that the PRAC found that scientific data first showed that linear gadolinium-containing contrast agents were retained for longer in the brain than macrocyclic gadolinium-containing contrast agents and, second, supported the conclusion that exposure to linear gadolinium potentially created, due to its lower stability, a risk of toxicity unlike macrocyclic gadolinium.
Furthermore, it follows from paragraphs 86 and 91 above that the CHMP’s substitution of the word ‘possible’ for the adjective ‘plausible’ used by the PRAC was not significant.
In those circumstances, the Commission was entitled to find that both types of gadolinium have sufficiently different characteristics to justify a difference in treatment. The Commission thus did not infringe the principle of equal treatment and non-discrimination.
The applicant sees a second case of discrimination in the fact that, in the contested decision, the Commission suspended the MA for Omniscan and not the MA for Magnevist (gadopentetic acid), even though they are both linear gadolinium-containing contrast agents. As regards Magnevist, the contested decision merely states in Article 4 that the Member States must take into account the CHMP’s scientific findings when evaluating the effectiveness and safety of contrast agents containing gadopentetic acid.
The applicant claims that, since there is no evidence that the retention of linear gadolinium in the brain causes harm, there is no objective justification for distinguishing between Magnevist and other linear gadolinium-containing contrast agents such as Omniscan, on the sole ground that Magnevist is prescribed in smaller doses.
As has already been stated in paragraphs 71 and 73 above, in the light of the scientific data, the PRAC was able to find that there is serious and conclusive evidence that the accumulation of linear gadolinium in the brain presents a risk of neurotoxicity. In its second recommendation, the PRAC also observed that studies had shown that Magnevist was, as with Omniscan, detected in the brain after being administered. Nevertheless, the PRAC also noted that Magnevist was used as a contrast agent in arteriography at a dose 200 times lower than other agents injected intravenously, such as Omniscan. Furthermore, the PRAC noted that, in that case, patients were usually exposed to that product only once, whereas they may be exposed to Omniscan on several occasions.
On the basis of that difference in the administration of the two products, the PRAC, the CHMP and, after them, the Commission, were able to adopt different approaches, in particular distinguishing Magnevist and Omniscan, and to find, without infringing the principle of equal treatment and non-discrimination, that it was necessary only to invite Member States to take into account the finding that the risk–benefit balance of Magnevist remained positive in the event of an intra-articular injection.
The applicant sees a third case of discrimination in the fact that, in the contested decision, the Commission suspended the MA for Omniscan and not the MA for Multihance and for Primovist (gadoxetic acid) even though they are all linear gadolinium-containing contrast agents. As regards Multihance and Primovist, the contested decision merely provides, in Article 4, that the Member States must take into account the CHMP’s scientific findings in order to assess the effectiveness and safety of contrast agents containing gadobenic acid or gadoxetic acid.
The applicant submits, in that regard, that in so far as the PRAC and the CHMP took the view that the risk–benefit balance of Multihance and Primovist is favourable due to their usefulness in hepatic imagery, it was discriminatory not to treat as similarly beneficial Omniscan’s specific indication for myocardial perfusion imaging.
It must be observed that that complaint is based on the premiss that Omniscan is of particular importance for myocardial perfusion imaging. The PRAC and the CHMP disputed that and it must be recalled (see paragraph 99 above) that it is not for the Court to settle the scientific dispute between the parties as to whether, inter alia, there are significant differences between ‘whole-body’ imaging and myocardial perfusion imaging. Furthermore, it follows from the examination of the first two pleas in law (see paragraphs 113–117 above) that it is not established that the PRAC erred in finding that a ‘whole-body’ indication covered the indication for myocardial perfusion imaging granted to Omniscan in four Member States.
On the other hand, the PRAC noted that Multihance and Primovist were beneficial for delayed phase imaging of poorly vascularised hepatic lesions, which could not be achieved with other gadolinium-based products and thus allowed early diagnosis of potentially life threatening diseases. In those circumstances, and in spite of the risks caused by the accumulation of gadolinium in the brain, the PRAC considered that the risk–benefit balance of those two products remained favourable, provided that their use was limited to that type of liver imaging.
In that context, in the light of their different qualities, it does not appear that the principle of equal treatment and non-discrimination was infringed by the fact that Multihance and Primovist were treated differently to Omniscan.
The applicant submits that there is a fourth case of discrimination in the fact that, although the purpose of the contested decision is to reduce the risk to human health, it favours macrocyclic gadolinium-containing contrast agents over linear gadolinium-containing contrast agents in the light of a hypothetical risk of neurotoxicity, without taking into account the fact that linear gadolinium-containing contrast agents, and Omniscan in particular, have a more favourable safety profile in respect of the risks of acute hypersensitivity reactions which, although slight, are nevertheless real.
However, first of all, it should be noted that neither the PRAC nor the CHMP, nor the Commission considered that the risk of neurotoxicity of linear gadolinium-containing contrast agents is hypothetical. In accordance with the CHMP’s opinion, to which it refers in the contested decision, the Commission considered that the neurotoxicity of those contrast agents is possible.
Consequently, it does not appear that the Commission, in the contested decision, infringed the principle of equal treatment and non-discrimination by treating macrocyclic gadolinium-containing contrast agents differently to linear gadolinium-containing contrast agents, since the latter have different properties.
In the light of all of the foregoing, the third plea in law is unfounded
The applicant submits that the contested decision infringes the general principle of proportionality, even if it were to be found that the risk–benefit balance of linear gadolinium-containing contrast agents is not favourable.
In support of its plea in law, the applicant submits, in the first place, that the suspension of the MA for Omniscan was unnecessary. The applicant points out, in that regard, that the Commission took the view that labelling and warnings were sufficient to neutralise the real risks of nephrogenic systemic fibrosis and acute hypersensitivity reactions which all gadolinium-containing contrast agents entail, but that it ordered, in a contradictory manner, the suspension of the MAs for linear gadolinium-containing contrast agents in order to prevent a mere hypothetical risk associated with the retention of those agents in the brain.
As regards any updating of information on Omniscan, the PRAC took the view that, since the accumulation in the brain was an intrinsic property of gadolinium-containing contrast agents administered intravenously, information in that regard would not lead to a reduction of the risks associated with that accumulation.
The PRAC also noted that it was not possible to restrict the use of Omniscan to certain groups of patients, as has been the case for the risk of nephrogenic systemic fibrosis, or as proposed by 19 Member States, Iceland and Norway, given that no patient group with less risk of accumulation in the brain could currently be identified.
The PRAC also took the view that, in a clinical context, it was not realistic to wish to restrict the number of doses administered to a patient during his life or to take measures regarding the frequency and timing of the applications because exposure to gadolinium may not be recorded, in particular when there is a change of radiologist or general practitioner.
It follows from the foregoing considerations that Professor T.’s participation in the expert group was not decisive for either the conduct or the outcome of the procedure which led to the contested decision. Thus, that participation does not lead to a finding that the procedure, assessed as a whole, did not offer sufficient guarantees to exclude any legitimate doubt as to Professor T.’s impartiality.
The applicant claims, first, that the grounds which it had submitted in support of its request for re-examination were not taken into account. It submits, second, that the factual errors relating to the specific Omniscan indication for myocardial perfusion imaging, brain gadolinium levels, retention times for gadolinium in the brain and contrast agent posology were not corrected. It argues, third, that the competent bodies did not take a view on the issues relating to MRI study limitations, inconsistencies in the appraisal of data and the PRAC’s apparently held belief that certain publications had been sponsored by MA holders.
In any event, it is apparent from the file that the applicant’s request for re-examination led to the convening of the meeting of an expert group. The grounds put forward by the applicant in support of that request were assessed and discussed by the rapporteur and co-rapporteur in their assessment reports of 28 June 2017. In particular, it has been found in paragraphs 111, 113 and 117 above that the PRAC had re-examined its first recommendation regarding the usefulness of Omniscan for myocardial perfusion imaging in the light of the grounds of the applicant’s request for re-examination and that the alleged error made in that regard in the light of the MA issued by the German institute to Gadovist for the whole-body was not established. Furthermore, the CHMP also carried out an examination of the risk–benefit balance of gadolinium and did qualify the PRAC’s second recommendation (see paragraph 79 above).
DANISH EASTERN HIGH COURT – 29 August 2019
Case BS-41319/2018-SHR – Sandoz vs. Gilead
Recovering legal cost – ‘Necessary for the adequate conduct of the case’ – New precedent
In a decision issued on 29 August 2019 by the Danish Eastern High Court, the companies Gilead and Sandoz who had been in a legal dispute over a potential infringement of Gilead’s patent for the products ‘Emtricitabin and Tenofovirdisoproxil (as fumerat)’.
Gilead was granted a preliminary injunction, which Sandoz appealed.
During these appeal, Gilead’s patent was declared invalid in a separate case against a third party.
Sandoz therefore brought a separate motion before the Maritime and Commercial High Court (MCHC) to avoid the preliminary injunction.
Sandoz won the motion. Sandoz incurred actual documented costs of DKK 754,265 (approx. 100 000 euros), the majority of which were legal fees, while the rest were costs incurred by expert statements, including from European Patent Attorneys.
The MCHC granted Sandoz a costs award of DKK 60,300.
In other words, Sandoz, as the winner of the lawsuit, was able to recover less than 8% of its actual costs.
Sandoz appealed the judgment on costs recovery to the Danish Eastern High Court. The appeal included an assessment of the total recovery of costs incurred in the connected suits between Sandoz and Gilead, including the appeal before the High Court.
The High Court held that the losing party, Gilead, should reimburse Sandoz for 49.5% of its legal costs and 100% of the costs spent on European Patent Attorneys.
This new 2019 decision issued by the Eastern High Court in the case of Sandoz vs. Gilead is likely to set a new precedent in Denmark for the recovery of legal costs and European Patent Attorneys’ fees in particular.
The practice in Denmark is that the losing party in a lawsuit is required only to reimburse the winner for costs ‘which have been necessary for the adequate conduct of the case’ – and this assessment is left to the court’s discretion.
Therefore, costs awards are therefore generally granted for amounts far less than the actual costs incurred.
Prior to these two decisions, costs incurred by a party’s use of European Patent Attorneys as expert advisers were considered recoverable only to the extent the costs had been ‘necessary for the adequate conduct of the case’.
In the recent 2019 decision, the High Court considered article 14 of Directive 2004/48 on the enforcement of intellectual property rights in light of the CJEU’s recent decision in case C-57/15, United Video Properties Inc., and found that all European Patent Attorneys’ fees should be refunded.
The case is a step in the right direction for the recovery of European Patent Attorneys’ fees in Denmark.
ORCID iD
Séverine Charbonnel https://orcid.org/0000-0002-5873-0351