E-News No.46

E-News No.46

TRIPS Agreement Influenced Interpretation of Patent Law in Finnish Patent Dispute

by Jukka Palm (Berggren Oy Ab – Finland)

The Finnish Market Court applied the TRIPS -agreement in a temporary injunction matter (No. 821/15) relating to an alleged likely patent infringement by offering for sale, placing on the market or using a generic drug substance.

Merck Sharp & Dohme Corp. and MSD Finland Oy v. Sandoz A/S, http://www.markkinaoikeus.fi/fi/index/paatokset/teollisjatekijanoikeudellisetasiat/teollisjatekijanoikeudellisetasiat/1448436743507.html

According to the Finnish Patent Act, Section 57a “should the patent have been granted to a method for the manufacture of a new product, the new identical product that has been produced without the consent of the proprietor of patent must be considered have been produced by the patented method unless otherwise proven” i.e. the burden of proof is reversed. One of the questions was whether this point of the law was, in accordance with the TRIPS Agreement, applicable in proceedings related to temporary injunction.

The applicants in the case were Merck Sharp & Dohme Corp. and MSD Finland Oy while the adverse party was Sandoz A/S. Merck Sharp & Dohme (owner of a Finnish patent number FI 110321, European patent EP 1137634) and MSD Finland Oy had previously successfully applied for a temporary injunction against Sandoz A/S. Now the case had moved to the next phase which is an application for a final decision on the temporary injunction matter.

The Market Court reviewed whether Sandoz had violated the supplementary protection certificate number 233 of the applicant’s patent and the applicant’s European patent EP 1137634 in its production of a generic drug substance, ezetimibe. Sandoz A/S contested the infringement claim and insisted that it uses a so-called DR – method, which does not infringe the patents in question, to manufacture the product.

According to the applicants the reversed burden of proof should be applied in the case, whereas the adverse party disagreed. According to the court infringement was uncertain in relation to a European patent and the application did not succeed in this regard. However, the situation was different in respect of the supplementary protection certificate 233 relating to a Finnish patent.

Despite expert opinions the court could not reach a satisfactory conclusion regarding whether the infringement was likely or not. Additionally Sandoz A/S was unable to prove how much of its total ezetimibe production and shipments to Finland were produced using the DR – method.

The Market Court ruled that the burden of proof was reversed due to Patents Act, Section 57a. As Sandoz had failed to meet the requirement set by the law, the court ruled in the favour of the applicants.

Sandoz A/S had also argued that the said reversed burden of proof would not be applicable in temporary injunction proceedings. The Market Court rejected the argument stating that the wording in the Finnish Patent Act or previous national case law does not support this view. Moreover, the Article 34 of TRIPS Agreement obligates the member states to ensure that “the judicial authorities shall have the authority to order the defendant to prove that the process to obtain an identical product is different from the patented process.”

The Market Court considered that contrary to the claims by Sandoz A/S the TRIPS Agreement did not contain any specific restriction according to which the reversed burden of proof in Article 34 could not be applied in temporary injunction proceedings.

The Market Court ordered Sandoz not to offer or trade or use the drug Sandoz Ezetimibe 10 mg in Finland and set a EUR 500 000 periodic penalty payment to ensure compliance with the prohibition.