Restricting Pharma Supplies and Abuse of Dominant Position
| DOI | 10.1093/jiplp/jpn095 |
| Pages | 434-438 |
| Date | 01 July 2008 |
| Year | 2008 |
| Published By | Oxford University Press |
‘the exempt status of each study [or use of the patented
invention] for which question has reasonably been raised’.
On the second question, the CAFC reversed the
USITC—holding that the USITC has the power to stop
imports even without a sale. Here, the court looked past
the USITC’s specific patent provisions and instead con-
sidered the USITC’s power to ‘prevent every type and
form of unfair practice’. The appellate panel also found
that the limited remedial power of the USITC warrants
early action. In this vein, the court opined that the com-
mission should be allowed more latitude in acting early to
prevent harm since the agency has now power to order
compensatory damages.
Dissent
One member of the three judge panel, Judge Linn, dis-
sented from the majority’s conclusion on the initial ques-
tion. Although Judge Linn professed sympathy for the
majority’s desire to create a broad safe harbour and to
support uniformity between the various acts, he did not
support the majority’s statutory interpretation. In a
classic statement of statutory interpretation, the dissent
looked to the words of the law rather than the intent of
the lawmakers: ‘While I agree that it would make sense
for section 337 to apply that way, the problem remains
that if that is what Congress intended, it is not what Con-
gress unambiguously said’. In particular, Judge Linn noted
that the Patent Act’s safe harbour applies to acts of
‘infringement’ whereas section 337 explicitly allows for
the USITC to enjoin activities that would not traditionally
be considered infringement.
Practical significance
There are a number of reasons why the USITC is becom-
ing a popular forum for patent enforcement actions.
Although damages are not available, these cases generally
move quickly and, when successful, result in injunctive
relief. In addition, America’s continual and increasing
reliance on foreign manufactured goods increases the pool
of potential USITC defendants.
This decision has two direct implications. First, multi-
national pharmaceutical companies can import potentially
infringing products to be used for FDA approval without
fear of facing patent infringement litigation—so long as
the imported products are only used for purposes associ-
ated with the FDA approval process. This allows compa-
nies to take steps towards pursuing a US market without
having to invest in US production facilities.
Second, the CAFC indicated its support for USITC
orders to pre-empt harm—thus allowing patent holders
to file cases earlier in the process. This outcome is
roughly parallel to the recent Supreme Court case of Med-
Immune v Genetech, 127 S. Ct. 764 (2007). That case
expanded the definition an ‘actual controversy’ used to
determine when a patent action is ripe for adjudication in
a district court. On the basis of this second result,
we should expect to see the number of USITC actions
continue to rise.
Dennis Crouch
University of Missouri Law School
www.patentlyo.com
Email: dcrouch@patentlyo.com
doi:10.1093/jiplp/jpn088
General
BRestricting pharma supplies and abuse of
dominant position
Sot. Le
´los kai Sia (Syfait II) Joined Cases C-468/06 to
C-478/06, European Court of Justice, Opinion of Advocate
General Colomer, 1 April 2008
The refusal by a dominant undertaking to supply
pharmaceutical products in order to restrict parallel
trade is likely to constitute the abuse of a dominant
position under Article 82 of the EC Treaty, according to
Advocate General Colomer in Syfait II. Although such a
refusal is capable of objective justification, the Advocate
General suggests that this is unlikely despite the
interference by Member States with pharmaceutical
pricing, disagreeing in this respect with Advocate
General Jacobs.
Legal context
Although the EC Treaty does not explicitly prohibit
restrictions on parallel trade within the Community, it
has been established since the judgment of the European
Court of Justice (ECJ) in Consten and Grundig in 1966
that agreements which seek to restrict parallel trade are
likely to be regarded as anticompetitive under Article 81
of the Treaty (Joined Cases 56/64 and 58/64 Consten and
Grundig v Commission [1966] ECR 299 Spec Ed). The
European Commission, when it has considered the ques-
tion, has also taken the view that unilateral attempts to
restrict parallel trade constitute abusive conduct under
Article 82 of the EC Treaty and are thus prohibited where
the undertaking involved holds a dominant position on
the relevant market (Polaroid/SSI Europe, Thirteenth
Report on Competition Policy (1983), points 155– 157;
Commission Decision 88/138 Eurofix-Bauco v Hilti [1988]
OJ L 65/19).
Journal of Intellectual Property Law & Practice, 2008, Vol. 3, No. 7434 CURRENT INTELLIGENCE
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