Speciality European Pharma Ltd v Doncaster Pharmaceuticals Group Ltd and Another
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Asplin |
| Judgment Date | 20 November 2013 |
| Neutral Citation | [2013] EWHC 3624 (Ch) |
| Docket Number | Case No: HC12B02174 |
| Court | Chancery Division |
| Date | 20 November 2013 |
[2013] EWHC 3624 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
INTELLECTUAL PROPERTY
Royal Courts of Justice
Strand, London, WC2A 2LL
Mrs Justice Asplin
Case No: HC12B02174
Mark Brearely QC and Nicholas Saunders (instructed by Devonshires) for the Claimants
Martin Howe QC and Iona Berkeley (instructed by Maitland Walker) for the First Defendant
Approved Judgment
Hearing dates: 29, 30 and 31 October and 1 November 2013
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
This case is concerned with the issues of parallel imports and re-branding in relation to a pharmaceutical product containing the active ingredient trospium chloride.
The Claimant, Speciality European Pharma Limited, (SEP) specialises in the distribution and sale of pharmaceutical products, particularly in the fields of urology and urogynaecology. The second defendant, Madeus GmbH (Madeus), manufactures trospium chloride and held the patent to trospium chloride until 2009 when it expired. Among other things, Madeus markets and distributes trospium chloride products in various European countries. It is marketed in France as Céris, in Germany as uriVesc and in the United Kingdom as Regurin. On 7 May 2009, Madeus appointed SEP as exclusive licensee of the Regurin trade mark in the United Kingdom and Ireland and thereafter, SEP took over distribution of the 20mg Regurin product from the previous UK distributor, Galen Pharmaceuticals Limited (Galen). SEP launched the 60mg product in the United Kingdom in September 2009.
I should make clear that no relief is sought against Madeus and it was not represented before me. However, it was joined as a party to these proceedings and accordingly, will be bound by this decision.
The first defendant, Doncaster Pharmaceuticals Group Limited, (Doncaster) is a parallel importer of pharmaceuticals. It is not disputed that for many years it imported Céris into the United Kingdom from France by overstickering the box with the name of the generic active ingredient, trospium chloride. In late 2009, Doncaster started to import Céris by affixing the trademark Regurin instead. Thereafter, in 2011, Doncaster started to import uriVesc into the United Kingdom from Germany and to re-brand it as Regurin.
The question with which the Court is concerned is whether Doncaster is entitled under Articles 34 and 36 of the Treaty on the Functioning of the European Union (TFEU) to affix the Regurin mark to the pharmaceuticals which they import from other Member States in the European Union. Is it necessary for Doncaster to re-brand the products as Regurin in order to gain effective market access to the United Kingdom?
In summary, SEP argues that it is not necessary to use the trade mark Regurin in order to sell the parallel import in the United Kingdom. Doncaster on the other hand, contends that Regurin is in its own market and accordingly, it is entitled to use the brand name to gain effective market access. Doncaster also contends that by such means it is able to gain access to the wider market of prescriptions written by reference to the generic name trospium chloride because Regurin or any other brand name can satisfy prescriptions written generically.
The Relevant Law
The issues in this case arise as a result of Article 34 TFEU which provides that:
"Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between Member States."
Article 36 of the TFEU provides that the provisions contained in Articles 34 and 35 shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on a number of grounds including the protection of industrial and commercial property. However, the final sentence of Article 36 states:
"Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States."
Article 5 of the Trade Marks Directive (as implemented in sections 9 and 10 of the Trade Marks Act 1994) provides that the proprietor of a mark has exclusive rights which may be infringed by use of that trade mark in the United Kingdom without his consent. A person uses a sign if, among other things, he affixes it to goods or their packaging and he infringes unless he can establish a defence. There are limitations on the effect of a registered trade mark and in particular those relating to exhaustion which are dealt with in Article 7 of the Directive (as implemented in section12 TMA 1994.) Article 7 provides as follows:
"1. The trade mark shall not entitle the proprietor to prohibit its use in relation to goods which have been put on the market in the Community under that trade mark by the proprietor or with his consent.
2. Paragraph 1 shall not apply where there exist legitimate reasons for the proprietor to oppose further commercialization of the goods, especially where the condition of the goods is changed or impaired after they have been put on the market."
Although not directly relevant here, Article 7 has been the subject of detailed consideration by the European Court of Justice (the ECJ) in the context of re-boxing of pharmaceutical products. In Bristol-Myers Squibb & Ors v Paranova A/S,20 [1997] 1 CMLR 1151, the ECJ summarised the previous case law and set out five conditions which a parallel importer must establish in order to avoid infringement. They have become known as the 'BMS Conditions'. They are as follows:
"… Article 7(2) of Directive 89/104 must be interpreted as meaning that the trade mark owner may legitimately oppose the further marketing of a pharmaceutical product where the importer has repackaged the product and reaffixed the trade mark unless:
[1] it is established that reliance on trade mark rights by the owner in order to oppose the marketing of repackaged products under that trade mark would contribute to the artificial partitioning of the markets between Member States; such is the case, in particular, where the owner has put an identical pharmaceutical product on the market in several Member States in various forms of packaging, and the repackaging carried out by the importer is necessary in order to market the product in the Member State of importation, and is carried out in such conditions that the original condition of the product cannot be affected by it; that condition does not, however, imply that it must be established that the trade mark owner deliberately sought to partition the markets between Member States;
[2] It is shown that the repackaging cannot affect the original condition of the product inside the packaging; …
[3] the new packaging clearly states who repackaged the product and the name of the manufacturer in print such that a person with normal eyesight, exercising a normal degree of attentiveness, would be in a position to understand; …
[4] the presentation of the repackaged product is not such as to be liable to damage the reputation of the trade mark and of its owner; thus, the packaging must not be defective, of poor quality, or untidy;
and
[5] the importer gives notice to the trade mark owner before the repackaged product is put on sale, and, on demand, supplies him with a specimen of the repackaged product."
In relation to re-branding with which this case is concerned, Mr Brealey QC referred me to Pharmacia & Upjohn SA v Paranova A/S (Case C-379/97) [2000] 1 CMLR 51 where the ECJ considered a case in which the brand of a product was changed by a parallel importer. In that case Upjohn marketed an antibiotic using the trade mark 'Dalacin' in Denmark, Germany and Spain, 'Dalacine' in France and 'Dalacin C' in other Member States of the European Union. The Defendant, Paranova A/S, a well known parallel importer, purchased capsules of the antibiotic in France which had been placed on the market under the trade mark 'Dalacine' and injection phials which were placed on the market in Greece as 'Dalacin C'.
Subsequently, it imported both into Denmark and marketed them under the trade mark 'Dalacin'. Upjohn obtained an injunction under Danish law to prevent Paranova from selling the imported drugs under the trade mark. The injunction was challenged on the basis that the marketing system adopted by Upjohn amounted to an artificial partitioning of the market as referred to by the ECJ in the Bristol Myers Squibb case. As a result, the Danish court referred the question of whether Article 7 of Directive 89/104 precluded the proprietor of a trade mark from relying on its rights under national trade mark law to oppose a third party's purchase of a product in a Member State, repackaging it, affixing a trade mark belonging to the proprietor and importing it into another Member State, where the trade mark affixed to the product by the third party was that used by the trade mark proprietor in the country of import, to the ECJ.
The ECJ stated at [28] of the Judgment that Article 7 of the Directive does not apply in the situation where the parallel importer replaces the original trade mark with another mark. In such a case the respective rights of the proprietor of the trade mark and the parallel importer are to be determined by Articles 34–36 TFEU.
However, at [30] the ECJ concluded as follows:
" … Article 7 of the Directive, like Article 36 of the Treaty, is intended to reconcile the fundamental interest in protecting trade mark rights with the fundamental interest in the free movement of goods within the common market: it follows that those two provision which pursue the same result, must be interpreted in the same way."
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