The Secretary of State for Health and Another v Servier Laboratories Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Roth |
| Judgment Date | 21 February 2022 |
| Neutral Citation | [2022] EWHC 369 (Ch) |
| Docket Number | Case Nos: HC-2011-000064 HC-2012-000188 |
| Court | Chancery Division |
[2022] EWHC 369 (Ch)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS
OF ENGLAND AND WALES
COMPETITION LIST (ChD)
Rolls Buildings, Fetter Lane
London, EC4A 1NL
Mr Justice Roth
Case Nos: HC-2011-000064
HC-2012-000189
HC-2012-000188
Jon Turner QC and Josh Holmes QC for the Claimants collectively
David Drake and Philip Woolfe (instructed by Peters & Peters Solicitors LLP) for the English Claimants
Julian Gregory and Alexandra Littlewood (instructed by RPC LLP) for the Scottish / NI Claimants
Laura Elizabeth John and Ciar McAndrew (instructed by Geldards LLP) for the Welsh Claimants
Nicholas Saunders QC, Daniel Piccinin and Emma Mockford (instructed by Sidley Austin LLP) for the Defendants
Hearing dates: 17–18, 21–25, 28–30 June, 1–2, 5–7, 14–15 July 2021
Approved Judgment
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.
CONTENTS
| Paragraph | |
| Introduction | 1 |
| The Prescribing Argument | 16 |
| The Preliminary Issues | 24 |
| The Health Services | 33 |
| England | 34 |
| Wales | 37 |
| Scotland | 40 |
| Northern Ireland | 43 |
| The Trial | 52 |
| The factual witnesses | 54 |
| The expert witnesses | 58 |
| ACEIs | 65 |
| Clinical drug trials | 77 |
| Patents | 88 |
| Drug and Prescribing Guidance and Information | 98 |
| Servier's Claims for and Promotion of Perindopril | 149 |
| Issues (A)-(B) | 169 |
| Initiation | 185 |
| Primary care | 186 |
| Secondary care | 194 |
| Switching | 217 |
| Conclusion on issues (A)-(B) | 230 |
| Issue (C) | 233 |
| The law | 235 |
| The factual context | 250 |
| The alleged failures | 269 |
| National level guidance | 270 |
| England | 271 |
| Scotland | 284 |
| Wales | 297 |
| Northern Ireland | 306 |
| Local formularies | 308 |
| Local guidance | 318 |
| The QOF and local programmes | 325 |
| ScriptSwitch | 364 |
| Servier's FI Response | 377 |
| Conclusion on issue (C) | 386 |
| Postscript | 392 |
INTRODUCTION
These three actions, which are being heard together, are claims for damages brought on behalf of, respectively (i) the English health authorities, (ii) the Welsh health authorities, and (iii) the Scottish and Northern Irish health authorities. It is convenient to refer to them, save where further elaboration is required, as the English Claimants, the Welsh Claimants, the Scottish Claimants and the NI Claimants, and to the respective authorities compendiously as the English NHS, Welsh NHS, Scottish NHS and N Irish NHS. They were referred to together, in a nomenclature I shall adopt, as “the four nations.”
This judgment follows the trial of preliminary issues. To explain the nature of those issues and how they arise, it is necessary to describe the background and substance of the proceedings in some detail.
The proceedings concern a pharmaceutical prescription-only drug, perindopril. It is an angiotensin-converting enzyme (“ACE”) inhibitor (“ACEI”) used in the treatment of a number of conditions.
The First and Second Defendants are English companies and the Third and Fourth Defendants are French companies. The Fourth Defendant is the parent company of the Servier group and the other Defendants are, directly or indirectly, its subsidiaries. I shall refer to the First Defendant as “SLL”, to the Third Defendant as “LLS” and to the Defendants compendiously, save where it is necessary to distinguish between them, as “Servier.” Perindopril, marketed under the brand name “Coversyl”, was a major product of Servier in the period with which these proceedings are concerned, i.e. 2003–2009 (“the Relevant Period”).
Both during and since that time, there has been significant reorganisation of the health authorities in all the four nations. The present claimants are, as appropriate, the successors to the relevant health authorities responsible for payment or purchasing of prescription medicines in each of the four nations over the Relevant Period.
Supply of Coversyl, protected by European patents with a UK designation, began on the UK market in about 1990, after Servier obtained a UK marketing authorisation. The present actions relate to a patent which was granted to LLS for the alpha crystalline form of the perindopril salt: EP No 1 296 947 (the “947 Patent”) which had, among others, a UK designation. The application for the 947 Patent was filed at the European Patent Office (the “EPO”) on 6 July 2001 and the patent was granted on 4 February 2004. The patent was opposed by ten opponents and following the hearing of the opposition on 27 July 2006, the Opposition Division of the EPO decided to maintain the patent. SLL was the exclusive licensee under the UK designation of the 947 Patent.
LLS and SLL obtained interim injunctions in the Patents Court, on the basis of the 947 Patent, against a number of generic companies seeking to enter the UK market with generic perindopril. One of those generic companies was Apotex, but following the subsequent substantive trial, the Court held on 11 July 2007 that the 947 Patent was invalid: [2007] EWHC 1538 (Pat). Servier's appeal against that decision was dismissed: [2008] EWCA Civ 445. Those decisions of course only applied to the UK designation of the European patent.
In the meantime, an appeal was proceeding before the EPO Technical Board of Appeal. By a decision dated 6 May 2009, the Board of Appeal revoked the European 947 Patent.
The present proceedings allege a series of infringements of both EU and UK competition law. In particular, it is alleged that Servier entered into a series of agreements with generic manufacturers and suppliers not to enter the market with a generic version of perindopril and/or to withdraw their challenges to Servier's patent; and that those agreements constituted an infringement of Art 101 of the Treaty on the Functioning of the European Union (“TFEU”) and/or the equivalent s. 2 of the Competition Act 1998 (“CA”), and also an abuse of a dominant position which Servier held in the UK, and therefore an infringement of Art 102 TFEU and/or the equivalent s. 18 CA. Moreover, the claims allege that LLS obtained the grant of the 947 Patent, and further successfully defended it in opposition proceedings, by misleading or dishonest misrepresentations made to the EPO; and that LLS and SLL further repeated or relied on those misrepresentations in obtaining interim relief in the English courts. That alleged conduct, which is expressly pleaded as constituting deceit, is said to be a separate abuse of Servier's dominant position and thus contrary to Art 102 TFEU and/or s. 18 CA. Further and alternative grounds of abuse are alleged on the basis that the conduct of LLS and/or SLL by which they “obtained, defended and enforced” the rights in relation to the 947 Patent was unreasonable or an abuse of process, and that Servier was “not transparent in its provision of relevant information to the EPO and courts”.
In the proceedings brought by the English Claimants, there was also a claim for the economic tort of unlawful means, but that has been struck out and is no longer relevant. For the purpose of the preliminary issues, it is unnecessary to distinguish between the three sets of proceedings, and all references to the pleadings will be to the statements of case in the English action.
Following the commencement of these proceedings, on 9 July 2014, the European Commission adopted a decision (“the EC Decision”) addressed to SLL, LLS and the Fourth Defendant finding that they had contravened Arts 101 and 102 TFEU by reason of various agreements made with generic manufacturers and suppliers involving patent settlements or the acquisition of technology, and imposing very substantial fines: Case AT.39612 Perindopril (Servier). From that point, these proceedings became in part ‘follow-on’ actions, relying on the EC Decision.
On 12 December 2018, the EU General Court largely dismissed Servier's appeal against the Art 101 infringement (save in respect of agreements made with one of the generic companies, Krka) but allowed the appeal against the finding that Servier was dominant on the relevant market and accordingly annulled the EC Decision as regards an infringement of Art 102: Case T-691/14 Servier v Commission, EU:T:2018:922 (“the General Court judgment”). Appeals by both the EU Commission and Servier against the General Court judgment are still pending before the Court of Justice of the EU (the “CJEU”): Case C-176/19P (the Commission's appeal) and Case 201/19P (Servier's appeal). Unless the General Court judgment is reversed as regards the finding of dominance, the Claimants accept that they cannot proceed with the Art 102/s. 18 claim. However, the distinction between the Art 101 and Art 102 claims are not material for present purposes.
On the trial of a previous preliminary issue, this court held that the findings of the General Court on market definition are not res judicata for the purpose of the present proceedings: [2019] EWHC 1004 (Ch). Servier's appeals against that decision were dismissed by the Court of Appeal [2019] EWCA Civ 1096 and the Supreme Court [2020] UKSC 44.
The claims allege that by reason of...
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