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Brand Drug Owners Vindicated Against Generics Seeking to Launch Without Declaring Relevant Patents Under Patent Linkage Regime

By Denise Mirandah

 

INTRODUCTION

The Singapore Court of Appeal’s judgment in Millennium Pharmaceuticals, Inc v Drug Houses of Australia Pte Ltd [2019] SGCA 31 heralds momentous change in the pharmaceutical sector for brand drug owners seeking to enforce patents against generic competitors. The Court reversed an interlocutory decision of the High Court that made it difficult for brand drug owners to bring patent infringement actions against generic companies seeking to launch without declaring relevant patents under Singapore’s patent linkage regime.

BACKGROUND

Singapore has a patent linkage system whereby marketing approval for drugs is linked to whether there is a relevant patent in force corresponding to the originator’s drug. If there is a relevant patent, applicants are required to declare it to the Regulatory Authority[1]. In the declaration, the applicant may state, among various possibilities, that the patent is invalid and/or will not be infringed. Where it does so, the Authority will generally require the applicant to notify the patentee of its product application. The patentee has 44 days from being notified to commence legal action to defend its patents; for example, by seeking a declaration of or injunction restraining infringement. If the patentee commences action in time, it will get a 30‑month moratorium during which the Authority will not grant marketing approval for the drug.

Here, the facts fairly implied that the generic applicant, Drug Houses of Australia (“DHA”), did not declare patents held by Millennium Pharmaceuticals (“Millennium”) covering manufacturing processes for its blockbuster cancer drug, bortezomib, which Millennium argues are relevant patents. Due to DHA’s non-declaration, the Authority approved the drug without requiring DHA to notify Millennium. This deprived Millennium of a chance to take action during the course of DHA’s application to defend its patents.

PROCEDURAL HISTORY

Millennium sued DHA in the High Court for, among other things, threatened and actual patent infringement. Millennium also applied for an interim injunction restraining DHA from launching its drug. DHA challenged the injunction application and sought to strike out the infringement claims for disclosing no reasonable cause of action.

The High Court struck out the infringement claims. The Court found no basis for threatened infringement as the action was, on interpreting the relevant regulations[2], contingent on the Authority directing DHA to notify Millennium of its product application. No statutory notice was required to be served here. The High Court also struck out the actual infringement claim because no particulars of infringement were pleaded. The High Court also dismissed Millennium’s application for an interim injunction. It found that there was no serious case to be tried because the infringement claims were struck out; and damages were on the evidence, an adequate remedy.

APPEAL

Millennium appealed against the High Court’s decision to the Court of Appeal.

Striking Out

The Court of Appeal reversed the High Court’s decision and reinstated the infringement claims.

The Court observed that the relevant regulations[3] allow a patentee to apply to the Authority to cancel a product registration if it gets a legal determination[4] on certain specified matters, including that an act authorised by a product registration infringes its patent[5]. This showed that the court[6] had a legal basis to determine whether an act authorised by a product registration (e.g. importing a generic drug) infringes a patent. This was irrespective of whether the allegedly infringing act was threatened or already committed. In short, there was a reasonable basis for threatened infringement (even if a statutory notice was not served on the patentee) and actual infringement. The Court added that particulars of infringement could be provided subsequently after discovery and/or interrogatories.

The Court rejected DHA’s argument that this would enable abuse by patentees who missed the 44‑day deadline to defend their patents. A patentee who missed the deadline risked a generic competitor entering the market as he has lost the chance to delay or stop the generic’s product application (e.g. by a moratorium). There is no abuse in a patentee seeking to have the product registration cancelled if it can obtain a determination on infringement or on other specified matters (i.e. that the applicant made a patent declaration that was materially false or misleading[7]).

Interim Injunction

As the Court found a reasonable cause of action for infringement, it disagreed with the High Court that there was no serious case to be tried. However, the Court of Appeal agreed that there was no credible evidence at this stage on why damages would be an inadequate remedy. Among other things, any damages suffered would be quantifiable as the buyers of bortezomib were hospitals which would have proper records of purchases. The Court also held that Millennium could restore monopoly prices if it succeeds at trial against DHA. Any price cut caused by DHA’s entry would not be irreversible as Millennium would still hold the monopoly for bortezomib, and the hospitals would likely still need the drug. Accordingly, the Court dismissed the injunction application, subject to its finding that there was still a serious case to be tried.

CONCLUDING REMARKS

This case is a landmark decision which changes the patent landscape in Singapore for pharmaceuticals. The Court of Appeal’s decision indicates preliminarily[8] that patentees will not be deprived of a remedy for patent infringement even if a generic does not declare a relevant patent.

[1] The Health Sciences Authority of Singapore.

[2] Regulation 23 of the Health Products (Therapeutic Products) Regulations 2016.

[3] Regulation 24(1) of the Health Products (Therapeutic Products) Regulations 2016.

[4] By a court or the Registrar of Patents or a Deputy Registrar of Patents.

[5] The relevant regulations also allow a patentee to apply to the Authority to cancel a product registration if it gets a legal determination that the applicant’s patent declaration to the Authority was materially false or misleading.

[6] Or the Registrar of Patents or Deputy Registrar of Patents.

[7] See footnote 5 above.

[8] This issue may be further litigated and resolved at trial.