On 27 January 2021, the German Parliament discussed a draft law that would limit a patent owner’s ability to stop the production and distribution of an infringing product. The new law would enable the infringer to rely on a defence of “disproportionate hardship” against an otherwise justified cease-and-desist claim. While the German Association of the Automotive Industry welcomes these changes, citing “unreasonable” royalty demands for standard essential patents for information and communications technology used in cars, the Association of the German Chemical Industry (VCI) and the Association of Research-Based Pharmaceutical Companies (VFA) have argued in a joint statement that the proposed changes go too far.

Scope of the Proposed Disproportionality Defence

The German Federal Government intends to amend several intellectual property laws by the “Second Act on the Simplification and Modernisation of Patent Law”. While the proposed amendments mostly relate to procedural and cost provisions, the draft would also modify the substantive law on a patent owner’s cease-and-desist claim against an infringer.
Continue Reading German Patent Law Reform Would Introduce “Disproportionality” Defence

In its 7 July 2016 Genentech judgment (Case C-567/14), the European Court of Justice (“ECJ”) ruled that Genentech had to pay royalties to Sanofi-Aventis Deutschland under its licence agreement. The Paris Court of Appeal requested a preliminary ruling on whether the provisions of Article 101 of the Treaty on the Functioning of the European Union (“TFEU”) preclude the imposition of an obligation to pay a royalty for the use of a patented technology for the entire duration of a licence agreement, in the event that the patents protecting the technology are revoked.  The ECJ concluded that Article 101(1) TFEU does not preclude the imposition of a requirement to pay royalties, provided that the licensee is free to terminate the agreement by giving reasonable notice.
Continue Reading Court of Justice Rules That Genentech Must Pay Royalties to Sanofi

Raj Gathani, a Trainee Solicitor in Covington’s London office, contributed to this post.

On 1 September 2015 the General Court issued an interim order in favour of Pari Pharma GmbH (“Pari”) to suspend the European Medicines Agency’s (“EMA”) decision to grant a third-party, Novartis Europharm Ltd (“Novartis”), access to certain documents prepared during the Marketing Authorisation (“MA”) application process (the “MA Documents”).  The MA Documents at issue included EMA Assessment Reports on similarity and superiority between Pari’s product (Vantobra) and Novartis’ product (TOBI Podhaler), which has an EU MA as an orphan medicine.  Novartis made the request to the EMA for access to the MA Documents under the Transparency Regulation 1049/2001.  The main case is currently pending before the General Court (Case T-235/15).

The thrust of Pari’s argument before the General Court was that the MA Documents contain Pari’s regulatory strategy for obtaining MA approval, disclosure of which might cause Pari serious and irreparable financial damage.  The President of the General Court acknowledged that the case raised complex issues in the area of confidentiality and stated that the main proceedings (rather than an interim hearing) is the appropriate forum to address such issues..  As such the President considered that the MA Documents fell under a presumption of confidentiality  and ordered the EMA not to disclose the MA Documents.
Continue Reading General Court Makes Interim Order to Protect Confidentiality in Pari Pharma Transparency Case

The European Commission published its Fifth Monitoring Report of Patent Settlements today. Patent settlements enable patent-related disputes to be resolved without having to litigate issues such as patent validity or patent infringement.  The Commission takes the view that patent settlements can infringe competition law when they prompt generic suppliers to delay entry in return for

The Confidential Disclosure Agreement (“CDA”) is widely used in the Life Sciences Sector, and provides protection for a key asset – a party’s confidential information and trade secrets.  This post does not propose to go through the various possible provisions of a CDA or their negotiation, but instead sets out five practical considerations to take into account when preparing and implementing a CDA.

1. Absolute protection?

Each CDA will provide for certain legal remedies in the event that the other party breaches the agreement, however once an important piece of confidential information is made publicly available it can be difficult or impossible for a party to obtain adequate compensation.  It is stating the obvious to note that the best way to keep confidential information confidential is not to disclose it, however this is sometimes forgotten where a CDA is in place.  On a case by case basis, it is important to consider, prior to disclosure, whether a particular piece of information really needs to be disclosed for a given commercial deal.
Continue Reading The CDA – Five Practical Considerations

Hannah Edmonds, a trainee associate in Covington’s London office, contributed to this post.

Currently, legal  regimes governing protection of trade secrets and confidential information across the EU are fairly disparate. A study published by the European Commission in July (http://ec.europa.eu/internal_market/iprenforcement/docs/20130711/final-study_en.pdf)  has identified a ‘widespread appetite for a harmonized approach’ across the region. Harmonisation of the rules could be of significant financial and practical benefit to life sciences companies.

Ensuring that sensitive information (such as customer supply lists, R & D data and process know how and technology) is legally protected from misuse by employees, consultants, competitors and other third parties is a key concern in the life sciences sector. ‘Trade secrets’ often form the bedrock of a company’s assets. 75% of the 537 EU firms who responded to the Commission’s preparatory survey (some of which were SMEs in the life science sector) indicated that trade secrets were of significant strategic importance to their company’s growth, competitiveness and innovative performance.
Continue Reading A Move to Harmonise Trade Secret Laws Across Europe?

The consultation period for the draft proposed Rules of Procedure of the Unified Patents Court (“Rules”) closes on 1 October 2013.  Any life science business with European operations will, sooner or later, find itself before the Unified Patents Court once it becomes operational, either as a claimant or defendant.  The consequences of that litigation will be significant because the decision will affect the whole of Europe, rather than being confined to a single country as under the current litigation model.  The impact of the Rules will therefore be far-reaching, particularly for the life sciences industry, relying as it does on a relatively small number of patents to protect its key products. Now is your last chance to influence the system!

As explained here, in December 2012 the European Parliament voted in favour of the Unitary EU Patent.  The European Commission anticipated that the first Unitary EU Patent would be granted in 2014, although this time line now appears to be delayed.
Continue Reading Time Is Running Out for Commenting on the Unified Patent Court Rules

Taking a licence from a university or other academic institution raises specific considerations in addition to those that would normally apply in a purely commercial setting.  We set out below ten key considerations for any commercial entity taking a licence from a university in the EU.

1. Continuing academic research in the field and publication rights

Commonly a university will wish to continue to carry-out research in the field within the scope of the licence for academic purposes leading to a risk of intellectual property/confidential information leakage.  Where the university is a charity, it will often have an obligation to publish results in the public interest.


Continue Reading Ten Considerations When Taking a Licence From a University

Overview

A one-way jurisdiction clause (also known as “hybrid”, “asymmetrical” or “unilateral non-exclusive” jurisdiction clauses), requires that one of the parties to a contract must always submit a dispute arising from the contract to a particular country’s courts, whilst allowing the other party the flexibility to commence proceedings in the courts of any country it may choose.

One-way jurisdiction clauses are becoming more prevalent in Life Science transactions where, by way of example, licensors want the flexibility to deal with patent related disputes in the courts of the country where the patent is applied for or granted.

Recent court decisions in a number of jurisdictions have questioned the validity of one-way jurisdiction clauses.

To maximise the likelihood of a one-way jurisdiction clause being enforceable, consider taking the following steps:

  • choose as governing law the laws of a jurisdiction that recognises the validity of one-way jurisdiction clauses;
  • include in the one-way jurisdiction clause an explanation of why the unilateral right to bring proceedings in a second jurisdiction is required – many of the recent decisions on the validity of one-way jurisdiction clauses focus on the lack of fairness to one party; if there is an objective reason for making the jurisdiction clause it may give better arguments to defeat this “unfairness” defence;
  • if you know at the outset that disputes are likely to arise in certain jurisdictions, take local law advice on the enforceability of one-way jurisdiction clauses in these jurisdictions before executing the contract;
  • consider presenting a one-way jurisdiction clause as a non-exclusive jurisdiction clause.
    Continue Reading The Perils of One-Way Jurisdiction Clauses

The implementation of a free trade deal concluded with Korea – the EU’s tenth-largest trading partner – is well on the way, notes the European Commission.  In 2009, Korea became the first Asian country to sign a free trade agreement (FTA) with the EU eliminating tariffs and non-tariff barriers in almost all products, including pharmaceuticals.  The FTA has been in force since July 2011.

The EU is a net exporter of pharmaceuticals to Korea.  The European Commission’s trade statistics show that in 2012 the EU’s pharma exports to Korea reached € 1,530 million whereas  imports from Korea totaled € 124 million.  In 2009, prior to conclusion of the FTA, the EU’s pharma exports to Korea totaled € 1,007 million and imports from Korea € 71 million.  A Korean source observes that in the first 15 months after the FTA came into force, the EU’s top medical export to Korea was ‘drugs for retail sale’ while its most imported medical product from Korea was ‘ultrasound diagnostic devices’. (Source: KHIDI Brief Vol. 49 as published on November 19, 2012.)

In addition to tariffs, the EU-Korea FTA addresses a number of non-tariff issues impacting pharmaceuticals, notably intellectual property (IP) protection.  The FTA includes a comprehensive chapter on this subject with important provisions on patent protection, as discussed below.  Some of these provisions in fact reflect existing laws, while others represent new developments.

Continue Reading Drug Patent Protection in Korea under the EU-Korea Free Trade Agreement