3 December 2018

CJEU clarifies the scope of the ‘Specific Mechanisms’ in case C-681/16 Pfizer v Orifarm

Since 2004, 13 additional Member States have joined the European Union. As part of the expansion of its membership, the EU has had to deal with the situation where new Member States may not have offered the same level of patent or Supplementary Protection Certificate (SPC) protection for pharmaceutical products prior to their joining.

When coupled with the EU’s principle of the free movement of goods, this could hypothetically have exposed a patent holder to parallel imports from new Member States without them having been able to protect their product in those States and, consequently, without having received adequate compensation for their invention. To prevent this scenario, an exception to the free movements of goods was provided as part of the Acts of Accession through which the new Member States joined the EU and is known as the ‘Specific Mechanisms’.

Under the Specific Mechanisms the holder of a patent or SPC for a pharmaceutical product filed in an existing Member State at a time when such protection could not be obtained in the new Member State for that product, may rely on the patent or SPC in order to prevent the import and marketing of that product in that existing Member State, even if the product was put on the market in that new Member State for the first time by him or with his consent.

As it represents an exception to the principle of free movement of goods within the EU, the Specific Mechanisms need to be interpreted narrowly.

In the recently decided case of Pfizer v Orifarm (C-681/16), Pfizer sought to prevent the importation of the arthritis drug Etanercept into Germany from several new Member States by the Danish group Orifarm, operating as a parallel importer of pharmaceutical products. The protection for the drug derived from an SPC based on a German patent with a filing date of 31 August 1990. At the time of filing the patent application it was impossible to obtain equivalent patent protection for the product in the new Member States but at the time of filing the application for an SPC (26 June 2003) it was possible to obtain SPC protection in all the new Member States except Croatia. However, the existence of a granted patent is a necessary condition for the subsequent grant of an SPC and consequently it was still impossible for the patent holder to obtain equivalent SPC protection in the new Member States.

The Landgericht Düsseldorf (Regional Court, Düsseldorf) court referred several questions to the CJEU to determine the date in respect of which the level of protection in the new and existing Member States should be compared for the purpose of applying the Specific Mechanisms. In line with the opinion of the Advocate General, the CJEU decided that:

“the Specific Mechanisms must be interpreted as authorising the holder of an SPC issued in a Member State other than the new Member States to oppose the parallel importation of a medicinal product from the new Member States in a situation where the legal systems of those States provided for the possibility of obtaining equivalent protection at the time when the application for the basic patent was published and/or the application for an SPC in the importing Member State was filed, but did not yet provide for such a possibility at the time when the application for a basic patent was filed, with the result that it was impossible for the patent holder to obtain an equivalent patent and SPC in the exporting States.”

The court was also asked to decide whether the Specific Mechanisms should be interpreted as applying to paediatric extensions even though such an extension is not expressly provided for. In this respect the court decided that the Specific Mechanisms should be interpreted as applying to paediatric extensions.

This ruling clarifies the scope of the Specific Mechanisms and maintains the balance between the principle of free movement of goods within the EU and the rights of the patent holder which the Specific Mechanisms sought to achieve.