The Court of Justice of the EU has ruled in favour of pharmaceutical companies in four cases that centred on parallel imports, outcomes which practitioners said would protect patients from unfamiliar packaging.
On Thursday, November 17, the CJEU found that a trademark owner of a reference or generic product may oppose a parallel importer’s attempt to market a generic if the packaging has been significantly altered.
The judgments, three of which involved Swiss company Novartis and the other German outfit Bayer, centred on whether the EU’s Falsified Medicines Directive (FMD) permitted parallel importers to completely repackage medicines.
The FMD, introduced in 2011, was designed to harmonise measures to ensure that medicines are safe and that trade is controlled.
Measures included obligatory safety features, such as a unique identifier and an anti-tampering device on the outer packaging, and tougher rules on import of active pharmaceutical ingredients.
But David Lossignol, global head, legal brand protection, at Novartis in Switzerland, said some parties have tried to use the FMD as an excuse to significantly alter a product’s packaging.
He added that these were landmark decisions that clarified the impact the FMD has had on parallel trade and that they would protect consumers from unfamiliar packaging.
The CJEU’s determinations came after referrals from national courts in Belgium, Denmark and Germany.
Two of the cases involving Novartis were against Paranova Danmark(C‑224/20) and Belgium-based Impexeco and Pi Pharma (C‑253/20 and C‑254/20) in a joined matter. They were referred to the CJEU by the Maritime and Commercial Court, Denmark and the Court of Appeal, Brussels respectively.
The other Novartis case, against Abacus Medicine (C‑147/20), was a referral from the Regional Court of Hamburg. The Bayer dispute, against Kolpharma, was also referred from the Hamburg court.
In each case the judgments centred on the extent to which a parallel imported medicine could be repackaged.
In the Novartis v Abacus case, for example, Germany-based Abacus claimed that in order to sell Novartis’s Votrient medicine in packaging suitable for distribution in Germany, it would need to open the original packaging, including the anti-tampering device affixed to it, and repackage it.
Abacus claimed it would be impossible to affix a new anti-tampering device on the original packaging without leaving visible traces of its opening. Novartis disputed this argument.
In each case, the CJEU found that the owner of a trademark for a reference product or the owner of a trademark for a generic can oppose a parallel import “where that product has been repackaged in new outer packaging to which the trademark of the reference medicinal product has been affixed”.
Lossignol said that following these judgments, the FMD “will no longer be able to be used as a justification to systematically repackage parallel imported medicines”.
Pharma relief
Frank Meixner, head of trademarks at Bayer in Düsseldorf, said the decision involving his company brings a highly welcome clarification of the rules for parallel imports of pharma products.
Over the decades a highly complex case law had developed in this area, he explained – the importer had to choose the least invasive method of repackaging when adapting the imported product to meet the regulatory requirements in the country of destination.
“In this context, relabelling was the norm and completely replacing the original packaging was only admissible in exceptional cases.”
However, he noted that importers argued that the FMD was a game changer.
“A considerable number of parallel importers used the directive as an opportunity to challenge the established regime and argue that the FMD was a game changer with the new safety features making relabelling in principle impossible because it was allegedly not as safe.”
He added: “We are very pleased that in the end the CJEU has confirmed that the established set of rules for parallel imports still applies despite the FMD and that relabelling of imported products in this context is as safe as reboxing.”
The judgments also clarified that generic medicines cannot be removed from EU countries where there may be patients in need and rebranded to be sold as an original brand at a higher cost in another EU country.
Lossignol added that this determination was of particular importance in the context of Novartis’s decision to separate its generics company Sandoz from the main business. That decision was announced in August this year.
He said that had the CJEU not reached its conclusions, it could have affected how Sandoz and Novartis operated for products sold by both companies but under different brands in different countries.
He added: “Ultimately the decision is logical as it would be improper for a company like Novartis to be penalised for trying to improve access to additional patients in some EU countries through Sandoz-branded products and for the products to be authorised to be removed from the targeted patients in need, be rebranded into a Novartis brand, and be sold in other EU countries.”
Novartis was represented by Ulf Grundmann and Elisabeth Kohoutek, partner and counsel respectively in the Frankfurt office of King & Spalding. Bayer was represented by Ulrich Reese (partner) and Caroline Giesen (senior associate) in the Düsseldorf office of Clifford Chance.
