Analysing the rules of proof in China’s first drug patent linkage suit
Wu Xiaohui of Wanhuida Intellectual Property explains a pioneering case heard by the Intellectual Property Court of the Supreme People’s Court and considers its implications for original and generic drug makers
On March 30 2023, the Intellectual Property Court of the Supreme People’s Court (SPCIPC) released its Exemplary Cases in 2022. The 20 exemplary cases were selected from a total of 3,468 technology-related intellectual property and monopoly cases the court concluded in the year. Among the 20 cases, Chugai v Haihe is the nation’s first drug patent linkage litigation.
First introduced in China’s Patent Law in 2020, the drug patent linkage regime is designed to resolve drug patent disputes at an early stage. The regime, which has been up and running in China for a little shy of two years, is in its infancy. The application of various rules still needs clarification in judicial practice.
The case was chosen by the SPCIPC for its exploratory application of law in solving novel matters that emerged in the early stage of the regime.
Background and development of the case
The Eldecalcitol Soft Capsule is a drug developed by Japanese drug maker Chugai Pharmaceutical (Chugai) to treat osteoporosis. Chugai owns patent No. 200580009877.6, titled ‘ED-71 Preparation’ (the patent at issue), and has registered the aforesaid drug and patent on the Chinese Marketed Drug Patent Information Registration Platform.
Wenzhou Haihe Pharmaceutical (Haihe) applied to the National Medical Products Administration (NMPA) for the marketing approval of a generic version of the aforementioned original drug and made a statement asserting that its generic drug does not fall within the protection scope of a relevant patent.
Chugai filed a lawsuit with the Beijing Intellectual Property Court (BIPC) asserting that the technical solution of Haihe’s generic falls within the protection scope of the patent at issue. On April 15 2022, the BIPC rendered a decision finding that the technical solution of the generic was neither identical nor equivalent to the technical solutions of claims 1–6 of the patent at issue. The BIPC thus concluded that the generic did not fall within the protection scope of the patent at issue and dismissed the claims of Chugai.
Chugai filed an appeal before the SPCIPC, which upheld the first-instance decision on August 5 2022.
Analysis of the decision
One of the focuses of this case is the specific type of antioxidant excipients used in the generic drug application. Chugai asserted that the medicinal excipient actually used in the formulation of the generic drug, of which Haihe applied for registration, is dl-α-tocopherol, as claimed in the patent at issue. Haihe intentionally replaced dl-α-tocopherol in its drug registration application to evade infringement.
The SPCIPC held that for chemical generic drugs, the NMPA will conduct its drug marketing review and approval process on the basis of the application materials submitted by the generic drug applicant and shall decide within the specified period whether to suspend the marketing approval of the said drug, based on a legally effective court decision settling such disputes.
In principle, comparison shall be made between the application material filed by the generic drug applicant and the claims of the patent at issue to determine whether the technical solution of the former falls within the protection scope of the latter. The applicant shall be held liable in the event of any discrepancy between the technical solution actually implemented by the generic drug applicant and that cited in the application material.
The patentee or stakeholder may initiate a standalone patent infringement suit should they believe that the technical solution actually implemented by the generic drug applicant constitutes infringement.
Therefore, the SPCIPC affirmed that as far as a drug patent linkage suit is concerned, it is not within the court’s remit to ascertain whether the technical solution actually implemented by the generic drug applicant is identical to that filed in the application material.
The SPCIPC also dismissed Chugai’s evidence retrieval requests, based on the reasoning that the technical solution of the generic drug should be based on the application material, rather than the technical solution actually implemented by the generic drug applicant. The court concluded that the evidence is sufficient to prove the antioxidant excipient used in the generic drug and there is no need to retrieve other information from the NMPA application.
The significance of the case
A drug patent linkage suit addresses the issue surrounding whether the technical solution of a generic drug falls within the protection scope of the patent at issue. It is fundamentally different from a traditional patent infringement suit which addresses whether the actual production, use and other acts are infringing.
Article 3.2 of the Provisions on Several Issues concerning the Application of Law in the Trial of Civil Cases involving Patent Disputes Related to Drugs Applied for Registration prescribes that the applicant for drug marketing approval shall submit to the people’s court, within the period for filing a defence in the first instance, duplicates of necessary technical materials relevant to the determination of whether the generic drug falls within the protection scope of relevant patents that have been filed before the NMPA. It means that:
Generic drug applicants are obligated to file the technical solution of the generic drugs and there will be consequences in the event of non-compliance; and
Generic drug applicants bear limited burden of proof.
Where the original drug maker (the patentee) has doubts over the assertions of the generic drug applicant and believes that the materials filed fail to reflect the actual technical solution of the generic, the patentee needs to provide counter-evidence to corroborate reasonable doubt; otherwise, it shall bear adverse consequences.
Patent linkage litigation is closely intertwined with the generic drug marketing approval process. In practice, it could be quite challenging for original and generic drug makers with regard to the selection of convincing evidence in the marketing approval process. This case is of guiding significance in terms of analysing the rules of proof in similar cases.