Learning from Case Law: Mylan vs Gilead (case C-473/22) on potential Supplementary Protection Certificate (SPC) infringement

This post is an attempt to present some of the salient information from Case C-473/22 concerning Mylan vs Gilead on potential Supplementary Protection Certificate (SPC) infringement.

The information provided below is by no means exhaustive. In order to develop a thorough understanding of the case, it is important to read the judgement in full as as well as the various and diverse viewpoints on the case provided by law firms (links are provided in the References and Further Information sections).

Parties to the main proceedings

Mylan AB

Gilead Sciences Finland Oy, Gilead Biopharmaceutics Ireland UC, and Gilead Sciences Inc.

Background to the case¹

This case originates from the Market Court of Finland where Mylan applied to the court² for an order asking Gilead to pay it approximately 2.3 million Euros as damages for losses caused by a Preliminary Injunction (PI) sought by Gilead against it (Mylan), based on a supplementary protection certificate that was subsequently found invalid.³

Mylan argued that the PI had been sought unnecessarily which would expose Gilead to strict liability under well-established Finnish case law⁴. This provides that a person who obtains a PI is strictly liable for compensation if the IP right on which the PI was granted is subsequently found invalid.

Gilead argued that such a liability regime was contrary to Directive 2004/48/EC on the enforcement of intellectual property rights, following the CJEU’s earlier ruling in Bayer Pharma (C‑688/17, 12 September 2019). The CJEU ruled in this case that the mere fact of repealing the PI should not allow national courts to automatically and in any event order the PI applicant to compensate the defendant for any loss suffered.

References

1. Strict liability in preliminary injunction proceedings: Advocate General opinion by Henri Kaikkonen, Partner, Bird And Bird, 23 November 2023

2. Point No 20 in Table 1 below

3. Point no 19 in Table 1

4. Point No 22 in Table 1

Judgement of the case

You can read the full Judgment of the Court (Third Chamber) of 11 January 2024, here.

The CJEU ruled that:

Article 9(7) of Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights must be interpreted as not precluding national legislation which provides for a mechanism for compensation for any injury caused by a provisional measure, within the meaning of that provision, based on a system of strict liability of the applicant for those measures, in the context of which the court is entitled to adjust the amount of damages by taking into account the circumstances of the case, including whether the defendant played a part in the occurrence of the injury.

Table 1: Points as detailed in the judgement

Point no	Date	Event
13	3 Dec 2009	The Patent and Registration Office, Finland granted Gilead and Others, on the basis of European Patent No EP 0 915 894, designating the Republic of Finland, supplementary protection certificate No 266 ‘Tenofovir disoproxil (TD) and the salts, hydrates, tautomers and solvates thereof, in combination with emtricitabine’ (‘the SPC at issue’) for an antiretroviral medicine indicated for the treatment of people with HIV
14	Spring of 2017	Mylan tendered for public contracts organized by two Finnish health districts with a view to supplying its generic medicine “EMTRICITABINE/TENOFOVIR DISOPROXIL MYLAN 200 mg/245 mg, film-coated tablet” (hereinafter “the generic drug in question”). The company won both tenders.
15	25 July 2017	European patent No EP 0 915 894 expired.
16	15 Sep 2017	Gilead and Others brought an action before the Market Court, Finland for infringement of the SPC at issue. Gilead also filed an application for provisional measures against Mylan. Mylan opposed the infringement action and the application for provisional measures.
16	30 Nov 2017	Mylan brought an action before the Market Court, Finland, seeking a declaration of invalidity of the SPC at issue.
17	21 Dec 2017	By a decision on this date: i) the Market Court, Finland upheld Gilead and Others’ application for provisional measures on the basis of the SPC at issue and prohibited Mylan, on pain of a fine of EUR 500 000, from offering, placing on the market and using the generic medicine at issue during the period of validity of the SPC at issue, and from importing, manufacturing and possessing the generic medicine at issue for those purposes. ii) It further ordered that those measures were to remain in force until a decision was delivered in the main proceedings or until further notice.
18	11 April 2019	The aforementioned interim measures (see above 21 Dec 2017) were subsequently annulled, at the request of Mylan, by decision of the Supreme Court, Finland.
19	25 Sep 2019	By judgment on this date, the Market Court, Finland found the SPC at issue to be invalid. An appeal against that judgment was lodged before the Supreme Court, which, by order of 13 November 2020, refused Gilead and Others’ request for leave to appeal, with the result that that judgment became final.
20	Mylan applies for compensation	Under Paragraph 11 of Chapter 7 of the Code of Judicial Procedure, transposing Article 9(7) of Directive 2004/48 into Finnish law, Mylan then applied to the Market Court, the referring court in the present case, for an order that Gilead and Others pay it compensation in the amount of EUR 2 367 854.99, plus default interest, as compensation for the injury caused by the provisional measures unnecessarily obtained on the basis of the SPC at issue, which was subsequently found to be invalid.
21		According to Mylan, the Court’s interpretation of Article 9(7) of Directive 2004/48/EC in the judgment of 12 September 2019, Bayer Pharma (C‑688/17, EU:C:2019:722; ‘the judgment in Bayer Pharma’), does not support a finding that that directive precludes the application of the principle of strict liability, provided for by Finnish law
22 – 24	Strict liability defined according to Finnish Case law.	The referring court recalls that, according to Finnish case-law and academic writing, Paragraph 11 of Chapter 7 of the Code of Judicial Procedure provides for liability without fault, that is to say strict liability. It follows that a person who obtains a provisional measure is liable to pay compensation if the intellectual property right on the basis of which the provisional measure was granted is subsequently found to be invalid. That being so, the referring court notes that, according to settled Finnish case-law, including in the cases referred to in that provision, the amount of compensation may be reduced on the ground that the defendant himself or herself enabled the injury to occur or failed to take reasonable measures to avoid or mitigate the injury and thereby contributed to its occurrence. In addition, the referring court points out that the principle of strict liability, as it appears in the Finnish legal system, is also taken into account when granting a provisional measure. According to that court, in order for such a measure to be granted, it is necessary to assess the likelihood of the intellectual property right on which that measure is based being declared invalid following a possible action seeking a declaration of invalidity. As regards the respective losses incurred, the loss caused to the subject of the order for the provisional measure, on the one hand, should be weighed against the loss that would be caused to the applicant if it were not granted.
25 – 26	The referring Finnish court asks whether a compensation regime based on strict liability, such as that … in force in Finland is to be regarded as compatible with Article 9(7) of [Directive 2004/48]	However, in the light of the interpretation adopted by the Court in the judgment in Bayer Pharma, the referring court asks whether a system of compensation based on strict liability may be regarded as compatible with Article 9(7) of Directive 2004/48/EC. In that context the Market Court, Finland decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling: ‘(1) Is a compensation regime based on strict liability, such as that … in force in Finland, to be regarded as compatible with Article 9(7) of [Directive 2004/48]? (2) If the first question is answered in the negative, what then is the nature of the liability for compensation on which the liability under Article 9(7) of [Directive 2004/48] is based? Is that liability to be regarded as a form of liability based on fault, an abuse of rights, or some other ground? (3) In relation to the second question, what circumstances must be taken into account in assessing the existence of liability? (4 In particular, as regards the third question, must the assessment be made solely on the basis of the circumstances known at the time when the provisional measure was obtained, or is it permissible to take into account, for example, the fact that the intellectual property right on whose alleged infringement the provisional measure was based was subsequently, after that measure was obtained, found to be invalid ab initio and, if so, what significance is to be attached to that circumstance?’ By its first question, the referring court asks, in essence, whether Article 9(7) of Directive 2004/48 must be interpreted as precluding national legislation which provides for a mechanism for compensation for any injury caused by a provisional measure, within the meaning of that provision, based on a system of strict liability of the applicant for those measures, in the context of which the court is, however, entitled to adjust the amount of damages by taking into account the circumstances of the case, including whether the defendant played a part in the occurrence of the injury.
	21 Sept 2023	Advocate General Spunar delivered an opinion on the case
27	11 Jan 2024 Judgement of the court	Court (Third Chamber) hereby rules: Article 9(7) of Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights must be interpreted as not precluding national legislation which provides for a mechanism for compensation for any injury caused by a provisional measure, within the meaning of that provision, based on a system of strict liability of the applicant for those measures, in the context of which the court is entitled to adjust the amount of damages by taking into account the circumstances of the case, including whether the defendant played a part in the occurrence of the injury.

Parties to the main proceedings

Background to the case1

References

Judgement of the case

Table 1: Points as detailed in the judgement

Further reading

Background to the case¹