Budapest Court Grants Preliminary Injunction Based on Direct Threat of Patent Infringement Preventing Pharmaceutical Product Launch

The Metropolitan Court, Budapest has recently issued an order granting preliminary injunction against a Hungarian pharmaceutical distributor. The specialty of the case is that the allegedly infringing pharmaceutical product was not yet launched and it is the first time in judicial practice that the court still found that there is a threat of imminent infringement.

There have been numerous attempts in the pharmaceutical litigation in the past years to obtain a preliminary injunction against a presumably infringing pharmaceutical product at a stage when it was not yet on the market. Throughout the years the Metropolitan Court, which has exclusive competence to patent infringement proceedings, has responded to these attempts rather restrictively. Years ago it made clear that the mere act of obtaining a marketing authorization is neither an act of infringement nor the threat thereof. The next step – application for reimbursement – was also ruled out as not being sufficiently closely linked to the start of actual – unauthorized – patent exploitation activities.

In its most recent decision the Metropolitan Court granted the injunction pre-launch. However, in this case the facts carried an additional element. The defendant was granted reimbursement  and in addition made a rather vague admission during the PI proceeding that it intended to start activities necessary for the launch of the product at a given (close) date. The court stated that it could not attribute any other meaning to this statement than the admission of the intention to start importing and storing the product and thus obliged the defendant to refrain from distribution, importation, storing of the product until the expiry of the patent.

Also the court found that the fact that the infringing product has appeared in pharmaceutical prescription software that doctors and pharmacists use, qualifies as promotion of the product which is also directly linked to exploitation activities and is directly threatening with infringement. In connection with this the court referred to C-179/15 Daimler, a case referred to the CJEU by the same court, pointing out that as long as the defendant does not try to prevent its product from appearing in those prescription programs this type of promotion is to be considered as having been done by the defendant and not by third parties.  For this reason the court obliged the defendant to remove its product from the prescription software.

The decision illustrates that while the mere obtaining of necessary regulatory approvals for the launch of a pharmaceutical product may not be sufficient for the institution of a preliminary injunction, in combination with other specific circumstances the entirety of the facts can still be deemed as directly threatening with patent infringement and can be basis for obtaining an injunction even before the infringing product appears on the market.

There were other important notions made by the court in this decision, e.g. it was once again underlined that if the subject of the proceeding is a national patent, the necessity of the preliminary injunction cannot be undermined by the validity decisions re parallel patents by the EPO or a foreign court. The court even said that the pending (not yet reached first instance decision) national revocation action is not more than the usual uncertainty factor coming along with this type of cases, which does not justify the refusal of the PI but only the ordering of a security bond as precondition.

The decision is subject to appeal.

Reported by Eszter Szakács, Sár and Partners