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Neurim and Flynn v Mylan [2020] EWCA Civ 793

In an expedited appeal from the UK Patents Court, the Court of Appeal has dismissed Neurim/Flynn’s appeal and refused to award an interim injunction preventing generic pharmaceutical launch pending trial. The hearing took place on Thursday 18 June 2020, two weeks after the appealed decision, by a panel of Lord Justices Floyd, Arnold and Males.

The Patents Court Decision
In the original Patents Court decision, Mr Justice Marcus Smith held that Neurim/Flynn fell at an early point in the American Cyanamid tests and found that the damage caused to the innovator/originator product (Circadin) was quantifiable as damages. As a result, he did not go on to consider the balance of convenience, albeit obiter comments were made in such respects.

The Appeal
The Court of Appeal upheld the decision of the Patents Court, but noted that it was the “extremely unusual facts” of the case that had led to this finding, the leading (and only substantive judgment) by Floyd LJ stated that:

I have not decided any principle of general application. I have explained why I do not think that the extremely unusual facts of this case give rise to such difficult questions of computation of damages as to trigger the exercise of the court’s discretion to grant an injunction.”

What were the “extremely unusual facts”?

In terms of identifying the “extremely unusual facts”, the matters highlighted in this decision include that:

1. There was an expediated trial that meant the relevant length of time the interim injunction would be granted for was only four months. In this respect, the decision emphasised that the evidence of consequential losses presented by Neurim and Flynn had been produced before expedition and so related to longer term effects.

2. Neurim and Flynn were held to have sufficient cash reserves to sustain their revenue until trial, with the Court of Appeal dismissing the suggestion that their consequential losses would result in parts of their operation having to shut down.

3. Mylan were the only “ready to launch” generic company that could compete in this timeframe, with Teva (the only other generic with a UK marketing authorisation) having agreed not to launch in the UK via settlement. The Court of Appeal accepted that further generic launch was a possibility, but found that the evidence fell short of establishing it was likely.

4. Neurim and Flynn had provided detailed forecasting of their predicted revenues, which was held provided basis to quantify their damages, which could be “assessed liberally”. The Court of Appeal went so far as to correct certain findings (relating to the impact of a second generic launch), such that it held that the damages calculation was actually even less complicated and more quantifiable than the Patents Court decision had found.

These factors all contributed to the Court of Appeal’s overall view that the patentee/licensee in this case did not face a ‘price spiral’ situation and that there was unquantifiable damage. As such, the Court of Appeal did not go on to consider at all matters as to the balance of convenience.

The full judgment can be accessed here.

Headnote: Jennifer O’Kane and Amy Crouch, Simmons & Simmons LLP