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Novartis Pharmaceuticals UK Limited, Novartis Pharma AG & Novartis International Pharmaceutical AG v Dr. Reddy’s Laboratories (UK) Limited, UK Patents Court, 15 January 2019, [2018] EWHC 92 (Pat)

In a recent case before the UK Patents Court, in addition to considering an application for summary judgment to revoke the patent in suit for added matter, Mr Justice Birss determined the first application for an interim injunction based on a second medical use claim, since the Supreme Court’s decision in Warner Lambert v Generics (UK) (the pregabalin/ Lyrica litigation). Notably, Dr. Reddy’s had admitted infringement (save that it claimed the patent was invalid) and its product was authorised under a full label.

The patent in suit, EP 2 269 603, claims, in EPC 2000 format, the combination of everolimus (a derivative of rapamycin) in combination with exemestane (an inhibitor of aromatase) for use in the treatment of hormone receptor positive breast cancer (the “breast cancer indication”). The Patentees are members of the Novartis group (“Novartis”). The defendant, Dr. Reddy’s Laboratories (UK) Limited (“Dr. Reddy’s”), obtained a marketing authorisation for everolimus in the summer of 2018 but this did not have a “skinny” label, it included use of the combination for the patent protected use. The SPC for the basic everolimus product patent expired on 17 January 2019.

As noted above, Dr. Reddy’s had admitted infringement of the patent, but subject to the patent in suit being invalid. The sole validity attack mounted against the patent was based on added matter, the plea being that the combination and its use as claimed in claim 1 had not been disclosed in the application as filed. In essence, Dr. Reddy’s case was that the patent was invalid for the reasons given by the opposition division of the EPO, which had revoked the patent in June 2018 solely on the basis of added matter.

Novartis brought an application for an interim injunction and Dr. Reddy’s responded with an application for summary judgment on its counterclaim for revocation. The Judge indicated that he had formed a provisional opinion on the papers that there was no added matter; and after hearing submissions from counsel for Dr. Reddy’s he decided (without hearing counsel for the patentee) that there was no arguable case that the patent was invalid on the ground pleaded and on the material available to the Court.

In doing so, he refused to apply the EPO Guidelines on “Selection from two lists and deletion of elements from two lists”, noting that “there is a danger of taking a rather too rigid approach if one looks at it in that way”. He instead focussed on the application of the legal test, as is common practice in the UK. The Judge considered whether he should dismiss the counterclaim entirely and give judgment on the claim but was persuaded not to do so as Novartis had not sought summary judgment on the validity of the claims.

Turning to Novartis’ application for an interim injunction, Birss J found that the commercial evidence before him demonstrated a real risk of unquantifiable loss to both sides if the injunction was granted or if it were refused. On the one hand, Novartis risked losses from “irrecoverable price depression” while, on the other, Dr. Reddy’s stood to lose its “first mover advantage” by delaying the launch of its product. Presented with the usual factual evidence covering the familiar ground often seen in pharmaceutical patent cases, the Judge spent little time in concluding that the right thing to do was to grant the interim injunction.

Dr. Reddy’s submitted that the terms of the order should contain several carve-outs from the form proposed by Novartis. The first of the proposed carve-outs mirrored section 60(2) of the Patents Act; allowing Dr. Reddy’s to sell if it was not obvious the product would be used for the breast cancer indication. In coming to his decision not to accept the first carve-out the Judge took into account that Dr. Reddy’s held a full-label marketing authorization, including the breast cancer indication, (rather than a skinny label) and that the breast cancer indication made up 90% of the UK sales of Everolimus. Dr. Reddy’s offered to write a cover letter to accompany its contracts for sale stating that the sale was on the basis that the product should not be used for the breast cancer indication. The Judge rejected that proposal and suggested that a contractual term specifically prohibiting use for the breast cancer indication be included in Dr Reddy’s contracts for sale. Dr. Reddy’s responded that there was no scope to add such a clause into such contracts.

The second carve-out proposed was in relation to supply of product for clinical trials based on the terms of section 60(5)(i) of the Patents Act. As the Judge noted, it was a point which was not pleaded. Although the Judge declined to include the carve-out requested he was prepared to give Dr. Reddy’s liberty to apply if it wished in future to supply the product in such circumstances.

Dr. Reddy’s final point was whether the cross-undertaking should also cover the Department of Health (“DH”) and other relevant National Health Service (“NHS”) entities. None of these third parties were in court let alone parties to the proceedings so, following the approach he took in Actavis v. Boehringer in similar circumstances, the Judge gave the DH and relevant NHS entities liberty to apply to be added to the cross-undertaking. The Judge himself undertook to write to those third parties to inform them of his decision. Accordingly, the order was made substantially in the standard form requested by Novartis.

A copy of the decision can be read here.

Headnote: Simon Spink, Bristows LLP