T-44/16, Novartis v EUIPO and SK Chemicals GmbH, General Court, 31st January 2018

Chris Morris describes why big pharma can face unique hurdles against generic competition

Key points

  • While product shapes remain protectable in principle, Article 7(1)(e) EUTMR continues to present a high hurdle for applicants and a powerful ground for invalidity
  • The case applied the law applicable before the recent revisions to the EUTMR. It remains to be seen whether the revised Article 7(1)(e) wording will see these exclusions applied more broadly

This case illustrates the particular difficulties applicants face when seeking to protect signs that are complete representations of a product. The decision turned on the specific exclusions laid down in Article 7(1)(e) of the Trade Mark Regulation (EUTMR), and is also an example of the problems pharmaceutical companies face in seeking to use trade mark law to maintain a competitive advantage against manufacturers of generic products.

Background

The Applicant, Novartis, applied to register a mark in class 5 (pharmaceutical preparations for the treatment of dementia of the Alzheimer's type). Registration was obtained in March 2013. The mark is a representation of a product called Exolon, used to treat Alzheimer's and administered by transdermal patch. The product was protected by patent until July 2012.

The Intervener, SK Chemicals GmbH, is a generics manufacturer and produced a transdermal patch to administer the same active substance (rivastigmine) as Exolon. SK applied to invalidate the Novartis registration.

The Cancellation Division and, on appeal by Novartis, the Fifth Board of Appeal (BoA) upheld the invalidity application. EUIPO found that the mark was invalid because it was composed of a sign consisting exclusively of the shape of the product necessary to obtain a technical result (Article 7(1)(e)(ii)).

The BoA defined the essential characteristics of the mark as: (i) the square shape of the patch; (ii) the overlapping protective plastic layer, represented by the white stripe in the background of the mark; (iii) the circular area in the centre; and (iv) the arrangement of knobs around the central circular area. Each of those elements is functional; the beige colour is not an essential characteristic.

CJEU appeal

Novartis's appeal to the CJEU was also dismissed. The Court disagreed with the argument that, because each of the essential characteristics identified served a different technical function, the sign was not objectionable. It sufficed that each served any technical function, provided they all combined to obtain the technical result.

The BoA was also right, the Court found, to find that where each essential characteristic fulfils a technical function, there is no requirement to carry out an overall assessment. The combination cannot render the mark registrable.

Novartis argued that, where other shapes are available, a given shape is no longer "necessary" to obtain a technical result – but this was swiftly dismissed. The Court also did not agree with the claim that an incorrect analysis of the essential characteristics was applied. The detailed examination was correct. The Office is entitled to look at, for example, product-specific information, not just the representation of the mark.

Finally, the claim by Novartis that the beige colour was an essential characteristic was dismissed. The presence of a minor, arbitrary element is irrelevant.

Considerations

As well as serving as a reminder of the higher hurdles faced in practice by shape marks, this case reaffirms one of the policy considerations behind the statutory shape exclusions. The term of patent protection afforded to the Exolon product had ended, and generics manufacturers were free to produce rival products. Novartis was not able to extend that protection by obtaining trade mark protection (a potentially open-ended right) for the means of drug delivery.

Originally published in CITMA Review

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