Japan: Tokyo District Court Rules On Enforceability Of Patent With Extended Term

In a judgment issued on March 30, 2016, the Tokyo District Court held that a patent that was granted extension of term may be enforced, not only against a product that was the subject of the disposition on which the term extension was based, but also against other products that are equivalent or essentially identical to the product that was the subject of the disposition (Tokyo District Court Case No. 2015 (wa) 12414).

Background

Under the Patent Act of Japan, term of a patent begins upon registration and generally expires 20 years after the filing date. However, the Patent Act also allows for extension of the patent term, if a regulatory approval or other disposition (such as marketing approval for drugs) is required in order to utilize the patented invention, and due to such a requirement, there was a period during which the patent owner was not able to utilize the patented invention. In order to obtain a patent term extension ("PTE"), the patent owner must file an application for a PTE with the Japan Patent Office (the "JPO"), and the JPO may grant extension up to five years.<

Once the PTE is granted, the patent during its extended term may be enforced only against a product that was the subject of the disposition on which the PTE was based (Article 68bis of the Patent Act).

Debiopharm International S.A. ("Debiopharm") owned a Japanese patent (the "Patent") for an invention entitled "Pharmaceutically Stable Oxaliplatinum Preparation." Debiopharm's licencee sought a marketing approval for a new drug "ELPLAT", which contained oxaliplatin (the same compound as oxaliplatinum) as an active ingredient, and the Ministry of Health, Labor and Welfare (the "MHLW") granted the approval. Thereafter, Debiopharm filed an application for a PTE with the JPO based on the approval of ELPLAT, and the JPO granted the extension. As a result, the Patent continued to be in effect after its original expiration date.

Towa Pharmaceutical Co. Ltd. ("Towa") obtained a marketing approval from the MHLW for a generic drug "TOWA," and started selling TOWA in the Japanese market. TOWA had the same active ingredient, effect and efficacy as ELPLAT. However, TOWA included a concentrated glycerin as an additive, which was not included in ELPLAT.

Debiopharm filed a patent infringement action against Towa with the Tokyo District Court, seeking injunction.

Judgment

Although there were several issues involved in the action (such as literal infringement, and invalidity due to lack of novelty and/or inventive step), the Tokyo District Court focused on the issue of whether the Patent may be enforced against TOWA, or in other words, whether TOWA is a product that was the subject of the disposition on which the PTE was based.

The Tokyo District Court held that in order to enforce an extended patent, the defendant's products do not have to be exactly identical to the product that was the subject of the disposition on which the term extension was based; rather, it is sufficient if the defendant's products are equivalent or essentially identical to the product that was the subject of the disposition, such as when there was merely an addition, deletion and/or conversion of a well-known or commonly used art that does not result in a new effect.

The Tokyo District Court further classified drug patents into two categories: (i) patents that claim the active ingredient itself; and (ii) patent that claim the preparation. The Tokyo District Court held that if the plaintiff's patent belongs to the first category, in many cases the patent would cover different products, as long as such products have the same active ingredient and thus is bioequivalent to the product that was the subject of the marketing approval; however, if the patent belongs to the second category, there would be cases where the patent would not cover such other products.

The Tokyo District Court held that the Patent belongs to the second category. Also, the Court found that addition of concentrated glycerin in TOWA resulted in a new effect, namely that the concentrated glycerin will restrict the natural decomposition of oxaliplatin in the drug. Therefore, the Court concluded that TOWA is not a product equivalent or essentially identical to ELPLAT, and thus the Patent may not be enforced against TOWA.

As a conclusion, the Tokyo District Court denied Debipharm's injunction claim.

Comments

Previously, most arguments regarding PTE centered around the issue of under what conditions the PTE shall be granted. The issue of enforceability of an extended patent was less focused on, and although the Intellectual Property High Court indicated in dictum that the extended patent may be enforced against products that are equivalent or essentially identical to the product that was the subject of the marketing approval (IP High Court, Grand Panel judgment dated May 30, 2014), the enforceability was not actually litigated. The Tokyo District Court judgment introduced above is the first decision by a Japanese court to actually decide on the enforceability issue.

Further, the Tokyo District Court classified drug patents into two categories (patents claiming active ingredients, and patents claiming preparation), and indicated that patents that belong to the first category have wider coverage than patents that belong to the second category.

As mentioned above, this Tokyo District Court judgment is the first court decision to actually decide on the issue of enforceability of an extended patent. It is expected that further case law would give more clarification on this issue.

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