IP Insight – Secretary of State for Health v Servier and others [2019]

IP Insight - Secretary of State for Health and another v Servier Laboratories Ltd and others [2019] EWCA Civ 1160
IP Insight – Secretary of State for Health and another v Servier Laboratories Ltd and others [2019] EWCA Civ 1160

IP Insight – Secretary of State for Health and another v Servier Laboratories Ltd and others [2019] EWCA Civ 1160

Earlier this week, Virtuoso’s own Liz Ward was asked by LexisPSL to provide case analysis of a recent Court of Appeal decision concerning alleged unlawful interference by a patentee causing significant loss to the NHS.

This edition of IP insight takes a look at the context for these issues, and our analysis for LexisPSL can be found here.

Background

Patents are vital to the pharmaceutical industry. The period of exclusivity when only the company which developed a new drug may manufacture and distribute it allows them to recoup research and development costs. Similarly, Supplementary Protection Certificates extend the lifetime of a patent, reflecting the time investment and clinical trials needed to launch a pharmaceutical product.

Set against this is the need for access to medicines by health services and patients, as soon and as affordably, as possible. When a patent protecting a drug expires, is revoked, or is abandoned by the patent owner (or patentee), generic manufacturers are free to launch cheaper versions of the same drug.

Until then, while the patent is in force, the cost to the NHS and to individuals can be astronomical. The news broke recently of patients and their families resorting to forming their own buyers’ club to import cystic fibrosis drugs from overseas.

Similarly, recent patent litigation has seen the introduction of “skinny labelling”. NHS England was instructed to prescribe a branded drug for pain (a patent-protected indication), though allowed to prescribe generic forms for other conditions. The cost of this to the NHS by the time this case reached the Supreme Court was estimated at half a billion pounds. The Supreme Court concluded that the patent was not valid.

The significance of patent proceedings for the NHS is undeniable.

Secretary of State for Health and another v Servier Laboratories Ltd and others [2019] EWCA Civ 1160

In this case, the Secretary of State of Health argued that Servier had intentionally or recklessly deceived the courts and the European Patent Office (EPO) in applying for and enforcing a patent. This was alleged to constitute the economic tort of interference by unlawful means. The Court of Appeal was not persuaded that the case should proceed because this tort includes interference with the liberty to deal between the claimant and third party (i.e. in this case, between the NHS and either the English courts or the EPO).

For full analysis which considers this case and its practical implications, read the analysis by Liz and Ellie on LexisPSL here.

Our Insight

Although the NHS was not able to establish the unlawful interference, we wonder whether the NHS should play a role in challenging weak or invalid patents.

Patent litigation is not cheap, nor easy. However, rather than incurring substantial costs buying branded medicine, or waiting for generics to bring patent revocation proceedings, and later suing for damages – it may be in the interests of the NHS to be more proactive.

Of course, the NHS may be squeezed and strained in many different directions and among its myriad functions and services, patent examination and opposition are not currently included! Still, the NHS is so beholden to patent litigation and clearly picking up the tab for expensive branded medicines, when time and again the patent protection for the relevant drug is shown to be invalid in court or the EPO.

The courts did not make a finding as to whether the patentee in Servier had been deceitful or not. But where patentees’ conduct is improper, and patents are wrongly granted or upheld, it leaves patients and the NHS to pick up the tab.

IP Insight – Unlawful interference: NHS seeks damages from a patentee for “wrongfully” defending an invalid patent was written by Ellie Wilson

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