[Ip-health] ECJ Rulings on parallel imports of pharmaceutical products

[Manon Anne Ress]

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New rulings of the European Court of Justice on parallel imports of
pharmaceutical products
David Wood, Bruno Lebrun and Alvaro Ramos
Howrey Simon Arnold & White, LLP, Brussels

Recent rulings of the European Court of Justice provide some guidance on
the extent to which parallel importers can repackage pharmaceutical
products without infringing trademark rights. Interplay between
competition law, trademark protection and the authorisation process is
also examined.


Introduction

Property rights in the European Union (EU), including IP rights, are
essentially national in scope. This gives rights holders the potential
to impede the development of an EU-wide internal market, an area where
goods, services and workers should be able to circulate freely. This
inconsistency has led to a number of restrictions on the ability of
rights holders to exercise those rights, especially in relation to
pharmaceutical products.

For example, there is well-settled case law in the EU that the
repackaging of pharmaceutical products by a parallel importer does not
constitute an infringement of the manufacturer's rights where the new
packaging is objectively necessary for the parallel importer to be able
to market the products effectively in the territory concerned.


Bundling

In a recent case1, the European Court of Justice (ECJ) considered
whether parallel importers are allowed to repackage pharmaceutical
products for resale where bundling would suffice for commercial purposes
but would not be allowed under the relevant legislation.

The case concerned a challenge by Aventis to the practices of parallel
traders who imported Aventis' pharmaceutical product Insuman from France
into Germany. Insuman is normally sold in France in packages of five
cartridges, and in Germany in packages of ten, and is authorised for
sale in both formats.

According to the parallel importers, in order to be able to market
Insuman effectively in Germany, they were obliged to re-package the five
cartridge products imported from France into new packages of ten.
Aventis argued that the parallel importers were not entitled to
repackage but should only bundle two packages of five cartridges, a
lesser interference with its trademark rights.

The ECJ had to decide whether Regulation N=B0 2309/932 (which set up the
European agency responsible for authorising the commercialisation of
medicines throughout the EU), allows a medicinal product that is
authorised for sale in packs of five items and in packs of ten items to
be sold in a package consisting of two packs of five items which have
been joined together and relabeled.

According to the ECJ, the central marketing authorisation defines the
dimension, presentation and form of the packaging to be used for
medicinal products, and the particulars and information to be printed on
the packaging are specific to that packaging. The details and specific
requirements regarding the packaging of medicinal products subject to
central marketing authorisation are intended to prevent consumers from
being misled, and hence to protect public health.

In consequence, the ECJ ruled that the essence of the regulation
providing the central marketing authorisation precluded the bundling of
the packages of those medicinal products. The ECJ went on to rule that,
in circumstances where the sale of bundled products is unauthorised,
parallel importers must be entitled to re-package if this is objectively
necessary for the parallel importer to be able to market the products
effectively in the territory concerned.


Product Enhancement

In another recent case3, the ECJ ruled that, unless it is justified by
reasons relating to the protection of public health, the termination of
a parallel import license following the withdrawal of an authorisation
to market the product in the country of origin constitutes an unlawful
restriction on the free movement of goods.

The facts of the case were as follows: Eurim-Pharm imported into Germany
"Minirin Spray", a medicinal product originally manufactured by Ferring
Arzneimittel GmbH ("Ferring"). After Ferring issued an upgraded version
of this medicine, it sought to prevent the parallel importer from
importing and marketing the old version on the grounds that the original
authorisation had been withdrawn.

The ECJ found for the parallel importer, saying that the parallel import
licence was terminated for reasons other than the protection of public
health. Termination was therefore unlawful and the fact that the
original authorisation to sell the product in the country of export had
been withdrawn was not a defense.


Conclusions

The two cases described above demonstrate how cautious pharmaceutical
manufacturers need to be when applying for authorisation, when packaging
and when marketing their products. In particular, the two cases
demonstrate that pharmaceutical manufacturers should take into account
the likelihood of parallel imports when submitting product packaging as
part of the approval process and when launching enhanced products.

One way or another, parallel importers will find ways of taking
advantage of the internal market rules on the free movement of goods.
The Aventis case may, however, narrow their room for manoeuvre by
pushing them away from bundling towards repackaging, a course that may
be more expensive, and that obliges them to demonstrate that repackaging
is objectively necessary for the parallel importer to be able to market
the product effectively.





1. Case C-433/00, Aventis and Kohlpharma GMBH, MTK Pharma
Vertriebs-GMBH, 19 September 2002, not yet published

2. Council Regulation N=B02309/93 Central Marketing Authorisation and
Supervision of Medicinal Products for Human and Veterinary, OJ, 1993, L
214, p. 1

3. Case C-172/00. Ferring Arzneimittel GmbH v Eurim-Pharm Arzneimittel
GmbH, 10 September 2002, not yet published

--
Manon Anne Ress
Consumer Project on Technology
www.cptech.org
PO Box 19367, Washington, DC 20036
manon.ress@cptech.org, voice: 1.202.387.8030, fax: 1.202.234.5176