CJEU Issues Guidance On When Parallel Importers Can Rebrand Generics As Branded Medicines – Trademark

In a recent decision, the Court of Justice of the European Union
(CJEU) issued new guidance on when parallel
importers can rebrand generic medicines with the original trade
mark of the reference medicinal product (C-253/20 Impexeco v. Novartis AG and C-254/20 PI
Pharma NV v. Novartis AG).

Novartis marketed two different medicinal products, one in
Belgium and the Netherlands under the trade mark FEMARA (CASE
C-235/20), and the other in Belgium under the trade mark RILATINE
and in the Netherlands under the trade mark RITALIN (CASE
C-254/20). Novartis’ generic division, Sandoz, sold identical
medicinal products as generics using the names ‘Letrozol Sandoz
2.5 mg’ and ‘Methylphenidate HC1 Sandoz 10 mg’

In 2016 and 2017, Novartis issued trade mark infringement
actions against two Belgian companies, PI Pharma and Impexeco. Both
Belgian companies are active in the parallel trade in medicinal
products. Impexeco and PI Pharma imported the generic Sandoz
products from the Netherlands and then repackaged and rebranded
them for sale in Belgium under the Novartis reference product
names, ‘FEMARA’ and ‘RILATINE’.

Novartis successfully applied for injunctions before the
Brussels Commercial Court. On appeal, the Brussels Court of Appeal
referred several questions to the CJEU.

Essentially, the question for the CJEU was whether the owner of
trade marks for both a reference medicinal product and a generic
medicinal product could prevent parallel imports between EU Member
States of the generic products, where the generic products had been
repackaged in new packaging that displayed the trade mark of the
corresponding reference medicinal product.

The CJEU confirmed that the trade mark owner can prevent such
repackaging, except where:

1. the reference and generic medicinal products are identical in
   all respects; and




2. the replacement of the trade mark satisfies the “BMS
   conditions”.

The CJEU observed that reference and generic products may not
always be identical, despite being therapeutically equivalent. It
noted that products may be identical in all respects in particular
where the reference medicinal product and the generic medicinal
product are manufactured by the same entity or by economically
linked entities and which, in actual fact, constitute one and the
same product marketed under two different sets of rules. The key
question is whether it is established that repackaging is
objectively necessary in order for the parallel imported medicinal
products to be marketed in the latter Member State. In the present
case, the CJEU held that the generic medicinal products at issue in
each of the cases were identical to the corresponding reference
medicinal product.

The CJEU then examined the conditions set out in Bristol-Myers
Squibb and Others (C 427/93, C 429/93 and C 436/93, EU:C:1996:282)
(BMS), as considered in Boehringer Ingelheim and Others (C 348/04,
EU:C:2007:249) and Junek Europ-Vertrieb (C 642/16, EU:C:2018:322).
These cases establish that a pharmaceutical company can rely on
trade mark rights to oppose the relabelling of its medicines in the
EEA unless the following five conditions are met:

1. the use of trade mark rights to oppose relabelling would
   contribute to the artificial partitioning of the markets between
   Member States;




2. it is shown that the repackaging cannot affect the original
   condition of the product inside the packaging;




3. the new packaging clearly states who repackaged the product and
   the name of the manufacturer;




4. the presentation of the repackaged product is not such as to be
   liable to damage the reputation of the trade mark and its
   proprietor;




5. the importer gives notice to the trade mark proprietor before
   the repackaged product is put on sale and, on demand, supplies it
   with a specimen of the repackaged product.

The CJEU considered the necessity of rebranding a generic
product under the trade mark of the reference product to ensure the
free movement of that product in the internal market. In doing so,
it found that where a parallel imported medicinal product cannot be
marketed in the importing Member State under its trade mark of
origin, the replacement of that trade mark is objectively necessary
in order to ensure the free movement of that medicinal product in
the internal market. On the other hand, where a parallel importer
can market the generic medicinal product under its trade mark of
origin by adapting the packaging to satisfy the market requirements
of the importing country, there is no objective
“necessity” to rebrand. In such a case, the free movement
of goods is not threatened, and therefore cannot take precedence
over the trade mark proprietor’s legitimate interests in
opposing relabelling.

The CJEU further noted that a Member State cannot refuse a
parallel import licence for a generic medicinal product if the
corresponding reference product already has marketing authorisation
in that jurisdiction, unless such a refusal is justified by
considerations relating to the protection of health and life of
humans.

Finally, the CJEU held that there was no objective necessity to
rebrand if the rebranding is exclusively motivated by the pursuit
of an economic advantage.

This decision provides a welcome restatement of the BMS
conditions, which should be carefully considered by pharmaceutical
trade mark proprietors and parallel importers alike.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.