What should pharmaceutical enterprises do when their patents are infringed?

HM&P's Managing Partner Nguyen Van Phuc and Legal Associate Nguyen Nhat Duong share HM&P's insight in The Saigon Times (No. 39-2023) on 28 September 2023. Below is the English version translated by HM&P of this article:

Recently, the U.S. Supreme Court ruled on a pharmaceutical lawsuit over a patent dispute in the pharmaceutical industry between Amgen Inc. and Sanofi[1]. The dispute arose from the fact that both Amgen and Sanofi have successfully developed drugs to lower cholesterol by inhibiting PCSK9, which promotes the removal of cholesterol from the bloodstream. Each company successfully developed and marketed a unique antibody drug specific to PCSK9: Amgen's Repatha and Sanofi's Praluent. Amgen's patent claimed only 26 antibody amino acid sequences but later claimed all bases could inhibit PCSK9. Following this declaration, Amgen sued Sanofi for infringement. However, in a recent U.S. Supreme Court ruling, Amgen's claim was dismissed because they only described their invention for a certain number of amino acid chains, excluding the entire amino acid base. This decision has been eagerly awaited by those interested in the field of pharmaceutical inventions. It can be seen that patent disputes in the pharmaceutical industry have always been a hot topic both domestically and abroad due to the privileges that a patent can bring to its owner. At present, many companies disregard the provisions of patent protection and arbitrarily use the patents of other companies in order to produce drugs for distribution and sale to consumers at significantly lower costs and prices, which directly affects the interests of protected companies. In this article, from an intellectual property dispute between pharmaceutical enterprises in reality, the author mentions the patent protection of pharmaceutical enterprises in Vietnam when their patents show signs of being infringed by others.

1. Disputes over the manufacture of branded pharmaceuticals

Source: https://thesaigontimes.vn/

In Vietnam, on 15 July 2020, the Superior People's Court in Ho Chi Minh City issued Judgment No. 35/2020/KDTM-PT[2] resolving the intellectual property rights disputes between the plaintiff, MS&D Company ("MS&D"), and the defendant, DVP Pharmaceutical Company Limited ("DVP"). Accordingly, MS&D is a pharmaceutical company based in the United States and is the owner of Patent No. 7037 for phosphoric acid salts of dipeptidyl-peptidyl IV inhibitor, process for their preparation, pharmaceutical compositions containing them and their use. It was granted in Vietnam on 05 May 2008. Later, MS&D used this patent to manufacture drugs under the trade names Januvia® and Janumet®. However, in 2014, MS&D discovered that DVP's Zlatko-100 and Zlatko-50 drugs contained the key compound protected by Patent No. 7037. MS&D then took the necessary steps, including filing a lawsuit against DVP with the People's Court of Binh Duong Province. The court granted all of MS&D's claims. DVP then appealed to the Ho Chi Minh City Superior People's Court. Due to errors and violations in the handling of the case at the first instance level, the Court of Appeal overturned the first instance decision. At the same time, the Binh Duong Provincial People's Court was instructed to resolve the case in accordance with the first-instance procedure. Thus, from the time DVP was found to have shown signs of patent infringement to the time of the appellate decision, the dispute between MS&D and DVP has lasted more than 06 years with no end in sight.

2. Dispute settlement in the Court and keys point for pharmaceutical companies consider

When choosing to litigate intellectual property disputes, pharmaceutical companies that own patents must pay close attention to the burden of proof in intellectual property infringement cases. In the above case, one of the reasons for the Court of Appeals to overturn the trial court's decision was that the trial court used MS&D's Inspection Conclusion, which failed to show the identity/equivalence between the subject matter under examination and the protected subject matter. Specifically, MS&D's patent has 22 points claiming protection, of which point 4 states the characteristics of the protected object about the molecular structure of the compound in the form of crystals. Meanwhile, according to the presentation made by DVP, the active ingredient that make up DVP's products have the basic characteristics of the molecular structure of the compound in the form of crystals. However, the Inspection Conclusion submitted by MS&D to the Court of First Instance did not demonstrate the identity/equivalence between the active ingredient used by DVP and the branded drugs protected under point 4 (in the form of crystals). The reason given by MS&D is that DVP did not produce any drugs at the time of the assessment and therefore MS&D could not obtain the test sample. As a result, MS&D only requests assessments based on DVP's dossiers and documents for the registration of the drug distribution license.

According to Point b Clause 1 Article 39 of the Decree 105/2006/ND-CP amended by the Decree 119/2010/ND-CP, one of the contents of an intellectual property inspection is to determine whether the object under inspections meets the conditions to be considered an infringement factor of intellectual property rights. For patents, the infringement factor may be in the form of products or their parts that are either identical or equivalent to the products or parts of products protected by the patent[3]. At the same time, according to Clause 1 Article 48 of the Decree 105/2006/ND-CP, the inspection organization and inspector may take the inspection samples themselves (certain artifacts are infringement factors and intellectual property objects are being protected) or request the applicant to provide them. Thus, the inspection must be based on the inspection sample, which is the object to be inspected and the protected object (which are active ingredients). The inspection cannot be performed for documents related to these active ingredients.

In addition, as stipulated in Clause 1 Article 25 of the Decree 105/2006/ND-CP, the provision of relevant samples, artifacts, and documents of relevant samples, artifacts are also the obligation of the subject who has protected intellectual property rights to prove the infringement of intellectual property rights by other subjects.

In short, when initiating lawsuits against subjects showing signs of infringement of their patent rights, pharmaceutical companies must request the inspection organization to take samples of the subjects for inspection or provide the inspection organization with samples of the subjects to be inspected. The purpose of this is to verify the identity/equivalence between the tested items and the protected items.

3. Some necessary actions before filling a lawsuit in court or arbitration

Currently, the provisions of the laws allow pharmaceutical companies that own patents to exercise the right of self-defense before filing a lawsuit in court or arbitration to resolve disputes. Self-defense can be carried out through the following methods:

3.1. Requiring the subject showing signs of infringement to cease and desist.

The laws allow the patentee to request the subject showing signs of infringement to cease and desist, and at the same time to apologize, make public correction and pay compensation. Therefore, from the stage of detecting signs of IPR infringement, pharmaceutical companies must collect all documents to prove the infringement, which may include inspecting both the product under review and their protected product to send to the infringer. At the same time, pharmaceutical companies also need to accurately determine the losses they have suffered from the infringement and demand compensation from the infringers.

3.2. Requesting competent State authorities to deal with the infringement

As a rule, the fact that the intellectual property rights holder requests the infringing party to stop the infringing act will not bring favorable results. Therefore, the laws allow the owner of intellectual property rights to request relevant state agencies to deal with the infringement by the infringer.

According to the provisions of the Intellectual Property Law, various authorities, such as courts, inspection, market administration, customs, public security and people's committees at all levels, have the authority to take action against any infringement of intellectual property rights within the scope of their duties and powers. If a pharmaceutical company discovers an infringement by other entities in Vietnam, the pharmaceutical company may request the Inspectorate of the Ministry of Science and Technology to conduct an inspection to deal with the infringement.

Although the laws do not require pharmaceutical companies to exercise the above rights of self-defense before filing a lawsuit in court, taking the above actions will also help them collect more documents and evidence to prove the infringement of intellectual property rights.

In conclusion, in parallel with investing huge costs in research and invention of branded drugs, pharmaceutical enterprises must pay close attention to the issue of protecting their patents against the risk of intellectual property infringement. In cases where disputes arise and need to be resolved in court, pharmaceutical companies should also pay attention to their obligations regarding the collection and submission of evidence to the court. This will ensure that the dispute is resolved quickly and the damage to their business is minimized.

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