February 08 2017
In June 2016 the Maritime and Commercial High Court invalidated AstraZeneca's Danish quetiapine sustained release patent and revoked a preliminary injunction in a litigation against Teva Denmark A/S and Accord Healthcare Ltd (for further information please see "Quetiapine patent invalidated – Danish court follows suit"). The decision was appealed.
The separate question of Teva's claim for damages was decided subsequently (Accord settled this question with AstraZeneca). On January 24 2017 the Maritime and Commercial High Court awarded Teva €13.45 million in damages and €594,000 in legal costs.(1)
Teva documented the actual market situation after the preliminary injunction regarding generic market entrances, parallel importers and price development and – on that basis – identified the period relevant for the claim for damages. As the market situation during this period changed several times, Teva also defined sub-periods reflecting each specific market situation.
For each sub-period, Teva made individual assumptions regarding generic market penetration, its potential market share and price erosion, and estimated its loss of profits by subtracting the average cost of producing and selling Quetiapine Teva (ie, cost of goods sold) from the estimated loss of sales.
Teva estimated its loss of profits at €16.98 million and claimed €16.8 million.
The statement of damages was supported by a statement from Ernest & Young and a witness testimony from Teva's associate director.
The court found that Teva had suffered a loss as a result of the unjustified preliminary injunction and that Teva should be placed in a position equal to that if the preliminary injunction had not been granted.
The court found that Teva had proven that it had suffered a substantial loss, but as its assumptions were subject to some uncertainty, the court estimated the damages to be €13.45 million.
The legal costs awarded covered Teva's court fee (€20,236) and costs of three reports from court appointed experts (€36,193). The remaining €537,830 covered reasonable costs for legal assistance in the preliminary injunction case and two oral hearings in the present case. Teva's costs for assistance from a patent attorney were specifically not reimbursed.
It is difficult in Denmark to argue patent invalidity in preliminary injunction proceedings despite invalidity judgments in other jurisdictions (for further information please see "No particular importance attached to European invalidity judgments regarding European patent"). As a result, there are likely to be more cases regarding damages as a consequence of unjustified injunctions.
As far as is known, the Teva judgment is the largest amount of damages ever awarded in a Danish patent case and will therefore be subject to thorough review when constructing arguments on damages in future cases.
The result seems attributable to the thorough statement of damages and the apparently qualified assumptions made by Teva. Paying greater attention to the statement of damages can therefore pay dividends.
Danish law also entitles the injured party to loss of reputation. Despite no wording in the judgment in this regard, the specific circumstances regarding the invalidation of AstraZeneca's patent in multiple jurisdictions may therefore have had a minor impact on the award of damages.
The judgment is likely to be appealed.
For further information on this topic please contact Jeppe Brinck-Jensen or Kamilla Kelm Demant at Accura Advokatpartnerselskab by telephone (+45 3945 2800) or email (email@example.com or firstname.lastname@example.org). The Accura Advokatpartnerselskab website can be accessed at www.accura.eu.
(1) See here for a link to the judgment (in Danish).
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