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06 November 2017
As is commonly known, a trademark owner's right to oppose the repackaging of an imported medicinal product may be waived only if the following Bristol-Myers Squibb (BMS) conditions are met:
Since their adoption, the BMS conditions have often been debated before both the European Court of Justice (ECJ) and the national courts, particularly in Belgium.
In September 2016 Merck Sharp & Dohme (MSD) launched an action before the Brussels Commercial Court to oppose PI Pharma's parallel import into Belgium of one of MSD's medicinal products, whose active ingredient is montelukast.
In Belgium, MSD sells this medicine under the SINGULAIR trademark in different forms (ie, chewable tablets of 4 milligrams (mg) and 5mg and 10mg tablets for swallowing) and in different pack sizes (ie, 28 or 98 tablets).
In February 2016 the Federal Agency for Medicines and Health Products (the Medicines Agency) compelled MSD to change the representation of its trademark by using one colour instead of two.
In other EU states, including Poland, MSD had also been marketing its medicinal product under the SINGULAIR trademark (reproduced in two colours) in the form of chewable tablets of 4mg and 5mg and 10mg tablets for swallowing, in packs of 28 tablets.
In January 2015 PI Pharma informed MSD that it had obtained authorisation to import into Belgium the SINGULAIR medicinal product that MSD had marketed in Poland. PI Pharma further stated that, as it intended to import packs of 98 tablets into Belgium, it would proceed with the repackaging of the exported products.
MSD objected to the proposed repackaging and sued PI Pharma on the basis of alleged violation of the first, third and fourth BMS conditions.
On April 27 2017,(2) the Brussels Commercial Court granted MSD's claim based on the following breaches of the BMS conditions.
Breach of the first BMS condition
The court considered that PI Pharma's repackaging was not "objectively necessary", as MSD had demonstrated that the original packaging of 28 tablets (containing two blisters) was large enough to contain 70 additional tablets (ie, 5 blisters). PI Pharma could therefore have entered the market segment of 98 tablets while keeping the original packaging, on which it would have been sufficient to affix new labels with the legal notices required to import the product into Belgium.(3)
Breach of the third BMS condition
In application of the ECJ's judgment in Orifarm (C-400/09), the court reiterated that in the case of repackaging, the name of the undertaking responsible for repackaging (ie, the undertaking that carries out the repackaging or on whose instructions repackaging is carried out) must be clearly indicated on the outer packaging so that the end user is informed that the original trademark owner is not responsible for the repackaging.
In the case at hand, the court considered that the identification on the outer packaging of the companies responsible for the importation, the manufacture of the imported product and the marketing of the product in the exporting state, respectively, was insufficient, as no party was clearly identified as being responsible for the repackaging. In this respect, the court noted, the fact that the Medicines Agency had declared in an email to the importer that it could drop the words "repackaged by" did not justify violation of one of the BMS conditions, as the Medicines Agency is an administrative agency that has no say in horizontal extra-contractual relationships between two companies.
Breach of the fourth BMS condition
The court also held that, as the owner of the original trademark was compelled by the Medicines Agency to change the representation of its trademark by adopting one colour instead of two, the parallel importer must also respect this constraint. In that regard, the court considered that the parallel importer must keep up to date with all changes made to the reference medicinal product (including changes made to the original trademark affixed to it). Failing to do so would result in the presentation of the imported medicine being outdated and inadequate and would be likely to undermine the trademark owner's reputation.
In light of the above breaches, the court found that PI Pharma's repackaging infringed MSD's trademark rights. The Brussels Commercial Court ordered PI Pharma to stop commercialising the product and imposed a recall measure.
Although this is not the first time that the Brussels Commercial Court has been involved in a dispute over the parallel importation of medicinal products, the above judgment is noteworthy as it further refines the scope of certain BMS conditions as follows:
For further information on this topic please contact Sophie Lens or Philippe de Jong at ALTIUS by telephone (+32 2 426 1414) or email (firstname.lastname@example.org or email@example.com). The ALTIUS website can be accessed at www.altius.com.
(4) The case under examination distinguishes itself from the Cozaar case, in which a Supreme Court judgment of November 7 2016 upheld the Brussels Court of Appeal's October 21 2014 judgment regarding the lower court's decision that repackaging was, in the case at hand, objectively necessary as it was physically impossible to insert 98 tablets into the original packaging of 28 tablets.
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