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29 July 2019
Bayer HealthCare LLC owned the invention patent ω-Carboxyaryl Substituted Diphenylureas as Raf Kinase Inhibitors. Bayer found that Beijing Mediking Biopharm Co Ltd had displayed information regarding the patented products sorafenib and sorafenib tosylate on its official website and, as an exhibitor at CPhI Shanghai: 2017, had publicised the products on the exhibition boards and brochures.
Bayer complained to the Beijing Intellectual Property Office that Mediking had infringed its patent by offering to sell the above products and requested that the IP office order Mediking to cease and desist. The IP office granted Bayer's petition. The decision is now in force.
This case relates to an infringement determination regarding offering to sell a drug.(1) To prove that the accused products were the same as the patented chemical substances, Bayer relied on the chemical abstract service (CAS) number or generic name of Mediking's products. No technical testing of the products was involved.
Mediking argued that it had not offered to sell the products; rather it asserted that offering to sell can only be established if the product has been manufactured or sold, which it had not engaged in. Mediking argued that it provided manufacturing solutions for the products, not the products per se. It was not a product manufacturer, nor did its business scope, as registered, cover the manufacturing or selling of the products. Further, it did not seek to promote the products for a production or business purpose and thus its actions could not be categorised as advertising. According to Mediking, the promotion was aimed at looking for partners for technical exchange and promotion, not a declaration of its intention to sell the alleged infringed product. Further, there was a disclaimer indicated below the product list, which stated that the "products & their intermediates which are protected by patents in countries will not be sold in those countries. The patent situation should be verified by the customer or the importer". Mediking contended that this disclaimer proved that it had not infringed Bayer's patent.
In reaching its decision, the IP office had to consider:
The IP office held that according to the CAS registry number, chemical name and structural formula shown in the Chinese Approved Drug Names and the CAS database search report as provided by Bayer, the accused products shared identical chemical structures with Bayer's patented compounds and therefore fell within the protected scope of the patent.
The IP office also found that either the product information uploaded to the official website or the product information and status printed on the brochures and exhibition boards at CPhI indicated that Mediking sought to promote the products.
Further, the IP office held that Mediking could be considered a drug production company because the business scope shown on its business licence stated that it was "authorized to produce chemical products", while the official website revealed that it owned 100% of a good manufacturing practice factory and other production enterprises.
Finally, the IP office held that Mediking's disclaimer on the brochures could not exclude the possibility that Mediking intended to promote the product, nor could this be used as a defence to rebut Bayer's claim.
In patent infringement disputes regarding chemical products, it is usually necessary to conduct an infringement comparison. This involves purchasing the accused product and conducting judicial appraisal to determine whether the product falls within the protected scope of the patent.
In this case, the petitioner provided no physical product but furnished documentary evidence to prove that the accused products were the same as the claimed compounds. Mediking displayed the Chinese generic name and CAS registry number of the products on its website, exhibition boards and brochures. Bayer filed sufficient evidence to demonstrate that the products and their chemical structural formula could be uniquely identified by both their generic name and CAS registry number. This enabled a comparison between the product and the claimed compound.
Offering to sell is an independent act of patent exploitation. It is not necessarily established on the premise that the product is physically manufactured or actually sold. That said, a declaration of intent to sell is not necessarily made on the premise that the physical product actually exists.
The Patent Law lists 'offering to sell' as an act of patent infringement in order to give patentees the right to prevent other parties from offering their goods for sale and not merely act once such goods have been sold. Patentees will benefit from protecting their legitimate rights and interests more promptly and efficiently. Mediking's business scope and its affiliated production enterprise proves that it is a drug production company. According to business practice, publicising an accused product by introducing it on an official website obviously promotes the product, thus constituting an offer of sale. By listing the products and their status on the exhibition boards and brochures, Mediking ultimately publicised and promoted the products. Whether the prerequisites as stipulated by law are met should be assessed in determining whether the behaviour constitutes an act of infringement. A disclaimer cannot deny that the behaviour constitutes an offer of sale.
The case explores a timely and cost-efficient way for pharmaceutical patent owners to address similar infringements in future.
The case was selected to be included in the National Ten Exemplary Patent Administrative Enforcement Cases of 2018 by the National Intellectual Property Administration and Ten Exemplary Patent Administrative Enforcement Cases of Beijing of the Year by the Beijing Intellectual Property Protection Association.
For further information on this topic please contact Xiaohui Wu at Wanhuida Peksung by telephone (+86 10 6892 1000) or email (firstname.lastname@example.org). The Wanhuida Peksung website can be accessed at www.wanhuida.com and www.peksung.com.
the patent right is granted for an invention or a utility model, unless otherwise provided for in this Law, no unit or individual may exploit the patent without permission of the patentee, i.e., it or he may not, for production or business purposes, manufacture, use, offer to sell, sell, or import the patented products, use the patented method, or use, offer to sell, sell or import the products that are developed directly through the use of the patented method.
Article 24 of the Several Provisions of the Supreme People's Court on Issues concerning the Application of Law in the Trial of Cases on Patent Disputes provides that the phrase 'offer to sell', as mentioned in Article 11 of the Patent Law, refers to a declaration of an intention to sell a product by means of advertising it, displaying it in shop windows or at a fair exhibition.
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