National courts can apply TRIPs and extend patents

Today was also the day for the European Court of Justice to deliver its ruling in Case C‑431/05, Merck Genéricos – Produtos Farmacêuticos Ldª v Merck & Co. Inc. and Merck Sharp & Dohme Ldª, a reference for a preliminary ruling from the Supremo Tribunal de Justiça (Portugal).

The facts from which this reference arose are of some antiquity. Merck & Co owned a Portuguese patent for which an application was filed on 4 December 1979 and which was granted on 8 April 1981. This patent, for a process for the preparation of amino-acid derivatives as hypertensives, was used for making a pharmaceutical product, known as RENITEC, which was marketed from 1 January 1985. Merck Sharp & Dohme was granted the right to exploit that patent in Portugal. In 1996 Merck Genéricos marketed a pharmaceutical product under the trade mark ENALAPRIL MERCK, which it sold at prices appreciably lower than those for RENITEC and which, it claimed, when was the same product as RENITEC. Merck & Co and Merck Sharp & Dohme then sued Merck Genéricos, seeking an order that the latter should refrain from importing, marketing in Portugal or exporting the product at issue under the trade mark ENALAPRIL MERCK or under any other commercial description without their express authorisation, seeking compensation for the material and non-material damage caused by its unlawful conduct.

Merck Genéricos denied liability. In its view the period of patent protection had expired since the period of 15 years provided for by Article 7 of the 1940 Industrial Property Code (the law then applicable in Portugal) ended on 9 April 1996. Merck & Co and Merck Sharp & Dohme disagreed: they said that, by Article 33 of the TRIPs Agreement ("The term of protection available shall not end before the expiration of a period of twenty years counted from the filing date"), the patent ran until 4 December 1999. Merck & Co and Merck Sharp & Dohme lost at first instance. On appeal, however, the Tribunal da Relação (Court of Appeal), Lisbon, ordered Merck Genéricos to pay them damages on the ground that, under Article 33 of the TRIPs Agreement, which had direct effect under Portuguese law, that patent expired not on 9 April 1996 but on 9 April 2001. Merck Genéricos appealed to the Supremo Tribunal de Justiça (Supreme Court of Justice), claiming that Article 33 of the TRIPs Agreement was without direct effect. That court referred to the ECJ the following questions:

"1. Does the Court of Justice have jurisdiction to interpret Article 33 of the TRIPs Agreement?

2. If the first question is answered in the affirmative, must national courts apply that article, on their own initiative or at the request of one of the parties, in proceedings pending before them?".

Ruled the ECJ, apparently unhindered by the fact that the Portuguese court had only sent it the questions and not also its suggested answers:

"As Community legislation in the sphere of patents now stands, it is not contrary to Community law for Article 33 of the Agreement on Trade-Related Aspects of Intellectual Property Rights ... to be directly applied by a national court subject to the conditions provided for by national law".

Says the IPKat, this decision will not only be a great comfort to patent owners - it will also be a reminder to a lot of insular lawyers that TRIPs is actually far more integral to intellectual property law in the European Union than they imagine. Adds Merpel, isn't it annoying that all the parties in this case seem to be called Merck? Was it sheer coincidence, or did someone slip up at the point at which proprietary and generic branches of the pharma company were split up? Or is it the different Mercks coming to blows? Do please let me know!

A brief guide to the different Mercks here
Mercs here