SmithKline Beecham’s patent for rosiglitazone maleate (Avendia) upheld

Rosiglitazone maleate (Avendia) is a patented drug used for the treatment of type II diabetes, which is manufactured by SmithKline Beecham (SKB) (now GlaxoSmithKline).

When Israel drug manufacturers Unipharm and Trima started manufacturing generic versions, SKB filed for an injunction and damages. Unipharm and Trima’s defence was that the patent in question was invalid, since it lacked novelty and inventive step in light of a European patent previously filed by SKB that published before the priority date of the infringed patent.

The District Court upheld the patent and found that the generic product, Rosi, produced by Unipharm and Trima infringed. However, lack of sales rendered the issue of unfair trade and compensation moot. The decision was appealed to the Israel Supreme Court.

In the appeal, Unipharm and Trima claimed that the District Court was wrong to determine that since there was novelty and inventive step, the issue of whether the patent in question was a selection patent did not need addressing.

They argued that although a preferred salt had been isolated, it could not fairly be used to extend the term of protection beyond the expiry date of the earlier patent. They also argued lack of enablement. Finally, they pointed out that although rosiglitazone maleate was alleged as superior to other salts, no evidence was provided.

The Supreme Court ruled that even were the wide Claim 1 to be invalidated, Claim 4 for the specific rosiglitazone maleate could survive on its own merits if shown to be novel and inventive as it was supported by the specification. It also defended the principle of ‘at risk’ manufacture, pointing out that invalidity is good defence for patent infringement.

“Until a patent issues, there is no asset. Thus, unjust enrichment by misappropriating the asset cannot take place.”

The Court of First Instance was impressed by the patentee’s witnesses and by the fact that the defendant’s witness admitted that rosiglitazone maleate was novel. The fact that the patentee could show trial and error in the research programme, that it considered other salts such as hydrochloride more likely to be appropriate and almost gave up the project for lack of progress was indicative that the selected salt is not obvious. The Court of Appeal saw no reason to overturn this ruling.

Pointing out that the Israel Patent Law for novelty requires enabling disclosure, the court noted that nowhere is rosiglitazone maleate mentioned in the earlier patent, and so was novel. By virtue of the earlier patent teaching basic salts and the present invention being an acidic salt, and in view of its improved efficacy, higher solubility and stability, the rosiglitazone maleate was also inventive.

The court pointed out that the ease of copying of the patented salt by the competitors after reading the disclosure in the patent is evidence that the description is enabling.

Can unjust enrichment be used to justify an injunction against infringers of a patent before it issues?

In another important ruling, the Israel Supreme Court upheld a refusal of the Tel Aviv District Court to grant an injunction to Merck, the applicant for a patent for Focalin, a drug used to treat osteoporosis. Citing unjust enrichment, Merck filed for an injunction against generic manufacturers Teva, Unipharm, Trima and Dr Zevulun Tomer (owner of Unipharm) to prevent them from manufacturing generic equivalents of Focalin 70 mg whilst opposing the patent and preventing it from issuing.

Merck’s argument was that although the patent law provides for retroactive compensation for exploitation by others during the opposition period, should a patent eventually issue, the damage in this case is irreversible and no adequate compensation is possible. Following the 1981 A.Sh.I.R. ruling, it claimed that the IP laws and unjust enrichment can coexist.

The generic manufacturers argued that the Israel Patent Law provides a correct balance between the interests of both sides and also takes into account the public interest. Until a patent issues, there is no asset. Thus, unjust enrichment by misappropriating the asset cannot take place.

They also pointed out that the public interest is in competitive markets and inexpensive drugs. Monopolies exist only where the legislation grants them and it is against public policy for the court to extend monopolies where the law does not provide them.

The Court of First Instance rejected Merck’s application for an injunction, and Merck appealed to the Supreme Court, claiming that the issue had been ruled on narrowly based legal grounds without sufficient regard to the business context, which they claimed was characterised by inequitable behaviour.

The Supreme Court rejected the appeal, ruling that the Israel Patent Law correctly balances various interests, and the law of unjust enrichment only applies where there is no legislative solution.

Michael Factor is a partner at JMB, Fa©tor & Co. He can be contacted at: mfactor@israel-patents.co.il