The practice of seeking “third party SPCs” has become common in recent years, but will now be reviewed by the CJEU following Mr Justice Arnold’s decision to refer a question on this point in Lilly v Genentech ( EWHC 388 (Pat)).
According to the SPC Regulation, the holder of a basic patent is entitled to an SPC based on the basic patent. The consent of the marketing authorisation (MA) holder (often a party other than the patent holder) is not routinely required to obtain an SPC. This situation does not usually cause issues as there is typically a legal relationship between the two parties. For example, the MA holder may be a licensee under the patent, or the two parties may be part of the same corporate group.
However, sometimes there is no legal relationship between the patent holder and the MA holder. In this situation, an SPC applied for by a patent holder based on an unrelated party’s MA is commonly referred to as a “third party SPC”. Third party SPCs can be problematic for MA holders, who will be required either to take a licence under the SPC or to attempt to have the SPC revoked if they are to commercialise their approved product. For this reason and others, the practice of seeking third party SPCs has not been without criticism and came under renewed scrutiny in Lilly v Genentech.
Genentech applied for a third party SPC on the basis of Lilly’s MA for the product Taltz®. In response, Lilly brought proceedings before the High Court seeking a declaration that Genentech’s SPC, if granted, would be invalid under Articles 2, 3(b) and/or 3(d) of the SPC Regulation due to the lack of a legal relationship between Lilly and Genentech. Lilly sought a referral to the CJEU in an effort to clarify whether these third party SPCs are lawful.
Arnold J granted Lilly’s request for a reference on this point and proposed the following question for the CJEU:
“Does the SPC Regulation preclude the grant of an SPC to the proprietor of a basic patent in respect of a product which is the subject of a marketing authorisation held by a third party without that party’s consent?”
There will now be a chance for the parties to discuss the wording of this question before the final reference is made to the CJEU.