Is orphan exclusivity a new IP right?

There has been no consensus so far on whether data and market exclusivity can be perceived as IP rights. Recently, the legal categorization of market exclusivity for orphan medicines was proposed by the District Court of Munich in a dispute over a biosimilar based on the active substance Eculizumab.

The biosimilar medicine was authorized (upon expiry of data exclusivity) for the German market for only one therapeutic use, and it was about to be placed on the market (upon expiry of market exclusivity). In the opinion of the holder of MA for the relevant orphan drug, this would infringe orphan exclusivity due to the possibility of the medicine’s off-label use for the protected orphan indication.

The court, under the threat of draconian penalties for the defendant, prohibited the offering, placing on the market, or use of medicinal products containing eculizumab in Germany, unless the court’s guidelines regarding information and promotional activities were complied with.

Such a far-reaching decision was possible due to the prior categorization of orphan exclusivity as a subjective right, effective against all and everyone (erga omnes), enforceable directly against generic manufacturers on the grounds of tort liability. The court found that the right to orphan exclusivity is positive in nature, granting the right to use the protected product, and also negative, prohibiting such use by third parties. In this regard, the right to market exclusivity is no different to intellectual property rights. Furthermore, the judgment states that orphan exclusivity covers not only placing the product on the market, but also offering and importing or possession for these purposes, and thus this scope closely resembles that of a patent or SPC.

The judgment is as revolutionary as it is controversial. Article 8(1) of Regulation 141/2000 does not indicate that the legislator intended to formulate orphan exclusivity as an exclusive IP right. On the contrary, this provision clearly refers to the regulatory status of orphan medicinal products and the intention to ensure market exclusivity by preventing the drug authorization bodies from allowing the same or similar active substances to enter the market for the protected orphan indication. The purposive interpretation applied by the court goes against the clear wording of the provisions of Regulation 141/2000. As a result, this interpretation of Article 8(1) of Regulation 141/2000 seems impossible in Poland considering the doctrine of numerus clausus of exclusive IP rights.

The judgment may be groundbreaking with respect to legal categorization of orphan exclusivity in the EU, and thus for determining the scope of actions constituting infringement of orphan exclusivity and the means by which the right holder can pursue claims.

Polish courts have not yet addressed the issue of infringement of regulatory exclusivities under Polish law – the issue of orphan exclusivity requires a different approach than the one proposed in Munich, although some of the arguments from the commented judgment could be applied to infringement of market exclusivity of reference medicines. The practical importance of both issues cannot be overestimated for innovative and generic companies.

Author: Żaneta Zemła-Pacud, PhD



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