Tokyo District Court Decision dated October 28, 2024 (Reiwa 6 (yo) 30029) Provisional Disposition Petition Case under the Unfair Competition Prevention Act

1. Summary of the case

In this case, Samsung Bioepis Company Limited (hereinafter referred to as “Samsung”) filed a provisional disposition application against Bayer HealthCare LLC (hereinafter referred to as “Bayer”) based on the Unfair Competition Prevention Act.

Samsung applied for approval to manufacture and sell “Aflibercept intravitreal injection 40 mg/mL ‘GRP’”, a follow-on biologic of Bayer's product “Eylea®”. However, Bayer provided information to the Ministry of Health, Labour and Welfare, claiming that the product infringed on its patent (Patent No. 7320919, hereinafter referred to as “the patent”). As a result, Samsung was able to obtain approval by deleting “age-related macular degeneration (wAMD) with subfoveal choroidal neovascularization” from the initial indication.

Samsung argued that Bayer's provision of information constituted “misrepresentation of facts” as defined in Article 2, Paragraph 1, Item 21 of the Unfair Competition Prevention Act, and filed a provisional injunction to seek an injunction against similar acts.

2. Court Decision

The Tokyo District Court rejected Samsung's petition, taking into account the following points

(1) The purpose of the patent linkage system

The Japanese patent linkage system is designed to ensure a stable supply of generic drugs by collecting patent information on original drugs and checking for patent infringement at the time of approval screening for generic drugs. Under this system, patent holders are allowed to submit patent information reports and state their opinions on patent infringement.

(2) Application of Article 2, Paragraph 1, Item 21 of the Unfair Competition Prevention Act

The act of a competitor notifying false facts that damage the business credit of another is considered to be an act of unfair competition under the Unfair Competition Prevention Act. However, the patent holder stating his or her opinion on whether there is a conflict with a patent under the patent linkage system is not immediately considered to be illegal. In particular, even if that opinion differs from the final judgment of the court, it does not constitute an act of unfair competition as long as it is not an arbitrary provision of information and does not lack reasonableness in light of the purpose and objective of the system.

(3) Judgment in this case

In this case, the issue was whether Bayer's statement to the Ministry of Health, Labour and Welfare that Samsung's products infringed the patent in question was a problem. The court ruled that even if Bayer's opinion differed from the court's final judgment, this did not immediately constitute a false statement of fact, and it was not considered to be significantly lacking in reasonableness in light of the purpose of the patent linkage system.

3. Commentary

This case provides important insights into the scope of application of the Unfair Competition Prevention Act in relation to the provision of information by patent holders under Japan's patent linkage system.

(1) Operation and transparency of the patent linkage system

Japan's (semi) patent linkage system is operated in accordance with the Ministry of Health, Labour and Welfare's notifications, and the provision of information by patent holders affects the approval examination of generic drugs. However, since the decision-making process and reasons are not disclosed, there are issues with transparency and fairness. In this case too, Bayer's provision of information had an impact on the deletion of indications for Samsung's product, and there is a need to ensure transparency in the operation of the system, and we believe that the idea that patent linkage should be made statutory should be considered in light of this case.

(2) The patent holder's act of providing information and the Unfair Competition Prevention Law

Whether or not the patent holder's act of providing information to protect his or her patent rights falls under the category of “false notification of facts” under the Unfair Competition Prevention Law depends on the truthfulness of the information provided and the appropriateness of the act of providing the information. In this case, the court did not find that Bayer's act immediately constituted an act of unfair competition. This was probably a desperate measure because patent linkage is not legally stipulated, but it is also thought to be a problem because patent linkage is not fully legally stipulated.

(3) Issues for the future

Taking this case as an opportunity, in order to introduce a full-fledged patent linkage system rather than the current pseudo-patent linkage, a system design that ensures transparency and fairness is required. In particular, in designing a system for the introduction of a genuine patent linkage system, it is thought that measures such as considering the impact of information provided by patent holders on the approval of generic drugs, and providing opportunities for the public disclosure of the decision-making process and for the exchange of opinions between the parties concerned, will be necessary.