Pharmaceutical IP and competition law in France: overview

A Q&A guide to pharmaceutical IP and competition law in France.

The Q&A gives a high level overview of key issues including patents, trade marks, competition law, patent licensing, generic entry, abuse of dominance and parallel imports.

For information on pharmaceutical pricing and state funding, manufacturing, marketing, clinical trials, advertising, labelling, and product recall and liability, visit Medicinal product regulation and product liability in France: overview.

To compare answers across multiple jurisdictions, visit the Pharmaceutical IP and competition Country Q&A tool.

The Q&A is part of the global guide to life sciences law. For a full list of jurisdictional Q&As visit www.practicallaw.com/lifesciences-guide.

Contents

Patents

1. What are the legal conditions to obtain a patent and which legislation applies? Which products, substances and processes can be protected by patents and what types cannot be patent protected?

Conditions and legislation

Patentability is subject to the following main conditions:

  • Novelty.

  • Inventiveness.

  • Possible industrial application.

In addition, the invention must not be contrary to public order or ethics, or human dignity.

The Intellectual Property Code contains conditions for patentability (Articles L. 611-10 to L. 611-19, Intellectual Property Code).

Scope of protection

The patentability of pharmaceutical products is subject to general regulations on patents. Any medicinal product or related substance can be patented provided that conditions required by the Intellectual Property Code are met (see above, Conditions and legislation).

Some categories are not patentable, such as (Article L. 611-10, Intellectual Property Code):

  • Discoveries, scientific theories, mathematical methods, aesthetic creations, games or computer programs.

  • The human body, at various stages of its formation and development, including the embryo.

Only inventions that combine a natural element with a technical process enabling it to be isolated or produced for an industrial application can be the subject of a patent application.

In addition, specific regulations apply to pharmaceutical products' protection. As the active ingredient of a pharmaceutical product is usually patented long before its effective marketing, the parts of the patent that correspond to the authorisation can be protected for an additional period of time by a supplementary protection certificate (certificat complémentaire de protection) (SPC) (Article L. 611-3, Intellectual Property Code).

 
2. How is a patent obtained?

Application and guidance

An application for a patent is filed with the National Institute of Industrial Property (Institut National de la Propriété Industrielle) (INPI).

The INPI website (www.inpi.fr/fr/brevets.html) provides guidance on the application procedure and fees. The following fees apply:

  • EUR36 (printed form) or EUR26 (online form) must be paid within one month of filing a patent application. The fees increase progressively up to EUR790 per year for the 20th year.

  • The annual fee for an SPC is EUR940 and its filing cost is EUR520.

  • Additional fees must be paid for the review of the application by the INPI (that is, EUR520 for the search report and EUR90 for granting the patent).

Process and timing

The application must contain all information relating to the invention, including (Article R. 612-3, Intellectual Property Code):

  • A description of the invention, accompanied by drawings where appropriate.

  • One or more claims to define the scope of protection the inventor is applying for.

  • An abstract of the technical content of the invention.

Within 18 months of the application date, the INPI must publish notification of filing of the application in the Official Bulletin of Industrial Property. This aims to ensure that third parties are informed of the patent application (Article R. 612-39, Intellectual Property Code).

The INPI issues a preliminary search report (rapport de recherche préliminaire). Contrary to European patents, there is no opposition procedure for French patents. However, third parties can file observations within three months from the date of publication of the preliminary search report. The applicant can answer these observations or file new claims in light of them. Then, the INPI issues the final search report summarising the elements of prior art that can be considered when assessing the patentability of the invention (Article L. 612-14, Intellectual Property Code). After the search report is issued, the INPI will grant the patent. A reference to the grant of a patent is published in the Official Bulletin of Industrial Property.

The INPI only carries out a formal review of the application before accepting it. The INPI verifies that the application is complete and meets the formal requirements. The INPI is not qualified, except in case of obvious lack of novelty, to refuse the grant of a patent. Only courts can assess the validity of a patent in light of the legal requirement of the Intellectual Property Code (see Question 30).

 
3. How long does patent protection typically last? Can monopoly rights be extended by other means?

Duration and renewal

Patents are granted for a term of 20 years from the day of the application and are not renewable (Article L. 611-2, Intellectual Property Code).

Extending protection

SPCs can be granted for pharmaceutical products, for a period of no more than five years from the end of the patent (Regulation (EC) No. 469/2009 concerning the supplementary protection certificate for medicinal products). Medicinal products can also be protected by an extension of six months of the SPC for paediatric use (Regulation (EC) No. 1901/2006 on medicinal products for paediatric use).

 
4. How can a patent be revoked?

The granting of a patent is subject to limited investigations by the INPI. Once the patent has been granted, a subsequent more complete investigation can be initiated and the patent revoked in court. Any person with an interest can ask a civil court for revocation of the patent if the patent does not comply with the substantial requirements of the Intellectual Property Code. This applies to inventions that are not patentable, that lack novelty or inventive step. A patent can also be revoked by a court decision if the invention is not disclosed in a manner sufficiently clear and complete to be carried out by a person skilled in the art or if its subject matter extends beyond the content of the application as filed.

Revocation can also be pronounced if after a limitation, the scope of the protection conferred by the patent has been extended or if there is no support in the description to admit such limitation (Article L. 613-25, Intellectual Property Code).

In addition, patent protection is subject to payment of annual fees. If the fees are not paid when due, the holder has an additional six-month period to pay them, as well as a surcharge. If they are still not paid after this period, the patent holder loses rights to the patent (Article L. 612-19, Intellectual Property Code).

 
5. How is a patent infringed? How is a claim for patent infringement made and what remedies are available?

Conditions for infringement

The patent gives the holder the right to prohibit direct use of the invention, in particular (Article L. 613-3, Intellectual Property Code):

  • Manufacturing, offering, putting on the market, using, importing, exporting or transhipment of a product subject matter of the patent.

  • Using a process which is the subject matter of the patent.

All indirect uses of the invention, by supply of means, are also prohibited (Article L. 613-4, Intellectual Property Code).

Any violation of these rights amounts to an infringement and the infringer is civilly liable, and it is possible to seek its criminal liability.

Claim and remedies

Infringement proceedings must be brought by the patent holder and/or by the exclusive licensee before the court of first instance (Tribunal de Grande Instance) of Paris which has exclusive jurisdiction over patent matters in France. A non-exclusive licensee can only join an action commenced by the patent holder and/or by the exclusive licensee. At the holder's request, the judge can order seizure of the infringing products and subsequent measures to stop the infringement. In addition, damages can be awarded to the patent holder and to the licensees.

Infringement can be a criminal offence if the holder can prove the infringer has acted dishonestly. Any breach of these rules is punishable by (Article L. 615-14, Intellectual Property Code and Article 131-18, Criminal Code):

  • Three years' imprisonment and a fine of EUR300,000 for natural persons and EUR1,500,000 for legal persons.

  • Five years' imprisonment and a fine of up to EUR500,000 for natural persons or EUR2.5 million for legal persons if the infringing goods are considered hazardous to human health.

 
6. Are there non-patent barriers to competition to protect medicinal products?

Medicinal products are protected by a period of eight year data exclusivity from the date of MA of the innovator's product. This applies to reference products for which an application for an MA has been submitted after 30 October 2005.

This protection period is further extended by (Article L. 5121-10-1, Public Health Code):

  • Two years of additional marketing protection.

  • One year of additional marketing protection, if the innovator qualifies for a further marketing authorisation for a significant new therapeutic indication for the same medicinal product during the eight years of exclusivity protection.

 

Trade marks

7. What are the legal conditions to obtain a trade mark and which legislation applies? What cannot be registered as a trade mark and can a medicinal brand be registered as a trade mark?

Conditions and legislation

To obtain trade mark registration, a sign must comply with the provisions of Articles L. 711- 1 to L.711-4 of the Intellectual Property Code, and notably it must:

  • Be capable of a graphic representation which serves to distinguish the goods or services of a natural or legal person.

  • Be distinctive.

  • Not be an armorial bearing, flag or other state emblems.

  • Not be deceptive or contrary to public order or morality.

  • Not infringe prior intellectual property rights.

During the examination procedure, the INPI will verify whether the trade mark application meets the above conditions, except infringement of prior intellectual property rights (Article R. 712-10, Intellectual Property Code).

Directive (EU) 2015/2436 harmonising trade mark laws in the EU has removed the requirement of graphic representation for a sign to be registered as a trade mark. This provision will be implemented into French law by 14 January 2019.

Scope of protection

The registration of pharmaceutical product brands is subject to the general regulations regulating trade marks. The FPHC contains specific additional rules concerning trade marks. The name of the pharmaceutical product can be (Article R. 5121-2, Public Health Code):

  • An invented name.

  • A common name, or a scientific name followed by the trade mark or the name of the marketing authorisation holder, or the company ensuring the exploitation of the pharmaceutical product.

To be accepted, the registered mark must not create any confusion with other pharmaceutical products (Article R. 5121-4, Public Health Code).

It is also possible to register as a trade mark the three-dimensional shape of a product or its packaging, as long as the shape is distinctive.

 
8. How is a trade mark registered?

Application and guidance

An application for registration of a trade mark is filed with the INPI. The INPI website (www.inpi.fr/fr/marques.html) provides guidance on the application procedure and fees.

The fee depends on the number of international classes of products and services for which protection is required. The initial application is subject to payment of EUR250 (or EUR210 for an electronic application) for the first three classes, and EUR42 for each additional class.

Directive (EU) 2015/2436 harmonising trade marks laws states that member states can provide in their legislation a "one-fee-per-class" system instead of a "three classes for the price of one", by 14 January 2019.

Process and timing

Ownership of a trade mark is acquired by registration. The application must contain, in particular (Article R. 712-3, Intellectual Property Code):

  • Administrative information related to the applicant's identity.

  • A sample of the item to be trade marked.

  • A list of the goods and services to which it applies.

A registration number is then assigned to the application and within six weeks the INPI publishes notification of the filing in the Official Bulletin of Industrial Property (Article R. 712-6, Intellectual Property Code).

Within two months of the date of publication, any interested person can submit observations to the Director of the INPI or lodge a formal opposition against the trade mark registration (for example, if the trade mark has already been registered) (Article L. 712-3, Intellectual Property Code).

If it is not successfully opposed and the trade mark complies with the Intellectual Property Code, the trade mark is registered in the National Register of Marks and published in the Official Bulletin of Industrial Property.

 
9. How long does trade mark protection typically last?

Trade mark protection lasts for ten years and starts from the date the application was filed. The trade mark protection can be renewed for successive ten-year periods, without limitation (Article L. 712-1, Intellectual Property Code).

 
10. How can a trade mark be revoked?

The trade mark can be revoked in the following circumstances:

  • The owner of the registered trade mark can withdraw his trade mark for all or part of the goods or services by a notice of surrender (Articles L. 714-2 and R. 714-1, Intellectual Property Code).

  • The registration can be declared void if it does not comply with the legal requirements of the Intellectual Property Code by a judicial court decision (Articles L. 711- 1 to L. 711-4, Intellectual Property Code).

  • However an owner that has acquiesced to the use of a later registered trade mark for a period of five successive years is barred from bringing an action for invalidity, unless the trade mark has been filed in bad faith (Article L. 714-3, Intellectual Property Code).

  • An owner who has not exploited his/her trade mark during an uninterrupted period of five years, without good reason, is liable to revocation of his rights by court decision (Article L. 714-5, Intellectual Property Code).

Directive (EU) 2015/2436 states that member states will provide for an administrative procedure of revocation or declaration of invalidity before the INPI.

 
11. How is a trade mark infringed? How is a claim for trade mark infringement made and what remedies are available?

Conditions

Trade mark registration provides the holder with exclusivity of use (for the goods and services designated in the application) and a right to prevent all third parties from using the mark in the course of trade without its consent.

An offender can be civilly liable for any infringement of the holder's rights. Infringement can consist of (Article L. 713-3, Intellectual Property Code):

  • Use or reproduction of an identical trade mark for goods or services identical to those designated in the trade mark registration.

  • Use by imitation implying a risk of confusion:

  • use of an identical trade mark for goods or services that are similar to those designated in the registration; or

  • use of an similar trade mark for goods or services that are similar or identical to those designated.

Claim and remedies

The trade mark holder (exclusive and non-exclusive) can pursue infringement proceedings before one of the civil courts with jurisdiction over trade mark matters in France. The courts can order the seizure of infringing products and subsequent measures to end the infringement. Damages can be awarded to the trade mark holder (exclusive and non-exclusive). As with patent infringement, criminal prosecution can also be pursued.

Any breach of these regulations is punishable by three years' imprisonment and a fine of EUR300,000 for natural persons and EUR1.5 million for legal persons (Article L. 716-10, Intellectual Property Code and Article 131-38, Criminal Code).

 
12. Outline the regulatory powers and enforcement action against counterfeiting in the pharmaceutical sector.

The EU has adopted Directive 2011/62/UE to tackle counterfeit medicines. This text was transposed into French and defines a "falsified medicine" as a medicine with a false representation of its identity, its source or its history (Article, L. 5111-2, Public Health Code).

In France, the main public bodies entrusted with regulatory powers and entitled to take enforcement action against counterfeiting of medical products are the following.

The ANSM is in charge of implementing a surveillance and alert scheme with respect to falsified medicines. The ANSM pharmacists inspectors can report any breach to the FPHC, including falsification of medicines. The ANSM can further test the products suspected of being falsified medicines in its control laboratories.

The French Customs are competent to control the entire French territory in terms of importation, exportation, circulation and detention. French Customs have a wide range of regulatory powers and enforcement actions against counterfeiting medicinal products, in particular (Article 414, Customs Code):

  • Suspension of the release of and detention of suspected counterfeit products.

  • Inspections of products and premises.

  • Seizures.

  • Sharing of information with right holders and other competent authorities.

  • Monitoring of deliveries.

  • Destruction of counterfeiting products.

  • Sanctions provided for in the French Customs Code (Code des douanes).

Within French Customs, Cyberdouane is more specifically in charge of monitoring the internet. Article 67 bis of the French Customs Code provides for specific enforcement powers applicable to the most serious criminal offences, including counterfeiting of medicinal products. If such an offence is suspected, certain Customs officers can conduct infiltration and surveillance operations.

A section of the French Police is dedicated to pharmaceutical criminality, including counterfeiting of medicines. Its action is co-ordinated by the Central Office for combating environmental and public health harm (Office Central de Lutte contre les Atteintes à l'Environnement et à la Santé Publique) (OCLAESP), implemented by Decree No. 2004-612 of 24 June 2004. The OCLAESP is composed of police and military agents and is assisted by technical staff, including a public health pharmacist. Its criminal investigation powers are complemented by powers to request international assistance for the purpose of dismantling criminal networks.

The above regulatory bodies co-operate on a regular basis, that is, they work together and with all relevant stakeholders in the framework of the PANGEA operations carried on a yearly basis under the aegis of Interpol, with the aim of shutting down online offers of fake medicines and dismantling criminal networks.

Counterfeiting of medicinal products is a criminal offence under the:

  • Intellectual Property Code.

  • Public Health Code.

  • Customs Code.

  • Consumers Code.

Depending on the legal basis, the competent body will involve the competent criminal courts or start legal proceedings. Where the criminal offence involves infringement of IP rights, the action taken by the public authorities does not prevent the rights holder from joining the proceedings or starting its own legal proceedings before the civil courts.

 

IP and competition law issues

13. Briefly outline the competition law framework in your jurisdiction and how it impacts on the pharmaceutical sector. In particular, the competition authorities and their regulatory powers, key legislation, whether pharmaceutical investigations are common, key recent activity and case law.

Competent authorities and regulatory powers

The French Competition Authority (Autorité de la Concurrence) (FCA) (www.autoritedelaconcurrence.fr) is an independent administrative authority in charge of enforcing competition law in France.

The FCA has a dual organisation, with a clear separation between the investigation services and the decisional body, called the College.

Under Article L. 462-5 of the French Commercial Code (FCC), the FCA can act:

  • On its own initiative.

  • On application by the French Minister for the Economy.

  • Following a complaint by companies or any other party showing an interest such as trade unions, representative consumer associations, and so on.

However, complaints can also be brought before competent commercial and civil courts, with a view to obtain damages, either on a stand-alone basis or following a finding of an infringement by the FCA (follow-on actions).

The FCA has jurisdiction over matters relating to infringements of Articles L. 420-1 and L. 420-2 of the FCC (and their European equivalent, Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU)) relating, respectively, to the prohibition of anti-competitive agreements and concerted practices, and abuses of dominant position.

On finding an infringement, the FCA can (Article L. 464-2 FCC):

  • Impose fines, up to 10% of the group's worldwide turnover.

  • Order the practices to cease.

  • Order publicity measures.

It can also, in cases raising competition concerns as to the potential existence of abusive practices or vertical restraints, accept commitments from the parties to remedy such concerns, without finding of an infringement.

In addition, Article L. 464-1 FCC provides for the possibility to impose necessary interim measures before any finding of infringement, in cases where there is a serious and immediate risk of harm to the economy, the sector concerned, consumers, or the claimant. The FCA has from time to time used this prerogative, including in the pharmaceutical sector, where it last imposed an injunction of publication on Schering-Plough in 2007, in relation to the marketing of Subutex and its generics.

The FCA's decisions can be appealed before the Paris Court of Appeal and, ultimately, before the French Supreme Court (Cour de cassation).

In addition, the FCA also has an advisory role on any matter raising competition law issues, a prerogative which is widely used. In the pharmaceutical sector, the FCA notably issued an opinion on 19 December 2013 (see below, Key recent activity), as well as an opinion on 20 July 2012 concerning a draft decree relating to the supply of medicines for human use in the French market (Opinion No. 12-A-18).

The FCA also has jurisdiction to review mergers when certain turnover thresholds are met. Under Article L. 430-2 of the FCC, a merger must be notified to the FCA when:

  • The combined worldwide turnover of the parties exceeds EUR150 million.

  • The individual turnover generated in France by at least two of the parties exceeds EUR50 million.

  • The operation does not have a community dimension (that is, it is not caught by the European thresholds).

Specific lower thresholds also apply to mergers concerning the retail sector and markets in overseas territories.

Key legislation

With respect to anti-competitive practices, the FCA is competent to apply Articles L. 420-1 and L. 420-2 FCC, as well as, when relevant, Articles 101 and 102 TFEU. The fines that can be imposed by the FCA are calculated on the basis of the criteria laid down in Article L. 464-2, I of the FCC.

In addition to the rules specifically set out in the FCC, the FCA has adopted various communications, for example on:

  • Its methodology to set financial penalties.

  • The French leniency programme.

  • The commitments procedure, designed to bring more legal certainty to companies.

These communications are considered as soft law. They engage the FCA, which is normally bound to follow them. However, the FCA can also from time to time depart from its guidelines when the specific circumstances of a case require so, provided that it objectively justifies the decision.

Key recent activity

In 2015, the FCA adopted 20 decisions, including nine decisions finding an infringement and five commitments decisions.

Regarding in particular the pharmaceutical sector, the FCA recently dismissed a complaint brought by certain categories of wholesale distributors (CAP and SRA) in relation to the distribution of OTC products (Decision 16-D-01 of 20 January 2016). The complainants were alleging abusive refusals to sell by various pharmaceutical companies, as well as anti-competitive agreements to exclude them from the market.

On 19 December 2013, the FCA issued an opinion relating to the functioning of competition in the field of retail distribution of pharmaceutical products for human use (Opinion No. 13-A-24). This opinion, which was adopted following a sector enquiry and public consultation of relevant stakeholders, provides an overview of the current context in France and contains a series of recommendations aimed at enhancing competition in the pharmaceutical sector.

Several cases concerning the pharmaceutical sector are still pending before the FCA, including the investigation against Janssen-Cilag France (a subsidiary of Johnson & Johnson) in relation to the marketing of Fentanyl and its generics.

 
14. Briefly outline the competition issues that can arise on the licensing of technology and patents in a pharmaceutical context

The FCC does not contain any specific provisions relating to technology transfer agreements (including licensing agreements). However, such agreements are covered by the rules set out in Regulation (EU) 316/20014 of 21 March 2014 on the application of Article 101(3) of the TFEU to categories of technology transfer agreements (Technology Transfer Block Exemption Regulation, which replaced the old version of 2004).

Under the Technology Transfer Block Exemption Regulation, technology transfer agreements which contain restrictions to competition benefit from a general exemption under Article 101(3) of the TFEU, provided that:

  • The parties' market shares do not exceed certain thresholds (20% if the licensor and licensee are competing companies, and 30% if they are not-competing companies).

  • Such agreements do not contain any hard-core restrictions such as price fixing or market sharing.

When the parties' market shares exceed the above thresholds, the agreement can still benefit from an individual exemption provided that it meets the four cumulative conditions of Article 101(3) of the TFEU.

With respect to the pharmaceutical sector, the Paris Court of Appeal lodged a request for a preliminary ruling to the European Court of Justice (ECJ) on 9 December 2014 ( Genentech Inc. v Hoechst GmbH, formerly Hoechst AG, Sanofi-Aventis Deutschland GmbH (Case C-567-14)). The question submitted to the ECJ relates to the interpretation of Article 101 TFEU and more particularly whether this provision precludes effect being given, where patents are revoked, to a licence agreement which requires the licensee to pay royalties for the sole use of the rights attached to the licensed patent. The case is still pending before the ECJ but Advocate General Wathelet presented his opinion on the case on 17 March 2016, in which he proposed to answer negatively, provided that the licensee:

  • Is able to terminate the licence agreement by giving reasonable notice.

  • Is able to challenge the validity or infringement of the patents.

  • Retains its freedom of action after termination.

 
15. Are there competition issues associated with the generic entry of pharmaceuticals in your jurisdiction?

Patent settlements

There has not yet been any case law in France dealing with competition issues associated with the generic entry of pharmaceuticals which arise in the context of the settlement of a patent dispute between an originator and a generic pharmaceutical company.

At European level however, following the adoption by the European Commission on 8 July 2009 of its final report on its competition inquiry into the pharmaceutical sector, the latter has imposed severe fines on both originator and generic pharmaceutical companies in three pay for delay cases involving Lundbeck, Johnson & Johnson/Novartis and Servier. In addition, patent settlements between originator and generic companies are monitored annually by the European Commission. The latest report was published on 2 December 2015 and covers the period from 1 January to 31 December 2014.

Patent litigation

In a case which did not concern the pharmaceutical sector (Decision No. 01-D-57 of 21 September 2001), the FCA ruled that a dominant firm is allowed to legally defend its intellectual property rights, including before competent courts, without it constituting an abuse of dominance prohibited by Article L. 420-2 of the FCC.

Disparagement of generics

The FCA adopted two decisions in 2013 in which it sanctioned, on the ground of Article L. 420-2 FCC and Article 102 TFEU, anti-competitive practices of dominant firms aiming at hindering market access for the generic versions of their medicines, notably through disparagement campaigns of the generics.

In a first decision (Decision No. 13-D-11 of 14 May 2013), the FCA imposed a fine of more than EUR40 million on Sanofi-Aventis for having abused its dominant position by implementing, at the time of generic entry, a communication strategy towards healthcare professionals aiming at limiting the substitution of Plavix by generic versions of competitors, both at the prescription stage by doctors (who were encouraged to include a mention of "non-substitutable") and at the substitution stage by pharmacies (which were encouraged to only substitute Plavix by Sanofi-Aventis' own generic version). Sanofi-Aventis notably insisted, when promoting its products, on the allegedly lesser efficiency and safety of competitors' generic versions. On 18 December 2014, the Paris Court of Appeal dismissed the appeal of Sanofi-Aventis. The case is now pending before the French Supreme Court (Cour de Cassation).

In a second decision (Decision No. 13-D-21 of 19 December 2013), the FCA fined Schering-Plough and Reckitt Benckiser for having implemented a strategy consisting of closing off the access to the market for generic versions of Subutex. In particular, the FCA found that Schering-Plough abused its dominant position by:

  • Disparaging generic versions of Subutex.

  • Offering loyalty rebates to pharmacies with a view to saturate their shelves with Subutex.

Reckitt Benckiser was sanctioned for having taken part in this anti-generic strategy as the manufacturer of Subutex and licensor of rights to Schering-Plough, appointed as the exclusive licensee for sales in France. Schering-Plough did not appeal the FCA's decision. On 26 March 2015, the Paris Court of Appeal dismissed the appeal of Reckitt Benckiser. The case is currently pending before the French Supreme Court (Cour de cassation).

 
16. Have abuse of dominance issues arisen in the pharmaceutical sector in your jurisdiction?

In addition to recent cases involving disparagement practices (see Question 15), the FCA is still investigating the practices of Janssen-Cilag France in relation to the marketing of Fentanyl and its generics. Following a complaint of generic company Ratiopharm (which was later withdrawn), the FCA refused to grant interim measures in this case, but decided to carry on its investigation on the merits of the case (Decision No. 09-D-28 of 31 July 2009). The FCA alleges that Janssen-Cilag France would have abused its dominant position by:

  • Implementing a disparaging communication strategy to limit the entry of generic versions of Fentanyl on the market.

  • Offering large discounts to hospitals, amounting to a total price close to zero and therefore possibly predatory.

Further, the FCA imposed a fine of EUR7.8 million on Sandoz (now part of the Novartis group) in 2003 (Decision No. 03-D-35 of 24 July 2003) for having abused its dominant position by offering to hospitals discounts conditional on the combined purchase of:

  • Two very expensive pharmaceutical products containing cyclosporine as an active substance, for which Sandoz was in a dominant position.

  • Other so-called "priority" products for which Sandoz faced competition (tied sales).

The non-purchase by hospitals of the "priority" products exclusively from Sandoz resulted in the refusal by Sandoz to grant the discounts on the total purchases of the hospital concerned, including on the cyclosporine products.

 
17. Have parallel imports of pharmaceuticals raised IP and competition law issues in your jurisdiction?

Parallel imports of pharmaceutical products in France remain very low compared to other European countries. In 2012, it amounted to a turnover of EUR15 million, representing less than one thousandth of the total turnover generated by the sale of reimbursable pharmaceutical products in France in the same year (see Opinion No. 13-A-24 of 19 December 2013).

However, because of the regulatory framework, France is much more exposed to parallel exports of pharmaceutical products originally placed on the French market, which resulted in quota restrictions being imposed by certain pharmaceutical companies on the sale of their products to full line wholesalers and short liners. The FCA considered that, because of the specificity of the products concerned and the regulatory framework (that is, administered price for reimbursable medicines), quota restrictions imposed by pharmaceutical companies are admissible, subject to certain conditions.

In a first decision adopted following a complaint of French exporters (that is, short liners) (Decision No. 05-D-72 of 20 December 2005), the FCA examined the quota restrictions imposed by several pharmaceutical companies which limited their deliveries to French exporters and, eventually, refused to supply them. The FCA considered that such refusal to sell was not abusive nor constituted an abusive discrimination with full-line wholesalers which had continued to receive products.

Subsequently, in another case (Decision No. 07-D-22 of 5 July 2007 and Decisions No. 07-D-45 and 07-D-46 of 13 December 2007), the FCA analysed the quota restrictions imposed by pharmaceutical companies on full-line wholesalers. The FCA admitted the principle of such restrictions provided that they are strictly necessary for a sound and optimal supply of the French market, while maintaining real competition possibilities between wholesalers, including a possibility to export the products. The FCA was still concerned by the lack of transparency of the quota systems submitted to its review and, following commitments offered by the pharmaceutical companies concerned, made binding the suggested changes to their quota systems. These commitments are still in force today and provide a framework for quota restrictions in the pharmaceutical sector in France.

 
18. Does a patent or trade mark licence agreement and payment of royalties under it to a foreign licensor have to be approved or accepted by a government or regulatory body? How is such a licence made enforceable?

There is no requirement for a patent or trade mark licence agreement with a foreign licensor, including the royalties to be paid under the agreement, to be approved by any government or regulatory authority in France.

To be enforceable against third parties, the patent or trade mark licence agreement must however be recorded with the INPI (Article L.613-9 of the FIPC for patents, and L.714-7 of the FIPC for trade marks).

 

Contributor profiles

Marianne Schaffner

Dechert LLP

T +33 1 5757 8080
F +33 1 5757 8081
E marianne.schaffner@dechert.comrt.com
W www.dechert.com

Qualified. Paris, 1997

Areas of practice. Intellectual property; healthcare law

Recent transactions

  • Advising successfully a US manufacturer of medical products in the context of a patent infringement action.
  • Advising successfully a French biotechnology company in a cross-border litigation (US-Europe) in relation to contract and patent infringement.
  • Advising the shareholders of a French biotechnology company in the sale of 100% of the shares of the company to a Swiss pharmaceutical group.
  • Advising a French multinational pharmaceutical and cosmetics company in multiple proceedings in France related to patent infringement.
  • Advising a Japanese multinational pharmaceutical company in the context of a patent nullity action.
  • Advising a French multinational manufacturer of optical devices in the context of a complaint for breach of contract.
  • Advising a French biotechnology company in transactional matters regarding the manufacture of an experimental medicinal product.

Julie Sérusclat

Dechert LLP

T +33 1 5757 8080
F +33 1 5757 8081
E julie.serusclat@dechert.com
W www.dechert.com

Qualified. Paris, 2008

Areas of practice. Intellectual property; healthcare law

Recent transactions

  • Advising successfully a French biotechnology company in a cross-border litigation (US-Europe) in relation to contract and patent infringement.
  • Advising successfully a manufacturer of biochemical products in the context of negotiation of research agreements and patent assignment agreements.
  • Advising a French biotechnology company in transactional matters regarding the manufacture of an experimental medicinal product.

Mélanie Thill-Tayara

Dechert LLP

T +33 1 5757 8104
F +33 1 5757 8081
E melanie.thill-tayara@dechert.com
W www.dechert.com

Qualified. Paris, 1992

Areas of practice. Antitrust and competition, notably in life sciences

Recent transactions

  • Advising an originator in the preparation, validation and implementation of its commercial policy in the context of the launch of a biosimilar competing with one of its major products.
  • Assisting a Swiss-based pharmaceutical company further to an investigation launched by the French competition authority for alleged abuse of collective dominant position in the context of the prevention of off-label use of one of its products.
  • Advising various pharmaceutical companies in the reorganisation of their distribution schemes in the context of a constrained regulatory environment.

Marion Provost

Dechert LLP

T +33 1 5757 8104
F +33 1 5757 8081
E marion.provost@dechert.com
W www.dechert.com

Qualified. Paris

Areas of practice. Antitrust and competition, notably in life sciences


{ "siteName" : "PLC", "objType" : "PLC_Doc_C", "objID" : "1248174054231", "objName" : "Pharmaceutical IP and competition law in France", "userID" : "2", "objUrl" : "http://us.practicallaw.com/cs/Satellite/us/resource/4-615-9355?null", "pageType" : "Resource", "academicUserID" : "", "contentAccessed" : "true", "analyticsPermCookie" : "22e97be00:15b139a611a:27e6", "analyticsSessionCookie" : "22e97be00:15b139a611a:27e7", "statisticSensorPath" : "http://analytics.practicallaw.com/sensor/statistic" }