Arrow misses target, but escitalopram is attacked with fresh Resolution

Yesterday was a good day for Patents Court (England and Wales) judge Mr Justice Arnold. First, in Mylan v Yeda (noted here by the IPKat), his decision was upheld by a Court of Appeal containing two specialist IP judges. Then, no doubt by sheer coincidence, another version of the same Court of Appeal, this time consisting of Lords Justices Longmore, Moore Bick and Floyd, went and upheld him again in Resolution Chemicals Ltd v H. Lundbeck A/S [2013] EWCA Civ 924.

HMS Resolution: not sunk when
earlier Arrow missed its mark

Lundbeck was fortunate enough to hold a European patent and then a supplementary protection certificate (SPC) for escitalopram, a single enantiomer of the compound citalopram (a drug used in the treatment of depression). Way back in 2005 a number of pharmaceutical companies brought proceedings in the United Kingdom to challenge the validity of the UK counterpart of this patent. Those proceedings were unsuccessful.  In the past, Resolution belonged to the same group of companies as Arrow, one of the claimants in the 2005 action. Indeed, Resolution had actually had a go at making a generic version of the drug, but those efforts ended approximately a year before the 2005 proceedings commenced. In 2009 Resolution became an independent company and launched its own proceedings to challenge Lundbeck's SPC and patent. At first instance [noted here on the IPKat by Darren], Mr Justice Arnold held that Resolution could proceed with this challenge because it had had no interest in the drug at the time of the previous proceedings. Lundbeck appealed, arguing that Resolution had stood back and let Arrow fight the proceedings for it and it should therefore be bound by the decision in the 2005 proceedings on the basis of privity of interest.

The Court of Appeal dismissed Lundbeck's appeal. In its view:

* Privity of interest provided an exception to the general principle that estoppel would bind only the parties to previous litigation. The test was whether, having due regard to the subject matter of the dispute, there was a sufficient degree of identity between a party to litigation and a third party so as to act as a bar to the third party commencing a fresh action.

* It was thus for the court to assess on the facts whether there was privity of interest between a new party -- in this case Resolution -- and a party to previous proceedings.  In doing so, it had to examine (i) the extent to which the new party had an interest in the subject matter of the previous action; (ii) the extent to which the new party could be said to be, in reality, the party to the original proceedings by reason of its relationship with that party and (iii) against that background, whether it was just that the new party should be bound by the outcome of the previous litigation.

* Arrow and Resolution were indeed part of a group of companies under common control. There was however no subsisting relationship between them under which it could be said that the 2005 proceedings were being conducted by Arrow for Resolution's benefit.

The IPKat's own earlier
experiments didn't get far

* It made sense for Arrow to apply to revoke Lundbeck's patent as it had an interest in having it revoked. If other companies subsequently acquired an interest in seeing the patent revoked, there was no reason to treat the earlier litigation as having been conducted on their behalf, when it was commenced at a time when they were not affected by the patent. Accordingly, the notion that Resolution had stood back and allowed Arrow to fight its battle failed on the facts. Resolution was not in a position to make the drug, its previous efforts had failed and its efforts had ceased over a year before the commencement of the previous litigation. From that point onward, Resolution's interest was no different from that of any other company with a general interest in generic pharmaceutical products -- and that could not be sufficient to hold it bound by the outcome of the earlier proceedings.

The IPKat thinks Lundbeck can't be blamed for trying its luck here, but it would be difficult to argue with the Court of Appeal's statement of the general principles.  Merpel just wonders how many times escitalopram has been litigated across Europe and beyond.  If ever a patent was a licence to litigate, this is it!