In a January 2025 judgment, the Court of Appeal upheld the judgment of the High Court (Patents Court) in the case of Merck Serono S.A. (Appellant) v The Comptroller-General of Patents, Designs, and Trade Marks (Respondent).
The appeal centred on Merck's unsuccessful request for a supplementary protection certificate (SPC) for a new medical use of the previously-authorised active ingredient cladribine and whether the UK could and should depart from pre-Brexit case law of the Court of Justice of the European Union (CJEU) in Santen (C-673/18).
CASE BACKGROUND
Merck applied for an SPC for cladribine based on European patent EP 1 827 461 and marketing authorisation EU/1/17/1212 for its MAVENCLAD product, which is indicated for the treatment of highly active relapsing remitting multiple sclerosis.
The primary issue in this case was whether Merck's application met the requirements of Art. 3(d) of retained EU law Regulation (EC) No. 469/2009 (the ‘SPC Regulation’), which stipulates that the marketing authorisation relied on for the SPC application must be the first authorisation to place the product on the market as a medicinal product. In 2020, the interpretation of Art. 3(d) was dramatically changed when the CJEU in Santen (C-673/18) overturned its earlier position from Neurim (C-130/11) (see our article here), thereby returning to a straightforward literal interpretation.
In accordance with that interpretation of Art. 3(d), Merck’s application was refused by the UK Intellectual Property Office (UKIPO) due to the existence of two earlier marketing authorisations for medicinal products containing cladribine as an active ingredient: LEUSTAT and LETAK, issued in 1995 and 2004, respectively. Merck appealed the decision to the Patents Court, which dismissed the appeal as the Court indicated that it too was bound by the CJEU’s interpretation of Art. 3(d) in Santen. Merck was granted leave to appeal to the Court of Appeal on the sole ground that Santen was wrongly decided and that the Court of Appeal should depart from it.
COULD THE COURT OF APPEAL DEPART FROM SANTEN?
Before considering the question of departure, the Court of Appeal first had to consider whether it could depart from the Santen judgment.
Under the European Union (Withdrawal) Act 2018 (Relevant Court) (Retained EU Case Law) Regulations (SI 2020/1525) (the ‘Withdrawal Act’), judgments like Santen are considered "retained EU case law”, which remains part of UK domestic law and continues to bind lower courts. The Supreme Court can depart from CJEU judgments, but only under the same conditions it would use to depart from its own precedents. The Withdrawal Act (sections 4(1) and 4(2)) grants a similar power to the Court of Appeal, enabling the Court to depart from retained EU case law, but only provided that the Court is not already bound by post-transition case law that modifies or applies it.
In its own February 2024 judgment in Newron (CA-2023-001357), the Court of Appeal applied Santen for how the “product” should be defined (Art. 1(b) of the SPC Regulation) and thus how to determine which marketing authorisation(s) are relevant to the assessment of eligibility for an SPC. Since the Newron judgment applied the principles from Santen as part of its reasoning, the Court held that Newron constitutes post-transition case law that modifies or applies the retained EU case law. Therefore, despite the differences in the specific aspects of the SPC Regulation in question (Art. 3(b) in Newron vs. Art. 3(d) in the present case), the Court concluded that as Newron was binding under section 4(2) of the Withdrawal Act, the Court is also prevented from departing from Santen.
WOULD THE COURT DEPART FROM SANTEN?
The Court of Appeal further considered whether it would have been appropriate to depart from Newron and Santen if it had been free to do so. The Court evaluated the principles outlined in the 1966 Practice Statement, which allows for departure from precedent under certain circumstances, while emphasising the need for great caution and circumspection when applying this statement.
The starting point was to assess the criticisms of the Santen judgment to determine if they were justified. In doing so, the Court examined the relevant articles of the SPC regulation, which they summarised as follows:
Article 1(b) of the SPC Regulation defines a "product" as the active ingredient or combination of active ingredients of a medicinal product. This definition is crucial as it links the four criteria in Article 3 together. According to Article 3(a), the product must be protected by a patent; Article 3(b) requires a marketing authorisation to place the product on the market as a medicinal product; Article 3(c) specifies that the product must not have already been the subject of a certificate; and Article 3(d) states that the authorisation referred to in Article 3(b) must be the first authorisation to place the product on the market as a medicinal product.
In Newron, the Court held that the meaning of "product" must be consistent across all parts of Article 3 (which the applicant in that case did not contest).
The problem for Merck is that the earlier use of cladribine led to the grant of earlier marketing authorisations, both of which were too old to provide any term for an SPC based on Merck’s patent (i.e. a calculation of zero days). Merck argued that the authorised use of the active ingredient in the current marketing authorisation should be considered, in accordance with the CJEU’s interpretation of Art. 3(d) in Neurim in 2012 that allowed SPCs for new therapeutic applications of known active ingredients where the new marketing authorisation was the first to fall within the scope of the basic patent. Merck argued that the teleological reasoning of the CJEU in Neurim was careful and correct and should be followed. They contended that, otherwise, the SPC Regulation would not achieve its objective for large areas of pharmaceutical research.
After a careful review of the case law on Art. 3(d), the Court of Appeal deemed that Merck’s approach was unbalanced as it did not consider other objectives, including public health and the competing interests of third parties. The Court decided that, even if it had not been bound by Newron, it would not have been appropriate to depart from the judgment of the CJEU in Santen. Further, the Court indicated that the requested policy change on which Merck’s case is based could only sensibly be achieved by legislative amendment.
CONCLUSION
The Court of Appeal held that it was bound by its own Newron judgment affirming the CJEU’s Santen decision in relation to the interpretation of Art. 1(b) and 3(d) of the SPC Regulation, and neither could nor would depart from Santen. The Court therefore dismissed Merck’s appeal.
This case confirms that the UK is continuing to apply pre-Brexit CJEU case law on SPCs, and that, as in the EU, the authorised use of a medicinal product cannot be taken into account when determining eligibility for an SPC.
The decision underscores the complexities the UK faces in diverging from CJEU precedents post-Brexit. While the European Union (Withdrawal) Act 2018 provides mechanisms for higher courts to depart from retained EU case law, the application of these mechanisms is cautious and bound by stringent conditions. The Court of Appeal's reliance on the Newron judgment illustrates the layered nature of legal precedents and the challenges in establishing a clear departure from established EU interpretations.
Looking ahead, the UK's legal landscape may gradually evolve to reflect a more autonomous stance, particularly as new domestic precedents are set and the judiciary gains confidence in interpreting laws independently of CJEU influence. Furthermore, UK courts may show greater readiness to depart from CJEU case law in instances where the CJEU's interpretations have clearly been inconsistent.
