The evolution of Russian court practice on medicament handling

26.07.2011

We have recently seen a surge in interesting litigations pertaining to various aspects of medicament handling, with results that might have a direct impact on the strategies pursued by medicine manufacturers. Although Russia’s law system is not judge-made, court rulings are still decisive for the purposes of applying legislation. 

In this article, we consider judgements that are momentous for the industry.

1. Full-scale clinical trials are required for registering generics administered by injection or infusion

A domestic manufacturer developed an anticancer pharmaceutical analogous (generic) to that of a foreign manufacturer used as an anti-tumour drug on the Russian market, which was followed by a fast-track registration procedure based on Clause 11, Article 19 of Federal Law No. 86-FZ of 22 June 1998 “On Pharmaceuticals” (1).

Subsequently, however, the Federal Supervisory Service for Healthcare and Social Development (Roszdravnadzor) cast doubt on the efficacy and safety of the medicine and issued an order suspending registration on the grounds that this generic’s “clinical trial results did not justify the performance of this generic when prescribed for administration in accordance with its information leaflet”.

The manufacturer challenged this Roszdravnadzor order in the courts.

The Healthcare and Social Development Ministry of Russia argued in the proceedings that the new generic was a parenteral medicine for administration by injection and, as such, could not have been registered on the basis of bioequivalence (pharmacokinetic equivalence) studies.

This argument was supported by a document entitled “Qualitative Study of Bioequivalence of Pharmaceuticals. Methodological Guidelines” approved by the Russian Healthcare and Social Development Ministry on 10 August 2004. According to the Guidelines, bioequivalence assessment is to be carried out for all durable action dosage forms; pharmaceutical forms ensuring immediate release of the medicine upon intake (pills, capsules, suspensions, etc., excluding solutions); transdermal therapeutic systems; rectal and vaginal suppositories and combined medications (in terms of essential components).

The Federal Arbitration Court for the Moscow Circuit agreed, in its decision, with the Ministry for Healthcare and Social Development and stated that full-scale clinical trials were required to confirm the generic’s therapeutic equivalence to the original medication in terms of efficacy.

The Russian manufacturer even endeavoured to challenge the judgements in the Supreme Arbitration Court of the Russian Federation, but this judicial body (virtually the last instance) held that full-scale clinical trials are required to confirm therapeutic equivalence of generics (2).

2. There has been a considerable increase in litigation over protection of intellectual property rights. This category of dispute is very specific and difficulties arise with respect to issues related to pharmaceuticals.

In March 2011, a case was considered on violation of exclusive rights to a medicine’s trade mark.

The essence of the case is that a foreign company manufactures an eye medicine under the trade name “OCUVITE”. At the same time, two Russian companies started using the name “Okovit” (OKOvit) for manufacturing and distributing food additives for eyes as well. This name was noted on the packaging of the food additives.

The plaintiff (a foreign company) asserted that the defendant used the names “OKOVIT” and “OKOvit”, which are confusingly similar to its trade mark, in relation to homogeneous goods and services.
The defendant indicated that the trade marks were different and, at the time of the dispute, the plaintiff produced not mineral supplements but only medicines under the trade mark “OCUVITE”.

The court of first instance took the side of the Russian companies and stated that the similarity of the names “ocuvite” and “okovit” on account of the first two letters (ok) does not testify to confusing similarity.

The courts of appeal and cassation did not, however, uphold the conclusion of the inferior court and sided with the plaintiff. To prove that the foreign company was right, an opinion poll had to be ordered from the Institute of Sociology, which showed that the majority of respondents felt that the above names (“OCUVITE” and “OKOvit”) were confusingly similar.

In addition to a ban on use of the trade mark, the plaintiff asked the courts to prohibit one of the companies using the name “OKOvit” in the domain name “okovit.ru”.

The plaintiff asserted that the Internet provides information on food supplements labelled “OKOVIT” and “OKOvit” and backed up its arguments with an ANO RCIC certificate and a notary’s protocol of evidence dated 16 February 2010 (i.e., the content of the Internet page was fixed in the presence of a notary public).

As a result, the court:
• prohibited use of the names “OCOVIT” and “OKOvit” on the packaging of food additives when put on the market and offered for sale.
• prohibited use of the name “OKOvit” in the domain name “okovit.ru”.
• required the Russian company to withdraw from trade and destroy, at its own expense, the packs of food additives bearing the names “OCOVIT” and “OKOvit”.
• recovered from the Russian company compensation for breach of the trade mark rights in the amount of 100,000 roubles and the costs of the government fee in the amount of 30,000 roubles.

Conclusion: The above examples from judicial practice show a significant increase in disputes in the pharmaceutical industry.
Disputes arise between companies, between companies and government bodies, etc. and are characterised by considerable specifics inherent to the industry. Knowledge of these, coupled with details of the arbitration process, allows companies to assert their rights and interests in the most important instance - in court.

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(1) Federal Law No. 86-FZ of 22 June 1998 “On Pharmaceuticals” is now inoperative owing to enactment of Federal Law No. 61-FZ of 12 April 2010 “On Medicaments Handling”, which preserves the rules on fast-track registration of generics.

(2) Determination of the Supreme Arbitration Court of the Russian Federation of 19 January 2011.

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