LEO Pharma victorious against generic drug manufacturer

In LEO Pharmaceutical Products Ltd A/S v Kotra Pharma (M) Sdn Bhd (Case 1-22-57-2001, January 13 2009), theMalacca High Court has ordered that a Malaysian generic drug manufacturer stop using the marks AXCEL FUSIDIC and AXCEL FUSI-CORTE.
LEO Pharmaceutical Products Ltd A/S, the famous Danish manufacturer of pharmaceutical products, sued a local manufacturer of generic drugs, Kotra Pharma (M) Sdn Bhd, for trademark infringement and passing off.
LEO Pharma owns Malaysian registrations for the trademarks FUCIDIN and FUCICORT for pharmaceutical products. For many years, LEO Pharma has manufactured and distributed antibiotic preparations containing fusidic acid and corticosteroid under these marks. In addition, LEO Pharma has widely promoted and marketed pharmaceutical products bearing the marks in Malaysia and in many countries around the world.  
Kotra sold and distributed two pharmaceutical products under the trademarks AXCEL FUSIDIC and AXCEL FUSI-CORTE.
Before the court, Kotra argued, among other things, that the words 'fusidic' and 'fusi-corte' are international non-proprietary names or generic names. Consequently, these words should not be monopolized by one company. Further, Kotra argued that LEO Pharma’s marks were descriptive of the ingredients used in the relevant goods - namely, fusidic acid and corticosteroid. In addition, Kotra claimed that allowing the marks at issue to remain on the Trademarks Register would significantly affect the growth of the Malaysian generics industry. Accordingly, Kotra counterclaimed for cancellation of the marks.
Following a long and controversial trial (during which pharmacists, doctors and other witnesses from the pharmaceutical industry were called), the Malacca High Court ruled in favour of LEO Pharma on both claims.
The court was satisfied that the FUCIDIN and FUCICORT marks were not generic or descriptive. On the contrary, the court held that the marks had acquired substantial reputation and goodwill in Malaysia and were distinctive of LEO Pharma's products. The court thus granted:
  • a permanent injunction preventing Kotra from infringing LEO Pharma’s registered marks by using, in the course of trade, the trademarks AXCEL FUSIDIC and/or AXCEL FUSI-CORTE, and/or any marks comprising the words 'fusidic' and/or 'fusi-corte', and/or any other marks confusingly similar to LEO Pharma’s marks; and
  • a permanent injunction preventing Kotra from passing itself off as LEO Pharma or attempting to pass itself off as LEO Pharma, or causing or assisting others to pass off pharmaceutical products as those of LEO Pharma by using, in the course of trade, the marks AXCEL FUSIDIC and/or AXCEL FUSI-CORTE and/or any imitation thereof.
In addition, the court ordered that Kotra (whether acting by itself, or through its directors, officers, servants or agents), within seven days of the date of the order, deliver up and surrender to LEO Pharma’s agents or any designated third party all pharmaceutical products and all containers, packaging, inserts, signboards, advertising materials, wrappers or other printed materials in the possession, custody or control of Kotra which bore the infringing marks.
The court also awarded costs to be taxed and ordered an inquiry to assess the damages suffered by LEO Pharma. Finally, the court held that Kotra had failed to establish the counterclaim and dismissed it with costs.
It is believed that this is the first case in which a generics company has sought to cancel a well-known trademark belonging to an established company on the grounds that the mark has become publici juris. The decision is a warning to the local generics industry that any attempt to imitate a well-known trademark on the pretext that it is a generic may not find favour with the courts.
Teo Bong Kwang, Wong Jin Nee & Teo, Kuala Lumpur

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