Marks & Clerk Law LLP
Selection, clearance and registration
There has been a marked change in naming conventions for pharmaceutical products over the years, with punchy names commensurate with the blockbuster status of certain drugs (eg, Viagra) or exotic names finding favour over the more staid and serious names chosen historically (eg, Aspirin). Public interest in the avoidance of confusion between drug names, and the increasingly crowded marketplace, further contribute to the complexity of drug naming in today’s market.
Most drugs will have a chemical, international non-proprietary (INN) and an invented (brand) name. Packaging and advertising for regulated medicines must include both the INN and invented name. The latter may be protected as a trademark. There are many benefits to securing trademark registration, including exclusivity in the name, brand/quality recognition and longevity: a trademark can potentially last forever.
The World Health Organisation is responsible for devising an INN following an application from a marketing authorisation holder in respect of a new drug. A key consideration is to ensure that the new INN is not liable to be confused with other names in common usage or with existing trademarks; indeed the owner of an existing mark can object to a proposed INN on the basis that it conflicts with its mark.
Similarly, the marketing authorisation holder’s invented name should not be liable to confusion with an INN or contain an INN stem (common stems being used to refer to pharmacologically related substances). The invented name also must not:
- be liable to confusion with the name of any other medicinal product;
- be misleading with respect to the therapeutic effects, composition or safety of the product; and
- convey promotional connotations.
The inclusion in the name of terms such as ‘fast-acting’ is permitted provided that the term is not misleading. In relation to non-prescription medicines only, informative names which aid the patient in selecting an appropriate product without input from a healthcare professional (eg, ‘pain relief’) will also be permitted. However, should the marketing authorisation holder wish to register a name containing these terms as a trademark, it would also be necessary to incorporate some distinctive element into the mark in order to enable it to distinguish the goods of the owner.
Where a marketing authorisation holder wishes to sell a range of products under a brand family identified by the use of a common umbrella segment this will be permitted only where there are no safety or efficacy concerns resulting from confusion between the products sharing the umbrella segment (eg, where one product in the brand family treated cancer; another headache).
Where a medicine is authorised throughout the European Union under the centralised procedure, it must have the same invented name across the European Union. There is an exception where the owner of an earlier trademark in a particular member state objects to the invented name. In this case, a different name may be used in that member state. However, in view of the principles of free movement within the single market and the need to avoid artificial partitioning, the circumstances in which this applies are exceptional.
The Medicines and Healthcare Products Regulatory Agency (MHRA) or the European Medicines Agency (EMA) (as appropriate) must approve the marketing authorisation holder’s invented name before it can be used. Taken together with the fact that an invented name will not be approved if it is liable to cause confusion with the name of another medicine, direct conflicts between the names of medicines should not occur. However, the system is not infallible and conflicts do sometimes happen, not least because Class 5 is very crowded (more than 150,000 marks on the UK and EU registers; more than 85,000 with a specification containing the word ‘pharmaceutical’) and includes registrations for goods other than regulated medicines (eg, cosmetics, baby food and disinfectants), which have all been held to be similar to pharmaceuticals. Recent examples where likelihood of confusion has been found include MIVACRON and MITOCHRON (T-312/15); and FEMBION and FEMIVIA (T-324/13).
One developing area that marketing authorisation holders may wish to consider when registering trademarks is whether they intend to provide any new technologies (eg, health apps) under their marks. If so, classes of goods and services which might not previously have been considered relevant (eg, software) should also be protected.
In addition, as the recent Glaxo v Sandoz litigation in relation to Glaxo’s trademark for a coloured inhaler demonstrates, in an increasingly competitive marketplace pharmaceutical companies are being forced to consider new strategies for protecting their market share, for instance, through the enforcement of non-traditional trademarks and/or relying on arguments based on unregistered rights. It is therefore anticipated that this is an area in which we will see growth going forwards.
Parallel imports and repackaging
Given the highly profitable trade in pharmaceutical parallel imports where price differences and arbitrage opportunities arise from different national pricing regulations, it is anticipated that the issue of parallel imports will remain a significant area of concern for pharmaceutical companies. Moreover, as recent cases demonstrate, parties are continuing to test the boundaries of what will and will not be permitted. It is not yet known how the issue of exhaustion will be dealt with following Brexit, but whatever is decided it seems inevitable that new legal issues will arise.
From a regulatory perspective, there are no barriers to the parallel import into the United Kingdom of a medicine authorised throughout the European Union under the centralised procedure. Where a medicine is authorised pursuant to a national marketing authorisation in another EU member state, it may be imported into and sold in the United Kingdom provided that it has no therapeutic difference to the equivalent UK product and a parallel import licence is obtained.
From a trademark perspective, however, there are circumstances in which a trademark owner can object to a parallel import. The basic position is that trademark rights are exhausted in relation to goods which have been put on the market in the European Economic Area (EEA) under that trademark by the owner or with its consent, unless there are legitimate reasons for the owner to oppose further dealings in those goods.
Put on the market
Putting goods on the market must involve a sale of goods in the EEA, not just an import or offer for sale. Goods held within a customs depot have not been put on the market.
Consent requires an unequivocal intention to renounce trademark rights. Acts or omissions consistent with consent but also consistent with the absence of consent will not be sufficient. In most cases, consent will need to be express.
A trademark owner will have legitimate reasons to object to a parallel import where the condition of the goods themselves has been altered after the goods were first put on the market.
But what about when products have been repackaged (sold under the same trademark with modified packaging) or rebranded (sold under the different trademark used by the owner in the destination country)? This is where it gets interesting, because these are the more common situations which arise in the context of pharmaceutical products.
In the first case on repackaging, BMS v Paranova, the European Court of Justice (ECJ) determined that repackaging should be permitted provided that the five now well-known Bristol-Myers Squibb (BMS) conditions are satisfied. If these conditions are not met, the trademark owner will have legitimate reasons to oppose the parallel import. The ECJ then confirmed in Pharmacia v Upjohn that the BMS conditions would also apply to legitimatise rebranding except to satisfy the necessity requirement, the rebranding must be truly necessary rather than simply done to secure a commercial advantage.
In SEP v Doncaster the English court clarified that there would be a necessity to rebrand if preventing relabelling would hinder access to the market or a substantial part thereof. The court acknowledged that there were branded and generic markets for the product in question but that because of the prohibition on generic substitution in the United Kingdom, products could be sold only in the branded market (being a substantial part of the market) under the trademark. It was therefore necessary for the parallel importer to rebrand in order to access the branded part of the market. This decision has been criticised on the basis that it results in only one answer: that it is always necessary to rebrand in order to gain access to the branded part of the market. It is certainly clear that the decision favours parallel importers.
However, there are limits. In the recent case of Flynn v DrugsRUs, for example, Pfizer manufactured a drug for both itself and Flynn, to which it had sold its marketing authorisation for the United Kingdom. DrugsRUs sought to import the product put on the market by Pfizer in the European Union and rebrand it for the UK market with the Flynn mark. This was not permitted because although the Flynn product was made by Pfizer, Flynn nevertheless did not have control over the manufacture of the Pfizer product and so there existed legitimate reasons to oppose the rebranding.
What about de-branding, where the owner’s mark is removed altogether? It was traditionally believed that this could not amount to trademark infringement because there was no continued use of the owner’s mark. However, this has been recently challenged by Mitsubishi v Duma Forklifts, where the ECJ held that the removal of Mitsubishi trademarks from Duma forklift trucks was parallel importing and it deprived Mitsubishi of certain rights in its trademarks and thus entitled it to object. The fact that consumers would still recognise the trucks as Mitsubishi products accentuated the harm but was not determinative.
Mitsubishi suggests that the tide may be turning back in favour of trademark owners. However, there is scepticism in the United Kingdom as to whether the decision is correct. Therefore, once the United Kingdom is no longer bound to implement ECJ decisions following Brexit, equivalent cases could be decided differently.
As to the wider implications of Brexit on parallel imports, there remains uncertainty. If the United Kingdom leaves the European Union without a deal, it will continue to recognise the EEA regional exhaustion regime for an unspecified period – but this will not be reciprocated by the EEA. Parallel imports of goods from the EEA to the United Kingdom will therefore be unaffected. However, businesses exporting goods placed on the market in the United Kingdom to the EEA may risk infringing EU trademark rights.
If the United Kingdom does agree a deal, it is not yet known what will be agreed regarding exhaustion after the transition period. The most likely options are international exhaustion or regional exhaustion where the region potentially constitutes the EEA plus the United Kingdom, in which case the existing framework would likely continue to apply.
Anti-counterfeiting and enforcement
As with the majority of counterfeit products, falsified medicines are not generally manufactured in the United Kingdom. The focus of the MHRA, which has responsibility for tackling falsified medicines, is accordingly twofold:
- Preventing falsified medicines from being imported into the United Kingdom – this is principally achieved by the MHRA’s liaison with UK Customs, the registration by marketing authorisation holders of their IP rights with Customs and their education of Customs to assist in detaining counterfeits.
- Removing falsified medicines which have made their way onto the market and taking appropriate enforcement action against offenders.
In the 2017/2018 reporting year, the MHRA obtained criminal convictions against 10 defendants and secured confiscation orders of £2 million.
Enforcement is predominantly by way of criminal prosecutions. However, trademark owners whose marks have been used on counterfeits can also bring civil proceedings for trademark infringement.
The MHRA is also engaged in programmes to educate the public on the dangers of falsified medicines. Its FakeMeds campaign, which provides information and tools to help people avoid fake medicines when shopping online, led to the seizure of more than 9.5 million falsified medical products in the 2017/2018 reporting year. A particular focus on preventing the purchase of ‘dodgy’ diet pills successfully used Instagram as a new messaging channel.
Marketing authorisation holders also have their own part to play in creating elements of product and packaging design which are difficult to copy and facilitate the easier identification of counterfeits. In particular, Delegated Regulation 2016/161 to the EU Falsified Medicines Directive has, since February 2019, required marketing authorisation holders to place two mandatory safety features (a unique identifier which can be scanned at fixed points along the supply chain and tamper evidence features) on packaging.
Only medicines that are authorised by the MHRA or EMA may be advertised in the United Kingdom. Advertising must be in accordance with the scope of the marketing authorisation. For example, the promotion of a medicine for an indication not covered in the Summary of Product Characteristics would not be permitted. Advertising must not exert undue influence on the consumer and must not be misleading. For example, advertising which suggests that a medicine has no side effects or is guaranteed to work would be prohibited. Advertising for herbal and homeopathic medicines must not claim that the effectiveness of the medicine has been demonstrated or imply that a medicine’s use is based on clinical evidence. Advertising must not be directed at children and there is a blanket prohibition on the comparison of one medicine with another. This is different to the general position under consumer protection and trademark law which permits comparative advertising provided that certain conditions are met.
Non-prescription medicines can be advertised to the public in the United Kingdom, but not prescription-only medicines. The latter can be advertised to healthcare professionals.
The rules derive from Part 14 of the Human Medicines Regulations 2012. Breach is a criminal offence. The MHRA is responsible for monitoring and enforcing compliance.
There are also a number of self-regulatory codes which apply to advertising for medicinal products, such as the Association of the British Pharmaceutical Industry Code of Practice, the UK Code of Non-broadcast Advertising and Direct and Promotion Marketing and the UK Code of Broadcast Advertising. The provisions in these codes reinforce the regulations but also frequently go further still.
Where a prescription names a specific brand, the pharmacist must dispense the identified branded product. Conversely, where a prescription uses the INN, the pharmacist can satisfy the prescription with either a generic or branded product.
The online sale of medicines is permitted in the European Union, but it is up to individual member states to determine the specific conditions for sale online (eg, excluding prescription medicines).
Legally operating online pharmacies in EU countries must use an official logo to denote that their website is authentic and is supplying safe products. The logo links to the website of the national competent authority listing all legally operating online pharmacies.
In the United Kingdom, online pharmacies must be registered with the General Pharmaceutical Council and the MHRA and must meet the council’s standards for online pharmacies. The same laws apply whether the pharmacy is providing services in the traditional face-to-face way or online, but the guidance recognises that providing pharmacy services online carries particular risks which need to be properly managed in order to safeguard consumers.
The United Kingdom is one of 123 countries engaged in Operation Pangea, which targets the sale of counterfeit and illicit medicines and medical devices online. In the 2017/2018 reporting year this resulted in the seizure of 1.3 million doses of falsified and unlicensed medicines with an estimated value of £4.1 million and the closure of 3,500 websites in the United Kingdom.
Given the severity and scale of the problem, marketing authorisation holders would be wise to implement formal programmes for tracking and managing infringements online. New technologies permit greater oversight of online issues and enable rights holders to enforce at scale. An increase in their use is therefore expected.