First published in our Biotech Review of the Year publication (Issue 10).
The decisions clarify the situations when trade mark owners in certain circumstances may object to parallel traded medicinal products that have been re-packaged. The regulatory requirement for including an anti-tampering device does not mean re-packaging is necessary in every case. The presence of traces on the original packaging of the original anti-tampering device being removed does not warrant that re-packaging becomes necessary. It is only if the affected original packaging is met by consumer resistance (which needs evidence) then the re-packaging might be necessary.
The parallel trade in issue occurs where original branded products are acquired in one country and imported into another without the permission of the brand owner. Typically parallel importers will often buy legitimate products in one country where the price is cheaper and then resell these in a different country for a higher price. In the UK and the EU due to the exhaustion principle, once the legitimate goods have been put on the marketplace with the brand owner’s consent, the owner cannot ordinarily prevent the resale of original products on trade mark infringement grounds. However, it is possible for a trade mark owner to object but only if there are legitimate reasons to oppose the further marketing. Re-packaging by the parallel importer could fall into this category. Where the re-packaged products are medicinal products, the EU regulatory framework on the marketing of medicines also applies. In fact, to protect the public and ensure the safety of patients, a series of requirements were introduced under EU law which are relevant in the context of re-packaging of medicinal products. This article therefore discusses the grounds on which pharmaceutical companies may stop parallel importers from re-packaging medicines.
These cases reached the CJEU through referrals from Courts in Denmark, Belgium and Germany. In all of these cases, the central issue was the extent to which parallel traded medicines could be re-packaged to meet the EU regulatory requirements for medicines without infringing the rights of the brand owner.
Notably, in Novartis v Abacus, Abacus argued that it was obliged under EU law to replace the packaging of Novartis’ Votrient medicine with a new outer packaging in order to be able to market the product in Germany. The trade mark owner would not therefore be entitled to oppose that re-packaging on trade mark infringement grounds. Novartis disputed this by arguing that a new packaging was not necessary to comply with the requirements under EU law to prevent the entry of falsified medicinal products in the legal supply chain. These requirements could instead be complied with by affixing the unique identifier with an adhesive label and the placing of a new anti-tapering seal to cover the traces of opening after having included the new leaflet in German in the original packaging.
Abacus argued in response that, under the EU Falsified Medicines Directive (the FMD) and Delegated Regulation (the DR), products must have obligatory safety features such as an anti-tampering device on the external packaging. Suppliers of medicinal products are prohibited from selling products which show signs of tampering. As a result, Novartis’ suggestion of re-sealing the packaging would not work as it would result in visible alterations to the original packaging. So, in Abacus’ opinion, a new outer packaging was therefore necessary in order to comply with the FMD/DR.
The Court rulings
The CJEU decided that Novartis and Bayer were entitled to oppose the marketing by parallel traders of the re-packaged medicines on the basis of their registered trade marks. In essence, the re-packaging was unjustified in these cases as (a) the re-labelling of these products (including by affixing an adhesive label) and (b) replacement of the original anti-tampering device with an equivalent one would have been sufficient to satisfy FMD/DR requirements. The presence of traces on the packaging of having been opened as argued by Abacus is not, in itself, sufficient to justify re-packaging if the replacement anti-tampering device is “equivalent”. Thus, re-packaging would not be necessary.
When deciding whether it was objectively necessary for the medicines to be re-packaged the CJEU considered its prior decision in Boehringer Ingelheim. The re-labelling and re-packaging of medicinal products had been considered in that case where the CJEU ruled that if re-labelling is possible for the purposes of marketing the medicine in the country of importation then the replacement packaging is not necessary. If so, trade mark owners are entitled to oppose the re-packaging on the grounds that re-labelling is possible. In this context, the CJEU also emphasised that the re-packaging of medicinal products should aim at securing effective access to the market of importation. Securing a commercial advantage would not be considered “necessary” for market access and could no doubt be opposed by the trade mark owner.
However, it is important to note that if re-labelling alone hinders the effective access of that medicinal product in the country of importation the re-packaging would be a necessity. For example, if a significant portion of consumers showed strong resistance to the altered product then this could constitute an obstacle to effective access to that market. This, however, must be established on the evidence on a case-by-case basis.
The Court acknowledged that the replacement of the anti-tampering device with an equivalent one could potentially be met with consumer resistance, so it will need assessment on a case-by-case basis. The CJEU considered in this case that a parallel importer cannot rely on a general presumption of consumer resistance. Such resistance must be considered taking note of the specific circumstances.
- Trade mark owners can oppose the marketing of a parallel traded medicinal product which has been re-packaged provided such re-packaging was unnecessary to meet the EU regulatory requirements.
For parallel traders, it is essential to perform an assessment of whether re-packaging is justified because it will be considered “a necessity” or whether re-labelling would be accepted. There would be room to argue that re-packaging is needed if, for example, consumers would meet the anti-tampering replacement with strong resistance.
 CJEU Judgments of 17 November 2022, Novartis Pharma GmbH v Abacus Medicine A/S, C 147/20 and Bayer Intellectual Property, C-204/20
 Directive 2011/62/EU
 Commission Delegated Regulation (EU) 2016/161
 CJEU judgment of 26 April 2007, Boehringer Ingelheim and Others, C 348/04