Novartis Loses Battle Over EU Protection Period

by Ulrika Lomas, for LawAndTax-News.com, Brussels

25 April 2005

The European Court of Justice on Thursday ruled that patent protection for Swiss-manufactured pharmaceutical products in the EU will begin at the same time that they are authorised for sale in Switzerland.

The dispute centred on patents held by drug firm Novartis. As a result of a customs union between Switzerland and Liechtenstein patents are simultaneously recognised in both countries. Liechtenstein is also a member of the European Economic Area, a factor which led the EC to argue that patent protection should begin at the same time in both zones.

However, Novartis and US firm, Millenium Pharmaceuticals argued that this was unfair, as Liechtenstein and Switzerland represented test markets for Europe. They additionally observed that permission to test their products on the wider EEA market often came several months after they had gone on sale in Liechtenstein and Switzerland.

This, Novartis argued, effectively meant that EU patent protection for certain products began before European sales did.

The ECJ last week rejected Novartis' request that this state of affairs be remedied. Consequently, the State Secretariat for Economic Affairs (SECO) announced that it will be seeking changes to the customs union agreement with Liechtenstein in order to ensure that authorisations for new medicines granted in Switzerland will no longer automatically be granted in Liechtenstein.

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