Expedited Court of Appeal confirms expiry of Lucentis SPC ahead of time

08 April 2020

We recently reported on Master Data Center, Inc (and Genentech Inc) v The Comptroller General of Patents [2020] EWHC 572 (Pat), in which the High Court (Patents Court) held that an error in the payment of the fee for Genentech's SPC for Lucentis could not be corrected, with the consequence that almost two years of the expected term of SPC protection would be lost. Now, following a highly expedited video-conferenced appeal hearing the Court of Appeal has confirmed the Patents Court's judgment.



The Court of Appeal's judgment in Genentech, Inc (and Master Data Center, Inc) v The Comptroller General of Patents [2020] EWCA Civ 475 (31 March 2020) was handed down within three weeks of the Patents Court's 11 March judgment.

The arguments pursued by the parties on the appeal were pretty much the same as in the High Court.

On the question of whether there is only one prescribed fee for an SPC, namely the fee which is appropriate to the full duration of the SPC as laid down in Article 13 of the SPC Regulation, the Court of Appeal considered whether it was bound by its earlier judgment in Tulane Education Fund's Supplementary Protection Certificate [2013] EWCA Civ 890. This depended on whether the relevant part of the earlier judgment was "ratio" (a point that determines the judgment and so usually binds lower and later courts) or merely "obiter" (a comment made by the judge in passing and not binding on lower and later courts).

In Tulane, the CA held that an applicant for an SPC "may elect to take the certificate for a shorter period and, if he does so, he will only pay a fee in respect of those years for which he has elected". MDC submitted that there had been no argument on the point in Tulane as the parties had assumed it to be correct, and so this part of the Tulane judgment was obiter (meaning that the CA was not bound by it).

However, the CA noted that the absence of argument before the earlier court does not necessarily lead to the conclusion that the point has not been considered and decided by the court: the point can still be ratio. The CA noted that Tulane concerned whether the "prescribed fee" (for the purposes of Rule 6 of the Patents (Fees) Rules) was an "annual fee" (for the purposes of the SPC Regulation). If the applicant for an SPC was not able to elect for a period shorter than the maximum, that would have been highly relevant to the argument that the prescribed fee was not an annual fee. However, in Tulane the CA (Kitchin LJ) decided that the prescribed fee was an annual fee and a part of the reasoning for that conclusion was that the applicant could elect to take a certificate for a shorter period.

On the question of whether there is only one prescribed fee for an SPC, namely the fee which is appropriate to the full duration of the SPC laid down in Article 13 of the SPC Regulation, MDC's appeal was therefore dismissed. More generally, Floyd LJ noted that the salient features of the UK scheme are as follows ([42]):

  1. The prescribed fee is the total of specified annual fees, albeit payable in one go and in advance.
  2. By paying a prescribed fee appropriate to something less than the full term, the applicant "may elect to take the certificate for a shorter period".
  3. The applicant is not permitted to pay top-up annual fees, or annual fees as if they fell due year by year.
  4. If the applicant chooses a shorter period than the maximum, the SPC lapses at the end of the chosen period.

Floyd LJ further confirmed that one cannot use the payment of a paediatric extension fee to pay for additional annual fees, and thereby rectify an error in the payment of the prescribed fee. The six months' extra exclusivity granted by way of paediatric extension is added to the maximum term of the SPC, which therefore remains in force with a longer duration. It is not a separate SPC. The SPC still lapses if the prescribed fee is not correctly paid.

As a final and noteworthy point, the expedited hearing before the CA took place in accordance with the new Practice Direction 51Y, which concerns video and audio hearings during the coronavirus pandemic. It is encouraging that so much of the courts' business is progressing on normal timetables.

Our article reporting on the Patents Court's judgment - Pay the correct SPC fee or risk expiry ahead of time! - can be found here.


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