Germany. Magnus Hirsch, Markus von Fuchs and Margret Knitter SKW Schwarz Rechtsanwälte. Pharmaceutical Trademarks 2015/2016.

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1 Germany Magnus Hirsch, Markus von Fuchs and Margret Knitter SKW Schwarz Rechtsanwälte Pharmaceutical Trademarks 2015/2016 A Global Guide

2 Advert SKW Schwarz Rechtsanwälte SKW Schwarz: independent and business-minded The Law Firm Areas of Work SKW Schwarz is an independent German law firm. We advise companies of all sizes ranging from ownermanaged firms to listed corporations as well as private clients in all major areas of national and international commercial law. With offices in Berlin, Dusseldorf, Frankfurt/Main, Hamburg and Munich, we are present at major German business centers. With more than 100 lawyers, we regard ourselves as a mediumsized firm, which can yet take on international assignments that are usually the domain of large law firms. Our cooperation procedures across office locations enable us to set up teams for more complex transactions which are comparable to those of considerably larger competitors. Furthermore, our membership in international law firm associations and our cooperation with selected partner firms ensure that we can offer our clients excellent support around the world at any time. Banking and Finance Commercial and Distribution Corporate / M & A Employment Insolvency / Restructuring Insurance IP / Competition Law IT & Digital Business Litigation / Arbitration / Mediation Media and Entertainment Public Law Private Clients Real Estate Tax Transport SKW Schwarz is a firm which combines tradition and cutting edge service standards. Some of our offices have existed for several decades. Many of our client relationships have been in place for years a clear example of the importance we attach to stability. Berlin Düsseldorf Frankfurt / Main Hamburg München

3 Germany SKW Schwarz Rechtsanwälte Authors Magnus Hirsch, Markus von Fuchs and Margret Knitter Selection, clearance and registration By law, a company can market a pharmaceutical product only once it has received marketing authorisation. Marketing authorisation can be obtained through either a national application made in Germany or a centralised application for all EU member states and the European Economic Area countries (ie, Iceland, Liechtenstein and Norway). The competent authorities in Germany are the Federal Institute for Drugs and Medical Devices (BfArM) and the Paul Ehrlich Institute (PEI). The authorisation process is outlined in the Medicinal Products Act. Medicinal products or active substances with misleading names, descriptions or appearances cannot be manufactured or placed on the market. In particular, the following are considered to be misleading: disingenuous claims regarding the therapeutic efficacy or effects of certain pharmaceuticals or active substances; the false impression that a successful outcome is certain or that no harmful effects will occur when the pharmaceutical product is used for its intended purpose or for a prolonged period; and names, descriptions or appearances that influence how a pharmaceutical product or active substance is evaluated in order to mislead consumers regarding its quality (Section 8 of the Medicinal Products Act). The Community codes for pharmaceuticals for human use are set out in the EU Medicinal Products Directive (2001/83/EC), which has been transposed into the Medicinal Products Act. They provide the legal framework for the authorisation, manufacture and distribution of pharmaceuticals in the European Union. The name of the pharmaceutical may be an invented name which is unlikely to be confused with a common name, a common or scientific name accompanied by a trademark or the name of the marketing authorisation holder (Article 1(20) of the directive). The directive defines a common name as the international non-proprietary name (INN) recommended by the World Health Organisation or, if one does not exist, the usual common name. Marketing authorisations for pharmaceutical products are limited to five years, but can be extended by filing an application to BfArM or PEI. Further, Pharmaceutical Trademarks 2015/

4 GERMANY SKW SCHWARZ RECHTSANWÄLTE marketing authorisation can be obtained from the European Medicines Agency (EMA). Under a centralised procedure, pharmaceutical companies submit a single marketing authorisation application to the EMA. Once granted by the European Commission, a centralised marketing authorisation has EU-wide effect. The centralised authorisation procedure is based on EU Regulation 726/2004. Confusion with INNs Trademarks in the pharmaceutical sector are commonly created from descriptive terms, especially from INNs. One advantage of such trademarks is the link they create for patients between the pharmaceutical product and its application. However, INNs are excluded from trademark protection because they are merely descriptive and thus are indistinctive. However, under German law small changes to the INN can make it a registrable sign for example, ROXIMYCIN was accepted as a trademark, while the INN was Roxythromycin. Further, such trademarks have a limited scope of protection under German law. According to settled case law, the greater the distinctive character of the prior trademark, the greater the likelihood of confusion. This means that trademarks inspired by descriptive elements have a limited scope of protection. According to settled case law, the greater the distinctive character of the prior trademark, the greater the likelihood of confusion. This means that trademarks inspired by descriptive elements have a limited scope of protection The German Patent Court rejected the likelihood of confusion between the marks PANTOPREM and PANTOPAN (MEDA Pharma GmbH & Co KG v Takeda GmbH, 25 W (pat) 72/12). The court acknowledged that the opening syllables of the opposing mark ( panto ) referred to the active ingredient pantoprazol a proton pump inhibitor used particularly in gastrointestinal preparations and that the relevant public would recognise this. Therefore, it had to be presumed that attention would have focused on the additional word components or endings rather than the beginning of the marks. However, the differences between the compared marks would not have gone unnoticed in the overall aural and typographical impressions. Parallel imports and repackaging While parallel imports from outside the European Union clearly violate trademark law and can easily be prevented by civil and customs actions, especially as the burden of proof generally rests with the infringer, parallel imports within the European Union can also be prevented under certain circumstances. In line with trademark law, it is essential that brand recognition, origin and the guarantee of the trademark are maintained. However, it is equally important to guarantee repackaging for the importer. Otherwise, general enforcement by the rights holder would lead to market foreclosure. Thus, the European Court of Justice and the German Federal Court of Justice have established the following requirements, which must be fulfilled simultaneously: The reliance on trademark rights by the rights holder contributes to the artificial partitioning of markets between member states. Repackaging does not affect the original condition of the product inside the packaging. The new packaging clearly states who repackaged the product and the name of the manufacturer. The presentation of the repackaged product is not liable to damage the reputation of the trademark or the rights holder. The importer notifies the rights holder before the repackaged product is put on sale and supplies it with a sample on demand. 56 Pharmaceutical Trademarks 2015/2016

5 SKW SCHWARZ RECHTSANWÄLTE GERMANY Pharmacists are required to dispense generic pharmaceuticals in cases where the panel physician has prescribed a pharmaceutical product using its active substance name only or has not ruled out replacing the pharmaceutical product with an alternative The Federal Court of Justice recently dealt with the first of these requirements (Micardis, I ZR 99/12). The court addressed the question of whether market foreclosure occurred when the defendant was denied permission to import pharmaceutical tablets from Romania and England into Germany and repackage them. In Romania and England, a 28-tablet packet was standard, compared to a standard 98-tablet packet in Germany. Further, in England and Romania 98-tablet packets were unavailable. The court held that market foreclosure occurs once the parallel importer is forced to repackage the tablets due to objective circumstances. These circumstances are satisfied as soon as the importer is unable to meet the demands of the importing member state. Thus, market foreclosure occurs once the importer is excluded from a sub-market (eg, the 98-tablet packet market). Further, the court stated that the exclusion did not depend on whether it was possible in principle to distribute the packaging size unchanged. The Federal Court of Justice dealt with a further issue, as the defendant wanted to import tablets from France to Germany. In France, the relevant tablets were available in 30-tablet and 100-tablet packets, whereas in Germany a 100-tablet packet was standard. It was questionable whether the importer could be allowed to import the 100-tablet packets from France without repackaging the 30-tablet packets. The court held that the importer could not use only the 100-tablet packets. The test for exhaustion and necessity of repackaging was whether the specific imports needed to be repackaged in order to be traded on the relevant market. As the distribution of 30-tablet packets imported from France was prohibited in the 100-tablet packet sub-market, they needed to be repackaged in 100-tablet packets; therefore, repackaging was permitted. However, if the importer can use the original packaging, by attaching new labels and adding more blister packs, there may be no need to repackage. In the present case, it was held that the importer could add more blister packs to change the packet size from 28 tablets to 56 tablets and then repackage. The importer always bears the burden of proving the need to repackage. Anti-counterfeiting and enforcement The damage caused by counterfeit pharmaceutical products is a major issue in the European Union and Germany. Most counterfeit products arrive in Germany from non-eu member states. Regarding non-eu goods, Customs can act on the basis of EU Regulation 608/2013. The application of the regulation may be limited to customs action at the German border or to action in two or more member states (national or EU applications). When suspect goods are detected at the border, the German customs authorities will seize them, notify the declarant of their detention and allow the declarant 10 working days to consent or object to their abandonment for destruction. Customs will also notify the rights holder and disclose information on the shipment and the parties involved. Goods are considered to be abandoned for destruction when the rights holder confirms that they infringe an IP right Pharmaceutical Trademarks 2015/

6 GERMANY SKW SCHWARZ RECHTSANWÄLTE and requests their destruction, unless the declarant objects within the 10-day period. If the declarant objects to the detention, the rights holder has 10 working days to initiate infringement proceedings. Otherwise, Customs will release the goods. When filing an application, it is advisable to submit as much information as possible to enable Customs to analyse and assess the risk of an IP infringement, such as: the port or country from which the goods were consigned and their intended port of arrival in the European Union or Germany; details identifying the consignment or packages; the means of transport and identity of the carrier involved; and the country or countries of production and the routes used by traffickers. Advertising The Act Against Unfair Competition and the regulations of the Medications Advertising Act about product-related ads for pharmaceutical products apply to the advertising of pharmaceutical products. While prescription pharmaceuticals can be advertised to experts only (eg, physicians, pharmacists and Magnus Hirsch Partner Magnus Hirsch advises and represents national and international clients in all IP-related matters. He is a certified IP specialist and a frequently recommended IP lawyer in Germany who was recently named one of Germany s Best IP Lawyers for He is a member of the International Trademark Association, the Pharmaceutical Trademarks Group and the Intellectual Property Rights and Copyrights Association. Dr Hirsch is chief editor of TerraLex s global IP Newsletter and its global IP chair. He joined SKW Schwarz in 2007, previously practising as a lawyer and partner at Baker & McKenzie in Frankfurt and Hong Kong from 2001 to After graduating from the University of Passau, Dr Hirsch practised with Lovells in Frankfurt and Hamburg from 1997 to Markus von Fuchs Partner m.vonfuchs@skwschwarz.de Markus von Fuchs is a partner in SKW Schwarz s Berlin office. His client portfolio comprises some of Germany s leading companies in the medical devices industry, the healthcare sector and several other fields of healthcare-related technology. Since 2005, Dr von Fuchs has been legal counsel for Spectaris, a German industry association for the medical device industry. In particular, he advises on the enforcement of IP rights, R&D agreements, all matters deriving from German Medical Devices Law and the Medicinal Products Advertising Act, as well as compliance matters and regulatory affairs. Dr von Fuchs is a member of the firm s life science practice group and head of the IP and competition group. 58 Pharmaceutical Trademarks 2015/2016

7 SKW SCHWARZ RECHTSANWÄLTE GERMANY hospitals), non-prescription pharmaceuticals can be advertised to consumers. The Medications Advertising Act lists mandatory information to be included in pharmaceutical product ads, such as areas of application, side effects and warnings, which must match the package inserts prescribed in the Medicinal Products Act. In terms of content, such mandatory information must be clearly separate from other advertising messages; a distinction is made regarding the type of ad (eg, television or a display device). In cases of reminder advertising, significantly less mandatory information must be provided. Margret Knitter Partner m.knitter@skwschwarz.de Margret Knitter is a partner at SKW Schwarz s Munich office, specialising in the fields of trademark law, design law and unfair competition law. She advises her clients on the global administration, protection, enforcement of trademarks and designs and on structuring and developing their IP portfolios. In addition, she advises on anti-counterfeiting, licensing and merchandising issues and provides transactional support. Ms Knitter represents an international clientele ranging from industrial to mid-sized companies. She has special expertise in the pharmaceutical, chemical, crop science, confectionery, publishing, IT consulting, toy, clothing, mechanical engineering and luxury goods sectors. She has been a lecturer at the University of Liechtenstein since 2013 and is a member of the Pharmaceutical Trademarks Group. Reminder advertising is when only the name of the pharmaceutical product, the brand or the name of the manufacturer is advertised, without any medical or health information. Generally, health-related information is permitted only if it is accurate, unambiguous and clear. False advertising with efficacy information is prohibited and ads featuring efficacy information that is insufficiently documented or disputed by conventional medicine are also prohibited. Only efficacy information that has been the subject of pharmaceutical approval can be advertised. Even under these restrictive conditions, it is possible to advertise modes of action that were not the subject of the approval procedure, but there are particularly strict requirements for scientific proof of such modes. Government agencies need not examine and approve ads for pharmaceuticals before publication; instead, manufacturers must ensure that their ads conform with the law. However, ads featuring efficacy information are frequently the subject of legal dispute. This is because (allegedly) incorrect information not only is monitored and controlled by government supervisory authorities such as BfArM, but can also be challenged by competitors or consumer associations under Section 4/11 of the Act Against Unfair Competition. Accordingly, violations of market behaviour rules in the competition process can be pursued by the private sector. Section 3 of the Medications Advertising Act which governs the prerequisites of permissible ads featuring efficacy information is regarded as such a market behaviour rule. Consequently, efficacy information in Germany is closely monitored. Moreover, pharmaceutical ads must be factual and should induce no unnecessary or irrational uses. The Medications Advertising Act lists impermissible types of ad (eg, those using case histories, offering prizes or issuing coupons). A violation of the Medications Advertising Act not only leads to the prohibition of such ad, but may also result in one year s imprisonment for misleading advertising or fines of up to 50,000 for other violations. Generic substitution The cost explosion in the German health system has prompted the legislature and Pharmaceutical Trademarks 2015/

8 GERMANY SKW SCHWARZ RECHTSANWÄLTE German law generally allows the mail order sale of pharmaceuticals, including prescription pharmaceuticals, if the pharmacy has obtained the relevant permission health insurers to promote the prescription of generic pharmaceuticals by physicians and/or the dispensation of generic pharmaceuticals by pharmacies as a tool for reducing costs. As an innovative compound, a generic pharmaceutical must be approved initially. This is done through a simplified procedure. The manufacturer of the generic pharmaceutical must provide a bioequivalence document with the full clinical documentation of the innovative compound. This condition is satisfied if the generic pharmaceutical is equivalent to the innovative compound, exhibits adequate pharmaceutical quality and, in applications for humans, exhibits bioequivalent properties. An approved generic pharmaceutical that is identical to the active substance can be prescribed by physicians instead of the innovative compound if it features comparable biopharmaceutical properties, as it is then regarded as a therapeutic equivalent. This criterion is examined by determining plasma concentration-time profiles and pharmacokinetic evaluations. Dosage form, indication and properties related to the active substance can also play a role in the evaluation. Appropriate information is provided in the appendix of the Medicinal Products Directive entitled Information on the Interchangeability of Dosage Forms. Pharmacists issuing generic pharmaceuticals must follow the principles of the Framework Agreement on the Provision of Medicinal Products between the National Association of Statutory Health Insurance Funds and the German Association of Pharmacists. Accordingly, pharmacists are required to dispense generic pharmaceuticals in cases where the panel physician has prescribed a pharmaceutical product using its active substance name only or has not ruled out replacing the pharmaceutical product with an alternative with the same active substance. As a prerequisite, the generic pharmaceutical must contain the same active substance at an identical strength and in the same or an interchangeable dosage form. Online issues German law generally allows the mail order sale of pharmaceuticals, including prescription pharmaceuticals, if the pharmacy has obtained the relevant permission. In addition, pharmacies are subject to German price setting no matter whether the pharmaceuticals are sold by a German pharmacy or a foreign pharmacy (Section 78/I/4 of the Medicinal Products Act). A breach of the price-setting policy does not necessarily require a lower price, but is assumed if the pharmacist grants a discount with vouchers or similar. In 2014 the Federal Court of Justice dealt with a case in which German pharmacies tried to circumvent German price setting by advertising pharmaceutical products from pharmacies located in the Netherlands (Holland-Preise, I ZR 77/09). The pharmacy offered customers the chance to pay the cheaper Dutch price as the order was addressed to a German pharmacy. Customers would merely collect their ordered pharmaceuticals from the German pharmacy or in the Netherlands. When choosing to collect the pharmaceuticals 60 Pharmaceutical Trademarks 2015/2016

9 SKW SCHWARZ RECHTSANWÄLTE GERMANY in Germany, customers had to pay a fixed rate for transportation. Further, the general terms and conditions stated that the place of performance should be the place of business (ie, the Netherlands). The court ruled that the German price applied in such cases where German legislation was circumvented. If pharmaceuticals are sold over the Internet, the provisions on distance selling apply, especially the requirement to provide comprehensive information before purchase and confirm such information in a durable medium (eg, in writing), and the consumer s right to cancel the contract within a minimum of seven working days without reason and without penalty, except the cost of returning the goods (the right of withdrawal). Additional provisions pertain to: the right to a refund within 30 days of the consumer cancelling the contract; the delivery of goods or performance of service within 30 days of the consumer placing the order; protection from unsolicited selling; protection from fraudulent use of payment cards; and invalidity of any waiver of such rights and obligations, whether instigated by the consumer or the supplier. SKW Schwarz Rechtsanwälte SKW Schwarz Rechtsanwälte Mörfelder Landstraße 117 D Frankfurt/Main Germany Tel Fax Web Pharmaceutical Trademarks 2015/