The ECJ has ruled in a judgment of November 17, 2022 on the requests for preliminary rulings from courts in Germany (case number C- 147/20) and Denmark (case number C- 224/20) regarding parallel imports of medicinal products that repackaging of medicinal products by parallel importers generally infringes trade mark rights of the original manufacturer even when taking into account the EU Falsified Medicines Directive and that the original manufacturer can assert its trade mark rights. All proceedings deal with the assessment of the area of tension between trademark law on the one hand and pharmaceutical law, in particular in the light of protection against counterfeit medicines, on the other hand. The pharmaceutical company Novartis sued the Danish parallel importer Abacus in Germany and Denmark in the proceedings. With the judgements, the ECJ strengthens the trademark rights of pharmaceutical manufacturers and follows the argumentation of Novartis.
Parallel importers purchase medicinal products in EU countries with lower price levels and sell them in EU countries with higher price levels, such as Germany, Denmark and Sweden. To do this, the parallel traders have to change the information for use and the drug packages in each case to be in the language of the country of destination. For various reasons, parallel importers have for years preferred not to add additional labels to the original packaging, but to use completely new packaging. The repackaging and application of trademarks of the original manufacturer by the parallel trader constitutes a trademark infringement according to the constant case law of the ECJ and the national courts, since the application of a trademark should only be permitted to the trademark owner and not to any third party; only in defined exceptional cases should repackaging be permitted under trademark law.
With the application of the EU Falsified Medicines Directive, both original manufacturers and traders who change packages must apply additional elements to protect against falsification. Parallel importers have used these additional legal requirements as an argument to be allowed to repackage medicinal products in principle from now on, in order to avoid having to relabel original packaging. Some governments of EU member states have explicitly offered repackaging and have spoken out against the relabeling of original packaging. The European Commission has considered repackaging to be the right approach whenever a - necessary - opening of the original packaging would remain recognizable later. Novartis is challenging this in proceedings against the parallel trader Abacus in Germany and Denmark. Novartis defends its own trademark rights and additionally refers to the particularly high level of protection of original packaging for the patient.
With the rulings of November 17, 2022, the ECJ follows the argumentation of Novartis and the view of the Advocate General that repackaging of medicinal products by parallel traders fundamentally infringes trademark rights of the original manufacturer even when complying with the Falsified Medicines Directive and that the original manufacturer can enforce its trademark rights. Contrary opinions of governments of individual EU member states are irrelevant and do not prevent the enforcement of trademark rights. Only in exceptional cases defined by the ECJ, for which the parallel trader bears the burden of proof, repackaging is permissible.
With the rulings, the ECJ strengthens the trademark rights of pharmaceutical original manufacturers and follows the argumentation of Novartis. The ECJ also rejects the views of individual governments of member states and restricts the previous position of the European Commission.
The King & Spalding team acting for Novartis was led by Frankfurt partner Ulf Grundmann and counsel Elisabeth Kohoutek.