Guest Post: 1st CNIPA important patent infringement administrative decision

This is a guest post by Toby Mak, Senior Counsel and Patent Attorney at Tee & Howe.

It was reported in October 2021 that the China National Intellectual Property Administration (CNIPA) accepted the first two patent infringement administrative complaints according to the Chinese Patent Law (2020), which empowers the CNIPA to accept such cases if they have nationwide influence. Now the first decision was issued by the CNIPA on 27 July 2022, and is available here (Chinese only). 

The subject patent is CN ZL201510299950.3 with Boehringer Ingelheim Pharma (BI) as the patentee, and with the title “[EN] 8-(3-amino-piperidin-1-yl)-xanthines, the production thereof and the use of the same as medicaments”. This is the active ingredient of the drug Linagliptin for treating diabetes.

The respondent was Yichang HEC Changjiang Pharmaceutical Co., Ltd (宜昌东阳光长江药业股份有限公司, HEC). HEC suspended the infringement case at the CNIPA in December 2021 by filing a first invalidation request, but was then withdrawn by HEC on 20 April 2022 after oral hearing. The infringement case then resumed at the CNIPA on 16 May 2022, although HEC filed a second invalidation request on 13 April 2022. As such, this case was decided by the CNIPA in less than 2.5 months. Such speedy action is difficult to be imagined in courts.

As this is an administrative case, BI only asked for injunction against making, selling and offering for sales of the drug Linagliptin by HEC, and removal of HEC sales on drug purchasing platforms in China (which is necessary for HEC’s generic drugs to be sold to hospitals in China), including Shanghai, Guangdong, Jiangxi, Shanxi, Inner Mongolia, Xinjiang, a total of 24 provinces/municipal cities. The CNIPA decided that this case fulfill the requirement as a case with nation wide influence mainly based on this.

HEC did try to argue that this case should not be accepted by the CNIPA, as the BI is already suing HEC at the Shanghai IP Court using the parent ZL03819760.X. However, as BI never used the current ZL201510299950.3 to sue HEC in a court, this HEC’s argument was dismissed by the CNIPA.

With regard to determination of infringement, there is not much room of argument from HEC, as HEC is producing the generic version of Linagliptin after all. In fact, HEC did not provide any evidence to argue in this case, and did not argue on this point at all.

Naturally, the CNIPA ruled in favor of BI, and granted the injunction as requested by BI.

HEC did argue that sales on drug purchasing platforms in China is an act exempted from patent infringement, and is not an offer for sales. The CNIPA’s decision did not have one word on this point. The Chinese Patent Law only has an exemption similar to the Bolar exemption in the US, that is, to produce, use or import patented drugs or medical equipment for obtaining marketing approval (from the NMPA). BI may consider appealing on this point. The appeal is to the Beijing IP Court within 15 days, i.e. by 11 August 2022.

Lessons to learn according to my own observation:

1) If the infringement occurs in many provinces/municipal cities, CNIPA would accept the infringement case and take care of you. It is not clear how many is “many”, but the minimum of two could be tried, as the law only requires “important cases across provincial administrative regions”.

2) Filing an invalidation request could suspend the infringement case at the CNIPA, but once this invalidation request is withdrawn, the infringement case would be resumed even if another invalidation request was filed to replace the withdrawn invalidation request. Better make up your mind and do the first invalidation request well.

3) In addition to injunction, BI could use this decision to sue HEC for infringement compensation in a court. This CNIPA decision favorable to BI could put HEC in a difficult position, as a court may be willing to defer to the CNIPA more.

4) The CNIPA’s decision is really fast. However, this may be particularly so only for this case, as there is little (practically no) room for argument from HEC of non-infringement. If HEC is not producing the useful generic drug, then HEC is producing fake drug. Either is bad.

Let’s wait and see whether the CNIPA would become a more favorable forum for determining patent infringement in China than the Chinese courts.

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