pharmaceutical trademarks in russia · russia today: the bright side russia = country of...

Pharmaceutical

Trademarks in Russia

September 2015

David Aylen

RUSSIA: pharma

Overview of Russia today

Trademarks

Part IV Civil Code

Prosecution practice in Russia

IP Court + recent cases

Anti-counterfeiting

Parallel Importation

Eurasian Economic Union

2

3

MY POINT OF VIEW…

4

OVERVIEW OF

RUSSIA TODAY

RUSSIA TODAY: economy + geopolitics

in 2013 deep recession was predicted for 2014

and beyond

Spring 2014 Ukraine and Crimean crisis

Summer 2014 Malaysian airline tragedy

Western sanctions cut off flow of capital

foreign investment crumbled

Russian countersanctions

suspension from G8

5

RUSSIA TODAY: economy +geopolitics

drop in oil prices

devaluation of the RB

capital flight

localization

conservatism

data protection

parallel importation for medicines …

national payment card system

rise in Putin popularity

6

RUSSIA TODAY

Is the glass half empty or half full?

[can’t I be more of an optimist?]

7

RUSSIA TODAY: the bright side

Russia = country of exponential highs and lows

population of 140M consumers

expanding middle class

medication-oriented society

localization = benefits + opportunities

towards a new self-sustainable Russia

Embassy of Switzerland 2011:

“The Russian pharmaceutical market is considered to be

one of the most dynamic and growing in the world. It

continues to grow in average 10-12% per year since

2003 […]”

8

RUSSIA TODAY: Pharma 2020

Pharma 2020:

• adopted in 2009

• plan to foster innovation and localization

in 3 ways:

localization of design and manufacture

of drugs

development of a pharma industry

locally within Russia

development of a pharma industry

that extends into the international market

9

RUSSIA TODAY: Pharma 2020 “scorecard”

10

creation of 5 pharma clusters (incubators)

Takeda, Novartis, Astra Zeneca, Bayer...

significant increase in foreign investment

and localized manufacturing

new plants

new partnerships

RUSSIA TODAY: sanctions

• Western sanctions:

• on individuals

• on long term financing

• Russian sanctions

• on agricultural, fish, meat and other food products

• on individuals

• Collateral effects

• no foreign investment

• cash shortages

• reduced consumer spending

11

RUSSIA TODAY: sanctions

• Medicines and medical equipment

• not covered by any sanctions

• Russia promises not to target foreign pharma products

• pharma sanctions would hinder Pharma 2020

• Russia sanctions would = political suicide

• President contemplating the opposite with parallel

imports

• Reported import sales decreases

• not sanctions related

• affected by devaluation of currency

12

13

RUSSIA TODAY:

Pharma trademarks

14

TRADEMARKS Part IV Civil Code



Anti-counterfeiting



15

TRADEMARKS Part IV Civil Code + other laws



Anti-counterfeiting



PART IV CIVIL CODE (2008): trademarks

consolidates and codifies all IP rights

registration system for trademarks

Acknowledges IP as property

entitlement to register

process for registration

right to assign and license

right to enforce and compensation

obligation to use

right to cancel

16

Other laws

• Law on Circulation of Medicines

• Criminal Code of Russian Federation

• Code of Administrative Offences

• Federal Law on the Protection of Competition

• Customs Codes of the RF + Customs Union

• Paris Convention

• WTO + TRIPS

17

TRADEMARKS: core concepts

registrability:

Art. 1482 words, images, 3d, color

Art. 1483 (abs. + relative grounds) not registrable if lacks distinctiveness;

false representation or misleading;

identical or confusing with previously registered

or applied-for TMs

disclaimer

acquired distinctiveness

non-use

post grant cancellation (no opposition in prosecution)

protest letters in prosecution

assignment and license

well known marks

18


Not distinctive (TM Regulations):

• simple geometric figures, lines, digits

• single letters and combination of letters which do not obtain verbal

character or can not be recognized as a word

• common names

• realistic or schematic images of a product

• descriptive terms relating the goods or information characterizing

product- weight-quality-materials the goods are made of.

19


exclusive rights

on goods or for services

marketing or printed material

proposals, announcements, signs, advertising

on internet or in domain names

enforcement

injunction + destruction

actual damages

or compensation up to 85,000 USD

or “double” value of the goods or reasonable royalty

20

21




Anti-counterfeiting



RUSSIA TODAY: new filings

22

14289 16083 15875

19143

16712

42559 43634

46048 45785 44476

2010 2011 2012 2013 2014

National and Madrid TM Filings in Russia

Madrid Filings (accrording to Rospatent)** Russian Patent Office**

TM PRACTICE AND PROCEDURE

regular rules apply

“Guidelines for the Rational Choice of Names

of Medicines” (Ministry of Health, 2005):

Introduction

Definitions

Legislative framework

INNs (International non proprietary names)

23

TM PRACTICE- Guidelines

INNs + Basic principles for the rational

selection of brand names for drugs:

basic rules (viz. do not use INNs as a component)

methodological approaches to devising brand

names:

linguistic model

Stem composition

Suffixation

prefixes

Acronyms …

24

25




Anti-counterfeiting



The Intellectual Property Court

• formed July 2013

• specialist division within Commercial Court

(Arbitration Court)

• about 15 judges

• based in Moscow

• much like CAFC

• appeals from lower court cases

• shaping the interpretation of IP law in Russia

• jurisdiction in all areas of IP

26

RUSSIA’S NEW IP COURT

Types of cases

Challenging Legal

Acts of PTO Assessing IP rights

Determining

inventorship

ownership @ 1st

instance

Reviewing

Revocation or

Cancellation

Decisions of

Chamber

Cancelling TM

registrations for

non-use @ 1st

instance

Infringement

Cassation

Appeals from

Trial and 1st

appeal

Challenging

Federal

Anitimonopoly

Service

Decisions

Reviewing

decisions of

ROSPATENT

Jurisdiction of the IP Court


28

Supreme Court

Intellectual Property Court

Commercial Courts of Appeal (20)

Commercial Courts (81) Infringement

litigation

Presidium of Intellectual

Property Court

Intellectual Property Court

ROSPATENT (formerly the Chamber for Patent

Disputes)

Revocation proceedings


• Several advantages:

• creates subject-matter expertise

• effectiveness of decision-making

• rules of practice

• consistency and predictability

• establishes credibility of IP in Russia

• assists in the fight against corruption

29

RECENT CASES

Teva v. Rospatent March 2015

Chamber for Patent Disputes (CPD)

• application for BETA CALCIY

• examiner rejection: “capable of misleading as to

source given CALCIUM BETA product also on the

market”

• objection based on internet search by examiner

• reversed by CPD:

• no evidence of use of CALCIUM BETA in Russia

• only available on German website

• not listed on State Register of Medicines

30

RECENT CASES

Pik Pharma v. Rospatent February 2012

Supreme Arbitration Court

application for KARNITON

examiner rejection: “confusing as it is a derivation of the INN:

CARNITINE”

applicant argued that (i) WHO resolution for INNs was not part

of Russian law and (ii) not use of an INN*

HELD:

public policy should prevent anyone from registering an INN

or a mark that is derived from an INN

derivation analysis = traditional confusion analysis

*international non-proprietary name

31

RECENT CASES

Altaivitamini v. Pharm-Pro June 2015

Seventh Court of Appeal

TM infringement

TM owner sued manufacturer of product using the registered

TM

TM owner had licensed Geneses to make and sell branded

product

Genesis sub-contracted manufacturing to Pharm-Pro

HELD:

infringement

Pharm-Pro was not a party to any license

no license to Pharm-Pro was recorded in TMO

Genesis had to have approval from TM owner before it could

sub-contract manufacture to a 3rd party 32

33




Anti-counterfeiting



COUNTERFEITS: how bad is it?

34

it depends on who you ask: • Doctors: 50% OTC are fakes

• Roszdravnadzor: 12% of all drugs are fakes

• Prosecutor General: 15%

• WHO: 20%

amongst “finest counterfeits ever seen”

most are domestically produced

40% Russians are affected

fakes live by no rules: toxicity; purity; contamination; no active ingredients; insufficient active

ingredient; too much active ingredient...

ineffectual laws

COUNTERFEITS: challenges

35

• established criminal networks

• night-shift drugs

• diagnosis and treatment uncertainties

• attraction of cheap medicines

• online pharmacies

COUNTERFEITS: new criminal provisions 2015

36

• increased liability for production; storage; transportation

and circulation of unlicensed or fake medicines:

The Illegal Act Basic Offender Criminal Organization

Production of medicines without consent/license

Art. 235.1

3-5 yrs prison+ $8k-30k USD (or convict’s wages: 6mo’s-2yrs)

5-8 yrs prison + $15k-45k USD (or convict’s wages: 1-3 yrs)

Circulation – importation of fakes, unregistered, low standard drugs Art. 238.1

3-5 yrs prison+$8k-30k USD (or convict’s wages: 6mo’s-2yrs)

**if death 2+ people: prison 8-12 yrs

5-8 yrs prison + $30k-75k USD (or convict’s wages: 1-3 yrs)

**if death 2+ people: prison 8-12 yrs

Forgery of docs relating to medicines Art. 327.2

Up to 3 yrs prison+$8k-16k USD (or convict’s wages: 1-2yrs)

5-10 yrs prison

Administrative Code –illegal acts not classified as criminal

Fines from $1k USD to $75k Fines from $1k USD to $75k

Note: not all fines and jail sentences are detailed here

ONLINE PHARMACIES

3 basic types:

Online delivery service – pharmacies that deliver to

patients after receiving a prescription sent electronically by a

doctor

Online diagnosis + prescription – pharmacies that

employ doctors to prescribe medication based on

questionnaires or e-interviews after which medication is sent to

patient

Unregulated order + delivery without doctor

involvement ** – pharmacies that are willing to deliver w/o

prescription

37

ONLINE PHARMACIES: in Russia

Russian law:

only licensed pharmacies/persons or hospitals can sell

medicines

licensees must have physical premises

sale of medicines by distance methods (viz. internet) is

prohibited

Online sales tactic:

patient registration online + selection of medicine +

payment and pick-up via courier

courier pick-up acting as agent for buyer on premises

at licensed pharmacy

80%+ are illegal/selling counterfeit

38

39




Anti-counterfeiting



PARALLEL IMPORTATION: illegal

Parallel importation is illegal in Russia

Art. 1484 confers to TM owner the exclusive right...,

to place the TM on goods that are introduced into

civil commerce on the territory of Russia.

[parallel importation = infringement]

Art. 1487 use of a TM on goods that were lawfully

introduced into Russia by the TM owner are not

infringing [national exhaustion]

laws approaching these provisions also in Code of

Administrative Offences; Criminal Code; and Federal

Competition Law

40

PARALLEL IMPORTATION: San Pellegrino

Nestle Waters et al. v. Akvalife May 2015

IP Court

defendant imported waters from outside Russia

legally purchased and legally branded

HELD:

distinguish legally acquired property and possession with

unapproved use by introduction into commerce in Russia

distinguish civil claim under Pt. IV with earlier Porsche case

under Code of Administrative Offences

41

PARALLEL IMPORTATION: What next?

Government currently reviewing its approach to

parallel importation on public policy grounds

historically Russia sided with brand owners and the

need to protect investment in new emerging

distribution channels in Russia

current momentum to allow parallel importation:

Prime Minister urging Government to create exemptions

in pharma and elsewhere

FAS urging international exhaustion in all cases

Now up for review in Eurasian Economic Union

42

43




Anti-counterfeiting



EURASIAN ECONOMIC UNION

What is the

44

EURASIAN ECONOMIC UNION

Economic union of states. Primarily northern

Eurasia

Treaty in effect since January 1, 2015

45

EURASIAN ECONOMIC UNION: membership

46

EURASIAN ECONOMIC UNION: the 4 freedoms

evolved since 1994 after dissolution of the

Soviet Union

now an integrated single free market: 183M

people

Treaty on the Eurasian Economic Union:

The “FOUR FREEDOMS”:

= free movement of ,

goods

capital

services

people

47

Eurasian Economic Union: people and goods…

48

Sheremetyevo

International Airport*,

Moscow, Russia.

Passengers from

Kazakhstan are no

longer subject to

customs inspections

* Wikipedia: Creative Commons ShareAlike License

https://en.wikipedia.org/wiki/Sheremetyevo_International_Airport

https://en.wikipedia.org/wiki/Sheremetyevo_International_Airport

//en.wikipedia.org/wiki/Wikipedia:Text_of_Creative_Commons_Attribution-ShareAlike_3.0_Unported_License

EURASIAN ECONOMIC UNION: pharma

Special provisions of the Treaty

• Art. 30 & 31 Common market for,

• Medicines

• Medical products

• Medical devices & equipment

• in effect January 2016

49

EURASIAN ECONOMIC UNION: pharma

Art. 30-31

• harmonization of laws

• unity of requirements for quality, effectiveness

and safety

• common rules and regulations

• comparable methods to evaluate quality…

• harmonized control and supervision

50

EURASIAN ECONOMIC UNION: Customs Union

51

Eurasian Economic Union: border controls

52

“Customs Union” means a form of trade and economic

integration of the Member States envisaging a common

customs territory, within which no customs duties (other duties,

taxes and fees having equivalent effect) …and common

measures regulating foreign trade with a third party;

• the Customs Union is Section V of the Treaty

• in operation since 2010

Eurasian Economic Union: exhaustion

Shift to Regional Exhaustion of rights in the EEU

53

V. Principle of Exhaustion

of the Exclusive Right

for a

Trademark

and the Trademark of the Union

16. The principle of exhaustion of the exclusive right to a trademark and the

trademark of the Union shall be applied on the territories of the Member States,

in accordance with which the use of a trademark or the trademark of the Union in

relation to goods lawfully put into civil circulation on the territory of any

Member State directly by the right holder of the trademark and/or the trademark of

the Union or other persons with its consent shall not be regarded as a violation

of the exclusive rights to the trademark or the trademark of the Union.

EURASIAN ECONOMIC UNION: take away points

• “4 freedoms of movement”: goods, services,

capital, people

• special provisions for medicines and medical

devices

• regional customs union

• regional exhaustion of rights

54

Thank You

montréal ottawa toronto hamilton waterloo region calgary vancouver beijing moscow london

David Aylen Managing Partner

Gowlings RUSSIA/CIS

pharmaceutical trademarks in russia · russia today: the bright side russia = country of...

Documents